Document:

SHARE EXCHANGE AGREEMENT

                                  by and among

                        COMPOSITE TECHNOLOGY CORPORATION

                                    ("BUYER")

                                       and

                                 SHAREHOLDERS OF

                                  EU ENERGY PLC

                              ("EUE SHAREHOLDERS")

                                       and

                                 Michael Porter

                          Effective Date: June 2, 2006

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                            SHARE EXCHANGE AGREEMENT

         This Share Exchange  Agreement (this "Agreement") is entered into as of
June  2,  2006,  by  and  among  COMPOSITE  TECHNOLOGY  CORPORATION,   a  Nevada
corporation  (the "Buyer") and certain of the persons who are shareholders of EU
Energy plc., a U.K. public company registered in England and Wales under company
number  05026943  proposing to  re-register  as a private  limited  company (the
"Parent  Company"),  set  forth  in  Schedule  B  (each  referred  to as a  "EUE
Shareholder" or a "Seller," and  collectively as the "EUE  Shareholders"  or the
"Sellers"), including without limitation, Stephen Bircher, Rayna Limited, Keeley
Services Limited,  Wellsford  Management Limited, and Laikadog Holdings Limited,
and Michael Porter (these five  shareholders  and Porter shall be referred to as
"Major Shareholders").

                                R E C I T A L S:

         WHEREAS,  the EUE  Shareholders  collectively  own at least  95% of the
issued and outstanding shares of common stock of the Parent Company;

         WHEREAS,  the Parent  Company  owns 100% of the issued and  outstanding
capital stock of DeWind Holdings Limited, a United Kingdom company registered in
England and Wales under company  number  05309221  ("DeWind UK"), EU Energy Wind
Ltd., a United  Kingdom  company  registered  in England and Wales under company
number  04942587  ("EUE Wind"),  EU Energy North  America Inc, a Nevada  company
("EUE US"),  and EU Energy  Service & Maintenance  GmbH, a German  company ("EUE
Maintenance");

          WHEREAS, the Parent Company, through DeWind UK, owns all of the issued
and  outstanding  stock of DeWind GmbH,  a German  company  ("DeWind  GmbH") and
Direcktwind GmbH, a German company ("Direcktwind"),  and Parent Company owns 75%
of the issued and outstanding  stock of EU Energy WingPower Ltd., a U.K. company
("EUE  WingPower"),  and owns  indirectly EU Energy Canada  Limited,  a Canadian
company ("EUE Canada"),  and EU Energy Wind Turbines GmbH, a German  corporation
("EU  Turbines",  and along with DeWind UK, EUE Wind,  EUE US, EUE  Maintenance,
DeWind GmbH, Direcktwind, EUE Canada, and EUE WingPower, and the Parent Company,
the "EUE Companies");

         WHEREAS,  Buyer  desires to acquire from the  Sellers,  and the Sellers
desire to sell to Buyer, the issued and outstanding  capital stock of the Parent
Company  listed  against such  Sellers  name in Schedule B (the "Parent  Company
Shares") in exchange  for  newly-issued  shares of Buyer  common  stock  ("Buyer
Shares"),   subject  to  the  terms  and  conditions  contained  herein  ("Share
Exchange");

          WHEREAS,  the  Major  Shareholders  hold  more  than  73.895%  of  the
outstanding common stock of the Parent Company and hereby intend to make certain
representations  and  warranties  regarding  the EUE  Companies  and to agree to
certain transferability restrictions of their Buyer Shares during the first year
following the date of Closing;

         NOW,  THEREFORE,  in  consideration  of the  premises,  agreements  and
covenants  contained  herein,  and other good and  valuable  consideration,  the
receipt and  sufficiency of which are hereby  acknowledged  and in reliance upon
the mutual  representations and warranties  contained herein, the parties hereto
agree as follows:

                                A G R E E M E N T

                                    ARTICLE I
                                   DEFINITIONS

         1.1 Certain  Definitions.  Capitalized terms used in this Agreement but
not  defined in the body  hereof  shall have the  meanings  ascribed  to them in
Exhibit A. Capitalized terms defined in the body of this Agreement are listed in
Exhibit A by location herein.

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                                   ARTICLE II
                           PURCHASE AND SALE; CLOSING

         2.1 Transfer of Parent  Company  Shares.  Upon the terms and subject to
the conditions of this Agreement, at the Closing:

                  (a) the  Sellers  shall  sell,  transfer,  assign,  convey and
deliver to the Buyer the Parent Company Shares; and

                  (b) in exchange for the Parent Company Shares, the Buyer shall
issue to Sellers the Buyer Shares (as defined below).

         2.2 Share Exchange.

                  (a) Each Seller shall receive stock certificates  representing
three (3) Buyer  Shares for every two (2) Parent  Company  Shares  held  ("Buyer
Share Certificates") such Buyer Shares to be issued to the Sellers as set out in
Schedule  A. If the  Sellers  were to  deliver  100% of the  outstanding  Parent
Company  Shares,  then the  total  consideration  to be paid by the Buyer to the
Sellers  for the sale,  transfer,  assignment,  conveyance  and  delivery of the
Parent Company  Shares,  shall be the issue of Thirty Nine Million,  One Hundred
Sixty Nine  Thousand Six Hundred Sixty Five  (39,169,665)  shares of the Buyer's
common stock ("Buyer Shares").

                  (b) Buyer  Shares  issued to the Major  Shareholders  shall be
subject to a Lock-up  agreement with  indemnification  obligations  called an EU
Energy Principals' Agreement set forth in Exhibit B.

                  (c) The Parties have agreed that the value of all  outstanding
Parent Company  Shares shall be fixed and based on the closing  trading price of
the  Buyer  Shares  on 11 May 2006 and that such  value is  approximately  $60.7
million. Any subsequent increase or decrease in the share price shall not affect
the exchange of shares as contemplated herein.

                                   ARTICLE III
                           CLOSING; CLOSING DELIVERIES

         3.1 Closing. The closing of the purchase and sale of the Parent Company
Shares (the  "Closing")  shall take place at the offices of  Richardson  & Patel
LLP, 10900 Wilshire Boulevard, Suite 500, Los Angeles, California, 90024, at any
time  commencing  at 9:00  a.m.,  Los  Angeles  time,  on July 3, 2006 or a date
mutually agreed upon by the parties (the "Closing Date").

         3.2 Seller  Deliveries.  At the Closing,  the Sellers  shall deliver or
cause to be delivered to the Buyer:

                  (a) EUE Companies  Share  Certificates  (or indemnity for lost
share  certificates)  and stock transfer forms.  Certificates  representing  the
Parent  Company  Shares (or  indemnity for lost share  certificates),  and stock
transfer  forms  duly  endorsed  by the  Seller to the Buyer or  accompanied  by
separate powers sufficient for the transfer of all of the Sellers' right,  title
and interest in such Parent Company Shares to Buyer;

                  (b) EUE Companies Secretary Certificates.  Certificates, dated
the Closing Date,  signed by the Chief Executive Officer of each EUE Company (i)
attaching  certified copies of the EUE  Organizational  Documents  applicable to
such EUE Company,  and (ii) certifying that all director,  shareholder and other
actions  required to authorize  and approve the  execution  and delivery of this
Agreement  and the other  documents and  agreements  provided for herein and the
transactions  contemplated  hereby and thereby have been taken and setting forth
copies of such actions;

                  (c) Approvals and Consents. Copies of all permits, consents or
approvals of third parties or  Governmental  Authorities,  the granting of which
are necessary for the  consummation of the transactions  contemplated  herein or
for  preventing  the  termination  of any  right,  privilege,  license,  permit,
certificate  or  agreement of the EUE  Companies  upon the  consummation  of the
transactions contemplated herein;

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                  (d) Public  Certificates.  Copies of certificates of existence
and good standing for each of the EUE Companies issued by the appropriate public
officials  of  Germany,  the United  Kingdom and the State of Nevada  (USA),  as
applicable, each dated within ten (10) Business Days prior to Closing;

                  (e)  Resignations.  The written  resignations of each director
and officer (or the equivalent in any relevant  jurisdiction) of each of the EUE
Companies  incorporated  under U.K.  law other than EUE  WingPower  set forth on
Schedule 3.2(e);

                  (f) EU  Energy  Principals'  Agreement.  Stephen  Bircher  and
Michael Porter shall have executed the EU Energy Principals' Agreement set forth
as Exhibit B.

                  (g)  Appointments.  The  appointment of Benton Wilcoxon to the
board  of the  Parent  Company  and the  appointment  of not  less  than one (1)
reasonably  acceptable  Buyer nominated  person to the board of any other of the
EUE Companies as may be required by the Buyer at Closing;

                  (h) Legal  Opinion.  Sellers shall cause an opinion of counsel
to be delivered to Buyer substantially in the form set forth in Exhibit C;

                  (i) Other Documents.  All other documents reasonably requested
by Buyer to be delivered by the Sellers in connection  with the  consummation of
the transactions contemplated by this Agreement.

         3.3 Buyer Deliveries.  At the Closing,  Buyer shall deliver or cause to
be delivered:

                  (a) Buyer Shares. Stock certificates representing Buyer Shares
in the names of such of the  Sellers  as have  agreed to sell  their  holding of
Parent Company Shares as of Closing in accordance with Section 2.2.

                  (b) Buyer  Secretary  Certificate.  A  certificate,  dated the
Closing  Date,  signed by the  secretary of Buyer  certifying on behalf of Buyer
that all  corporate  actions by Buyer  required  to  authorize  and  approve the
execution and delivery of this Agreement and the other  documents and agreements
provided for herein and the  transactions  contemplated  hereby and thereby have
been taken and setting forth copies of such corporate actions;

                  (c) Approvals and Consents. Copies of all permits, consents or
approvals of third parties or  Governmental  Authorities,  the granting of which
are necessary for the consummation of the transactions contemplated herein; and

                  (d) Other Documents.  All other documents reasonably requested
by the Sellers to be delivered by Buyer in connection  with the  consummation of
the transactions contemplated by this Agreement.

                                   ARTICLE IV
                     REPRESENTATIONS AND WARRANTIES RELATING
                             TO EACH EUE SHAREHOLDER

         Subject to the  provisions of Article IX hereof,  each EUE  Shareholder
and Michael Porter severally  hereby  represents and warrants to the Buyer as of
the  Closing  Date as follows in respect  of the Parent  Company  Shares  listed
against his name in Schedule A and/or himself only (as  applicable) and each EUE
Shareholder and Michael Porter hereby  acknowledges that Buyer is relying on the
following representations and warranties in entering into this Agreement.

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         4.1 Authority of Shareholders;  Enforceability. The EUE Shareholder and
its representative (if any) has all requisite power and authority,  corporate or
otherwise,  to execute  and deliver  this  Agreement  and the other  Transaction
Documents to which it is a party and to perform its  obligations  hereunder  and
thereunder.  The  execution  and  delivery  of  this  Agreement  and  the  other
Transaction  Documents  to  which  the  EUE  Shareholder  is  a  party  and  the
performance of the transactions  contemplated  hereby and thereby have been duly
and validly approved by such action, necessary on behalf of the EUE Shareholder.
This  Agreement  and  each  of  the  Transaction  Documents  to  which  the  EUE
Shareholder is a party  constitute the legal,  valid and binding  obligations of
the EUE Shareholder,  enforceable against the EUE Shareholder in accordance with
their terms, subject to applicable bankruptcy,  insolvency or other similar laws
relating to or affecting the enforcement of creditors'  rights  generally and to
general  principles of equity (such laws and principles being referred to herein
as "Creditors'  Rights").  All other documents required hereunder to be executed
and delivered by the EUE  Shareholder at the Closing have been duly  authorized,
executed and delivered by the EUE  Shareholder  and constitute the legal,  valid
and binding  obligations  of the EUE  Shareholder,  enforceable  against the EUE
Shareholder in accordance with their terms, subject to the Creditors' Rights.

         4.2 Consents of Shareholders; Absence of Conflicts. Except as set forth
on Schedule 4.2,  neither the  execution  and delivery of this  Agreement or the
other Transaction Documents by the EUE Shareholder,  nor the consummation of the
transactions  contemplated  hereby and thereby will (a) violate any provision of
the  Organizational  Documents  of such EUE  Shareholder  applicable  to any EUE
Shareholder  that is not a natural  person;  (b) violate or breach the terms of,
cause a default under, conflict with, result in the loss by the EUE Shareholders
of any rights or benefits  under,  impose on such EUE Shareholder any additional
or greater  burdens or  obligations  under,  create in any party  additional  or
greater rights or benefits  under,  create in any party the right to accelerate,
terminate,  modify or cancel,  require any notice or consent or give rise to any
preferential   purchase  or  similar  right  under  (i)  any  applicable   Legal
Requirement or (ii) any Contract to which such EUE  Shareholder is a party or by
which such EUE Shareholder,  or any of their respective properties, is bound; or
(c) with the passage of time or the giving of notice or the taking of any action
of any third  party  have any of the  effects  set forth in clause (a) or (b) of
this Section 4.2.  Except as set forth on Schedule 4.2, such EUE  Shareholder is
not required to obtain or provide any consent or notice in  connection  with the
consummation  of the  transactions  contemplated  by this  Agreement.  All  such
consents  or notices  have been  obtained  or given and have been  furnished  in
writing to the Buyer.

         4.3  Ownership.  The EUE  Shareholder  is the  beneficial  owner of the
number  of  shares  of the  Parent  Company  set  forth on  Schedule  A. The EUE
Shareholder  owns such shares of the Parent Company free and clear of all Liens.
Upon  delivery  of  stock  powers  relating  to the  Parent  Company  Shares  or
certificates  representing  the Parent  Company  Shares duly  endorsed to Buyer,
together  with  any  other  documents  reasonably  requested  by  Buyer,  the EU
Shareholder  at Closing will  transfer  valid title thereto to the Buyer and, in
relation to its own Parent Company Shares, such title shall be free of any Lien.

         4.4 Brokers' Fees. The EUE  Shareholder  does not have any liability or
obligation to pay any fees or  commissions  to any broker,  finder or agent with
respect to the  transactions  contemplated by this Agreement for which the Buyer
or its Affiliates  (including the EUE Companies  after the Closing) could become
liable or obligated.

         4.5 Access to Information. Each EUE Shareholder has had the opportunity
to  carefully  review  all  filings  of the Buyer  made with the  United  States
Securities and Exchange Commission at www.sec.gov.

         4.6 Sophistication and Knowledge. The EUE Shareholder is not relying on
the Buyer  with  respect  to the tax and  other  economic  considerations  of an
investment in the Shares,  and the EUE  Shareholder has relied on the advice of,
or has consulted with, only the EUE Shareholder's own advisor(s).

         4.7  Economic  Risk.  The  EUE   Shareholder   acknowledges   that  the
acquisition  of the Buyer  Shares  involves  a high  degree of risk and  further
acknowledges  that it can bear the economic  risk of the purchase of the Shares,
including the total loss of its investment.  Each EUE Shareholder  that is not a
US Person ("U.S. Person" as defined in Regulation S ("Regulation S") promulgated
by the Securities and Exchange Commission ("SEC") pursuant to the Securities Act
of 1933 (the "Securities Act")) acknowledges and understands that the Shares may
not be sold to a U.S.  Person or into the United  States for a period of one (1)
year from the date of purchase without  registration of such securities and that
such EUE  Shareholder  has no present need for liquidity in connection  with its
purchase of the Shares.  Each EUE Shareholder  that is a US Person  acknowledges
and  understands  that the Shares may not be sold without  registration  of such
securities except in compliance with rule 144 promulgated by the SEC pursuant to
the Securities Act or another  exemption  under the Securities Act and that such
EUE  Shareholder  has no  present  need for  liquidity  in  connection  with its
purchase of the Shares.  All EUE Shareholders  shall comply in all respects with
US federal and state securities laws, particularly with respect to any resale of
the Shares in any transaction subject to United States jurisdiction.

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         4.8 No Public Solicitation.  The EUE Shareholder is not subscribing for
the Buyer Shares as a result of or  subsequent  to any  advertisement,  article,
notice or other  communication  published in any newspaper,  magazine or similar
media or  broadcast  over  television  or radio,  or presented at any seminar or
meeting,  or any solicitation of a subscription by a person not previously known
to the EUE Shareholder in connection with  investments in securities  generally.
Neither the Parent Company nor the EUE  Shareholder has engaged in any `Directed
Selling  Efforts in the U.S.' as defined in Regulation S promulgated  by the SEC
pursuant to the Securities Act.

         4.9  Requirements  for Transfer.  Each EUE Shareholder that is not a US
Person  understands and accepts that the Buyer shall not be required to transfer
the Buyer Shares unless (i) the transferee certifies that he, she or it is not a
U.S. Person, if such transfer is requested for unregistered  Shares prior to one
year from the Closing. All EUE Shareholders understand and accept that the Buyer
shall  not be  required  to  transfer  the Buyer  Shares  unless  such  transfer
otherwise  complies in all  respects  with all  applicable  US federal and state
securities laws. EUE  Shareholders  requiring the transfer of Buyer Shares shall
provide an opinion of counsel if reasonably requested by Buyer.

         4.10  Compliance  with Local Laws.  Any resale of the Buyer Shares by a
EUE  Shareholder  that is not a US Person  during the  `distribution  compliance
period'  as  defined  in Rule  902(f)  to  Regulation  S  shall  only be made in
compliance with exemptions from registration  afforded by Regulation S. Further,
any such sale of the Buyer  Shares in any  jurisdiction  outside  of the  United
States will be made in compliance with the securities laws of such jurisdiction.
No EUE  Shareholder  will  offer  to  sell  or  sell  the  Buyer  Shares  in any
jurisdiction unless such EUE Shareholder obtains all required consents,  if any,
and has complied with all applicable laws.

         4.11  Regulation S  Exemption.  Each EUE  Shareholder  that is not a US
Person  understands  that the Buyer  Shares are being  offered and sold to it in
reliance on an exemption  from the  registration  requirements  of United States
federal and state  securities  laws under  Regulation  S  promulgated  under the
Securities  Act and that the Buyer is relying upon the truth and accuracy of the
representations,  warranties, agreements,  acknowledgments and understandings of
the EUE Shareholders set forth herein in order to determine the applicability of
such  exemptions and the suitability of the EUE Shareholder to acquire the Buyer
Shares.  In  this  regard,  each  EUE  Shareholder  that  is not a  U.S.  Person
represents, warrants and agrees that:

                  (a) the EUE  Shareholder  is not a U.S.  Person  and is not an
Affiliate of the Buyer. A U.S. Person includes any one of the following:

                           i. any natural  person  resident in the United States
                  of America;

                           ii.  any  partnership  or  corporation  organized  or
                  incorporated under the laws of the United States of America;

                           iii.   any   estate   of  which   any   executor   or
                  administrator is a U.S. person;

                           iv. any trust of which any trustee is a U.S. person;

                           v. any agency or branch of a foreign  entity  located
                  in the United States of America;

                           vi. any non-discretionary  account or similar account
                  (other  than an  estate  or  trust)  held by a dealer or other
                  fiduciary for the benefit or account of a U.S. person;

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                           vii.  any  discretionary  account or similar  account
                  (other  than an  estate  or  trust)  held by a dealer or other
                  fiduciary  organized,   incorporated  or  (if  an  individual)
                  resident in the United States of America; and

                           viii. any partnership or corporation if:

                                    (1) organized or incorporated under the laws
                  of any foreign jurisdiction; and;

                                    (2) formed by a U.S. person  principally for
                  the purpose of investing in securities  not  registered  under
                  the Securities  Act,  unless it is organized or  incorporated,
                  and owned, by accredited EUE  Shareholders (as defined in Rule
                  501(a) under the Securities Act) who are not natural  persons,
                  estates or trusts.

                  (b) At the time of the origination of contact  concerning this
Agreement and the date of the execution and delivery of this Agreement,  the EUE
Shareholder was outside of the United States.

                  (c) The EUE Shareholder will not, during the period commencing
on the date of issuance of the Buyer Shares and ending on the first  anniversary
of such date,  or such shorter  period as may be  permitted  by  Regulation S or
other applicable securities law (the "Restricted  Period"),  offer, sell, pledge
or otherwise  transfer the shares in the United States,  or to a U.S. Person for
the account or for the benefit of a U.S.  Person,  or otherwise in a manner that
is not in  compliance  with  Regulation S or otherwise in  compliance  with U.S.
securities laws.

                  (d)  The  EUE  Shareholder   will,  after  expiration  of  the
Restricted  Period,  offer,  sell, pledge or otherwise transfer the Buyer Shares
only pursuant to registration under the Securities Act or an available exemption
therefrom  and, in accordance  with all  applicable  federal,  state and foreign
securities laws.

                  (e) Neither the EUE  Shareholder  nor any person acting on its
behalf has engaged in, and prior to the expiration of the Restricted Period will
engage in, any short selling of or any hedging  transaction  with respect to the
Buyer  Shares,  including  without  limitation,  any put,  call or other  option
transaction, option writing or equity swap.

                  (f) Neither the EUE  Shareholder  nor or any person  acting on
its behalf has engaged,  nor will engage,  in any directed  selling efforts to a
U.S.  Person with  respect to the Buyer Shares and the EUE  Shareholder  and any
person  acting on its behalf have  complied  and will comply with the  "offering
restrictions" requirements of Regulation S under the Securities Act.

                  (g) The  transactions  contemplated by this Agreement have not
been  pre-arranged  with a buyer  located  in the  United  States or with a U.S.
Person,  and  are not  part  of a plan  or  scheme  to  evade  the  registration
requirements of the Securities Act.

                  (h) Neither the EUE  Shareholder  nor any person acting on its
behalf has  undertaken  or carried out any  activity for the purpose of, or that
could  reasonably be expected to have the effect of,  conditioning the market in
the United States, its territories or possessions,  for any of the Buyer Shares.
The EUE Shareholder agrees not to cause any advertisement of the Buyer Shares to
be published in any  newspaper or  periodical  or posted in any public place and
not  to  issue  any  circular   relating  to  the  Buyer  Shares,   except  such
advertisements  that include the  statements  required by Regulation S under the
Securities  Act, and only offshore and not in the U.S. or its  territories,  and
only in compliance with any federal, state and local applicable securities laws.

                  (i) Each certificate  representing the Buyer Shares sold under
Regulation S shall be endorsed  with the following  legends,  in addition to any
other  legend  required  to be placed  thereon  by  applicable  federal or state
securities laws:

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         "THE  SHARES  REPRESENTED  BY THIS STOCK  CERTIFICATE  WERE  OFFERED TO
         PERSONS WHO ARE NOT U.S.  PERSONS (AS DEFINED IN REGULATION S UNDER THE
         U. S.  SECURITIES ACT OF 1933, AS AMENDED ("THE  SECURITIES  ACT")) AND
         WITHOUT  REGISTRATION  WITH THE UNITED STATES  SECURITIES  AND EXCHANGE
         COMMISSION  UNDER THE SECURITIES ACT AND IN RELIANCE UPON  REGULATION S
         PROMULGATED  UNDER THE  SECURITIES  ACT.  TRANSFER  OF THESE  SHARES IS
         PROHIBITED,  EXCEPT IN ACCORDANCE  WITH THE PROVISIONS OF REGULATION S,
         PURSUANT  TO  REGISTRATION  UNDER THE  SECURITIES  ACT,  OR PURSUANT TO
         AVAILABLE EXEMPTION FROM REGISTRATION."

                   (j) The EUE  Shareholder  consents  to, and the Buyer  shall,
make a notation on its records and give  instructions  to any transfer  agent of
the Buyer in order to implement the restrictions on transfer of the Buyer Shares
set forth in this Article IV.

                  4.12 Regulation D Exemption.  Each EUE  Shareholder  that is a
U.S.  Person  ("U.S.  EUE  Shareholder")  represents  that  such  person  is  an
"Accredited  Investor" as that term is defined in Regulation D promulgated under
the Securities Act. Each U.S. EUE  Shareholder  represents that the Buyer Shares
being  acquired,  are being  acquired  solely for the account of such Person for
such  shareholder's  investment  and  not  with a view  to,  or  for  resale  in
connection  with,  any  distribution  in any  jurisdiction  where  such  sale or
distribution  would be precluded.  The U.S. EUE Shareholder is not acquiring the
Buyer  Shares  as a  result  of any  advertisement,  article,  notice  or  other
communication regarding the Buyer Shares published in any newspaper, magazine or
similar media or broadcast over  television or radio or presented at any seminar
or any other  general  solicitation  or  general  advertisement.  Such U.S.  EUE
Shareholder,  either  alone  or  together  with  its  representatives,  has such
knowledge, sophistication and experience in business and financial matters so as
to be capable of evaluating the merits and risks of the  prospective  investment
in the  Buyer  Shares,  and  has so  evaluated  the  merits  and  risks  of such
investment.  Such U.S. EUE  Shareholder  is able to bear the economic risk of an
investment  in the Buyer  Shares and, at the present  time,  is able to afford a
complete loss of such investment. Each certificate representing the Buyer Shares
sold  under  Regulation  D shall be  endorsed  with the  following  legends,  in
addition to any other legend required to be placed thereon by applicable federal
or state securities laws:

         "THESE  SECURITIES HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF
1933, AS AMENDED (THE  "SECURITIES  ACT"), OR ANY STATE  SECURITIES LAWS AND MAY
NOT BE SOLD OR  OTHERWISE  TRANSFERRED  OR  DISPOSED  OF EXCEPT  PURSUANT  TO AN
EFFECTIVE  REGISTRATION  STATEMENT  UNDER THE  SECURITIES ACT AND ANY APPLICABLE
STATE SECURITIES  LAWS, OR AN OPINION OF COUNSEL  SATISFACTORY TO COUNSEL TO THE
ISSUER THAT AN EXEMPTION  FROM  REGISTRATION  UNDER THE  SECURITIES  ACT AND ANY
APPLICABLE STATE SECURITIES LAWS IS AVAILABLE."

                                    ARTICLE V
                               MAJOR SHAREHOLDERS'
                         REPRESENTATIONS AND WARRANTIES
                          RELATING TO THE EUE COMPANIES

         Subject to the provisions of Article IX hereof,  the Major Shareholders
hereby, jointly and severally,  represent and warrant to Buyer as of the Closing
Date as follows  and the Major  Shareholders  hereby  acknowledge  that Buyer is
relying on the following  representations  and  warranties in entering into this
Agreement.

         5.1 Organization.  Each of the Parent Company and its Subsidiaries is a
company duly organized,  validly existing and in good standing under the laws of
the country of its organization. EUE US is a corporation duly organized, validly
existing and in good standing  under the laws of the State of Nevada.  The Major
Shareholders  have  delivered  to the  Buyer  true and  complete  copies  of the
Organizational  Documents of each of the EUE Companies,  each as amended to date
and presently in effect (collectively, the "EUE Organizational Documents").

         5.2  Qualification;  Power.  Each EUE Company is duly  qualified  to do
business in jurisdictions  where it has the permanent right of establishment and
is in good standing in each  jurisdiction in which the nature of the business as
now conducted or the character of the property  owned or leased by it makes such
qualification necessary, and a list of all such jurisdictions has been delivered
to the Buyer,  excepting  where  listed (as  applicable  to each EUE Company) on
Schedule 5.2. Each EUE Company has all requisite  corporate  power and authority
to own its  properties  and assets  and to carry on its  business  as  currently
conducted.

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         5.3  Consents;  Absence of  Conflicts.  Except as set forth on Schedule
5.3,  neither  the  execution  and  delivery  of  this  Agreement  or the  other
Transaction  Documents by the Sellers,  nor the consummation of the transactions
contemplated hereby and thereby will (a) violate or breach the terms of, cause a
default  under,  conflict  with,  result in the loss by any EUE  Company  of any
rights or benefits  under,  impose on any EUE Company any  additional or greater
burdens or obligations  under,  create in any party additional or greater rights
or  benefits  under,  create in any party  the right to  accelerate,  terminate,
modify or cancel, require any notice or consent or give rise to any preferential
purchase or similar right under (i) any applicable Legal  Requirement,  (ii) the
EUE Organizational Documents or (iii) any Contract to which any EUE Company is a
party or by which any EUE Company, or any of its properties, is bound, including
without  limitation,  the  Material  Contracts;  (b) result in the  creation  or
imposition  of any Lien on any of the EUE Assets or the Parent  Company  Shares;
(c)  result  in  the  cancellation,   forfeiture,   revocation,   suspension  or
modification of any EUE Asset or any existing consent, approval,  authorization,
license, permit, certificate or order of any Governmental Authority; or (d) with
the  passage  of time or the giving of notice or the taking of any action of any
third party have any of the effects set forth in clause (a),  (b) or (c) of this
Section 5.3.  Except as set forth on Schedule 5.3, no EUE Company is required to
obtain or provide any consent or notice in connection  with the  consummation of
the  transactions  contemplated by this Agreement.  All such consents or notices
have been obtained or given and have been furnished in writing to Buyer.

         5.4 Capitalization.

                  (a)  Schedule  5.4 sets  forth a true and  complete  list that
accurately reflects the outstanding Interests in each EUE Company.  Schedule 5.4
also lists all names and the number of shares  held by each  shareholder  of the
Parent Company.

                  (b) The issued and outstanding  shares of capital stock of the
EUE Companies (the "EUE Company Shares") have been duly authorized,  are validly
issued and are fully paid and  non-assessable  and were not issued in  violation
of, and are not subject to, any  preemptive  rights,  rights of first refusal or
other  similar  rights of any Person.  No EUE Company Share has been redeemed or
repurchased and no capital in respect of any EUE Company Share has been repaid.

                  (c) There are no shares of  capital  stock of any EUE  Company
outstanding  other than as  reflected  in Schedule  5.4.  There are no Contracts
(including, without limitation,  options, warrants, calls and preemptive rights)
obligating any Seller or any EUE Company (i) to issue, sell, pledge,  dispose of
or encumber  any  Interests  in such EUE  Company,  (ii) to redeem,  purchase or
acquire  in any manner any  Interests  in such EUE  Company or (iii) to make any
dividend or  distribution  of any kind with respect to any Interests in such EUE
Company.

                  (d)  Except  as  set  forth  in  Schedule  5.4,  there  are no
outstanding   or  authorized   stock   appreciation,   phantom   stock,   profit
participation,  or similar  rights  affecting  the Interests in any EUE Company.
There are no voting trusts,  proxies, or other shareholder or similar agreements
or understandings  with respect to the voting of the Interests in any of the EUE
Companies.

         5.5 Subsidiaries. Other than any EUE Company and except as disclosed on
Schedule 5.5, there are no, and there have not been any, Persons  (including any
joint ventures) in which an EUE Company owns, or, has owned during the past five
years, of record or beneficially,  any direct or indirect  (through a subsidiary
or otherwise) Interest.  There are no outstanding obligations of any EUE Company
to provide funds or make any  investment (in either case, in the form of a loan,
capital  contribution,  purchase  of an  Interest  (whether  from the  issuer or
another Person) or otherwise) in, any other Person.

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         5.6 Absence of Changes.

                  (a) Except as set forth on Schedule 5.6, since March 31, 2006:

                           (1) there has not been any Material Adverse Effect;

                           (2) the Business has been operated and  maintained in
the Ordinary Course of Business;

                           (3)   there  has  not  been  any   material   damage,
destruction or loss to any material portion of the EUE
Assets, whether covered by insurance or not;

                           (4) there has  been no  merger  or  consolidation  of
any EUE Company  with any other  Person or any  acquisition  by any EUE  Company
of the stock,  material  assets or business of any other Person or any agreement
with respect thereto;

                           (5) there has been no (i)  issuance of any  Interests
in any EUE Company, (ii) any repurchase or  redemption  of any  Interests in any
EUE Company, or (iii) split, combination or  reclassification  of any  Interests
in any EUE Company;

                           (6) there has been no  declaration  or payment of any
dividend or other payment on the Interests in any
EUE Company;

                           (7) there has been no borrowing  of funds,  agreement
to borrow funds, or guaranty or agreement to maintain the financial  position of
any Person by any EUE Company;

                           (8) no EUE Company has entered  into any  employment,
consulting, severance or indemnification agreement or an agreement  with respect
to a retention  bonus with any of its employees or any  other  Person,  nor  has
any EUE  Company incurred  or  entered  into any collective bargaining agreement
or other obligation to any labor organization or employee;

                           (9)  there  has been no  actual,  pending  or, to the
Knowledge   of  the  Major  Shareholders,  threatened,  adverse  change  in  the
relationship  of any  EUE Company  with any customer,  supplier,  distributor or
sales  representative  of the Business;

                           (10)  there  has  been no  material  increase  in the
compensation or benefits of any director, officer or employee of any EUE Company
or the Business;

                           (11) other than the  repayment of the loans and other
payments as scheduled on Schedule 5.6(a)(11) there has  been no  payment  by any
EUE  Company  to any  director, officer,  member, partner, employee or holder of
any Interest in any EUE Company, or any Affiliate  of the foregoing  (whether as
a loan or otherwise) except regular  compensation, expense   reimbursements  and
usual  benefits  payments  consistent  with  past practices;

                           (12) no EUE Company has  entered  into any  contract,
agreement or arrangement with any  director, officer,  member, partner, employee
of  or  holder  of  any  Interest  in  any EUE  Company or  any Affiliate of the
foregoing; and

                           (13) there is no Contract to do any of the foregoing,
except as expressly permitted by this Agreement.

                  (b) Except as set forth on Schedule 5.6,  since April 1, 2005,
no EUE Company has sold or disposed of any of its  material  assets  (other than
any such sales of products in the Ordinary  Course of Business and  transfers to
other EUE Companies).

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Share Exchange Agreement - CTC & Shareholders of EU Energy plc           Page 10
<PAGE>
         5.7  Affiliate  Transactions.  Schedule 5.7  describes all services and
assets owned,  licensed to or otherwise  held by any EUE  Shareholder  or any of
their respective  Affiliates (other than an EUE Company),  that are or were made
available  or provided to or used by an EUE Company or the  Business  within the
one-year  period prior to the date of this Agreement or which may be required to
operate  the  Business  from and after the  Closing  Date  consistent  with past
practices in the preceding year. Except as set forth in Schedule 5.7, (a) no EUE
Company is  obligated  to pay  currently or in the future any amounts to any EUE
Shareholder  or  any  of  their  respective   Affiliates  save  under  customary
employment or consultancy  arrangements in the ordinary course of business,  and
none of the EUE Shareholders nor any of their respective Affiliates is obligated
to pay  currently  or in the future any amounts to any EUE Company and (b) since
April 1, 2005, no EUE Company has  purchased,  transferred or leased any real or
personal  property  from or for the benefit of any EUE  Shareholder  or of their
respective  Affiliates  and no EUE Company has sold,  transferred  or leased any
real  or  personal  property  to any  EUE  Shareholder  or of  their  respective
Affiliates.

         5.8 Real Property.

                  (a)  No  EUE  Company  owns  any  real  or  freehold  property
(beneficially or of record).

                  (b) Except as set forth in Schedule 5.8(b),  the Due Diligence
Documents  set forth a complete and accurate list with copies of all real estate
leases  pursuant  to which the EUE  Companies  lease real  property  ("Scheduled
Leases").  Each of the EUE  Companies  has valid  and  enforceable  leases  with
respect  to the real  property  that is  leased to the EUE  Companies.  The real
property leased by the EUE Companies is appropriate and adequate for purposes of
conducting  their respective  businesses as currently being conducted.  The real
property leased by the EUE Companies is not and is not reasonably expected to be
subject to any liens,  administrative measures or litigation which may adversely
affect their value or use.

                  (c) The business  conducted by the EUE Companies on the Leased
Real  Property is duly  authorized  by the  applicable  lease  agreements.  Such
agreements do not provide that the lessee shall be  responsible  for the cost of
any works required to bring any buildings into  conformity  with applicable laws
and regulations or otherwise. No event or condition exists, or is alleged by any
other  party,  to  have  occurred  or  exist,  which  constitutes  a  basis  for
termination of any such agreements.

                  (d) To the  knowledge of the Major  Shareholders  no decisions
have been taken by any  competent  authority  which is  reasonably  expected  to
adversely  affect the  permitted  use of any of the real property used by any of
the Companies.

                  (e) The real property leased pursuant to the Scheduled  Leases
constitutes all of the real property  ("Leased Real Property")  which is used in
connection  with the ownership and operations of the Business.  The Sellers have
furnished  Buyer  with true and  complete  copies of all  deeds,  leases,  title
opinions,  title  insurance  policies  and surveys in its  possession  or in the
possession  of any of the  EUE  Companies  that  relate  to the  Real  Property,
together with copies of all reports of any engineers,  environmental consultants
or other  consultants  in their  possession  relating  to any of the Leased Real
Property.

                  (f) All utilities (including, without limitation, water, sewer
or septic, gas, electricity,  trash removal and telephone service) are available
to the Leased Real Property in sufficient  quantities  and quality to adequately
serve the Leased Real Property in connection  with the operation of the Business
conducted therefrom as such operations are currently conducted thereon.

         5.9 Personal Property.

                   The EUE Companies  own or lease all of the tangible  personal
property (the "Personal Property")  necessary for the continued  ownership,  use
and operation of the Business  consistent in all material respects with the past
practices of EUE Companies  since July 4, 2005 and with the practices of the EUE
Companies  as of the date hereof.  Except as set forth on Schedule  5.9, the EUE
Companies have good and marketable title to such Personal Property and all other
tangible  personal  property used or held for use by the EUE Companies or any of
their  Affiliates in connection  with the Business,  free and clear of all Liens
except Permitted Liens.  Upon the consummation of the transactions  contemplated
by this  Agreement,  the EUE  Companies  will  have good  title to the  Personal
Property and such other tangible  personal  property free and clear of all Liens
except Permitted Liens.  Each item of Personal Property is in good working order
and repair in all material  respects  (taking its age and ordinary wear and tear
into  account),  has been  operated and  maintained  in the  Ordinary  Course of
Business and remains in suitable and adequate condition in all material respects
for use consistent with its primary use since July 4, 2005 (or later acquisition
date). The EUE Companies and their  Affiliates have not deferred  maintenance of
any  such  item  in  contemplation  of the  transactions  contemplated  by  this
Agreement.

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<PAGE>
          5.10  Permits.  A full and  complete  list of all  permits,  licenses,
certificates, authorizations and approvals granted by any Governmental Authority
(each,  a "Permit")  and used or held by an EUE Company in  connection  with the
ownership of the EUE Assets and used in the  Ordinary  Course of Business of the
EUE  Companies  (the  "Scheduled  Permits")  is  included  in the Due  Diligence
Documents and has been delivered to the Buyer. The Scheduled Permits  constitute
all Permits  necessary  for the  continued  ownership,  use and operation of the
Business  consistent  in all material  respects  with the past  practices of the
Business.  Except as set forth in Schedule 5.10, the Scheduled Permits are valid
and in full force and effect and no EUE Company is in default,  and no condition
exists  that with  notice or lapse of time or both would  constitute  a default,
under any of the Scheduled Permits.

          5.11 Contracts.

                  (a) Each of the following  Contracts  used in connection  with
the Business to which an EUE Company is a party or by which it or its properties
is bound shall be referred to as a "Material Contract":

                           (1) any Contract or group of related  Contracts  that
provides  for  the  payment  by  an  EUE  Company  of  more  than $50,000 in any
consecutive  12-month  period or  more than $250,000 over the remaining  life of
such Contract other than a Contract that (A) is  terminable by any party thereto
giving notice of  termination  to the other party  thereto not more than 30 days
in  advance  of  the  proposed  termination  date and (B) even if so terminable,
contains  no  post-termination   obligations,   termination  penalties, buy-back
obligations or similar obligations;

                           (2) any Contract that constitutes a purchase order or
other  Contract  relating  to the sale,  purchase,  lease or provision by an EUE
Company of goods or services in excess of $50,000 in any 12-month period;

                           (3) any Contract  that grants any Person the right to
sell products  or provide services  within any geographical  region other than a
Contract   that  (A) is   terminable  by  any  party  thereto  giving  notice of
termination to the other party  thereto  not more than 30 days in advance of the
proposed   termination   date   and  (B) even  if  so  terminable,  contains  no
post-termination   obligations,   termination  penalties,  buy-back  obligations
or similar obligations;

                           (4) any Contract  that  purports to limit the freedom
of any EUE Company to compete in any line of business or to conduct business  in
any geographic location;

                           (5) any  Contract  that is for the  sale of  goods or
services by an EUE Company and which (A) was entered into by such EUE Company on
terms known at the time the  Contract  was entered  into not to be  commercially
reasonable  or (B) was entered into with the  expectation  that such EUE Company
would incur a loss;

                           (6) any Contract that was entered into outside of the
Ordinary Course of Business of the EUE Companies;

                           (7) any Contract  constituting a  partnership,  joint
venture, strategic alliances or other similar
arrangement;

                           (8)  any  Contract   relating  to  Indebtedness   for
Borrowed Money, any Contract creating a capital lease  obligation,  any Contract
for the sale of accounts  receivable,  any Contract  constituting a guarantee of
debt of any third  Person or any  Contract  requiring an EUE Company to maintain
the financial position of any other Person;

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<PAGE>
                           (9) any Contract in respect of Intellectual  Property
Rights  granted  to or by an  EUE  Company,  excluding  license  agreements  for
off-the-shelf commercial software;

                           (10) any lease  (including  any master lease covering
multiple items of personal  property) of any item or items of personal  property
with a rental  expense  under such lease  (whether for a single item or multiple
items) in excess of $50,000 in any consecutive 12-month period;

                           (11) any Contract  providing for the deferred payment
of any  purchase  price  including  any  "earn  out"  or  other  contingent  fee
arrangement;

                           (12) any  Contract  creating a Lien on any of the EUE
Assets that will not be fully discharged at or prior to the Closing;

                           (13) any Contract between an EUE Company,  on the one
hand,  and any EUE  Shareholder or any Affiliate of an EUE  Shareholder,  on the
other  hand  (including  any  Contract  providing  for  (i)  compensation,   the
acceleration  of  benefits  or the loss of any  rights  in  connection  with the
consummation  of  the  transactions  contemplated  by  this  Agreement  or  (ii)
indemnification by an EUE Company);

                           (14) any Contract  providing for the purchase or sale
of real property;

                           (15) any Contract with any Governmental Authority;

                           (16) any Contract  involving interest rate swaps, cap
or collar  agreements,  commodity  or  financial  future or option  contracts or
similar derivative or hedging Contracts; and

                           (17)  any  Contract  otherwise  material  to the  EUE
Companies.

                  (b) True and complete  copies  (including  all  amendments) of
each  Material  Contract  have  been  provided  to the  Buyer as part of the Due
Diligence  Documents if such Material  Contract is in writing;  if such Material
Contract is oral, a summary of the material terms of such Material  Contract has
been included in the Due Diligence Documents and such Material Contract has been
identified as an oral  Contract.  Except as disclosed in Schedule 5.11: (i) each
Material  Contract is the legal,  valid obligation of the EUE Company which is a
party  thereto,  and, any other Person party  thereto,  binding and  enforceable
against EUE Companies  and, any other Person party thereto,  in accordance  with
its terms subject to Creditors' Rights; (ii) each Material Contract has not been
terminated,  and neither the relevant EUE Companies  nor, any other Person is in
breach or default  thereunder,  and no event has  occurred  that with  notice or
lapse of  time,  or both,  would  constitute  a breach  or  default,  or  permit
termination,  modification in any manner adverse to the applicable EUE Companies
or  acceleration  thereunder;  (iii) no party has  asserted  or has  (except  by
operation of law) any right to offset,  discount or  otherwise  abate any amount
owing under any Material Contract except as expressly set forth in such Material
Contract;  (iv) there are no Material  Waivers  regarding any Material  Contract
that have not been disclosed in writing to Buyer; and (v) the Material Contracts
are  sufficient  for the EUE Companies to be able to carry on their  business in
the manner intended.

         5.12 Intellectual Property.

                  (a) A list of all EUE Registered  Intellectual  Property is at
Schedule 5.12 (a). All EUE Registered Intellectual Property is owned or licensed
by the EUE  Companies.  There are no  proceedings  or  actions  in which any EUE
Company is a named party and in which the EUE Registered  Intellectual  Property
is being claimed, attacked or opposed by any third party and that are pending as
of the date  hereof  before  any court or  tribunal  of  competent  jurisdiction
(including  the U.S.  Patent and  Trademark  Office  (the  "PTO") or  equivalent
authority  anywhere  in  the  world)  related  to  any  of  the  EUE  Registered
Intellectual  Property  or any other  such  proceeding  or action  that such EUE
Company has knowledge of (whether or not the EUE Company is a party thereto).

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                  (b) To the  Knowledge of the Major  Shareholders  each item of
EUE  Intellectual  Property  listed in  Schedule  5.12(a)  which is owned by the
stated EUE  Company is free and clear of any Liens  other than liens  arising in
the normal course of business of such EUE Companies  (excluding EUE Intellectual
Property  Rights  licensed  to  such  EUE  Company  under  any  license  and any
Intellectual Property Rights co-owned with any third party). To the Knowledge of
the Major  Shareholders  each EUE Company (i) owns  exclusively  all trademarks,
service  marks  and  trade  names  listed  in  Schedule  5.12(a)  and (ii)  owns
exclusively,  and has good title to, all copyrighted materials that comprise EUE
Company  products or other works of  authorship  that comprise the EUE Assets or
which the EUE Company otherwise  purports to own; provided,  however,  that such
works may incorporate  copyrighted works or works of authorship of third parties
which are  licensed  to or  co-owned  by the EUE  Company  or are in the  public
domain.

                  (c) To the extent that any EUE Intellectual  Property has been
developed or created by any Person  other than an EUE  Company,  the EUE Company
has a written  agreement  with such Person with respect  thereto and the Company
has either (i) obtained  ownership  of, and is the exclusive or co-owner of, all
such EUE Intellectual Property by operation of law or by valid assignment of any
such  rights or (ii) has  obtained a License  under or to such EUE  Intellectual
Property. Except as provided in Exhibit 5.12(c), no person is entitled to or has
claimed  any  payment  in  respect  of any of the  EUE  Registered  Intellectual
Property.  In particular,  the EUE Companies are not, and will not be, under any
obligation  to pay  compensation  to any  former or current  employee  under the
German Employee Invention Act (Gesetz uber Arbeitnehmererfindungen) and or under
the German Copyright Act (Urheberrechtsgesetz).

                  (d) Except in the ordinary course of business,  no EUE Company
has transferred  ownership of or granted any license of or other right to use or
authorized the retention of any rights to use any  Intellectual  Property Rights
that is or was EUE Intellectual  Property,  to any other Person other than to an
EUE Company.

                  (e)  The  EUE  Intellectual   Property   constitutes  all  the
Intellectual  Property  Rights  (other  than  patents,  copyright  or  trademark
registrations which may issue to an EUE Company) necessary to the conduct of the
EUE Companies' Business as it currently is conducted or as currently proposed to
be conducted.

                  (f) The  Contracts  listed in  Schedule  5.12 (f)  include all
contracts  to which an EUE Company is a party with  respect to any  Intellectual
Property Rights.  Except as set out in Schedule 5.12 (f). no Person other than a
EUE  Company has  ownership  rights to  improvements  made by the EUE Company in
Intellectual Property Rights which has been licensed to the EUE Company.

                  (g)  Schedule  5.12(g)  lists all  Contracts  between each EUE
Company and any other Person  wherein or whereby such EUE Company has agreed to,
or assumed,  any  obligation or duty to  indemnify,  reimburse,  hold  harmless,
guaranty or otherwise  assume or incur any  obligation or Liability or provide a
right of rescission with respect to the infringement or  misappropriation by the
EUE  Company or such other  Person of the  Intellectual  Property  Rights of any
Person other than the EUE Company.

                  (h) To the Knowledge of the Major Shareholders,  the operation
of the business of each EUE Company as currently  conducted does not infringe or
misappropriate  the  Intellectual  Property  Rights of any  Person  (other  than
patents  that  may  issue in the  future),  violate  the  rights  of any  Person
(including rights to privacy or publicity),  or constitute unfair competition or
trade  practices  under any  applicable  laws,  and no EUE Company has  received
written notice from any Person claiming that such operation or any act, product,
technology or service  (including  products,  technology  or services  currently
under  development)  of  such  EUE  Company  infringes  or  misappropriates  the
Intellectual  Property of any Person or constitutes  unfair competition or trade
practices  under any applicable law,  including  notice of third party patent or
other   Intellectual   Property  Rights  from  a  potential   licensor  of  such
Intellectual Property Rights.

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                  (i) To the Knowledge of the Major  Shareholders,  each item of
EUE Registered Intellectual Property is valid and subsisting,  and all necessary
registration,  maintenance,  renewal fees,  annuity fees and taxes in connection
with such  Registered  Intellectual  Property  have been paid and all  necessary
documents and  certificates in connection with such EUE Registered  Intellectual
Property have been filed with the relevant patent, copyright, trademark or other
authorities  in  the  United  States,  United  Kingdom,  Germany  or  any  other
jurisdiction,  as the case may be,  for the  purposes  of  maintaining  such EUE
Registered  Intellectual Property save in respect of EUE Registered Intellectual
Property which the relevant EUE Company has decided at its discretion and in the
ordinary  course of its  business to allow to lapse or to cease to  protect.  In
each case in which any EUE  Company has  acquired  any  Registered  Intellectual
Property  rights from any Person,  such EUE Company has  obtained an  assignment
sufficient to irrevocably  transfer such rights in such Registered  Intellectual
Property to the extent  required by such EUE Company to the EUE Company  and, to
the maximum extent provided for by, and in accordance with, applicable laws, the
EUE Company has recorded  each such  assignment  with the relevant  Governmental
Authority where such Registered  Intellectual Property is registered,  including
the PTO, the U.S.  Copyright  Office,  or their  respective  equivalents  in any
relevant foreign jurisdiction, as the case may be.

                  (j) There are no Contracts or Licenses between any EUE Company
and any other Person with respect to EUE Intellectual Property under which there
is any dispute known to any EUE Company  regarding the scope of such Contract or
License,  or performance under such Contract or License,  including with respect
to any payments to be made or received by the EUE Company thereunder.

                  (k) To the Knowledge of the Major  Shareholders,  no Person is
infringing or misappropriating any EUE Intellectual Property.

                  (l) Each EUE Company has taken  commercially  reasonable steps
to protect  such EUE  Company's  rights in  confidential  information  and trade
secrets of such EUE Company or to protect rights in confidential  information or
trade secrets  provided by any other Person to the EUE Company subject to a duty
of  confidentiality.  Without limiting the foregoing,  each EUE Company has, and
enforces,   a  policy  requiring  each  employee,   consultant  and  independent
contractor to execute  agreements  containing  appropriate  confidentiality  and
invention, copyright and other intellectual property provisions given the nature
of the individuals  appointment and all relevant  current and former  employees,
consultants and  independent  contractors of each EUE Company have executed such
an agreement.

                  (m)  To  the   Knowledge   of  the  Major   Shareholders   EUE
Intellectual  Property or product,  technology  or service of any EUE Company is
subject  to any order or action or  proceeding  instituted  by a  non-regulatory
third party that  restricts,  or that is reasonably  expected to restrict in any
manner, the use, transfer or licensing of any EUE Intellectual  Property by such
EUE Company or that may affect the validity,  use or  enforceability of such EUE
Intellectual Property.

                  (n) There is no order, action or proceeding pending or, to the
Knowledge of the Major  Shareholders,  threatened alleging that any (i) product,
technology,  service or publication of any EUE Company,  (ii) material published
or  distributed  by any EUE  Company or (iii)  conduct or  statement  of any EUE
Company  constitutes  material,  false  advertising  or  otherwise  violates any
applicable Law.

                  (o) Neither this Agreement nor any  transactions  contemplated
by this Agreement will result in any EUE Company granting any rights or licenses
with  respect to the EUE  Intellectual  Property  to any Person  pursuant to any
Contract  to which such EUE Company is a party or by which any of its EUE Assets
and EUE Intellectual Property is bound.

         5.13 Accounts Receivable. Except as disclosed in Schedule 5.13, each of
the  Accounts  Receivable  arose in the  Ordinary  Course of Business of the EUE
Companies and represents the genuine, valid and legally enforceable indebtedness
of the account debtor and no contra  account,  set-off,  defense,  counterclaim,
allowance or adjustment  (other than  discounts for prompt  payment shown on the
invoice)  has been  asserted  or, to the  Knowledge  of Major  Shareholders,  is
threatened  by any of the account  debtors of such Accounts  Receivable.  To the
Knowledge of the Major Shareholders, none of the account debtors of the Accounts
Receivable is involved in a bankruptcy or insolvency  proceeding or is generally
unable to pay its debts as they become due except as disclosed in Schedule 5.13.
The EUE Companies have good and valid title to the Accounts  Receivable free and
clear of all Liens except  Permitted  Liens.  No goods or services,  the sale or
provision of which gave rise to any Accounts  Receivable,  have been returned or
rejected by any account debtor or lost or damaged prior to receipt thereby.  Set
forth on Schedule 5.13 is a listing of aged Accounts  Receivable as of a date no
more than  seven  days  prior to the date  hereof.  The EUE  Companies  have not
written off any of its accounts receivable as uncollectible, except as set forth
on Schedule 5.13 or in the Financial  Statements.  To the knowledge of the Major
Shareholders,  all accounts  receivable  are fully  collectible  subject only to
reserves  expressly  provided on the  Financial  Statements of the EUE Companies
dated March 31, 2006.

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         5.14 Brokers' Fees.  Except as set forth on Schedule 5.14,  none of the
EUE Companies or any of their  Affiliates has any liability or obligation to pay
any fees or  commissions  to any broker,  finder,  or agent with  respect to the
transactions  contemplated  by this  Agreement for which Buyer or its Affiliates
(including  any of the EUE Companies  after the Closing)  could become liable or
obligated.

         5.15 Financial Statements.

                  (a)  Attached  hereto as  Schedule  5.15(a)  are copies of the
audited  balance sheet of the EUE Companies (on a  consolidated  basis) at March
31, 2006 and the related  audited  statements of income for the year then ended.
The Audited  Financial  Statements  are referred to sometimes as the  "Financial
Statements." Except as set forth on Schedule 5.15(a),  the Financial  Statements
(i) have been  prepared in  accordance  with  Applicable  Accounting  Standards,
consistently  applied  throughout  the  periods  covered  thereby,  (ii)  fairly
present,  in all  material  respects,  the  financial  condition  and results of
operations of the EUE Companies as of the  respective  dates thereof and for the
respective  periods  covered  thereby,   and,  in  the  case  of  the  Financial
Statements,  and (iii) have been provided from, and are in accordance  with, the
books and records of the EUE Companies.  Since March 31, 2006, there has been no
change in any accounting policies,  principles,  methods or practices, including
any  change  with  respect  to  reserves  (whether  for  bad  debts,  contingent
liabilities or otherwise), of the Company.

                  (b) The  March  31,  2006  balance  sheet  reflects  the  cash
position of the Parent Company as of such date.  Since March 31, 2006 and except
as provided in Schedule  5.6(a)(11),  the EUE  Companies  have not made any cash
payments or distributions  to any of the Major  Shareholders or repaid any loans
or  other  obligations  of the  EUE  Companies  in  favor  of  any of the  Major
Shareholders  or any of  their  Affiliates  except  in the  ordinary  course  of
business.

         5.16 No Undisclosed Liabilities.  Except as set forth on Schedule 5.16,
none of the EUE  Companies  nor the  Business has any  liability or  off-balance
sheet  undertakings,  and in particular none of them have granted any guarantees
(in any form  whatsoever,  including as a comfort  letter) or security  interest
with regard to, or assumed any liability for, the  performance of obligations or
liabilities  of  third  parties  (including  partners,  shareholders,  corporate
officers and  employees)  and there has been no  guarantee or security  interest
been extended or liability been assumed by any third party with regard to or for
the  performance of obligations or liabilities of the Companies,  other than (i)
liabilities  set  forth  on  the  Audited   Financial   Statements  and/or  (ii)
liabilities which have arisen after the date of the Audited Financial Statements
in the Ordinary Course of Business.

         5.17  Legal  Compliance.  Each  EUE  Company  is in  compliance  in all
material respects with all applicable Legal Requirements.

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         5.18 Taxes.  Except as disclosed  on Schedule  5.18 (i) all Tax Returns
required to be filed on or before the Closing Date by or with respect to the EUE
Companies or with respect to the income or  operations  of the EUE  Companies or
the EUE Assets have been duly and timely filed with the appropriate Governmental
Authority,  (ii) all Tax Items  required  to be included in each such Tax Return
have been so included and all such Tax Items and any other information  provided
in each such Tax Return are true, correct and complete in all material respects,
(iii) all Taxes owed by the EUE  Companies or owed with respect to the income or
operations of the EUE Companies or the EUE Assets,  including without limitation
value added taxes and sales taxes, that have become due have been timely paid in
full,  or if not due and payable,  have been  adequately  provided  for, (iv) no
penalty, interest or other charge is or will become due with respect to the late
filing of any such Tax  Return  or late  payment  of any such  Tax,  (v) all Tax
withholding and deposit  requirements  imposed with respect to the EUE Companies
or their  employees  or with  respect  to the  income or  operations  of the EUE
Companies  have been  satisfied  in full,  (vi) there are no Liens  (other  than
Permitted  Liens)  on any of the  EUE  Assets  or the  shares  of any of the EUE
Companies that arose in connection with any failure (or alleged  failure) to pay
any Tax,  (vii)  there is no claim  pending  or, to the  Knowledge  of the Major
Shareholders,  threatened by any  Governmental  Authority in connection with any
such Tax,  (viii) none of such Tax Returns is now under audit or  examination by
any  Governmental  Authority,  (ix)  there are no  agreements,  waivers or other
arrangements  providing  for an  extension of time with respect to the filing of
any such Tax Return or the  assessment or collection of any such Tax, (x) no EUE
Company is a party to any Tax  indemnity  agreement or  arrangement  and has any
obligation  to  indemnify  or make a payment to any person in respect of any Tax
for any past,  current  or future  period,  (xi) to the  Knowledge  of the Major
Shareholders,  no claim  has ever  been made by a  Governmental  Authority  in a
jurisdiction in which an EUE Company does not file Tax Returns that it is or may
be  required  to file a Tax Return in that  jurisdiction,  (xii) none of the EUE
Assets is held in an arrangement  that could be classified as a partnership  for
Tax  purposes,  (xiii) the EUE  Companies  will not be  required  to include any
amount in income for any  taxable  period as a result of a change in  accounting
method for any taxable  period  ending on or before the Closing Date or pursuant
to any  agreement  with any  Governmental  Authority  with  respect  to any such
taxable  period,  or to include in any period  ending after the Closing Date any
income that accrued in a prior period but was not recognized in the prior period
as a result of the  installment  method of  accounting,  the completed  contract
method of accounting, or the long-term contract method of accounting, (xiv) none
of the  transactions  contemplated  by this  Agreement  will  result  in any Tax
liability or the  recognition  of any material  item of income or gain to an EUE
Company,  (xv) none of the EUE Companies has benefited from any fiscal advantage
(including any subsidies) or favorable tax regime in exchange for  undertakings,
covenants or obligations by which it is still bound, directly or indirectly,  or
shall incur any  additional  burden after the Closing Date as a result of having
obtained a benefit  from any  fiscal  advantage  (including  any  subsidies)  or
favorable Tax regime, (xvi) none of the EUE Companies has recorded shares or any
other fixed assets  below their  adjusted  book  values,  (xvii) none of the EUE
Companies holds tainted shares that cannot be disposed of under a beneficial tax
regime  generally  applicable to the disposition of shares,  and (xviii) all Tax
relevant  transactions  and events  have been duly  documented  in the books and
records of the EUE Companies and all bookkeeping and relevant  business  records
(including  transfer  pricing  documentations)  have been properly  prepared and
retained  and are  available  for all tax  periods.  No EUE Company has made any
payments   representing   installments   of  corporation  tax  pursuant  to  the
Corporation Tax (Instalment Payments) Regulations 1998 in respect of any current
or preceding accounting periods and is not under any obligation to do so. No EUE
Company has paid since inception or will become liable to pay any penalty, fine,
surcharge or interest charged by virtue of the provisions of the TMA 1970 or any
other  applicable  law. The EUE Companies are each taxable  persons and are duly
registered for the purposes of VAT with quarterly prescribed accounting periods,
such  registration  not being  pursuant to paragraph 2 of Schedule 1 to the VATA
1994 or subject to any conditions imposed by or agreed with HM Revenue & Customs
and no EUE Company is (nor are there any  circumstances  by virtue of which they
may become)  under a duty to make  monthly  payments on account  under the Value
Added Tax (Payments on Account) Order 1993. The EUE Companies have complied with
all statutory provisions,  rules, regulations,  orders and directions in respect
of VAT.

         5.19  Inventory.  Each EUE Company owns its inventory free and clear of
all Liens  except  Permitted  Liens.  None of such  inventory  is covered by any
financing  statements  except those filed in connection  with  Permitted  Liens.
Except as disclosed on Schedule  5.19,  such  inventory was acquired for sale in
the Ordinary Course of Business and is in good and saleable condition and is not
obsolete, slow moving or damaged, except to the extent reflected in reserves set
forth in the Financial Statements. Such inventory is located at the locations as
noted on Schedule 5.19 and none of such inventory is subject to any consignment,
bailment,  warehousing or similar  arrangement,  except as set forth on Schedule
5.19.

         5.20  Litigation.  Except  has  been  disclosed  in the  Due  Diligence
Documents  or as set forth on  Schedule  5.20,  there are no  actions,  suits or
proceedings pending or, to the Knowledge of the Major  Shareholders,  threatened
at law or in equity,  or before or by any  Governmental  Authority or before any
arbitrator  of any kind,  against an EUE Company or any of its  Affiliates  that
affect or would affect the Business or the EUE Assets or the consummation of the
transactions contemplated hereby.

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         5.21 Product and Service Warranty.

                  (a) Except as  disclosed  in Schedule  5.21 the Due  Diligence
Documents have  identified and disclosed any warranty claim asserted  during the
three year  period  prior to the date hereof from which an EUE Company or any of
its Affiliates has incurred costs in excess of $50,000.

                  (b) Except as  disclosed  in Schedule  5.21 and  ignoring  any
matter with a value less than $50,000,  (i) there is no notice,  demand,  claim,
action, suit, inquiry, hearing, proceeding, notice of violation or investigation
of a civil,  criminal or administrative  nature before any court or governmental
or other regulatory or administrative agency, commission or authority against or
involving any product,  substance or material  (collectively,  a "Product"),  or
class  of  claims  or  lawsuits  involving  the  same  or  similar  EUE  Product
manufactured,  produced,  distributed  or sold by or on behalf of any of the EUE
Companies  which is  pending  or, to the  Knowledge  of the Major  Shareholders,
threatened,  resulting from an alleged defect in design, manufacture,  materials
or workmanship of any EUE Product manufactured, produced, distributed or sold by
or on behalf of any of the EUE  Companies,  or any alleged  failure to warn,  or
from any breach of implied warranties or representations,  (ii) to the Knowledge
of the Major Shareholders, there has not been any Occurrence (as defined below),
and (iii) there is not, nor is there under consideration or investigation by the
Companies,   any  Product  recall,   rework,   retrofit  or  post-sale   warning
(collectively  "Recalls")  conducted  by or  on  behalf  of  the  EUE  Companies
concerning any EUE Products manufactured, produced, distributed or sold by or on
behalf of the EUE Companies or, to the Knowledge of the Major Shareholders,  any
product  recall  conducted  by or on  behalf  of any  entity  as a result of any
alleged defect in any EUE Product supplied by the EUE Companies.

                  (c) For purposes of this Section 5.21,  the term  "Occurrence"
shall mean any accident,  happening or event which is caused or allegedly caused
by any alleged hazard or alleged  defect in  manufacture,  design,  materials or
workmanship,  including,  without  limitation,  any  alleged  failure to warn or
breach of express or implied warranties or representations,  with respect to, or
any  such  accident,  happening  or event  otherwise  involving  an EUE  Product
(including any parts or components) manufactured,  produced, distributed or sold
by or on behalf of the EUE Companies.

         5.22 Employees; Employee Relations.

                  (a)  Schedule  5.22(a)  identifies  for each EUE  Company  the
following:

                           (1)  any   increase   currently   planned  to  become
effective after the date of this Agreement in the total  compensation or rate of
total compensation (including, without limitation, normal bonus, profit-sharing,
pension benefits and other compensation) payable to each of its employees, other
than ordinarily scheduled increases based on seniority in the Ordinary Course of
Business;

                           (2) all  presently  outstanding  loans  and  advances
(other than  routine  travel  advances to be repaid or  formally  accounted  for
within 60 days) made by any EUE  Company  to, or made to any EUE Company by, any
director, senior manager or employee of any EUE Company; and

                           (3) all  transactions  outside of the Ordinary Course
of Business between any EUE Company and any of its directors, senior managers or
employees since January 1, 2005.

                  (b) Except as set forth on  Schedule  5.22(b) or to the extent
accrued as a current liability on the Audited Financial Statements, all bonuses,
all wage taxes and/or social security  contributions and all other sums to which
any employees of the EUE Companies  are entitled  prior to the Closing,  if any,
due and payable as of the Closing Date to employees  of the EUE  Companies  have
been  or  will  be  paid in  full  to  such  employees  prior  to  Closing.  The
compensation and benefits  (including  vacation  benefits) paid or provided with
respect  to all  employees  of the EUE  Companies  have  been  reflected  in the
Financial  Statements for the periods  covered  thereby.  Except as set forth on
Schedule  5.22(b),  as of the  date of this  Agreement,  no  current  or  former
employee of an EUE Company is on a  disability  leave of absence,  is  receiving
disability  benefits,  or is in an  elimination  or other  waiting  period  with
respect to his or her receipt of disability  benefits.  The EUE  Companies  have
effected  all  increases  in pension,  survivor,  disability  and  medical  care
benefits as required under applicable laws and regulations.

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                  (c) Except as disclosed on Schedule 5.22(c), no EUE Company is
a party to, or is bound by, the terms of any  collective  bargaining  agreement,
shop agreements  (Betriebsvereinbarungen),  or any other Contract with any labor
union  or  representative  of  employees,  and  no  such  agreements  are  being
negotiated.  With respect to employees based in Germany, to the Knowledge of the
Major  Shareholders,  none of the EUE  Companies  has  established  any material
special  employees'  rights by way of a regular practice  (betriebliche  Ubung).
Except as set forth on Schedule  5.22(c),  there are no labor disputes  existing
or, to the Knowledge of the Major Shareholders,  threatened involving, by way of
example,   strikes,  work  stoppages,   slowdowns,   picketing,   or  any  other
interference  with work or  production  and no EUE Company has  experienced  any
labor  difficulties  during the last year.  No  grievance  or other legal action
arising out of any such collective  bargaining agreement or relationship exists,
or to the Knowledge of the Major Shareholders, is threatened.

                  (d) The  relationship  of each EUE Company with its employees,
as a group,  is  satisfactory  and, to the Knowledge of the Major  Shareholders,
such  employees  have not indicated  that they will not continue in their employ
following the Closing.  Except as listed on Schedule 5.22(d),  no EUE Company is
(i) a party to any employment, consulting,  non-compete,  management, severance,
termination  pay or similar  Contract with any  individual  or employee,  either
express  or  implied,  or (ii)  currently  negotiating,  and  does  not have any
outstanding offer with respect to, any such agreement or matter.

                  (e) No legal proceedings,  charges, complaints,  grievances or
similar  actions  have  been  commenced  or,  to  the  Knowledge  of  the  Major
Shareholders,  threatened,  with  respect  to any EUE  Company  under  any Legal
Requirement affecting the employment  relationship,  and to the Knowledge of the
Major Shareholders, no facts or circumstances exist which would give rise to any
such proceedings,  charges,  complaints, or claims. No EUE Company is subject to
any settlement or consent decree with any present or former  employee,  employee
representative   or  any   Governmental   Authority   relating   to   claims  of
discrimination or other claims in respect of employment  practices and policies.
No Governmental  Authority has issued a judgment,  order, decree or finding with
respect to the labor and employment  practices  (including practices relating to
discrimination) of any EUE Company.

                  (f) To the  Knowledge  of the  Major  Shareholders,  each  EUE
Company is and has been in compliance  with all  applicable  Legal  Requirements
relating to the employment of labor, including but not limited to employment and
employment  practices,  terms and  conditions  of  employment,  wages and hours,
payroll documents, equal opportunity, occupational health and safety, severance,
termination  or  discharge,  collective  bargaining  and the payment of employee
welfare and  retirement  and other Taxes,  and no EUE Company is in violation of
any Legal Requirements concerning retention of independent contractors.

                  (g)  None of the EUE  Companies  has made  any  commitment  in
connection  with any  collective  dismissal that has not been performed in full,
nor has any of the EUE Companies  made any  commitment  in  connection  with any
future collective dismissal or reorganization.

                  (h) Neither the execution and delivery of this Agreement,  nor
the consummation of the  transactions  contemplated  hereby,  either alone or in
combination  with another  event  (whether  contingent  or  otherwise)  will (i)
entitle any current or former employee,  consultant,  director or officer of any
of the EUE  Companies  to any  increased  or modified  benefit or payment;  (ii)
increase  the  amount  of  compensation  due to any such  employee,  consultant,
director or officer; or (iii) accelerate the vesting,  payment or funding of any
compensation, stock-based benefit, incentive or other benefit.

                  (i)  Schedule   5.22(i)  sets  forth  a  description   of  the
obligations of the EUE Companies  vis-a-vis bodies representing their employees,
insofar as such  obligations  exceed those provided for by Law or the collective
status referred to in Section 5.22(c).

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                  (j) The Sellers have caused the workers' committees of the EUE
Companies to be informed of and/or consulted,  as required under applicable Law,
in  connection  with  the  execution  of this  Agreement  and  the  transactions
contemplated hereunder.

                  (k) Exhibit 5.22(k) sets forth all  undertakings,  obligations
and  agreements  of any EUE Company  made  vis-a-vis  or with former  employees,
officers or directors, which have not yet been fully discharged or terminated.

         5.23 Employee Benefit Matters.

                  (a) Schedule  5.23 lists each of the  following  (collectively
referred to as the "Plans," and  individually  referred to as a "Plan") which is
sponsored, maintained or contributed to or by any EUE Company for the benefit of
the  current  or former  employees,  senior  managers  or  directors  of any EUE
Company, or has been so sponsored, maintained or contributed to within six years
prior to the Closing Date:

                           (1) each  personnel  policy,  stock  option  or stock
bonus  plan,  collective  bargaining  agreement,   bonus  plan  or  arrangement,
incentive  award plan or  arrangement,  fringe  benefits  (e.g.,  company cars),
advantages in kind,  vacation policy,  severance pay plan,  policy or agreement,
retention or other agreement,  deferred  compensation  agreement or arrangement,
profit sharing agreement or arrangement,  executive compensation or supplemental
income or  retirement  arrangement  or any other  long-term  incentive or equity
based plan, policy, agreement or arrangement,  such as stock appreciation rights
or phantom stock,  incentive and company savings schemes,  consulting agreement,
employment   agreement  and  each  other  employee   benefit  plan,   agreement,
arrangement,  program,  practice  or  understanding  which is not  described  in
Section 5.23(a)(1); and

                           (2) any  regional,  local or  individual  company  or
establishment   practices  which  provide  for  advantages  which  exceed  those
resulting from applicable laws.

                  (b) True,  correct and  complete  copies of each of the Plans,
and related trusts, if applicable,  including all amendments thereto,  have been
furnished  or made  available  to Buyer.  There has also been  furnished or made
available to Buyer, with respect to each Plan and to the extent applicable:  (i)
the most recent annual or other report filed with each  Governmental  Authority,
(ii) the insurance  contract and other  funding  agreement,  and all  amendments
thereto, and (iii) the most recent summary plan description.

                  (c)  Except  to  the  extent  set  forth  in  accordance  with
applicable laws, no Plan or Contract listed on Schedule 5.23(c) provides retiree
medical or retiree life insurance  benefits to any Person,  and EUE Companies is
not contractually or otherwise  obligated (whether or not in writing) to provide
any  Person  with  life  insurance  or  medical   benefits  upon  retirement  or
termination of employment.

                  (d)  Each  EUE  Company  has   substantially   performed   all
obligations,  whether  arising  by  operation  of any  Legal  Requirement  or by
contract,  required to be performed by it in connection with the Plans, and each
Plan  has  been  administered  in  substantial  compliance  with  its  governing
documents and  applicable  Legal  Requirements.  There are no actions,  suits or
claims  pending (other than routine claims for benefits) or, to the Knowledge of
the Major Shareholders, threatened against, or with respect to, any of the Plans
or their assets, and there is no matter pending with respect to any of the Plans
before any Governmental  Authority.  Except for the Plans, there are no employee
benefit plans,  that are sponsored,  maintained or contributed  to, or have been
sponsored,  maintained or  contributed  to within six years prior to the Closing
Date, by any EUE Company or any Affiliate of an EUE Company.

                  (e)  Except  as listed in  Schedule  5.23(e),  none of the EUE
Companies had in the past  compensation  plans in place,  including any deferred
compensation  plan,  profit sharing plan, gain sharing plan,  stock option plan,
stock bonus plan, executive compensation plan, executive perquisites,  executive
supplemental  retirement  plan or any other  long-term  incentive  plan, such as
stock  appreciation  rights or  phantom  stock.  None of the EUE  Companies  has
disseminated  in writing or otherwise  generally  notified its  employees of any
intent or commitment (whether or not legally binding) to create or implement any
additional  employee benefit plan or to amend,  modify or terminate any existing
employee benefit plan.

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<PAGE>

                  (f) Except as disclosed in Schedule  5.23(f) or required under
German  statutory  social  security  law,  with  respect to  employees  based in
Germany,  no Company has committed to pay retirement or other benefits to any of
its current or former employees. Pension accruals have been, or will be, made in
the statutory  annual accounts of the German EUE Companies as of March 31, 2004,
up to the maximum amount permitted under Section 6a of the German Income Tax Act
(Einkommensteuergesetz).

                  (g) Other than the  obligation on Parent Company to contribute
to the personal  pension plans of Mr. Stuart Jackson and Mr. Victor Lilly as set
forth in the Due Diligence  Documents (the "Personal  Pension  Plans") and other
than the  obligation  of the EUE  Companies to provide  health plan  benefits to
Porter and Stephen  Bircher as set out in their  service/consultancy  agreements
(copies of which are in the Due  Diligence  Documents)  no EUE  Company  has any
obligation  (legally  binding or  otherwise)  to provide or  contribute  towards
pension benefits,  death benefits or healthcare  benefits in respect of its past
or present  officers  or  employees.  Parent  Company has  fulfilled  all of its
obligations under the Personal Pension Plans.

                  (h) Parent Company has a designated stakeholder pension scheme
in accordance with the  requirements of the Welfare Reform and Pensions Act 1999
(and the  regulations  made  under  it) and has at all times  complied  with its
obligations  under that Act in relation to all of its "relevant  employees"  (as
defined for the purposes of that Act) and full details of that designated scheme
are set out in Schedule 5.23.

                  (i) No unlawful  discrimination on grounds of sex, disability,
marital status, hours of work, sexual orientation,  religion or belief is or has
at any stage been made in the  provision  of pension  benefits,  death  benefits
and/or healthcare benefits by any EUE Company.

                  (j) So far as the  Major  Shareholders  are aware no claims or
complaints  have been made or are  pending in respect  of the  provision  of (or
failure to provide) pension benefits,  death benefits or healthcare  benefits by
any employee of a EUE Company.  No proposal or announcement has been made to any
employee  of a EUE  Company  or  to  any  officer  of a EUE  Company  about  the
introduction,  continuance,  increase or  improvement  of any pension  benefits,
death benefit or healthcare benefit.

         5.24 Environmental Matters.

                  (a) The EUE Companies  have  obtained all  licenses,  permits,
authorizations,  approvals and consents from Governmental  Authorities which are
required under any applicable environmental law and necessary for it to carry on
its activities and operations as currently conducted ("Environmental  Permits").
All such  Environmental  Permits  are in full  force and  effect and will not be
adversely  affected by the  consummation of this Agreement and the  transactions
contemplated  hereby.  The EUE Companies  are in  compliance  with the terms and
conditions  of  all  such  Environmental  Permits,  and  have  been  and  are in
compliance with all applicable environmental laws.

                  (b) No  Environmental  Claims are pending or, to the Knowledge
of the Major Shareholders threatened, with respect to any of the EUE Companies.

(c) No past or present actions,  conditions or incidents with respect to the EUE
Companies,  the associated properties or assets, or the activities or operations
thereon,  including,  without limitation,  the emission,  discharge,  release or
disposal (on-site or off-site) of any hazardous materials, require notification,
investigation or remediation,  or are reasonably likely to give rise to costs or
liabilities, pursuant to applicable environmental laws.

         5.25 Customers,  Vendors and Suppliers. To the best belief of the Major
Shareholders,  there is no present  intent of any  customer,  vendor or supplier
material to the Business to discontinue or substantially  alter its relationship
as such with the Business or EUE Company upon  consummation of the  transactions
contemplated hereby.

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         5.26 Bank Accounts;  Powers of Attorney.  Schedule 5.26 sets forth each
bank,  savings  institution  and other financial  institution  with which an EUE
Company  has an  account  or  safe  deposit  box and the  names  of all  persons
authorized  to draw  thereon or to have access  thereto.  Except as disclosed on
Schedule 5.26, no EUE Company has given any revocable or  irrevocable  powers of
attorney or similar  grant of authority  to any Person  relating to its business
for any purpose whatsoever.

         5.27 Insurance. Except as set forth in Schedule 5.27, the Due Diligence
Documents  sets forth a true and complete  list of all  policies,  binders,  and
insurance  contracts  with  copies  of all such  documents  under  which any EUE
Company,  the  Business  or any of the EUE  Assets is  insured  (the  "Insurance
Policies").   With  respect  to  each  Insurance  Policy,  a  true  and  correct
description  of (a) the scope of  coverage,  (b) the  limits of  liability,  (c)
deductibles  and  other  similar  amounts,  and (d)  the  aggregate  limits  and
available  coverage (if less than the  aggregate  limits) has been  delivered as
part of the Due Diligence  Documents.  Each of the Insurance Policies is in full
force and effect,  there has been no written notice of any  cancellation  or any
threatened cancellation of any Insurance Policy.

         5.28 Books and Records. All books and records relating to the ownership
and  operation of the Business and the EUE Assets are located at the premises of
the  Business  to which  such  books and  records  primarily  relate,  have been
maintained  substantially in accordance with applicable  Legal  Requirements and
comprise all of the material  books and records  relating to the  ownership  and
operation of the Business and the EUE Assets.

         5.29 Certain  Payments.  (a) Except as set forth in Schedule  5.29,  no
finder's fee or other  payment has been, or will be, made by or on behalf of any
of the EUE Companies in respect of, or in connection with, any commitment to any
Person which is not a party to such commitment.  Except as set forth in Schedule
5.29, no funds or assets of any of the EUE Companies  have been used for illegal
purposes;  no unrecorded  funds or assets of any of the EUE Companies  have been
established  for any  purpose;  no  accumulation  or use of the  EUE  Companies'
corporate funds or assets has been made without being properly  accounted for in
the books and records of such EUE Company;  all payments by or on behalf of each
of the EUE Companies  have been duly and properly  recorded and accounted for in
their  respective  books and records;  no fraudulent  entry has been made in the
books and records of any of the EUE  Companies  for any  reason;  no payment has
been  made by or on behalf of any of the EUE  Companies  with the  understanding
that any part of such  payment  is to be used for any  purpose  other  than that
described  in the  documents  supporting  such  payment;  and  none  of the  EUE
Companies has made,  directly or indirectly,  any illegal  contributions  to any
political party or candidate, either domestic or foreign.

                  (b)  Neither  any  EUE  Company  nor  any  director,  officer,
employee  has made any direct or  indirect  unlawful  payment to any  foreign or
domestic  governmental  official or employee, or made any illegal bribe, rebate,
payoff, influence payment, kickback or other unlawful payment in connection with
the Business. To the Knowledge of the Major Shareholders,  neither any agent nor
any other person associated with or acting on behalf of any EUE Company has made
any direct or indirect unlawful payment to any foreign or domestic  governmental
official or  employee,  or made any illegal  bribe,  rebate,  payoff,  influence
payment, kickback or other unlawful payment in connection with the Business.

         5.30  Information  All  information  relating  to  the  Parent  Company
contained  in the letter from Parent  Company to its  shareholders  dated 23 May
2006 was at such date and will be at Closing  true,  complete,  accurate and not
misleading.  Each EUE Company has fully disclosed or made available to the Buyer
any fact,  matter or  occurrence  that is or could  reasonably be expected to be
material in the context of such EUE Company's current financial position.

         5.31 Subsidies.  None of the EUE Companies has been granted any subsidy
by any  Governmental  Authority which the EUE Company is obliged to repay either
in full or in part until the  Closing,  or would be  obliged to repay  either in
full or in part subsequent to the Closing as a result of any of the transactions
contemplated by this Agreement.

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<PAGE>

                                   ARTICLE VI
                     REPRESENTATIONS AND WARRANTIES OF BUYER

         Buyer  represents and warrants to the Sellers as of the Closing Date as
follows. Buyer hereby acknowledges that the Sellers are relying on the following
representations and warranties in entering into this Agreement.

         6.1  Organization.  Buyer is a corporation duly  incorporated,  validly
existing and in good standing under the laws of the State of Nevada.

         6.2 Authority;  Enforceability. Buyer has all requisite corporate power
and authority to execute and deliver this  Agreement  and any other  Transaction
Documents to which it is a party and to perform its  obligations  hereunder  and
thereunder.  The  execution  and  delivery  of  this  Agreement  and  the  other
Transaction  Documents  to which  Buyer is a party  and the  performance  of its
obligations  contemplated hereby and thereby have been duly and validly approved
by all corporate action necessary on behalf of Buyer. This Agreement and each of
the Transaction Documents to which Buyer is a party constitutes the legal, valid
and binding  obligations  of Buyer,  enforceable  against it in accordance  with
their  terms,  subject  to  Creditors'  Rights.  All  other  documents  required
hereunder  to be executed  and  delivered by Buyer at the Closing have been duly
authorized,  executed  and  delivered by such entity and  constitute  the legal,
valid and binding  obligations  of Buyer,  enforceable  against it in accordance
with their terms, subject to the Creditors' Rights.

         6.3 Absence of  Conflicts.  Neither the execution and delivery by Buyer
of this Agreement or the other Transaction Documents to which it is a party, nor
the  consummation of the transactions  contemplated  hereby and thereby will (a)
violate or breach the terms of, cause a default under,  conflict with, result in
the  acceleration  of, create in any party the right to  accelerate,  terminate,
modify or cancel, require any notice or consent or give rise to any preferential
purchase or similar right under (i) any applicable  Legal  Requirement,  or (ii)
any  material  Contract  to which Buyer is a party or by which it, or any of its
properties,  is bound;  (b) result in the  creation  or  imposition  of any Lien
(other than a Permitted Lien) on any of Buyer's assets or properties; (c) result
in the cancellation,  forfeiture, revocation, suspension or adverse modification
of any existing consent, approval,  authorization,  license, permit, certificate
or order of any Governmental  Authority;  or (d) with the passage of time or the
giving of notice or the taking of any action of any third  party have any of the
effects set forth in clause (a), (b) or (c) of this Section 6.3.

         6.4 SEC Documents;  Buyer Financial Statements.  Buyer has furnished or
made  available  to the Company true and  complete  copies of all SEC  Documents
filed by it with the SEC since January 1, 2005, all in the form so filed.  As of
their  respective  filing dates,  such SEC Documents  filed by Buyer and all SEC
Documents  filed after the date  hereof but before the Closing  complied or will
comply in all material  respects with the requirements of the Securities Act and
the Exchange Act and the rules and  regulations  of the SEC  thereunder,  as the
case may be, and none of the SEC Documents  contained or will contain any untrue
statement of a material  fact or omitted to state a material fact required to be
stated therein or necessary to make the statements made therein, in light of the
circumstances in which they were made, not misleading, except to the extent such
SEC  Documents  have  been  corrected,  updated  or  superseded  by  a  document
subsequently  filed with the SEC. The financial  statements of Buyer,  including
the  notes  thereto,  included  in  the  SEC  Documents  (the  "Buyer  Financial
Statements") comply as to form in all material respects with the published rules
and  regulations  of the  SEC  with  respect  thereto,  have  been  prepared  in
accordance  with GAAP  consistently  applied  (except as may be indicated in the
notes thereto or, in the case of unaudited statements, as permitted by Form 10-Q
under the Exchange Act) and present fairly the consolidated  financial  position
of Buyer at the dates thereof and the consolidated results of its operations and
cash  flows  for the  periods  then  ended  (subject,  in the case of  unaudited
financial statements, to normal year-end adjustments).  There has been no change
in Buyer's  accounting  policies  except as  described in the notes to the Buyer
Financial  Statements.  Except as  reflected  or  reserved  against in the Buyer
Financial Statements, Buyer has no material Liabilities,  except for Liabilities
and  obligations  (i) incurred in the ordinary course of business since the date
of the most recent Buyer Financial Statements or (ii) that would not be required
to be reflected or reserved  against in the balance  sheet of Buyer  prepared in
accordance with GAAP.

         6.5  Capitalization.  The authorized capital stock of Buyer consists of
300,000,000  shares of Common  Stock,  $0.001  par  value  per  share,  of which
136,368,543  shares of Common Stock, were issued and outstanding as of the close
of  business  on June 1,  2006.  The shares of Buyer  Common  Stock to be issued
pursuant to the Share Exchange will be duly  authorized,  validly issued,  fully
paid, and non-assessable.

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         6.6 Brokers' Fees. Buyer has no liability or obligation to pay any fees
or commissions to any broker,  finder, or agent with respect to the transactions
contemplated  by this  Agreement  for  which  the  Sellers  or their  respective
Affiliates could become liable or obligated.

         6.7 Information. All information relating to the Buyer contained in the
memorandum from Parent Company to its shareholders dated 23 May 2006 was at such
date and will be at Closing true, complete,  accurate and not misleading.  Buyer
has fully disclosed to emw law LLP, counsel to the Major Shareholders, any fact,
matter or occurrence  that is or could  reasonably be expected to be material in
the context of Buyers or its Affiliates current financial  position,  subject to
an obligation to maintain confidentiality over material,  non-public information
pertaining to the Buyer.

                                   ARTICLE VII
                                    COVENANTS

         7.1 Releases and  Termination.  Save in respect of obligations  created
under this  Agreement  and for any rights under any  employment  or  consultancy
agreement each EUE Shareholder  severally  hereby releases and discharges  Buyer
and its  Affiliates  (including  each EUE Company  after the  Closing) and their
respective  successors,  heirs  and  assigns,  officers,  directors,  employees,
consultants,  representatives and agents from any and all obligations (including
indemnification obligations) and Claims, known and unknown, that have accrued or
may accrue  and that  relate to acts or  omissions  prior to the  Closing  Date,
including any and all Damages, whether such obligations, Claims or Damages arise
in tort, contract or statute,  including without limitation obligations,  Claims
or Damages (a) arising under EUE Organizational Documents or any Contract of any
of the EUE  Companies  and (b)  relating  to  actions or  omissions  of such EUE
Company,  or any acts or omissions of the  directors,  shareholders  or officers
(former or present) including those committed while serving in their capacity as
shareholders,  directors,  officers, employees or similar capacities of such EUE
Company, and including in each case any and all Claims which the EUE Shareholder
does  not know or  suspect  to  exist  in his,  her or its  favor as of the date
hereof.  Each EUE Shareholder  hereby waives any preemptive rights that he or it
may have,  or ever had,  with  respect to any  Interest  in any EUE  Company and
waives any right he or it may have  under the EUE  Organizational  Documents  or
otherwise to acquire any Interest in any EUE Company being transferred  pursuant
to, or as contemplated by, this Agreement or any transfer that occurred prior to
the date hereof. THE RELEASES CONTAINED IN THIS SECTION 7.1 APPLY TO ALL CLAIMS,
AND EACH EUE  SHAREHOLDER  AGREES TO WAIVE THE  BENEFITS  OF ANY LAW  (INCLUDING
PRINCIPLES  OF COMMON LAW) OF ANY  JURISDICTION  OF THE UNITED  STATES OR OF ANY
JURISDICTION  OUTSIDE OF THE UNITED STATES THAT PROVIDES THAT A GENERAL  RELEASE
DOES NOT EXTEND TO CLAIMS WHICH THE  CLAIMANT  DOES NOT KNOW OR SUSPECT TO EXIST
IN HIS FAVOR AT THE TIME OF EXECUTING  THE  RELEASE,  WHICH IF KNOWN BY HIM MUST
HAVE  MATERIALLY  AFFECTED HIS  SETTLEMENT.  IN PARTICULAR  EACH EUE SHAREHOLDER
HEREBY EXPRESSLY,  VOLUNTARILY AND KNOWINGLY  WAIVES,  RELINQUISHES AND ABANDONS
EACH AND EVERY RIGHT, PROTECTION AND BENEFIT TO WHICH THEY WOULD BE ENTITLED NOW
OR AT ANY TIME HEREAFTER UNDER SECTION 1542 OF THE CALIFORNIA  CIVIL CODE, which
provides:

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

In making this voluntary  express  waiver of the protection of California  Civil
Code  Section  1542  (or  its  equivalent  in  other  jurisdictions),   the  EUE
Shareholders  acknowledge  that they are aware that they may discover  claims or
facts in  addition  to or  different  from those  which are known or believed to
exist with respect to the matters mentioned herein. The EUE Shareholders  hereby
fully and  forever  settle  and  release  any and all such  matters,  claims and
disputes,  whether  known or unknown,  suspect or  unsuspected,  anticipated  or
unanticipated.

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         7.2 Non-Competition.

                  (a) (i) Each Major  Shareholder and, its officers,  directors,
partners, controlling shareholders (if any) or any other Affiliate of such Major
Shareholder   (each   a   "Non-Competition   Party"   and   collectively,    the
"Non-Competition  Parties"),  in  order to  induce  Buyer  to  enter  into  this
Agreement,  expressly  covenants  and agrees on a several  basis that during the
Prohibited  Period (as defined below),  (A) the  Non-Competition  Party will not
engage  directly or  indirectly in any business in which the Business is engaged
at Closing (a "Competing  Business") in the world (the "Restricted  Area"),  (B)
the  Non-Competition  Party  will not,  and will  cause its  Affiliates  not to,
directly  or  indirectly,  own,  manage,  operate,  join,  become an employee or
consultant of,  control or participate in or be connected  with, , any business,
individual,  partnership,  firm, corporation or other entity, which engages in a
Competing Business in the Restricted Area and (C) the Non-Competition Party will
not, and will cause its Affiliates  not to, sell or market,  directly or through
distributors,  brokers  or  other  intermediaries,  any  EUE  Products  and  the
Non-Competition  Party  will not join,  become an  employee  or  consultant  of,
control or  participate  in or be  connected  with,  or loan money to or sell or
lease equipment to, any Person which sells any EUE Products, in each case in the
Restricted Area in which EUE sells or markets, directly or through distributors,
brokers or other  intermediaries,  any EUE Products as of the Closing  Date.  As
used in this Section  7.2(a),  "Business"  shall refer to the products  sold and
services provided by any EUE Company in the operation of the Business during the
12-month period preceding the Closing Date. "Prohibited Period" shall mean three
years from and after the Closing Date.  "EUE  Products"  shall mean the products
provided  by the EUE  Companies  in the  operation  of the  Business  during the
12-month  period  preceding  the  Closing  Date,  or  other  products  that  are
functionally equivalent.

                           (ii) Notwithstanding  the  restrictions  contained in
Section 7.2(a)(i), a Non-Competition Party may own an aggregate of not more than
3% of the  outstanding  stock  of any  class  of any  corporation  engaged  in a
Competing Business, if such stock is listed on a national securities exchange or
regularly  traded  in the  over-the-counter  market  by a member  of a  national
securities  exchange,  without  violating the  provisions of Section  7.2(a)(i),
provided  that neither the  Non-Competition  Party nor its  Affiliates  have the
power, directly or indirectly, to control or direct the management or affairs of
any such corporation and are not involved in the management of such corporation.

                           (iii)  Each of the  Non-Competition  Parties  further
expressly   covenants  and  agrees  that  during  the  Prohibited   Period,  the
Non-Competition Parties will not, and the Non-Competition Parties will cause its
Affiliates not to (1) engage or employ, or solicit or contact with a view to the
engagement or employment of any person who is an officer,  employee,  consultant
or advisor of Buyer and its controlled  Affiliates  (including the EUE Companies
after the Closing) or (2) canvass,  solicit, approach or entice away or cause to
be  canvassed,  solicited,  approached  or  enticed  away  from  Buyer  and  its
controlled Affiliates (including the EUE Companies after the Closing) any person
who or which is a customer, distributor, or supplier of Buyer and its controlled
Affiliates  (including  the EUE  Companies  after the Closing) or (3) call on or
solicit any of Buyer's customers, distributors or suppliers, or their controlled
Affiliates for the purpose of providing  that Person any of Buyer's  proprietary
information  or any other  confidential  information  that  relates  to  Buyer's
business or services.

                           (iv) To the  extent  that  any  part of this  Section
7.2(a) may be invalid,  illegal or unenforceable  for any reason, it is intended
that such part  shall be  enforceable  to the extent  that a court of  competent
jurisdiction  shall  determine  that such part, if more limited in scope,  would
have been enforceable, and such part shall be deemed to have been so written and
the remaining parts shall as written be effective and enforceable in all events.

                  (b)  The   Non-Competition   Parties   and  Buyer   agree  and
acknowledge  that the  limitations  as to time,  geographical  area and scope of
activity to be restrained as set forth in Section  7.2(a) are  reasonable and do
not impose any greater  restraint  than is necessary  to protect the  legitimate
business interests of Buyer. The Non-Competition Parties and Buyer further agree
and  acknowledge  that, in the event of a breach or threatened  breach of any of
the  provisions  of this  Section  7.2,  Buyer shall be  entitled  to  immediate
injunctive  relief, as any such breach would cause Buyer irreparable  injury for
which it would have no adequate remedy at law. Nothing herein shall be construed
so as to  prohibit  Buyer  from  pursuing  any other  remedies  available  to it
hereunder, at law or in equity for any such breach or threatened breach.

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<PAGE>
                  (c) The Non-Competition Parties hereby represent to Buyer that
they have  read and  understand,  and  agree to be bound  by,  the terms of this
Section 7.2. The  Non-Competition  Parties acknowledge that the geographic scope
and  duration of the  covenants  contained in this Section 7.2 are the result of
arm's-length  bargaining  and are fair and reasonable in light of (i) the nature
and worldwide  potential scope of the operations of the EUE Companies,  (ii) the
fact that the  Business  is  conducted  throughout  the  geographic  area  where
competition  is  restricted  by  this   Agreement,   and  (iii)  the  amount  of
consideration that the Non-Competition Parties or their Affiliates are receiving
in connection with the  transactions  contemplated by this Agreement.  It is the
desire  and intent of the  parties  that the  provisions  of this  Agreement  be
enforced to the fullest extent permitted under  applicable  Legal  Requirements,
whether now or hereafter  in effect and  therefore,  to the extent  permitted by
applicable  Legal  Requirements,  the  parties  hereto  waive any  provision  of
applicable  Legal  Requirements  that would render any provision of this Section
7.2 invalid or unenforceable.

         7.3 Use of Name.  Except in the normal course of employment  with Buyer
or one of its subsidiaries,  from and after the Closing Date, no EUE Shareholder
nor any of their  Affiliates  will directly or indirectly  use in any manner any
trade name, trademark,  service mark or logo used by any of the EUE Companies or
any word or logo that is similar in sound or appearance.

         7.4 Further  Assurances.  Each party hereto will, at the request of any
other party hereto,  take such further  actions as are requested and execute any
additional  documents,  instruments  or  conveyances  of any kind  which  may be
reasonably  necessary to further effect the  transactions  contemplated  by this
Agreement.

         7.5 Confidentiality.  Each EUE Shareholder  severally agrees that for a
period of five years after the  Closing  Date and any facts,  information,  know
how,  processes,  trade  secrets,  customer lists or  confidential  matters that
relate in any way to the  Business  or an EUE  Company  shall be  maintained  in
confidence  and  shall  not be  divulged  by the EUE  Shareholder  or any of its
Affiliates  to any party  unless and until they shall  become  public  knowledge
(other  than by  disclosure  in breach of this  Section  7.5) or as  required by
applicable Legal Requirements;  provided however,  before any EUE Shareholder or
any of its  Affiliates  discloses  any of the  foregoing  as may be  required by
applicable  Legal  Requirements,  such Person  shall,  if  possible,  give Buyer
reasonable  advance notice and take such reasonable actions as Buyer may propose
to minimize the required disclosure.

         7.6 Books and Records.  The Major  Shareholders  acknowledge  and agree
that from and after the Closing  Buyer will be entitled to the  originals of all
Books and  Records  that are in the Major  Shareholders'  possession.  The Major
Shareholders  will  promptly  deliver to Buyer such  originals  or copies of all
Books and Records. Buyer shall cooperate in all reasonable respects with Sellers
and will make available to the Sellers,  during normal business hours, the Books
and Records which relate to the period  preceding the Closing Date and which are
necessary or useful in connection  with any  third-party  tax inquiry,  audit or
similar  investigation  or any dispute or litigation;  provided,  however,  that
prior to  receiving  access to any of the Books and Records,  the Sellers  shall
enter into a customary  confidentiality  agreement binding on them and any other
Person to whom the information may be disclosed; and provided further,  however,
that Buyer shall be entitled to destroy Books and Records in  accordance  with a
customary document retention policy.

         7.7 Publicity.  Except as required by a court of competent jurisdiction
or applicable  Legal  Requirements,  including  applicable  securities  laws and
regulations,  and except for  disclosures  required to be made in the  financial
statements of Buyer or any of its Affiliates or in offering  documents,  none of
the parties hereto nor any of their  respective  Affiliates  shall,  without the
prior consent of the other parties (which shall not be  unreasonably  withheld),
make any statement or any public  announcement  or press release with respect to
the transactions contemplated by this Agreement.

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         7.8 Intentionally Deleted.

         7.9 Access and  Investigation.  Subject to the terms of this  Agreement
regarding  confidentiality,  during  the period  commencing  on the date of this
Agreement  and  ending at the  Closing  (the  "Interim  Period")  or until  this
Agreement is terminated  pursuant to Section 11, upon  reasonable  notice to the
Major Shareholders representative, Michael Porter, the Major Shareholders shall,
and shall cause such Sellers'  Representatives to: (a) provide Buyer and Buyer's
Representatives  with  reasonable  access during normal  business  hours to such
Buyer's  Representatives,  personnel  and  assets  and  to all  existing  books,
records,  Tax Returns,  work papers and other documents and information relating
to the EUE Companies that Buyer may reasonably  request in connection  with this
Agreement  and the  consummation  of the  Transactions;  (b)  provide  Buyer and
Buyer's  Representatives  with such copies of the existing books,  records,  Tax
Returns, work papers, product data, and other documents and information relating
to the EUE Companies,  and with such additional  financial,  operating and other
data and information regarding the EUE Companies as Buyer may reasonably request
in connection with this Agreement and the consummation of the Transactions;  and
(c) permit Buyer's officers and other employees to meet, upon reasonable  notice
and during normal  business hours,  with the chief  financial  officer and other
officers and managers of the EUE Companies  responsible for the Parent Company's
consolidated financial statements and the internal controls of Parent Company to
discuss such matters as Buyer may  reasonably  deem  necessary or appropriate in
order to enable Buyer to satisfy its obligations  under the  Sarbanes-Oxley  Act
and the rules and regulations relating thereto.  Without limiting the generality
of any of the  foregoing,  during the Interim  Period or until this Agreement is
terminated  pursuant to Section 11,  Major  Shareholders  shall cause the Parent
Company to promptly provide Buyer with copies of:

                  (a) the unaudited monthly  consolidated balance sheets of each
EUE  Company  as of the end of each  calendar  month and the  related  unaudited
monthly  consolidated  statements of  operations,  statements  of  stockholders'
equity and  statements  of cash flows for such  calendar  month,  which shall be
delivered within fifteen days after the end of such calendar month;

                  (b) all material  operating and financial  reports prepared by
each EUE Company for its senior management;

                  (c) any  written  materials  or  communications  sent by or on
behalf of any EUE Company to its stockholders;

                  (d) any material notice,  document or other communication sent
by any EUE Company that is a party to any Material Contract,  or sent to any EUE
Company by any party to any Material Contract (other than any communication that
relates  solely to routine  commercial  transactions  between such Party and the
other party to any such Material  Contract,  and that is of the type sent in the
ordinary course of business and consistent with past practices);

                  (e)  any  notice,  report  or  other  document  filed  with or
otherwise furnished,  submitted or sent to any Governmental  Authority on behalf
of a Party in connection with the Transactions;

                  (f) any non-privileged notice, document or other communication
sent by or on behalf of, or sent to, an EUE  Company  relating to any pending or
threatened Legal Proceeding involving or affecting such Party; and

                  (g) any material notice,  report or other document received by
a Party from any Governmental Authority.

         7.10 Operation of EUE and Buyer Business.

                  (a) During the  Interim  Period the Major  Shareholders  shall
cause:  (i) each EUE Company to conduct its business and operations:  (A) in the
ordinary course of business and in accordance  with past practices,  (other than
taking such actions as may be necessary  or  advisable  in  connection  with the
consummation  of the  Transactions);  and (B) in compliance  with all applicable
Legal Requirements and the requirements of all Material Contracts; (ii) each EUE
Company to use  commercially  reasonable  efforts to preserve intact its current
business  organization,  keep  available  the  services  of its  current  senior
managers and other  employees  and maintain its  relations and goodwill with all
suppliers,  customers, landlords, creditors, licensors, licensees, employees and
other Persons having business relationships with any EUE Company; and (iii) each
EUE  Company  to  notify  the  Buyer  promptly  of:  (A)  any  notice  or  other
communication from any Person alleging that the Consent of such Person is or may
be  required  in  connection  with any of the  Transactions;  and (B) any  Legal
Proceeding  against,  relating  to,  involving or  otherwise  affecting  any EUE
Company  that  is  commenced,  or,  to  the  Knowledge  of  Major  Shareholders,
threatened against, any EUE Company.

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<PAGE>

                  (b)  Except  as  set  forth  in  Schedule  7.10  or as  may be
necessary or advisable in connection with the consummation of the  Transactions,
during the Interim Period, the Major Shareholders shall not (with respect to the
business or  operations of the Parent  Company),  and Major  Shareholders  shall
cause each EUE Company not to, without the prior written consent of Buyer:

                           (i) declare, accrue, set aside or pay any dividend or
                  make any  other  distribution  in  respect  of any  shares  of
                  capital  stock or other  security,  or  repurchase,  redeem or
                  otherwise  reacquire  any share  capital,  interests  or other
                  securities;

                           (ii)  sell,  issue,  grant  or  authorize  the  sale,
                  issuance or grant of: (A) any share capital or other security;
                  (B) any  option,  call,  warrant or right to acquire any share
                  capital or other security;  or (C) any instrument  convertible
                  into or exchangeable for any share capital or other security;

                           (iii)  amend or waive  any of its  rights  under,  or
                  permitted the  acceleration of vesting under any provision of:
                  (A) any restricted stock purchase agreement;  or (B) any other
                  Contract  evidencing or relating to any equity award  (whether
                  payable in cash or stock);

                           (iv) amend or permit the adoption of any amendment to
                  its certificate of incorporation or memorandum and articles of
                  association,  or  effect  or  become  a party  to any  merger,
                  consolidation,    share   exchange,    business   combination,
                  amalgamation,  recapitalization,  reclassification  of shares,
                  stock split,  reverse stock split,  division or subdivision of
                  shares,  consolidation  of shares or  similar  transaction  or
                  otherwise  acquire  or agree to acquire  any  assets  that are
                  material, individually or in the aggregate, to the business of
                  EUE (save in the ordinary course of business);

                           (v)  form  any   Subsidiary  or  acquire  any  equity
                  interest or other  interest in any other  Person or enter into
                  any  material  partnership  arrangements,   joint  development
                  agreements or strategic alliances;

                           (vi) make any material capital expenditure;

                           (vii)  acquire,  lease or license  any right or other
                  asset from any other Person or sell encumber,  convey, assign,
                  or otherwise dispose of or transfer of, or lease or license or
                  sublicense,  any right or other asset or  interest  therein to
                  any other Person (except in each case for assets (that are not
                  material  individually or in the aggregate) acquired,  leased,
                  licensed  or  disposed  of by EUE in the  ordinary  course  of
                  business  and  consistent  with past  practices),  or waive or
                  relinquish any material right;

                           (viii) other than in the ordinary  course of business
                  consistent with past practice, write-off as uncollectible,  or
                  establish  any  extraordinary  reserve  with  respect  to  any
                  material receivable or other indebtedness;

                           (ix) make any  pledge of any of its  assets or permit
                  any of its  assets  to  become  subject  to any  Encumbrances,
                  except  for  pledges  of  or  Encumbrances   with  respect  to
                  immaterial  assets  made in the  ordinary  course of  business
                  consistent with past practices;

                           (x) lend money to any Person,  or incur or  guarantee
                  any  indebtedness  or issue or sell  any  debt  securities  or
                  options,  warrants,  calls or other rights to acquire any debt
                  securities of EUE;

                           (xi) other than in the  ordinary  course of  business
                  consistent with past practices,  establish,  adopt, enter into
                  or amend any stock option or bonus plan, pay any bonus or make
                  any  profit-sharing  or similar  payment to, or  increase  the
                  amount of the wages, salary,  commissions,  fringe benefits or
                  other  compensation  (including   equity-based   compensation,
                  whether   payable  in  stock,   cash  or  other  property)  or
                  remuneration  payable  to any of its  directors  or any of its
                  officers or other employees except as required by law;

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Share Exchange Agreement - CTC & Shareholders of EU Energy plc           Page 28
<PAGE>
                           (xii) make any grant of exclusive rights to any third
                  party;

                           (xiii)  make any  material  Tax  election or adopt or
                  change any accounting methods, principles or practices;

                           (xiv)   commence   or  settle  any   material   Legal
                  Proceeding;

                           (xv) enter into any material  transaction or take any
                  other material  action outside the ordinary course of business
                  or inconsistent with past practices;

                           (xvi) commence or settle any Legal Proceeding,  other
                  than in the ordinary  course of business  consistent with past
                  practices;

                           (xvii)  agree or  commit  to take any of the  actions
                  described  in clauses  "(i)"  through  "(xvi)" of this Section
                  7.10(b).

                  (c) During the Interim Period,  the Major  Shareholders  shall
cause  Parent  Company to promptly  notify  Buyer in writing,  by delivery of an
updated  Disclosure  Schedule,  of: (i) the  discovery by any EUE Company of any
event,  condition,  fact or circumstance that occurred or existed on or prior to
the date of this Agreement and that caused or constitutes a material  inaccuracy
in any  representation  or  warranty  made  regarding  any EUE  Company  in this
Agreement  or an  inaccuracy  or  warranty  regarding  any EUE  Company  in this
Agreement that would have a Material Adverse Effect; (ii) any event,  condition,
fact or  circumstance  that  occurs,  arises  or  exists  after the date of this
Agreement  and that  would  cause or  constitute  a material  inaccuracy  in any
representation  or  warranty  made  with  respect  to any  EUE  Company  in this
Agreement if: (A) such  representation  or warranty had been made as of the time
of the  occurrence,  existence or discovery  of such event,  condition,  fact or
circumstance;  or (B) such event, condition,  fact or circumstance had occurred,
arisen or existed on or prior to the date of this Agreement;  (iii) any material
breach of any  covenant or  obligation  of Parent  Company;  and (iv) any event,
condition,  fact or circumstance  that could  reasonably be expected to make the
timely  satisfaction  of  any  of the  conditions  set  forth  in  Sections  8.2
impossible or materially less likely or that has resulted in or would reasonably
be expected to result in an EUE Material  Adverse Effect.  Without  limiting the
generality of the foregoing,  Seller shall  promptly  advise Buyer in writing of
any Legal Proceeding or claim threatened,  commenced or asserted against or with
respect to, or  otherwise  affecting,  any EUE Company or, to the  Knowledge  of
Major  Shareholders,  any director or officer of a EUE Company.  No notification
given to Buyer pursuant to this Section 7.10(c) shall limit or otherwise  affect
any of the  representations,  warranties,  covenants or obligations of Seller or
EUE contained in this Agreement.

                  (d) During the  Pre-Closing  Period,  the Seller will not, and
will not agree or commit to, sell,  transfer,  dispose of or otherwise  Encumber
any of the EUE Shares.

                  (e) During the  Interim  Period  Buyer will not dispose of any
material part of its business and/or assets without the prior written consent of
Porter.

         7.11 No  Solicitation.  Each Major  Shareholder  severally  agrees that
neither  it nor  any of its  Subsidiaries  shall,  nor  shall  it nor any of its
Subsidiaries  authorize  or permit any of the  officers,  directors,  investment
bankers,  attorneys or accountants retained by it or any of its Subsidiaries to,
and that it shall  use  commercially  reasonable  efforts  to cause  its and its
Subsidiaries'  non-officer  employees  and other  agents  not to (and  shall not
authorize  any of them  to)  directly  or  indirectly:  (i)  solicit,  initiate,
encourage, induce or knowingly facilitate the communication,  making, submission
or announcement of any Acquisition  Proposal or Acquisition  Inquiry or take any
action that could  reasonably be expected to lead to an Acquisition  Proposal or
Acquisition Inquiry;  (ii) furnish any information  regarding any EUE Company to
any Person in  connection  with or in  response  to an  Acquisition  Proposal or
Acquisition Inquiry; (iii) engage in discussions or negotiations with any Person
with respect to any Acquisition Proposal or Acquisition  Inquiry;  (iv) approve,
endorse or recommend any Acquisition  Proposal; or (v) execute or enter into any
letter of intent or similar document or any Contract  contemplating or otherwise
relating to any Acquisition Transaction.

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<PAGE>
         7.12 Registration Rights. The Buyer shall:

                  (a) as soon as practicable after the Closing,  but in no event
later than the ninetieth (90th) day following the Closing, prepare and file with
the SEC a  registration  statement  under the Securities Act on Form S-3 (or, if
the  Company  is  ineligible  to use Form  S-3,  then on Form  SB-2 or S-1) (the
"Registration  Statement")  relating to the sale of the Buyer  Shares by the EUE
Shareholders from time to time on the OTC Bulletin Board;

                  (b) subject to receipt of necessary  information  from the EUE
Shareholders,  use its best efforts to cause the SEC to declare the Registration
Statement effective as soon as possible after its filing;

                  (c) notify emw Law LLP whose  address  appears in Section 10.2
promptly  upon the  Registration  Statement,  and any  post-effective  amendment
thereto, being declared effective by the SEC;

                  (d)  prepare  and  file  with  the  SEC  such  amendments  and
supplements to the Registration  Statement and the prospectus  contained therein
and take such other action, if any, as may be necessary to keep the Registration
Statement  effective  until the  earlier  of (i) the second  anniversary  of the
Closing  Date or (ii) all of the Buyer  Shares  have been sold  pursuant  to the
Registration Statement or Rule 144 under the Securities Act or any other rule of
similar effect;

                  (e)  during  the  period  when  copies of the  prospectus  are
required to be delivered under the Securities Act or the Securities Exchange Act
of 1934 (the "Exchange Act"),  file all documents  required to be filed with the
SEC pursuant to Section 13, 14 or 15 of the Exchange Act within the time periods
required  by  the  Exchange  Act  and  the  rules  and  regulations  promulgated
thereunder;

                  (f) bear all expenses for the  procedures  in  paragraphs  (a)
through (g) of this Section 7.12 in connection  with  registration  of the Buyer
Shares.

                  (g) Each of the Parties  shall  ensure  that the  Registration
Statement (so far as it relates to information  about the Party) will not at the
time it becomes effective under the Securities Act, contain any untrue statement
of a material  fact or omit to state any  material  fact  required  to be stated
therein or necessary in order to make the statements therein not misleading.

         Each Party shall  promptly  furnish to the other Party all  information
concerning   such  Party  and  such  Party's   subsidiaries   and  such  Party's
stockholders that may be required or reasonably requested in connection with any
action contemplated by this Section 7.12.

         7.13 Parent Company Stockholders' Meeting.

                  (a)  Subject to Section  8.2 Major  Shareholders  shall  cause
Parent  Company to hold an  extraordinary  general  meeting or  meetings  of the
holders of Seller's outstanding share capital (the "Parent Company Stockholders'
Meeting").  Sellers agree that such notice shall include  resolution that Parent
Company  be  re-registered  as a private  limited  company,  (collectively,  the
"Resolution").  The Parent Company  Stockholders'  Meeting shall be held on June
15, 2006.  In the event that holders of at least 95% of the  outstanding  Parent
Company Common Stock do not approve the Resolution,  at Buyer's written request,
each Major  Shareholder  shall take all actions  necessary to cause  shareholder
approval of this transaction,  including without limitation,  assisting Buyer in
preparing an Offer Letter to acquire EUE Shares that complies with the City Code
on Takeovers and Mergers.

         7.14 Regulatory Approvals. Each Party shall use commercially reasonable
efforts to file or otherwise  submit,  as soon as practicable  after the date of
this  Agreement,   all  applications,   notices,  reports  and  other  documents
reasonably  required to be filed by such Party with or  otherwise  submitted  by
such Party to any Governmental  Authority with respect to the Transactions,  and
to submit promptly any additional information requested by any such Governmental
Authority.

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Share Exchange Agreement - CTC & Shareholders of EU Energy plc           Page 30
<PAGE>
         7.15 Additional Agreements.

                    (a)  Subject  to  Section  7.15(b),  the  Parties  shall use
commercially  reasonable  efforts to cause to be taken all actions  necessary to
consummate  and make  effective  the  Transactions  and to vest  Buyer with full
right, title,  interest and possession of and to all of the EUE Shares.  Without
limiting the generality of the foregoing,  but subject to Section 7.15(b),  each
Party to this  Agreement:  (i) shall make all filings and other  submissions (if
any) and give all notices  (if any)  required to be made and given by such Party
in  connection  with the  Transaction;  (ii) shall use  commercially  reasonable
efforts to obtain  each  Consent  (if any)  reasonably  required  to be obtained
(pursuant to any applicable Legal Requirement or Contract, or otherwise) by such
Party in connection with the Transactions or for such Contract to remain in full
force and effect;  (iii) shall use commercially  reasonable  efforts to lift any
injunction  prohibiting,  or any other legal bar to, the Transactions;  and (iv)
shall  use  all  commercially  reasonable  efforts  to  satisfy  the  conditions
precedent to the consummation of the  Transactions.  Each Party shall provide to
the other Party a copy of each proposed  filing with or other  submission to any
Governmental  Authority  relating to the Transactions,  and shall give the other
Party a reasonable time prior to making such filing or other submission in which
to review and comment on such proposed  filing or other  submission.  Each Party
shall  promptly  deliver to the other  Party a copy of each such filing or other
submission  made,  each  notice  given and each  Consent  obtained by such Party
during the Interim Period.

                     (b)  Notwithstanding  anything to the contrary contained in
this Agreement, no Party shall have any obligation under this Agreement:  (i) to
dispose  of or  transfer  or cause  any of its  Subsidiaries  to  dispose  of or
transfer any assets;  (ii) to  discontinue or cause any of its  Subsidiaries  to
discontinue offering any product or service;  (iii) to license or otherwise make
available,  or cause  any of its  Subsidiaries  to  license  or  otherwise  make
available  to any Person any  intellectual  property;  (iv) to hold  separate or
cause any of its Subsidiaries to hold separate any assets or operations  (either
before or after the Closing Date);  (v) to make or cause any of its Subsidiaries
to make any commitment (to any  Governmental  Authority or otherwise)  regarding
its future  operations;  or (vi) to contest any Legal  Proceeding  or any order,
writ, injunction or decree relating to the Transactions if such Party determines
in good faith that contesting such Legal Proceeding or order,  writ,  injunction
or decree could materially adversely affect such Party.

         7.16  Disclosure.  Without  limiting any of either Party's  obligations
under the Letter of Intent dated  February  28, 2006,  each Party shall not, and
shall not permit any of its Subsidiaries or any Representative of such Party to,
issue any press release or make any disclosure (to any customers or employees of
such Party, to the public or otherwise)  regarding the Transactions  unless: (a)
the other Party shall have approved such press release or disclosure in writing;
or (b) such Party shall have determined in good faith,  after  consultation with
outside legal  counsel,  that such  disclosure  is required by applicable  Legal
Requirements and before such press release or disclosure is issued or made, such
Party advises the other Party of, and consults  with the other Party  regarding,
the text of such press release or disclosure.

         7.17 EU Energy Principals' Agreements. Porter and Bircher shall execute
and deliver to Buyer, prior to the Closing,  an EU Energy Principals'  Agreement
in the form of Exhibit B. Buyer shall not register,  or allow its transfer agent
to register,  on its books any transfer of any shares of its share capital owned
by any  "affiliate"  of Parent  Company who has not  provided a signed EU Energy
Principals' Agreement in accordance with this Section 7.17.

         7.18 Officers and Directors. The board of directors of Buyer shall take
all actions necessary at or immediately following the Closing to appoint Michael
Porter  as an  officer  of the  Buyer  with the  title of  President  and as the
President of Parent Company.  Michael Porter shall take all actions necessary to
ensure that he shall  comply with the filing and other  obligations  required by
his appointment as an officer of the Buyer.

         7.19  10%  Ownership;   U.S.   Securities  Law  compliance.   Each  EUE
Shareholder  shall  notify  Buyer if he, she or it  acquires  10% or more of the
outstanding  shares  of Buyer  common  stock,  including  options,  warrants  or
convertible  debentures  exercisable or convertible  into shares of Buyer common
stock.  Such EUE Shareholder shall make all required filings under Section 16 of
the Securities  Exchange Act of 1934, as amended,  including without limitation,
all Form 3s, Form 4s and Form 5s (or any equivalent forms) required  thereunder.
Each EUE  Shareholder  holding 5% or more of the  outstanding  common stock on a
fully-diluted basis shall file a Schedule 13D or Schedule 13G (or any equivalent
forms) as required by applicable U.S. Securities laws.

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Share Exchange Agreement - CTC & Shareholders of EU Energy plc           Page 31
<PAGE>

                                  ARTICLE VIII
                              CONDITIONS TO CLOSING

         8.1 Mutual  Obligations.  The  obligations  of each Party to effect the
Transactions  are subject to the  satisfaction  or, to the extent  permitted  by
applicable  law, the written  waiver by each of the Parties,  at or prior to the
Closing, of each of the following conditions:

                  (a) No Restraints. No temporary restraining order, preliminary
or permanent injunction or other order preventing the consummation of any of the
Transactions  shall have been issued by any court of competent  jurisdiction  or
other  Governmental  Authority and remain in effect,  and there shall not be any
Legal  Requirement which has the effect of making the consummation of the any of
the Transactions illegal.

                  (b) No  Governmental  Proceedings  Relating to Transactions or
Right to Operate Business.  There shall not be any Legal Proceeding  pending, or
overtly  threatened  in writing by an official of a  Governmental  Authority  in
which such Governmental Authority indicates that it intends to conduct any Legal
Proceeding or taking any other action: (a) challenging or seeking to restrain or
prohibit the consummation of any of the Transactions;  (b) that would materially
and  adversely  affect the right or ability of Seller or Buyer to own the assets
or operate the business of Buyer or EUE; or (c) seeking to compel Seller, EUE or
Buyer to  dispose of or hold  separate  any  material  assets as a result of the
Transactions.

         8.2  Additional  Conditions  Precedent  to  Obligations  of Buyer.  The
obligations of Buyer to effect the  Transactions are subject to the satisfaction
or the  written  waiver by  Buyer,  at or prior to the  Closing,  of each of the
following conditions:

                  (a) Re-Registration as a Private Limited Company. Provision to
the Buyer or the Buyer's legal advisors of a certified  copy of the  certificate
of  re-registration  of a public company as a private  limited company under the
Companies Act 1985 as applicable to the Parent Company.

                  (b) Supermajority.  EUE Shareholders  holding more than 80% of
the Parent Company Shares shall have entered into this Share Exchange Agreement.

                  (c)  Accuracy  of  Representations.  Save  in  respect  of any
matters  having in aggregate a value of less than  $500,000 the  representations
and  warranties  of Sellers,  including  Major  Shareholders,  contained in this
Agreement  shall have been true and  correct on and as of June 14,  2006 and the
Closing  Date  with the same  force and  effect as if made on June 14,  2006 and
Closing Date, respectively,  except (a) in each case, or in the aggregate, where
the failure to be true and correct  would not  reasonably be expected to have an
EUE Material  Adverse Effect,  or (b) for those  representations  and warranties
which address matters only as of a particular date (which  representations shall
have been true and correct,  subject to the  qualifications  as set forth in the
preceding clause (a), as of such particular date) (it being understood that, for
purposes of determining the accuracy of such representations and warranties, all
"EUE Material Adverse Effect"  qualifications and other  qualifications based on
the word "material"  contained in such  representations  and warranties shall be
disregarded

                  (d)  Performance  of  Covenants.  All  of  the  covenants  and
obligations  in this  Agreement  that  Seller is  required  to comply with or to
perform at or prior to the Closing  shall have been  complied with and performed
by Seller in all material respects.

                  (e)  Agreements  and Other  Documents.  The Buyer  shall  have
received the following agreements and other documents, each of which shall be in
full force and effect:

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Share Exchange Agreement - CTC & Shareholders of EU Energy plc           Page 32
<PAGE>
                           (1) EU Energy  Principals'  Agreements in the form of
                  Exhibit B,  executed  by Steven  Bircher  and Porter of Parent
                  Company;

                           (2) a  certificate  executed  by the Chief  Executive
                  Officer of the Parent Company  confirming  that the conditions
                  set forth in Sections  8.2(c) and (d) have been duly satisfied
                  with  respect to Major  Shareholders  and to the best of their
                  knowledge by all other Sellers.

                           (3) to the extent  applicable,  certificates  of good
                  standing  of the  EUE  Companies  in  their  jurisdictions  of
                  organization  and the various foreign  jurisdictions  in which
                  they are qualified, certified charter documents;

                  (f) No EUE  Material  Adverse  Effect.  Since the date of this
Agreement,  there shall not have occurred any EUE Material  Adverse Effect,  and
since  the  date  of  this  Agreement  no  event  shall  have  occurred  and  no
circumstance  shall have come into existence that, in combination with any other
events  or  circumstances,  would  reasonably  be  expected  to result in an EUE
Material Adverse Effect.

                  (g) Cash Balances.  Immediately  prior to the Closing,  Parent
Company shall hold an amount of Cash equal to or greater than the amount of cash
shown on the Audited Financial  Statements,  less any purchases or payments made
in the  normal  course  of  business  since the date of such  Audited  Financial
Statements and less any other payments agreed in advance with the Buyer.

                  (h) Drag-Along Exercise. Except where EUE Shareholders holding
100%  of  the  Parent  Company  Shares  have  executed  this  Agreement,   Major
Shareholders  shall provide written evidence that a drag notice has been validly
served  prior to Closing on such of the EUE  Shareholders  who have not executed
this  Agreement in  accordance  with the  provisions of article 22 of the Parent
Company's articles of association.

                  (i) Due Diligence. The Buyer shall have been satisfied, by the
close of business on June 14, 2006 Pacific  Standard  Time,  with the results of
its  intellectual  property,  financial,   customer,  technical  and  legal  due
diligence, in its sole discretion.  Such diligence to include access with Parent
Company's external auditors and review of their paperwork.

                  (j) Fairness Opinion. The Buyer shall have received a fairness
opinion,  by the close of business on June 14, 2006, Pacific Standard Time, from
The Mentor Group or another  comparable  independent  appraiser stating that the
transaction is fair to Buyer shareholders from a financial point of view.

         8.3. Additional Conditions Precedent to Obligations of each Seller. The
obligations  of any  Seller  to  effect  the  Transactions  are  subject  to the
satisfaction  or the written  waiver by Seller,  at or prior to the Closing,  of
each of the following conditions:

                  (a)  Accuracy  of  Representations.  The  representations  and
warranties of Buyer contained in this Agreement shall be true and correct on and
as of June 14, 2006 and  Closing  Date with the same force and effect as if made
on June 14, 2006 and Closing Date, respectively,  except (a) in each case, or in
the aggregate,  where the failure to be true and correct would not reasonably be
expected  to  have  a  Buyer  Material   Adverse   Effect,   or  (b)  for  those
representations  and  warranties  which address  matters only as of a particular
date (which  representations  shall have been true and  correct,  subject to the
qualifications  as set forth in the preceding  clause (a), as of such particular
date) (it being  understood  that, for purposes of  determining  the accuracy of
such  representations  and  warranties,  all  "Buyer  Material  Adverse  Effect"
qualifications and other  qualifications  based on the word "material" contained
in such representations and warranties shall be disregarded.

                  (b)  Performance  of  Covenants.  All  of  the  covenants  and
obligations  in this  Agreement  that  Buyer is  required  to comply  with or to
perform at or prior to the Closing  shall have been  complied with and performed
in all material respects.

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                  (c) Documents. The representative of the Seller at the Closing
or if no representative  is present,  the Parent Company shall have received the
following documents:

                           (1) a  certificate  executed  by the Chief  Executive
                  Officer and Chief Financial  Officer of Buyer  confirming that
                  the conditions set forth in Section 8.3(a) and (b);

                           (2) to the extent  applicable,  certificates  of good
                  standing  of  Buyer  in  its   jurisdiction  of  organization,
                  certified charter documents, certificates as to the incumbency
                  of officers  and the adoption of  resolutions  of its board of
                  directors authorizing the execution of this Agreement.

                           (3) The Buyer shall have  transferred  to emw law LLP
                  the  Seller's  legal  costs not to exceed the amount  fixed in
                  Section 10.6.

                  (d)  Agreement  with Michael  Porter.  Michael  Porter and the
Buyer shall have  concluded a consultancy  agreement  substantially  in the form
attached hereto as Exhibit "D".

                  (e) Buyer  having  completed  due  diligence  and received the
report of the Mentor Group (as referred to in 8.2 (i) and (j)  respectively)  by
the due date or any subsequent date agreed upon by Buyer and Porter.

                                   ARTICLE IX
                                 INDEMNIFICATION

         9.1 Indemnities of the Major Shareholders.

                  (a) Major Shareholder Indemnified Liabilities.  Subject to the
provisions  of  this  Article  IX,  from  and  after  the  Closing,  each  Major
Shareholder shall, jointly and severally, indemnify defend and hold harmless the
Buyer, the Buyer's  Affiliates,  and their respective  directors,  stockholders,
officers,  partners,  successors,  transferees and assignees (collectively,  the
"Buyer  Indemnified  Parties")  from,  against  and in respect of any Damages or
Claims  that  arise  out of,  relate  to or  result  from  any of the  following
described  matters (herein  collectively  referred to as the "Major  Shareholder
Indemnified  Liabilities," and individually as a "Major Shareholder  Indemnified
Liability"):  (i) any breach of any  representation  or warranty in Article 5 of
this Agreement;  (ii) any breach by any Major  Shareholder or EUE Company of any
covenant or obligation of this Agreement; (iii) any breach of any representation
or  warranty  in  Article  4 of this  Agreement  as it  pertains  to such  Major
Shareholder only; and (iv) any pre-closing liability of any Major Shareholder or
EUE Company which shall include any  liabilities or  obligations  arising out of
the  operation of the business of the EUE  Companies  prior to the Closing other
than liabilities,  obligation or Claims specifically disclosed in the Disclosure
Schedules  attached to this Agreement or  liabilities or obligations  which have
arisen  in the  ordinary  course of  business  since  March 31,  2006 and do not
individually  or in the  aggregate  materially  and  adversely  impact  the  EUE
Companies.

                  (b) Time Limitations. Notwithstanding anything to the contrary
in this  Agreement,  in no event shall any of the Buyer  Indemnified  Parties be
permitted to make any Claim under Section 9.1(a) unless such Claim is first made
on or prior to the first  anniversary of the Closing;  provided,  however,  that
such one year  survival  period  shall not apply to (i) any Claim under  Section
9.1(a)(i)  relating to the breach of any representation or warranty contained in
Article IV or any  representation or warranty  regarding the title to the Parent
Company Shares (which Claim,  in any such case,  may be asserted  indefinitely),
(ii)  any  Claim  under  Section  9.1(a)(i)   relating  to  the  breach  of  any
representation  or warranty  contained in Section 5.18 (which Claim, in any such
case,  may be  asserted  on or before  the date  which is six  months  after all
indemnifiable  Taxes have  become  finally  binding and  non-appealable  and all
applicable  statutes of limitation periods have expired),  (iii) any Claim under
Section 9.1(a)(ii) that applies to a breach of Section 7.2  (Noncompetition)  or
Section 7.5 (Confidential  Information),  which Claim may be asserted within one
year after the applicable  breach of the covenant by the Major  Shareholder,  or
(iv) cases of fraud or willful concealment.

                  (c)  Additional  Limitation.  Notwithstanding  anything to the
contrary in this Agreement, the liability of the Sellers in respect of any Claim
shall be limited as follows:

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                           (1) the  aggregate  maximum  liability  of  each  EUE
                  Shareholder in respect of all and any Claims shall in no event
                  exceed the amount resulting from multiplying the number of the
                  Buyer Shares  delivered to the Seller under this  Agreement by
                  $1.55;

                           (2) a  Major  Shareholder  shall  not  be  liable  in
                  respect of all and any claims for a Claim unless and until the
                  aggregate  cumulative  liability of the Major  Shareholder  in
                  respect of all and any such claims  exceeds  $500,000 in which
                  event the Major  Shareholder  shall be liable  for all and any
                  Claims;

                           (3) the liability of the Major  Shareholders shall be
                  reduced to the extent that such Claim is  attributable  to any
                  voluntary act or transaction or arrangement carried out by the
                  Buyer after the date  hereof  otherwise  than in the  ordinary
                  course  of  business  that  has the  effect  of  retroactively
                  causing  a Major  Shareholder  to breach a  representation  or
                  warranty under Article 5 of this Agreement.

         9.2 Indemnities of Buyer.

                  (a) Buyer Indemnified  Liabilities.  Subject to the provisions
of this Article IX, from and after the Closing,  Buyer shall  indemnify,  defend
and hold harmless the Sellers, (collectively,  the "Seller Indemnified Parties")
from,  against and in respect of any Damages or Claims that arise out of, relate
to or result from any of the following  described  matters (herein  collectively
referred  to  as  the  "Buyer  Indemnified  Liabilities"):  (i)  breach  of  any
representation or warranty made by Buyer in this Agreement or (ii) any breach by
Buyer of any covenant or obligation of Buyer in this Agreement.

                  (b) Time Limitation.  Notwithstanding anything to the contrary
in this Agreement,  in no event shall any of the Seller  Indemnified  Parties be
permitted to make any Claim under Section 9.2 unless such Claim is first made on
or prior to the first anniversary of the Closing;  provided,  however, that such
one year survival  period shall not apply to any Claim under Section  9.2(a)(ii)
(which Claim may be asserted  within one year after the  applicable  breach of a
covenant by Buyer) nor shall it apply in cases of fraud or willful concealment.

                  (c)  Additional  Limitation.  Notwithstanding  anything to the
contrary in this Agreement,  the liability of the Buyer in respect of any Breach
shall be limited as follows:

                           (1) the aggregate  maximum  liability of the Buyer in
                  respect of all and any  Breaches  shall in no event exceed the
                  amount  resulting  from  multiplying  the  number of the Buyer
                  Shares delivered to the Sellers under this Agreement by $1.55;

                           (2) Buyer  shall not be liable in  respect of all and
                  any  claims  for a  Breach  unless  and  until  the  aggregate
                  cumulative  liability  of the Buyer in  respect of all and any
                  such claims exceeds $500,000 in which event the Buyer shall be
                  liable for all and any claims for a Breach.

         9.3 Claim  Procedures.  Each  party  that  desires  to make a Claim for
indemnification  pursuant  to this  Article IX (an  "Indemnified  Party")  shall
provide  notice  (a  "Claim  Notice")  thereof  in  writing  to  Buyer  (if  the
Indemnified  Party is a  Seller  Indemnified  Party)  or to the  Seller  (if the
Indemnified  Party  is  a  Buyer  Indemnified  Party)  ("Indemnifying   Party"),
specifying  the nature and basis for such claim and a copy of all papers  served
with respect to such claim (if any).  Any claim in respect of which notice shall
have been given in  accordance  with this  Section  shall be deemed to have been
irrevocably withdrawn and lapsed (not having been previously satisfied,  settled
or withdrawn) if  proceedings  in respect of such claim have not been issued and
notice of such  issuance  delivered  to the  relevant  Party not later  than the
expiry of the period of 6 months after the date of such notice.  For purposes of
this Section 9.3, receipt by a party of written notice of any Third-Party  Claim
which  gives  rise to a Claim on  behalf  of such  party  shall  require  prompt
delivery  of a Claim  Notice to the  Indemnifying  Party of the  receipt of such
Third-Party Claim;  provided,  however,  that an Indemnified  Party's failure to
send or delay in sending a Claim Notice shall not relieve an Indemnifying  Party
from  liability  hereunder  with  respect to such Claim except to the extent and
only to the extent  the  Indemnifying  Party is  materially  prejudiced  by such
failure or delay.

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         9.4 Calculation, Timing, Manner and Characterization of Indemnification
Payments.

                  (a) Subject to the provisions hereof,  payments of all amounts
owing by an Indemnifying  Party as a result of a Third-Party Claim shall be made
as and when damages with respect thereto are incurred by the  Indemnified  Party
and within five Business Days after the Indemnified  Party makes demand therefor
to the  Indemnifying  Party.  Payments of all amounts  owing by an  Indemnifying
Party  other than as a result of a  Third-Party  Claim shall be made within five
Business Days after the later of (i) the date the  Indemnifying  Party is deemed
liable therefor pursuant to this Article IX or (ii) if disputed, the date of the
adjudication of the  Indemnifying  Party's  liability to the  Indemnified  Party
under this Agreement. All amounts due and payable under this Article IX (y) with
respect to a  Third-Party  Claim,  shall bear interest at the Past Due Rate from
the date due and payable hereunder until the date paid and (z) with respect to a
claim other than a Third-Party  Claim,  shall bear interest at the Past Due Rate
from the date the  Indemnified  Party  suffers the  damages  until the date paid
except that interest  payable with respect to any delinquent  Earn-Out  Payments
shall be governed by Section 3.4.

                  (b) Any indemnity payments made hereunder shall be treated for
all Tax  purposes as an  adjustment  to the  Purchase  Price,  unless  otherwise
required by applicable Legal Requirements.

         9.5 Survival. Except to the extent expressly limited by this Agreement,
the representations,  warranties,  covenants,  and indemnities set forth in this
Agreement shall survive the Closing and delivery of the Transaction Documents.

         9.6 Control of Third-Party Claims.

                  (a) In the event of the  assertion of any  Third-Party  Claim,
the Indemnifying Party, at its option, may assume (with legal counsel reasonably
acceptable to the Indemnified Party) at its sole cost and expense the defense of
such  Third-Party  Claim if it acknowledges to the Indemnified  Party in writing
its obligations to indemnify the Indemnified  Party with respect to all elements
of such Third-Party Claim and may assert any defense of the Indemnified Party or
the Indemnifying Party; provided that the Indemnified Party shall have the right
at its own expense to  participate  jointly with the  Indemnifying  Party in the
defense  of  any  such  Third-Party   Claim.   Counsel   representing  both  the
Indemnifying  Party and the  Indemnified  Party must  acknowledge in writing its
obligation  to act as  counsel  for  all  parties  being  represented  and  must
acknowledge and respect separate attorney-client privileges with respect to each
party represented.  If the Indemnifying Party elects to undertake the defense of
any Third-Party Claim hereunder,  the Indemnified Party shall cooperate with the
Indemnifying  Party in the  defense  or  settlement  of the  Third-Party  Claim,
including  providing  access to  information,  making  documents  available  for
inspection  and  copying,   and  making  employees   available  for  interviews,
depositions and trial.  The  Indemnifying  Party shall not be entitled to settle
any  Third-Party  Claim  without the prior  written  consent of the  Indemnified
Party, which consent shall not be unreasonably withheld or delayed.

                  (b) If the  Indemnifying  Party, by the 30th day after receipt
of notice of any Third-Party  Claim (or, if earlier,  by the tenth day preceding
the day on which an answer or other  pleading must be served in order to prevent
judgment by default in favor of the person  asserting  such  Third-Party  Claim)
does not assume  actively and in good faith the defense of any such  Third-Party
Claim  or  action  resulting  therefrom,  the  Indemnified  Party  may,  at  the
Indemnifying  Party's  expense,  defend against such claim or litigation,  after
giving  notice  of the  same to the  Indemnifying  Party,  on such  terms as the
Indemnified  Party may deem  appropriate,  and the  Indemnifying  Party shall be
entitled to  participate  in (but not control) the defense of such action,  with
its counsel and at its own expense.  The  Indemnified  Party shall not settle or
compromise  any  Third-Party  Claim for which it is entitled to  indemnification
hereunder,  without the prior written consent of the  Indemnifying  Party (which
shall not be unreasonably withheld or delayed).

                  (c)  Notwithstanding  anything  in  this  Section  9.6  to the
contrary,  Buyer  shall in all cases be  entitled  to control  the  defense of a
Third-Party  Claim if Buyer  reasonably  believes such  Third-Party  Claim could
adversely effect in any material respect Buyer or its Affiliates other than as a
result of money damages or if injunctive or other  non-monetary  relief has been
sought against Buyer or its Affiliates.

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<PAGE>
                  (d)  Buyer  shall  and shall  cause  any EUE  Company  to take
reasonable  steps to mitigate any loss  suffered  arising from any Breach by the
Sellers and/or Major Shareholders.

         9.8  Offset  Rights and  Limitations.  If any  amounts  are owing or in
dispute to Buyer from any Major Shareholder in accordance with the terms of this
Agreement,  the relevant  Major  Shareholders  may elect (at its sole option) to
offset Major Shareholder Indemnified Liabilities when they become payable as set
forth in Section 9.4 against the Buyer  Shares that were  delivered to the Major
Shareholders  by  surrendering  that  number  of shares  of Buyer  common  stock
("Offset Shares") with a value (calculated on the market price of such shares at
the time of  notifying  Buyer of such  election)  equal to the amount due to the
Buyer by notifying  Buyer of such election  within the  appropriate  time period
specified in Section 9.4. Major  Shareholder  shall deliver the Offset Shares to
Buyer along with duly  endorsed  stock  transfer  forms within five days of such
election.  In the event that Major  Shareholder fails to make such election with
such time  period or  deliver  the  Offset  Shares to Buyer  within the five day
period, then the Major Shareholder  Indemnified  Liabilities shall be payable in
cash.

         9.9 Express Negligence.  THE PARTIES HERETO INTEND THAT THE INDEMNITIES
SET  FORTH IN THIS  ARTICLE  IX BE  CONSTRUED  AND  APPLIED  AS  WRITTEN  ABOVE,
NOTWITHSTANDING  ANY RULE OF CONSTRUCTION TO THE CONTRARY.  WITHOUT LIMITING THE
FOREGOING,  BUT LIMITED TO THE EXTENT PROVIDED  ABOVE,  SUCH  INDEMNITIES  SHALL
APPLY  NOTWITHSTANDING  ANY STATE'S  "EXPRESS  NEGLIGENCE"  OR SIMILAR RULE THAT
WOULD DENY COVERAGE BASED ON AN INDEMNIFIED  PARTY'S SOLE OR CONCURRENT,  ACTIVE
OR PASSIVE NEGLIGENCE OR GROSS NEGLIGENCE. IT IS THE INTENT OF THE PARTIES THAT,
TO THE EXTENT PROVIDED ABOVE, THE INDEMNITIES SET FORTH IN THIS ARTICLE IX SHALL
APPLY TO AN INDEMNIFIED PARTY'S SOLE OR CONCURRENT, ACTIVE OR PASSIVE NEGLIGENCE
OR GROSS NEGLIGENCE.  THE PARTIES AGREE THAT THIS PROVISION IS "CONSPICUOUS" FOR
PURPOSES OF ALL STATE LAWS.

         9.10 Injunctive  Relief.  In the event of a breach or threatened breach
by any Major  Shareholder  of any of the provisions of Sections 7.2, 7.3 or 7.5,
Buyer  shall  be  entitled  to  immediate   injunctive   relief,  as  the  Major
Shareholders  acknowledge  and agree  that any such  breach  would  cause  Buyer
irreparable  injury for which they would have no adequate remedy at law; and (b)
any party  hereto  shall be entitled to seek  specific  performance  against any
other party hereto pursuant to Section 10.11.

                                    ARTICLE X
                                  MISCELLANEOUS

         10.1  Assignment.  This  Agreement and the rights  hereunder may not be
assigned  by Buyer  without  the  prior  written  consent  of the  Seller.  This
Agreement and the rights hereunder may not be assigned by any Seller without the
prior written consent of Buyer.  Subject to the foregoing,  this Agreement shall
be  binding  upon and  inure to the  benefit  of the  parties  hereto  and their
respective successors and assigns.

         10.2 Notices.  Unless otherwise provided herein,  any notice,  request,
consent, instruction or other document to be given hereunder by any party hereto
to another  party  hereto  shall be in writing and will be deemed given (a) when
received if delivered  personally  or by courier;  or (b) on the date receipt is
acknowledged if delivered by certified  mail,  postage  prepaid,  return receipt
requested or (c) one day after  transmission  if sent by facsimile  transmission
with confirmation of transmission, as follows:

         If to any of the EUE Shareholders, to emw law LLP alone.
         emw law LLP
         Seckloe House, 101 North 13th Street
         Central Milton Keynes MK9 3NX
         Attention: Ian Zant-Boer

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<PAGE>
         If to Buyer, addressed to:

         COMPOSITE TECHNOLOGY CORPORATION
         2026 McGaw Avenue
         Irvine, California 92614

         With a copy to:

         RICHARDSON & PATEL LLP
         10900 Wilshire Boulevard, Suite 500
         Los Angeles, California 90024
         Attention: Kevin Leung

or to such other place and with such other copies as either party may  designate
as to itself by written  notice to the others in  accordance  with this  Section
10.2.

         10.3 Choice of Law;  Arbitration.  This Agreement shall be governed by,
and construed in accordance with, the laws of the State of California applicable
to contracts made and wholly performed within such State, regardless of the laws
that might otherwise  govern under  applicable  principles of conflicts of laws.
Any controversy,  dispute or claim of any nature  whatsoever  arising out of, in
connection  with or in  relation  to this  Agreement  will be  resolved by final
binding  arbitration  in accordance  with the American  Arbitration  Association
(International)  Rules by a retired judge at Judicial  Arbitration and Mediation
Service (JAMS) in Los Angeles, California and all parties hereto consent to such
jurisdiction for such arbitration and enforcement of any awards by JAMS.

         10.4 Entire Agreement; Amendments and Waivers. This Agreement, together
with all  Exhibits,  Annexes and  Schedules  hereto,  and the other  Transaction
Documents  constitute the entire agreement between the parties pertaining to the
subject matter hereof and supersedes all prior and  contemporaneous  agreements,
understandings,  negotiations and discussions,  whether oral or written,  of the
parties  including the letter of intent dated February 28, 2006 and there are no
other  warranties,  representations  or other agreements  between the parties in
connection with the subject matter.  No amendment,  supplement,  modification or
waiver of this  Agreement  shall be  binding  unless  executed  by Buyer and the
Majority-In-Interest  of Parent  Company.  No waiver of any of the provisions of
this  Agreement  shall be  deemed  or shall  constitute  a waiver  of any  other
provision  hereof (whether or not similar),  nor shall such waiver  constitute a
continuing waiver unless expressly agreed to in writing by the affected party.

         10.5 Multiple  Counterparts.  This  Agreement may be executed in one or
more counterparts,  each of which shall be deemed an original,  but all of which
together shall constitute one and the same instrument. Facsimile signature pages
shall  suffice for  Closing  with the  agreement  that  original  pages shall be
forthcoming.

         10.6 Expenses.  Each party hereto will be responsible for its own legal
fees  and  other  expenses   incurred  in  connection   with  the   negotiation,
preparation,  execution or performance of this  Agreement.  Notwithstanding  the
foregoing,  any  stamp  taxes or other  transfer  taxes or duties  payable  upon
transfer  of the shares of the Parent  Company  from  Sellers to Buyer  shall be
borne by the Buyer  and on  Closing  the Buyer  shall  transfer  payment  of the
Sellers'   legal  costs  up  to  a  total   maximum   amount  of  $400,000  plus
disbursements.

         10.7  Invalidity.  In the event that any one or more of the  provisions
contained in this Agreement or in any other instrument referred to herein shall,
for any reason, be held to be invalid,  illegal or unenforceable in any respect,
such  invalidity,  illegality  or  unenforceability  shall not  affect any other
provision of this Agreement or any other such instrument.

         10.8  References;  Headings;  Interpretation.  All  references  in this
Agreement to Annexes, Exhibits, Schedules,  Articles, Sections,  subsections and
other  subdivisions  refer to the corresponding  Annexes,  Exhibits,  Schedules,
Articles,  Sections,  subsections and other subdivisions of or to this Agreement
unless expressly  provided  otherwise.  Titles appearing at the beginning of any
Articles, Sections,  subsections or other subdivisions of this Agreement are for
convenience  only, do not  constitute any part of this  Agreement,  and shall be
disregarded  in  construing  the language  hereof.  The words "this  Agreement,"
"herein,"  "hereby,"  "hereunder" and "hereof" and words of similar import refer
to this  Agreement  as a  whole  and not to any  particular  subdivision  unless
expressly  so  limited.  The words  "this  Article,"  "this  Section"  and "this
subsection"  and words of similar  import refer only to the Article,  Section or
subsection hereof in which such words occur. The word "or" is not exclusive, and
the word "including" (in its various forms) means including without  limitation.
Pronouns in  masculine,  feminine or neuter  genders shall be construed to state
and include  any other  gender,  and words,  terms and titles  (including  terms
defined  herein) in the  singular  form shall be construed to include the plural
and vice versa, unless the context otherwise requires.  All references to "$" or
"dollars," in the  Agreement  shall refer to the United  States  dollars  unless
otherwise specifically noted.

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         10.9 No Third Party  Beneficiaries.  This  Agreement  is solely for the
benefit  of the  parties  hereto,  the Buyer  Indemnified  Parties,  the  Seller
Indemnified  Parties,  emw law LLP and their  successors  and assigns  permitted
under this  Agreement,  and no provisions of this  Agreement  shall be deemed to
confer upon any other Persons any remedy, claim, liability, reimbursement, cause
of action or other right except as expressly provided herein.

         10.10 No Presumption Against Any Party.  Neither this Agreement nor any
uncertainty  or ambiguity  herein  shall be  construed  or resolved  against any
party,  whether under any rule of  construction  or otherwise.  On the contrary,
this  Agreement  has been  reviewed by each of the parties and their counsel and
shall be construed  and  interpreted  according  to the ordinary  meaning of the
words used so as to fairly accomplish the purposes and intentions of all parties
hereto.

         10.11 Specific Performance. Each of the parties hereto acknowledges and
agrees that the other parties  hereto would be damaged  irreparably in the event
any of the  provisions of this  Agreement  are not performed in accordance  with
their specific terms or otherwise are breached. Accordingly, each of the parties
hereto agrees that the other parties hereto shall be entitled,  to an injunction
or  injunctions  to prevent  breaches of the provisions of this Agreement and to
enforce  specifically  this Agreement and the terms and provisions hereof in any
action  instituted in any court of the United States or any State thereof having
jurisdiction  over the parties  hereto and the matter,  in addition to any other
remedy to which they may be entitled, at law or in equity.

                                   ARTICLE XI
                                   TERMINATION

         11.1 Termination. This Agreement may be terminated prior to the Closing
(whether  before  or  after  receipt  of  either  or both  Required  Stockholder
Approvals):

                  (a) by mutual written  consent of the Parties duly  authorized
by the  board of  directors  of Buyer  and the  Majority-in-Interest  of  Parent
Company;
                  (b) by  either  the Buyer or the  Majority-in-Interest  of the
Parent  Company  if a court of  competent  jurisdiction  or  other  Governmental
Authority shall have issued a final and nonappealable  order,  decree or ruling,
or shall  have  taken  any  other  action,  having  the  effect  of  permanently
restraining, enjoining or otherwise prohibiting the Transactions;

                  (c) by the  Majority-in-Interest  of the Parent  Company,  (i)
upon a breach of any representation, warranty, covenant or agreement on the part
of Buyer set forth in this Agreement,  or if any  representation  or warranty of
Buyer shall have become  inaccurate,  in either case such that any condition set
forth in Section 8.3 would not be  satisfied as of the time of such breach or as
of the time such  representation  or  warranty  shall  have  become  inaccurate;
provided that if such  inaccuracy in Buyer's  representations  and warranties or
breach by Buyer is curable by Buyer,  then this  Agreement  shall not  terminate
pursuant  to this  Section  11.1(c)  as a result  of such  particular  breach or
inaccuracy  until the earlier of (A) the expiration of a fifteen (15) day period
commencing upon delivery of written notice from the  Majority-in-Interest of the
Parent  Company to Buyer of such breach or  inaccuracy  and (B) Buyer ceasing to
exercise  commercially   reasonable  efforts  to  cure  such  breach  (it  being
understood  that this  Agreement  shall not  terminate  pursuant to this Section
11.1(c) as a result of such  particular  breach or  inaccuracy if such breach by
Buyer is cured prior to such termination becoming effective) and (ii) any of the
closing  conditions  in Section  8.1 and 8.3 have not been  satisfied  or waived
within 30 days of the Closing Date.; or

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<PAGE>
                  (d) by  Buyer,  (i)  upon  a  breach  of  any  representation,
warranty,  covenant  or  agreement  on the part of any  Seller set forth in this
Agreement,  or if any representation or warranty of any Seller shall have become
inaccurate,  in either  case such that any  condition  set forth in Section  8.2
would  not be  satisfied  as of the time of such  breach  or as of the time such
representation or warranty shall have become  inaccurate;  provided that if such
inaccuracy  in Seller's  representations  and  warranties or breach by Seller is
curable by Seller,  then this  Agreement  shall not  terminate  pursuant to this
Section  11.1(d) as a result of such particular  breach or inaccuracy  until the
earlier  of (A) the  expiration  of a fifteen  (15) day period  commencing  upon
delivery of written notice from Buyer to Seller of such breach or inaccuracy and
(B) Seller  ceasing to  exercise  commercially  reasonable  efforts to cure such
breach (it being understood that this Agreement shall not terminate  pursuant to
this Section 11.1(d) as a result of such particular breach or inaccuracy if such
breach by Seller is cured prior to such termination becoming effective) and (ii)
any of the closing  conditions in Section 8.1 and 8.2 have not been satisfied or
waived within 30 days of the Closing Date.

          11.2 Effect of  Termination.  In the event of the  termination of this
Agreement as provided in Section  11.1,  this  Agreement  shall be of no further
force or effect, provided,  however, that (i) Sections 7.5, 7.7, 10.3, 10.10 and
10.11 shall survive the  termination  of this Agreement and shall remain in full
force and effect,  and (ii) the  termination of this Agreement shall not relieve
any Party from any  liability  for any breach of any  representation,  warranty,
covenant, obligation or other provision contained in this Agreement.

         IN WITNESS  WHEREOF,  the undersigned have executed this Share Exchange
Agreement as of the day and year first above written.

                                    "Buyer"
                                    COMPOSITE TECHNOLOGY CORPORATION

                                    By: /s/ Benton Wilcoxon
                                       -----------------------------------------
                                       Benton Wilcoxon
                                       Chief Executive Officer

Stephen Bircher

 /s/ Stephen Bircher
-----------------------------------
Address:

-------------------------------------------------------

-------------------------------------------------------

-------------------------------------------------------

Ian Zant-Boer (as attorney for the Sellers save for
Stephen Bircher)

 /s/ Ian Zant-Boer
-----------------------------------

Address:

-------------------------------------------------------

-------------------------------------------------------

-------------------------------------------------------

--------------------------------------------------------------------------------
Share Exchange Agreement - CTC & Shareholders of EU Energy plc           Page 40
<PAGE>

Michael Porter

 /s/ Michael Porter
-------------------------------------

Address:

-------------------------------------------------------

-------------------------------------------------------

-------------------------------------------------------

-------------------------------------------------------

--------------------------------------------------------------------------------
Share Exchange Agreement - CTC & Shareholders of EU Energy plc           Page 41

<PAGE>

                                    EXHIBIT A

                                  DEFINED TERMS

         Accounts  Receivable  means  all  accounts  and notes  receivable  from
account,  note and other debtors of the EUE Companies outstanding as of the date
hereof.

         Acquisition Proposal, with respect to any EUE Company, (i) any inquiry,
proposal or offer for a merger, consolidation,  dissolution, acquisition or sale
of substantial stock or assets, tender offer,  recapitalization,  share exchange
or other  business  combination  involving such EUE Company or any subsidiary of
such EUE Company, (ii) any proposal for the issuance by such EUE Company of over
10% of its equity  securities  or (iii) any  proposal or offer to acquire in any
manner,   directly  or  indirectly,   over  10%  of  the  equity  securities  or
consolidated total assets of such EUE Company, in each case other than the share
exchange transaction contemplated by this Agreement.

         Affiliate means with respect to any Person, any Person which,  directly
or  indirectly,  controls,  is controlled by, or is under a common control with,
such Person. The term "control"  (including the terms "controlled by" and "under
common control with") as used in this definition means the possession,  directly
or  indirectly,  of the power to direct or cause the direction of management and
policies of a Person,  whether  through the ownership of voting  securities,  by
contract, or otherwise. With respect to any natural person, the term "Affiliate"
shall  also mean (1) the  spouse of such  Person;  and any trust  whose  primary
beneficiary is such Person,  such Person's spouse, such Person's siblings and/or
one or more of such Person's lineal descendants, (2) the legal representative or
guardian of such Person or of any such immediate family member in the event such
Person or any such immediate family member becomes mentally  incompetent and (3)
any Person  controlled  by or under the common  control  with any one or more of
such Person and the Persons described in clauses (1) or (2) preceding.

         Agreement has the meaning set forth in the introductory paragraph.

         Audited Financial Statements has the meaning set forth in Section 5.15.

         Applicable Accounting Standards means the generally accepted accounting
standards of the United States and United Kingdom, consistently applied.

         Books and  Records  means all books and records  pertaining  to the EUE
Companies, the Business, and the EUE Assets,  including, but not limited to, all
books of account, journals and ledgers, files, correspondence,  memoranda, maps,
plats,  customer  lists,  suppliers  lists,  personnel  records  relating to the
employees of the EUE Companies, catalogs, promotional materials, data processing
programs and other computer software, building and machinery diagrams and plans.

         Business  means the  business and  operations  as are  currently  being
performed by the EUE Companies, including the manufacture, sale and distribution
of wind energy industry products.

         Business  Day  means  any day other  than a  Saturday,  Sunday or legal
holiday under the laws of the United States or the State of California.

         Buyer has the meaning set forth in the introductory paragraph.

         Buyer  Indemnified  Liabilities  has the  meaning  set forth in Section
9.2(a).

         Buyer Indemnified Parties has the meaning set forth in Section 9.1(a).

         Claim means any and all claims,  causes of action,  demands,  lawsuits,
suits,  proceedings,  governmental  investigations or audits and  administrative
orders.

--------------------------------------------------------------------------------
Exhibit "A": Share Exchange Agreement - CTC                              Page 42
& Shareholders of EU Energy plc
<PAGE>

         Claim Notice has the meaning set forth in Section 9.3.

         Closing means the fulfillment of the conditions listed in Section 8..

         Closing Date has the meaning set forth in Section 3.1.

         Code means the Internal Revenue Code of 1986, as amended.

         Competing Business has the meaning set forth in Section 7.2(a)(i)(A).

         Contract  means any  contract,  agreement,  option,  right to  acquire,
preferential purchase right,  preemptive right, warrant,  indenture,  debenture,
note,  bond,  loan,  loan agreement,  collective  bargaining  agreement,  lease,
mortgage, franchise, license, purchase order, bid, commitment, letter of credit,
guaranty,  surety or any other  legally  binding  arrangement,  whether  oral or
written.

         Creditors' Rights has the meaning set forth in Section 4.1.

         Damages means all debts,  liabilities,  obligations,  losses, including
diminution  of value,  damages,  loss of  profits,  cost and  expenses,  whether
actual,  consequential or punitive,  interest  (including,  without  limitation,
prejudgment interest), penalties, reasonable legal fees, disbursements and costs
of investigations, deficiencies, levies, duties and imposts.

         Due Diligence  Documents means the documents and disclosures  that have
been  specifically  identified as  "disclosure  documents"  and  transferred  on
permanent  electronic memory storage (WORM device) and received by the Buyer and
its US Counsel prior to the end of business, on June 9, 2006 clearly labeled and
referencing the present Agreement.

         Entity means a corporation,  partnership,  limited  liability  company,
trust or any other similar entity.

         Environmental Authority means any department,  agency, or other body or
component of any Governmental  Authority that exercises any form of jurisdiction
or authority under any Environmental Law.

         Environmental Authorization means any license, permit, order, approval,
consent,  notice,  registration,  filing or other form of  permission  or action
required under any Environmental Law.

         Environmental Laws means all federal, state, local and foreign laws and
regulations  relating  to  pollution  or  protection  of  human  health  or  the
environment  (including without limitation ambient air, surface,  water,  ground
water, land surface or subsurface strata), including without limitation laws and
regulations relating to emissions,  discharges,  Releases or threatened Releases
of Hazardous  Materials or otherwise  relating to the  manufacture,  processing,
distribution,  use,  treatment,  storage,  disposal,  transport  or  handling of
Hazardous Materials.

         Environmental  Liabilities  means  any and all  obligations  to pay the
amount of any judgment or settlement, the cost of complying with any settlement,
judgment  or  order  for  injunctive  or  other  equitable  relief,  the cost of
compliance  or  corrective  action in response to any notice,  demand or request
from an  Environmental  Authority,  the cost of performing  any remedial  action
required  under  Environmental  Laws  in  response  to a  Release  of  Hazardous
Materials, the amount of any civil penalty or criminal fine, and any court costs
and reasonable amounts for attorneys' fees, fees for witnesses and experts,  and
costs of  investigation  and preparation for defense of any claim or proceeding,
regardless  of  whether  such  claim or  proceeding  is  threatened,  pending or
completed,  that may be or have been asserted  against or imposed upon any owner
or operator of the Business, to the extent any of the foregoing arise out of:

         (a)  failure  of  an  EUE  Company  or  any  of  its  Affiliates,   any
Predecessor,  or the Business to comply at any time before the Closing Date with
all Environmental Laws;

--------------------------------------------------------------------------------
Exhibit "A": Share Exchange Agreement - CTC                              Page 43
& Shareholders of EU Energy plc
<PAGE>

         (b) presence of any Hazardous Materials on, in, under, at or in any way
affecting any property used in the Business at any time before the Closing Date;

         (c) a Release at any time  before  the  Closing  Date of any  Hazardous
Materials on, in, at, under or in any way affecting the Business or any property
used therein or at, on, in, under or in any way  affecting  any adjacent site or
facility;

         (d)  identification  of an EUE Company or any of its  Affiliates or any
Predecessor as a potentially  responsible  party under any Environmental Law for
matters relating to the period prior to Closing;

         (e)  presence at any time before the Closing  Date of any  above-ground
and/or underground  storage tanks, or any  asbestos-containing  material on, in,
at, or under any property used in connection with the Business; or

         (f) any and all claims  for  injury or damage to  persons  or  property
arising out of exposure to Hazardous  Materials  originating  at the Business or
any adjoining  property,  resulting  from operation  thereof,  or located at the
Business, where such exposure allegedly occurred prior to the Closing Date.

         EUE Assets means all of the assets, whether real, personal (tangible or
intangible) or mixed, owned (in fee or any lesser interest  including  leasehold
interests) by the EUE Companies.

         EUE Companies has the meaning set forth in the recitals

         EUE Intellectual  Property means all Intellectual Property Rights owned
by or licensed to any of the EUE Companies.

         EUE Organizational Documents has the meaning set forth in Section 5.1.

         EUE Products has the meaning set forth in Section 7.2(a)(i).

         EUE Registered  Intellectual Property means all Registered Intellectual
Property owned by any EUE Company.

         EUE  Shareholders  has  the  meaning  set  forth  in  the  introductory
paragraph.

         EUE Maintenance has the meaning set forth in the recitals.

         EUE US has the meaning set forth in the recitals.

         Facilities has the meaning set forth in Section 5.8(c).

         Financial Statements has the meaning set forth in Section 5.15.

         GAAP  means  generally  accepted  accounting  principles  in the United
States, UK or Germany (as appropriate).

         Governmental  Authority  means  any  governmental,  quasi-governmental,
state,  county, city or other political  subdivision of the United States or any
other country, or any agency, court or instrumentality,  foreign or domestic, or
statutory or regulatory body thereof.

         Hazardous  Materials  shall mean chemicals,  pollutants,  contaminants,
wastes and toxic substances,  including without limitation, materials designated
as solid or hazardous waste, hazardous substances or toxic substances.

--------------------------------------------------------------------------------
Exhibit "A": Share Exchange Agreement - CTC                              Page 44
& Shareholders of EU Energy plc
<PAGE>

         Indemnified Party has the meaning set forth in Section 9.3.

         Indemnifying Party has the meaning set forth in Section 9.3.

         Insurance Policies has the meaning set forth in Section 5.27.

         Intellectual  Property  Rights means all United  States and foreign (i)
patents,   patent   applications,   utility   models  or   statutory   invention
registrations   (whether  or  not  filed),  and  invention   disclosures;   (ii)
trademarks,  service marks,  logos,  designs,  trade names, trade dress,  domain
names and corporate names and  registrations  and  applications for registration
thereof  (whether or not filed) and the  goodwill  associated  therewith;  (iii)
copyrights,   whether   registered  or  unregistered,   and   registrations  and
applications for registration  thereof (whether or not filed) and other works of
authorship,   whether  or  not  published;   (iv)  trade  secrets,   proprietary
information,  know-how,  inventions,  customer lists and  information,  supplier
lists,   manufacturer   lists,   manufacturing  and  production   processes  and
techniques,  blueprints,  drawings, schematics,  manuals, software, firmware and
databases;  (v) the right to sue and collect damages for any past, present,  and
future  infringement,  misappropriation,  or  other  violation  of  any  of  the
foregoing; and (vi) rights relating to any of the foregoing.

         Interest  means  (a)  capital  stock,  member  interests,   partnership
interests,  other equity  interests,  rights to profits or revenue and any other
similar  interest,  (b) any  security  or  other  interest  convertible  into or
exchangeable  or  exercisable  for  any of  the  foregoing  and  (c)  any  right
(contingent or otherwise) to acquire any of the foregoing.

         Knowledge of the Major  Shareholders means the knowledge of each of the
Major Shareholders after reasonable investigation.

         Leased Real Property has the meaning set forth in Section 5.8(c).

         Legal Requirement means any law, statute, code, ordinance, order, rule,
regulation,  judgment,  decree,  injunction,   franchise,  permit,  certificate,
license,  authorization,  or other directional requirement  (including,  without
limitation,  any of the  foregoing  that relates to  environmental  standards or
controls,  energy  regulations and occupational,  safety and health standards or
controls including those arising under  Environmental  Laws) of any Governmental
Authority.

         Lien means any lien, pledge,  condemnation award,  claim,  restriction,
charge,  preferential purchase right, security interest, mortgage or encumbrance
of any nature whatsoever including as a statutory landlord lien.

         Majority-in-Interest of Parent Company means those shareholders holding
a majority of the outstanding capital interest of Parent Company.

         Major  Shareholders  has the  meaning  set out in the  preamble to this
Agreement.

         Material  Adverse  Effect means any material and adverse  effect on the
assets, liabilities,  financial condition,  business,  operations, or affairs of
any EUE Company or the Business.

         Material Contract has the meaning set forth in Section 5.11(a).

         Material  Waiver means a waiver by the relevant Party of a provision of
a Material  Contract  which  waiver  will  result in an EUE  Company  either (i)
receiving less  consideration  under the Material  Contract than would have been
received  without the waiver,  or (ii)  incurring  greater  liability  under the
Material Contract than would have been incurred without the waiver.

         Non-Competition Parties has the meaning set forth in Section 7.2.

         Occurrence has the meaning set forth in Section 5.21(b).

--------------------------------------------------------------------------------
Exhibit "A": Share Exchange Agreement - CTC                              Page 45
& Shareholders of EU Energy plc
<PAGE>

         Ordinary  Course  of  Business  means,  when used in  reference  to any
Person,  the  ordinary  course of  business  consistent  with past  customs  and
practices of such Person.

         Organizational  Documents  means,  with respect to a particular  Person
(other than a natural  person),  the  certificate or articles of  incorporation,
bylaws,  partnership  agreement,  limited  liability  company  agreement,  trust
agreement or similar  organizational  document or agreement,  as applicable,  of
such Person.

         Party means any party to this Agreement.

         Parent Company has the meaning set forth in the recitals.

         Parent Company Shares has the meaning set forth in the recitals.

         Permit has the meaning set forth in Section 5.10.

         Permitted Liens means:

                           (i)  Liens  for  Taxes  which  are  not  yet  due and
payable;

                           (ii)  inchoate  Liens  arising by  operation  of law,
including materialman's, mechanic's, repairman's,
laborer's,  warehousemen,  carrier's,  employee's,  contractor's  and operator's
Liens  arising in the  Ordinary  Course of Business  but only to the extent such
liens secure  obligations  that, as of the Closing,  are not due and payable and
are not being  contested  unless being  contested in good faith and a reserve or
other appropriate provision, if any, as required by GAAP is made therefor in the
Financial Statements; and

                           (iii)  Liens from one EUE Company in favor of another
EUE Company

         Person  means  any  natural  person,  firm,  partnership,  association,
corporation,  limited liability company,  company, trust, entity, public body or
government.

         Personal Property has the meaning set forth in Section 5.9(c).

         Plan or Plans has the meaning set forth in Section 5.23(a).

         Porter means Michael Porter.

         Predecessor shall mean any Person whose liabilities,  including without
limitation  liabilities  arising under any  Environmental  Law, have or may have
been  retained or assumed by any Seller Party or any of its  Affiliates,  either
contractually or by operation of law.

         Product has the meaning set forth in Section 5.21(b).

         Prohibited Period has the meaning set forth in Section 7.2(a)(i).

         Purchase Price has the meaning set forth in Section 2.2.

         Recalls has the meaning set forth in Section 5.21(b).

         Registered   Intellectual   Property  shall  mean  all  United  States,
international  and  foreign:  (i)  patents  and patent  applications  (including
provisional   applications);   (ii)  registered   trademarks  and  servicemarks,
applications  to  register   trademarks  and  servicemarks   and   intent-to-use
applications;   (iii)  registered  copyrights  and  applications  for  copyright
registration; (iv) any mask work registrations and applications to register mask
works;  and (v) any  other  Intellectual  Property  that  is the  subject  of an
application,  certificate,  filing,  registration  or other document  issued by,
filed  with,  or  recorded  by,  any state,  government  or other  public  legal
authority.

--------------------------------------------------------------------------------
Exhibit "A": Share Exchange Agreement - CTC                              Page 46
& Shareholders of EU Energy plc
<PAGE>

         Release shall mean "release" as defined in any Environmental Law.

         Restricted Area has the meaning set forth in Section 7.2(a)(i)(A)

         SEC means the United States Securities and Exchange Commission

         SEC Documents means, with respect to any Person, each report,  exhibit,
schedule,  form,  statement or other  document filed with the SEC by such Person
pursuant to Section 13(a) or 14(a) of the Exchange Act.

         Securities  Act  means  the  United  States  Securities  Act of 1933 as
amended from time to time

         Scheduled Leases has the meaning set forth in Section 5.8(b).

         Scheduled Permits has the meaning set forth in Section 5.10.

         Scheduled  Personal  Property  has the  meaning  set  forth in  Section
5.9(b).

         Seller(s) has the meaning set forth in the introductory paragraph.

         Seller Indemnified  Liabilities or Seller Indemnified Liability has the
meaning set forth in Section 9.1(a).

         Seller Indemnified Parties has the meaning set forth in Section 9.2(a).

         Subsidiary.  One Entity shall be deemed to be a "Subsidiary" of another
Entity if such second Entity  directly or indirectly  owns,  beneficially  or of
record,  (a) an amount of voting  securities  or other  interests  in such first
Entity  that is  sufficient  to enable  such  second  Entity to elect at least a
majority  of the  members of such first  Entity's  board of  directors  or other
governing  body,  or  (b)  at  least  50% of  the  outstanding  equity,  voting,
beneficial or financial interests in such first Entity.

         Tax or Taxes means any taxes, assessments, fees, unclaimed property and
escheat obligations,  and other governmental charges imposed by any Governmental
Authority,  including income, profits, gross receipts, net proceeds, alternative
or add-on minimum,  ad valorem,  real property (including  assessments,  fees or
other charges imposed by any Governmental Authority that are based on the use or
ownership  of real  property)  value  added,  turnover,  sales,  use,  property,
personal  property  (tangible and intangible),  environmental,  stamp,  leasing,
lease, user, excise, duty,  franchise,  capital stock,  transfer,  registration,
license, withholding,  social security (or similar),  unemployment,  disability,
payroll,  employment,  fuel,  excess profits,  occupational,  premium,  windfall
profit, severance, estimated, or other charge of any kind whatsoever,  including
any interest,  penalty, or addition thereto,  whether disputed or not, including
any item for which liability arises by contract or as a transferee or successor.

         Tax Items means all items of income,  gain, loss,  deduction and credit
and other tax items.

         Tax Return means any return, declaration,  report, claim for refund, or
information  return or statement  relating to Taxes,  including  any schedule or
attachment thereto, and including any amendment thereof.

         Third  Party  Claim  means a third  party  claim  asserted  against  an
Indemnified  Party by a Person other than (a) an  Affiliate of such  Indemnified
Party or (b) any director, stockholder,  officer, member, partner or employee of
any such Indemnified Party or its Affiliates.

--------------------------------------------------------------------------------
Exhibit "A": Share Exchange Agreement - CTC                              Page 47
& Shareholders of EU Energy plc
<PAGE>

         Transaction   Documents   means  this  Agreement  and  all  agreements,
conveyances,  documents,  instruments and certificates  delivered at the Closing
pursuant to this Agreement.

         Transactions means the transactions contemplated by this Agreement.

--------------------------------------------------------------------------------
Exhibit "A": Share Exchange Agreement - CTC                              Page 48
& Shareholders of EU Energy plc
<PAGE>

                                    EXHIBIT B

                     FORM OF EU ENERGY PRINCIPALS' AGREEMENT

--------------------------------------------------------------------------------
Exhibit "B": Share Exchange Agreement - CTC                              Page 49
& Shareholders of EU Energy plc
<PAGE>

                        EU Energy Principals' Agreement
                         EU ENERGY PRINCIPALS' AGREEMENT

         THIS EU ENERGY PRINCIPALS'  AGREEMENT (this  "Agreement"),  is made and
entered  into as of June __,  2006 by and  among  Stephen  Bircher  ("Bircher"),
Keeley Services Limited ("Keeley"),  Laikadog Holdings Ltd. ("Laikadog"),  Rayna
Limited ("Rayna") and Wellsford Management Limited  ("Wellsford"),  and, Michael
Porter ("Porter") on the one hand  ("collectively "EU Energy  Principals"),  and
Composite Technology Corporation, a Nevada Corporation ("Buyer").

                                    RECITALS

A. The Buyer and  substantially  all  shareholders of EU Energy including the EU
Energy  Principals  have entered  into a Share  Exchange  Agreement  (the "Share
Exchange  Agreement")  pursuant  to which the  shareholders  of EU Energy plc, a
company  organized under the laws of the United Kingdom ("EU Energy") and Porter
shall exchange their equity securities for newly-issued  stock of the Buyer (the
"Transaction").

B.  Bircher,   Keeley,  Rayna,  Wellsford,   and  Laikadog  (collectively,   the
"Shareholders")  shall  be  shareholders  of  the  Buyer  upon  closing  of  the
Transaction and Porter will be the President of the Buyer.

C. In order to induce the Buyer to complete the  Transaction,  the  Shareholders
have  agreed to the  lock-up  provisions  relating  to all of the  shares of the
common  stock of the  Buyer  owned,  as of the date of the  closing  date of the
Transaction  (the "Closing  Date"),  by each of the Shareholders as set forth in
this Agreement ("Locked Up Shares").

D. The Shareholders  have further agreed that their  outstanding  Company common
stock may be used to satisfy any indemnification obligations pursuant to Section
9 of the Share Exchange Agreement.

         NOW,  THEREFORE,  in consideration of the mutual promises and covenants
herein contained, and other valuable consideration,  the receipt and sufficiency
of which are hereby acknowledged, the parties agree as follows:

                                    AGREEMENT

1.  Lock-Up.  For a  period  of 12  months  following  the  closing  date of the
Transaction (the "Lock-Up  Period"),  each of the Shareholders  shall not make a
Transfer of the Locked Up Shares; provided however, that in each month after the
Closing Date,  1/12th of the Locked Up Shares held by each Shareholder  shall be
relieved  from such  restriction,  such that by the 12th month after the Closing
Date,  all of the Locked Up Shares shall no longer be bound by this  obligation;
provided,  however,  that  Shareholder  may not Transfer  more than 1/6th of the
Locked Up Shares  during any 30 day  period of the  Lock-Up  Period.  "Transfer"
shall mean transfer, sell, assign, pledge, hypothecate,  give, create a security
interest in or lien on, place in trust  (voting trust or  otherwise),  or in any
other way  encumber or dispose of,  directly  or  indirectly  and whether or not
voluntarily, without the express prior written consent of the Buyer.

2.  Injunctive  Relief.  The Parties  agree that a breach of this  Agreement may
cause the Buyer irreparable harm for which monetary damages are not adequate. In
addition to all other available  legal remedies,  the Buyer shall have the right
to injunctive relief to enforce this Agreement.

--------------------------------------------------------------------------------
Exhibit "B": Share Exchange Agreement - CTC                              Page 50
& Shareholders of EU Energy plc
<PAGE>

3. Other Restrictions.

         (a)  Legends.  Each  Shareholder's  Locked Up Shares  shall be  divided
equally into 12 separate stock certificates ("Stock  Certificate").  In addition
to any other  legends  required  to be placed  on each  outstanding  certificate
representing the Locked Up Shares,  each of the Shareholders  hereby agrees that
each outstanding stock certificate  representing the Locked Up Shares during the
Restricted Period shall bear a legend reading substantially as follows:

                  "THE SECURITIES REPRESENTED BY THIS CERTIFICATE ARE SUBJECT TO
                  THE TERMS AND CONDITIONS SET FORTH IN A EU ENERGY  PRINCIPALS'
                  AGREEMENT,  DATED AS OF JUNE 3,  2006  COPIES  OF WHICH MAY BE
                  OBTAINED FROM THE ISSUER.  NO TRANSFER OF SUCH SECURITIES WILL
                  BE MADE ON THE  BOOKS  OF THE  ISSUER  UNLESS  ACCOMPANIED  BY
                  EVIDENCE OF COMPLIANCE WITH THE TERMS OF SUCH  AGREEMENT.  THE
                  COMPANY  ACKNOWLEDGES  THAT THIS LEGEND (BUT THIS LEGEND ONLY)
                  RELATING TO THE EU ENERGY PRINCIPALS  AGREEMENT MAY BE REMOVED
                  AT ANY TIME AFTER [Legend Termination Date]"

         Each  of the 12  Stock  Certificates  shall  bear a  different  "Legend
Termination Date" ranging from the one-month  anniversary of the Closing Date to
the 12-month anniversary of the Closing.

         (b) Termination of Restrictive Legends. The restrictions referred to in
Section 1 shall cease and terminate in their  entirety at the end of the Lock-Up
Period. Whenever such restrictions shall cease and terminate as to any Locked Up
Shares,  the  Shareholder  holding such shares shall be entitled to receive from
the Buyer,  in exchange for such legended  certificates,  without  expense,  new
certificates  for a like  number of Locked Up Shares not  bearing the legend set
forth in Section 3(a), provided however, that if any Claim has been made against
the  Shareholder  for any  breach  of the  Share  Exchange  Agreement,  then the
Shareholder  will not be able to  remove  the  legend  on that  number of shares
sufficient to satisfy the extent of such Claim.

         (c) Copy of Agreement. A copy of this Agreement shall be filed with the
corporate  secretary of the Buyer and with the  Transfer  Agent of the Buyer and
shall be kept with the  records  of the Buyer  and shall be made  available  for
inspection by any shareholders of the Buyer.

         (d) Recordation. The Buyer shall not record upon its books any Transfer
to any person except Transfers in accordance with this Agreement.

4. Indemnification. In the event that a Shareholder is required to indemnify the
Buyer under Section 9 of the Share Exchange Agreement,  the Locked Up Shares may
be surrendered to the Buyer to satisfy such indemnification obligations.

5. Compliance With Applicable  Regulations.  The Shareholders and Porter warrant
and  confirm  that  they  shall  comply  in all  respects  with any  regulations
applicable  to the  disclosure  of their  share  holdings  in the  Buyer and the
transfer of such shares.

6. Specific  Performance.  The  Shareholders  acknowledge that there would be no
adequate  remedy  at  law  if  any  Shareholder  fails  to  perform  any  of its
obligations hereunder,  and accordingly agree that the Buyer, in addition to any
other remedy to which it may be entitled at law or in equity,  shall be entitled
to compel specific  performance of the obligations of any Shareholder under this
Agreement in accordance  with the terms and  conditions of this  Agreement.  Any
remedy under this Section 5 is subject to certain equitable  defenses and to the
discretion of the court before which any proceedings therefor may be brought.

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Exhibit "B": Share Exchange Agreement - CTC                              Page 51
& Shareholders of EU Energy plc
<PAGE>

7. Notices. All notices, statements, instructions or other documents required to
be given hereunder  shall be in writing and shall be given either  personally or
by mailing the same in a sealed envelope,  first-class mail, postage prepaid and
either certified or registered,  return receipt requested,  or by telecopy,  and
shall be  addressed  to the Buyer at its  principal  offices  and to one or more
Shareholders  at the  respective  addresses  furnished  to  the  Buyer  by  such
Shareholders.

8. Successors and Assigns.  This Agreement shall be binding upon and shall inure
to the benefit of the parties and their respective successors and assigns.

9.  Recapitalizations  and Exchanges  Affecting  Shares.  The provisions of this
Agreement  shall apply,  to the full extent set forth herein with respect to the
Shares, to any and all shares of capital stock or equity securities of the Buyer
which may be issued by reason of any stock dividend,  stock split, reverse stock
split, combination, recapitalization, reclassification or otherwise.

10.  Governing  Law.  This  Agreement  shall be  governed  by and  construed  in
accordance  with the laws of the State of  California as applied to contracts to
be performed in California.

11.  Waiver of Trial by Jury.  ANY RIGHT TO TRIAL BY JURY  WITH  RESPECT  TO ANY
CLAIM OR ACTION  ARISING  OUT OF THIS  AGREEMENT  OR IN  CONNECTION  HEREWITH IS
HEREBY WAIVED.

12.  Descriptive  Headings,   Etc.  The  headings  in  this  Agreement  are  for
convenience  of  reference  only and  shall not limit or  otherwise  affect  the
meaning  of  terms  contained  herein.  Unless  the  context  of this  Agreement
otherwise requires,  references to "hereof," "herein," "hereby," "hereunder" and
similar terms shall refer to this entire Agreement.

13.  Amendment.  This Agreement may not be amended or supplemented  except by an
instrument in writing signed by each of the parties hereto.

14. Severability. If any term or provision of this Agreement shall to any extent
be  invalid or  unenforceable,  the  remainder  of this  Agreement  shall not be
affected  thereby,  and each term and provision of this Agreement shall be valid
and enforceable to the fullest extent permitted by law.

15.  Complete  Agreement;  Counterparts.  This Agreement  constitutes the entire
agreement and supersedes all other agreements and  understandings,  both written
and oral,  among the parties or any of them,  with respect to the subject matter
hereof.  This Agreement may be executed by any one or more of the parties hereto
in any number of counterparts,  each of which shall be deemed to be an original,
but all such counterparts shall together constitute one and the same instrument.

16.  Independent  Termination.  This  Agreement  is  independent  of  any  other
agreement and will terminate on its own terms.

        ******THE SIGNATURES OF THE PARTIES APPEAR ON THE NEXT PAGE******

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Exhibit "B": Share Exchange Agreement - CTC                              Page 52
& Shareholders of EU Energy plc
<PAGE>

IN  WITNESS  WHEREOF,  the  parties  have  executed  this EU Energy  Principals'
Agreement on the above written date.

"Major Shareholders"
Stephen Bircher                                  Michael Porter

-----------------------------------              -------------------------------
                                                 By:
                                                 Title:
Address:                                         Address:

------------------------------------------------ -------------------------------

------------------------------------------------ -------------------------------

------------------------------------------------ -------------------------------

Keeley Services Limited                          Laikadog Holdings Limited

                                                 -------------------------------
-----------------------------------              By:
By:                                              Title:
Title:

Address:                                         Address:
------------------------------------------------ -------------------------------

------------------------------------------------ -------------------------------

------------------------------------------------ -------------------------------

Rayna Limited                                    Wellsford Management Limited
                                                 -------------------------------
-----------------------------------
By:                                              -------------------------------
Title:                                           By:
                                                 Title:
Address:                                         Address:
------------------------------------------------ -------------------------------

------------------------------------------------ -------------------------------

------------------------------------------------ -------------------------------

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Exhibit "B": Share Exchange Agreement - CTC                              Page 53
& Shareholders of EU Energy plc
<PAGE>

                                    EXHIBIT C

                              FORM OF LEGAL OPINION

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Exhibit "C": Share Exchange Agreement - CTC                              Page 54
& Shareholders of EU Energy plc
<PAGE>

                          OPINION OF EU ENERGY COUNSEL

1.       This opinion relates only to English law as at the date of this opinion
         and to matters  governed  by English  law  (whether  or not the English
         courts would apply  English law to the matter in question) and is based
         on the following assumptions:

1.1      that all signatures on documents  examined by us are genuine,  that all
         documents  examined  by us as copies are  complete  and  conform to the
         originals, and that the originals of such documents are authentic;

1.2      that  the  statutory  books  are  accurate  and  up to  date  with  the
         information  which is recorded therein and that any resolutions  passed
         by EU Energy plc ("the  Company")  have  conformed  with the  Company's
         memorandum  of  association  and  articles  of the  company  and  where
         necessary been quorate.

2.       Reference  to "Closing"  used within this  opinion  shall have the same
         meaning as set out in the Share  Exchange  Agreement  made  between the
         shareholders  of the Company and Composite  Technology  Corporation and
         dated 2 June 2006 ("the Agreement").

3.       The Company is a corporation  duly  incorporated,  and validly existing
         under the laws of England and Wales,  and has the  requisite  corporate
         power and  authority  to conduct its  business as and to the extent now
         conducted and to own, use and lease its assets and properties.

4.       Immediately prior to the Closing, the authorized share capital stock of
         the Company consists solely of 100,000,000 ordinary shares of par value
         (pound)0.01  per share ("Company  Common Stock").  There are 26,113,110
         shares of  Company  Common  Stock  issued.  The  Extraordinary  General
         Meeting seeking approval of the Company's  shareholders (as referred to
         under Article VII of the Agreement) was properly convened in compliance
         with English law.

5.       Other than as set forth in the Share Exchange Agreement  (including the
         Company's  Disclosure  Schedule  attached thereto and the Due Diligence
         Documents as defined  therein) to our knowledge,  the Company does not,
         as of the date hereof,  have  outstanding any  subscriptions,  options,
         warrants, rights (including "phantom" stock rights),  preemptive rights
         or other contracts, commitments, understandings, plans or arrangements,
         including  any right of conversion  or exchange  under any  outstanding
         security,  instrument or agreement,  obligating the Company to issue or
         sell any shares of capital stock of the Company or to grant,  extend or
         enter into any option with respect thereto.

6.       Other than as set forth in the Share Exchange Agreement  (including the
         Company's  Disclosure  Schedule  attached thereto and the Due Diligence
         Documents as defined  therein),  to our knowledge there are no actions,
         suits,  arbitrations,  investigations or proceedings pending or overtly
         threatened against the Company or any of its assets and properties.  To
         our knowledge, the Company is not subject to any order, writ, judgment,
         decree or injunction.

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Exhibit "C": Share Exchange Agreement - CTC                              Page 55
& Shareholders of EU Energy plc
<PAGE>

7.       Each Major Shareholder has the requisite power and authority, corporate
         or  otherwise,  to enter  into the  Share  Exchange  Agreement  and the
         Ancillary Agreements,  if any, to which it is a party (the "Transaction
         Documents"),  to perform its  obligations  thereunder and to consummate
         the  transactions  contemplated  thereby.  The execution,  delivery and
         performance of the Transaction Documents by each Major Shareholder, and
         the   consummation  by  the  Major   Shareholder  of  the  transactions
         contemplated  thereby,  have  been  duly and  validly  approved  by the
         requisite governing bodies of each Major Shareholder, such as the board
         of directors of the Seller and by the  shareholders  of the Seller,  as
         appropriate.  Each of the  Transaction  Documents  has  been  duly  and
         validly   executed  and  delivered  by  each  Major   Shareholder   and
         constitutes  the legal,  valid and  binding  obligations  of such Major
         Shareholder  enforceable  against  the  Seller in  accordance  with its
         terms;  provided,  however,  that  the  validity,  binding  nature  and
         enforceability  of such  Seller's  obligations  under  the  Transaction
         Documents may be subject to or limited by (i)  bankruptcy,  insolvency,
         reorganization,  arrangement, moratorium, fraudulent transfer and other
         similar laws affecting the rights of creditors generally;  (ii) general
         principles of equity  (whether  relief is sought in a proceeding at law
         or in equity), including, without limitation,  concepts of materiality,
         reasonableness,  good faith and fair dealing, and the discretion of any
         court of competent  jurisdiction  in awarding  specific  performance or
         injunctive  relief and other  equitable  remedies;  and (iii),  without
         limiting the  generality  of the  foregoing,  the effect of  California
         court  decisions and statutes  which  indicate  that  provisions of the
         Transaction  Documents which permit  Composite  Technology  Corporation
         ("Buyer")  or any other person or entity  ("Person")  to take action or
         make determinations may be subject to a requirement that such action be
         taken  or such  determinations  be made on a  reasonable  basis in good
         faith or that it be shown that such action is reasonably  necessary for
         the protection of Buyer or such other Person.

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Exhibit "C": Share Exchange Agreement - CTC                              Page 56
& Shareholders of EU Energy plc
<PAGE>

                                    EXHIBIT D

                          FORM OF CONSULTANCY AGREEMENT

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Exhibit "D": Share Exchange Agreement - CTC                              Page 57
& Shareholders of EU Energy plc
<PAGE>

                         EXECUTIVE EMPLOYMENT AGREEMENT

This Executive  Employment  Agreement (the "Agreement") is made and entered into
as of June ___, 2006, by and between Composite Technology Corporation,  a Nevada
corporation (the "Company"), and Michael Porter ("Executive").  In consideration
of the mutual covenants and conditions contained herein, the parties,  intending
to be  legally  bound and  acknowledging  that this  Agreement  shall  supplant,
supersede and cause to terminate the Services Agreement between EU Energy plc (a
wholly  owned  subsidiary  of the  Company  as of the  effective  date  of  this
Agreement)  and Executive  dated December 13, 2004 and the Contract for Services
between  EU Energy  plc and  Laikadog  Holdings  Limited  (an  entity  owned and
controlled by Executive), agree as follows:

                                    ARTICLE 1
                                   EMPLOYMENT

         1.1  Employment.  The Company hereby employs  Executive,  and Executive
hereby accepts  employment  with the Company,  upon the terms and subject to the
conditions  hereinafter  set forth, to hold the office of President of Composite
Technology  Corporation.  Executive  shall do and  perform,  and shall  have the
authority to do and perform,  all services,  acts and other things  necessary to
perform such tasks as may be assigned to  Executive  by the  Company.  Executive
shall adhere to the Company's policies,  ethical practices and standards of care
and competence.  Executive shall devote his full business time and attention and
best effort to the affairs of the Company, and Executive shall not engage in any
other business duties or pursuits, or directly or indirectly render any services
of a business,  commercial or professional nature to any other entity or person,
whether for compensation or otherwise,  without the prior written consent of the
Company;  provided,  however,  that Executive may  participate in charitable and
other civic functions so long as such other  activities do not adversely  affect
Executive's ability to perform his responsibilities hereunder.

         1.2  Term.  This  Agreement  shall be  effective  as of the date of the
closing of the  acquisition of EU Energy plc  (anticipated  to be July 3, 2006),
and shall, unless otherwise terminated as provided herein,  terminate on July 2,
(the "Initial Term").  The Initial Term shall be extended  automatically  for an
additional one year period on each July 2, commencing July 2, unless the Company
provides notice to the contrary (the "Non-Renewal  Notice") at least thirty (30)
days prior to the  expiration  of the  Initial  Term or any such one year period
(the period from the effective date of this Agreement  until the  termination of
this Agreement is referred to as the "Term").

                                    ARTICLE 2
                            COMPENSATION AND BENEFITS

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Exhibit "D": Share Exchange Agreement - CTC                              Page 58
& Shareholders of EU Energy plc
<PAGE>

         2.1 Base Salary.  During the Term, the Company shall pay to Executive a
base  salary  of  $400,000  per  year  (the  "Base  Salary"),  payable  in equal
semimonthly  installments,  or at  such  other  time  or  times  as the  Company
generally  pays  employees.  The Company  shall  review the Base Salary at least
annually  during the first  quarter of each  calendar  year and may increase the
Base Salary in its sole discretion.

         2.2 Annual Bonus. During the Term,  Executive shall be eligible to earn
an annual bonus, based upon the achievement, as determined by the Company in its
sole discretion.  Any such  discretionary  bonus shall be paid no later than the
end of the first  quarter of the calendar year  following  each year of the Term
and shall be payable to Executive only if Executive  continues to be employed by
the Company on the day any such annual bonus is actually paid.

         2.3 Benefits.  During the Term,  Executive and Executive's spouse shall
be  eligible  to  participate  in and shall be covered  by any and all  medical,
disability,  life and other insurance plans,  stock option  incentive  programs,
401K plans and other  benefits  generally  available  to other  employees of the
Company in similar employment  positions,  as such plans and benefits may change
from time to time, on the same terms as such  employees,  subject to meeting any
and all applicable eligibility  requirements.  Notwithstanding the foregoing, if
the medical  insurance  benefits  cannot be arranged for Michael and his wife by
the Company , then the Company agrees to pay his medical expenses.

         2.4 Employment Taxes. All payments to Executive hereunder shall be made
after deduction for any federal,  state and local withholding and payroll taxes,
all as determined  under  applicable law. The Company shall make all reports and
similar filings required by law with respect to such payments,  withholdings and
taxes.

         2.5 Vacation.  During the Term,  Executive  shall receive paid vacation
annually in accordance with the Company's practices for executive  officers,  as
in  effect  from time to time,  but in any  event  not less than four  weeks per
calendar year.

                                    ARTICLE 3
                                   TERMINATION

         3.1  Termination  for Cause.  The  Company  shall have the right at any
time,  exercisable  immediately  with  or  without  notice,  to  terminate  this
Agreement for "Cause." As used herein,  "Cause" shall mean any of the following:
(i)  Executive  materially  breaches  any  provision  of  this  Agreement;  (ii)
Executive  is indicted,  convicted  or pleads "no  contest" to a felony,  or any
other  conduct of a criminal  nature  (other  than  traffic  violations);  (iii)
Executive  engages  in fraud,  embezzlement  or any other  illegal  or  wrongful
conduct  materially  detrimental  to the  Company or the  Company's  reputation,
regardless of whether such conduct is designed to defraud the Company or others;
(iv)  Executive  takes action (or fails to take action) that  Executive  knew or
should have reasonably  known was likely to materially  damage the Company;  (v)
Executive is grossly  negligent in the performance of, or willfully  disregards,
Executive's obligations hereunder; (vi) Executive intentionally imparts material
Proprietary  Information to competitors or other third parties other than in the
course of carrying out Executive's duties hereunder;  or (vii) Executive refuses
to obey the reasonable and lawful orders of the Chief Executive Officer or Board
of Directors of the Company.  Upon  termination  for Cause,  Executive  shall be
entitled  to receive (1) the Base  Salary  then in effect and the  benefits  set
forth in Section 2.3 through the effective date of such  termination  and (2) no
other payments or  compensation  of any kind,  except to the extent  required by
law. The Company's exercise of its right to terminate  Executive for Cause shall
be without prejudice to any other remedy to which the Company may be entitled at
law, in equity or under this Agreement.

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Exhibit "D": Share Exchange Agreement - CTC                              Page 59
& Shareholders of EU Energy plc
<PAGE>

         3.2   Resignation.   Executive  shall  have  the  right  at  any  time,
exercisable  upon 60 days notice,  to resign and terminate the Agreement for any
reason or no reason. Upon Executive's  termination of this Agreement pursuant to
this  Section  3.2,  Executive  shall be entitled to receive (i) the Base Salary
then in effect and the benefits  set forth in Section 2.3 through the  effective
date or such resignation and (ii) no other payments or compensation of any kind,
except to the extent required by law.

         3.3  Termination  Due to  Death or  Disability.  This  Agreement  shall
automatically  terminate upon the death of Executive.  In addition,  the Company
shall have the right,  exercisable  upon ten (10) days notice,  to terminate the
Agreement  if  Executive is unable to perform  Executive's  duties  hereunder by
reason of any mental or physical  disability  or  incapacity  for a period of 90
consecutive  days. Upon termination due to death or disability  pursuant to this
Section 3.3,  Executive  (or  Executive's  estate,  as the case may be) shall be
entitled  to receive (i) the Base  Salary  then in effect and the  benefits  set
forth in Section 2.3 through the effective date of such  termination and (ii) no
other payments or  compensation  of any kind,  except to the extent  required by
law.

         3.4  Termination  Without  Cause or  Non-Renewal  by the  Company . The
Company  shall  have the  right at any time and  without  any  prior  notice  to
terminate  this Agreement for any reason other than as set forth in Sections 3.1
or 3.3,  or for no reason.  Upon the  Company's  termination  of this  Agreement
pursuant to this  Section  3.4,  Executive  shall be entitled to receive (i) the
Base Salary then in effect and the benefits set forth in Section 2.3 through the
effective date of such termination,  (ii) as severance pay or liquidated damages
or both,  payments at the Base  Salary rate then in effect in equal  semimonthly
installments  (or at such  other  time or times as the  Company  generally  pays
employees),  for a period of six months  following  the  effective  date of such
termination  and (iii) no other payments or  compensation  of any kind except to
the extent required by law.

         3.5 Continuation of Health Insurance Benefits.  Upon the termination of
this  Agreement for any reason other than due to  Executive's  death,  Executive
shall be  eligible  to  continue  the  health  insurance  benefits  provided  to
Executive  immediately  prior to such  termination  for the  period  of time and
subject to the terms and  conditions  required  under the  Consolidated  Omnibus
Budget Reconciliation Act of 1985 or as otherwise required by law.

                                    ARTICLE 4
                               CERTAIN AGREEMENTS

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Exhibit "D": Share Exchange Agreement - CTC                              Page 60
& Shareholders of EU Energy plc
<PAGE>

         4.1  Confidentiality.  Executive  acknowledges that the Company and its
present or future subsidiaries or affiliates,  including,  but not limited to EU
Energy plc, (which, collectively with the Company, are referred to herein as the
"Company")  owns and will own and has  developed  and will  develop  proprietary
information  concerning its business and its customers and clients which derives
value by not being generally known to the Company's  competitors or others. Such
information (the "Proprietary  Information") includes, among other things, trade
secrets,  financial  information,  prices, costs, product plans, customer lists,
marketing plans, systems,  manuals, training materials,  forecasts,  inventions,
improvements,  ideas,  business strategies,  formulas,  product ideas,  computer
programs and software, software designs and documentation,  source codes, object
codes, data and data bases,  algorithms,  techniques,  schematics,  compensation
information,   clinical  trial  information,  know-how  and  other  intellectual
property.  Executive  shall, at all times,  both during the Term and thereafter,
keep all  Proprietary  Information  in confidence  and trust and will not use or
disclose  any  Proprietary  Information  or anything  relating to it without the
prior written consent of the Company, except as may be necessary in the ordinary
course of performing Executive's duties for the Company.

         4.2 The Company's Property.  Executive  recognizes that all Proprietary
Information, however stored or memorialized, and all identification cards, keys,
access codes,  marketing  materials,  samples,  tape recordings,  notes,  tools,
documents,  records, apparatus and other equipment or property which the Company
provides  to or  makes  available  to  Executive  are the sole  property  of the
Company. Executive shall use such property solely for the benefit of the Company
and for no other  purpose.  Upon the  termination of this  Agreement,  Executive
shall (i) refrain from taking any such  property  from the  Company's  premises,
(ii)  immediately  return  to the  Company  any  such  property  in  Executive's
possession or control  (including any and all copies  thereof) and (iii) certify
in writing that Executive has complied with this Section 4.2.

         4.3 Assignment of Inventions to the Company.  Executive  shall promptly
disclose to the Company all improvements,  inventions, formulas, ideas, works of
authorship,  processes,  computer  programs and software,  software  designs and
documentation,  algorithms,  techniques, schematics, know-how and trade secrets,
whether or not patentable, made or conceived or reduced to practice or developed
by Executive, either alone or jointly with others, during Executive's employment
with the Company (collectively  "Inventions").  All Inventions, and all patents,
copyrights,  trade secret rights and other intellectual  property rights related
thereto (including any extensions,  renewals,  continuations or divisions of any
of the  foregoing),  shall be the sole  property  of the  Company to the maximum
extent  permitted by law and, to the extent  permitted  by law,  shall be "works
made for hire." Executive hereby assigns to the Company any rights Executive may
have or may acquire in all  Inventions  and agrees to  perform,  both during the
Term and  thereafter,  all acts  necessary or desirable by the Company to permit
and assist the Company,  at the  Company's  expense,  in obtaining and enforcing
patents,  copyrights,  trade secrets or other intellectual  property rights with
respect  to  such  Inventions  in  any  and  all  countries.   Executive  hereby
irrevocably designates and appoints the Company and its duly authorized officers
and  agents  as  Executive's  agents  and  attorneys-in-fact  to act  for and in
Executive's  name and stead,  to execute  and file any  applications  or related
filings and do all other lawfully  permitted acts to further the prosecution and
issuance or  patents,  copyrights,  trade  secret  rights or other  intellectual
property  rights with  respect to any  Inventions  with the same legal force and
effect as if executed by Executive. The foregoing  notwithstanding,  the Company
acknowledges  and agrees that the Company  will not own,  and  Executive  is not
obligated to disclose or assign to the Company, any of Executive's rights in any
invention that Executive develops entirely on Executive's own time without using
the Company's equipment, supplies, facilities, or Proprietary Information except
for those inventions that either (i) relate either (a) at the time of conception
or (b) at the time of reduction to practice to the Company's  business or actual
or  demonstrably  anticipated  research or development  of the Company,  or (ii)
result from any work performed by Executive for the Company.

--------------------------------------------------------------------------------
Exhibit "D": Share Exchange Agreement - CTC                              Page 61
& Shareholders of EU Energy plc
<PAGE>

         4.4  Non-Solicitation of Employees and Others.  During the Term and for
two years thereafter,  Executive shall not directly or indirectly (i) encourage,
solicit, induce, or attempt to encourage,  solicit or induce any employee, agent
or  representative  of the Company to leave his/her  employment with,  terminate
his/her  relationship  with or  devote  less of  his/her  time on  behalf of the
Company , or (ii) hire or attempt to hire any person who is an  employee,  agent
or  representative  of the  Company  at such time or was an  employee,  agent or
representative of the Company at any time within 180 days preceding such time.

         4.5 Non-Solicitation of Customers and Clients.  During the Term and for
two years  thereafter,  Executive  shall not directly or indirectly on behalf of
any person or entity competitive with the Company solicit,  divert or attempt to
solicit or divert any actual or identified prospective customer or client of the
Company at the time of such solicitation, diversion or attempted solicitation or
diversion or within one year preceding  such time.  Executive  acknowledges  and
agrees  that  actual and  identified  prospective  customers  and clients of the
Company  constitute  protectable  trade  secrets as defined  and  covered by the
Uniform Trade Secrets Act (California Civil Code ss. 3426, et seq).

         4.6  Non-Interference.  During  the Term and for two years  thereafter,
Executive shall not directly or indirectly hire, engage, sell any work to, place
orders  with,  or in any manner be  associated  with any  supplier,  contractor,
subcontractor  or other  business  relation of the Company during such period if
such action by Executive  would have a material  adverse effect on the business,
assets or financial condition of the Company,  or materially  interfere with the
relationship between any such person or entity and the Company.

         4.7  Covenant  Not to  Compete  during  Employment.  During  the  Term,
Executive shall not directly or indirectly own, manage, finance,  operate, join,
control or  participate  in the  ownership,  management  or  operation  of or be
employed,  provide services to or otherwise be connected in any manner with, any
person or entity competitive with the Company.

         4.8 Competitor Defined. For the purposes of this Article 4, a person or
entity  shall be deemed to be  competitive  with the  Company if such  person or
entity conducts,  operates, carries out or otherwise engages in the development,
production,  marketing or servicing of (i) any service or product of, or similar
to that of, the Company or (ii) any service or product which, or similar to that
which, the Company is developing,  producing, marketing or servicing or plans to
develop, produce, market or service, provided that Executive was involved in any
manner or gained any knowledge  regarding  such product or service in the course
of Executive's employment with the Company.

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Exhibit "D": Share Exchange Agreement - CTC                              Page 62
& Shareholders of EU Energy plc
<PAGE>

         4.9  Certain  Representations  of  Executive.  In  connection  with the
provisions of Sections 4.4, 4.5,  4.6, 4.7 and 4.8,  Executive  represents  that
Executive's  experience,  capabilities  and  circumstances  are such  that  such
provisions  will not prevent him from earning a  livelihood.  Executive  further
agrees  that the  limitations  set forth in such  sections  are  reasonable  and
properly required for the adequate protection of the current and future business
of the Company.

         4.10 Injunctive Relief. Executive acknowledges and agrees that a remedy
at law for any breach or  threatened  breach of the  provision of this Article 4
would be inadequate and, therefore, agrees that the Company shall be entitled to
injunctive relief in addition to any other available rights and remedies in case
of any  such  breach  or  threatened  breach;  provided,  however  that  nothing
contained herein shall be construed as prohibiting the Company from pursuing any
other rights and remedies available for any such breach or threatened breach.

                                    ARTICLE 5
                            MISCELLANEOUS PROVISIONS

         5.1  Severability.   If  any  provision  of  this  Agreement,   or  the
application of such provision to any person or circumstance, shall be judicially
declared to be invalid, unenforceable,  void or voidable, such decision will not
have the effect of invalidating,  voiding or rendering voidable the remainder of
this  Agreement or affect the  application of such provision to other persons or
circumstances  or in  other  jurisdictions,  and  the  parties  agree  that  the
provision  of  this  Agreement  so held to be  invalid,  unenforceable,  void or
voidable  will be  deemed  to have  been  stricken  (except  as set forth in the
following sentence) and the remainder of this Agreement will have the same force
and effect as if such provision had never been  included.  In the event that any
provision of this Agreement,  or the application of such provision to any person
or circumstance,  is judicially declared to be invalid,  unenforceable,  void or
voidable  by  reason  of being  unreasonably  broad in  scope  or by  reason  of
extending  for an  unreasonably  long  period or time,  then such  provision  or
application  shall be  reduced  and  reformed  by such  court to a scope or time
period which such court shall deem reasonable.

         5.2 Successors and Assigns.  Except as otherwise  provided herein,  the
terms and  conditions  of this  Agreement  shall  inure to the benefit or and be
binding upon the  respective  successors  and permitted  assigns of the parties.
Nothing in this  Agreement,  express or implied,  is intended to confer upon any
party other than the parties hereto or their  respective  successors and assigns
any rights,  remedies,  obligations,  or liabilities  under or by reason of this
Agreement, except as expressly provided in this Agreement.

         5.3 Notices.  Any notice under this  Agreement  shall be in writing and
shall be deemed to have been  duly  given (i) on the date of  personal  service,
(ii) on the third  business  day after  mailing,  if the  document  is mailed by
registered  mail,  (iii) one day after being sent by  professional  or overnight
courier  or  messenger  service  guaranteeing  one-day  delivery,  with  receipt
confirmed  by the  courier,  or (iv)  on the  date  of  transmission  if sent by
telecopy or other means of electronic transmission,  with receipt confirmed. Any
such notice  shall be delivered or addressed to the address set forth below such
party's  signature to this Agreement or at the most recent address  specified by
the addressee through written notice under this provision. Failure to conform to
the  requirements of this Section shall not defeat the  effectiveness  of notice
actually received by the addressee. Notices shall be delivered as follows:

--------------------------------------------------------------------------------
Exhibit "D": Share Exchange Agreement - CTC                              Page 63
& Shareholders of EU Energy plc
<PAGE>

                  If to the Company:        Composite Technology Corporation
                                            2026 McGaw Avenue
                                            Irvine, CA 92614
                                            Attn: Benton Wilcoxon, CEO

                  If to Executive:          Michael Porter
                                            Westbury House
                                            Windsor, Ovens
                                            County Cork
                                            Ireland

or to such other address as a party shall have  specified  most recently by like
Notice.

         5.4 Governing Law. This Agreement shall be governed by and construed in
accordance with the laws of the State of California without giving effect to the
conflicts of law provisions thereof.

         5.5 Entire  Agreement  and  Amendment.  This  Agreement,  including any
exhibits attached hereto: (1) is the final,  complete and exclusive statement of
the  agreement  of the parties with respect to the subject  matter  hereof;  (2)
supersedes  any  prior  or  contemporaneous  agreements,  promises,  assurances,
guarantees,  representations,  understandings,  conduct, proposals,  conditions,
commitments,  acts, course of dealing,  warranties,  interpretations or terms of
any kind, oral or written,  including but not limited to, the Services Agreement
between EU Energy plc (which  Executive and the Company  acknowledge is a wholly
owned  subsidiary of the Company as of the effective date of this Agreement) and
Executive  dated  December 13, 2004 and the  Contract  for  Services  between EU
Energy plc and Laikadog Holdings Limited (which Executive  represents,  warrants
and acknowledges he is the controlling shareholder) (collectively and severally,
the "Prior  Agreements"),  and that any such Prior Agreements are of no force or
effect  except as  expressly  set forth  herein  other  than the Share  Exchange
Agreement by and among the Company and the  shareholders  of EU Energy plc dated
June 2,  2006  which  shall  remain  in  effect,  and  (3)  may  not be  varied,
supplemented or contradicted by evidence of Prior Agreements,  or by evidence of
subsequent oral agreements.  Executive's obligations under this Agreement may be
amended, supplemented, modified and/or rescinded only through an express written
instrument executed by the Chief Executive Officer of the Company. The Company's
obligations under this Agreement may be amended,  supplemented,  modified and/or
rescinded only through an express written instrument executed by the Executive.

         5.6  Counterparts.  This  Agreement  may be  executed  in  one or  more
counterparts,  each of  which  shall be  deemed  an  original,  but all of which
together shall constitute a single agreement.

--------------------------------------------------------------------------------
Exhibit "D": Share Exchange Agreement - CTC                              Page 64
& Shareholders of EU Energy plc
<PAGE>

         5.7 Arbitration.  To the fullest extent allowed by law, any controversy
or claim arising out of or relating to this  Agreement,  Executive's  employment
with the Company,  or termination of the Agreement or such employment,  shall be
settled by binding and non-appealable  arbitration by a single arbitrator in the
County of Orange in the State of California.  Possible  disputes  covered by the
foregoing, include, but are not limited to, wage, contract,  discrimination,  or
other  employment-related  claims  under  laws  known as Title  VII of the Civil
Rights Act,  Americans with Disabilities  Act, Age  Discrimination in Employment
Act,  and any  other  federal,  state or local  statutes,  rules or  regulations
relating to an employee's  relationship with his/her employer.  However,  claims
for workers' compensation benefits and unemployment insurance are not covered by
this  arbitration  provision and such claims may be presented to the appropriate
court or state  agency.  If there is a controversy  or claim,  Executive and the
Company  shall  initially  confer and attempt to agree on the  individual  to be
appointed  as the  arbitrator.  If no agreement  is reached,  the parties  shall
request from the Judicial  Arbitration and Mediation Services ("JAMS") office in
Orange,  California,  a list  of  five  retired  judges  affiliated  with  JAMS.
Executive  and the Company  shall each  alternately  strike names from such list
until only one name  remains  and such person  shall  thereby be selected as the
arbitrator. The arbitration shall be conducted in conformity with the applicable
California  arbitration  laws and, to the extent that anything in this Agreement
conflicts  with such  laws,  the  provisions  of such  laws  shall  govern.  The
arbitrator shall (i) allow the discovery  authorized by such laws in arbitration
proceedings  (ii) issue a written award that sets forth the  essential  findings
and  conclusions  on which the award is based,  and (iii) have the  authority to
award any relief  authorized  by law in connection  with the asserted  claims or
disputes.  The arbitrator's award shall be subject to correction,  confirmation,
or vacation,  as provided by the  applicable  law setting  forth the standard of
judicial review of arbitration  awards. Any final decision of the arbitrator may
be enforced by a court of competent jurisdiction.  The Company agrees to pay for
(1) the  arbitrator's fee (2) any other expense or cost that the Executive would
not be required to bear if Executive  were free to bring the dispute or claim in
court,  and (3) any other  expense  or cost that is  unique to  arbitration.  If
either party is determined by the arbitrator to be the  prevailing  party in the
arbitration,  then that party will be entitled to  reimbursement  from the other
party of all the  reasonable  fees  (including  attorneys'  fees)  and  expenses
incurred in  connection  with such  arbitration.  The  parties  intend that this
Section 5.7 shall be valid,  binding,  enforceable  and  irrevocable.  Executive
acknowledges  that  Executive is waiving  Executive's  right to a jury trial and
agrees that the decision of the arbitrator shall be final and binding.

         5.8  Survival.  It is  understood  and agreed  that the  provisions  of
Article 4 and this Article 5 shall survive the expiration of this Agreement.

         5.9  Preparation of Agreement.  It is  acknowledged  by each party that
such  party  either  had  separate  and  independent  advice of  counsel  or the
opportunity  to avail  itself or himself of same.  In light of these facts it is
acknowledged  that no party shall be construed to be solely  responsible for the
drafting hereof,  and therefore any ambiguity shall not be construed against any
party as the alleged draftsman of this Agreement.

         5.10 Cooperation. Each party agrees, without further consideration,  to
cooperate  and  diligently  perform  any further  acts,  deeds and things and to
execute  and  deliver  any  documents  that may from time to time be  reasonably
necessary or otherwise  reasonably  required to  consummate,  evidence,  confirm
and/or carry out the intent and provisions of this Agreement,  all without undue
delay or expense.

--------------------------------------------------------------------------------
Exhibit "D": Share Exchange Agreement - CTC                              Page 65
& Shareholders of EU Energy plc
<PAGE>

         5.11 Waiver.  No breach of any agreement or provision herein contained,
or of any  obligation  under  this  Agreement,  may be  waived,  nor  shall  any
extension  of time for  performance  of any  obligations  or acts be  deemed  an
extension of time for  performance  of any other  obligations  or acts contained
herein,  except by  written  instrument  signed by the party to be charged or as
otherwise expressly  authorized herein. No waiver of any breach of any agreement
or  provision  herein  contained  shall be deemed a waiver of any  preceding  or
succeeding breach thereof,  or a waiver or relinquishment of any other agreement
or provision or right or power herein contained.

         5.12 Headings; References;  Incorporation; Gender. The headings used in
this Agreement are for convenience and reference purposes only, and shall not be
used in construing or interpreting  the scope or intent of this Agreement or any
provision  hereof.  References to this Agreement shall include all amendments or
renewals thereof. Any exhibit referenced in this Agreement shall be construed to
be incorporated in this Agreement. As used in this Agreement,  each gender shall
be deemed to include  the other  gender,  including  neutral  genders or genders
appropriate  for entities,  if  applicable,  and the singular shall be deemed to
include the plural, and vice versa, as the context requires.

         5.13  Execution by All Parties  Required to be Binding;  Electronically
Transmitted Documents.  This Agreement shall not be construed to be an offer and
shall have no force and effect  until this  Agreement  is fully  executed by all
parties  hereto.  If a copy or  counterpart  of  this  Agreement  is  originally
executed and such copy or counterpart is thereafter  transmitted  electronically
by facsimile or similar device,  such facsimile  document shall for all purposes
be treated as if manually signed by the party whose facsimile signature appears.

          IN WITNESS WHEREOF, the parties have executed this Agreement.

                                    Company:
                                    Composite Technology Corporation

                                    By:
                                       ------------------------------------
                                       Benton H Wilcoxon, CEO and Chairman

                                    Executive:

                                    ---------------------------------------
                                    Michael Porter

--------------------------------------------------------------------------------
Exhibit "D": Share Exchange Agreement - CTC                              Page 66
& Shareholders of EU Energy plc
<PAGE>

                                   SCHEDULE A

                            SHAREHOLDERS OF EU ENERGY

<TABLE>
<CAPTION>
------------------------------------------- --------------------------------------------------- ---------------------
Name                                        Address                                             Number of Shares
------------------------------------------- --------------------------------------------------- ---------------------
<S>                                         <C>                                                 <C>
A.C. Directors, Ltd. * 0
------------------------------------------- --------------------------------------------------- ---------------------
A.C. Secretaries Limited * 0
------------------------------------------- --------------------------------------------------- ---------------------
Michele Allahiary                           *                                                                 47,619
------------------------------------------- --------------------------------------------------- ---------------------
Alternative Products Limited                *                                                                100,000
------------------------------------------- --------------------------------------------------- ---------------------
Elio Auletta                                *                                                                238,096
------------------------------------------- --------------------------------------------------- ---------------------
Marcello Auletta                            *                                                                238,096
------------------------------------------- --------------------------------------------------- ---------------------
Batt, Wayne & Susan                         *                                                                 10,000
------------------------------------------- --------------------------------------------------- ---------------------
Stephen Francis Bircher                     *                                                              7,718,503
------------------------------------------- --------------------------------------------------- ---------------------
Blossomville Ventures Corporation           *                                                                 96,774
------------------------------------------- --------------------------------------------------- ---------------------
Hazel Chalkey                               *                                                                120,556
------------------------------------------- --------------------------------------------------- ---------------------
Ann Coletta                                 *                                                                 24,000
------------------------------------------- --------------------------------------------------- ---------------------
Colpro Holdings Limited                     *                                                              1,225,968
------------------------------------------- --------------------------------------------------- ---------------------
Les Cowel                                   *                                                                375,000
------------------------------------------- --------------------------------------------------- ---------------------
Timothy Dill-Russell                        *                                                                 24,000
------------------------------------------- --------------------------------------------------- ---------------------
Lisa Ferguson                               *                                                                 15,000
------------------------------------------- --------------------------------------------------- ---------------------
Jeanette Elisabeth Margaret Fickert         *                                                                 20,000
------------------------------------------- --------------------------------------------------- ---------------------
Vicki Michelle Fowler                       *                                                                 41,447
------------------------------------------- --------------------------------------------------- ---------------------
Garrick Enterprises Limited                 *                                                                 83,333
------------------------------------------- --------------------------------------------------- ---------------------
Rahul Hegde                                 *                                                                 48,000
------------------------------------------- --------------------------------------------------- ---------------------
Inge, David Stanley & Lynn Cecila           *                                                                 10,000
------------------------------------------- --------------------------------------------------- ---------------------
Stuart Jackson                              *                                                                 55,000
------------------------------------------- --------------------------------------------------- ---------------------
Baiju Jadav                                 *                                                                 24,000
------------------------------------------- --------------------------------------------------- ---------------------
Monik Jadav                                 *                                                                 12,000
------------------------------------------- --------------------------------------------------- ---------------------
</TABLE>

[*]  Confidential  information  has been omitted and  separately  filed with the
Securities and Exchange  Commission.  Confidential  treatment has been requested
with respect to the omitted portions.

--------------------------------------------------------------------------------
Schedule "A": Share Exchange Agreement - CTC                             Page 67
& Shareholders of EU Energy plc
<PAGE>

<TABLE>
<CAPTION>
<S>                                         <C>                                                 <C>
------------------------------------------- --------------------------------------------------- ---------------------
James McDonald Holdings S.A.                *                                                                 10,000
------------------------------------------- --------------------------------------------------- ---------------------
Keeley Services Limited                     *                                                              2,500,000
------------------------------------------- --------------------------------------------------- ---------------------
Amanda Knight-Surie                         *                                                                 23,809
------------------------------------------- --------------------------------------------------- ---------------------
Nuria Koorehpaz                             *                                                                 24,000
------------------------------------------- --------------------------------------------------- ---------------------
Matthias Krebs                              *                                                                 35,000
------------------------------------------- --------------------------------------------------- ---------------------
Jorg Kubitza                                *                                                                 85,000
------------------------------------------- --------------------------------------------------- ---------------------
Kuldip Kudhail                              *                                                                 60,278
------------------------------------------- --------------------------------------------------- ---------------------
Laikadog Holdings Limited                   *                                                              2,327,754
------------------------------------------- --------------------------------------------------- ---------------------
Lee-Bolton, Richard James & Judy Elizabeth  *                                                                 50,000
------------------------------------------- --------------------------------------------------- ---------------------
Victor Lilly                                *                                                                 50,000
------------------------------------------- --------------------------------------------------- ---------------------
Andrew Lockhart                             *                                                                371,569
------------------------------------------- --------------------------------------------------- ---------------------
Valerie Mayo                                *                                                                107,143
------------------------------------------- --------------------------------------------------- ---------------------
James McGowan                               *                                                                 20,000
------------------------------------------- --------------------------------------------------- ---------------------
Miele-Tec Limited                           *                                                                 24,000
------------------------------------------- --------------------------------------------------- ---------------------
Kamran Naseem                               *                                                                 36,000
------------------------------------------- --------------------------------------------------- ---------------------
Nichols, Peter & Kathryn                    *                                                                 25,000
------------------------------------------- --------------------------------------------------- ---------------------
Jane Patricia Nolder                        *                                                                 23,810
------------------------------------------- --------------------------------------------------- ---------------------
Hugh Robert Parnell                         *                                                                100,000
------------------------------------------- --------------------------------------------------- ---------------------
John William Patching                       *                                                                 23,809
------------------------------------------- --------------------------------------------------- ---------------------
Layla Porter                                *                                                                 35,000
------------------------------------------- --------------------------------------------------- ---------------------
Michael Porter                              *                                                                      0
------------------------------------------- --------------------------------------------------- ---------------------
Alan Geoffrey Rainer                        *                                                              1,696,658
------------------------------------------- --------------------------------------------------- ---------------------
Hitesh Rathod                               *                                                                 12,000
------------------------------------------- --------------------------------------------------- ---------------------
Rayna Limited                               *                                                              3,000,000
------------------------------------------- --------------------------------------------------- ---------------------
Robert Anthony & Enid Rosemary Banbery      *                                                                 10,000
------------------------------------------- --------------------------------------------------- ---------------------
Chris Rodbourne                             *                                                                  7,601
------------------------------------------- --------------------------------------------------- ---------------------
</TABLE>

[*]  Confidential  information  has been omitted and  separately  filed with the
Securities and Exchange  Commission.  Confidential  treatment has been requested
with respect to the omitted portions.

--------------------------------------------------------------------------------
Schedule "A": Share Exchange Agreement - CTC                             Page 68
& Shareholders of EU Energy plc
<PAGE>

<TABLE>
<CAPTION>
<S>                                         <C>                                                 <C>
------------------------------------------- --------------------------------------------------- ---------------------
David Rowden                                *                                                                362,653
------------------------------------------- --------------------------------------------------- ---------------------
Saeid Sadeghi                               *                                                                 60,000
------------------------------------------- --------------------------------------------------- ---------------------
Pradeep Sharma                              *                                                                207,504
------------------------------------------- --------------------------------------------------- ---------------------
Andrew Sharratt                             *                                                                  7,320
------------------------------------------- --------------------------------------------------- ---------------------
Stephen Cameron Smith                       *                                                                 30,000
------------------------------------------- --------------------------------------------------- ---------------------
Walter William Smith                        *                                                                 35,714
------------------------------------------- --------------------------------------------------- ---------------------
Michael Spencer                             *                                                                135,096
------------------------------------------- --------------------------------------------------- ---------------------
David John Still                            *                                                                 25,000
------------------------------------------- --------------------------------------------------- ---------------------
The Baron Homes Corporation Limited         *                                                                 25,000
------------------------------------------- --------------------------------------------------- ---------------------
Farzin Vakili                               *                                                                 24,000
------------------------------------------- --------------------------------------------------- ---------------------
Robert Vinsen                               *                                                                 20,000
------------------------------------------- --------------------------------------------------- ---------------------
Siegfried Vullriede                         *                                                                 35,000
------------------------------------------- --------------------------------------------------- ---------------------
Wellsford Management Limited                *                                                              3,750,000
------------------------------------------- --------------------------------------------------- ---------------------
Ian Zant-Boer                               *                                                                210,000
------------------------------------------- --------------------------------------------------- ---------------------
                                                                                                          26,113,110
                                                                                                ---------------------
</TABLE>

[*]  Confidential  information  has been omitted and  separately  filed with the
Securities and Exchange  Commission.  Confidential  treatment has been requested
with respect to the omitted portions.

--------------------------------------------------------------------------------
Schedule "A": Share Exchange Agreement - CTC                             Page 69
& Shareholders of EU Energy plc
<PAGE>

                                   SCHEDULE B

             EUE SHAREHOLDERS EXECUTING THE SHARE EXCHANGE AGREEMENT

<TABLE>
<CAPTION>
------------------------------------------- --------------------------------------------------- ---------------------
Name                                        Address                                             Number of Shares
------------------------------------------- --------------------------------------------------- ---------------------
<S>                                         <C>                                                 <C>
A.C. Directors, Ltd.                        *
------------------------------------------- --------------------------------------------------- ---------------------
A.C. Secretaries Limited                    *
------------------------------------------- --------------------------------------------------- ---------------------
Michele Allahiary                           *                                                                 47,619
------------------------------------------- --------------------------------------------------- ---------------------
Alternative Products Limited                *                                                                100,000
------------------------------------------- --------------------------------------------------- ---------------------
Marcello Auletta                            *                                                                238,096
------------------------------------------- --------------------------------------------------- ---------------------
Stephen Francis Bircher                     *                                                              7,718,503
------------------------------------------- --------------------------------------------------- ---------------------
Hazel Chalkey                               *                                                                120,556
------------------------------------------- --------------------------------------------------- ---------------------
Ann Coletta                                 *                                                                 24,000
------------------------------------------- --------------------------------------------------- ---------------------
Colpro Holdings Limited                     *                                                              1,225,968
------------------------------------------- --------------------------------------------------- ---------------------
Les Cowel                                   *                                                                375,000
------------------------------------------- --------------------------------------------------- ---------------------
Lisa Ferguson                               *                                                                 15,000
------------------------------------------- --------------------------------------------------- ---------------------
Rahul Hegde                                 *                                                                 48,000
------------------------------------------- --------------------------------------------------- ---------------------
Inge, David Stanley & Lynn Cecila           *                                                                 10,000
------------------------------------------- --------------------------------------------------- ---------------------
Stuart Jackson                              *                                                                 55,000
------------------------------------------- --------------------------------------------------- ---------------------
Baiju Jadav                                 *                                                                 24,000
------------------------------------------- --------------------------------------------------- ---------------------
Monik Jadav                                 *                                                                 12,000
------------------------------------------- --------------------------------------------------- ---------------------
Keeley Services Limited                     *                                                              2,500,000
------------------------------------------- --------------------------------------------------- ---------------------
Matthias Krebs                              *                                                                 35,000
------------------------------------------- --------------------------------------------------- ---------------------
Jorg Kubitza                                *                                                                 85,000
------------------------------------------- --------------------------------------------------- ---------------------
Kuldip Kudhail                              *                                                                 60,278
------------------------------------------- --------------------------------------------------- ---------------------
Laikadog Holdings Limited                   *                                                              2,327,754
------------------------------------------- --------------------------------------------------- ---------------------
Victor Lilly                                *                                                                 50,000
------------------------------------------- --------------------------------------------------- ---------------------
Andrew Lockhart                             *                                                                371,569
------------------------------------------- --------------------------------------------------- ---------------------
Valerie Mayo                                *                                                                107,143
------------------------------------------- --------------------------------------------------- ---------------------
</TABLE>

[*]  Confidential  information  has been omitted and  separately  filed with the
Securities and Exchange  Commission.  Confidential  treatment has been requested
with respect to the omitted portions.

--------------------------------------------------------------------------------
Schedule "B": Share Exchange Agreement - CTC                             Page 70
& Shareholders of EU Energy plc
<PAGE>

<TABLE>
<CAPTION>
<S>                                         <C>                                                 <C>
------------------------------------------- --------------------------------------------------- ---------------------
James McGowan                               *                                                                 20,000
------------------------------------------- --------------------------------------------------- ---------------------
Miele-Tec Limited                           *                                                                 24,000
------------------------------------------- --------------------------------------------------- ---------------------
Kamran Naseem                               *                                                                 36,000
------------------------------------------- --------------------------------------------------- ---------------------
Nichols, Peter & Kathryn                    *                                                                 25,000
------------------------------------------- --------------------------------------------------- ---------------------
Hugh Robert Parnell                         *                                                                100,000
------------------------------------------- --------------------------------------------------- ---------------------
Layla Porter                                *                                                                 35,000
------------------------------------------- --------------------------------------------------- ---------------------
Michael Porter                              *                                                                      0
------------------------------------------- --------------------------------------------------- ---------------------
Alan Geoffrey Rainer                        *                                                              1,696,658
------------------------------------------- --------------------------------------------------- ---------------------
Rayna Limited                               *                                                              3,000,000
------------------------------------------- --------------------------------------------------- ---------------------
David Rowden                                *                                                                362,653
------------------------------------------- --------------------------------------------------- ---------------------
Saeid Sadeghi                               *                                                                 60,000
------------------------------------------- --------------------------------------------------- ---------------------
Pradeep Sharma                              *                                                                207,504
------------------------------------------- --------------------------------------------------- ---------------------
Stephen Cameron Smith                       *                                                                 30,000
------------------------------------------- --------------------------------------------------- ---------------------
Walter William Smith                        *                                                                 35,714
------------------------------------------- --------------------------------------------------- ---------------------
Michael Spencer                             *                                                                135,096
------------------------------------------- --------------------------------------------------- ---------------------
David John Still                            *                                                                 25,000
------------------------------------------- --------------------------------------------------- ---------------------
The Baron Homes Corporation Limited         *                                                                 25,000
------------------------------------------- --------------------------------------------------- ---------------------
Siegfried Vullriede                         *                                                                 35,000
------------------------------------------- --------------------------------------------------- ---------------------
Wellsford Management Limited                *                                                              3,750,000
------------------------------------------- --------------------------------------------------- ---------------------
Ian Zant-Boer                               *                                                                210,000
</TABLE>

[*]  Confidential  information  has been omitted and  separately  filed with the
Securities and Exchange  Commission.  Confidential  treatment has been requested
with respect to the omitted portions.

--------------------------------------------------------------------------------
Schedule "B": Share Exchange Agreement - CTC                             Page 71
& Shareholders of EU Energy plc
<PAGE>

                     LIST OF ADDITIONAL SCHEDULE DISCLOSURES

Schedule 3.2(e)   -- Resigning Officers and Directors

Schedule 5.2      -- Jurisdictions where EU Companies have permanent business
                     establishments

Schedule 5.4      -- Equity Ownership Table for each EU Company (other than EU
                     Energy plc)

Schedule 5.5      -- List of Subsidiaries

Schedule 5.7      -- Related Party Transactions.

Schedule 5.8(b)   -- Real property leases

Schedule 5.9(a)   -- Equipment leases

Schedule 5.10     -- Permits

Schedule 5.11     -- Material Contracts

Schedule 5.12     -- Registered Intellectual Property (patents, trademarks, and
                     copyrights)

Schedule 5.12(f)  -- Intellectual Property Contracts and Licenses

Schedule 5.12(i)  -- Required actions within 180 days of the Agreement signing

Schedule 5.15(a)  -- Audited Financial Statements for year ended March 31, 2006

Schedule 5.21     -- Warranty Claims asserted during the last three years

Schedule 5.22(a)  -- Employee Information

Schedule 5.23     -- Employee Benefit Plans (i.e., pension plans, etc.)

Schedule 5.24     -- Environmental Authorizations

Schedule 5.25     -- Customers, Suppliers

Schedule 5.26     -- Banks or financial institution used by any EUE Company

Schedule 5.27     -- Insurance Policies

--------------------------------------------------------------------------------
Other Schedules: Share Exchange Agreement - CTC                          Page 72
& Shareholders of EU Energy plcComposite
Technology
Corporation                          Innovative Solutions for the Power Industry
--------------------------------------------------------------------------------

FOR IMMEDIATE RELEASE

          COMPOSITE TECHNOLOGY SIGNS AGREEMENT TO ACQUIRE EU ENERGY PLC
              SECURING RIGHT TO ACQUIRE THE DEWIND TURBINE BUSINESS

IRVINE, CA - June 5, 2006 - Composite Technology Corporation (CTC) (OTC Bulletin
Board:  CPTC) is  pleased  to  announce  the  execution  of the  Share  Exchange
Agreement with  shareholders  of EU Energy plc  representing at least 95% of the
issued and  outstanding  shares of EU Energy plc (EU  Energy),  which allows the
acquisition  of 100% of EU  Energy.  EU  Energy  owns  100%  of the  issued  and
outstanding  capital  stock of a group of  companies  which  own the  rights  to
produce and sell worldwide the DeWind range of wind energy generation turbines.

Under the terms of the Share Exchange  Agreement,  subject to customary  closing
conditions,  the EU Energy shareholders  executing such agreement have agreed to
transfer  all of their shares in EU Energy to CTC,  and,  following a special EU
Energy  Shareholders'  Meeting on the 14th of June and a closing  scheduled  for
July 3, 2006,  CTC expects to receive 100% of the  ownership of EU Energy,  with
any dissenting  shareholders  transferring  their shares in accordance  with the
terms of certain "drag along" rights. The entire share capital of EU Energy will
be transferred to CTC in exchange for  39,169,665  shares of CTC's  unregistered
common  stock.  The  shares  of  CTC  common  stock  issued  to the  five  major
shareholders  and  representing  73.89%  of  the  total  EU  Energy  issued  and
outstanding  shares will be subject to a lock-up agreement with  indemnification
obligations,  in an "EU Energy Principals'  Agreement".  Mr. Michael Porter, the
CEO of EU Energy,  will be  appointed as the  President of CTC while Mr.  Benton
Wilcoxon will remain as Chief Executive  Officer of CTC following  completion of
the acquisition.

The pricing of the transaction  was established  based on the CTC share price at
the close on May 11, 2006 and each selling  shareholder  will receive  three (3)
CTC shares of common stock for every two (2) shares of EU Energy. This fixes the
value of EU Energy at approximately $60.7 million.

Through  various  frame  agreements  for the new 2 megawatt  (MW) D8.2 60Hz wind
energy  turbines,  EU Energy  customers  have agreed to purchase  2,526MW (1,263
turbines)  for delivery in 2007-2012,  including  certain  customers  which have
signed  turbine  purchase  agreements  for 286MW (142  turbines) for delivery in
2007. These frame agreements represent anticipated revenue of approximately $2.8
billion for EU Energy.  Supply  agreements with vendors of the major  components
for the D8.2 turbines are in place for 2007  production  commitments.  EU Energy
plans to assemble and deliver two 50Hz D8.1  turbines  during 2006.  The initial
production  for the 60Hz D8.2 turbines for delivery in 2007 will be assembled in
Lubeck,  Germany,  until  a  planned  assembly  facility  in  North  America  is
completed.

Additionally,  EU Energy has entered into non-exclusive  license agreements with
two  companies to produce and sell the  existing  1.25MW D6 turbine in China and
another  non-exclusive license agreement with another Chinese company to produce
and sell the existing 2MW D8 turbine  there as well. EU Energy has also signed a
Letter of Intent for an Indian joint venture to produce the D6 turbine in India.

The Share  Exchange  Agreement  will be filed under Form 8-K with the Securities
and Exchange Commission (SEC) within the next three business days.

2026 McGaw Avenue, Irvine, California 92614                    Tel: 949.428.8500
Fax: 949.660.1533                                      www.compositetechcorp.com

<PAGE>

Benton H Wilcoxon, CEO of CTC and Michael Porter, CEO of EU Energy have released
the  following  joint  statement:  "CTC and the EU Energy team have been working
together  for two  years  to  identify  and  secure  excellence  in  wind  power
technologies that will accelerate the implementation of wind power generation as
an  economically  viable  reality for renewable  energy.  We believe that DeWind
turbines and CTC  conductors,  each address urgent issues facing  congested grid
systems as well as the need for reliable  renewable energy,  while  contributing
significantly  to efforts to make the electrical  supply industry  greener,  and
more efficient.  We look forward to making our vision a real alternative for the
industry." Mr. Wilcoxon  further  stated,  "The DeWind product line combines the
best of the  tradition of German  engineering  and  reliability  with  important
innovations  that is  designed  to set the  next  benchmark  in wind  generation
performance and economics."

EU  Energy/DeWind  has two existing  turbine models rated at 1.25MW and 2MW. The
flagship  2MW D8 turbine was  introduced  in Europe in 2002 and with its gearbox
that has had a zero-failure  rating over the past five years,  it has been noted
as one of the most  reliable  turbines in the industry.  The next  generation of
turbines  to be  introduced  next year,  known as the D8.2 and D8.1,  are in the
final  stages  of  development   and  will   integrate  the  advanced   WinDrive
hydrodynamic  torque converter developed by Voith. The new torque converter will
be directly  attached to DeWind's proven drive train and control system and will
use a synchronous AC generator that connects  directly to the power grid without
the use of power conversion  electronics.  This novel arrangement will eliminate
many of the traditional  problems  associated with  integrating wind energy into
the modern grid.  These enhanced  versions will be sold as the D8.2 in the U.S.,
Canada and other 60Hz markets and the D8.1 worldwide in 50Hz markets.

ABOUT CTC:

Composite  Technology  Corporation,  based  in  Irvine,  California,   develops,
manufactures  and sells novel  products that  introduce  the  advantages of high
performance   composite  materials  to  create  superior  applications  for  the
generation,  transmission  and  distribution of electrical  power. The company's
novel  and  proprietary  Aluminum  Composite  Core  Conductor  (ACCC)  is a cost
effective  solution  for the  introduction  of reserve  electrical  transmission
capacity into a saturated electrical grid, while reducing operating costs and in
many cases capital costs. The elimination of significant sag at higher operating
temperatures allows users of ACCC to reduce transmission bottlenecks, span large
distances,  reduce supporting  structures and improve grid reliability.  ACCC is
superior  to  conventional  conductors  of  the  same  diameter  in  many  ways,
including:

o     Replaces  existing steel core conductors and increases  energy capacity up
      to 2 times

o     Virtually eliminates sag caused by high load, high-temperature conditions

o     Requires fewer structures along new Rights of Way,  reducing  construction
      costs and time

o     Reduces line losses  compared  with same diameter  conventional  cables at
      same operating temperatures

o     Eliminates any bi-metallic corrosion issues

For further information visit our website at: http://www.compositetechcorp.com

For Investor Relations Contact: James Carswell, (949) 428 8500

For Media Relations Contact: Kevin C. Coates (949) 428-8500

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Composite Technology Corporation Press release                       Page 2 of 3

<PAGE>

This press  release may contain  forward-looking  statements,  as defined in the
Securities  Reform  Act  of  1995  (the  "Reform  Act").  The  safe  harbor  for
forward-looking  statements  provided  to  companies  by the Reform Act does not
apply to Composite Technology Corporation (Company).  However,  actual events or
results may differ  from the  Company's  expectations  on a negative or positive
basis and are subject to a number of known and unknown  risks and  uncertainties
including, but not limited to, competition with larger companies, development of
and demand for a new technology,  risks associated with a startup company, risks
associated  with  international   transactions,   general  economic  conditions,
availability  of funds for capital  expenditure  by customers,  availability  of
timely  financing,  cash flow,  timely  delivery by suppliers,  or the Company's
ability to manage growth. In addition,  the closing of the EU Energy acquisition
is subject to the satisfaction of a number of customary closing  conditions.  If
these conditions are not satisfied, the acquisition may not be completed.  Also,
the achievement of the benefits of the EU Energy acquisition is subject to risks
associated  with  acquisitions  generally  such as the potential for higher than
anticipated integration costs, failure to achieve anticipated synergies, failure
to retain key employees, the loss of customers, and failure to execute on the EU
Energy business plan. Other risk factors  attributable to the Company's business
segment may affect the actual  results  achieved by the Company and are included
in the  Company's  Annual Report filed with the SEC on Form 10-K for fiscal year
ended  September  30,  2005 and  subsequent  Quarterly  Reports on Form 10-Q and
subsequent Current Reports filed on Form 8-K.

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Composite Technology Corporation Press release                       Page 3 of 3

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