Document:

AGREEMENT

         AGREEMENT dated this 12th day of October, 1999, by and between
Kurchatov Research Holdings, Ltd., a Delaware corporation ("KRH"); and Alice
Schlattl, being the registered owner of record of all of the capitalization and
any and all other ancillary rights of Cetoni Umwelttechnologie Entwicklungs
GmbH, a close corporation organized pursuant to the Gesetz betreffend die
Gesellschaften mit beschrankter Haftung of the Federal Republic of Germany
("Cetoni"), as recorded in the Handelsregister of Cetoni is registered at
Amtsgericht Passau, Handelregister (Trade Register) Number HRB 5321 (Ms.
Schlattl may sometimes herein, be referred to as the "Registered Owner").

         This Agreement sets forth the terms and conditions upon which Alice
Schlattl will assign and transfer to KRH, and KRH will acquire from Alice
Schlattl, all of her right, title and interest in and to the authorized
capitalization of Cetoni registered in her name, representing the entire
authorized capitalization of Cetoni, as provided in Cetoni's certificate of
incorporation, and any and all ancillary rights attaching thereto (Alice
Schlattl's ownership interest in and ancillary rights thereto may sometimes
herein be referred to as the "Cetoni Share").

         Unless otherwise defined after their first use, capitalized terms and
certain German words have the meaning ascribed to them in ARTICLE II hereof

         In consideration of the mutual agreements contained herein, intending
to be legally bound hereby, the parties hereto agree as follows:

                                    ARTICLE I

                          SALE OF CETONI SHARE CAPITAL
                          ----------------------------

         1.01. INTEREST TO BE SOLD

             (a) Subject to the terms and conditions of this Agreement, the
Registered Owner hereby:

                  (i) sells to KRH, free and clear of all liens, charges,
options or encumbrances of whatsoever nature, all of her right, title and
interest in and to the Cetoni Share Capital, and KRH hereby accepts such sale of
the Cetoni Share, effective as of the date hereof;
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                  (ii) assigns the Cetoni Share to KRH free and clear of all
liens, charges, options or encumbrances of whatsoever nature, and KRH hereby
accepts such assignment of the Cetoni Share, effective as of the date hereof;

                  (iii) grants her consent, as the sole registered owner of all
of the Cetoni Share, by way of a shareholder's resolution adopted in accordance
with the provisions of Section 5 of the Cetoni Articles of Association, her
consent, to the sale, assignment and transfer of the Cetoni Share to KRH (which
is attached hereto as Exhibit A);

                  (iv) grants her consent, as the Geschaftsfuhrer of the
Gesellschaft, having the sole power of representation and not otherwise limited
by the restrictions of Section 181 of the German Civil Code, to the sale,
assignment and transfer of the Cetoni Share (which is attached hereto as Exhibit
B); and

                  (v) grants to KRH a power of attorney to notify and cause
Cetoni to transfer the Cetoni Share to KRH pursuant to paragraph 1 of Section 16
of the Gesetz betreffend die Gesellschaften mit beschrankter Haftung of the
Federal Republic of Germany (which is attached hereto as Exhibit C).

         1.02. CONSIDERATION (a) Subject to the terms and conditions of this
Agreement, in reliance on the representations, warranties and agreements of KRH
and the Registered Owner contained herein, and in consideration of the sale,
assignment and transfer of the Cetoni Share, referred to in Section 1.01 hereof,
KRH herewith delivers to the Record Owner 5,000,000 shares (the "Shares") of
KRH Stock (as hereafter defined), registered in the name of the Registered
Owner or in the names of her designee(s).

             (b) In the event that the audited financial, statements of Cetoni
for the period ended June 30, 1999, as shall be prepared in United States
Dollars in accordance with US GAAP, evidence liabilities of Cetoni on such date
in excess of 4.5 million German Deutsche marks, the Registered Owner shall
return to KRH for cancellation a number of the shares of KRH Stock delivered
pursuant to this Agreement as shall be calculated by dividing Cetoni's excess
liabilities, determined in reliance upon the above-referenced to be prepared
audited financial statements, by the average trading price per share of KRH
Stock over the five (5) trading days prior to the issuance of the Shares.

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             (c) The parties hereto recognize that the documents and other
information which the Registered Owner is furnishing to KRH herewith regarding
the business, financial condition and operations of Cetoni, including all
Exhibits and the information set forth in the Disclosure Schedule, are prepared
in German and that KRH is accepting such documents and is relying on the
representations and warranties of the Registered Holder herein with respect to
the information included in all such Exhibits and the Disclosure Schedule. In
the event that KRH determines, after having translated all such Exhibits and the
Disclosure Schedule, that there are any material misrepresentations relating to
the business, assets or financial condition of Cetoni, then KRH shall calculate
the monetary value attributable to such misrepresentation (which such
determination shall be based upon some tangible evidence or facts), if a
monetary value can be properly assigned thereto, and if no monetary value can be
assigned thereto, KRH shall negotiate in good faith with the Registered Owner to
determine a monetary value therefor, and the Registered Owner shall return to
KRH a number of shares of the KRH Common Stock delivered to the Registered Owner
hereunder as shall be calculated by dividing the monetary value assigned to such
misrepresentation by the average trading price per share of KRH Stock over the
five (5) trading days prior to the issuance of the Shares. If the monetary value
of any misrepresentation shall be determined by KRH because it has in its
possession evidence or facts which permit it make such determination, then it
shall furnish a copy of the documents upon which it is relying to make such
determination to the Registered Owner along with the notice demanding the return
of the shares of KRH Common Stock.

         1.03. DOCUMENTS TO BE DELIVERED HEREWITH. (a) The Registered Owner is
herewith delivering to KRH the following: (i) a copy of the notarial contract
evidencing the transfer and assignment of the Cetoni Share as filed with would
also be Amtsgericht Passau, Handelsregister. However, to my knowledge, there
has been no notorial contract signed yet, authenticated under German law, and
any other appropriate evidence that the Cetoni Share has been transferred,
assigned and registered in the Handelsregister in the name of KRH; (ii) the
opinion of counsel, a copy of the form of which is attached hereto as Exhibit E;
(iii) originally executed resolutions referred in Section l.0l(a)(iii);(iv) a
copy of the consent referred to in Section 1.0l(a)(iv); (v) the power of
attorney referred to in Section l.Ol(a)(v); (vi) the balance sheet referred to
in Section 3.06 hereof; (vii) all consents and other documents required pursuant
to Cetoni's jurisdiction of incorporation necessary to pass effectively title to
the Cetoni Stock to KRH, and (viii) all other previously undelivered

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documents required to be delivered by Cetoni to KRH pursuant to the provisions
of this Agreement and not heretofore received by KRH.

             (b) KRH is herewith delivering to the Registered Owner (i)
certificates evidencing 5,000,000 shares of KRH Stock registered in such names
and denominations as the Registered Owner may reasonably request; (ii) a
certified copy of the Certificate of Incorporation of KRH with Apostille
attached; and (iii) a duly executed power of attorney with Apostille attached
authorizing KRH's representative to execute this Agreement in behalf of KRH.

         1.04. FURTHER ASSURANCES. The Registered Owner hereby covenants and
agrees with KRH that after the Closing Date, she shall from time to time, at the
request of KRH and without further cost or expense to KRH, execute and deliver
such other instruments of assignment and do and take such other actions as KRH
may reasonably request, in order to more effectively consummate the transactions
contemplated hereby and to vest in KRH good title to the Cetoni Share being
transferred hereunder.

                                   ARTICLE II

                                 RELATED MATTERS
                                 ---------------

         2.01. CONFIDENTIALITY. Each party hereto will hold and will cause its
Affiliates, associates, consultants, representatives and advisors to hold in
strict confidence, unless compelled to disclose by judicial or administrative
process or, in the opinion of its counsel, by other requirements of law, all
documents and information concerning the other party furnished it by such other
party or its representatives in connection with the transactions contemplated by
this Agreement (except to the extent that such information can be shown to have
been (i) previously known by the party to which it was furnished, (ii) in the
public domain through no fault of such party, or (iii) later lawfully acquired
from other sources by the party to which it was furnished), and each party will
not release or disclose such information to any other person, except its
auditors, attorneys, financial advisors, bankers and other consultants and
advisors in connection with this Agreement. Such confidence shall be maintained,
except to the extent such information comes into the public domain through no
fault of the party required to hold it in confidence, and such information shall
not be used to the detriment of, or in relation to any investment in, the other
party arid all such documents (including copies thereof) shall be returned to
the other party immediately upon the written request

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of such other party. Each party shall, be deemed to have satisfied its
obligation to hold confidential information concerning or supplied by the other
party if it exercises the same care as it takes to preserve confidentiality for
its own similar information.

         2.02. DEFINITIONS. For all purposes of this Agreement, except as
otherwise expressly provided or unless the context otherwise requires:

         The terms "Affiliate' and "Associate" have the meanings prescribed by
Rule l2b-2 of the regulations promulgated pursuant to the Securities Exchange
Act.

         "Cetoni Articles of Association" means the Articles of Association
included in the Cetoni Certificate of Incorporation.

         "Cetoni Certificate of Incorporation" means the certificate of
incorporation of Cetoni as filed with the Handelsregister.

         "Closing Date' means the date of this Agreement.

         "DM" means the German Deutsche Mark.

         "Disclosure Schedule" Means the document delivered by the Registered
Owner to KRH simultaneously with the execution hereof containing the information
required to be included therein pursuant to this Agreement.

         "Gesetz betreffend die Gesellschaften mit beschrankter Haftung" means
the Limited Liability Companies Law of the Federal Republic of Germany.

         "Handelsregister" means the Commercial Register in which Cetoni and the
Cetoni Share is registered.

         "Organizational Documents" means, in the case of Cetoni, the
Certificate of Incorporation and Articles of Association, and the case of KRH,
the Certificate of Incorporation and By-laws.

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         "SEC" means the United States Securities and Exchange Commission.

         "Securities Act" means the Securities Act of 1933, as amended.

         "Securities Exchange Act" means the Securities Exchange Act of 1934, as
amended.

         "Subsidiary" (whether used on its own or in conjunction with other
defined terms) means any corporation of which any entity which is party to this
Agreement (a) directly or indirectly owns or controls at the time outstanding
shares of stock which have in ordinary circumstances (not dependent upon the
happening of a contingency) voting power to elect a majority of the board of
directors of said corporation, or (b) of which shares of stock of the character
described in the foregoing clause (a) shall at the time be owned or controlled
directly or indirectly by Cetoni or any Subsidiary of any of them as defined in
the foregoing clause (a) or by one or more such Subsidiaries.

         The plural of any defined term shall have a meaning correlative to such
defined term.

                                   ARTICLE III
          REPRESENTATIONS AND WARRANTIES OF THE REGISTERED OWNER
          ------------------------------------------------------

         The Registered Owner hereby represents, covenants and warrants to KRH
as follows:

         3.01. CORPORATE ORGANIZATION; ETC. Cetoni is a limited liability
corporation duly organized, validly existing and in good standing under the laws
of the Federal Republic of Germany and has full corporate power and authority to
carry on its business as it is now being conducted and to own the properties and
assets it now owns. The copies of the Organizational Documents of Cetoni
attached hereto as Exhibit D is a complete and correct copy of such instrument
as presently in effect. Cetoni is duly qualified or licensed, to do business as
a foreign corporation in good standing in every jurisdiction in which such
qualification is required, a list of which is set forth in Section 3.01 of the
Disclosure Schedule.

         3.02. CAPITALIZATION OF THE CETONI; OWNERSHIP OF CETONI SHARE. As of
the Closing Date, the nominal share capital of Cetoni consists of DM50,000
denominated into the equivalent of one share of capital stock in the nominal
amount of DM50,000 which has been registered in

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Handelsregister the name of the Registered Owner. The Cetoni Share has been
validly issued and is fully paid and is not subject to contribution of any kind.
The Cetoni Share has not been adversely affected, in whole or in part, by any
repayments to the Registered Owner. The Cetoni Share is not subject to any
rights of any third party.

         3.03. SUBSIDIARIES AND AFFILIATES. Section 3.03(a) of the Disclosure
Schedule sets forth the name, jurisdiction of incorporation and capitalization
of each subsidiary of Cetoni ("Cetoni Subsidiary") and the jurisdictions in
which each Cetoni Subsidiary is qualified to do business. Except as disclosed in
Section 3.03(b) of the Disclosure Schedule, Cetoni does not own, directly or
indirectly, any capital stock or other equity securities of any corporation or
have any direct or indirect equity or ownership interest in any business not
listed in Section 3.03(a) of the Disclosure Schedule. Except as and to the
extent set forth in Section 3.03(a) of the Disclosure Schedule, all the
outstanding capital stock of each Cetoni Subsidiary is owned directly or
indirectly by Cetoni free and clear of all liens, options or encumbrances of any
kind and all material claims or charges of any kind, and is validly issued,
fully paid and nonassessable, and there are no outstanding options, rights or
agreements of any kind relating to the issuance, sale or transfer of any capital
stock or other equity securities of any such Cetoni Subsidiary to any person
except the Company. Each Cetoni Subsidiary (i) is a corporation duly organized,
validly existing and in good standing under the laws of its state of
incorporation; (ii) has full corporate power and authority to carry on its
business as it is now being conducted and to own the properties and assets it
now owns; and (iii) is duly qualified or licensed to do business as a foreign
corporation in good standing in every jurisdiction in which such qualification
is required. Attached hereto as Exhibit G are complete and correct copies of the
incorporation and other governing documents in respect of each Cetoni
Subsidiary, as presently in effect, and the certificate(s) evidencing the
capital stock owned by Cetoni in each of said entities.

         3.04. POWER AND AUTHORITY; CONSENTS AND EFFECTIVE TRANSFER. (a) The
Registered Owner has full right, power, and authority to execute and deliver,
and to perform her obligations under, this Agreement and this Agreement and all
other documents to be delivered in accordance herewith, including, without
limitation, the power of attorney referred to in Section 1.0l(a)(v) hereof have
been duly executed and delivered by her and constitute her valid and binding
agreements and obligations under each such document. The Registered Owner has
obtained all consents of the persons or governmental entities necessary to
effectuate the sale, assignment and transfer of the Cetoni Share, including,
without limitation, (i) the consent of the shareholder of Cetoni pursuant to a
resolution adopted in accordance with the provisions of Sections of the Cetoni

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<PAGE>

Articles of Association and (ii) the consent, as the Geschaftsfuhrer of the
Gesellschaft, having the sole power of representation and not otherwise limited
by the restrictions of Section 181 of the German Civil Code, to the sale,
assignment and transfer of the Cetoni Share, each of which is valid and binding
under German law, all of which are listed in Section 3.04 of the Disclosure
Schedule.

             (b) Except for delivery and filing of certain documents being
executed by KRH or its representative described in Section 3.04 of the
Disclosure Schedule and which are being delivered herewith, as required under
German law and the Cetoni Organizational Documents, the Registered Owner has
taken all action required by German law, the Cetoni Organizational Documents or
otherwise necessary to effectuate the sale, assignment and transfer of the
Cetoni Share to KRH. Upon the filing and registration of the documents described
in Section 3.04 of the Disclosure Schedule by the Registered Owner with the
proper authorities, KRH will be the due and valid registered owner of the Cetoni
Share on the books and records of Cetoni and the Handelsregister.

         3.05. NO VIOLATION. Neither the execution and delivery of this
Agreement nor the consummation of the transactions contemplated hereby will
violate any provision of the Cetoni Organizational Documents, or, except as
specified in Section 3.05 of the Disclosure Schedule, violate, or be in conflict
with, or constitute a default (or an event which, with notice or lapse of time
or both, would constitute a default) under, or result in the termination of, or
accelerate the performance required by, or cause the acceleration of the
maturity of any debt or obligation pursuant to, or result in the creation or
imposition of any security interest, lien or other encumbrance upon any property
or assets of Cetoni under, any agreement or commitment to which Cetoni is a
party or by which Cetoni is bound, or to which the property of Cetoni is
subject, or violate any statute or law or any judgment, decree, order,
regulation or rule of any court or governmental authority.

         3.06. FINANCIAL STATEMENTS. Attached hereto as Exhibit H is an
unaudited balance sheet of Cetoni and the Cetoni Subsidiaries as at December 31,
1998 prepared and signed by management of Cetoni and certified that the balance
sheet is true and accurate at the date thereof (the "Cetoni Balance Sheet"). The
Cetoni Balance Sheet and the notes thereto are true, complete and accurate and
fairly present the assets, liabilities and financial condition of Cetoni and the
Cetoni Subsidiaries as at the date thereof.

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<PAGE>

         3.07. NO UNDISCLOSED LIABILITIES; ETC Except as described in Section
3.07 of the Disclosure Schedule, Cetoni has no liabilities or obligations of any
nature (absolute, accrued, contingent or otherwise) which were not fully
reflected or reserved against in the Cetoni Balance Sheet, including reserves
for all income and other taxes and all other liabilities of Cetoni at such
dates, except for liabilities and obligations incurred in the ordinary course of
business and consistent with past practice since the date thereof.

         3.08 ACCOUNTS RECEIVABLE. All, accounts receivable of Cetoni, whether
reflected in the Cetoni Balance Sheet or otherwise, represent sales actually
made in the ordinary course of business, and are current and collectible net of
any reserves shown on the Cetoni Balance Sheet (which reserves are adequate and
were calculated consistent with past practice). Subject to such reserve, each of
the accounts receivable either has been collected in full or will be collected
in full, without any set-off, within 120 days after the day on which it became
due and payable.

         3.09. INVENTORY. All inventory of Cetoni, whether reflected in the
Cetoni Balance Sheet or otherwise, consists of a quality and quantity usable
and salable in the ordinary course of business, except for items of obsolete
materials and materials of below-standard quality, all of which have been
written down in the Cetoni Balance Sheet to realizable market value or for which
adequate reserves have been provided therein. The quantities of all inventory of
Cetoni are reasonable and warranted in the present circumstances of their
respective businesses.

         3.1.0. INTERIM OPERATIONS. Since the date of the Cetoni Balance Sheet,
the business of Cetoni has been conducted only in the ordinary and usual course
consistent with past practice. Since the date of the Cetoni Balance Sheet, there
have not been any material adverse changes in the financial condition, assets or
results of operations of Cetoni. Since such date, such assets have not been
affected in any way as a result of flood, fire, explosion or other casualty
(whether or not covered by insurance). The Registered Owner is not of any
circumstances which may cause Cetoni to suffer any material adverse change in
its business, operations or prospects.

         3.11. ABSENCE OF CERTAIN CHANGES. Except as and to the extent set forth
in Section 3.11 of the Disclosure Schedule, since the date of the Cetoni Balance
Sheet, Cetoni has not:
             (a) Suffered any material adverse change in its working capital,
financial condition, assets, liabilities (absolute, accrued, contingent or
otherwise), reserves, business, operations or prospects;

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             (b) Incurred any liabilities or obligations (absolute, accrued,
contingent or otherwise) except non-material items incurred in the ordinary
course of business and consistent with past practice, or increased, or
experienced any change in any assumptions underlying or methods of calculating,
any bad debt, contingency or other reserves;

             (c) Paid, discharged or satisfied any claim, liabilities or
obligations (absolute, accrued, contingent or otherwise) other than the payment,
discharge or satisfaction in the ordinary course of business and consistent with
past practice or liabilities and obligations reflected or reserved against in
the Cetoni Balance Sheet or incurred in the ordinary course of business and
consistent with past practice since the date of the Cetoni Balance Sheet;

             (d) Permitted or allowed any of its property or assets (real,
personal or mixed, tangible or intangible) to be subjected to any mortgage,
pledge, lien, security interest, encumbrance, restriction or charge of any kind;

             (e) Written down the value of any inventory (including write-downs
by reason of shrinkage or mark-down) or written-off as uncollectible any notes
or accounts receivable, except for immaterial write-downs and write-offs in the
ordinary course of business and consistent with past practice;

             (f) Canceled any debts or waived any claims or rights of
substantial value;

             (g) Sold, transferred, or otherwise disposed of any of its
properties or assets (real, personal or mixed, tangible or intangible), except
in the ordinary course of business and consistent with past practice;

             (h) Disposed of or permitted to lapse any rights to the use of any
patent, trademark, trade name or copyright, or disposed of or disclosed (except
as necessary in the conduct of its business) to any person other than
representatives of KRH any trade secret, formula, process or know-how not
theretofore a matter of public knowledge;

             (i) Granted any general increase in the compensation of officers or
employees (including any such increase pursuant to any bonus, pension, profit
sharing or other plan

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or commitment) or any increase in the compensation payable or to become payable
to any officer or employee, and no such increase is customary on a periodic
basis or required by agreement or understanding;

             (j) Declared, paid or set aside for payment any dividend or other
distribution in respect of its capital stock or redeemed, purchased or otherwise
acquired, directly or indirectly, any shares of capital stock or other
securities of Cetoni.

             (l) Made any change in any method of accounting or accounting
practice;

             (m) Paid, loaned or advanced any amount to, or sold, transferred or
leased any properties or assets (real, personal or mixed, tangible or
intangible) to, or entered into any agreement or arrangement with, any of its
officers or directors or any affiliate or associate of any of its officers or
directors except for directors' fees, and compensation to officers at rates not
exceeding the rates of compensation paid during the year ended 1998; or

             (n) Agreed, whether in writing or otherwise, to take any action
described in this Section.

         3.12. TITLE TO PROPERTIES: ENCUMBRANCES. Cetoni has good, valid and
marketable title to all the properties and assets which it purports to own
(real, personal and mixed, tangible and intangible), including, without
limitation, all the properties and assets reflected in the Cetoni Balance Sheet,
and all the properties and assets purchased by Cetoni since the date of the
Cetoni Balance Sheet, which subsequently acquired properties and assets (other
than inventory) are listed in Section 3.12 of the Disclosure Schedule and copies
of legal title to all real property owned by Cetoni are attached hereto as
Exhibit I. All properties and assets reflected in the Cetoni Balance Sheet have
a fair market or realizable value at least equal to the value thereof as
reflected therein, and, except as disclosed in Section 3.12 of the Disclosure
Schedule, which such Section sets forth a list of all mortgages, liens and
encumbrances and the amounts outstanding under each of them, all such
properties and assets are free and clear of all title defects or objections,
liens, claims, charges, security interests or other encumbrances of any nature
whatsoever including, without limitation leases, chattel mortgages, conditional,
sales contracts, collateral security arrangements and other title or interest
retention arrangements. The rights, properties and other assets presently owned,
leased or licensed by Cetoni and described elsewhere in this Agreement include
all rights, properties and

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other assets necessary to permit Cetoni to conduct its business in all material
respects in the same manner as its business has been conducted prior to the date
hereof. The transactions contemplated by this Agreement will not constitute an
event of default under any mortgage, lien or encumbrance on any of the property
of Cetoni.

         3.13. PLANT AND EQUIPMENT. Section 3.13(a) of the Disclosure Schedule
contains an accurate and complete description of all plants, structures,
equipment and other items having a value in excess of DM25,000 used by Cetoni in
the operation of its business. The plants, structures and equipment of Cetoni
are structurally sound with no defects and are in good operating condition and
repair and are adequate for the uses to which they are being put; and none of
such plants, structures or equipment are in need of maintenance or repairs
except for ordinary, routine maintenance and repairs which are not material in
nature or cost. Except as set forth in Section 3.13(b) of the Disclosure
Schedule, neither Mrs. Schlattl nor Cetoni has received notification that Cetoni
is in violation of any applicable building, zoning, anti-pollution, health or
other law, ordinance or regulation in respect of its plants or structures or
their operations and no such violation exists.

         3.14. PATENTS TRADEMARKS, TRADE NAMES, ETC. Cetoni owns, or is licensed
or otherwise has the full and exclusive right to use, all patents, trademarks,
trade names, copyrights, technology, know-how and processes used in or necessary
for the conduct of the business as heretofore conducted. Section 3.14 of the
Disclosure Schedule contains an accurate and complete description of (a) all
patents, trademarks, trade names and copyrights used or proposed to be used by
Cetoni, all applications therefor, and a summary of the terms of all licenses
and other agreements relating thereto and (b) a summary of the terms of all
agreements relating to technology, know-how or processes which Cetoni is
licensed or authorized to use by others. Except as set forth in Section 3.14 of
the Disclosure Schedule, Cetoni has the sole and exclusive right to use the
patents, trademarks, trade names, copyrights, technology, know-how, intellectual
property and processes referred to in the Disclosure Schedule, and the
consummation of the transactions contemplated hereby will not alter or impair
any such rights; no claims have been asserted by any person to the use of any
such patents, trademarks, trade names, copyrights, technology, know-how,
intellectual property or processes or challenging or questioning the validity or
effectiveness of any such license or agreement, and Mrs. Schlattl does not know
of any valid basis for any such claim; and the use of such patents, trademarks,
trade names, copyrights, technology, intellectual property, know-how or
processes by Cetoni does not infringe on the rights of any person.

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         3.15. LEASES. Section 3.15 of the Disclosure Schedule contains an
accurate and complete description, of the terms of all leases pursuant to which
Cetoni leases real or personal property and copies of each such lease are
attached hereto as Exhibit J. Except as set forth in Section 3.15 of the
Disclosure Schedule, all such leases are valid, binding and enforceable in
accordance with their terms, and are in full force and effect; there are no
existing defaults by Cetoni thereunder; no event of default has occurred which
(whether with or without notice, lapse of time or the happening or occurrence of
any other event) would constitute a default thereunder; and all lessors under
such leases have consented (where such consent is necessary) to the consummation
of the transactions contemplated by this Agreement without requiring
modification in the rights or obligations of the lessee under such leases.
Executed counterpart copies of all consents referred to in the preceding
sentence are being delivered to KRH herewith and are included in Exhibit K.

         3.16. BANK ACCOUNTS. Section 3.16 of the Disclosure Schedule sets forth
the names and locations of all banks, trust companies, savings and loan
associations and other financial institutions at which Cetoni maintains safe
deposit boxes or accounts of any nature and the names of all persons authorized
to draw thereon, make withdrawals therefrom or have access thereto. Cetoni is
herewith delivering to KRH as Exhibit L copies of all records, including all
signature or authorization cards, pertaining to such bank accounts.

         3.17. TAXES. Cetoni duly filed all tax reports and returns required to
be filed by it and has duly paid all taxes and other charges due or claimed to
be due from it by federal, state, local or foreign taxing authorities
(including, without limitation, those due in respect of the properties, income,
franchises, licenses, sales or payrolls of any of it); the reserves for taxes
reflected in the Cetoni Balance Sheet are adequate; and there are no tax liens
upon any property or assets of Cetoni.

         3.18. CONTRACTS AND COMMITMENTS. Section 3.18 of the Disclosure
Agreements sets forth a list of all "Material Contracts" to which Cetoni is
party or from which material rights and privileges inure to or obligations which
are the responsibility of, Cetoni, copies of which such agreements are attached
hereto as Exhibit M. For purposes hereof, the term "Material Contracts"
includes all material contracts and commitments all indentures, mortgages,
security agreements, leases loan and credit agreements, and all other material
agreements (including employment agreements or deferred compensation, pension,
profit sharing or retirement plans, supply contracts or contracts for the
purchase or sale of products or services), oral or written, imposing any
obligation on Cetoni or to which its properties are subject. A contract,
commitment or agreement shall be

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deemed to be material if it either (i) involves or may involve the payment of
more than DM25,000 over the life of the contract or commitment or (ii)
regardless of the amount involved, if it is not terminable without penalty
solely at the will of Cetoni upon notice of thirty days or less. Said list is
true and correct in all material respects; and, except as disclosed thereon,
Cetoni is not bound by any Material Contract whatsoever. Except as set forth in
Section 3.18 of the Disclosure Schedule:

             (a) Cetoni has no agreements, contracts, commitments or
restrictions which are material to its business, operations or prospects or
which require the making of any charitable contribution;

             (b) No purchase contracts or commitments of Cetoni continue for a
period of more than 12 months or are in excess of the normal, ordinary and usual
requirements of business or at any excessive price;

             (c) There are no outstanding sales contracts, commitments or
proposals of Cetoni which continue for a period of more than 12 months or will
result in any loss to Cetoni upon completion or performance thereof, after
allowance for direct distribution expenses;

             (d) Cetoni has no outstanding contracts with officers, employees,
agents, consultants, advisors, salesmen, sales representatives, distributors or
dealers that are not cancelable by it on notice of not longer than 30 days and
without liability, penalty or premium;

             (e) Cetoni has no employment agreement, or any other agreement that
contains any severance or any severance or termination pay liabilities or
obligations;

             (f) Cetoni has no collective bargaining or union contracts or
agreements;

             (g) Cetoni is not in default, nor is there any known basis for any
valid claim of default, under any contract made or obligation owed by it;

             (h) Cetoni is not restricted by agreement from carrying on its
business anywhere in the world;

                                      -14-
<PAGE>

             (i) Cetoni is under no liability or obligation with respect to the
return of inventory or merchandise in the possession of wholesalers,
distributors, retailers or their customers;

             (j) Cetoni has no debt obligation for borrowed money, including
guarantees of or agreements to acquire any such debt obligation of others;

             (k) Cetoni has no outstanding loan to any person; and

             (1) Cetoni has no power of attorney outstanding or any obligations
or liabilities (whether absolute, accrued, contingent or otherwise), as
guarantor, surety, co-signer, endorser, co-maker, indemnitor or otherwise in
respect of the obligation of any person, corporation, partnership, joint
venture, association, organization or other entity.

         3.19. CUSTOMERS AND SUPPLIERS. Sections 3.19(a) and (b), respectively,
of the Disclosure Schedule sets forth: (a) a list of the three largest customers
of Cetoni in terms of sales during the fiscal year December 31, 1999, and (b) a
list of the three largest suppliers of Cetoni in terms of purchases during the
fiscal year ended December 31, 1999. Except to the extent set forth in Section
3.19(c) of the Disclosure Schedule, there has not been any material adverse
change in the business relationship of Cetoni with any customer or supplier
named in Sections 3.19(a) and 3.19(b) of the Disclosure Schedule. Except for the
customers and suppliers named in Sections 3.19(a) and 3.19(b) of the Disclosure
Schedule, Cetoni has had no customer which accounted for more than 5% of
Company's sales during the period from 1997 to December 31, 1999, or any
supplier from whom it purchased more than 5% of the goods or services which it
purchased during the period 1997 to December31, 1999.

         3.20. ORDERS, COMMITMENTS AND RETURNS. As of the date of this
Agreement, the aggregate of all accepted and unfulfilled orders for the sale of
merchandise entered into by Cetoni approximates DM -0-, and the aggregate of all
contracts or commitments for the purchase of supplies by them approximates
DM333,000 all of which orders, contracts and commitments were made in the
ordinary course of business. As of the date of this Agreement, there are no
claims against Cetoni to return in excess of an aggregate of DM -0- of
merchandise by reason of alleged overshipments, defective merchandise or
otherwise, or of merchandise in the hands of customers under an understanding
that such merchandise would be returnable.

                                      -15-
<PAGE>

         3.21. AGREEMENTS IN FULL FORCE AND EFFECT. All contracts, agreements,
plans, leases, policies and licenses referred to in the Disclosure Schedule are
valid and in full force and effect, and true copies thereof heretofore have been
or will, prior to the Closing, be made available to KRH.

         3.22. INSURANCE. Section 3.22(a) of the Disclosure Schedule contains an
accurate and complete description of all material policies of fire, liability,
workmen's compensation and other forms of insurance owned or held by Cetoni,
copies of which such policies are attached hereto as Exhibit N. All such
policies are in full force and effect, all premiums with respect thereto
covering all periods up to and including the date hereof have been paid, and no
notice of cancellation or termination has been received with respect to any such
policy. Such policies are sufficient for compliance with all requirements of law
and of all agreements to which Cetoni is a party; are valid, outstanding and
enforceable policies; provide adequate insurance coverage for the assets and
operations of Cetoni; will remain in full force and effect through the
respective dates set forth in Section 3.22(a) of the Disclosure Schedule without
the payment of additional premiums; and will not in any way be affected by, or
terminate or lapse by reason of, the transactions contemplated by this
Agreement.

         3.23. LABOR DIFFICULTIES. Except to the extent set forth in Section
3.23 of the Disclosure Schedule, (a) Cetoni is in compliance with all applicable
laws respecting employment and employment practices, terms and conditions of
employment and wages and hours, and are not engaged in any unfair labor
practice; (b) there is no unfair labor practice complaint against Cetoni pending
before any government agency; (c) there is no labor strike, dispute, slowdown or
stoppage actually pending or threatened against or affecting Cetoni; and (d)
Cetoni has not experienced any work stoppage or other labor difficulty since
1996.

         3.24. LITIGATION. Except as set forth in Section 3.24 of the Disclosure
Schedule, there is no action, suit, inquiry, proceeding or investigation by or
before any court or governmental or other regulatory or administrative agency or
commission pending or to the best knowledge of Cetoni, threatened against or
involving Cetoni, or which questions or challenges the validity of this
Agreement or any action taken or to be taken by Cetoni pursuant to this
Agreement or in connection with the transactions contemplated hereby; and Cetoni
does not know or have any reason to know of any valid basis for any such action,
proceeding or investigation. Except as set forth in Section 3.24 of the
Disclosure Schedule, Cetoni is not in default under or in violation of, nor is
there nor does it know of any valid basis for any claim of default under or
violation of, any contract, commit-

                                      -16-
<PAGE>

ment or restriction to which it is a party or by which it is bound. Cetoni is
not subject to any judgment, order or decree entered in any lawsuit or
proceeding which may have an adverse effect on its business practices or on its
ability to acquire any property or conduct its business in any area. Copies of
all papers relating to any litigation described in Section 3.24 of the
Disclosure Schedule are attached hereto as Exhibit O.

         3.25. CONSENTS AND APPROVALS OF GOVERNMENTAL AUTHORITIES Except as
provided in Section 3.04 and as otherwise set forth and described in Section
3.25 of the Disclosure Schedule, no consent, approval, or authorization of, or
declaration, filing or registration with, any governmental or regulatory
authority is required in connection with the execution, delivery and performance
of this Agreement or the consummation of the transactions contemplated hereby.
Copies of any consents described in Section 3.25 are attached hereto as Exhibit
P.

         3.26. ENVIRONMENTAL PROTECTION. Except as set forth in Section 3.26 of
the Disclosure Schedule, Cetoni has obtained all permits, licenses and other
authorizations which are required under national and local laws relating to
pollution or protection of the environment, including laws relating to
emissions, discharges, releases or threatened releases of pollutants,
contaminants, or hazardous or toxic materials or wastes into ambient air,
surface water, ground water, or land, or otherwise relating to the manufacture,
processing, distribution, use, treatment, storage, disposal, transport, or
handling of pollutants, contaminants or hazardous or toxic materials or wastes.
Except as set forth in Section 3.26 of the Disclosure Schedule, Cetoni is in
full compliance with all terms and conditions of the required permits, licenses
and authorizations, and are also in full compliance with all other limitations,
restrictions, conditions, standards, prohibitions, requirements, obligations,
schedules and timetables contained in those laws or contained in any regulation,
code, plan, order, decree, judgment, notice or demand letter issued, entered,
promulgated or approved thereunder. Except as set forth in Section 3.26 of the
Disclosure Schedule, neither Mrs. Schlattl nor Cetoni is aware of, nor has
either Schlattl or Cetoni received notice of, any past, present or future
events, conditions, circumstances, activities, practices, incidents, actions or
plans which may interfere with or prevent continued compliance, or which may
give rise to any legal liability, or otherwise form the basis of any claim,
action, suit, proceeding, hearing or investigation, based on or related to the
manufacture, processing, distribution, use, treatment, storage, disposal,
transport, or handling, or the emission, discharge, release or threatened
release into the environment, of any pollutant, contaminant, or hazardous or
toxic material or waste.

                                      -17-
<PAGE>

         3.27. CONSENTS. Except as set forth in Section 3.04, 3.15 and 3.25 of
the Disclosure Schedule, no consent of any person is necessary to the
consummation of the transactions contemplated hereby, including, without
limitation, consents from parties to loans, contracts, leases or other
agreements.

         3.29 COMPLIANCE WITH LAW. The operations of Cetoni have been conducted
in accordance with all applicable laws, regulations and other requirements of
all national governmental authorities, and of all states, municipalities and
other political subdivisions and agencies thereof, having jurisdiction over
Cetoni, including, without limitation, all such laws, regulations and
requirements relating to antitrust, consumer protection, currency exchange,
equal opportunity, health, occupational safety, pension, securities and
trading-with-the-enemy matters. Neither Mrs. Schlattl nor Cetoni has not
received any notification of any asserted present or past failure by Cetoni to
comply with such laws, rules or regulations.

         3.30. BROKERS AND FINDERS. Neither Cetoni nor any of its officers,
directors or employees has employed any broker or finder or incurred any
liability for any brokerage fees, commissions or finders' fees in connection
with the transactions contemplated by this Agreement.

         3.31. RESTRICTIONS ON TRANSFER OF KRH STOCK (a) The Registered Owner
acknowledges and agrees that (i) the Shares have not been registered under the
Securities Act or any state securities laws and are issued in reliance upon
certain exemptions included in federal and state securities laws from such
registration, (ii) there are substantial restrictions on the sale of the Shares
and the Shares may be transferred only in accordance with the provisions of
Section 3.31(b), below, and (iii) each certificate representing the Shares
issuable hereunder and any other securities issued in respect of the Shares,
upon any stock split, stock dividend, recapitalization, merger, consolidation or
similar event, shall (unless otherwise permitted or unless the shares of KRH
Stock evidenced by such certificate shall have been registered under the
Securities Act) also be stamped or otherwise imprinted with a legend
substantially in the following form (in addition to any legend required under
applicable state securities laws):

                        "THESE SECURITIES HAVE NOT BEEN
                        REGISTERED UNDER THE SECURITIES ACT OF
                        1933 OR ANY STATE SECURITIES LAWS. THEY
                        MAY NOT BE SOLD OR OFFERED FOR SALE IN
                        THE ABSENCE OF AN EFFECTIVE
                        REGISTRATION STATEMENT AS TO THE

                                      -18-
<PAGE>

                        SECURITIES UNDER SAID ACT AND ANY
                        APPLICABLE STATE SECURITIES LAW OR AN
                        OPINION OF COUNSEL SATISFACTORY TO
                        THE COMPANY THAT SUCH REGISTRATION 1S
                        NOT REQUIRED."

             (b) The Registered Owner acknowledges and agrees that the Shares
may be transferred only upon (i) registration under the Securities Act, (ii) the
receipt by KRH of an opinion of counsel acceptable to KRH (including then
counsel to KRH) that such transfer is exempt from the registration provisions of
the Securities Act and state securities laws (if any such transfer is to be made
into any state of the United States) or (ii) the receipt by KRH of a "no-action"
letter form the SEC to the effect that any transfer by such holder of the
securities evidenced by such certificate will not violate the Securities Act and
applicable state securities laws.

         3.32. NO REGISTRATION OF SHARES. The Registered Owner acknowledge that
Shares have not been registered under the Act, and that, except as provided in
Article V hereof, KRH is under no obligation to register the Shares in behalf of
the Registered Owner.

         3.33. DISCLOSURE. No representations or warranties made by Cetoni or
the Record Owners in this Agreement and no statement contained in any document
(including, without limitation, the financial statements, Exhibits hereto and
the Disclosure Schedule), certificate, or other writing furnished or to be
furnished by Cetoni and the Record Owners to KRH or any of its representatives
pursuant to the provisions hereof or in connection with the transactions
contemplated hereby, contains or will contain any untrue statement of material
fact or omits or will omit to state any material fact necessary, in light of
the circumstances under which it was made, in order to make the statements
herein or therein not misleading.

                                   ARTICLE IV
                      REPRESENTATIONS AND WARRANTIES OF KRH
                      -------------------------------------

         KRH hereby represents, covenants and warrants to the Registered Owner
as follows:

                                      -19-
<PAGE>

         4.01. CORPORATE ORGANIZATION; ETC KRH is a corporation duly organized,
validly existing and in good standing under the laws of the State of Delaware
and has full corporate power and authority to carry on its business as it is now
being conducted and to own the properties and assets it now owns. The copies of
the Certificate of Incorporation and By-Laws of KRH attached hereto as Exhibits
J and K, respectively, are complete and correct copies of such instruments as
presently in effect.

         4.02. CAPITALIZATION OF KRH. As of the date of this Agreement, the
authorized capital stock of KRH consists of 50,000,000 shares of Common Stock,
$.00l par value per share ("KRH Stock"), of which 16,505,911 shares are issued
and outstanding and no shares are held in the treasury of KRH. All issued and
outstanding shares of capital stock of KRH are validly issued, fully paid and
nonassessable. Except as described in Section 4.02 of the Disclosure Schedule,
there are no outstanding (a) securities convertible into or exchangeable for KRH
Stock or any securities of Cetoni; (b) options, warrants or other rights to
purchase or subscribe to Cetoni Stock or any securities of Cetoni; or (c)
contracts, commitments, agreements, understandings or arrangements of any kind
relating to the issuance of any for KRH Stock or any securities of KRH, any such
convertible or exchangeable securities or any such options, warrants or rights.

         4.03. AUTHORIZATION, ETC KRH has full corporate power and authority to
enter into this Agreement and to carry out the transactions contemplated hereby.
The Board of Directors of KRH has taken all action required by law, KRH's
Certificate of Incorporation, its By-Laws or otherwise to be taken by them to
authorize the execution and delivery of this Agreement and the consummation of
the transactions contemplated hereby, and this Agreement is a valid and binding
agreement of KRH enforceable in accordance with its terms, except that (i) such
enforcement may be subject to bankruptcy, insolvency, reorganization, moratorium
or other similar laws now or hereafter in effect relating to creditors' rights,
and (ii) the remedy of specific performance and injunctive and other forms of
equitable relief may be subject to equitable defenses and to the discretion of
the court before which any proceeding therefore may be brought.

         4.04. NO VIOLATION. Neither the execution and delivery of this
Agreement nor the consummation of the transactions contemplated hereby will
violate any provision of the Certificate of Incorporation or By-Laws of KRH, or
violate, or be in conflict with, or constitute a default (or an event which,
with notice or lapse of time or both, would constitute a default) under, any
agreement or commitment to which KRH is a party or by which KRH is bound, or
to which the

                                      -20-
<PAGE>

property of KRH is subject, or violate any statute or law or any judgment,
decree, order, regulation or rule of any court or governmental authority.

         4.05. LITIGATION. There is no action, suit, inquiry, proceeding or
investigation by or before any court or governmental or other regulatory or
administrative agency or commission pending or, to the best knowledge of KRH,
threatened against or involving KRH, or which questions or challenges the
validity of this Agreement or any action taken or to be taken by KRH pursuant to
this Agreement or in connection with the transactions contemplated hereby; and
KRH does not know or have any reason to know of any valid basis for any such
action, proceeding or investigation. KRH is not subject to any judgment, order
or decree entered in any lawsuit or proceeding which may have an adverse effect
on its business practices or on its ability to acquire any property or conduct
its business in any area.

         4.06. CONSENTS AND APPROVALS OF GOVERNMENTAL AUTHORITIES. No consent,
approval or authorization of, or declaration, filing or registration with, any
governmental or regulatory authority is required in connection with the
execution, delivery and performance of this Agreement or the consummation of the
transactions contemplated hereby.

         4.07. CONSENTS. No consent of any person is necessary to the
consummation of the transactions contemplated hereby.

         4.08. FINANCIAL STATEMENTS. Attached hereto as Exhibit K are: (i)
audited financial statements of KRH for the fiscal years ended December 31,
1996, 1997 and 1998, including balance sheets; and consolidated statements of
operations, changes in stockholders' equity and statements of cash flow for each
of the years then ended (the "KRH Financial Statements"); and (ii) an unaudited
balance sheet of KRH (the "KRH Balance Sheet"), all prepared in accordance with
generally accepted accounting principles consistently applied throughout the
periods in question. The KRH Financial Statements and the notes thereto are
true, complete and accurate and fairly present the assets, liabilities and
financial condition of KRH as at the respective dates thereof and such
statements of income, changes in stockholders' equity and changes in cash flows
and the notes thereto are true, complete and accurate and fairly present the
results of operations for the periods therein referred to; all in accordance
with generally accepted accounting principles consistently applied throughout
the periods involved.

                                      -21-
<PAGE>

         4.09. NO UNDISCLOSED LIABILITIES; ETC. KRH has no liabilities or
obligations of any nature (absolute, accrued, contingent or otherwise) which
were not fully reflected or reserved against in its KRH Balance Sheet, except
for liabilities and obligations incurred in the ordinary course of business and
consistent wit past practice since the date thereof

         4.10. COMPLIANCE WITH LAW. The operations of KRH have been conducted
in accordance with all applicable laws, regulations and other requirements of
all national governmental authorities, and of all states, municipalities and
other political subdivisions and agencies thereof, having jurisdiction over KRH,
including, without limitation, all such laws, regulations and requirements
relating to antitrust, consumer protection, currency exchange, equal
opportunity, health, occupational safety, pension, securities and
trading-with-the-enemy matters. KRH has not received any notification of any
asserted present or past failure by KRH to comply with such laws, rules or
regulations.

         4.11. BROKERS AND FINDERS. Neither KRH nor any of its officers,
directors or employees has employed any broker or finder or incurred any
liability for any brokerage fees, commissions or finders' fees in connection
with the transactions contemplated by this Agreement.

         4.12. DISCLOSURE. No representations or warranties by KRH in this
Agreement and no statement contained in any document (including, without
limitation, financial statements and the Disclosure Schedule), certificate, or
other writing furnished or to be furnished by KRH to Cetoni or any of its
representatives pursuant to the provisions hereof or in connection with the
transactions contemplated hereby, contains or will, contain any untrue statement
of material fact or omits or will omit to state any material fact necessary, in
light of the circumstances under which it was made, in order to make the
statements herein or therein not misleading.

                                    ARTICLE V
                             REGISTRATION OF SHARES
                             ----------------------

                  5.01.   REGISTRATION RIGHTS WITH RESPECT TO THE SHARES.

                                      -22-
<PAGE>
             (a) FILING OF REGISTRATION STATEMENT. KRH will use its best efforts
to file, within 180 days from the Closing Date hereof a registration statement
under the Securities Act which will include the Shares (the "Registration
Statement"), and, subject to its right to withdraw such filing as described
below, shall use its best efforts to cause the effectiveness of the Registration
Statement within ninety (90) days after the filing of said Registration
Statement. Any such Registration Statement may include other shares of KRH Stock
which KRH is obligated to register including shares of KRH Stock underlying
certain, convertible debentures and common stock purchase warrants issued during
March and April of 1999. KRH shall maintain the effectiveness of the
Registration Statement until the expiration of a period which is two years after
the Registration Statement is declared effective by the SEC or such earlier date
when all Shares have been sold or may be sold without volume restrictions
pursuant to Rule 144(k) promulgated under the Securities Act, as determined by
the counsel to KRH pursuant to a written opinion letter to such effect,
addressed and acceptable to KRH's transfer agent.

                  (b) (i) Notwithstanding the provisions of Section 5.01(a),
above, if the Shares are to be included in a Registration Statement in which KRH
proposes to offer shares of Common Stock in connection with an underwritten
public offering, KRH shall promptly notify the Registered Owner and any other
holders of the Shares (all of whom, including the Registered Owner, for purposes
of this Article V are referred to as "Holders") as to its selection of
investment bankers for the offering. If the managing underwriters for the
offering advise KRH in writing that in their good faith opinion the number of
shares of KRH Stock being registered in behalf of the Holders as well as the
other persons for whom KRH is registering shares, when aggregated with the other
securities to be registered by said Registration Statement exceeds that which
can be sold in an orderly manner in such offering, KRH shall include in such
registration, first, the securities which KRH proposes to sell, second shares of
KRH Stock issuable upon the conversion of the certain convertible debentures and
common stock purchase warrants described in Section 4.02 of the Disclosure
Schedule and, thereafter, shall use its best efforts to have all such Shares
included in said Registration Statement subject to the provision that the
Holders shall agree to lock-up all Shares, for a period not to exceed ninety
(90) days from the date the Registration Statement is declared effective by the
Commission, which the managing underwriter believes, in its good faith opinion,
it cannot sell. In the event that KRH is obligated to register shares of KRH
Stock in behalf of other persons, the Shares shall be aggregated with such
shares and KRH will register on behalf of the Holders a number of shares of KRH
Stock as shall be equal to the percentage the Shares represents to the total
number of shares which the managing underwriters may allow KRH to register in
the

                                      -23-
<PAGE>

offering after deducting the total number of shares which are being registered
in behalf of the holders of the convertible debentures and common stock purchase
warrants, who shall have first priority to register shares of KRH Stock issuable
to them.

                  (ii) In the event that KRH can not register all of the Shares
in the Registration Statement for the reasons described above, it shall, within
ninety (90) days of the effective date of said Registration Statement and
subject to the provisions of any underwriting agreement to which it is a party
in connection, with the registration of the capital stock it offered on its own
behalf, use its best efforts to file a Registration Statement covering the
balance of the Shares not registered in the Registration Statement described in
Section 5.01(a), and will use its best efforts to cause such Registration
Statement to be declared effective within ninety (90) days of the filing
thereof.

             (c) POSTPONEMENT OF EFFECTIVE DATE OF REGISTRATION STATEMENT. KRH
will be entitled to postpone or interrupt the effective date of any Registration
Statement filed in connection with such registration (and the use of the
prospectus contained therein) if KRH determines, in its best judgment, after
consultation with counsel, that such registration statement would require the
premature announcement of any material financing, acquisition, corporate
reorganization or other material corporate transaction or development involving
KRH which, in KRH's reasonable determination, would be materially detrimental to
the interests of KRH and its stockholders. Any such postponement or interruption
will be for a minimum period reasonably required to avoid such premature
disclosure. KRH promptly will give the Holders notice of such postponement or
interruption.

             (d) ADDITIONAL REGISTRATION PROCEDURES. In connection with KRH's
obligations to file a Registration Statement, it shall:

                  (i) Notify the Holders promptly after it shall receive notice
thereof, of the time when such Registration Statement has become effective with
the SEC or a supplement to any prospectus forming a part of such Registration
Statement has been filed;

                  (ii) Notify the Holders of any request by the SEC for the
amending or supplementing of such Registration Statement or prospectus or for
additional information;

                                      -24-
<PAGE>

                  (iii) Prepare and file with the SEC such amendments and
supplements to such Registration Statement and prospectus used in connection
therewith as may be necessary to keep such Registration Statement effective and
to comply with the provisions of the Securities Act with respect to the offer of
Shares covered by such Registration Statement during the period required for
distribution of such Shares, as provided in Section 5.01(a), above;

                  (iv) Furnish to the Holders such number of copies of the
prospectus (including any preliminary prospectus or supplemental or amended
prospectus) as the Holders may reasonably request in order to facilitate the
sale and distribution of the Shares.

                  (v) Prepare and file promptly with the SEC, and promptly
notify the Holders of the filing of, such amendment or supplement to such
Registration Statement or prospectus as may be necessary to correct any untrue
statements of fact or omissions to state any facts necessary to make the
statements therein not misleading in light of the circumstances in which they
were made;

                  (vi) Advise the Holders, promptly after it receives notice or
obtains knowledge thereof, of the issuance of any stop order by the SEC
suspending the effectiveness of such Registration Statement or the initiation or
threatening of any proceeding for that purpose and promptly use its best efforts
to prevent the issuance of any stop order or to obtain its withdrawal if such
stop order should be issued;

                  (vii) Prepare and file with the SEC, promptly upon the request
of any of the Holders, any amendments or supplements to such Registration
Statement or prospectus which, in the opinion of counsel for the Holders, is
required under the Securities Act or the rules and regulations thereunder in
connection with the distribution of the Shares by the Holders;

                  (viii) Make available for inspection by the Holders and any
underwriter participating in any disposition of the Shares pursuant to such
Registration Statement, and any attorney, accountant or other agent retained by
any underwriter, or the Holders, all financial and other records, pertinent
corporate documents and properties of KRH, and cause KRH's officers,
directors, employees and independent accountants to supply all information
reasonably requested by the Holders, any such underwriter, attorney, accountant
or agent in connection with such Registration Statement; and

                                      -25-
<PAGE>

                  (ix) Use its best efforts to register or qualify the Shares
covered by each Registration Statement under such state securities or blue sky
laws of such jurisdictions as the Holders and any underwriters may reasonably
request; provided, that KRH shall not be required to execute any general
consent to service of process or to qualify to do business as a foreign
corporation in any jurisdiction where it is not so qualified and provided
further that any such qualification or registration shall not exceed $5,000 for
any one jurisdiction.

             (e) KRH may require the Holders to furnish to KRH such information
regarding the distribution of such Registrable Securities and the beneficial
ownership of the Shares as is required by law to be disclosed in the
Registration Statement and KRH may exclude from such registration Shares of any
holder who unreasonably fails to furnish such information within a reasonable
time after receiving such request.

             (f) If the Registration Statement refers to any holder of Shares by
name or otherwise as the holder of any securities of KRH, then such holder of
Shares shall have the right to require (if such reference to such holder of
Shares by name or otherwise is not required by the Securities Act or any similar
Federal statute then in force) the deletion of the reference to such holder in
any amendment or supplement to the Registration Statement filed or prepared
subsequent to the time that such reference ceases to be required.

             (g) Each holder of Shares agrees by its acquisition of such Shares
that (i) it will not offer or sell any Shares under the Registration Statement
until it has received copies of the prospectus included in the Registration
Statement as then amended or supplemented and notice from KRH that such
Registration Statement and any post-effective amendments thereto have become
effective and that such holder will comply with the prospectus delivery
requirements of the Securities Act as applicable to it in connection with sales
of Shares pursuant to the Registration Statement, (ii) it will sell only ten
percent (10%) of the total number of Shares owned by them during each six (6)
month period after the effectiveness of the Registration Statement, which such
covenant shall continue in effect after such time as the Shares may be sold
pursuant to the provisions of Rule 144(k).

             (h) Each holder of Shares agrees by its acquisition of such Shares
that, upon receipt of a notice from KRH of the occurrence of any event of the
kind described in this Section

                                      -26-
<PAGE>

5,01 such holder will forthwith discontinue disposition of Shares until such
Holders receipt of the copies of the supplemented prospectus and/or amended
Registration Statement or until it is advised in writing by KRH that the use of
the applicable prospectus may be resumed.

             (i) EXPENSES. All expenses incident to KRH's performance of or
compliance with this undertaking in this Section 5.01, including without
limitation all registration and filing fees (other than registration and filing
fees in excess of $5,000 imposed by state securities or blue sky laws), printing
expenses, messenger and delivery expenses, and fees and disbursements of
counsel for KRH and all independent certified public accountants, underwriters
(excluding discounts and commissions) and other persons retained by KRH (all
such expenses being herein called "Registration Expenses"), will be borne by
KRH. KRH will, in all events, pay its internal expenses (including, without
limitation, all salaries and expenses of its officers and employees performing
legal or accounting duties), the expense of any annual audit and the expense of
any liability insurance. KRH shall not be responsible for any commission or
selling expenses incurred by the holders of Shares, fees of counsel or
accountants retained by holders of the Shares or of any other fees not
specifically referenced above.

             (j) REPORTING REQUIREMENTS UNDER THE SECURITIES EXCHANGE ACT OF
1934. At such time as KRH becomes subject to the reporting requirements of the
Exchange Act, it shall timely file all such information, documents, and reports
as the Commission may require or prescribe under either Section 13 or 15(d)
(whichever is applicable) thereof KRH shall, whenever requested by the
Holders, notify the Holders, in writing whether KRH has, as of the date
specified by the Holders, complied with the Exchange Act reporting requirements
to which it is subject for a period prior to such date as shall be specified by
the Holders. KRH acknowledges and agrees that the purposes of the requirements
contained in this Section 5.01(j) are: (i) to enable the Holders to comply with
the current public information requirement contained in Paragraph (c) of Rule
144 under the Act should the Holders ever wish to dispose of any of the Shares
without registration under the Securities Act in reliance upon Rule 144 (or any
equivalent successor provision); and (ii) to qualify KRH for the use of
registration statements on Form S-3, or its equivalent successor form, in
connection with secondary distributions of securities of KRH. In addition, KRH
shall take such other measures and file such other information, documents, and
reports as shall hereafter be required by the SEC as a condition to the
availability of Rule 144 under the Securities Act (or any equivalent successor
provision), including, without limitation, using its best efforts to assure that
there shall be available at all times adequate public information with respect
to KRH and the KRH Stock. The obligation

                                      -27-
<PAGE>

to make available adequate public information and otherwise take such measures
necessary to maintain the availability of Rule 144 shall continue in the event
that KRH shall cease to become subject to the filing requirements of Section 13
or Section 15(d) of the Exchange Act.

                                   ARTICLE VI
                      REMEDIES FOR BREACH OF THIS AGREEMENT
                      -------------------------------------

         6.01. INVESTIGATIONS; SURVIVAL OF REPRESENTATIONS AND WARRANTIES The
representations and warranties of the Registered Owner on the one hand, and KRH
on the other hand, contained herein or in any certificates, exhibits or other
documents delivered herewith shall not be deemed waived or otherwise affected by
any investigation made by any party hereto. Each and every such representation
and warranty shall survive the date hereof (even if the party had reason to know
of any misrepresentation or breach of warranty on the date hereof) and shall
continue in full force and effect for a period of one year thereafter (subject
to any statutes of limitations).

         6.02. INDEMNIFICATION.

             (a) INDEMNIFICATION BY THE REGISTERED OWNER. The Registered Owner
shall indemnify and hold harmless KRH in respect of any and all, actions,
suits, proceedings, hearings, investigations, charges complaints, demands,
injunctions, judgments, orders, decrees, rulings, claims, losses, damages,
liabilities, dues, penalties, fines costs obligations, taxes, liens and expenses
(including, without limitation, court costs, settlement costs and any legal,
accounting or other expenses for investigating or defending any actions or
threatened actions) reasonably incurred by KRH in connection with each and all
of the following:

                  (i) any breach of any representation or warranty made by the
Registered Owner in this Agreement; or (ii) any misrepresentation contained in
any statement or certificate furnished by the Registered Owner pursuant to this
Agreement.

             (b) INDEMNIFICATION BY KRH. KRH shall indemnify and hold harmless
the Registered Owner in respect of any and all actions, suits, proceedings,
hearings, investigations,

                                      -28-
<PAGE>

charges complaints, demands, injunctions, judgments, orders, decrees, rulings,
claims, losses, damages, liabilities, dues, penalties, fines costs obligations,
taxes, liens and expenses (including, without limitation, court costs,
settlement costs and any legal, accounting or other expenses for investigating
or defending any actions or threatened actions) reasonably incurred by the
Registered Owner, in connection with each and all of the following:

                  (i) any breach of any representation or warranty made by KRH
in this Agreement; or (ii.) any misrepresentation contained in any statement or
certificate furnished by KRH pursuant to this Agreement.

             (c) CLAIMS FOR INDEMNIFICATION. Whenever any claim shall arise for
indemnification hereunder, the party entitled to indemnification (the
"indemnified party") shall promptly notify the other party (the "indemnifying
party") of the claim and, when known, the facts constituting the basis for such
claim. In the event of any claim by a third party, the notice to the
indemnifying party shall specify, if known, a reasonable estimate of the amount
of the liability arising therefrom. The indemnified party shall not settle or
compromise any claim by the third party without the prior written consent of the
indemnifying party (which shall not be unreasonably withheld) unless suit shall
have been instituted against it and the indemnifying party shall not have taken
control of such suit in, accordance with subsection (d), below.

             (d) DEFENSE BY INDEMNIFYING PARTY. In connection with any
claim by a third party giving rise to indemnity hereunder, the indenmifying
party at its sole cost and expense may, upon written notice to the indemnified
party, assume the defense of such claim if it acknowledges to the indemnified
party in writing its obligations to indemnify the indemnified party with respect
to all elements of such claim. The indemnified party shall be entitled to
participate in (but not control) the defense of any such action, with its
counsel and at its own expense. If the indemnifying party does not assume the
defense of any such claim or litigation resulting therefrom, (a) the indemnified
party may defend against such claim or litigation, in such manner as it may deem
appropriate, including settling such claim or litigation, after giving notice of
the same to the indemnifying party, on such terms as the indemnified party may
deem appropriate, and (b) the indemnifying party shall be entitled to
participate in (but not control) the defense of such action, with its counsel
and at its own expense.

                                      -29-
<PAGE>

             (e) CLAIMS SUBJECT TO THIS ARTICLE. All claims by any party for any
losses, damages, liabilities and expenses reasonably incurred by such party in
connection with any breach of any representation or warranty of any other party
hereto shall be subject to the provision of this Article VI.

                                   ARTICLE VII
                            MISCELLANEOUS PROVISIONS
                            ------------------------

         7.01. EXPENSES; TRANSFER TAXES, ETC Whether or not the transaction
contemplated by this Agreement shall be consummated, Cetoni agrees that all
fees and expenses incurred by it in connection with this Agreement shall be
borne by it and KRH agrees that all fees and expenses incurred by it in
connection with this Agreement shall be borne by it, including, without
limitation as to Cetoni or KRH, all fees of counsel, actuaries and accountants.

         7.02. NOTICES. All notices, requests, demands and other communications
required or permitted hereunder shall be in writing and shall be deemed to have
been duly given if delivered by hand or mailed, certified or registered mail
with postage prepaid:

                       (a) If to the Registered Owner, to:

                              Mrs. Alice Schlattl
                              Tittlinger Strasse 22
                              94034 Passau-Patriching, Germany

                       (with a copy to)

                              Dr. Thomas Schinogl
                              Mainzer Landstrasse 27-31
                              Frankfurt, D60329 Germany
or to such other person or address as the Registered Owner shall furnish to KRH
in writing.

                       (b) If to KRH, to:

                              Kurchatov Research Holdings, Ltd.
                              Weisbadnerstrasse 17, D-12309
                              Berlin, Germany

                       (with a copy to:)

                                      -30-
<PAGE>

                              William P. Ruffa, Esq.
                              Ruffa & Ruffa, P.C.
                              150 East 58th Street
                              35th Floor
                              New York, New York 10155

or to such other person or address as KRH shall furnish to the Registered Owner
in writing.

         7.03. ASSIGNMENT. This Agreement and all of the provisions hereof shall
be binding upon and inure to the benefit of the parties hereto and their
respective successors and permitted assigns, but neither this Agreement nor any
of the rights, interests or obligations hereunder shall be assigned by any of
the parties hereto without the prior written consent of the other parties.

         7.04. PUBLICITY. Neither the Registered Owner nor KRH shall make or
issue or cause to be made or issued, any announcement or written statement
concerning this Agreement or the transactions contemplated hereby for
dissemination to the general public without the prior consent of the other
party. This provision shall not apply, however, to any announcement or written
statement required to be made by law or the regulations of any federal or state
governmental agency or any stock exchange, except that the party required to
make such announcement shall, whenever practicable, consult with the other party
concerning the timing and content of such announcement before such announcement
is made.

         7.05. GOVERNING LAW: CONSENT TO JURISDICTION. This Agreement and the
legal relations among the parties hereto shall be governed by and construed in
accordance with the laws of the State of New York, without regard to its
conflicts of law doctrine. Each party hereby irrevocably submits to the
non-exclusive jurisdiction of the state and federal courts sitting in the City
of New York, borough of Manhattan, for the adjudication of any dispute hereunder
or in connection herewith or with any transaction contemplated hereby or
discussed herein, and hereby irrevocably waives, and agrees not to assert in any
suit, action or proceeding, any claim that it is not personally subject to the
jurisdiction of any such court, that such suit, action or proceeding is
improper. Each party hereby irrevocably waives personal service of process and
consents to process being served in any such suit, action or proceeding by
mailing a copy thereof to such party at the address in effect for notices to it
under this Agreement and agrees that such service shall constitute good and
sufficient service of process and notice thereof Nothing contained herein shall
be deemed to limit in any way any right to serve process in any manner permitted
by law.

                                      -31-
<PAGE>

         7.06. COUNTERPARTS: FACSIMILE EXECUTION. This Agreement may be executed
in two or more counterparts, all of which when taken together shall be
considered one and the same agreement and shall become effective when
counterparts have been signed by each party and delivered to the other party, it
being understood that both parties need not sign the same counterpart. In the
event that any signature is delivered by facsimile transmission, such signature
shall create a valid and binding obligation of the party executing (or on whose
behalf such signature is executed) the same with the same force and effect as if
such facsimile signature page were an original thereof.

         7.07. HEADINGS. The headings of the Sections and Articles of this
Agreement are inserted for convenience only and shall not constitute a part
hereof or affect in any way the meaning or interpretation of this Agreement.

         7.08. ENTIRE AGREEMENT. This Agreement, including the Exhibits hereto,
the Disclosure Schedule and the other documents and certificates delivered
pursuant to the terms hereof, set forth the entire agreement and understanding
of the parties hereto in respect of the subject matter contained herein, and
supersede all prior agreements, promises, covenants, arrangements,
communications, representations or warranties, whether oral or written, by any
officer, employee or representative of any party hereto.

         7.09. THIRD PARTIES. Except as specifically set forth or referred to
herein, nothing herein expressed or implied is intended or shall, be construed
to confer upon or give to any person or corporation other than the parties
hereto and their successors or assigns, any rights or remedies under or by
reason of this Agreement.

         7.10. SEVERABILITY. The invalidity or unenforceability of any provision
of this Agreement shall not affect the validity or enforceability of any other
provision. If any provision of this Agreement is so broad as to be
unenforceable, such provision shall be construed to be only so broad as is
enforceable.

         7.11. INCORPORATION OF SCHEDULES AND EXHIBITS. The Schedules and
Exhibits identified in this Agreement are incorporated herein by reference and
made a part hereof

                                      -32-
<PAGE>

         7.12. CONSTRUCTION. The parties hereto have participated jointly in the
negotiation and drafting of this Agreement. In the event an ambiguity or
question of intent or interpretation arises, this Agreement shall be construed
as if drafted jointly by the parties and no presumption shall arise favoring or
disfavoring any party by virtue of the authorship of any of the provisions of
this Agreement. Any reference to any federal, state or local statute or law
shall be deemed to also to refer to all rules and regulations promulgated
thereunder, unless the context requires otherwise. The word "including" shall
mean including without limitation. The parties intend that each representation,
warranty or covenant contained herein shall have independent significance. If
any party has breached any representation, warranty or covenant herein in any
respect, the fact that there exists another representation, warranty or covenant
relating to the same subject matter (regardless of the relative levels of
specificity) which the party has not breached shall not detract from or mitigate
the fact that the party is in breach of the first representation, warranty or
covenant.

                   REMAINDER OF PAGE INTENT1ONALLY LEFT BLANK
                             SIGNATURE PAGE FOLLOWS

<PAGE>

         IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed and their respective corporate seals to be affixed hereto, all on
the day and year first above written.

                                            KURCHATOV RESEARCH HOLDINGS, LTD.

                                            By: /s/ Hans Joachim Skrobanek
                                               ---------------------------------
                                               Hans Joachim Skrobanek, President

                                            ALICE SCHLATTL

                                            /s/ Alice Schlattl
                                            -----------------------
[Seal]

Attest:

__________________________
Title:STOCK PURCHASE AND CROSS-RELEASE AGREEMENT

         THIS AGREEMENT, made as of this 30 day of November, 1999, by and
between EUROTECH, LTD., a District of Columbia corporation, the principal place
of business of which is 1216 16th Street, NW, Suite 200, Washington, D.C. 20036
("Eurotech") and KURCHATOV RESEARCH HOLDINGS, LTD., a Delaware corporation, the
principal place of business of which is Wiesbadener Street, 17A, DD-l2309
Berlin, Germany ("Kurchatov")

                              W I T N E S S E T H:

         WHEREAS, Eurotech is the exclusive world-wide licensee except for the
territory comprised of Russian Federation of the family of technologies
evidenced by United States patent 5,886,060, issued March 23, 1999; and Russian
patent number 2111982 received May 27, 1998; and applications numbers:
PCT/RU98/00009, application date January 1998; PCT/RU98/000073, application date
March 12, 1998, PTC/RU98/000429, application date December 23, 1998 and
subsequent developments, collectively known as EKOR (such technologies
hereinafter collectively, EKOR); and

         WHEREAS, pursuant to a letter agreement, dated January 28, 1997,
between Eurotech and Kurchatov, Kurchatov is entitled to receive from Eurotech
one-half (1/2) of the net operating profits derived by Eurotech from the
operation, licensing, sale or other exploitation by Eurotech of EKOR and whereas
Kurchatov paid for certain EKOR equipment (hereinafter, the EKOR Operating
Interests); and

         WHEREAS, Eurotech has provided Kurchatov a complete description of the
commercial applications of EKOR as known to Eurotech; and

         WHEREAS, Eurotech is the owner, of record and beneficially, of six
million seven hundred ninety-five thousand (6,795,000) shares of the common
stock of Kurchatov (the "Kurchatov Shares); and

         WHEREAS, Kurchatov acquired from Eurotech that certain technology of
the resealable can evidenced by German patent numbers (i) Behaelter sowie
Verschluiss fuer einen solchen Behaelter" sasnle Registreation 296 16 133.0 and
(ii) patent registration 196 46 437.4 and Wiederverschliessbare
Weicvhverpackung, die unter anderem fuer geeignet is (reclosing soft-material
packaging suited, e.g., for Tetrapak) application-number for patent registration
197 21 408.2 dated 5-21-1997m plus amendment number 197 29 194.5 dated 7-8-1997
(such technology hereinafter, the "Resealable Can") pursuant to which
acquisition transaction Kurchatov owes Eurotech a six percent (6%) royalty
interest with respect to Kurchatov's commercial exploitation of the Resealable
Can; and

         WHEREAS, Kurchatov is indebted in the principal amount of Seven Hundred
Fifty Thousand Dollars ($750,000.00) in addition to accrued interest, penalties
and conveyances of common stock, to Spinneret Financial Systems, Inc.
(Spinneret"); and

         WHEREAS, it is in the best interests of both Eurotech and Kurchatov to
simplify their business relationship in the manner hereinafter set forth;

         NOW, THEREFORE, in consideration of the premises and the mutual
conveyances and promises set forth hereinafter and other good and valuable
consideration, the receipt and sufficiency of which is hereby acknowledged, the
parties hereto do hereby agree as follows:

         1. Purchase of Stock.

                  Subject to the terms and conditions of this Agreement,
Kurchatov hereby agrees to purchase and purchases from Eurotech, and Eurotech
hereby agrees to sell and sells to Kurchatov, two million (2,000,000) authorized
and unissued shares of the common stock, par value $0.00025 per share ("Common
Stock") of Eurotech (the "Eurotech shares") Eurotech is delivering to Kurchatov
herewith a certificate or certificates representing the Eurotech Shares sold
pursuant to this Section 1 to Kurchatov.

         2. Consideration.

                  In full consideration for the Eurotech Shares and subject to
the terms and conditions of this Agreement, Eurotech is paying concurrently
herewith the amount of five million Dollars ($5,000,000.00), which amount is
deemed by the parties hereto to be comprised in and constituted by part, but not
all, of the fair value to Eurotech of the release by Kurchatov of the EKOR
Operating Interest as hereinafter set forth.

         3. Representations, Warranties and Agreements of Eurotech.

                  Eurotech hereby represents and warrants to Kurchatov as
follows:

                  3.1 Status of Eurotech. Eurotech is a corporation duly
organized, validly existing and in good standing under the laws of the District
of Columbia, and has all requisite corporate power and authority to own its
properties and to conduct its business as presently conducted, and is duly
qualified to do business as either a foreign or domestic corporation in each
state in which it is deemed to transact business under applicable law.

                  3.2 The Eurotech Shares. The authorized capital stock of
Eurotech consists of fifty million (50,000,000) shares of Common stock, of which
the Eurotech Shares constitute four per cent, (4%) of all such shares which are
issued, outstanding and obligated after giving effect to such issuance. All of
the Eurotech Shares are validly issued, fully paid and non-assessable. There are
outstanding subscriptions, options, warrants, convertible securities or other
agreements or commitments obligating Eurotech to issue or to transfer from its
treasury additional shares of its capital stock to bring the total of issued
shares, fifty million (50,000,000). No capital Event (as defined in Section 6
hereof) shall occur prior to the expiration date (as defined in Section 5.1
hereof) unless authorized by a duly ca4ed and held meeting of the shareholders
of Eurotech.

<PAGE>

                  3.3 Good Title Transferred. Upon delivery to Kurchatov of the
stock certificate or certificates referred to in Section 1 above, Kurchatov will
receive good and marketable title to four per cent, (4%) of all of the issued,
obligated and outstanding common stock of Eurotech in addition to such common
stock as Kurchatov has already acquired prior to the date hereof, all of which
such securities acquired by Kurchatov pursuant to this Agreement shall be
received by Kurchatov as validly issued, fully paid and non-assessable, free and
clear of all liens, encumbrances, security interests, equities, options, claims,
charges, limitations on voting rights or rights to receive dividends, or other
restrictions of any kind (other than any generally imposed by federal or state
securities laws).

                  3.4 Subsidiaries. Eurotech does not own, directly or
indirectly, any interest or investment, whether debt or equity, in any
corporation, partnership, business trust or other entity, except securities
listed on a national securities exchange or traded in the over-the-counter
market not exceeding in market value for any issue five per cent. (5%) of the
total outstanding market value of such issue listed or traded.

                  3.5 Liabilities. Eurotech has no debt, liability or obligation
or any nature, whether accrued, absolute, contingent or otherwise, and whether
due or to become due, that is not reflected or reserved against in Eurotech
financial statements previously furnished to Kurchatov or set forth in
Eurotech's most recent periodic tiling on Form 8-K, l0-Q or 10-K with the
Securities and Exchange Commission (the "Commission") pursuant to the Securities
Exchange Act of 1934, as amended, except for those previously disclosed to
Kurchatov (i) that may have been incurred since the date of the most recent
balance sheet included therein or (ii) that are not required by generally
accepted accounting principles to be included in a balance sheet. All debts,
liabilities and obligations incurred after such date were incurred in the
ordinary course of business, and are usual and normal in amount both
individually and in the aggregate.

                  3.6 Taxes. Within the times and in the manner prescribed by
law, Eurotech has filed all federal, state and local tax returns required by law
and has paid all taxes, assessments and penalties due and payable. The
provisions for taxes reflected in Eurotech's most recent balance sheet furnished
to Kurchatov are adequate for any and all federal, state, county and local taxes
for the period ending on such date and for all prior periods, whether or not
disputed. There are no present disputes as to taxes of any nature payable by
Eurotech.

                  3.7 Authority to Consummate Transactions. The execution and
delivery of this Agreement and the consummation of the transactions contemplated
herein are within the corporate powers of Eurotech and have been duly authorized
by all necessary corporate proceedings. No approval or material consent of any
person or entity (other than o Kurchatov) must be obtained by Eurotech prior to
consummating the within transactions, or such approval or material consent has o
been or will be obtained.

<PAGE>

                  3.8 Compliance with Other Instruments, etc. Neither the
execution of this Agreement nor the consummation of the transactions
contemplated herein will (i) require Eurotech to obtain the consent of any
governmental agency not already obtained; (ii) result in any violation or breach
of any term or provision of the articles of incorporation or by-laws of
Eurotech; (iii) constitute a material default under any indenture, mortgage,
deed of trust or other contract or agreement to which Eurotech is a party or to
which it or any of its properties may be subject; or (iv) cause the creation or
imposition of any lien, charge or encumbrance on any of the assets or the
business of Eurotech.

                  3.9 Binding Obligation. This Agreement, when executed and
delivered, will constitute the valid and binding obligation of Eurotech,
assuming due authorization, execution and delivery by Kurchatov.

                  3.10 Brokerage and Finder's Fee. Neither Eurotech nor any
officer, director or agent of Eurotech has incurred any liability to any broker,
finder or agent for any brokerage fees, finder's fees or commissions with
respect to the transactions contemplated by this Agreement.

                  3.11 Business Assets. Except as previously disclosed to
Kurchatov, Eurotech has good and marketable title to all of its assets,
including, but not limited to, EKOR.

                  3.12 Compliance with Law. Except as previously disclosed to
Kurchatov, the business of Eurotech is not in violation of any applicable
federal, state or local statutes, laws or regulations (including, without
limitation, building, health, nuisance, zoning and other laws, ordinances and
regulations)

                  3.13 Litigation and Other Proceedings. Except as previously
disclosed to Kurchatov, there is no known suit, action, arbitration or legal,
administrative or other proceeding or governmental investigation pending,
threatened or likely to be asserted against or affecting the business of
Eurotech. Eurotech is not in default with respect to any order, writ, injunction
or decree of any federal, state, local or foreign court, department, agency or
instrumentality affecting such business. Eurotech will assume responsibility and
liability for all suits, actions, arbitrations or other proceedings so disclosed
to Kurchatov to the extent it would be liable under Section 9.1.

                  3.14 EKOR Technologies. The information provided by Eurotech
to Kurchatov concerning the commercial applications of EKOR is complete and
accurate in all material respects as of the date of this Agreement.

                  3.15 Adverse Changes. Except as previously disclosed to
Kurchatov, there has not been any material adverse change affecting Eurotech's
business, financial condition or prospects since the date of its financial
statements referred to in Section 3.5, including, but not limited to, any of the
following:

                           (a) any transaction by Eurotech not in the ordinary
course of business as conducted on such date;

                           (b) any capital expenditure by Eurotech exceeding
$25,000.00;
<PAGE>

                           (c) the destruction, damage to or loss of any assets
of Eurotech (whether or not covered by insurance) that materially and adversely
affects the financial condition, business or prospects of Eurotech;

                           (d) labor trouble or other event or condition of any
character materially and adversely affecting the financial condition, business,
assets or prospects of Eurotech;

                           (e) any change in accounting methods or practices
(including, without limitation, any change in depreciation or amortization
policies or rates) by Eurotech;

                           (f) any revaluation by Eurotech of any of its assets;

                           (g) any declaration, setting aside or payment of any
dividend or other distribution in respect of the capital stock of Eurotech, or
any other direct or indirect redemption, purchase or other acquisition by
Eurotech of any of its shares of capital stock;

                           (h) any increase in the salary or the compensation
payable or to become payable by Eurotech to any of its officers, directors or
employees; or the declaration of, payment of or commitment to pay by Eurotech of
any bonus or other additional salary or compensation to any such person;

                           (i) the sale or transfer of any assets of Eurotech,
except sales of inventories in the ordinary course of business;

                           (j) the amendment or termination of any contract,
agreement or license to which Eurotech is or was a party, except in the ordinary
course of business;

                           (k) any loan by Eurotech to any person or entity
(other than normal extensions of trade credit to customers), or guarantee by
Eurotech of any loan;

                           (1) any mortgage, pledge or other encumbrance of any
asset of Eurotech;

                           (m) the waiver or release of any right or claim of
Eurotech, except in the ordinary course of business;

                           (n) any other event or condition of any character
that has or might reasonably have a material or adverse effect on the financial
condition, business, assets or prospects of Eurotech;

                           (o) the issuance or sale by Eurotech (except as
contemplated by this Agreement and the agreement for sale of shares to Horizon
Capital of America) of any shares of its capital stock of any class, or of any
other of its securities; or

                           (p) the agreement by Eurotech to do any of the things
described in the preceding clauses (a) through (o)

<PAGE>

         4. Representations, Warranties And Agreements of Kurchatov.

                  Kurchatov hereby represents and warrants to Eurotech as
follows:

                  4.1 Status of Kurchatov. Kurchatov is a corporation duly
organized, validly existing and in good standing under the laws of the State of
Delaware and has all requisite corporate power and authority to own its
properties and to conduct its business as presently conducted.

                  4.2 Kurchatov's Authority to Consummate Transactions. The
execution and delivery of this Agreement and the consummation of the
transactions contemplated herein are within the corporate powers of Kurchatov
and have been duly authorized by all necessary corporate proceedings. No
approval or material consent of any person or entity (other than Eurotech) must
be obtained by Kurchatov prior to consummating the within transactions, or such
approval or material consent has been or will be obtained.

                  4.3 Compliance with Other Instruments, etc. Neither the
execution of this Agreement nor the consummation of the transactions
contemplated herein and therein will (i) require Kurchatov to obtain the consent
of any governmental agency not already obtained; (ii) result in any violation or
breach of any term or provision of Kurchatov's articles of incorporation or
by-laws; or (iii) will constitute a material default under any indenture,
mortgage, deed of trust or other contract or agreement to which Kurchatov is a
party or to which it or any of its properties may be subject.

                  4.4 Binding Obligations. This Agreement when executed and
delivered will constitute the valid and binding obligation of Kurchatov,
assuming due authorization, execution and delivery by Eurotech.

                  4.5 Brokerage and Finder's Fees. Neither Kurchatov nor any
officer, director or agent of Kurchatov has incurred any liability to any
broker, finder or agent for any brokerage fees, finder's fees or commissions
with respect to the transactions contemplated by this Agreement.

                  4.6 Restricted Securities. Kurchatov understands and hereby
acknowledges that the Eurotech Shares will be issued pursuant to an exemption
from the registration requirements of the Securities Act of 1933, as amended
(the "Act") and the Rules and Regulations of the Commission promulgated
thereunder; that the Eurotech Shares will be "Restricted Securities" as defined
in Rule 144(a)(3) promulgated under the Act; and that the stock certificate or
certificates to be issued to Kurchatov in respect of such securities may bear a
legend of a form satisfactory to counsel for Eurotech reflecting the status of
such Eurotech Shares as "Restricted Securities" under Rule 144(a)(3) promulgated
under the Act. Kurchatov further acknowledges that the transfer agent or
registrar for Eurotech may be instructed to restrict the transfer of such
securities in accordance with the legend mentioned herein and any other
applicable restrictions, and Kurchatov hereby agrees not to sell, transfer,
hypothecate, pledge, assign or otherwise dispose of any of the Eurotech Shares
except pursuant to a registration statement filed under the Act, a favorable
no-action or interpretative letter received from the Commission or an opinion of
counsel satisfactory to Eurotech that such sale, transfer, hypothecation,
pledge, assignment or other disposition is exempt from the registration
requirements of the Act.
<PAGE>

         5. Registration Rights.

                  5.1 Piggy-Back Registration Rights. If at any time on or
before the fifth (5th) anniversary of the execution and delivery of this
Agreement (the "Expiration Date") Eurotech shall file a registration statement
on Form S-1 or any form substituted therefore, with respect to any shares of its
Common Stock under the Act, or files a post-effective amendment to any
registration statement on Form S-1 or any form substituted therefore, which
post-effective amendment contains a prospectus complying with Section 10(a) of
the Act, Eurotech will give to Kurchatov timely notice of its intention to file
such registration statement or post-effective amendment, as the case may be, and
promptly after receipt of a written request made by Kurchatov within fifteen
(15) days after the giving of such notice, Eurotech will register under the Act
all Eurotech Shares held by Kurchatov and covered by any such request, and will
maintain the prospectus included in any registration statement which may be so
filed current for a period of ninety (90) days subsequent to the effective date
of such registration statement; provided, however, that Eurotech's obligations
to register shares of Common Stock and to maintain prospectuses hereunder shall
be subject to the approval of any underwriters engaged by Eurotech in connection
with any such registration, which approval by any such underwriters may be
unreasonably withheld, in such underwriters' absolute discretion. The
obligations of Eurotech under this Section 5.1 shall be fully satisfied upon the
effective date of the first such registration statement or post-effective
amendment to which this Section 5.1 is applicable, and notwithstanding a delay
in Kurchatov's ability to sell such shares by reason of applicable securities
regulations; provided, however, that in the event of any such delay, Kurchatov
shall be entitled to offer such shares for sale within a reasonable time not
exceeding nine (9) months after the said effective date; and provided, further,
in the event any underwriters engaged by Eurotech in connection with such
registration statement or post-effective amendment withhold approval pursuant to
the preceding sentence of this Section 5.1, the obligations of Eurotech under
this Section 5.1 shall continue in full force and effect.

                  5.2 Demand Registration Rights. Upon receipt by Eurotech, at
any time during the period from the date of the execution and delivery of this
Agreement by each of the parties to and including the Expiration Date, of a
written request by Kurchatov to register the Eurotech Shares under the Act,
Eurotech will, as promptly as practicable, at Kurchatov's sole cost and expense
(including, but not limited to, printing, legal and accounting fees), (i)
prepare and file under the Act a registration statement relating to such
Eurotech Shares (the term "registration statement") as used in this Section 5.2
being deemed to include any form which may be used to register a distribution of
securities to the public for cash or a post-effective amendment to a
registration statement); (ii) prepare and file with the appropriate state
securities regulatory ("Blue Sky") authorities the necessary documents to
register or qualify such Eurotech Shares; provided, however, that Eurotech shall

<PAGE>

not be required to qualify as a foreign corporation in any jurisdiction or to
give a general consent to service of process in any jurisdiction except in
connection with matters arising from the sale of Common Stock in such
jurisdiction; and (iii) use its best efforts to cause such registration
statement to become effective and to keep such registration statement and Blue
Sky filings current and effective until such time as an amendment is required to
be filed pursuant to the provisions of Section 10(a)(3) of the Act. Eurotech
shall not be obligated to prepare and file more than two (2) registration
statements under this Section 5.2 during the effectiveness of this Agreement and
not more than one (1) in any year, and, in any year in which a request for
registration is made pursuant to this Section 5.2, Eurotech may postpone the
preparation and filing of such registration statement, if necessary, until its
year-end financial statements required for use in such registration statements
become available.

                  5.3 Amendments. If at any time within nine (9) months after a
post-effective amendment or a new registration statement covering the Eurotech
Shares as provided in Section 5.1 or 5.2 hereof shall have become effective, to
the knowledge of Eurotech any event occurs as a result of which a prospectus
included therein relating to the Eurotech Shares as then amended or supplemented
would include any untrue statement of a material fact, or would not state a
material fact necessary to make the statements therein, in the light of the
circumstances then existing, not misleading, Eurotech will promptly notify
Kurchatov and, if such event occurs within ninety (90) days (excluding any
period during which a stop order suspending the effectiveness of the
registration statement or post-effective amendment to a registration statement
of which such prospectus forms a part), Eurotech will at its own cost and
expense amend or supplement such prospectus in order to correct such statement
or omission in order that the prospectus as so amended or supplemented will
comply with the requirements of Section 10(a) of the Act. In case Kurchatov is
required to deliver a prospectus after such 90-day period, Eurotech will, at
Kurchatov's expense, prepare promptly such prospectus or prospectuses and
thereafter amend or supplement the same as may be necessary to permit compliance
with Section 10(a) of the Act.

                  5.4 Compliance. In connection with any registration statement
or post-effective amendment pursuant to Section 5.1 or 5.2:

                           (a) Eurotech will comply with all applicable rules
and regulations of the Commission or any similar Federal commission and will
make available to its security holders, as soon as practicable, an earnings
statement (which need not be audited) covering a period of at least twelve (12)
months, but no more than eighteen (18) months, beginning with the first month
after the effective date of the registration statement or post-effective
amendment, as the case may be, which earnings statement will satisfy the
provisions of Section 11(a) of the Securities Act;

                           (b) Each holder of the shares of Common Stock covered
by such post-effective amendment or registration statement, as the case may be,
shall furnish in writing to Eurotech such information regarding such holder and
its proposed plan of distribution of such shares as Eurotech shall request in
order to have such post-effective amendment or registration statement declared
effective;

<PAGE>

                           (c) Eurotech agrees to furnish to Kurchatov a
prospectus (in such reasonable quantities as Kurchatov shall request) containing
certified financial statements and other information meeting the requirements of
the Act and the rules and regulations thereunder and relating to the Eurotech
Shares. The furnishing of such prospectus shall be at the expense of the party
or parties bearing the cost and expense of the registration statement or
post-effective amendment, as the case may be, of which such prospectus is a part
as provided for in Section 5.1 or 5.2 above, as the case may be; and

                           (d) Eurotech will use its best efforts to qualify the
shares of Common Stock covered by any registration statement or post-effective
amendment for public offering or sale on the effectiveness thereof in such
jurisdictions as the holders offering the same shall reasonably request;
provided, however, that Eurotech shall not be required to qualify as a foreign
corporation in any jurisdiction or to give a general consent to service of
process in any jurisdiction except in connection with matters arising from the
sale of shares of Common Stock in such jurisdiction. The filing fees and
reasonable fees and expenses of counsel in connection with such qualification
shall be paid for by the party or parties bearing the cost and expense of the
registration statement or post-effective amendment, as the case may be, covering
the shares being qualified as provided for in Section 5.1 or 5.2 above, as the
case may be.

                  5.5 Indemnification. In the event of any such registration of
any Eurotech Shares, Eurotech will indemnify and hold harmless each holder of
shares of Common Stock being offered and each person, if any, who may be deemed
to control such holder within the meaning of Section 15 of the Act against any
losses, claims, damages or liabilities, joint or several, to which any of them
may become subject under the Act, or otherwise, in so far as such losses,
claims, damages or liabilities (or actions in respect thereof) arise out of or
are based upon any untrue statement or alleged untrue statement of any material
fact contained, on the effective date thereof, in any registration statement or
post-effective amendment under which such shares of Common Stock were registered
under the Act, any preliminary prospectus or final prospectus contained
therein, or any amendment or supplement thereto, or arise out of or are based
upon the omission or alleged omission to state therein a material fact required
to be stated therein or necessary to make the statements therein not misleading,
and will reimburse each of them for any legal or any other expenses reasonably
incurred by them in connection with investigating, defending or settling any
such loss, claim, damage, liability or action; provided, however, that Eurotech
will not be liable in any such case to any of them to the extent that any such
loss, claim, damage, liability or expense arises out of or is based upon any
untrue statement of any material fact contained, on the effective date thereof,
in such registration statement or post-effective amendment, such preliminary
prospectus or such final prospectus or any such amendment or supplement in
<PAGE>

reliance upon and in conformity with information furnished in writing by such
persons to Eurotech expressly for use in the preparation thereof, or arises out
of or is based upon any omission Or alleged omission to state a material fact in
connection with such written information required to be stated in such
registration statement, such post-effective amendment, such preliminary
prospectus or such final prospectus or any such amendment or supplement, or
necessary to make such information when used in such registration statement or
post-effective amendment, such preliminary prospectus or such final prospectus
or any such amendment or supplement, in the light of the circumstances under
which it is used, not misleading. For purposes of this Section 5.5, "information
furnished in writing by such persons" shall include such post-effective
amendment, such preliminary prospectus or such final prospectus or any such
amendment or supplement which has been expressly identified and approved in
writing in a letter signed by the person or persons involved. Each such person
shall promptly give notice to Eurotech after such person has actual knowledge of
any such claim as to which indemnity may be sought hereunder, or of the
commencement of any legal proceedings against such person as to such claim,
whichever shall first occur, and shall permit Eurotech to assume the defense of
any such claim or any litigation resulting from such claim; provided, however,
that (i) counsel satisfactory to Eurotech and each such person involved shall
act as counsel for Eurotech and shall conduct the defense of such claim or
litigation, and (ii) each such person may participate in such defense at the
expense of such person; and provided, further, that the omission by any such
person to give notice to Eurotech as provided in this sentence or the failure to
permit Eurotech to conduct such defense shall relieve Eurotech of its
obligations to conduct such defense under this Section 5.5, but shall not
relieve Eurotech of its obligations otherwise than under this Section 5.5.
Eurotech shall notify each such person involved within fifteen (15) days after
Eurotech shall have received such notice. If Eurotech shall elect to defend such
claim or litigation resulting therefrom, the obligation of Eurotech under this
Section 5.5 shall be limited to taking all steps necessary in holding the person
involved harmless from and against any losses, damages or liabilities caused by
or arising out of any settlement approved by Eurotech or from any judgment on
such claim or litigation arising therefrom; provided, however, that in defending
such claim or litigation resulting therefrom, Eurotech shall not consent to
entry of any judgment except with the consent of each such person involved or
enter into any settlement (except with the consent of each such person involved)
which does not include as an unconditional term thereof the giving by the
claimant or plaintiff to such person of a release from all liability in respect
of such claim or litigation.

         6. Changes in Capital Structure.

                  In the event that prior to the Expiration Date there is any
change in the Common Stock by reason of a stock dividend issued with respect to
the Common Stock, or a recapitalization, reclassification, stock split or
combination of shares with respect to the Common Stock, or if the outstanding
Common Stock should, by reason of a merger, consolidation, acquisition of stock
or property, reorganization or liquidation, be exchanged for other shares of
capital stock of Eurotech or of another corporation which is a party to such
transaction, (each of foregoing hereinafter "Capital Events") the Eurotech
Shares to be issued and delivered to Kurchatov under this Agreement shall not be
affected differently than any other Common Stock shares.

         7. Cross-Releases.

<PAGE>

                  7.1 Release of the EKOR Operating Interest. In consideration
of the issuance to Kurchatov of the Eurotech Shares to the extent of the
consideration set forth in Section 2 hereof, as well as further set forth
herein, Kurchatov hereby releases, except to the extent hereinafter specified,
all interest, ownership or title it has in the EKOR Operating Interest.

                  7.2 Surrender of Kurchatov Shares. In further consideration of
Kurchatov's release of the EKOR Operating Interest, Eurotech hereby surrenders
to Kurchatov all of its certificates evidencing the Kurchatov Shares, which
certificates are duly endorsed by Eurotech for transfer or accompanied by stock
powers duly endorsed in blank by Eurotech, with signatures guaranteed by a
member of the New York Stock Exchange or by a bank or trust company.
Consideration in the amount of Four million eight-hundred-forty-one thousand,
four-hundred-thirty-eight dollars ($4,841,438) is deemed by the parties to be
allocated to the Kurchatov Shares out of and comprised in the release by
Kurchatov of the EKOR Operating Interest.

                  7.3 Release of Resealable Can Obligations. In further
consideration of Kurchatov's release of the EKOR Operating Interest, Eurotech
hereby surrenders its six per cent. (6%) royalty interest therein. Consideration
in the amount of one million dollars ($1,000,ooo) is deemed by the parties to be
allocated to Eurotech's release of Kurchatov's obligations with respect to the
Resealable Can out of and comprised in the release by Kurchatov of the EKOR
Operating Interest.

                  7.4 Assumption of the Spinneret Debt. In further consideration
of Kurchatov's release of the EKOR Operating Interest, Eurotech hereby assumes
and agrees to pay and perform on a timely basis all of Kurchatov's obligations
to Spinneret. Consideration in the amount of two million five hundred thousand
dollars ($2,500,000.00) is deemed by the parties to be allocated to Eurotech's
assumption of the Spinneret debt out of and comprised in the release by
Kurchatov of the EKOR Operating Interest, with approving concurrence of
Spinneret.

         8. Overriding Royalty Interest.

                  8.1 Retention of Overriding Royalty Interest by Kurchatov. So
long as the patents, or any of them, listed in the first recital to this
Agreement shall remain valid, enforceable and unexpired, Eurotech shall pay to
Kurchatov an overriding royalty interest (the "ORR") of two per cent. (2%) of
gross sales (hereinafter, "Gross Sales"), defined as the gross selling price as
received by Eurotech of all products or services arising out of the commercial
exploitation of EKOR established in bona fide, arm's length transactions between
Eurotech and an individual or entity (a "Purchaser") not related to Eurotech by
reason of material stock ownership or direct or indirect participation in
Eurotech's management, f.o.b. factory, after deducting any quantity, quality and
customary trade discounts (other than cash) or rebates, whether indicated on the
invoice or compiled for a given period, such as a calendar quarter, but not
deducting packing, freight, insurance, customs duties and federal, state and
local taxes and fees (such as sales taxes) directly applied to such price,
unless separately itemized on the invoice and charged directly to the Purchaser;
provided, however, that freight and insurance may be deducted for c.i.f. sales
and f.o.b. customer sales although not separately stated.

<PAGE>

                  8.2 Payment. Payment of the ORR shall be converted into U.S.
dollars at the rate of exchange applicable to the currency in which the Gross
sales are made as established by the trustee New York City bank as Kurchatov may
from time to time designate (the "Trustee") All payments of the ORR shall be
made in U.S. dollars to be deposited to Kurchatov's credit at the Trustee. Such
payments shall be paid to Kurchatov within thirty (30) days after the end of
each calendar quarter, accompanied by a written royalty report, certified as
accurate by Eurotech's Chief Financial Officer, setting forth in as much detail
as possible the basis of calculation of the amount of ORR paid with respect to
the calendar quarter just ended.

                  8.3 Monetary Controls. In the event that the United States
shall impose any law, rule or regulation prohibiting or limiting Eurotech's
right to comply with Sections 8.1 and 8.2, Eurotech shall be deemed to fulfill
its obligations under those sections if it pays the royalty due into the
Trustee, or, if that shall not then be permissible, in the name of a nominee for
and on behalf of Kurchatov.

                  8.4 Compliance With U.S. Regulation. Eurotech shall be
responsible for compliance with applicable United States regulations concerning
payments and for the preparation, filing and securing, where required, of
approval of all applications, reports and other documents and services which may
be required by the United States of America in connection with this Agreement
and remittances to be made under this Agreement.

                  8.5 Records. Eurotech shall keep true and accurate books of
account and shall keep and maintain all records, documents and other instruments
relating to Gross Sales in such detail as shall enable Kurchatov to ascertain
the ORR due under this Agreement and compliance with payment. Kurchatov shall
have the right to designate a firm of certified public accountants, reasonably
acceptable to Eurotech, to inspect Eurotech's books of accounts, records,
documents and instruments and to make copies thereof, at any time during
Eurotech's regular business hours, but not more than one (1) time annually,
during the term of this Agreement and for a period of one hundred eighty (180)
days immediately after its termination, to ascertain the accuracy of such
report. The expense of such audit shall be Kurchatov's unless the audit shall
demonstrate a discrepancy (in Eurotech's favor) greater than five per cent. (5%)
between the amount of ORR reported and paid by Eurotech and that which was
actually due, in which event the audit expenses shall be borne by Eurotech.

         9. Indemnification.

                  9.1 Indemnity by Eurotech. Eurotech agrees to defend,
indemnify and hold harmless Kurchatov against and in respect of any and all
claims, demands, losses, costs, expenses, obligations, liabilities, damages,
recoveries and deficiencies (including reasonable attorney's fees), arising,
resulting from or relating to any misrepresentation by Eurotech made or
contained in this Agreement or Eurotech's breach of any warranty, covenant or
agreement made or contained in this Agreement.

<PAGE>

                  9.2 Indemnity by Kurchatov. Kurchatov agrees to defend,
indemnify and hold harmless Eurotech against and in respect of any and all
claims, demands, losses, costs, expenses, obligations, liabilities, damages,
recoveries and deficiencies (including reasonable attorney's fees), arising,
resulting from or relating to any misrepresentation by Kurchatov made or
contained in this Agreement or Kurchatov's breach of any warranty, covenant or
agreement made or contained in this Agreement.

                  9.3 Survival of Representations and Warranties. The
representations and warranties made in this Agreement shall survive the date of
this Agreement for a period of five (5) years thereafter.

                  9.4 Defense of Claims. Kurchatov, on the one hand, and
Eurotech, on the other hand, will give each other prompt notice of any claims
for which the other may be liable under this Section 9, and each will permit the
other at its sole expense the opportunity to assist in the defense of any such
claims.

                  9.5 Construction. It is understood and agreed that in the
event of a conflict between the terms and provisions of this Section 9 and those
of Section 5.5 should such latter provision be applicable, Section 5.5 shall
control. It is further understood and agreed that nothing in this Section 9
shall be construed as a limitation or waiver of any right of indemnification,
subrogation or similar right accruing to any party independent of this Agreement
under any applicable statute, rule, code or common law principle.

         10. Miscellaneous.

                  10.1 Governing Law. This Agreement and the other agreements
attached hereto shall be construed in accordance with, and governed by, the laws
of the State of New York.

                  10.2 Notices. All communications under this Agreement shall be
in writing, shall be mailed by first class mail, postage prepaid to the
addresses specified in the preamble to this Agreement, or to such other address
as any party hereto may have furnished in writing to the other parties, and
shall be deemed to be given four (4) days after being so mailed.

                  10.3 Amendment and Waiver. This Agreement may be amended, and
observance of any term of this Agreement may be waived, with (and only with) the
written consent of the parties hereto. No waiver of any of the provisions of
this Agreement shall be deemed to be or shall constitute a waiver of any other
provision, whether or not similar, nor shall any waiver constitute a continuing
waiver.

                  10.4 Duplicate Originals; Counterparts. This Agreement may be
executed in two or more counterparts, each of which shall be deemed an original,
but all of which shall constitute but one and the same instrument.

                  10.5 Severability. In the event that any particular provision
or provisions of this Agreement shall for any reason hereafter be determined to
be unenforceable, or in violation of any law, governmental order or regulation,
such unenforceability or violation shall not affect the remaining provisions of
this Agreement, which shall continue in full force and effect and be binding
upon the respective parties hereto.

<PAGE>

                  10.6 Assignment. Unless otherwise provided, the rights and
obligations of Eurotech and Kurchatov under this Agreement shall be binding upon
and inure to the benefit of the parties and their respective representatives,
administrators, heirs, successors and assigns, but may not be assigned by either
party without the prior written consent of the other party.

                  10.7 Announcements. Eurotech and Kurchatov agree that except
in accordance with applicable laws, neither will make any public announcement
concerning the consummation of the transactions provided herein without first
obtaining the written permission of the other.

                  10.8 Expenses. Except as otherwise provided herein, Eurotech
and Kurchatov agree that each of the parties hereto shall bear its own expenses
incurred in connection with the execution and delivery of this Agreement and the
consummation of the transactions contemplated hereby.

                  10.9 Headings. All headings in this Agreement are for
convenience only and shall not affect the meaning of any provision hereof.

                  10.10 Entirety of Agreement. This Agreement states the entire
agreement of the parties, merges all prior negotiations, agreements and
understandings, if any, and states in full the representations and warranties
which have induced this Agreement, there being no representations or warranties
other than those herein stated.

                  10.11 Benefit of Agreement. This Agreement is for the benefit
of the parties hereto only, and there is no intent to create benefits, rights or
remedies in any other persons or entities.

                  10.12 No Strict Construction. The language of this Agreement
shall be construed as a whole, according to its fair meaning and intendment, and
not strictly for or against either party hereto, regardless of who drafted or
was principally responsible for drafting the Agreement or any specific term or
condition thereof.

                  10.13 Execution Knowing and voluntary. In executing this
Agreement, Eurotech and Kurchatov severally acknowledge and represent that each
(a) has fully and carefully read and considered this Agreement, (b) has been or
has had the opportunity to be fully apprised by his, her or its attorneys of the
legal effect and meaning of this document and all terms and conditions hereof,
(c) has been afforded the opportunity to negotiate as to any and all terms
hereof and (d) is executing this Agreement voluntarily, free from any influence,
coercion or duress of any kind.

                  10.14 Attorneys' Fees. In any action at law or in equity to
enforce or construe any provisions or rights under this Agreement, the
unsuccessful party or parties to such litigation, as determined by a court
pursuant to a final order, judgment or decree, shall pay to the successful party
or parties all costs, expenses and reasonable attorneys' fees incurred by such
successful party or parties (including, without limitation, such costs, expenses
and fees on any appeal), which costs, expenses and attorneys' fees shall be
included as part of any order, judgment or decree.
<PAGE>

                  10.15 Confidential Information. All confidential, financial or
business information (except publicly available or freely usable material
otherwise obtained from another source) respecting the parties hereto will be
used solely by any party in connection with the within transaction, will be
revealed only to employees or contractors of the other parties who are necessary
to the conduct of such transactions, and will be otherwise held in strict
confidence. In the event the transactions contemplated by this Agreement are not
consummated, all confidential information received by any party thereto shall be
returned to the party delivering such confidential information. The terms of
this Section 10.15 shall survive the termination of this Agreement.

                  IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be dully executed by their authorized representatives as of the day
and year first above written.

                                                 "EUROTECH"
ATTEST:                                          EUROTECH, LTD.,
                                                 a District of Columbia
Corporation

By:                                           By: /s/ Don V. Hahnfeldt
   -----------------------------                 ------------------------------
   Secretary                                     Don V. Hahnfeldt,
   (Seal)                                        President

                                                 "KURCHATOV"
ATTEST:                                          KURCHATOV RESEARCH
                                                 HOLDINGS, LTD.,
                                                 a Delaware Corporation

By:                                           By: /s/ Hans Joachim Skrobanek
   -----------------------------                 ------------------------------
   Secretary                                     Hans Joachim Skrobanek,
   (Seal)                                        President

                                                 "SPINNERET"
ATTEST:                                       SPINNERET FINANCIAL SYSTEMS, INC.,
                                                  a Delaware Corporation

By:                                           By: /s/ Fred Hahnfeldt
   -----------------------------                 ------------------------------
   Secretary                                     Fred Hahnfeldt,
   (Seal)                                        President (Seal)

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