Document:

EXHIBIT 10.4

                                    AGREEMENT

                                     BETWEEN

                   PAKISTAN TELECOMMUNICATION COMPANY LIMITED

                                       AND

             M/S FUSION TELECOMMUNICATIONS INTERNATIONAL, INC., USA
                                       FOR

                               THE TERMINATION OF

                 ADDITIONAL INTERNATIONAL INCOMING VOICE TRAFFIC

                                FROM USA & EUROPE

                TO PAKISTAN THROUGH VOICE OVER INTERNET PROTOCOL

                                     (VoIP)

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PAKISTAN

                                Table of Contents

1.  DEFINITIONS .............................................................  2

2.  THE AGREEMENT DOCUMENTS .................................................  4

3.  ENTIRE AGREEMENT ........................................................  4

4.  DURATION OF AGREEMENT ...................................................  5

5.  SERVICE COMMENCEMENT DATE ...............................................  5

6.  OBLIGATIONS OF THE CONTRACTOR ...........................................  5

7.  APPROVAL OF EQUIPMENT ................................................... 10

9.  TECHNICAL ARRANGEMENTS WITH PTCL NETWORK ................................ 10

10.   REPORTING OBLIGATIONS OF CONTRACTOR ................................... 11

14.   CURRENCY OF PAYMENT ................................................... 16

15.   SUBCONTRACTORS ........................................................ 16

16.     REVIEW .............................................................. 16

17.   FORCE MAJEURE ......................................................... 17

18.   TERMINATION ........................................................... 18

19.   OBLIGATION AT TERMINATION ............................................. 21

20.   CONTRACTOR TO COMPLY WITH APPLICABLE LAW .............................. 21

21.   FAIRNESS AND GOOD FAITH ............................................... 22

22.   SETTLEMENT OF DISPUTES & ARBITRATION .................................. 23

23.   CONFIDENTIALITY ....................................................... 23

24.   INDEMNITIES ........................................................... 24

25.   AFFIRMATION ........................................................... 24

26.   APPLICABLE LAWS ....................................................... 25

27.   RULES OF CONSTRUCTION ................................................. 25

28.   NOTICES ............................................................... 26

29.   ADDITIONAL TERMS ...................................................... 26

TOPPING UP/DOWN PROCEDURE.................................................  36

SCHEDULES
---------

Schedule-I              IP Telephony Solutions Analysis
Schedule-II             Platform Connectivity Topology Diagram
Schedule-III            Diagram of Annual International Incoming Minutes and
Schedule-IV             Accounting and Method of Settlement
Schedule-V              List of Incumbent Carriers in USA and Europe
Schedule-VI             Programme of Commitments (Milestone)

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PAKISTAN

                                    AGREEMENT
                                    ---------

This Agreement is made in duplicate and is deemed to be executed at Islamabad on
this 20 Day of May 2002.

                                     Between

Pakistan  Telecommunication  Company Ltd., a public limited company incorporated
under  the  Companies  Ordinance  1984,  with  its  registered  office  at  PTCL
headquarters,   G-8/4,  Islamabad  (hereinafter  referred  to  as  "PTCL"  which
expression  shall,  where the context so permits,  be deemed to mean and include
its   successors-in-interest   and   assigns),   through  its  duly   authorised
representative, OF THE ONE PART

                                       And

M/s Fusion Telecommunications International, Inc. USA with its registered office
at 420 Lexington  Avenue,  Suite 518, New York, New York 10170, USA (hereinafter
referred to as the  "Contractor"  which expression  shall,  where the context so
permits, be deemed to mean and include its  successors-in-interest and assigns),
through its duly authorised representative, OF THE OTHER PART

WHEREAS  PTCL has the  exclusive  right  under  the  Pakistan  Telecommunication
(Re-organisation)  Act,  1996 to provide  Basic  Telephone  Services in Pakistan
until 31 December 2002 and PTCL is not barred from executing and performing this
Agreement under the License;

AND WHEREAS PTCL proposes on non- exclusive basis to arrange for the termination
of   (illegal)   additional   incoming   international   Traffic,   focusing  on
channellising illegal traffic, from non-Incumbent Carriers through Voice over IP
(VoIP) from USA & Europe into Pakistan;

WHEREAS it is agreed that the Contractor,  in  consideration of PTCL authorising
the   Contractor   to  procure  and  install  the  VoIP  Platform  to  terminate
international  voice  traffic  at the rates and on the terms of this  Agreement,
will  procure and install at entirely its own cost and expense for and on behalf
of PTCL (at no additional cost to PTCL) appropriate  equipment and facilities as
per specifications mentioned in respective Clauses of this Agreement at premises
and at points controlled by PTCL so as to

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enable VoIP traffic to terminate in Pakistan  through VoIP gateway at Rawalpindi
to be connected with PTCL's respective transit exchange from the USA & Europe.

AND WHEREAS the Contractor has agreed with PTCL that the VoIP Platform installed
at Rawalpindi by the Contractor shall be owned and operated by PTCL on the terms
and conditions hereinafter appearing.

NOW THEREFORE in consideration  of the mutual covenants  hereinafter set out and
for  good  and  valuable   consideration,   the  adequacy  of  which  is  hereby
acknowledged, the Parties have agreed as under:

1.     DEFINITIONS

       Unless the context otherwise requires, the following terms, wherever used
       in this Agreement, shall have the following meanings:

       (a)    "Act" means the Pakistan Telecommunication  (Re-organisation) Act,
              1996 (Act No. XVII of 1996).

       (b)    "Applicable   Law"  means  the  law  of  Pakistan   including  any
              instruments having the force of law in Pakistan;

       (c)    "Agreement"  means this Agreement  between PTCL and the Contractor
              along with the other  documents  forming part of this Agreement as
              described in Clause 2 hereof;

       (d)    "Basic  Telephone  Service"  means  "basic  telephone  service" as
              defined in the Act;

       (e)    "Securitization  Agreement"  means the agreement  between PTCL and
              LaSalle National Bank,  Chicago dated 14.8.1997  pursuant to which
              certain receivables of PTCL are securitized;

       (f)    "VoIP" or "Voice  over IP" means the  transmission  of voice  sent
              over  the  packet  switched  data  communication  protocol  set of
              TCP/IP;

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       (g)    "Customer"  means a person in the USA  and/or  Europe  who makes a
              call or fax to Pakistan and such call or fax is routed through the
              VoIP Platform in accordance with this Agreement;

       (h)    "License"  means  the  license  issued  by PTA  to  PTCL  and  any
              amendments thereto;

       (i)    "Party"  means  PTCL or the  Contractor,  as the case may be,  and
              "Parties" means both of them;

       (j)    "VoIP  Platform"  means the  equipment,  hardware/  software to be
              installed  at PTCL  premises at  Rawalpindi  and  connected at the
              level of transit  exchange by the  Contractor for and on behalf of
              PTCL to enable  international  incoming  calls to be terminated on
              any  fixed  line or  mobile  subscribers,  through  PTCL  Network,
              anywhere in Pakistan (using VoIP technology);

       (k)    "US Settlement  Rate" means 50% of Total Accounting Rate (TAR), in
              US cents per minute,  agreed between  Incumbent  Carriers and PTCL
              for termination of international traffic in Pakistan;

       (l)    "PTA" means the Pakistan  Telecommunication  Authority established
              under the Act;

       (m)    "Services"  means the work to be  performed by and the services to
              be undertaken by the Contractor pursuant to this Agreement;

       (n)    "Service  Commencement  Date" means the date on which VoIP traffic
              will start being  terminated  on the VoIP  Platform in  accordance
              with this Agreement.

       (o)    "Effective Date" means June 15th 2002.

       (p)    "Legal  Traffic"  means  total  incoming  international  voice/fax
              traffic passing through PTCL's international gateway exchanges and
              terminated  on any  type of  telephone  subscribers  through  PTCL
              network of transit and local exchanges;

       (q)    "Illegal Traffic" means  international  incoming voice/fax traffic
              using  VoIP or any  other  technology  terminating  on any type of
              telephony   network,   bypassing  PTCL's   international   gateway
              exchanges  through  various means  including leaky PABX (excluding
              VoIP  traffic  under  this  Agreement)  and/or  any  other  bypass
              mechanism using VoIP or any other technology;

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       (r)    "Day"  means a Day on which  banks  are open for  business  in USA
              and/or Pakistan, as may be relevant.  This definition relates only
              to payment obligations under this Agreement.

       (s)    "Terminated  Minutes,"  means  the  total  incoming  international
              voice/fax  traffic   terminated  at  PTCL's  transit  exchange  at
              Rawalpindi  routed  through the VoIP  Platform.  For  avoidance of
              doubt, Terminated Minutes shall not include incoming international
              voice/fax  traffic,  the  duration  of which is less  than 6 (six)
              seconds;

       (t)    "Incumbent  Carriers" means such foreign  carriers of USA & Europe
              with whom PTCL has bilateral agreements or arrangements for direct
              international traffic "as listed in Schedule V";

       (u)    "Designated Account" means the bank account to be notified by PTCL
              to the  Contractor on or before the Service  Commencement  Date or
              from time to time  thereafter,  in which the Contractor shall make
              payments.

       (v)    "Statement  of  Qualification  (SoQ)":  means the statement in the
              format  specified in the Proposal Form  comprising  benchmarks and
              requirements  for  eligibility  of the  party  to  enter  into  an
              agreement  with  PTCL  for  termination  of  additional   incoming
              international traffic through VoIP.

       (w)    "USA" shall mean and include the United  States of America and all
              other countries bearing Country Code,"+1"

       (x)    "CDR" shall mean Call Data Record.

       Other terms not  defined in this  Section  will have the same  meaning as
       defined  in  the  Act  and,  if not  defined  in the  Act,  as  generally
       understood in the telecommunication industry.

2.     THE AGREEMENT DOCUMENTS

       The following  documents  form an integral and  substantive  part of this
       Agreement  and, in the event of any  inconsistencies  between  them;  the
       order of precedence shall (unless expressly stated to the contrary) be as
       follows:

       (a)    Preamble and Recitals to this Agreement;

       (b)    Main body of this Agreement; and

       (c)    Schedules to this Agreement.

       (d)    Statement of Qualification

3.     ENTIRE AGREEMENT

       This  Agreement  constitutes  the entire  agreement  with  respect to the
       subject  matter hereof and hereby  cancels and supersedes any and/ or all
       previous or

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       contemporaneous  agreements,  representations or understandings,  whether
       oral or written  between the  Parties  pertaining  to the subject  matter
       hereof.  This  Agreement  shall not be modified  or amended  except by an
       agreement in writing signed by the Parties.

4.     DURATION OF AGREEMENT

       This  Agreement  shall come into effect on the  Effective  Date and shall
       remain valid  initially for a term of one (1) year,  subject to extension
       at the option of Contractor for an additional one (1) year. If, following
       the exercise by the  Contractor of its option to extend the Agreement for
       an additional one (1) year, either Party desires extension in the term of
       this  Agreement,  it shall give the other a notice to this effect 90 days
       in advance prior to termination date of the agreement.  If the Parties do
       not agree to any extension as aforesaid, the term of this Agreement shall
       expire on the first  anniversary  of the Effective Date if the Contractor
       has not elected to extend the Agreement by an additional  one (1) year or
       if the  Contractor  has so elected (by written notice to PTCL such notice
       to be served  not less than  sixty  days prior to the expiry of the first
       anniversary of the Effective Date).

5.     SERVICE COMMENCEMENT DATE

       The Contractor agrees that the Service  Commencement Date shall be a date
       not later than sixty (60) Days  after the  Effective  Date,  or any other
       date,  which PTCL may agree to in writing  prior to the expiry of such 60
       (sixty)  Days  period  subject  to  clause  13  of  this  Agreement.  The
       Contractor  undertakes and agrees that by the Service  Commencement  Date
       the VoIP Platform shall be fully  functional so as to enable Customers to
       make  international  calls to Pakistan using VoIP technology  through the
       VoIP  Platform  in the  manner  and on the  terms  contemplated  by  this
       Agreement.

6.     OBLIGATIONS OF THE CONTRACTOR

       The  Contractor   shall  be  responsible  for  the  design,   supply  and
       installation  of the VoIP Platform in accordance  with and subject to the
       terms of this  Agreement.  The Contractor  shall on or before the Service
       Commencement  Date  provide  PTCL  the  invoice  of the  equipment  to be
       installed in VoIP Platform. In addition to this obligation the Contractor
       agrees to use its best efforts to ensure that Customers are made aware of
       the option to connect to Pakistan  through the VoIP Platform and for such
       purpose the Contractor agrees to ensure that

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       appropriate  marketing  takes place of this  option and that  competitive
       prices are charged to  Customers  so as to ensure the  development  of an
       appropriate  market and so as to facilitate the  substitution  of Illegal
       Traffic.

       6.1    Standard of Performance

              The  Contractor  shall  perform  the  Services  and  carry out its
              obligations   under  this   Agreement   with  all  due  diligence,
              efficiency  and economy,  in accordance  with  generally  accepted
              techniques  and  practices  used in the sector  and shall  observe
              sound  management  practices.  The  Contractor  shall  always,  in
              respect of any matter  relating  to the  installation  of the VoIP
              Platform,  act as faithful  contractors  to PTCL, and shall at all
              times  support  and  safeguard  PTCL's  legitimate  interests,  as
              reasonably determined by PTCL.

       6.2    VoIP Equipment

              (a)    All the  equipment  and other items to be installed at VoIP
                     Platform   should  be  brand  new,  of  the  latest   model
                     available,   chassis   based   with   embedded   processor,
                     expandable,   A-law  compatible,   having  ITU  SS7  (ISUP)
                     signaling capability,  supporting voice/fax through dynamic
                     universal  port,  ANI   authentication,   IVR  for  trouble
                     announcement and number proscriptions.  Moreover,  the VoIP
                     Platform  should be capable  of  passing  on call  progress
                     signals,   providing   billing   information   and  network
                     management capabilities as per Schedule I. For avoidance of
                     doubt,  Contractor  shall not install in the VoIP  Platform
                     such equipment having quality and  specifications  inferior
                     to those mentioned in the Agreement.

              (b)    All  equipment,  hardware,  software  and other items to be
                     installed for the VoIP Platform shall be in accordance with
                     and as laid down in PTCL specifications approved in writing
                     by PTCL.  PTCL will provide  reasonable  assistance  to the
                     Contractor   in  obtaining   any  required   approval,   if
                     necessary,   from  PTA  prior  to  its  installation.   The
                     Contractor is required to provide detailed list for all the
                     equipment  (to be  installed  and  used in  VoIP  Platform)
                     including the quantities,  origin,  model number,  existing
                     certifications     and     contact     names     of     the
                     manufacturer/supplier  along with  relevant  literature  so
                     that the approval  thereof can be processed  expeditiously.
                     Contractor  will not install any  unapproved  equipment  to
                     interface  with PTCL network  under any  circumstances  and
                     will be entirely

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                     responsible  for all costs incurred if any equipment is not
                     approved by the PTCL prior to installation.

              (c)    Performance Criteria for VoIP Equipment

                     Listed  below  are  some of the key  features  of the  VoIP
                     Platform  that  will  need  to be  verified  prior  to  the
                     approval of the  equipment.  These items are provided as an
                     indicative   list  only  and  the  final  approval  of  the
                     equipment and its  acceptance  for interface  with the PTCL
                     network may be based on additional  items in the discretion
                     of PTCL:

                     (i)    The major  modules of the system,  e.g.  hard disks,
                            CPU, main memory etc. shall be duplicated;

                     (ii)   The  system   shall  be  highly   reliable  and  the
                            configuration  of the system  shall be such that the
                            stored data is not lost in any case due to faults in
                            the system.  This will need to be demonstrated under
                            different kinds of failure scenarios;

                     (iii)  The system  shall have  fully  redundant  back up to
                            cope with the malfunctioning of any part of the VoIP
                            Platform.  It shall have redundant processing units,
                            subscriber   database,    storage,    administrative
                            processors,  switching  network,  alarming devices /
                            systems etc.

       6.3    The Services

              (a)    The  Contractor  agrees  to  design,   install,   test  and
                     commission  at  entirely  its own cost and expense the VoIP
                     Platform at  Rawalpindi in PTCL premises as may be mutually
                     agreed by the Parties in writing. Once the VoIP Platform is
                     tested and commissioned into service, the Contractor agrees
                     that the VoIP  Platform  shall be handed over to PTCL at no
                     cost. For avoidance of doubt it is clarified that after the
                     equipment is handed over to PTCL, the Contractor  shall not
                     under any  circumstances  or for any reason claim return of
                     the  equipment,  its cost,  damages  etc, if the  Agreement
                     expires or is earlier terminated under the terms hereof.

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              (b)    The Contractor hereby represents and warrants that the VoIP
                     Platform shall be free from all material  defects and shall
                     be capable of terminating  international calls from the USA
                     and Europe within the performance  parameters  contemplated
                     by this Agreement.  Without  prejudice to the generality of
                     the foregoing, the Contractor agrees that the VoIP Platform
                     when used shall meet the performance  criteria set forth in
                     Section  6.2(c)  hereto.  The VoIP Platform  shall generate
                     data that presents a complete and accurate picture of usage
                     of VoIP Platform for termination of international calls. In
                     the  event  that  there is any  defect or fault in the VoIP
                     Platform during the term of this Agreement,  the Contractor
                     agrees to promptly  remedy such  defects  (including  spare
                     parts) at its own cost and expense.  The  Contractor  shall
                     use its best  endeavors  to ensure that any defect or fault
                     in the  VoIP  Platform  shall be  fully  remedied  within 3
                     (three) Days of such defects or fault arising.

              (C)    In  order  for  PTCL  to  make,  the  required   facilities
                     available to accommodate the VoIP Platform,  the Contractor
                     shall  submit to PTCL  details of its  requirements  in the
                     form of a site  preparation  plan within 7 (seven)  Days of
                     the  Effective  Date.  PTCL  shall  within 7  (seven)  Days
                     thereafter approve such plan or suggest changes therein. In
                     the  event  PTCL  does  not  communicate  its  decision  as
                     aforesaid,  the  site  preparation  plan  submitted  by the
                     Contractor  shall be deemed  acceptable,  provided  however
                     that,  the  Contractor  shall have at least 45 (forty five)
                     Days before the anticipated  Service  Commencement  Date to
                     implement such plan. The site preparation plan will consist
                     of  details of  requirements  for floor  space,  electrical
                     connectivity,  air-conditioning  etc.  If PTCL in its  sole
                     discretion  prepares a final plan, the  Contractor  will be
                     required to install the VoIP  Platform in  accordance  with
                     this final  plan.  In any event PTCL shall  supply  free of
                     charge   industry   standard   co-location   space  to  the
                     Contractor (As per Schedule VI).

              (d)    While  PTCL will  provide  all  available  assistance,  the
                     Contractor is completely responsible for performing its own
                     due diligence  regarding  the PTCL network for  interfacing
                     the VoIP Platform to the PSTN.

              (e)    PTCL and the Contractor will jointly  prepare  analysis for
                     the traffic  requirements and the consequent  sizing of the
                     connectivity requirements of the Contractor for each of the
                     VoIP Platform. The Contractor will

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                     provide ample notice to PTCL for the interface requirements
                     for the VoIP Platform such that the final decision  between
                     the  Parties  in respect of the same is reached at least 45
                     (forty  five)  Days  prior  to  the   anticipated   Service
                     Commencement Date.  Similar  arrangements shall apply after
                     the Service  Commencement Date if the demand for use of the
                     VoIP service expands and consequently  greater connectivity
                     is required.

              (f)    The  Contractor  will  market  the VoIP  service in USA and
                     Europe at its own cost, expense and responsibility.

              (g)    The  Contractor   will  be  responsible   for   technically
                     establishing the new links from USA/EUROPE to VoIP Platform
                     in Pakistan  and between the VoIP  Platform and PTCL's PSTN
                     network  including  the cost of all  hardware/software  and
                     shall  be  responsible   for  providing  at  its  own  cost
                     appropriate  training  for the PTCL  staff to  ensure  that
                     there is a smooth and effective  interface between the VoIP
                     Platform and the PTCL Digital Transit Exchange (DTE).  PTCL
                     will  be   responsible   for   one-half   of  the  cost  of
                     connectivity  (or for the Pakistan half circuit in the case
                     of IPLC) between USA/"Europe" and Pakistan which may be, by
                     option of Contractor,  by (1) PTCL IP IPL between 60 Hudson
                     Street,   New  York  and   Pakistan,   (2)  IPLC  on  fiber
                     (SeMeWe3/FLAG,  etc.  and  onward  fiber),  or (3)  IPLC on
                     satellite,  and in any of these cases PTCL will  provide at
                     its expense all IP connectivity between cable head or earth
                     station in Pakistan and Contractor's POP in Rawalpindi.

              (h)    The  Contractor  shall  terminate only traffic from USA and
                     Europe through the VoIP Platform.  Contractor hereby agrees
                     to terminate 3 to 5 million  minutes per month per location
                     through the VoIP Platform  focusing on capturing of Illegal
                     Traffic.  In  consideration  of the Contractor  terminating
                     traffic under this Agreement,  fixed  terminations  rate of
                     US$  0.19 (US  cents  nineteen  only)  per  minute  will be
                     applicable  till the revision of the US carrier  settlement
                     rates  (bilateral  carrier  rate).  Subsequent  termination
                     benchmark  rate would be revised as provided for in Section
                     12.6 of this Agreement.

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7.     APPROVAL OF EQUIPMENT

       PTCL will not unreasonably  delay processing of a request for approval of
       the equipment to be used in the VoIP Platform from the  Contractor.  PTCL
       shall not unreasonably withhold approval of such equipment for use in the
       Services and will inform the  Contractor of the reasons for not approving
       any such  equipment.  Any approval  provided by PTCL shall not in any way
       impact on or derogate from the obligation on the Contractor to obtain all
       approvals  required  under the laws of  Pakistan  in  respect of the such
       equipment  and the  installation  thereof  including  any Type  Approvals
       required from the PTA. The Contractor shall submit to PTCL details of the
       equipment  to be used in the VoIP  Platform  within 7 (seven) Days of the
       Effective Date. PTCL shall within 7 (seven) Days thereafter  approve such
       equipment  or  suggest  changes  therein.  In the  event  PTCL  does  not
       communicate  its  decision as  aforesaid,  the details of such  equipment
       submitted  by  the  Contractor  shall  be  deemed  acceptable,  provided,
       however,  that the  Contractor  shall have at least 45 (forty  five) Days
       before the anticipated Service Commencement Date to implement the same.

8.     ACCESS TO THE VOIP PLATFORM

       The number of  circuits  to be provided by PTCL will be based on the size
       of the VoIP Platform and the traffic analysis and will be mutually agreed
       between PTCL and the Contractor.  PTCL will provide the Contractor access
       to the VoIP Platform  within 60 (sixty) Days of the Effective Date and in
       case PTCL is not able to provide such access within this stipulated time,
       the Service Commencement Date will be extended accordingly.

9.     TECHNICAL ARRANGEMENTS WITH PTCL NETWORK

       9.1    PTCL will provide the VoIP Platform,  an interconnection at the El
              level on the Rawalpindi transit exchange as shown diagrammatically
              in Schedule II. No special  routing  requests from the  Contractor
              will be entertained by PTCL.

       9.2    PTCL and the  Contractor  will  mutually  agree to prepare  demand
              analysis for the projected  traffic and the  consequent  sizing of
              the  connectivity  requirements  of the  Contractor  for the  VoIP
              Platform in  Rawalpindi.  This exercise will be conducted at least
              once a year but may be  conducted  earlier or more  frequently  on
              mutual agreement. PTCL will fully cooperate

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              with the  Contractor in finalizing  the  connectivity  requirement
              schedule and will not unreasonably delay such an arrangement.

       9.3    PTCL will  co-operate  with the  Contractor  and will  furnish the
              Contractor with all relevant information and data concerning PTCL,
              which PTCL and the Contractor  mutually  agree as appropriate  for
              determining  the  compatibility  of interfacing its equipment with
              the PTCL network.

10.    REPORTING OBLIGATIONS OF CONTRACTOR

       The  Contractor  shall  submit  to  PTCL  CDRs  generated  in a  platform
       installed in USA and Europe on a  fortnightly  basis.  CDRs for the first
       fortnight  of a given month shall be  submitted  on or before the 21st of
       such  month,  and the CDRs for the second  fortnight  in the given  month
       shall be  submitted  on or before the 7th of the  following  month.  CDRs
       submitted  as  aforesaid  will  include  number  of  calls  and  recorded
       Terminated  Minutes on a per originating and destination basis, and shall
       be in the following format:

       -------------------------------------------------------------------------
        Date      A-Tel*    B-Tel    Start    End Time    End Date   Duration
                                     Time
       -------------------------------------------------------------------------

       -------------------------------------------------------------------------
        * Note: Country Code will be a part of A-Tel.

11.    BILLING & PAYMENT The Contractor shall:

       i.     Keep  accurate and  systematic  accounts and records in respect of
              revenues  generated  from sale of VoIP  service  to  Customers  in
              accordance with  internationally  accepted accounting  principles.
              For avoidance of doubt it is clarified that CDRs will be generated
              on per  second  basis,  however,  will be  charged on the basis of
              cumulative  minutes.  (e.g.  if the  total  number  of  cumulative
              seconds in a billing period is 106,800,261,  then the total number
              of minutes to be billed at the Termination  Rate will be 1,780,004
              minutes).

       ii     (a)    Submit CDRs generated in a platform installed in USA/Europe
                     to PTCL under  Clause 10 above.  Such CDRs will be compared
                     with records  created in the PTCL transit  exchanges.  PTCL
                     will  generate  bills  based  on  figures  at PTCL  transit
                     exchanges. However, the CDRs supplied by the

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                     Contractor  must be in a format  readable  by PTCL  billing
                     centers.  Subject to provisions of sub clause (b) below, in
                     case of any variation between the Contractor's CDRs and the
                     figures    generated   through   CDRs   of   PTCL   transit
                     exchanges/VoIP   Platform,  the  PTCL  CDRs  figures  shall
                     (subject to paragraphs  (b) and (c) below) be considered as
                     final and  conclusive for the purpose of billing under this
                     "Agreement".  Amount  so  determined  and  billed  shall be
                     binding on the Contractor.

              (b)    In case of any discrepancy in CDR's  reconciliation  (where
                     PTCL  CDR   shows   more   minutes   terminated   than  the
                     Contractor's  CDR) up to 0.75% or less of the relevant CDR,
                     the Contractor  shall not make the same a basis for dispute
                     and shall pay the same.  However,  the  contractor  will be
                     given due  opportunity  to  highlight  any  discrepancy  in
                     PTCL's  CDR for  correction  and if,  such  discrepancy  is
                     accepted by the PTCL the  contractor  shall be entitled for
                     the credit. In case, the discrepancy exceeds the afore said
                     figure of 0.75 %, the  Contractor  shall pay the undisputed
                     amount and the parties will resort to mutual  negotiations,
                     reconciliation and settlement for the disputed amount.

              (c)    If the  settlement  is not arrived at amicably  within four
                     weeks,  the  dispute  may be  resolved  through the dispute
                     resolution  mechanisms provided in this agreement or as may
                     otherwise be agreed between the parties.

       iii.   be billed  fortnightly for the number of minutes multiplied by the
              agreed  rate which is US$ 0.19 (US cents  nineteen)  per minute at
              present.  The bill will be e-mailed/faxed to the Contractor or its
              designated  agent,  which  shall  be the  valid  document  for the
              purpose  of  payments.  However,  for the  purposes  of record and
              fulfillment of other contractual requirements,  the hard copies of
              such invoices  shall later on be provided to the contractor by the
              PTCL.

       iv.    solely be  responsible  for the payment  within  seven days of the
              "confirmed"   issuance/transmission   of   the   invoice   through
              e-mail/fax.  The date and time for the payment shall be calculated
              from  the  date of  issuance/transmission  of such  invoices.  For
              avoidance of any doubt it is hereby  clarified  that only the date
              of  credit  of  payment  into the  "Designated  Account"  shall be
              considered as payment receipt date.

       v.     solely  be  responsible  for  the  suspension  of  service  at the
              discretion of the PTCL for such period of time till the payment is
              not made within stipulated

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              period  of time.  PTCL  shall  have the  right  to  terminate  the
              "Agreement" if the service is suspended due to non-payment.

12.    CHARGES AND DEPOSITS

       12.1   Proposal Security

              To determine its seriousness in the project,  an amount of Rs. 5.0
              (M)  (rupees  five  million  only)  or   US$.84,000   (US  Dollars
              Eighty-four   Thousand   only)  per  site  in  the  shape  of  pay
              order/demand  draft  issued by any  Pakistani  scheduled  Banks as
              proposal  security  was  deposited  by  the  contractor  with  the
              Pakistan  Telecommunication  Company Limited (PTCL). This proposal
              security will be refunded to the  Contractor  after the receipt of
              full amount of rolling advance. Failure to deposit rolling advance
              within the stipulated  period of time so explained in Clause 11 of
              the  "Agreement"  shall result in the  forfeiture  of the proposal
              security without any notice.

       12.2   Rolling Advance for Billing

              12.2.1 The  Contractor  shall  within  15  (fifteen)  days  of the
                     Effective Date of the  "Agreement"  deposit and maintain in
                     the  "Designated  Account" a cash rolling advance to secure
                     amounts due from the  Contractor  under this  Agreement  in
                     respect  of  calls  terminating  through  use of  the  VoIP
                     Platform.  The Rolling Advance shall be based on the PTCL's
                     billing estimate for 30 (Thirty) Days following the Service
                     Commencement  Date and the  minimum  amount of the  rolling
                     advance  (regardless of actual billing) shall be based on 3
                     (three) million  Terminated  Minutes per month per site. In
                     case the  Terminated  Minutes  per month  increase  above 3
                     (three) million, the rolling advance shall be increased PRO
                     RATA.  The rolling  advance will be topped up in accordance
                     with  the   procedure   laid  down  in   clause-12  of  the
                     "Agreement"  and the  amount of  rolling  advance  shall be
                     maintained by the contractor  until the  termination of the
                     "Agreement"   and  thereafter   till  the  full  and  final
                     settlement  of its amounts due to PTCL.  In the event there
                     are no amounts due to PTCL from the Contractor, the balance
                     of the rolling  advance  shall be  refunded.  No  interest,
                     profit or other return shall accrue on the rolling  advance
                     to the Contractor.  Whenever  traffic exceeds three million
                     minutes in a calendar month,  PTCL will issue the notice to
                     the contactor for topping up the rolling  advance,  and the
                     Contractor  shall  within 7 (seven) Days top up the rolling
                     advance.  In case  Contractor  fails to top up the  rolling
                     advance,  PTCL may at its sole discretion and without prior
                     notice to the Contractor  terminate this Agreement  without
                     prejudice to

                                     - 13 -
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                     any other interest or claim that may have accrued in favour
                     of PTCL or to which PTCL may in the future be  entitled  to
                     under this Agreement.

              12.2.2 If  as  a  direct  consequence  of  any  act,  omission  or
                     violation  committed by the  Contractor in connection  with
                     the provision of the Services (as  reasonably  demonstrated
                     by PTCL),  the non-VoIP  traffic of PTCL from either USA or
                     Europe decreases as set forth in Schedule-III hereto, other
                     than  as a  result  of  migration  of  some  percentage  of
                     Contractor's  existing  traffic on the VoIP platform,  then
                     the  Contractor  will,  in addition to being  liable to pay
                     PTCL in accordance with the terms of this Agreement for the
                     VoIP  traffic  routed  through  the VoIP  Platform,  become
                     liable to pay  compensation  to PTCL as calculated  and set
                     forth in Schedule IV. The maximum  compensation  claimed by
                     PTCl  shall not be more than the  total  number of  minutes
                     that  have  been  terminated  by the  Contractor  for  that
                     period.  PTCL will gave no more that 30 days  after the end
                     of the billing cycle to make such claim. All such claims by
                     PTCL will be made in writing  after the end of thirty  (30)
                     days of the billing cycle shall be invalid.  The Contractor
                     shall however render all possible  assistance,  cooperation
                     and support to PTCL to  identify  parties  responsible  for
                     terminating  voice traffic  bypassing PTCL's  International
                     Gateways.

       12.3   The  Contractor  shall be liable  to pay PTCL for each  Terminated
              Minute of an  incoming  call  routed  through  the VoIP  Platform.
              Regardless  of the total number of incoming  calls routed  through
              VoIP  Platform,  the  Contractor  will make a  minimum  guaranteed
              payment to PTCL  based on 3 (three)  million  incoming  Terminated
              Minutes of VoIP  Platform  per month per site,  unless it has been
              precluded  from passing the minimum number of minutes due to Force
              Majeure.  Keeping in view initial traffic  built-up  process,  the
              minimum 3 (three)  million  Terminated  Minutes per month per site
              will be averaged over a period of 3 (three) months.  However,  the
              Rolling Advance will increase to cover the difference of 3 (three)
              million  Terminated Minutes and actual traffic for that month. For
              example  if the  traffic  for a  month  is  only 1  (one)  million
              Terminated  Minutes  the Rolling  Advance  will be topped up by an
              amount equal to 2 (two) Million  Terminated  Minutes multiplied by
              US$ 0.19 (US cents nineteen) US$ 380,000.  However the payment for
              first 3 (three)  months will be for a minimum of 9 (nine)  Million
              Terminated Minutes.

       12.4   The  Contractor  shall make all due payments  under this Agreement
              (as per relevant  Clauses/Schedules) in PTCL's Designated account,
              which  will not be subject to any  deductions,  counter-claims  or
              set-off.

                                     - 14 -
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       12.5   PTCL  reserves the right at any time to require the  Contractor to
              provide an additional  security  deposit,  or irrevocable  standby
              letter of credit or other form of security  acceptable to PTCL, in
              case  of  the  Contractor's  unsatisfactory  financial  condition,
              payment  history  or credit  check is or becomes  unacceptable  to
              PTCL. In all such cases, the Contractor will be given 15 (fifteen)
              Days notice to remedy the situation to the  satisfaction  of PTCL.
              "If the  contractor  does not agree  with the  demand of PTCL then
              either  party has the right to terminate  the  contract  effective
              immediately.  Unused  balance of the rolling  advance after making
              necessary  adjustments  will be returned to the contractor  within
              thirty (30) days of termination of the contract."

       12.6   The rates set forth in this  Agreement  in  respect  of per minute
              charges for incoming calls shall be locked-in until revision of US
              carrier settlement rate (bilateral carrier rate).  However,  these
              shall not be more than US$ 0.19 (US cents nineteen) per minute and
              shall be reviewed at least  biannually on 1st January and 1st July
              every year in the light of bilateral  settlement  accounting rates
              to ensure that the rate remains 15% below  settlement rate i.e. US
              Settlement Rate minus15% of that.

13     PROGRAMME OF COMMITMENTS (MILESTONES)

       13.1   Notwithstanding   any  thing  contained  in  the  Agreement,   the
              commitments  for the  commencement of service shall be carried out
              in accordance  with the programme of commitments  (Milestones)  as
              stipulated in Schedule VI.

       13.2   If,  after the Date of execution  of the  Agreement,  either party
              shall have been  delayed or impeded by any act or  omission of the
              said party or any circumstances  beyond the reasonable  control of
              that  party,  in that  event the  subsequent  milestones  shall be
              extended by the period of such delay.

       13.3   Notwithstanding  13.2,  if PTCL does not stay within the timetable
              for its tasks as set forth in the attached  Milestone Schedule VI,
              then at the request of Contractor,  the Rolling Advance on deposit
              with PTCL and the equipment shall, within five (5) days after such
              request,  be returned to Contractor and the Agreement  shall stand
              terminated   if  the  overall  delay  is  more  than  four  weeks,
              otherwise,  if the  overall  delay is equal to or less  than  four
              weeks,  then PTCL will pay  interest  on the  Rolling  Advance  to
              Contractor  at the rate of LIBOR (as  measured on the first day of
              delay) plus 2% per annum for the total number of days of delay.

                                     - 15 -
<PAGE>

PAKISTAN

       13.4   Notwithstanding  any thing  contained in the Agreement  other than
              clause 13.2, if the Contractor  fails to complete the  commitments
              by the  completion  Dates in accordance  with the Schedule VI, the
              PTCL shall have the right to terminate  the Agreement by returning
              the Rolling  Deposit to Contractor  and retaining the equipment by
              PTCL, provided that the delay is more than four weeks.

14.    CURRENCY OF PAYMENT

       All  payments by the  Contractor  under this  Agreement  except  Proposal
       Security shall be made to the Designated Account in US Dollars.

15.    SUBCONTRACTORS

       15.1   The Contractor shall not engage any  subcontractor in Pakistan for
              the  performance of any of the Services  without the prior written
              approval  of PTCL  including  the  terms of such  engagement.  The
              Contractor shall provide to PTCL such details as PTCL may request.
              The  Contractor  may not  terminate or amend terms of the approved
              subcontractor without prior written approval of PTCL.

       15.2   The  appointment  of  any  subcontractor  shall  not  relieve  the
              Contractor from any liability or obligation under this Agreement.

16.         REVIEW

       16.1   Either  Party may seek to amend this  Agreement  by serving on the
              other a review notice if:

              (a)    the License is materially modified (whether by amendment or
                     replacement)  to  the  extent  that  such  modification  or
                     replacement directly or indirectly affects the provision of
                     the Services; or

              (b)    a  material   change  occurs  in  the  law  or  regulations
                     (including  codes of  practice  whether  or not  having the
                     force of law) governing telecommunications in Pakistan; or

              (c)    a  material  change  (including  enforcement  action by any
                     regulatory  authority)  occurs which  affects or reasonably
                     could be expected  to affect the  commercial  or  technical
                     basis of this Agreement.

       16.2   A review notice shall set out in reasonable  details the issues to
              be discussed between the Parties.

                                     - 16 -
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PAKISTAN

       16.3   On the service of a review  notice,  the Parties  shall  forthwith
              negotiate in good faith, the matters to be resolved with a view to
              agreeing the relevant amendments to this Agreement.

       16.4   If the Parties fail to reach  agreement on the subject matter of a
              review notice within 3 (three)  months from the date of service of
              such  review  notice,  either  Party may at its  option  after the
              expiry of the aforementioned 3 (three) month period terminate this
              Agreement without any further obligation or liability.

       16.5   If either Party is required by  applicable  law or  regulation  to
              modify or discontinue the Services or any part thereof then either
              Party  reserves  the right to do so and will  notify  the other as
              soon as possible of any such modification which shall forthwith be
              binding  on  the  Parties  and  neither   will  have  any  further
              obligation   or   liability  to  the  other  in  respect  of  such
              modification.  "However,  if these  modifications  are  materially
              detrimental to the other Party then that other Party can terminate
              this Agreement  without  liability by providing one month's notice
              in writing to the first party."

17.    FORCE MAJEURE

       For the  purposes of the  Agreement,  "Force  Majeure"  means an event or
       circumstance which is beyond the reasonable control of a Party, and which
       makes a Party's  performance  of its  obligations  under  this  Agreement
       impossible, and includes, but is not limited to, Acts of God, war, riots,
       civil  disorder,  earthquake,  fire,  explosion,  storm,  flood  or other
       adverse  weather  conditions,   strikes,  lockouts  or  other  industrial
       action.,

       17.1   Force Majeure shall not include:

              17.1.1 an  event,  which is caused by the  negligence  or  willful
                     action of a Party or its subcontractor;

              17.1.2 an event which a diligent Party could  reasonably have been
                     expected to:

                     (i)    have taken into account as at the Effective Date, or

                     (ii)   have  avoided or  overcome in the course of carrying
                            out its obligations under this Agreement. 17.2 Force
                            Majeure shall not include  insufficiency of funds or
                            circumstances  arising  from a  failure  to make any
                            payment required by this Agreement.

       17.3   The  failure of a Party to fulfill  any of its  obligations  under
              this  Agreement  shall not be  considered  to be a breach of, or a
              default under, this Agreement insofar as the inability arises from
              an event of Force Majeure,

                                     - 17 -
<PAGE>

PAKISTAN

              provided  that  the  Party   affected  by  that  event  has  taken
              reasonable  precautions,  due care and  attempted  to put in place
              reasonable  alternative  arrangement  all  with the  objective  of
              carrying out the terms of this Agreement without delay.

       17.4   Measures to be Taken

              A Party  affected  by an  event of Force  Majeure  shall  take all
              reasonable  measures  to  remove  its  inability  to  fulfill  its
              obligations under this Agreement with a minimum of delay and shall
              notify the other Party in writing of the event  concerned  as soon
              as  possible,  and in any  event not  later  than 7  (seven)  Days
              following  the  occurrence  of  the  event  concerned,  and  shall
              similarly give notice of the  restoration of normal  conditions as
              soon as possible.  The Parties shall take all reasonable  measures
              to minimize the consequences of any event of the Force Majeure.

       17.5   Extension of Time

              Any period, within which a Party must, pursuant to this Agreement,
              complete any action or task, shall be extended Day-for-Day up to a
              period  equal to the time  during  which  that Party was unable to
              perform such action as a result of Force Majeure.

       17.6   Consultation

              Not later than 14 (fourteen)  Days after a Party has become unable
              to perform a material  portion of the Services as the result of an
              event of Force Majeure,  the Parties shall consult with each other
              with a view to agreeing on appropriate measures to be taken in the
              circumstance.

18.    TERMINATION

       18.1   Either Party may terminate this  Agreement  immediately on written
              notice if the other:

              (a)    commits  a  material  breach  of this  Agreement,  which is
                     capable of remedy,  and the Party in breach fails to remedy
                     the breach within a reasonable  time of a written notice to
                     do so; or

                                     - 18 -
<PAGE>

              (b)    commits a material breach of this Agreement which cannot be
                     remedied; or

              (c)    is  repeatedly  in  breach of this  Agreement  "and has had
                     prior  notice  in  writing  that a  further  breach of this
                     agreement will result in termination of it"; or

              (d)    is the subject of a bankruptcy order, or becomes insolvent,
                     or makes any arrangement or composition  with or assignment
                     for the benefit of its creditors, or if it goes into either
                     voluntary (other than for  reconstruction  or amalgamation)
                     or compulsory  liquidation,  or a receiver or administrator
                     is appointed  over its assets or if the  equivalent  of any
                     such  events   under  the  laws  of  any  of  the  relevant
                     jurisdictions occurs.

       18.2   PTCL may, by not less than 15 (fifteen)  Days'  written  notice to
              the  Contractor  "(during  which  period the  contractor  shall be
              entitled  and   permitted  to  attempt  to  remedy  the  breach):,
              terminate this Agreement without prejudice to any rights which may
              have  accrued  under this  Agreement to either Party prior to such
              termination, if:

              18.2.1  the VoIP Platform has an adverse impact on PTCL network;

              18.2.2  any subcontractor does or allows anything to be done which
                      in PTCL's  reasonable  opinion is likely to jeopardize the
                      operation of the PTCL network;

              18.2.3  the  Contractor  files  with PTCL a  statement  in writing
                      which has a material effect on the rights,  obligations or
                      interests of PTCL and which the Contractor knows or should
                      reasonably have known to be false;

              18.2.4  the  Contractor  is unable as a result of Force Majeure or
                      for any other reason to perform a material  portion of the
                      Services  for a  continuous  period  of not  less  than 60
                      (sixty) Days;

              18.2.5  the Contractor  fails to start full scale  commencement of
                      the  Service  within  30  (thirty)  Days  of  the  Service
                      Commencement Date;

                                     - 19 -
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PAKISTAN

                18.2.6  the Contractor  introduces  any equipment  which has not
                        been approved in advance by PTCL and, where required, by
                        PTA;

                18.2.7  the  Contractor   introduces  or  provides  any  service
                        through  the VoIP  Platform or  otherwise  which has not
                        been approved by PTCL;

                18.2.8  the  Contractor  commits an act which is in violation or
                        which  places PTCL in violation of its License or of the
                        Act;

                18.2.9  PTCL may terminate  this Agreement as provided in Clause
                        12.2;

                18.2.10 Notwithstanding  the foregoing,  after the first year of
                        the  commencement  of  service,  this  Agreement  may be
                        terminated  at any time by  either  Party by  giving  90
                        (ninety) Days written notice to the other Party.

                18.2.11 Without  prejudice to PTCL's general rights to terminate
                        the Agreement, the following INTER ALIA shall constitute
                        a  material   irremediable   breach  by  the  Contractor
                        entitling  PTCL to  terminate  the  Agreement  forthwith
                        without any further liability:-

                        a.      if  Contractor  terminates  more  than 5  (five)
                                million   minutes  per  month   through  a  VoIP
                                Platform  for   consecutive  3  (three)  months,
                                provided  however that,  PTCL shall not exercise
                                its right to terminate this Agreement under this
                                Clause, if the additional minutes terminated are
                                less  than 10% (ten per  cent) of the  aforesaid
                                volume for such period;

                        b.      if  Contractor  terminates  traffic from origins
                                other than Europe and USA through VoIP Platform;

                        c.      if  more   than  25%   (twenty   five   percent)
                                A-telephone numbers in CDRs are not provided;

                        d.      if  Contractor  terminates  traffic  through any
                                other  mechanism  (except  bilateral   gateways)
                                bypassing  VoIP  Platform  installed  under this
                                Agreement.  In addition to the termination,  the
                                Contractor  shall  also be liable to  compensate
                                for the loss  caused  due to  bypassing  of PTCL
                                International/VoIP Gateways.

                                     - 20 -
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                        e.      if the service is suspended for three times in a
                                calendar  year  (due to non  re-couping  and non
                                toping-up of the rolling advance),.

                        f.      any  disclosure  contrary  to  the  information,
                                documents  and other  material  provided  by the
                                contractor.

                        g.      any  disclosure  contrary  to  the  affirmations
                                given in Clause 24.

19.     OBLIGATION AT TERMINATION

        19.1    On termination  of this Agreement in accordance  with its terms,
                or upon  expiration  of this  Agreement  as the  case may be all
                rights and obligations of the Parties shall cease, except:

                a.      rights and obligations  that have accrued as of the date
                        of  termination  or  expiration;  b. the  obligation  of
                        confidentiality  set  forth  in this  Agreement;  c. any
                        right which a Party may have under the  Applicable  Law;
                        d. the  indemnification  obligations  set  forth in this
                        Agreement.

        19.2    Upon termination of this Agreement:

                (a)     the   Contractor   shall   forthwith  pay  to  PTCL  any
                        outstanding  amounts,  which it is  liable  to pay under
                        this Agreement,

                (b)     PTCL  shall  without  delay  return  to  Contractor  all
                        amounts held by it after the  adjustment of payments due
                        to PTCL , if any .

        19.3    Upon  termination of this Agreement by notice of either Party to
                the other  pursuant to this  Agreement,  the  Contractor  shall,
                immediately  on  receipt  of  notice  to that  effect,  take all
                necessary  steps to bring  the  Services  to a close  within  30
                (thirty) Days of the receipt of the notice in an orderly manner.

20.     CONTRACTOR TO COMPLY WITH APPLICABLE LAW

        20.1    The  Contractor  shall pay all the  taxes,  levies,  duties  and
                impositions  on the import of equipment  which are levied on the
                Contractor  within the time  period  stipulated  by the  levying
                authority.  The  Contractor is solely  responsible  for all such
                taxes and duties  even if they are  imposed or become  effective
                after the Effective Date.

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        20.2    The  Contractor  shall be solely  responsible  for obtaining any
                authorization,      registration,     permit     or     licenses
                ("Authorization")  as required  under the  Applicable Law at its
                own cost for any import/export required to be undertaken for the
                performance of its obligations  under this Agreement.  PTCL will
                provide  reasonable  assistance to the Contractor in this regard
                and any delay in  clearance  of any  equipment to be used in the
                VoIP Platform  shall be considered as Force Majeure  pursuant to
                the relevant Clause of this Agreement.

        20.3    The Parties  will at all times comply with the  Applicable  Law.
                The  Parties  will use their best  efforts to ensure  that their
                respective   subcontractors   and  personnel   comply  with  the
                Applicable Law.

21.     FAIRNESS AND GOOD FAITH

        21.1    The Parties  undertake to act in good faith with respect to each
                other's rights and obligations under this Agreement and to adopt
                all  reasonable  measures  to  ensure  the  realization  of  the
                objectives of this Agreement.

        21.2    The Parties  recognize  that it is impractical in this Agreement
                to provide  for every  contingency,  which may arise  during the
                life of the  Agreement,  and the Parties  agree that it is their
                intention  that this  Agreement  shall operate fairly as between
                them,  and without  detriment to the interest of either of them.
                If during the term of this Agreement,  either Party has evidence
                to believe that the other is performing  its  obligations  under
                this Agreement unfairly, then the Parties undertake to use their
                best  efforts  to agree on such  action as may be  necessary  to
                remove the cause or causes of such unfairness.

        21.3    PTCL shall not take any  action,  discriminatory  or  arbitrary,
                which  `materially  or adversely  affects or is likely to affect
                the  enjoyment  of the rights and  interests  of the  Contractor
                under or pursuant to this Agreement.

        21.4    The  parties  agree  that,  save in respect  of death,  personal
                injury and any other  liabilities  that can not be  excluded  by
                law, their aggregate  liabilities to each other under or related
                to this agreement shall not exceed the

                                     - 22 -
<PAGE>

                value of the  Rolling  Advance  at the date upon which the event
                giving rise to the liability arose.

22.     SETTLEMENT OF DISPUTES & ARBITRATION

        22.1    The  provisions  contained  in this  Clause  shall  survive  the
                termination and/or expiration of this Agreement.

        22.2    The Parties shall use their best efforts to settle  amicably all
                disputes  arising out of or in connection with this Agreement or
                its  interpretation.  Any  dispute  between  the  Parties  as to
                matters  arising  under this  Agreement  which cannot be settled
                amicably  within 10 (ten) days after receipt by one Party of the
                other Party's  request for amicable  settlement may be submitted
                by either Party to arbitration in accordance with the provisions
                set out below.

        22.3    In the event of disputes  between the Parties arising out of the
                terms  of  this   Agreement,   the  same  shall  be  settled  by
                arbitration by 2 (two) arbitrators, 1 (one) each to be appointed
                by the  Parties.  The Parties  shall  appoint  such  arbitrators
                within 10 (ten)  working  days of receipt of the first notice in
                this  behalf  by a Party.  In case of a  disagreement  among the
                arbitrators  or if they are unable to resolve the matter  within
                30 (thirty) days  thereafter,  the matter will be referred to an
                umpire nominated by both parties or their  arbitrators who shall
                preferably be a retired judge of the High Court of a Province or
                the  Supreme  Court of Pakistan  or an  internationally  reputed
                Telecom  Lawyer.   The  award  given  by  the  arbitrator(s)  as
                aforesaid shall be binding on the Parties.

        22.4    Arbitration  proceedings  shall be held in Islamabad,  Pakistan.
                The procedure shall be that provided in the Arbitration Act 1940
                and all subsequent amendments thereto.

        22.5    In any arbitration proceedings under this Agreement the decision
                of the  arbitrator  shall  be final  and  binding  and  shall be
                enforceable in any court of competent jurisdiction,  and each of
                the Parties  waives any  objections  to or claims to immunity in
                respect of the enforcement of the claim.

23.     CONFIDENTIALITY

        23.1    The Contractor  shall not,  either during the term, or after the
                expiration  of  this  Agreement,  disclose  any  proprietary  or
                confidential   information   relating  to  the  Services,   this
                Agreement,  or PTCL's  business or operations  without the prior
                written consent of PTCL, unless such disclosure is

                                     - 23 -
<PAGE>

PAKISTAN

                required by law or  regulation or such  information  has entered
                the public domain other than by a breach of this Agreement.  The
                Contractor   agrees  that  it  will  use  its  best  efforts  to
                ensure-that  its  subcontractors  and personnel are bound by and
                comply with the requirement of  confidentiality  set out in this
                Clause.

        23.3    PTCL shall not,  either during the term, or after the expiration
                of this  Agreement,  disclose any  proprietary  or  confidential
                information  relating to the Services,  this  Agreement,  or the
                Contractor's  business or  operations  without the prior written
                consent of the Contractor, unless such disclosure is required by
                law or  regulation  or such  information  has entered the public
                domain  other than by a breach of this  Agreement.  PTCL  agrees
                that  it  will  use  its  best   efforts  to  ensure   that  its
                subcontractors  and  personnel  are bound by and comply with the
                requirement of confidentiality set out in this Clause.

        23.3    Notwithstanding  the provisions of the above  paragraphs of this
                Clause,   the  Parties   may  require   each  other  to  sign  a
                Confidentiality   Agreement  on  a  case-by-case   basis  before
                specific information can be made available.

24.     INDEMNITIES

        The Contractor  shall keep PTCL,  both during and after the term of this
        Agreement, fully and effectively indemnified against all losses, claims,
        damages,  liabilities,  costs and  expenses  incurred by or imposed upon
        PTCL as a consequence of:

        (a)     any conclusive  claim made by a subcontractor of the Contractor;
                (b) any  conclusive  claim made by a Customer  in respect of the
                Services.

25.     AFFIRMATION

        The Contractor declares and affirms that;

        a)      The  Contractor  and  its  shareholders,   directors,  officers,
                employees,  and agents have not paid or received, nor undertaken
                to pay or receive,  any bribe,  pay-off,  kick-back  or unlawful
                commission  and  that  the  Contractor  and  its   shareholders,
                directors, officers, employees, and agents have not in any other
                way or  manner  paid any  sums,  whether  in Rupees or a foreign
                currency and whether in Pakistan or abroad,  given or offered to
                give any such gifts and  presents in Pakistan or abroad,  to any
                official or employee of the PTCL or any

                                     - 24 -
<PAGE>

                other  person  to  procure  this   Agreement.   The   Contractor
                undertakes  not to engage in any of these or similar nets during
                the term of this Agreement.

        b)      Neither the  Contractor  nor any of its director or executive is
                Israeli or Indian national.  Notwithstanding any thing contained
                elsewhere  in  this  Agreement  PTCL  will  have  the  right  to
                terminate the Agreement in the event PTCL has reasons to believe
                that the  Contractor  or any of its  director  or  executive  is
                Israeli or Indian national.

26.     APPLICABLE LAWS

        This Agreement shall be governed by the laws of Pakistan.

27.     RULES OF CONSTRUCTION

        27.1    The  captions or headings in this  Agreement  are  strictly  for
                convenience  and shall not be  considered in  interpreting  this
                Agreement or as amplifying or limiting any of its content. Words
                in this Agreement, which import the singular connotation,  shall
                be  interpreted  as plural,  and words,  which import the plural
                connotation,  shall be interpreted as singular,  as the identity
                of the Parties or objects referred to may require.

        27.2    Unless  expressly  defined  herein,   words  having  well  known
                technical or trade meanings  shall be so construed.  All listing
                of items shall not be taken to be  exclusive,  but shall include
                other items,  whether similar or dissimilar to those listed,  as
                the context reasonably requires.

        27.3    Except as set forth to the contrary herein,  any right or remedy
                of  PTCL or the  Contractor  shall  be  cumulative  and  without
                prejudice to any other right or remedy, whether contained herein
                or not.

        27.4    This  Agreement  has been fully  negotiated  between and jointly
                drafted by the Parties.

        27.5    All  actions,   activities,   consents,   approvals   and  other
                undertakings of the Parties in this Agreement shall be performed
                in  a  reasonable   and  timely  manner,   it  being   expressly
                acknowledged  and understood  that time is of the essence in the
                performance  of  obligations  required to be performed by a date
                expressly  specified  herein.  Except as specifically  set forth
                herein,  for the purpose of this Clause the normal  standards of
                performance  within  the  telecommunications   industry  in  the
                relevant  market shall be the measure of whether a  Contractor's
                performance is reasonable and timely.

                                     - 25 -
<PAGE>

PAKISTAN

28.     NOTICES

        28.1    Any notice, request or consent required or permitted to be given
                or made pursuant to this Agreement shall be in writing and shall
                be deemed to have been given or made when delivered in person to
                any  authorized   representative   of  the  Party  to  whom  the
                communication  is addressed,  or when sent by  registered  mail,
                telex,  telegram  or  facsimile  to such Party at the  following
                address:

                For the Contractor:            For PTCL:
                Exec. Vice President-Int'l     GM (Tele-housing & VoIP)
                Fusion Telecommunications      Pakistan Telecommunication
                International, Inc.            Company Limited
                420 Lexington Avenue           Headquarters G-8/4,
                Suite 518, New York,           Islamabad
                NY, 10170 USA
                Telephone: +1-212-972-2000     Telephone:  92-51-2272021
                Fax:       +1-212-972-7884     Fax:        92-51-2201015/2260710

        28.2    A Notice will be deemed to be effective as follows:

                In case of personal  delivery or  registered  mail, on delivery;
                and in the case of facsimiles, 24 (twenty -four) hours following
                confirmed  transmission,   disregarding  weekends  and  national
                holidays.  Facsimile  notices shall not require  confirmation by
                hard copies.

        23.3    Party may change its address or fax number for notice under this
                Agreement  by giving the other  Party  notice  pursuant  to this
                Clause.

29.     ADDITIONAL TERMS

        29.1    The  Contractor  undertakes  and warrants that the VoIP Platform
                and the  equipment  installed  for PTCL  will not in any  manner
                damage  property of PTCL or in any way interfere  with or affect
                PTCL's  existing  system  or  services.  The  Contractor  hereby
                undertakes  to  indemnify  PTCL for any  loss,  damage,  cost or
                expense incurred by PTCL(unless  caused by erroneously  supplied
                information  or the act of omission of PTCL) as a consequence of
                a breach by the Contractor of this undertaking and warranty. For
                the avoidance of doubt,  it is understood  that  commencement of
                operations under this Agreement on the Service Commencement Date
                shall be deemed fulfillment of this Clause, and the

                                     - 26 -
<PAGE>

PAKISTAN

                Contractor shall,  following the Service Commencement Date, have
                no liability under this Clause.

        29.2    The  Contractor  does not have an  exclusive  right  under  this
                Agreement to terminate traffic through VoIP technology, and PTCL
                will not be prevented by virtue of this  Agreement from engaging
                any other contractors to provide VoIP services, in Pakistan.

        29.3    VoIP   Platform  will  be  installed  in  PTCL  premises  to  be
                interconnected  to PSTN  network  at  appropriate  levels.  This
                Agreement is strictly for traffic brought into PTCL network from
                USA & Europe  through  the packet  switched  data  communication
                protocol of TCP/IP.

        29.4    PTCL  has  securitized  a  substantial  portion  of  its  future
                receivables from its international  settlement  payments through
                the Securitization Agreement. The Contractor will use reasonable
                efforts to ensure at its own cost and expense  that its entering
                into and its performance of its obligations under this Agreement
                will not  impact  PTCL's  obligations  under the  Securitization
                Agreement.

        29.5    The  Contractor  will provide  free of cost  training to 1 (one)
                PTCL official in USA and 3 (three) PTCL officials in Pakistan so
                that they gain expertise and experience in the operation of VoIP
                Platform.  For the  purpose  of  this  Clause  and  all  matters
                connected  therewith,  the  Contractor or its nominees  shall be
                allowed free access to the premises  where the VoIP  Platform is
                installed. PTCL also undertakes to provide the Contractor or its
                nominees  due access to the VoIP  Platform so that it may,  from
                time to time, to monitor proper functioning or operations of the
                same  including  its   interconnectivity   with  VoIP  Platforms
                installed by Contractor in USA and Europe.

        29.6    The quality of service of calls  routed  through  VoIP  Platform
                shall not be less than GSM quality (MOS 3.5 or above).

        29.7    The  Contractor  shall  at its  own  cost  and  discretion  take
                appropriate legal action in USA & Europe to stop Illegal Traffic
                coming into Pakistan there from.

        29.8    The  Contractor  agrees to  cooperate  with PTCL in  exchange of
                relevant  information for monitoring of the volume and source of
                any  Illegal  Traffic  and

                                     - 27 -
<PAGE>

PAKISTAN

                originating  points to safeguard  interests of both the Parties.
                The  Parties  agree as to the  manner  and the  mechanism  to be
                adopted (on best effort basis).

        29.9    The  Contractor  will  not  enter  into  any  agreement  with an
                Incumbent  Carrier for diversion of normal bilateral  traffic on
                to VoIP routes. The Contractor will not procure or re-file legal
                bilateral traffic of PTCL meaning only gray area traffic will be
                addressed. A list of the Incumbent Carriers is attached herewith
                as Schedule-V.  Any change thereof shall be duly communicated to
                the Contractor.

        29.10   It is mutually  agreed and  understood  that this  agreement  is
                being  executed  on a  non-exclusive  basis.  Nothing  contained
                herein  shall  curtail,  limit or restrict  the right of PTCL to
                enter  into  similar  agreements  with other  parties.  Provided
                always  that  none  of  the  other   parties  shall  be  offered
                commercial terms more beneficial than those contained herein.

        29.11   All  obligations  outside  Pakistan  whether  in  respect of the
                Services  or in  respect  of  incoming  traffic  into  the  VoIP
                Platform  shall be the sole  responsibility  of the  Contractor.
                PTCL  shall  in any way  neither  be  responsible  nor  shall be
                considered  as  providing  any  Service  outside  Pakistan  as a
                consequence of this Agreement. The Contractor hereby indemnifies
                PTCL in respect of any  conclusive  action against PTCL directly
                pertaining  to this  Agreement or the  performance  of its terms
                herein where the action relates to a matter which was the result
                of any direct or indirect act or omission of the contractor.

        29.12   The Contractor  hereby  acknowledges  and declares that it is an
                independent Contractor for the performance of Services mentioned
                herein and no relationship  of Agency,  Licensee or sub Licensee
                between  PTCL and the  Contractor  is  created by virtue of this
                Agreement.

        29.13   The  Contractor  undertakes  to  make,  during  the term of this
                Agreement,  complete  written  disclosure  of its  existing  and
                future  business  and  agreements   executed  relating  to  VoIP
                services,  which  directly or indirectly  lead to termination of
                traffic into Pakistan.

        29.14   The PTCL  shall  have the right to  inspect  the VoIP  Platforms
                installed,  owned  and  operated  by the  Contractor  in USA and
                Europe, which relate to termination of traffic into Pakistan.

                                     - 28 -
<PAGE>

        29.15   The  Parties  recognize  that  time  is of the  essence  of this
                Agreement.

IN WITNESS WHEREOF the Parties have caused this Agreement to be signed as of the
Day and year first above written.

FOR AND ON BEHALF                         FOR AND ON BEHALF OF
OF THE PAKISTAN                           THE CONTRACTOR
TELECOMMUNICATION
                                COMPANY LIMITED

      /s/                                       /s/
------------------------------            ---------------------------------
Noor ud Din Baqai(Member-Technical)       Eric D. Ram, EVP- Int'l
Witnesses:                                Witnesses:

(1)   /s/                                       /s/
   ---------------------------            ---------------------------------
    Ashiq Hussain Javed                       Farrakh Qayyum
    Chief Engineer                            Minister (Trade)
                                              Embassy of Pakistan
                                              Washington, DC

(2)   /s/                                       /s/
   ---------------------------            ---------------------------------
    Iftikhar Ahmad Bashir                     Commercial Assistant
    Legal Advisor                             Washington, DC

                                     - 29 -
<PAGE>

PAKISTAN

                                                                     Schedule -I

                         IP TELEPHONY SOLUTIONS ANALYSIS

TEMPLATE
--------------------------------------------------------------------------------
                                    Hardware
--------------------------------------------------------------------------------
Port Capacity - Analog                       0
--------------------------------------------------------------------------------
Port Capacity-T1/E1                          10 E-1's
--------------------------------------------------------------------------------
A-law / u - law Compatibility                Both
--------------------------------------------------------------------------------
Call Capacity                                300 DSO
--------------------------------------------------------------------------------
PC-Based                                     No
--------------------------------------------------------------------------------
Chassis based with embedded processing       Yes
--------------------------------------------------------------------------------
Architecture Nomenclature - Nuera GX-21 ORCA
--------------------------------------------------------------------------------
Signaling
--------------------------------------------------------------------------------
ANSI/Euro (ITU) ISDN/SS7/C7 and ISUP         Yes
--------------------------------------------------------------------------------
MFC R1/R2                                    Yes
--------------------------------------------------------------------------------
DTMF support                                 Yes
--------------------------------------------------------------------------------
H.323 Fast Connect                           No
--------------------------------------------------------------------------------
Type of Service
--------------------------------------------------------------------------------
Registered Service-Pre-Paid                  No
--------------------------------------------------------------------------------
Registered Service-Post-Paid                 No
--------------------------------------------------------------------------------
Real-Time Fax-T.30                           Yes
--------------------------------------------------------------------------------
T.38 Fax                                     No
--------------------------------------------------------------------------------
Data Calls                                   Yes
--------------------------------------------------------------------------------
Dynamic Universal Port (Voice/Fax/Data)      Yes
--------------------------------------------------------------------------------
Multiple Calling Cards                       No
--------------------------------------------------------------------------------
ANI Authentication                           Yes
--------------------------------------------------------------------------------
Single Stage Dialing                         Yes
--------------------------------------------------------------------------------
Pre-Paid Calling Card                        No
--------------------------------------------------------------------------------
Messaging Services Support                   No
--------------------------------------------------------------------------------
IVR
--------------------------------------------------------------------------------
Language Selection                           N/A
--------------------------------------------------------------------------------

                                     - 30 -
<PAGE>

PAKISTAN

--------------------------------------------------------------------------------
Trouble Announcement                         N/A
--------------------------------------------------------------------------------
IVR Editor                                   N/A
--------------------------------------------------------------------------------
IVR Location                                 N/A
--------------------------------------------------------------------------------
Creation/Billing Per port                    Yes
--------------------------------------------------------------------------------
Redundant Routes                             Yes
--------------------------------------------------------------------------------
Call Routing-Country / Area Code             Yes
--------------------------------------------------------------------------------
Proscribed Number                            ?
--------------------------------------------------------------------------------
Call Block-Destination Number                Yes
--------------------------------------------------------------------------------
Maximum GW / GK Ratio                        N/A
--------------------------------------------------------------------------------
Existing Numbering Plans                     No
--------------------------------------------------------------------------------
Service Classes & User Groupings             ?
--------------------------------------------------------------------------------
Location of Routing Logic                    Excel Switch
--------------------------------------------------------------------------------
Call Progress Signals
--------------------------------------------------------------------------------
Ring back, Busy Tone                         Yes
--------------------------------------------------------------------------------
Timer for Inter Digit, First-digit, No       Yes
Answer
--------------------------------------------------------------------------------
Maximum latency

  o   End-to-end
                                             < 400 MS
  o   Element wise
                                             ?
--------------------------------------------------------------------------------
5.    Billing
--------------------------------------------------------------------------------
Authentication (User/Subscriber)             No
--------------------------------------------------------------------------------
Billing Data Creation per Gateway            Yes
--------------------------------------------------------------------------------
Central Billing Data Storage                 Yes
--------------------------------------------------------------------------------
Retransmit Billing Data During Link Failure  N/A
--------------------------------------------------------------------------------
Rating by Country / Area                     Yes
--------------------------------------------------------------------------------
Automatic Rate Change                        Yes
--------------------------------------------------------------------------------
Real-Time Billing                            No
--------------------------------------------------------------------------------
No Charge Function for Small Fraction Call   Yes
--------------------------------------------------------------------------------
Standard DB for Billing Storage              Yes
--------------------------------------------------------------------------------
Multiple Rates / Route                       Yes
--------------------------------------------------------------------------------
Drop-Off Rates                               ?
--------------------------------------------------------------------------------

                                     - 31 -
<PAGE>

PAKISTAN

--------------------------------------------------------------------------------
Billing Increments

                                             Programmable
--------------------------------------------------------------------------------
Billing based on Units or Money              Money
--------------------------------------------------------------------------------
Holiday Rates                                Yes
--------------------------------------------------------------------------------
Grace Period                                 ?
--------------------------------------------------------------------------------
Billing Answer After Egress                  ?
--------------------------------------------------------------------------------
Network Management
--------------------------------------------------------------------------------
SNMP MIB                                     Yes
--------------------------------------------------------------------------------
Fault Monitoring                             Yes
--------------------------------------------------------------------------------
Performance Statistics                       Yes
--------------------------------------------------------------------------------
Command Line Interface                       Yes
--------------------------------------------------------------------------------
Web-based Management                         Yes
--------------------------------------------------------------------------------
SS7
--------------------------------------------------------------------------------
Physical Interfaces                          Yes
--------------------------------------------------------------------------------
Redundant Link                               No
--------------------------------------------------------------------------------
# Point Codes Supported                      Yes
--------------------------------------------------------------------------------
Signaling Level                              Lvl 4 ISUP
--------------------------------------------------------------------------------
Standalone Processor                         Yes
--------------------------------------------------------------------------------
Embedded Processor                           Yes
--------------------------------------------------------------------------------
Transport Protocol Suit
--------------------------------------------------------------------------------
H.323                                        Yes
--------------------------------------------------------------------------------
Support for Industry standard H.323 Clients  No
--------------------------------------------------------------------------------
TCP/IP                                       Yes
--------------------------------------------------------------------------------
UDP                                          Yes
--------------------------------------------------------------------------------
RTP/RTCP                                     Yes
--------------------------------------------------------------------------------
RSVP                                         No
--------------------------------------------------------------------------------
SIP                                          Yes
--------------------------------------------------------------------------------
MGCP                                         Yes
--------------------------------------------------------------------------------
  o   Interfacing / Inter-working With IP-Backbone
--------------------------------------------------------------------------------
ATM                                          N/A
--------------------------------------------------------------------------------

                                     - 32 -
<PAGE>

PAKISTAN

--------------------------------------------------------------------------------
Frame Relay                                  N/A
--------------------------------------------------------------------------------
IP                                           Yes
--------------------------------------------------------------------------------
Other
--------------------------------------------------------------------------------
Secure Administration                        No
--------------------------------------------------------------------------------
Secure Voice                                 Yes
--------------------------------------------------------------------------------
APIs                                         Yes
--------------------------------------------------------------------------------
Codecs Supported                             G.711, G.723, G.726, G.729, GSM,
                                             ECELP
--------------------------------------------------------------------------------
Compression Algorithm Scalability            8Kbps-64 Kbps
--------------------------------------------------------------------------------
Built-In Inter-connection Capability for     No
Traffic Sharing
--------------------------------------------------------------------------------

                                     - 33 -
<PAGE>

PAKISTAN

                                                                    Schedule -II
Platform Connectivity Topology Diagram

                               [GRAPHIC OMITTED]

                                     - 34 -
<PAGE>

PAKISTAN

                                                                    Schedule-III
                                                                    ------------

     ANNUAL INTERNATIONAL INCOMING MINUTES (IN MILLIONS) FROM USA AND EUROPE
     -----------------------------------------------------------------------

--------------------------------------------------------------------------------
         Actual Incoming Traffic (Million Minutes)            Forecast Traffic
--------------------------------------------------------------------------------
S/No. COUNTRY     96-97    97-98    98-99    99-00    00-01     01-02    02-03
--------------------------------------------------------------------------------
1. USA           170.528  178.346  199.907  273.997  359.243   405.945  458.718
--------------------------------------------------------------------------------
2. EUROPE         92.400  109.987  151.167  217.026  183.844   207.744  234.751
--------------------------------------------------------------------------------
   USA + Europe  262.928  288.333  351.073  491.023  543.088   613.689  693.468
   -----------------------------------------------------------------------------

                                [GRAPHIC OMITTED]

                                     - 35 -
<PAGE>

PAKISTAN

                                                                     Schedule-IV

ACCOUNTING AND METHOD OF SETTLEMENT
-----------------------------------

a)      Fortnightly traffic account and methods of settlement

        i)      Within 2 (two) days from the end of every fortnight to which the
        account  relates,  PTCL will prepare a fortnightly  accounts  settlement
        statement  in a format  designed by PTCL in its  discretion  showing the
        balances  from the  fortnightly  accounts  to which it relates and shall
        send the same to the  Contractor.  The  contractor  shall  make  payment
        within seven days of  transmission  of invoice as provided in clause-11.
        In  the  event  of  dispute  between  the  Parties  and  subject  to the
        provisions of Clause 11, the  Contractor  shall still be obliged to make
        payment by the Due Date in accordance with PTCL's  fortnightly  accounts
        settlement statement in the Designated Account.

        ii)     In case the  Contractor  fails to make  the  payment  by the Due
        Date,  then PTCL may, at its sole  discretion  having provided four days
        prior notice in writing (during which period,  Contractor may remedy the
        breach and prevent  termination  of the  Agreement),  to the  Contractor
        terminate the Agreement without prejudice to any other interest or claim
        that may have  accrued  in  favour  of PTCL or to which  PTCL may in the
        future be entitled to under the Agreement.

b)      ROLLING ADVANCE CALCULATION FOR THIRTY (30) DAYS & APPLICABILITY

        The Contractor shall deposit in the Designated  Account an amount of US$
        570,000  (Five hundred and seventy  thousand  US$) i.e. the  termination
        price of 3 million  minutes  (minimum  traffic for thirty days) per VoIP
        Platform @ US$ 0.19 (US cents nineteen) per minute within 15 days of the
        Effective  Date.  This is the minimum amount of rolling  advance for the
        commencement of VoIP Service, rolling advance for subsequent months will
        be calculated for a minimum of 3 (three) million  Terminated Minutes per
        month for one month (30 days) at the applicable rate.

Topping Up/Down Procedure
-------------------------

        In case, the per month per VoIP Platform site termination  traffic rises
        above 3 (three)  million  minutes,  the 30 (thirty) days Rolling Advance
        shall be increased by the Contractor pro-rata over and above the minimum
        amount  specified  above. If the traffic through any VoIP Platform is in
        excess of 3 (three) million minutes per month per site, within 7 (seven)
        days  following  the end of such  month,  the Rolling  Advance  shall be
        topped  up and  if  decreases  will  be  topped  down  according  to the
        following procedure:

                i.      PTCL shall determine the traffic for the preceding month
                        on the basis of data  available to PTCL.  The  recording
                        and  accounting  shall be a  permanent  feature for each
                        succeeding month during the currency of the Agreement.

                ii.     PTCL shall give notice to the  Contractor to deposit the
                        additional  amount  determined  by  PTCL  to  top up the
                        Rolling  Advance  and  accordingly  the PTCL  shall make
                        payment  to the  contractor  to  top  down  the  rolling
                        advance,  as a result of traffic recorded in PTCL system
                        according to the following example:

                                     - 36 -
<PAGE>

PAKISTAN

        EXAMPLE FOR CALCULATION OF ROLLING ADVANCE
        ------------------------------------------

        Final  schedule  to be  prepared  and  will be  attached  at the time of
        contract signing,  however an example to demonstrate the calculation for
        seven months is as under;

                         ROLLING ADVANCE (AMOUNT IN US$)
--------------------------------------------------------------------------------
     MONTH      TERMINATED  MINUTES    RATE      AMOUNT      RECEIPT    MONTHLY
                  MINUTE    FOR        PER     INCREASED/  /(ADJUSTED)  BALANCE
                            TOPPING    MINUTE   DECREASE     AMOUNT
                            UP/(DOWN)
--------------------------------------------------------------------------------
Initial advance   3 MM          --      0.19          --     570,000    570,000
--------------------------------------------------------------------------------
TOPPING-UP/ (DOWN)
--------------------------------------------------------------------------------
    Month-1        2MM          --        --          --          --    570,000
--------------------------------------------------------------------------------
    Month-2        3MM          --        --          --          --    570,000
--------------------------------------------------------------------------------
    Month-3        4MM         1MM       0.19    190,000          --    570,000
--------------------------------------------------------------------------------
    Month-4        5MM         1MM       0.19    190,000     190,000    760,000
--------------------------------------------------------------------------------
    Month-5        5MM          --        --          --     190,000    950,000
--------------------------------------------------------------------------------
    Month-6        4MM        (1MM)      0.19   (190,000)         --    950,000
--------------------------------------------------------------------------------
    Month-7        3mm        (1MM)      0.19   (190,000)   (190,000)   760,000
--------------------------------------------------------------------------------

                iii.    Within 7 (seven)  days after the  issuance  date of such
                        notice from PTCL, the  Contractor  shall make payment of
                        the  incremental   amount  notified  by  PTCL  into  the
                        Designated Account.

                iv.     In  case  the  Contractor  fails  to top up the  Rolling
                        Advance as set forth above,  PTCL  reserves the right to
                        terminate the Agreement forthwith.

        c)      Traffic    Dilution    Compensation    amount    calculation   &
                Reconciliation Procedure

        Subject to and as limited by Section 12.2.2 of this  Agreement,  for any
        month the  Contractor  will be liable  to pay PTCL  compensation  if the
        international  traffic from the USA and Europe routed  through  non-VoIP
        routes not utilizing the VoIP Platform, falls below the average that may
        have been expected in such month from such area, such averages (allowing
        for the  expected  13% annual  increase  in  volume)  being set forth in
        Schedule-III   hereto   for  the  USA  and  Europe   collectively.   The
        compensation  amount  for each  month  shall be the number of minutes by
        which  the  traffic  falls  below  the  average  multiplied  by  carrier
        settlement  rate minus  Contractor  settlement  rate.  The  compensation
        figure will be calculated  monthly  following  the Service  Commencement
        Date  to  determine  if any  compensation  amount  is  payable  to  PTCL
        hereunder  and if so what  amount.  The  compensation  amount  shall  be
        payable by the Contractor to PTCL along with its fortnightly  bill given
        in Clause  11.  PTCL's  calculation  of the same shall be binding on the
        Contractor.  The Rolling Advance will be adjusted  against  compensation
        amounts  due from the  Contractor  and  following  such  adjustment  the
        Contractor will be liable forthwith to top up the Rolling Advance.

                                     - 37 -
<PAGE>

PAKISTAN

In case the Contractor fails to pay the compensation  amount claimed or fails to
top up the Rolling  Advance as set forth above.  The method for  calculation  of
compensation for dilution of bilateral traffic is provided hereunder:

        i)      In order to setup  mechanism  to safeguard  against  dilution of
                PTCL   legal    incoming    traffic,    such   traffic    growth
                statistics/statement   and  graphs  for  last  five  years  with
                established   compound  annual  growth  (CAGR)  are  annexed  as
                Schedule-III.  The benchmark  line so  established  would be the
                basis of control mechanism against dilution of legal traffic for
                the purpose of application of relevant  clauses.  The statistics
                and  graph  also  include  traffic  variation  patterns  such as
                seasonal  trends.  Any variation of (-) 5% VoIP measured traffic
                from USA and Europe  over the  benchmark  line (and  established
                seasonal  pattern) would be the basis of application of relevant
                clause for determining the dilution of legal traffic.

        ii)     To safeguard  PTCL's  aforesaid legal  benchmark-line  including
                growth,  PTCL will provide monthly data in specified  pattern to
                the  Contractor  for  information  about any  variation.  If the
                variations   are  within  (-)  5%  limit  of  VoIP   traffic  no
                compensation shall be payable by the Contractor.

        iii)    In case of variation over (-) 5% limit of the minimum guaranteed
                (three million) VoIP traffic INTER ALIA the following corrective
                and remedial measures would become necessary:

                A.      The Parties will analyze the reasons for  variation  and
                        mutually agree on corrective  measures within time limit
                        of one week. If reasons of variation are due to seasonal
                        or  temporary  in nature then no  compensation  shall be
                        payable by the Contractor.

                B.      If the reasons for  variation are found to be beyond the
                        control of both the Parties,  the Parties  shall equally
                        share  the loss of  traffic.  For  avoidance  of  doubt,
                        Contractor's liability in this regard will be restricted
                        to US Cents 4 per minute (that is:  bilateral rate minus
                        VoIP rate, which is US Cents 23 .00 minus US Cents 19.00
                        ,  equal to US Cents 4 ) until  revision  of US  carrier
                        settlement rate (bilateral  carrier rate) of the diluted
                        traffic.

                C.      In case of continuous  variation  over a period of three
                        monthly  the  Parties  may   exercise   their  right  of
                        termination.

d)      Charges & Conditions to terminate Incoming Traffic in VoIP Platform

        i)      Only traffic from  USA/Europe  shall be  terminated  through the
                VoIP  Platform.  Contractor  hereby  agrees to  terminate 3 to 5
                million minutes per month of VoIP Platform focusing on capturing
                of Illegal Traffic.

        ii)     Termination rate of US$ 0.19 (US cents nineteen) per minute will
                be  applicable  until  revision  of US carrier  settlement  rate
                (bilateral carrier rate) . Subsequent  termination rate would be
                kept up to 15% below the US Carrier  Settlement  Rate (bilateral
                carrier rate) and the same shall be automatically revised inline
                with US Carrier Settlement Rate.

                                     - 38 -
<PAGE>

        iii)    The  VoIP   service   shall  be  operated   only  for   incoming
                international  calls  from  the USA  and  Europe  routed  as per
                network topology agreed between the Parties.

The Contractor will ensure that only identified calling party is given access to
VoIP Gateway. The CDR provided to PTCL as per Clause 11(ii) must also contain
identity of calling party. Up to (twenty-five) 25% un-identified calling numbers
will be accepted and no further investigation carried out.

                                     - 39 -
<PAGE>

PAKISTAN

                                                                      Schedule-V

               List of Incumbent Carriers in USA and Europe

               USA

               ------------------------------------------------------
               S No.    Country         Carrier
               ------------------------------------------------------
               1        USA             Concert
               ------------------------------------------------------
               2        USA             MCI World Com
               ------------------------------------------------------
               3        USA             Sprint USA
               ------------------------------------------------------

               Europe

               ------------------------------------------------------
               S No.    Country         Carrier
               ------------------------------------------------------
               1        Austria         Austria- (PTA)
               ------------------------------------------------------
               2        Belgium         Belgacom
               ------------------------------------------------------
               3        Cyprus          CTA
               ------------------------------------------------------
               4        Germany         Deutsche Telecom
               ------------------------------------------------------
               5        France          France Telecom
               ------------------------------------------------------
               6        Greece          OTE
               ------------------------------------------------------
               7        Italy           Telecom Italia
               ------------------------------------------------------
               8        Norway          Tele nor
               ------------------------------------------------------
               9        Spain           Telephonica
               ------------------------------------------------------
               10       Netherlands     KPN
               ------------------------------------------------------
               11       Switzerland     Swiss Com
               ------------------------------------------------------
               12       United Kingdom  Concert
               ------------------------------------------------------
               13       United Kingdom  C & WC
               ------------------------------------------------------

                                     - 40 -
<PAGE>

PAKISTAN

                                   SCHEDULE VI
                      Programme of commitments (Milestones)
                                    OPTION II

  IMPLEMENTATION SCHEDULE FOR VOIP PROJECT THROUGH PAKISTAN INTERNET EXCHANGE
  ---------------------------------------------------------------------------

--------------------------------------------------------------------------------
   S.NO   Description of Task               Action to be      Responsibility
                                            completed by
--------------------------------------------------------------------------------
    1     Signing of the Agreement          1st Day           PTCL & Contractor
--------------------------------------------------------------------------------
    2     Submission of list,               7th Day           Contractor
          specification & site plan of
          the equipment
--------------------------------------------------------------------------------
    3     Equipment Approval                14th Day          PTCL
--------------------------------------------------------------------------------
    4     Availability of                   14th Day          PTCL
          Air-Conditioned space and
          commerical power supply in
          accordance with the site plane
--------------------------------------------------------------------------------
    5     Confirmed Deposit of Rolling      15th Day from     Contractor
          Advance                           the Effective
                                            Date
--------------------------------------------------------------------------------
    6     Provision of 8 E1s for            24th Day          PTCL
          connectivity between DTE and
          VoIP platform, 2.5 MB clear
          channel via PIE and Data fill
          in the DTE should be ready
          including software and
          hardware configerd 100%
          guranted to interconnect with
          Contractor VoIP platform
--------------------------------------------------------------------------------
    7     Equipment on site                 28th Day          Contractor
--------------------------------------------------------------------------------
    8     Equipment installation            30th Day          Contractor
          completed
--------------------------------------------------------------------------------
    9     Testing & commissioning           32nd Day          PTCL &
          completed                                           Contractor
--------------------------------------------------------------------------------
    10    Service commencement              35th Day          Contractor
--------------------------------------------------------------------------------
    11    Local Training                    60th Day          PTCL & Contractor
--------------------------------------------------------------------------------
    12    Foreign Training                  70th Day          Contractor
--------------------------------------------------------------------------------

                                     - 41 -
<PAGE>

PAKISTAN

         IMPLEMENTATION SCHEDULE FOR VOIP PROJECT THROUGH IPLC EXCHANGE
         --------------------------------------------------------------

--------------------------------------------------------------------------------
   S.NO   Description of Task               Action to be      Responsibility
                                            completed by
--------------------------------------------------------------------------------
    1     Signing of the Agreement          1st Day           PTCL & Contractor
--------------------------------------------------------------------------------
    2     Submission of list,               7th Day           Contractor
          specification & site plan of
          the equipment
--------------------------------------------------------------------------------
    3     Equipment Approval                14th Day          PTCL
--------------------------------------------------------------------------------
    4     Availability of                   14th Day          PTCL
          Air-Conditioned space and
          commerical power supply in
          accordance with the site plane
--------------------------------------------------------------------------------
    5     Confirmed Deposit of Rolling      15th Day from     Contractor
          Advance                           the Effective
                                            Date
--------------------------------------------------------------------------------
    6     Provision of 8 E1s for            24th Day          PTCL
          connectivity between DTE and
          VoIP platform, 2.5 MB clear
          channel via PIE and Data fill
          in the DTE should be ready
          including software and
          hardware configerd 100%
          guranted to interconnect with
          Contractor VoIP platform
--------------------------------------------------------------------------------
    7     Equipment on site                 28th Day          Contractor
--------------------------------------------------------------------------------
    8     Equipment installation            30th Day          Contractor
          completed
--------------------------------------------------------------------------------
    9     Testing & commissioning           32nd Day          PTCL & Contractor
          completed
--------------------------------------------------------------------------------
    10    Service commencement              35th Day          Contractor
--------------------------------------------------------------------------------
    11    Local Training                    60th Day          PTCL & Contractor
--------------------------------------------------------------------------------
    12    Foreign Training                  70th Day          Contractor
--------------------------------------------------------------------------------

TO BE CHANGED BY AMENDMENT

                                     - 42 -EXHIBIT 10.5
                                  ------------
                             JOINT VENTURE AGREEMENT
                             -----------------------

              THIS JOINT VENTURE AGREEMENT (the "Agreement") is made and entered
into as of the 12th day of December 2002, by and between Karamco, Inc. ("Karam")
and Telecommunications Overseas Fusion Ltd ("TOFL") (collectively, the
"Members").

              The Members shall organize a joint venture, in the form of a
FZ-LLC company ("FZ-LLC") in Dubai Technology, Electronic Commerce & Media Free
Zone, Dubai, United Arab Emirates, to be known as Efonica FC-LLC, to be owned
fifty and two tenths ( 50.2%) percent by TOFL and forty nine and eight tenths
(49.8%) percent by Karam, in order to develop, provide and market certain
telecommunications services and to engage in other activities as set forth
herein.

              NOW, THEREFORE, in consideration of the mutual covenants and
agreements herein contained, and other good and valuable consideration, the
Members hereby agree as follows:

                                    ARTICLE I
                                    ---------
                          ESTABLISHMENT OF THE COMPANY
                          ----------------------------

       1.1    FORMATION. The Members hereby associate themselves as a FZ company
(FZ-LLC) in Dubai Technology, Electronic Commerce & Media Free Zone to be known
as Efonica FC-LLC for the purposes and upon the terms and conditions set forth
in this Agreement. The Managers (as such term is defined in Section 6.1 of this
Agreement) shall promptly take all actions necessary or appropriate to allow the
Company to carry on its business in accordance with the terms of this Agreement,
including, but not limited to executing and filing: (a) a Certificate of
Formation in the form of Exhibit A hereto with Dubai Technology, Electronic
Commerce and Media Free Zone, Dubai, United Arab Emirates; and (b) such other
documents as Dubai Technology, Electronic Commerce and Media Free Zone, Dubai,
United Arab Emirates may require for the formation, qualification and operation
of the Company.

       1.2    NAME. The name of the Company is Efonica FZ-LLC or such other name
selected by the Managers as may be acceptable to the appropriate recording
officials of Dubai Technology, Electronic Commerce and Media Free Zone, Dubai,
United Arab Emirates. The Members agree that the Company's use of any trademark
or name owned by either of the Members shall not create any trademark ownership
or other right of the Company with respect to such trademark or name.

       1.3    PURPOSE. The purpose of the Company is to jointly: (i) market,
promote, distribute and provision PC to Phone services originated over a PC or
other network-compatible hardware devices as mutually agreed upon; and pre- and
post-paid card services as marketed to the Company's customers worldwide
(hereinafter the "Services"); (ii) carry on all activities necessary

                                     - 1 -
<PAGE>

or incidental to that purpose; and (iii) engage in all other lawful acts or
activities for which FZ-LLC companies may be formed in Dubai, United Arab
Emirates.

       (a)    EXCLUSIVE. During the Term of this Agreement, and with the
exception of the market in India, relating to an existing agreement between
Fusion and Estel Telecommunications, the Members agree to an exclusive marketing
and service arrangement for the provision, sale and distribution of PC to Phone
services. Any and all termination services will be provided exclusively through
the TOFL, or any of its affiliates' network or through any such arrangements as
the Managers may determine to be most efficient.

       (b)    NON-EXCLUSIVE. The Members agree that there shall not be exclusive
marketing and service arrangements for the provision of (i) travel card
services; (ii) corporate communications services; or (iii) telecommunications
hardware.

       1.4    POWERS. The Company shall have the power to do all things
necessary or desirable in the conduct of its business to the fullest possible
extent, including but not limited to the power to: (a) acquire, hold and dispose
of any and all property, whether real, personal or mixed, and any interest
therein or appurtenances thereto; (b) borrow money for Company purposes; if
security is required therefore, to mortgage, pledge or subject to any security
arrangement any and all property of the Company; (c) hold record title to assets
of the Company for any purpose convenient or beneficial to the Company; (d)
enter into any contract necessary and proper for the business of the Company or
its property or for any purpose beneficial to the Company; (e) retain or employ
from time to time, at the Company's expense, persons, firms or corporations,
including professional advisors, whether or not affiliated with the Members or
either of them for the operation, management and further development of the
business of the Company; and (f) execute and deliver on behalf of the Company,
notes, bonds or other evidences of indebtedness, security arrangements of any
kind or nature, leases, contracts or agreements and any or all other documents
or instruments necessary to effectuate the exercise of the foregoing powers and
to guarantee the performance of any such instrument or agreement.

       1.5    PRINCIPAL PLACE OF BUSINESS. The principal place of business of
the Company in Dubai shall be Dubai Internet City, Bldg. 9, Offices G02 and G03,
Dubai, UAE.

       1.6    BUSINESS PLAN: The Managers shall adopt the business plan attached
as Exhibit "C". ARTICLE II

                                     MEMBERS

       2.1    MEMBERS. The names and addresses of the Members are:

KARAMCO INC.
DOT LB Ctr., 9th Floor
Dekwaneh, Beirut - Lebanon
Telephone +9611 511811 / Facsimile +1-212-214-0642

                                     - 2 -
<PAGE>

TELECOMMUNICATIONS OVERSEAS FUSION LTD
Suite 410
4th Floor
Barkly Wharf, Le Caudan Waterfront
Port Louis, Mauritius

       2.2    INTERESTS. Each Member shall have a voting interest in the
decisions of the Company equal to its pro rata equity ownership.

                                   ARTICLE III
                                   -----------
                        BOOKS AND RECORDS OF THE COMPANY
                        --------------------------------

       3.1    COMPANY ACCOUNTING.

              (a)    FINANCIALS: The Company will furnish the Members with an
       unaudited balance sheet, income statement, statement of cash flow and
       changes in Members' equity within 15 days after the end of each month.
       The Company shall establish and maintain financial accounting books and
       records in accordance with generally accepted accounting principles as
       applied in the United States ("GAAP"). At the end of each fiscal year of
       the Company, a firm of independent public accountants ("Accountants")
       selected by the Managers shall review the Company's income tax returns,
       and any other annual tax returns required to be filed. The Accountants
       shall also perform an audit of the Company's records and accounts for
       such fiscal year, and prepare a report, including their opinion, of the
       Company's financial statements and required footnote disclosures.

              (b)    BUDGET: An annual budget will be submitted to the Managers
       for review and approval. Actuals against budget will be monitored and
       variances reviewed by the Managers on a monthly basis. Non-Budgeted
       expenses will be subject to financial review and approved by the Managers
       in writing.

       3.2    BOOKS AND RECORDS. The books and records of the Company shall at
all times be maintained at the principal office of the Company and shall be open
to inspection, examination, and copying by either of the Members or their duly
authorized representatives during normal business hours. Upon written request of
any Member, the Managers shall send full and exact copies of the books and
records of the Company.

       3.3    FISCAL YEAR. Unless otherwise agreed upon by the Members, the
fiscal year of the Company shall be the same as its taxable year, which shall be
the same as the calendar year.

       3.4    TAX RETURNS. The Company shall make such tax elections and tax
policy decisions as determined by the Managers. It is the intention of the
Members that such elections and decisions shall not be influenced by the unique
tax position of one Member absent the approval of the other Member. The Company
shall cause to be prepared and timely filed any applicable income, franchise
sales and use, property, payroll and other tax returns for the Company. Forms of

                                     - 3 -
<PAGE>

such returns shall be submitted to the Members for review and final approval no
later than 5 calendar days before their due date. Copies of final returns shall
be sent to the Members promptly after filing. Each Member shall notify the
Company and the other Member promptly upon receipt of any notice of any tax
examination by any taxing authority pertaining to the Company or any of the
Members. No settlement of any tax issue concerning the Company shall be made by
any Member except after reasonable coordination with the Managers. The Members
agree that TOFL shall serve as the Tax Matters Member.

                                   ARTICLE IV
                                   ----------
              INITIAL CAPITAL CONTRIBUTIONS AND ADDITIONAL FUNDING
              ----------------------------------------------------

       4.1    ADVANCES. TOFL shall make an initial advance to the Company in the
amount of $70,000 for the first month of operation and up to $70,000 per month
to cover any operating deficit for the following two months. As of the date of
this Agreement, the Members acknowledge TOFL has already advanced $15,000. Out
of the advance to Efonica, Roger Karam shall be authorized to get reimbursement
for expenses already incurred by DOT-LB for Gitex and related expenses amounting
to $29,947.56. Such advance is not to be considered a contribution to the
capital of the Company but shall be treated as a loan. Such advance shall be
repaid over the course of 24 months beginning the first month the Company
generates a profit and taken from COLLECTED receipts prior to profit
distribution or May 2003, whichever is sooner. In consideration for the advance
by TOFL, the Company shall enter in a promissory note(s) and security
agreement(s), securing the receivables of the Company. A copy of the promissory
note and security agreement shall be attached as Exhibit "B". In addition to
such advance, each Member may, but shall not be required to, advance funds to
the Company. Any such advances shall not be considered contributions to the
capital of the Company, unless pre-approved in writing by the Members, but shall
be treated as loans thereto and shall be made under such terms as may be agreed
upon by the Managers.

       4.2    ADDITIONAL CONTRIBUTIONS. If the Managers jointly determine that
(i) additional funds are required to carry out the purposes of the Company, (ii)
the contribution of such funds by the Members is commercially advisable, and
(iii) such funds are not obtainable from other sources on acceptable terms, then
the Members shall consider in good faith the provision of such additional
funding in proportion to each Member's respective Percentage Interest as defined
in Section 5.2 below (such funding to be made in the form of capital
contributions or as debt on such terms as are determined by the Managers).
However, neither Member shall be required to make any additional capital
contributions to the Company and in no event shall either Member contribute
additional funds or compel the other Member to contribute additional funds to
the Company unless mutually agreed by both Members.

                                     - 4 -
<PAGE>

                                    ARTICLE V
                                    ---------
                          PROFIT AND LOSS/DISTRIBUTIONS
                          -----------------------------

       5.1    ALLOCATION OF PROFITS AND LOSSES. After deducting for any advances
made to the Company and direct costs of the Company's operations, including any
applicable taxes, and providing for a reasonable operating reserve, the Managers
shall allocate profits and losses of the Company to the Members on an equal
basis.

       5.2    DISTRIBUTIONS. The profits, if any, of the Company shall be
distributed to the Members on a quarterly basis. The amount of any such
distributions shall be agreed upon by the Managers and shall be distributed 50%
Karam and 50% TOFL.

       5.3    TAX WITHHOLDING. The Company is authorized to and shall withhold
and pay over all amounts required to be withheld pursuant to Dubai Technology,
Electronic Commerce and Media Free Zone, Dubai, United Arab Emirates or pursuant
to any provision of any state or local tax law with respect to any payment or
distribution or any allocation of income to any Member. Such withheld amounts
shall be treated as distributions to the Member in question for all purposes of
this Agreement.

                                   ARTICLE VI
                                   ----------
                            MANAGEMENT OF THE COMPANY
                            -------------------------

       6.1    APPOINTMENT OF BOARD OF MANAGERS. The Members shall jointly
discuss and mutually determine the long-term goals, objectives and policies of
the Company. The Members shall exercise control over the business affairs of The
Company through three appointed managers (the "Managers"). The initial Managers
shall be Matthew Rosen, Joel Maloff and Roger Karam. Initially and until his
resignation, Matthew Rosen shall be the Chairman and Roger Karam shall be the
President. The Managers shall have such powers and duties to manage and control
the business and affairs of the Company as the Members shall assign to them.
However, neither of the Members nor any officer, director, employee or agent of
either Member (unless designated by the Member as the Manager) shall direct,
supervise or take any action, in the name of or on behalf of the Company.

       6.2    LIABILITIES OF THE MANAGERS; OTHER INTERESTS. The Managers and
their agents shall not be liable to the Company or to any of the Members for any
acts performed or omitted to be performed in good faith, for errors in judgment,
or for other acts or omissions not amounting to fraud, gross negligence or
willful misconduct. The Company shall fully indemnify and hold harmless the
Managers and Members and their agents from any losses or liabilities resulting
from acts or omissions taken by them on behalf of the Company and in furtherance
of the Company's interests. Except as set forth in this Agreement, the Managers
may engage in or possess interests in other business ventures of every nature
and description, whether or not competitive with the

                                     - 5 -
<PAGE>

business of the Company, independently or with others, and neither the Company
nor any of its Members shall, by virtue of this Agreement, have any rights in
such other ventures or the income or profits derived therefrom.

       6.3    LIMITED LIABILITY OF THE MEMBERS. Notwithstanding any provision of
this Agreement, the Members shall not be personally liable for any of the
losses, debts or liabilities of the Company, except as otherwise expressly
provided by law. Except as set forth in Section 4.2 no Member shall be required
to make capital contributions to the Company to eliminate capital account
deficits or for any other purpose, either upon dissolution of the Company or at
any other time. Except as set forth in Article X, if applicable, the Members may
engage in or possess interests in other business ventures of every nature and
description, whether or not competitive with the business of the Company,
independently or with others, and neither the Company nor any of its other
Members shall, by virtue of this Agreement, have any rights in such other
ventures or the income or profits derived therefrom.

       6.4    AGREEMENTS WITH THE COMPANY. The Company shall not enter into any
significant transaction, including, without limitation, the purchase, sale or
exchange of property or the rendering of any service, with any entity in which
either Member (or any affiliate of either Member) has any interest, except (i)
on an arms-length basis, or (ii) as specifically approved by both Members. With
respect to any agreement between the Company and one of the Members, termination
of such agreement based upon a breach, default or other action, inaction or
condition of such contracting Member shall be made in the sole determination,
and with the sole approval, of the non-contracting Member.

              In consideration for management services rendered to the JV, Roger
Karam will receive minimum monthly compensation of 10% of monthly collected
revenue, not to exceed $15,000 per month, paid monthly within 15 days of the
month's close. Any deficiency in funds available for such payment will be made
out of the combined budgetary allocation for third party distribution and direct
sales bonuses and commissions.

       6.5    DEADLOCK. In the event that the Managers are unable to agree on a
particular course of action for the Company and become deadlocked, they shall
immediately give notice of the deadlock to the Members. Within three business
days of receiving notice of the deadlock, each Member shall appoint two other
persons to serve as mediators to attempt to resolve the deadlock. If the
mediators are unable to resolve the deadlock within 15 business days of their
appointment, the Company shall proceed with dissolution pursuant to Section
8.3(c).

                                   ARTICLE VII
                                   -----------
                             WITHDRAWAL AND TRANSFER
                             -----------------------

       7.1    RESTRICTIONS ON TRANSFERS. Neither Member shall transfer or
encumber any Interest in the Company or any of such Member's rights under this
Agreement without the approval of the other Member, except as expressly
permitted by this Agreement. Any purported transfer to

                                     - 6 -
<PAGE>

a third party of a Member's Interest not permitted by this Section 7 shall be
void, and shall not be recognized by or effective against the Company or the
other Member.

       7.2    TRANSFERS TO AFFILIATES. Notwithstanding the provisions of Section
7.1 hereof, a Member may transfer all or part of its Interest in the Company to
an Affiliate of such Member. For purposes of this Section 7.2, an Affiliate
shall mean an entity that is controlled by, or under common control with, a
Member. Prior to transferring any Interest to an Affiliate, the transferring
Member shall notify the other Member in writing and, at the request of the other
Member, shall require that such Affiliate become a party to this Agreement.

       7.3    PERMITTED THIRD-PARTY TRANSFERS. No Member may transfer any part
of its Interest in the Company unless the transfer is either: (a) a permitted
transfer of all of the Member's Interest under Section 7.2 hereof; or (b) made
to a Permitted Transferee subject to the Right of First Refusal provided in
Section 7.4 hereof. For purposes of this Agreement, a "Permitted Transferee"
means an unaffiliated third party who is approved to become a member due to the
other Member's decision not to exercise the right of first refusal granted in
Section 7.4 hereof.

       7.4    RIGHT OF FIRST REFUSAL; DISAPPROVAL RIGHT. If a Member desires to
transfer a portion or all of its Interest in the Company to a non-Affiliate, the
Member must first comply with the Right of First Refusal provisions of this
Section 7.4.

       (A)    NOTICE OF OFFER. If a Member has received and wishes to accept a
BONA FIDE offer for the purchase all or a portion of its Interest then such
Member (the "Selling Member") shall first deliver written notice (the "Notice of
Offer") of such intent to the other Member, including (1) the name and address
of the proposed purchaser; (2) the price at which such Selling Member proposes
to sell such Interest (the "Offer Price"); (3) the other terms of the proposed
sale; and (4) that the prospective purchaser has offered to purchase the
Interest for the Offer Price and on the stated terms. The Selling Member shall
provide as promptly as practicable upon request any other information reasonably
requested in order for the other Member to make an informed decision whether to
exercise its purchase or sale rights described below. The Notice of Offer shall
constitute an irrevocable offer by the Selling Member to either: (a) sell the
Interest to the other Member; or (b) if requested by the other Member, to
purchase all or a portion of the Interest of the other Member at the Offer
Price.

       (B)    OTHER MEMBER ACCEPTANCE OR REJECTION. The other Member shall have
the right for a period of 30 calendar days after receipt of the Notice of Offer
to notify (a "Notice of Acceptance") the Selling Member that such other Member
has determined to: (a) purchase all or less than all, of the Selling Member's
Interest; (b) sell all or less than all, of its Interest to the Selling Member
at the Offer Price; or (c) object to the proposed purchaser for any of the, in
which case the non-Selling Member must provide written notice to the Selling
Member specifying the reasons for such disapproval.

       (C)    FAILURE TO PROVIDE TIMELY NOTICE OF ACCEPTANCE OR REJECTION. If
the non-Selling Member does not timely deliver a Notice of Acceptance or
Rejection to the Selling Member within the period specified in Section 7.4(b)
above, the Selling Member (1) shall be under no obligation

                                     - 7 -
<PAGE>

to sell any of its Interest to the other Member, and (2) may, during a period of
an additional 30 calendar days, transfer its Interest to the proposed purchaser
specified in the Notice of Offer at a price not less than the Offer Price and on
such other terms and conditions as are no more favorable to the proposed
purchaser than those specified in the Notice of Offer. If the Selling Member
does not consummate the sale of its Interest within such additional 60-day
period, the restrictions against transfer provided in this Agreement shall again
apply, and no sale by the Selling Member of any of its Interest shall be made
other than in accordance with the terms of this Section 7.4. In the event of any
permitted transfer to a Permitted Transferee pursuant to this Section 7.4, such
purchaser must be required by the Selling Member, at the request of the other
Member, to become a party to this Agreement before transfer of the Interest may
occur.

                                  ARTICLE VIII
                                  ------------
                        TERM, TERMINATION AND DISSOLUTION
                        ---------------------------------

       8.1    TERM. Unless terminated earlier pursuant to Section 8.2, the
Company shall continue in existence for a period of five (5) years (the "Initial
Term"). Following the Initial Term, the Company shall continue in existence for
successive one year periods unless notice of non-renewal is given at least 180
days prior to the expiration of the applicable term. In the event that any
Member gives notice of non-renewal pursuant to this section, the Company shall
begin immediately to wind up its affairs in accordance with Section 8.3(c)
hereof.

       8.2    EARLY TERMINATION. The relationship between the Members reflected
in this Agreement may be terminated, and the Company dissolved, prior to the
term set forth in Section 8.1 hereof in the following circumstances:

       (a)    by the mutual written agreement of the Members;

       (b) by the remaining Member upon the legally required withdrawal from the
       Company of the other Member;

       (c) by the non-breaching Member upon the continuation of any material
       breach of this Agreement by the other Member for a period of 30 days
       after written notice of such breach is given by the non-breaching Member;

       (d) by either Member upon the entering of any decree of any court of
       competent jurisdiction directing dissolution of the Company, in
       accordance with its terms;

       (e) upon the happening of any other event which under law effects the
       dissolution of the Company or upon the bankruptcy of the Company; or

       (f) automatically upon the purchase by one of the Members of all of the
       other's Interest pursuant to Section 7.4 hereof.

                                     - 8 -
<PAGE>

       Provided however, the Members shall not voluntarily terminate the
       existence of the Company until such time as the Promissory Note is paid
       in full.

       8.3    EFFECTS OF TERMINATION.

       (A)    MUTUAL AGREEMENT. In the event of a termination by the mutual
written agreement of the Members, the Members shall cease marketing to new
customers the telecommunications services which are the subject of this
Agreement. To the extent that the Company or either Member is a party to a
service contract with a third party, and such contract requires the ongoing use
of telecommunications services provided by the Company, the Company shall
continue to provide the services necessary to fulfill the contract; provided,
however, that the Company, or the Member that is the party to such a contract,
shall immediately takes steps to identify an alternative source of those
services and to provision the contract for its remaining term through such an
alternative source as soon as possible.

       (B)    DEFAULT OF A MEMBER. In the event of any termination pursuant to
Sections 8.2(b), (c), (d) or (e) hereof, the Member which has not (i) given
notice of termination, (ii) dissolved, (iii) become bankrupt, (iv) breached or
(v) become disqualified, as the case may be (the "Passive Member"), shall be
entitled, at its sole option, to elect by written notice to the other Member,
given within 30 days after such termination, to purchase the Interest of the
other Member at fair market value. The fair market value shall be agreed upon by
the Managers. If the Managers are unable to agree upon the fair market value,
the purchase price shall be established by an outside appraiser mutually
selected by the Members.

       (C)    DISSOLUTION. In the event of a termination, if no Member gives
notice within the relevant period for the exercise of the rights permitted by
Section 8.3(b), or if written notice is given by either Member demanding
dissolution, then the Company shall be dissolved. Upon dissolution of the
Company, the affairs of the Company shall be wound up and its assets liquidated
as follows:

              (i)    The Company shall commence to wind up its business and
       affairs as soon as practicable thereafter. To the extent that the Company
       or either Member is a party to a service contract with a third party, and
       such contract requires the ongoing use of telecommunications services
       provided by the Company, the Company shall continue to provide the
       services necessary to fulfill the contract; provided, however, that the
       Company, or the Member that is the party to such a contract, shall
       immediately take steps to identify an alternative source of those
       services and to provision the contract for its remaining term through
       such an alternative source as soon as possible. The Company shall be
       dissolved only after its affairs have been wound up and its assets
       distributed in liquidation. Pending dissolution of the Company, this
       Agreement shall continue to govern the affairs of the Company and the
       Members shall continue to share profit and loss, and net cash flow
       distributions during the period of liquidation in the same manner as set
       forth in Sections 5.2 and 5.3 hereof.

                                     - 9 -
<PAGE>

              (ii)   The Company shall use its best efforts to liquidate the
       assets and business as an entirety, but the Managers shall have the right
       to determine the manner and terms of liquidation of the Company's assets,
       having due regard for the realization of fair value from and the
       minimization of losses attendant upon such liquidation. The proceeds, if
       any, from such liquidation shall be applied and distributed in the
       following order of priority: (A) to the payment of all debts and
       liabilities of the Company and all expenses of liquidation. The
       Promissory Note shall have priority over payment of all other liabilities
       or debts; (B) to the establishment of such reserves as the Company (or
       other liquidating agent) may deem reasonably necessary to provide for
       contingent or unforeseen liabilities or obligations of the Company; and
       (C) to the Members in accordance with their Percentage Interests;

              (iii)  Other than TOFL, pursuant to the Promissory Note and
       Security Agreement, no Member shall have any right to demand or receive
       property other than cash upon dissolution and termination of the Company.
       If any real property of the Company is to be distributed in kind, any
       Member entitled to any interest in such property shall receive its
       interest therein as a co-owner with all other Members so entitled. If the
       Members are unable to agree upon the gross fair market value of any
       assets to be distributed in kind, such gross fair market value shall be
       determined by an independent appraiser selected by the Members (or other
       liquidating agent), the fees and expenses for which shall be borne by the
       Company;

              (iv)   Within a reasonable time following completion of the
       liquidation of the Company's properties, the Company (or other
       liquidating agent) shall cause the Accountants to furnish to each of the
       Members an audited statement setting forth the assets and liabilities of
       the Company as of the date of complete liquidation, and each Member's
       portion of distributions made pursuant to this Section 8.3(c);

              (v)    At such time as the Company (or other liquidating agent)
       determines that the reserves for contingent or unforeseen liabilities or
       obligations of the Company are no longer necessary, any proceeds of
       liquidation held in such reserves shall be distributed in proportion to
       the Members' Percentage Interests immediately before the distribution
       described in Section 8.3(c)(ii) hereof;

              (vi)   Upon completion of the liquidation of the Company and the
       distribution of all Company funds, the Company shall dissolve and the
       Company Agreement shall terminate and the Members (or other liquidating
       agent) shall execute, acknowledge and record or file any required
       documents with the appropriate authorities as well as any and all other
       documents or instruments required to effectuate the dissolution and
       termination of the Company and the Company Agreement.

                                     - 10 -
<PAGE>

                                   ARTICLE IX
                                   ----------
                        SUBSTITUTION; ADDITIONAL MEMBERS
                        --------------------------------

       9.1    ADMISSION OF SUBSTITUTED MEMBERS. The transferee of an Interest
may not be admitted as a substituted Member unless and until all of the
following conditions have been met:

              (a)    The transfer is made in accordance with Sections 7.3 and
7.4 hereof;

              (b)    There has been filed with the Managers a written
instrument, executed by the transferor, in form and substance reasonably
satisfactory to the Managers, transferring to the transferee all or part of the
transferor's Interest;

              (c)    The transferee has confirmed, approved and adopted all of
the terms and provisions of this Agreement, as the same may have been amended,
which confirmation, approval and adoption may be evidenced by the execution by
such transferee of a counterpart of this Agreement or in any other manner as is
reasonably required by the Managers; and

              (d)    The transferee has paid or agreed to pay, as the Managers
may determine, all reasonable expenses relating to such admission.

              The time of admission of a transferee as a Member shall be the
time when all of the conditions of this Section 9.1 have been satisfied.

       9.2    ADDITIONAL MEMBERS. Upon the majority agreement of the Members,
additional Interest may be issued and sold to any person, whether or not already
a Member, for the fair market value thereof, as determined in good faith by the
Managers and under such other terms and conditions as deemed advisable by the
Managers, including but not limited to terms and conditions relating to the
applicability of this Agreement to such additional Interest. Admission of any
Member pursuant to this Section 9.2 shall not be a cause of dissolution.

                                    ARTICLE X
                                    ---------
                                    SERVICES
                                    --------

       10.1   SERVICES PROVIDED BY THE COMPANY. Subject to the Managers' review
on a quarterly basis, the President of the Company will be responsible for the
day-to-day business affairs of the Company and will set all rates and
commissions. At such time as service is provided through the Company platform,
TOFL, or any of its affiliates, will provide the Company with a current LCR and
premium LCR from which to develop end user rates at a margin to be mutually
agreed upon. The Company will be charged all network and switching charges at a
minimum of $.0025 per minute not to exceed $.01 per minute. TOFL, or any of its
affiliates, will be responsible for providing its global VoIP, TDM, and Frame
Relay network infrastructure for the termination of

                                     - 11 -
<PAGE>

international traffic for Efonica. Efonica will be responsible for the costs
associated with the prepaid PC-to-Phone specific equipment requirements. TOFL,
or any of its affiliates, will work with Efonica to determine the most effective
and cost efficient PC-to-Phone infrastructure solution. The Company will issue
monthly sales and financial reports. TOFL, or any of its affiliates, will
provide a statement of network and termination costs on a monthly basis. Actual
performance against budget will be monitored and variances reviewed by the
Board. Non-budgeted expenses will be subject to financial review and written
approval by the Chairman of the Board. Back office support and sales will be
provided at cost to the Company through a management agreement to be executed
between the Company and Dot LB in Beirut, Lebanon. The Company intends, subject
to national and international trademark availability, to brand as its
servicemark or trademark "Efonica" and shall take all steps necessary to secure
intellectual property protection.

                                   ARTICLE XI
                                   ----------
                     CONFIDENTIALITY/PROPRIETARY INFORMATION
                     ---------------------------------------

       11.1   CONFIDENTIALITY. Each of the Members recognizes that it may gain
access to certain confidential, proprietary and trade secret information
belonging to the other Member in the course of performing its duties under this
Agreement. Each Member agrees to hold in strict confidence and not disclose to
any other person any confidential information obtained from the other Member,
except to the extent required by law or approved by the other Member. The
obligations of the Members under this Section 11.1 will survive the expiration
and termination of this Agreement. Upon termination of this Agreement, each
Member agrees to return to the other Member any written materials obtained from
the other which contain confidential or proprietary information belonging to the
other Member.

                                   ARTICLE XII
                                   -----------
                         REPRESENTATIONS AND WARRANTIES
                         ------------------------------

       12.1   REPRESENTATIONS OF KARAM. Karam hereby represents and warrants as
follows:

       (a)    Karam is a corporation duly organized, validly existing and in
good standing under the laws of the Territory of the British Virgin Islands, and
is duly qualified (or shall expeditiously take such action to cause it to be
duly qualified) to do business in such jurisdictions as the Company business
shall require, and has full power and authority to carry on its business as now
conducted, and to own its assets, property and business.

       (b)    All proceedings required to be taken by or on behalf of Karam to
authorize Karam to enter into and carry out this Agreement have been duly and
properly taken, and this Agreement has been duly executed and delivered by
Karam, and constitutes a legal, valid and binding agreement of Karam enforceable
in accordance with its terms.

                                     - 12 -
<PAGE>

       (c)    Karam has full power, right and authority to enter into and
perform this Agreement and the other agreements contemplated hereby. The
execution and delivery of this Agreement and the consummation of the
transactions contemplated hereby will not result in a default under, or violate,
any agreement to which Karam is a party or by which its property is bound or its
Articles of Incorporation and By-laws.

       12.2   REPRESENTATIONS OF TOFL. TOFL hereby represents and warrants as
follows:

       (a)    TOFL is a corporation duly organized, validly existing and in good
standing under the laws of the Republic of Mauritius , and is duly qualified (or
shall expeditiously take such action to cause it to be duly qualified) to do
business in such jurisdictions as the Company business shall require, and has
full power and authority to carry on its business as now conducted, and to own
its assets, property and business.

       (b)    All corporate and other proceedings required to be taken by or on
behalf of TOFL to authorize TOFL to enter into and carry out this Agreement have
been duly and properly taken, and this Agreement has been duly executed and
delivered by TOFL, and constitutes a legal, valid and binding agreement of TOFL
enforceable against TOFL in accordance with its terms.

       (c)    TOFL has full power, right and authority to enter into and perform
this Agreement and the other agreements contemplated hereby. The execution and
delivery of this Agreement and the consummation of the transactions contemplated
hereby will not result in a default under, or violate, any agreement to which
TOFL is a party or by which its property is bound, or TOFL's Articles of
Incorporation or By-Laws.

                                  ARTICLE XIII
                                  ------------
                                  MISCELLANEOUS
                                  -------------

       13.1   ENTIRE AGREEMENT. This Agreement and the Schedules and Exhibits
attached hereto, constitutes the entire agreement between the parties with
respect to the subject matter hereof, and any other promises, statements,
representations or inducements shall be of no force or effect unless set forth
herein.

       13.2   AMENDMENTS. This Agreement may be amended from time to time upon
the written consent of the Members.

       13.3   NO ASSIGNMENT. Neither party may assign this Agreement, or any of
its rights, duties or obligations hereunder, without the prior written consent
of the other party.

       13.4   NOTICES. All notices to The Company or any Member under this
Agreement shall be in writing, duly signed by the party giving such notice, and
transmitted personally or mailed postage prepaid by first class certified mail
to such Member's address set forth below, or to any

                                     - 13 -
<PAGE>

such other address as may hereafter be designated by a Member upon giving notice
thereof to the Company and each other Member in accordance with this Section
13.4. All notices shall be deemed given when personally delivered or, if mailed,
upon confirmation of return receipt.

                  Karam:   Roger Karam
                           Karamco, Inc.
                           DOT LB Ctr, 9th Floor
                           Dekwaneh, Beirut - Lebanon
                           Attention:  Mr. Roger Karam

                  TOFL:    Telecommunications overseas fusion ltd
                           Suite 410
                           4th Floor
                           Barkly Wharf, Le Caudan Waterfront
                           Port Louis, Mauritius

       13.5   AGREEMENT MAY BE EXECUTED IN COUNTERPARTS. This Agreement and any
consents required hereunder may be executed in counterparts, all of which, taken
together, shall be deemed one original.

       13.6   BINDING PROVISIONS. Except as herein otherwise provided to the
contrary, this Agreement shall be binding upon and inure to the benefit of the
parties hereto, their heirs, personal representatives, successors and permitted
assigns.

       13.7   GOVERNING LAW. This Agreement shall be construed in accordance
with and governed by the laws of the State of New York. Any action to enforce
this Agreement, seeking damages or injunctive relief for breach of this
Agreement, or otherwise asserting any claims relating to this Agreement shall be
brought in the federal or state courts of New York, and the parties hereto agree
to submit themselves to the exclusive jurisdiction of such courts.

       13.8   RELATIONSHIP OF THE PARTIES. Karam and TOFL agree that each shall
owe to the Company and to each other, as Members in the Company, a strict
fiduciary duty of loyalty, diligence, good faith and fair dealing in all matters
relating to the business of the Company. With respect to all other matters
outside the business of the Company, Karam and TOFL are each free to pursue
their own business opportunities without regard to the other, even if such
opportunities place them in direct competition with each other.

       13.9   COOPERATION OF THE PARTIES. The parties agree to cooperate in good
faith, to execute and deliver such documents, and to perform such acts as are
reasonably necessary to effectuate the intent of the parties as expressed in
this Agreement. The parties further agree to cooperate in making any and all
regulatory filings that may be required to conduct the business contemplated by
this Agreement.

                                     - 14 -
<PAGE>

       IN WITNESS WHEREOF, the Members have hereunto set their hands as of the
day and year first above written.

                                    Karamco Inc.

                                    By__________/s/_______________________
                                       Name:
                                       Title:

                                    Telecommunications Overseas Fusion Ltd

                                    By__________/s/_______________________
                                        Name:
                                        Title:

<PAGE>

                                    EXHIBIT A

                            Certificate of Formation

<PAGE>

                                    EXHIBIT B

                     Promissory Note and Security Agreement

<PAGE>

                                    EXHIBIT C

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