Document:

Exhibit 10.5

                            STOCK PURCHASE AGREEMENT

      This STOCK PURCHASE  AGREEMENT (the  "Agreement") is made and entered into
this  5th  day  of  April,   2000,  by  and  between   ADVANCED   COMMUNICATIONS
TECHNOLOGIES, INC., a Florida corporation ("ACT-US") and ADVANCED COMMUNICATIONS
TECHNOLOGIES PTY LTD, an Australian corporation ("ACT-Australia").

                                    RECITALS

      WHEREAS,  ACT-US is a Florida  Corporation  that is publicly traded on the
OTC Bulletin Board, administered by NASDAQ, under the ticker symbol "ADVC"; and

      WHEREAS,  ACT-Australia  is an  Australian  corporation  that owns certain
rights to a new wireless communications network technology, to be marketed under
the name  Universe  Wide  Spectrum  Cellular-  "Spectrucell"  (the  "SpectruCell
Technology"); and

      WHEREAS, the Parties have entered into a Memorandum of Understanding dated
February  15,  2000,  whereby  ACT-US will  acquire  20% of the common  stock of
ACT-Australia; and

      WHEREAS,  the parties desire to enter into this Agreement to formalize the
purchase  contemplated  by the  Memorandum of  Understanding  upon the terms and
conditions contained herein.

                                    AGREEMENT

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

      1. Recitals.  The foregoing recitals are true and correct in every respect
and are hereby incorporated herein by reference,

      2. Definitions.  In addition to the terms defined  elsewhere  herein,  the
terms defined in the  introductory  paragraph and the Recitals to this Agreement
shall have the respective meanings specified therein or below, and the following
terms shall have the  meanings  specified  below when used  herein with  initial
capital letters:

            "Adverse  Consequences"  means  all  actions,  suits,   proceedings,
claims, damages, penalties, fines, costs, reasonable amounts paid in settlement,
liabilities,  losses,  expenses,  and fees, including court costs and reasonable
attorney's fees and expenses.

            "Affiliate"  means any person who,  with respect to a certain  other
person, controls that other person, or is controlled by that other person, or is
controlled by that same

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third  person who controls  the other  person,  in each case whether or not such
control is direct or indirect through one or more intermediaries.

            "Closing  Date"  means the later to occur of both the  execution  of
this Agreement and the performance of any conditions precedent to either party's
performance hereunder.

            "Governmental   Entity"   means  any   court,   arbitral   tribunal,
administrative   agency  or  commission  or  other  governmental  or  regulatory
authority or agency.

            "Purchase Price" means 5,000,000  restricted shares of ACT-US common
stock and $7,500,000 US as further described in Section 3 herein.

            "Transferred  Shares: means 20% of the issued and outstanding shares
of stock of ACT-Australia existing at the Closing Date.

      3. Purchase of Transferred Shares.

            (a) ACT-US hereby agrees to acquire the  Transferred  Shares for the
Purchase Price. The Purchase Price shall be paid as follows:

                  (i)  Certificates  for 5,000,000  shares of restricted  common
            stock of ACT US shall be delivered to  ACT-Australia as set forth in
            Section 3(e) herein; and

                  (ii)   $7,500,000  US  to  be  paid  in  three  equal  monthly
            installments,  without  interest,  commencing  on May 31,  2000 (the
            "Cash Portion of the Purchase  Price").  ACT-US shall be entitled to
            offset any  amounts  owed to it by  ACT-Australia  against  the Cash
            Portion of the Purchase Price.

            (b) ACT-Australia  hereby agrees to sell and deliver the Transferred
Shares to ACT-US for the Purchase Price as set forth in Section 3(e) herein.

            (c)  ACT-Australia  merges  or  consolidates  with any  entity  that
survives the merger or consolidation,  ACT-Australia and its shareholders  shall
cause the surviving entity to issue and deliver the Transferred Shares to ACT-US
pursuant to the terms herein.

            (d) The parties acknowledge and agree that ACT-US shall use its best
efforts to raise the Cash  Portion  of the  Purchase  Price  through a public or
private  offering  of  securities.  ACT  Australia  hereby  agrees to extend the
monthly  installment  payment  deadlines,  without interest,  to allow ACT-US to
raise the Cash Portion of the Purchase Price. The parties  acknowledge and agree
that upon raising funds  pursuant to a public or private  offering of securities
ACT-US shall only be obligated to transfer to  ACT-Australia as part of the Cash
Portion of the Purchase Price those funds  remaining after deduction of reserves
needed for current operations, working capital and the development and expansion
of its operations and the

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operations of its subsidiaries. as determined by its Board of Directors.

            (e)  Within 15 days  after the  Closing  Date,  ACT-US  shall  issue
certificates for 5,000,000 shares of restricted common stock to ACT-Australia in
denominations requested by ACT-Australia,  which certificates shall be delivered
to and held in escrow by Jack Halperin, Esq., counsel for ACT-US Upon receipt by
him of the Transferred  Shares,  he will transfer the certificates for 5,000,000
shares of ACT-US common stock to  ACT-Australia  and the  Transferred  Shares to
ACTUS.

      4.   Representations   and  Warranties  of  ACT-Australia.   ACT-Australia
represents and warrants to ACT-US as follows:

            (a)  Organization  ACT-Australia  is a corporation  duly  organized,
validly  existing,  and in good standing  under the laws of  Australia,  is duly
authorized  under  Australia  law to carry on its  business7  has all  requisite
corporate power and authority to own,  lease,  and operate its properties and to
carry on its business as now being conducted. ACT-Australia is duly qualified or
licensed to do business and is in good  standing in each  jurisdiction  in which
the  property  owned,  leased,  or operated by it or the nature of the  business
conducted by it makes such qualification or licensing unnecessary.

            (b) Transferred  Shares.  ACT-Australia shall deliver to ACT-US good
and  marketable  title to the  Transferred  Shares  free and clear of all liens,
trusts, claims, charges, security agreements arid other encumbrances of any kind
or nature whatsoever.

            (c) No Consents.  Neither the execution,  delivery or performance of
this  Agreement  nor  the  consummation  by  ACT-Australia  of the  transactions
contemplated  hereby  require  any filing  with,  or  authorization,  consent or
approval of any Governmental Entity, notices, filings, authorizations,  consents
and approvals which if not obtained or made would have a material adverse effect
to ACT-Australia or materially impair the ability of ACT-Australia to consummate
the transactions contemplated by this Agreement.

            (d) Authority.  ACT-Australia has all requisite  corporate power and
authority to execute and deliver this  Agreement and to carry out its obligation
hereunder.  The execution and delivery of this Agreement and the consummation of
the transactions  contemplated hereby have been duly authorized by alt necessary
corporate action on the part of  ACT-Australia,  including  authorization by its
Board of Directors,  and this  Agreement has been duly executed and delivered by
ACT-Australia  and  constitutes  the valid and  legally  binding  obligation  of
ACT-Australia,  enforceable  against it in accordance with its terms,  except as
enforceability   may  be   limited   by   applicable   bankruptcy,   insolvency,
reorganization,  moratorium,  rehabilitation7  or  similar  laws  affecting  the
enforcement of creditors' rights generally.

            (e) No  Violations.  Neither  the  execution  and  delivery  of this
Agreement nor the consummation of the transactions  contemplated hereby will (i)
violate any statute,  regulation,  rule,  injunction,  judgment,  order, decree,
ruling1  charge  or  other  restriction  of any  Governmental  Entity  to  which
ACT-Australia  is  subject;  (ii)  conflict  with or result in the breach

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of any provision of  ACT-Australia's  charter or bylaws or (iii)  conflict with,
result  in a  breach  of,  or  constitute  a  default  under  any of the  terms,
conditions  or  provisions  of any  material  agreement or  obligation  to which
ACT-Australia may be bound or to which any of the assets of ACT-Australia may be
subject.

            (f) Ownership of SpectruCell. ACT-Australia has all right, title and
interest  in and to the  Spectrucell  Technology,  and  its  development  of the
Spectrucell  Technology  does not  infringe  any third  party's  patent or other
rights.  Further,  ACT-Australia  owns 70% of the  outstanding  common  stock of
Australon Enterprises Pty Ltd

            (g) Financial Statements. To the extent available, ACT-Australia has
made available to ACT-US for inspection complete copies of the unaudited balance
sheets and operating (profit and loss) statements of ACT-Australia as at and for
December 31, 1999 (collectively, the "Statements"),  including the Balance Sheet
of the Company as at December31,  1999 (the  "Effective Date Balance Sheet") The
Statements,  including the Effective Date Balance Sheet correctly and accurately
present the financial  position and results of operations of ACT-Australia as of
the dates and for the periods covered by such Statements

            (h) The  Recitals  to this  Agreement  are true and  correct  in all
material respects.

      5.  Representations  and Warranties of ACT-US ACT-US hereby represents and
warrants to ACT-Australia as follows:

            (a)  Organization  ACT-US is a corporation  duly organized,  validly
existing,  and in good standing  under the laws of Florida,  is duly  authorized
under Florida law to carry on its business as presently being conducted, has all
requisite  corporate  power  and  authority  to  own,  lease,  and  operate  its
properties  and to carry on its business as now being  conducted and as proposed
to be conducted and consummate this Agreement.

            (b) ACT-US Shares.  ACT-US shall deliver to  ACT-Australia  good and
marketable  title to its shares to be  transferred  pursuant to this  Agreement,
free and clear of all liens, trusts,  claims,  charges,  security agreements and
other encumbrances of any kind or nature  whatsoever,  provided that such shares
shall bear a restricted legend.

            (c) No Consents.  Neither the execution,  delivery or performance of
this  Agreement  of ACT-US nor the  consummation  by ACT-US of the  transactions
contemplated  hereby  require  any filing  with,  or  authorization,  consent or
approval of any Governmental Entity except for notices, filings,  authorizations
consents  and  approvals  which if not  obtained  or made  would not  materially
impair~ the ability of ACT-US to consummate  the  transactions  contemplated  by
this Agreement.

            (d)  Authority.   ACT-US  has  all  requisite  corporate  power  and
authority to execute and deliver this  Agreement and to carry out its obligation
hereunder The execution and delivery of this Agreement and the  consummation  of
the transactions  contemplated hereby have

<PAGE>

been duly  authorized by all necessary  corporate  action on the part of ACT-US,
including  authorization by its Board of Directors,  and this Agreement has been
duly  executed  and  delivered by ACT-US and  constitutes  the valid and legally
binding  obligation of ACT-US,  enforceable  against it in  accordance  with its
terms,  except  as  enforceability  may be  limited  by  applicable  bankruptcy,
insolvency,   reorganization,   moratorium,   rehabilitation,  or  similar  laws
affecting the enforcement of creditors' rights generally.

            (e) No  Violations.  Neither  the  execution  and  delivery  of this
Agreement nor the consummation of the transactions contemplated hereby, will (a)
violate any statute,  regulation,  rule,  injunction,  judgment,  order, decree,
ruling,  charge or other restriction of any Governmental  Entity to which ACT-US
is subject; (b) conflict with or result in the breach of any provision of either
ACT-U S's  charter  or bylaws or (c)  conflict  with,  result in a breach of, or
obligation  to which either  ACT-US may be bound,  except  where the  violation,
conflict1 breach or default would not materially impair such ACT-US's ability to
consummate the transactions contemplated by this Agreement.

            (f)  Business  of  ACT-US.  The  business  of ACT-US  is  accurately
described  in the  Current  Report on Form 8-K of ACT-US  filed  with the United
States Securities and Exchange Commission on February 4, 2000, as amended and/or
supplemented by subsequent filings.

      6. Board of Directors of  ACT-Australia.  ACT-US shall be entitled,  on an
ongoing basis,  to appoint one person (other than Roger May) to  ACT-Australia's
Board of Directors, which person shall be elected as a Director of ACT-Australia
at its annual meetings.

      7. Certain Covenants of the Parties.

            (a) Reasonable Efforts. Each of the Parties shall use all reasonable
efforts to take all actions and to do all things necessary, proper, or advisable
in order to consummate and make effective the transactions  contemplated by this
Agreement. Each of the Parties shall execute such other agreements and documents
as may be necessary or desirable to effectuate the intent of this Agreement.

            (b)  Expenses.  Each of the  Parties  shall  pay its own  costs  and
expenses incurred in connection with the preparation of and consummation of this
Agreement and the transactions contemplated hereby. The Parties acknowledge that
no tiling under the H-S-R Act is required in connection with this transaction.

      8. Survival; Indemnification.

            (a)  Survival  of  Representations   and  Warranties.   All  of  the
representation  and warranties of ACT Australia and of ACT-US  contained  herein
shall continue in full force and effect for 3 years after the Closing Date.

            (b)  Indemnification  Provisions for Benefit of ACT-US. In the event
ACT-Australia  breaches (i) any of its representations and warranties  contained
in Section 4 of this

<PAGE>

Agreement or (ii) any of their covenants contained in this Agreement, and ACT-US
shall have delivered a written notice setting forth with  reasonable  detail the
amount and basis for any claim (a "Claim  Notice") to  ACT-Australia  before the
3rd anniversary date of the Closing Date,  then, if  ACT-Australia  fail to cure
such  breach  within  30  days  following  the  aforementioned  written  notice,
ACT-Australia   agrees  to  indemnify   ACT-US  from  and  against  any  Adverse
Consequences ACT-US may suffer which are caused proximately by the breach.

            (c) Indemnification Provisions for Benefit of ACT -Australia. In the
event ACT-US breaches (i) any of its representations and warranties contained in
Section  5 of this  Agreement  or (ii) any of its  covenants  contained  in this
Agreement,  and  ACT-Australia  shall have  delivered  a Claim  Notice to ACT-US
before the 3rd  anniversary  date of the Closing  Date,  then  ACT-US  agrees to
indemnify ACT-Australia from and against any Adverse Consequences  ACT-Australia
may suffer which are caused proximately by the breach.

      9.  Notices.  All  notices,  requests,  demands  and other  communications
hereunder  shall be in writing  and shall be deemed to have been duly  delivered
and received when hand  delivered,  telecopied,  faxed,  delivered by courier or
five days after such notice is mailed by certified or registered  mail,  postage
prepaid and return receipt requested,  to the address set forth below or to such
other  address of which any party may have given notice in  accordance  with the
terms hereof:

      If to the Corporation:

               Advanced Communications Technologies, Inc.
               Attn:     Roger May
               19200 Von Karman Avenue
               Suite 500, Office #32
               Irvine, CA 92604
               Facsimile: (949) 477-8022

      With a copy to:

               Levinson & Lichtman, LLP
               Attn:     Jonathan J. Lichtman, Esq.
               Sanctuary Centre Suite D-100
               4800 North Federal Highway
               Boca Raton, FL 33431
               Facsimile:(561) 447-0018

<PAGE>

      If to ACT-Australia:

               Advanced Communications Technologies, Inc.
               Attn:     Graeme Shearer
               350 Queen Street, 20th Floor
               Melbourne, VIC 3000
               Australia
               Facsimile:  (011) 613 9672 8857 or 8800

      With a copy to.

               Mr. Roger May
               19200 Von Karman Avenue
               Suite 500, Office #32
               Irvine, CA 92604
               Facsimile:  (949) 477-8022

      10.  Review with  Counsel.  Each of the  parties  signing  this  Agreement
acknowledges  that each of them have had an opportunity to review this Agreement
with its attorney and to consult with its attorney  concerning the terms of this
Agreement.

      11. Miscellaneous Provisions.

            (a) This Agreement will be governed by and construed and enforced in
accordance  with the laws of the  State of  Victoria,  Australia.  Venue for any
action brought hereunder shall be in Melbourne, Victoria.

            (b) The Section headings contained herein are for reference purposes
only and will not in any way  affect  the  meaning  and  interpretation  of this
Agreement.

            (c) This  Agreement  will be binding  upon and will  operate for the
benefit of the  parties to this  Agreement  and their  respective  heirs,  legal
representatives and successors.

            (d) This Agreement  contains the entire agreement of the parties and
all prior  understandings  and agreements,  whether written or oral, between the
parties  are merged  into this  Agreement.  This  Agreement  cannot be  altered,
amended, supplemented,  modified, assigned or terminated except by an instrument
in writing signed by all of the parties to this Agreement.

            (e)  Should it become  necessary  for any party to  institute  legal
action to enforce the terms and  conditions of this  Agreement,  the  successful
party will be awarded reasonable  attorneys' fees, which will include reasonable
attorneys'  fees  for  any  appellate  proceedings,   expenses,   including  any
accounting expenses, and costs.

            (f) The invalidity or unenforceability  of any particular  provision
of

<PAGE>

this Agreement will not affect the other  provisions of this Agreement,  and the
Agreement will be construed in all respects as if such invalid or  unenforceable
provisions were omitted.

            (g)  This  Agreement  will be  signed  and  executed  in one or more
counterparts, each of which will be deemed an original and all of which together
shall  constitute  one  agreement.  Faxed  signatures  shall be deemed  original
Signatures for purposes of execution of this Agreement.

            (h) The parties expressly represent, acknowledge and agree that this
Agreement was negotiated and entered into on an  arms-length,  equal  bargaining
power basis and not under duress of any kind whatsoever. The preparation of this
Agreement  has been a joint  effort  of the  parties  hereto  and the  resulting
document shall not,  solely as a matter of judicial  Construction,  be construed
more severely against one of the parties than the other.

            (i) The parties will execute and deliver such further  documents and
take such  further  actions as may  reasonably  be  requested by counsel for any
party in order to more fully carry out the intentions of this Agreement.

            (j) All  references  to sums of money  contained  in this  Agreement
shall be in United States dollars.

      IN WITNESS WHEREOF,  the parties hereto have executed this Agreement as of
the date first above written.

WITNESSES:

---------------------------     ADVANCED COMMUNICATIONS
                                TECHNOLOGIES, INC.

---------------------------     By: /s/ Roger May
                                    ---------------------------------------
                                    Roger May, Chief Executive Officer

---------------------------     ADVANCED COMMUNICATIONS
                                TECHNOLOGIES, INC.

---------------------------     By: /s/ Graeme Shearer
                                    ---------------------------------------
                                    Graeme Shearer, Chief Financial OfficerEMPLOYMENT AGREEMENT

     AGREEMENT  dated as of September 12, 1996 by and between  Virtual  Reality,
Inc., a Nevada  corporation (the "Company"),  and Martin Cardone,  an individual
currently residing at 116 John Street,  New York, New York 10038  (individually,
the "Executive", collectively the "Parties").

                              W I T N E S S E T H:

     WHEREAS, the Company desires to employ Executive,  and Executive desires to
be employed by the Company, upon the terms and conditions hereafter set forth;

     NOW,  THEREFORE,  in consideration of the premises and the mutual covenants
herein contained, the Parties hereby agree as follows:

     1. Employment and Duties.

     (a) General. The Company hereby employs Executive and Executive agrees upon
the terms and conditions  herein set forth to serve as the  CEO/Chairman  of the
Company,  and  in  such  capacities  Executive  agrees  to  perform  the  duties
delineated  in the  By-Laws  of  the  Company,  together  with  such  reasonable
additional duties,  commensurate with Executive's  position as CEO/Chairman,  as
may be assigned to Executive  from time to time by the Board of  Directors  (the
"Board")of the Company. Without limiting the foregoing, Executive's duties shall
include  preparing  monthly  management  accounts  and  reports in such form and
manner as shall be prescribed by the Board.  If elected or appointed,  Executive
shall also serve as a director or officer of any of the  Company's  subsidiaries
or affiliated companies and, if elected,  will serve as a member of the Board or
committees of the Board,  without further  compensation.  Executive shall not be
elected  a  member  of the  Board  or  committees  of  the  Board  prior  to the
commencement of year two of the initial Term (as hereinafter defined).

     (b)  Exclusive  Services.  For so  long as  Executive  is  employed  by the
Company, Executive shall, except as may from time to time be otherwise agreed to
in writing by the Company  pursuant to authority  granted by a resolution of the
Board,  devote  his  full-time  working  hours to his  duties  hereunder,  shall
faithfully  serve the Company,  shall in all respects conform to and comply with
the lawful and good faith directions and instructions given to him by the Board,
and shall use his best  efforts  to  promote  and  serve  the  interests  of the
Company.

     (c) No  Other  Employment.  For so long as  Executive  is  employed  by the
Company,  Executive  shall not,  directly or indirectly,  render services to any
other  person or  organization  for which he receives  compensation  without the
consent of the Company pursuant to the authority  granted by a resolution of the
Board or otherwise engage in activities which would interfere significantly with
his  faithful  performance  of  his  duties  hereunder.  Executive  may  perform
inconsequential services without direct compensation therefor in connection with
the  management  of personal  investments,  provided that such activity does not
contravene the provisions of section 5 hereof.

     2. Term of  Employment.  The Company  shall retain  Executive and Executive
shall serve in

<PAGE>

the employ of the Company for the four year period  commencing  as of  September
12, 1996 (the  "Effective  Date") and ending on September 11, 2000 (the "Term"),
subject to earlier  termination in accordance  with Section 4 of this Agreement.
The Term shall be automatically  extended without further action by either party
for a successive or successive one-year period or periods, unless written notice
of either  party's  intention to terminate  this Agreement has been given to the
other party at least  ninety days prior to the  expiration  of the Term.  In the
event that the  Company  elects not to extend  the Term in  accordance  with the
provisions of this Section 2, Executive  shall be entitled to devote  reasonable
periods of time during the remaining Term to seek new  employment.  For purposes
of this Agreement, the twelve (12) month period commencing on the Effective Date
and ending on the first anniversary  thereof,  and each twelve (12) month period
ending on each subsequent anniversary thereof during the Term, shall be referred
to as a "Contract Year".

     3.  Compensation  and Other  Benefits.  Subject to the  provisions  of this
Agreement,  the Company  shall pay and provide the  following  compensation  and
other  benefits  to  Executive  during  the Term as  compensation  for  services
rendered hereunder:

     (a) (i) Salary.  The Company  shall pay to  Executive an annual base salary
(the  "Salary") at the rate of $60,000 per annum in the first  Contract Year and
$150,000 per annum in the second, third and forth Contract Year. Salary shall be
payable in substantially equal installments at the end of each calendar month or
at such other  intervals as may be determined by the Company in accordance  with
its  payroll  practices  as  established  from time to time.  The Salary will be
reviewed not less often than annually by the Board and may be increased, but not
decreased.  However, in the event that the Company is unable to make any payment
due to the Executive pursuant to this Section 3 for any reason  whatsoever,  the
Executive has the right to convert any or all of such  payments to  unregistered
common stock of the Company at a Twenty  Percent  (20%)  discount of the closing
price as  reflected  on a  reputable  national  quotation  system such as Yahoo!
Finance as the date immediately prior to such conversion.

     (ii) As additional compensation to the Executive,  the Executive shall earn
the  following  number of shares of  common  stock so long as the  Executive  is
continuously  employed  by the  Company  through  January 1, 2000 (the  "Vesting
Date").  In the event that the  Executive  is not  continuously  employed by the
Company  through  the Vesting  Date,  the  Company  has the  exclusive  right to
"clawback" all of the shares earned pursuant to this sub-paragraph.

             Denomination                 Date Earned
             ------------                 -----------
               250,000                  December 31, 1996
               250,000                  March 31, 1997
               250,000                  June 30, 1997
               250,000                  September 30, 1997
               375,000                  December 31, 1997
               375,000                  March 31, 1998
               375,000                  June 30, 1998
               375,000                  September 30, 1998

     (b) Bonus.  The Company agrees that  Executive  shall be eligible to earn a
bonus (the "Bonus") for each  Contract  Year during the Term.  The minimum Bonus
for the initial Term shall be in accordance with the following schedule:

A Bonus for a Contract  Year  during the Term shall be paid no later than ninety
(90) days after the end of the Contract  year to which such Bonus relates In the
event that the Executive's employment ends under the circumstances  described in
Section 2 above,  the Bonus,  it any, for the final Contract Year of Executive's
employment  shall be paid to Executive  within ninety (90) days after the end of
such final  Contract  Year,  notwithstanding  that Executive is no longer in the
employ of the Company at that time.

     (c) Travel Expenses.  The Company shall reimburse  Executive for reasonable
travel  and  other  business-related  expenses  incurred  by  Executive  in  the
fulfillment of his duties  hereunder.  Travel expenses shall be accounted for in
accordance with Company  reporting  practices.  Travel shall be done in the most
commercially feasible manner under the circumstances.

     (d) Employee Benefits. The Company at its cost shall provide Executive with
the  insurance,  health,  major  medical,  disability  benefits  and sick  leave
benefits  provided to similarly  situated  executives of the Company.  Executive
shall also  participate  in all other benefit plans,  programs and  arrangements
that the Company typically makes available to its executive employees.

     (e) Vacation.  For the first Contract Year, Executive shall accrue vacation
days at a rate of one day per month of employment up to a maximum of twelve (12)
days and Executive shall be entitled to reasonable sick leave in accordance with
the Company's  policies as established from time to time. For each Contract Year
thereafter,  the maximum  number at vacation days accrued for such year shall be
increased by one (1) day for each full Contract Year  completed  prior  thereto,
and

<PAGE>

appropriate  adjustment shall be made to the monthly rate of vacation accrual to
reflect such increase;  provided,  however,  that the maximum number of vacation
days accrued in any Contract Year shall in no event exceed eighteen (18) days.

     (f) Automobile Allowance.  During Executive's  employment with the Company,
Executive  may  lease and  insure an  automobile  for his  business  use and the
Company  shall  promptly  reimburse  Executive,  provided that the amount of the
combined  leasing,  insurance and parking  payments shall not exceed $700.00 per
month (the "Allowance").

     4. Termination of Employment.

     (a) Termination for Cause;  Resignation  Without Good Reason. (i) If, prior
to the  expiration  of the Term,  Executive's  employment  is  terminated by the
Company  for Cause,  as defined in section  4(a) (ii)  hereof,  or if  Executive
resigns from his employment hereunder, other than for Good Reason, as defined in
section  4(a) (iii)  hereof,  Executive  shall be entitled to payment of the pro
rata portion of Executive's  Salary under section 3(a) through and including the
date of termination or resignation.  Except to the extent required by applicable
law,  Executive shall have no right under this Agreement or otherwise to receive
any other  compensation,  or to participate in any other plan,  arrangement,  or
benefit, after such termination or resignation of employment with respect to the
year of such termination or resignation and later years.

     (ii)   Termination  for  "Cause"  shall  mean  termination  of  Executive's
employment  with the  Company by the Board  because  of (A) any act or  omission
which  constitutes  a  material  breach  by  Executive  of  his  obligations  or
agreements  under this  Agreement  or the  failure or  refusal of  Executive  to
satisfactorily perform any duties reasonably required hereunder,  (other than by
reason of the  incapacity of Executive due to physical or mental  illness),  (B)
the commission by Executive of a felony,  or the  perpetration by Executive of a
dishonest  act or common law fraud  against the  Company,  or any  affiliate  or
subsidiary  thereof,  (C) any act or omission by  Executive  which,  in the good
faith  opinion of the Board,  is  injurious  in any  significant  respect to the
financial  condition  or  business  reputation  of  the  Company  or  any of its
affiliates  or  subsidiaries  (other  than any good  faith  act or  omission  in
furtherance  of the rights of the Company) and which  resulted from  Executive's
willful   misconduct  or  inexcusable   neglect  or  (D)  Executive's   habitual
drunkenness  on the job or excessive  absenteeism  not related to illness,  sick
leave, holiday leave or vacation.

     (iii) Resignation for "Good Reason" shall mean the resignation of Executive
after an act or  omission  by the  company  which is a  material  breach of this
Agreement;  provided,  however  that at least 20 days prior to such  resignation
Executive specifies to the Company in writing the nature of such act or omission
set forth in clause and the  Company or the Board does not  correct  such act or
omission   within  10  business   days  after  its   receipt  of  such   written
specification.

     (iv) The date of  termination  of  employment  by the  Company  under  this
section  4(a) shall be the date set forth in the written  notice of  termination
delivered by the Company to Executive,  unless no such date is specified in such
notice,  in which case the date of  termination  shall be the date of receipt by
Executive of written notice of termination.  The date of resignation  under this
section 4(a) shall be 10 business  days after  receipt by the Company of written
notice of resignation.

     (b) Termination Without Cause;  Resignation for Good Reason. (i) Subject to
the  provisions of section 4(b) (ii),  if, prior to the  expiration of the Term,
Executive's  employment  is  terminated  by the  Company  without  Cause,  or if
Executive  resigns from his  employment  hereunder for Good Reason,  the Company
shall continue to pay to Executive the Salary (at the rate An effect on the date
of such termination) during the remainder of the Term; provided,  however,  that
the  amount  of any  such  payments  shall be  reduced  by any  salary  or other
compensation  payment  received  by  Executive  from a  subsequent  employer  or
employers  during the  remainder of the Term.  Except to the extent  required by
applicable law, Executive shall have no right under this

<PAGE>

Agreement or otherwise to receive any other  compensation,  or to participate in
any other plan,  arrangement,  or benefit, after such termination or resignation
of employment  with respect to the year of such  termination or resignation  and
later years.

     (ii)  If,  following  a  termination  of  employment  without  Cause  or  a
resignation  for Good Reason,  Executive  breaches the  provisions  of section 5
hereof,  Executive shall not be eligible, as of the date of such breach, for the
payments  described  in this  section  4(b),  and any  and all  obligations  and
agreements of the Company with respect to such payments shall thereupon cease.

     (iii) The date of  termination  of  employment  by the  Company  under this
section 4(b) shall be the date  specified in a written  notice of termination to
Executive  or,  it no such date is  specified  therein,  the date on which  such
notice is given to  Executive  The date of  resignation  under this section 4(b)
shall be 10  business  days after  receipt by the  Company of written  notice of
resignation.

     (c)  Termination  Due to Death or  Disability.  In the event of Executive's
disability,  as defined  below,  the Company  shall be entitled to terminate his
employment.   Notwithstanding  anything  contained  in  this  Agreement  to  the
contrary,   if  Executive's   employment  should  terminate  due,  to  death  or
disability,  no further payments of Salary shall be earned by Executive, and any
Salary  earned by  Executive  to the date of such  termination  shall be paid to
Executive  or  Executive's  estate,  as the case may be,  within 30 days of such
termination.  As used in this  section,  the term  "disability"  shall  mean the
inability  of  Executive  to perform his services as President of the Company as
required hereunder due to physical or mental incapacity or illness for more than
45 consecutive days.

     5. Secrecy and Noncompetition.

     (a) No  Competing  Employment.  For so long as Executive is employed by the
Company and continuing for 3 years after the  termination of such  employment or
resignation  therefrom  (such  period  being  referred  to  hereinafter  as  the
"Restricted  Period"),  Executive  shall  not,  unless  he  receives  after  the
Effective  Date the prior written  consent of the Company  pursuant to authority
granted  by a  resolution  of  the  Board,  directly  or  indirectly  engage  or
participate,  as an owner, partner,  shareholder,  officer, employee,  director,
agent or consultant,  in any business which directly or indirectly competes with
the  Company  or any of its  subsidiaries  or  affiliates,  and,  further,  that
Executive  will not make any  investments in any business that competes with the
Company.

     (b) No  Interference.  During the Restricted  Period,  Executive shall not,
whether  for his  own  account  or for  the  account  of any  other  individual,
partnership,  firm,  corporation or other business  organization (other than the
Company),  intentionally  solicit,  endeavor to entice away from the Company, or
otherwise interfere with the relationship of the Company with, any person who is
employed by or otherwise engaged to perform services for the Company (including,
but not limited to, any independent sales  representatives  or organizations) or
any person or entity who is, or was within the then most recent 12 month period,
a customer or client of the Company.

     (c) Secrecy.  Executive recognizes that the services to be performed by him
hereunder  are  special,  unique  and  extraordinary  in that,  by reason of his
employment hereunder, he may acquire confidential  information and trade secrets
concerning the operation of the Company, or its affiliates or subsidiaries,  the
use or  disclosure  of which  could  cause  the  Company  or its  affiliates  or
subsidiaries  substantial loss and damages which could not be readily calculated
and for  which no  remedy  at law  would  be  adequate.  According1y,  Executive
covenants  and agrees with the Company  that he will not at any time,  except in
performance  of  Executive's  obligations  to the Company  hereunder or with the
prior  written  consent  of the  Company  pursuant  to  authority  granted  by a
resolution  of the  Board,  directly  or  indirectly,  disclose  any  secret  or
confidential  information  that he may  learn or has  learned  by  reason of his
association with the Company, or any of its subsidiaries and affiliates,  or use
any such information. The term "confidential information" includes, without

<PAGE>

limitation,  information not previously  disclosed to the public or to the trade
by  the  Company's  management  with  respect  to the  Company's,  or any of its
affiliates' or subsidiaries',  products,  facilities and methods,  trade secrets
and other intellectual  property,  systems,  procedures,  manuals,  confidential
reports,  product price lists, customer lists,  financial information (including
the revenues,  costs or profits associated with any of the Company's  products),
business  plans,  prospects or  opportunities  but shall exclude any information
already in the public domain.  Executive  understands and agrees that the rights
and  obligations set forth in this section 5(c) shall continue for 10 years and,
in any case,  shall  extend for a period of three  years  beyond the  Restricted
Period and Executive's employment hereunder.

     (d)  Exclusive   Property.   Executive   confirms  that  all   confidential
information  is and shall  remain the  exclusive  property of the  Company.  All
business records, papers and documents kept or made by Executive relating to the
business of the Company  shall be and remain the property of the  Company.  Upon
the  termination of his  employment  with the Company or upon the request of the
Company at any time,  Executive shall promptly deliver to the Company, and shall
not without the consent of the Company,  retain copies of, any written materials
not  previously  made  available to the public,  records and  documents  made by
Executive or coming into his  possession  concerning  the business or affairs of
the Company or any of its affiliates or subsidiaries;  provided,  however,  that
subsequent to any such  termination,  the Company shall provide  Executive  with
copies (the cost of which shall be borne by Executive)  of any  documents  which
are requested by Executive and which  Executive has determined in good faith are
(i) required to establish a defense to a claim that  Executive  has not complied
with his duties hereunder or (ii) necessary to Executive in order to comply with
applicable law. Executive understands and agrees that the rights and obligations
set forth in this  section  5(d) are  perpetual  and, in any case,  shall extend
beyond the Restricted period and Executive's employment hereunder.

     (e) Injunctive Relief. Without intending to limit the remedies available to
the  Company,  Executive  acknowledges  that a  breach  of any of the  covenants
contained  in this  section 5 may result in material  irreparable  injury to the
Company or its affiliates or subsidiaries  for which there is no adequate remedy
at law,  that it will not be  possible  to  measure  damages  for such  injuries
precisely and that, in the event of such a breach or threat thereof, the Company
shall be entitled to obtain a temporary  restraining  order and/or a preliminary
or  permanent  injunction  restraining  Executive  from  engaging in  activities
prohibited  by this  section  5 or  such  other  relief  as may be  required  to
specifically enforce any of the covenants in this section 5.

     (f) Extension of Restricted Period. In addition to the remedies the Company
may seek and obtain  pursuant to section 5(f),  the  Restricted  Period shall be
extended by any and all periods during which Executive shall be found by a court
possessing  personal  jurisdiction  over him to have  been in  violation  of the
covenants contained in this section 5.

     6. Source of Payments.  All payments  provided under this Agreement,  other
than payments made pursuant to a plan which provides otherwise, shall be paid in
cash from the general  funds of the  Company,  and no special or  separate  fund
shall be  established,  and no other  segregation  of  assets  made,  to  assure
payment. To the extent that any person acquires a right to receive payments from
the  Company  hereunder,  such right  shall be no  greater  than the right of an
unsecured creditor of the Company.

     7. Nonassignability; Binding Agreement.

     (a) By Executive. Without the prior written consent of the Company pursuant
to authority  granted by a resolution of the Board,  this  Agreement and any and
all rights,  duties,  obligations or interests hereunder shall not be assignable
or delegable by  Executive,  nor shall any right of  Executive  (or  Executive=s
estate or beneficiary, as the case may be) to any payment or benefit

<PAGE>

hereunder be subject to any manner of alienation or assignment.

     (b) By the Company.  This  Agreement  and all of the  Company's  rights and
obligations  hereunder may be assigned,  delegated or  transferred  by it to any
business entity which at any time by merger, consolidation or otherwise acquires
all or  substantially  all of the assets of the  Company or to which the Company
transfers  all or  substantially  all  of  its  assets.  Upon  such  assignment,
delegation  or  transfer,  any  such  business  entity  shall  be  deemed  to be
substituted for all purposes as the Company hereunder.

     (c) Binding Effect.  This Agreement shall be binding upon, and inure to the
benefit of, the parties hereto,  any successors to or assigns of the Company and
Executive's heirs and the personal representatives of Executive's estate.

     8.  Severability.  If the  final  determination  of a  court  of  competent
jurisdiction  declares,  after the  expiration of the time within which judicial
review (if permitted) of such  determination may be perfected,  that any term or
provision  hereof is  invalid  or  unenforceable,  (a) the  remaining  terms and
provisions hereof shall be unimpaired and (b) the invalid or unenforceable  term
or provision  shall be deemed  replaced by a term or provision that is valid and
enforceable and that comes closest to expressing the intention of the invalid or
unenforceable term or provision.

     9. Amendment; Waiver. This Agreement may not be modified, amended or waived
in any manner except by an instrument in writing signed by both parties  hereto;
provided,  however, that any such modification,  amendment or waiver on the part
of the Company shall have been previously  approved by the Board.  The waiver by
either party of  compliance  with any  provision of this  Agreement by the other
party shall not operate or be  construed  as a waiver of any other  provision of
this Agreement, or of any subsequent breach by such party of a provision of this
Agreement.

     10. Tax Withholding. Payments to Executive of all compensation contemplated
under this  Agreement  be  subject to all  applicable  legal  requirements  with
respect to the withholding of taxes.

     11.  Governing  Law. All matters  affecting this  Agreement,  including the
validity  thereof,  are to be governed  by, and  interpreted  and  construed  in
accordance  with,  the laws of the  State of New York  applicable  to  contracts
executed in and to be performed in that State.

     12.  Notices.  Any notice  hereunder  by either party to the other shall be
given in  writing  by  personal  delivery  or  certified  mail,  return  receipt
requested. If addressed to Executive, the notice shall he delivered or mailed to
Executive at the address first set forth above,  or if addressed to the Company,
the notice shall be delivered or mailed to, or such other address as the Company
or Executive may designate by written notice at any time or from time to time to
the other party. A notice shall be deemed given, if by personal delivery, on the
date of such  delivery  or,  if by  certified  mail,  on the  date  shown on the
applicable return receipt.

     13. Supercedes Previous Agreements.  This Agreement supersedes all prior or
contemporaneous negotiations,  commitments, agreements and writings with respect
to  the  subject  matter  hereof,  all  such  other  negotiations,  commitments,
agreements and writings will have no further force or effect, and the parties to
any such  other  negotiation,  commitment,  agreement  or  writing  will have no
further rights or obligations thereunder.

     14.  Counterparts.  This Agreement may be executed by either of the parties
hereto in counterparts, each of which shall be deemed to be an original, but all
such counterparts shall together constitute one and the same instrument.

<PAGE>

     15.  Headings.  The  headings of sections  herein are  included  solely for
convenience of reference and shall not control the meaning or  interpretation of
any of the provisions of this Agreement.

     IN WITNESS  WHEREOF,  the Company has caused the  Agreement to he signed by
its officer  pursuant to the authority of its Board,  and Executive has executed
this Agreement, as of the day and year first written above.

                                        VIRTUAL REALITY, INC.

                                        By:  /s/  Martin F. Cardone
                                             ----------------------------------
                                             Name:  Martin F. Cardone
                                             Title: President

                                        /s/  Martin F. Cardone
                                        ---------------------------------------
                                        Martin F. Cardone
                                        "Executive"

                                        /s/  [ILLEGIBLE]
                                        ---------------------------------------
                                        Witnessed By

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