Document:

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                                                                    EXHIBIT 10.3

                                CORECHANGE, INC.

                        2000 EMPLOYEE STOCK PURCHASE PLAN

         The following constitute the provisions of the 2000 Employee Stock
Purchase Plan of Corechange, Inc.

         1. PURPOSE. The purpose of the Plan is to provide employees of the
Company and its Designated Subsidiaries with an opportunity to purchase Common
Stock of the Company through accumulated payroll deductions. It is the intention
of the Company to have the Plan qualify as an "Employee Stock Purchase Plan"
under Section 423 of the Internal Revenue Code of 1986, as amended. The
provisions of the Plan, accordingly, shall be construed so as to extend and
limit participation in a manner consistent with the requirements of that section
of the Code.

         2. DEFINITIONS.

                  a. "BOARD" shall mean the Board of Directors of the Company.

                  b. "CODE" shall mean the Internal Revenue Code of 1986, as
amended.

                  c. "COMMON STOCK" shall mean the Common Stock of the Company.

                  d. "COMPANY" shall mean Corechange, Inc., and any Designated
Subsidiary of the Company.

                  e. "COMPENSATION" means the amount of money reportable on an
Employee's Federal Income Tax Withholding Statement (Form W-2) before any
withholdings for health insurance or under a Section 401(k), 125, 129 or similar
plan, including without limitation, salary, wages, overtime, shift
differentials, bonuses and incentive compensation, but excluding third party
sick or disability pay, allowances and reimbursements for expenses such as
relocation allowances or travel expenses, whether specifically designated as
such or designated as signing bonuses, income or gains attributable to
restricted stock, stock options, stock appreciation rights or other similar
equity based compensation, imputed income for non cash items, such as life
insurance premiums, and similar items, whether or not specifically itemized on
the Form W-2.

                  f. "DESIGNATED SUBSIDIARY" shall mean any Subsidiary which has
been designated by the Board from time to time in its sole discretion as
eligible to participate in the Plan.

                  g. "EMPLOYEE" shall mean any individual who is an employee of
the Company for tax purposes whose customary employment with the Company is more
than five (5) months in any calendar year. For purposes of the Plan, the
employment relationship shall be treated as continuing intact while the
individual is on sick leave or other bona fide leave of absence approved by the
Company. If a sick leave or other leave of absence exceeds 90 days and the
individual's right to reemployment is not guaranteed either by statute or by
contract, the

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individual's employment relationship with the Company shall be deemed to have
terminated on the 91st day of such leave.

                  h. "ENROLLMENT DATE" shall mean the first day of each Offering
Period.

                  i. "EXERCISE DATE" shall mean the last Trading Day of each
Purchase Period.

                  j. "FAIR MARKET VALUE" shall mean the value of the Common
Stock on any given date of determination, determined as follows:

                           (1) If the Common Stock is listed on any established
stock exchange or a national market system, including without limitation The
Nasdaq National Market or The Nasdaq Small Cap Market of The Nasdaq Stock
Market, its Fair Market Value shall be the closing sales price for such stock
(or the closing bid, if no sales were reported) as quoted on such exchange or
system for the last market trading day prior to the date of such determination,
as reported in THE WALL STREET JOURNAL or such other source as the Board deems
reliable; or

                           (2) If the Common Stock is regularly quoted on the
over-the-counter market, its Fair Market Value shall be the mean of the closing
bid and asked price for such stock as quoted on such market for the last market
trading day prior to the date of such determination, as reported in THE WALL
STREET JOURNAL or such other source as the Board deems reliable; or

                           (3) In the absence of an established market for the
Common Stock, the Fair Market Value of the Common Stock shall be determined in
good faith by the Board.

                  k. "OFFERING PERIODS" shall mean the periods of approximately
twenty-four (24) months during which an option granted pursuant to the Plan may
be exercised, commencing on the first Trading Day on or after September 1 and
March 1 of each year and terminating on the last Trading Day in the periods
ending twenty-four months later; provided, however, that the first Offering
Period under the Plan shall commence with the first Trading Day of the month
first commencing after the date on which the Common Stock is first traded on the
Nasdaq National Market (such date referred to as the "First Offering
Commencement Date"); and provided further that if the number of days between the
date the Common Stock is first traded and the First Offering Commencement Date
is less than 15 days, then the first Offering Period shall commence on the first
Trading Day of the following month. The duration and timing of Offering Periods
may be changed pursuant to Section 4 of this Plan.

                  l. "PLAN" shall mean this Employee Stock Purchase Plan.

                  m. "PURCHASE PERIOD" shall mean the approximately six month
period commencing on the first Trading Day on or after September 1 and March 1
of each year and terminating approximately six (6) months later on the last
Trading Day on or before the following February 28 and August 31 of each year,
except that (i) the first Purchase Period of any Offering Period shall commence
on the Enrollment Date and terminate approximately six (6) months later on the
last Trading Day on or before the following February 28 or August 31 and (ii)
the first Purchase Period of the first Offering Period shall commence on the
Enrollment Date of the first Offering Period and terminate approximately six
months thereafter on the last Trading

                                      -2-
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Day in such period and continue in six-month installments thereafter. The
duration and timing of Purchase Periods may be changed pursuant to Section 4 of
the Plan.

                  n. "PURCHASE PRICE" shall mean 85% of the Fair Market Value of
a share of Common Stock on the Enrollment Date or on the applicable Exercise
Date, whichever is lower; provided however, that, in the event (i) the Company's
stockholders approve an increase in the number of shares available for issuance
under the Plan, (ii) all or a portion of such additional shares are to be issued
with respect to one or more Offering Periods that are underway at the time of
such stockholder approval ("NEW SHARES"), and (iii) the Fair Market Value of a
share of Common Stock on the date of such approval (the "AUTHORIZATION DATE
FMV") is higher than the Fair Market Value on the Enrollment Date for any such
Offering Period, the Purchase Price with respect to New Shares shall be 85% of
the Authorization Date FMV or the Fair Market Value of a share of Common Stock
on the Exercise Date, whichever is lower.

                  o. "RESERVES" shall mean the number of shares of Common Stock
covered by each outstanding option under the Plan which has not yet been
exercised and the number of shares of Common Stock which have been authorized
for issuance under the Plan but not yet placed under option.

                  p. "SUBSIDIARY" shall mean a corporation, domestic or foreign,
of which not less than 50% of the voting shares are held by the Company or a
Subsidiary, whether or not such corporation now exists or is hereafter organized
or acquired by the Company or a Subsidiary.

                  q. "TRADING DAY" shall mean a day on which the established
stock exchange, the national market system or the over-the-counter market on
which the Common Stock is traded is open for trading.

         3. ELIGIBILITY.

                  a. Any Employee who shall be employed by the Company at least
seven (7) calendar days prior to a given Enrollment Date shall be eligible to
participate in the Offering Period commencing on such Enrollment Date; provided
that an Employee may not participate in more than one Offering Period at the
same time.

                  b. Any provisions of the Plan to the contrary notwithstanding,
no Employee shall be granted an option under the Plan (i) to the extent that,
immediately after the grant, such Employee (or any other person whose stock
would be attributed to such Employee pursuant to Section 424(d) of the Code)
would own capital stock of the Company and/or hold outstanding options to
purchase such stock possessing five percent (5%) or more of the total combined
voting power or value of all classes of the capital stock of the Company or of
any Subsidiary, or (ii) to the extent that his or her rights to purchase stock
under all employee stock purchase plans of the Company and its Subsidiaries
accrues at a rate which exceeds Twenty-Five Thousand Dollars ($25,000) worth of
stock (determined at the Fair Market Value of a share of Common Stock at the
time such option is granted) for each calendar year in which such option is
outstanding at any time. In the event that an Employee may not be granted an
option under the Plan because of the foregoing restrictions, the Employee shall
be granted an option to purchase the maximum number of shares that would not
violate the foregoing restrictions.

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         4. OFFERING PERIODS. The Plan shall be implemented by consecutive,
overlapping Offering Periods with a new Offering Period commencing on the first
Trading Day on or after September 1 and March 1 of each year, or on such other
date as the Board shall determine, and continuing thereafter until terminated in
accordance with Section 17 hereof; provided however that the first Offering
Period under the Plan shall commence on the date set forth in the definition of
"Offering Periods" in Section 2(k). The Board shall have the power to change the
duration of Offering Periods and Purchase Periods (including the commencement
dates thereof) with respect to future offerings without stockholder approval if
such change is announced at least five (5) days prior to the scheduled beginning
of the first Offering Period or Purchase Period to be affected thereafter.

         5. PARTICIPATION.

                  a. An eligible Employee may become a participant in the Plan
by completing a subscription agreement in the form of EXHIBIT A or such other
form as the Company may deem satisfactory and filing it with the Company's
payroll office or such other office as the Company may direct prior to the
applicable Enrollment Date.

                  b. Payroll deductions for a participant shall commence on the
first payroll following the Enrollment Date and shall end on the last payroll in
the Offering Period to which such authorization is applicable, unless sooner
terminated by the participant as provided in Section 9 hereof.

         6. PAYROLL DEDUCTIONS.

                  a. At the time a participant files his or her subscription
agreement, he or she shall elect to have payroll deductions made on each pay day
during the Offering Period in an amount not exceeding ten percent (10%) of the
Compensation which he or she receives on each pay day during the Offering
Period.

                  b. All payroll deductions made for a participant shall be
credited to his or her account under the Plan and shall be withheld in whole
percentages only. A participant may not make any additional payments into such
account.

                  c. A participant may discontinue his or her participation in
the Plan as provided in Section 9 hereof, or may increase or decrease the rate
of his or her payroll deductions to not more than 10 percent (10%) or less than
zero percent (0%) not more than one (1) time during each Purchase Period by
completing or filing with the Company a new subscription agreement authorizing
such change in payroll deduction rate. The Board may, in its discretion,
increase or decrease the number of participation rate changes that may be made
by a participant during any Purchase Period. The change in rate shall be
effective with the first full payroll period following the fifth (5th) business
day after the Company's receipt of the new subscription agreement. A
participant's subscription agreement shall remain in effect for successive
Offering Periods unless terminated as provided in Section 9 hereof.

                  d. At the time the option is exercised, in whole or in part,
or at the time any of the Company's Common Stock issued under the Plan is
disposed of, the participant must make adequate provision for the Company's
federal, state, or other tax withholding obligations,

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if any, which arise upon the exercise of the option or the disposition of the
Common Stock. At any time, the Company may, but shall not be obligated to,
withhold from the participant's compensation the amount necessary for the
Company to meet applicable withholding obligations, including any withholding
required to make available to the Company any tax deductions or benefits
attributable to sale or early disposition of Common Stock by the Employee.

         7. GRANT OF OPTION. On the Enrollment Date of each Offering Period,
each eligible Employee participating in such Offering Period shall be granted an
option to purchase (at the applicable Purchase Price) up to a whole number of
shares of the Company's Common Stock (the "Option Shares") determined by
dividing $50,000 by the Fair Market Value of a share of Common Stock on the
Enrollment Date (subject to any adjustment pursuant to Section 16), and provided
that such purchase shall be subject to the limitations set forth in Sections
3(b) and 12 hereof. The option shall be exercisable as to 25% of the Option
Shares on each Exercise Date during the Offering Period. Exercise of the option
shall occur as provided in Section 8 hereof, unless the participant has
withdrawn pursuant to Section 9 hereof. The option shall expire on the last day
of the Offering Period.

         8. EXERCISE OF OPTION. Unless a participant withdraws from the Plan as
provided in Section 9 hereof, his or her option for the purchase of shares shall
be exercised automatically on each Exercise Date during the Offering Period, and
a number of full shares not exceeding the number of shares as to which such
participant's option is exercisable on such Exercise Date shall be purchased for
such participant at the applicable Purchase Price with the accumulated payroll
deductions in his or her account. No fractional shares shall be purchased. Any
other monies left over in a participant's account after the last Exercise Date
in the Offering Period shall be returned to the participant. During a
participant's lifetime, a participant's option to purchase shares hereunder is
exercisable only by him or her.

         9. WITHDRAWAL.

                  a. A participant may withdraw all but not less than all the
payroll deductions credited to his or her account and not yet used to exercise
his or her option under the Plan at any time by giving written notice to the
Company in the form of EXHIBIT B to this Plan; provided that no Employee may
withdraw his or her payroll deductions less than ten (10) Trading Days prior to
an Exercise Date. All of the participant's payroll deductions credited to his or
her account shall be paid to such participant promptly after receipt of notice
of withdrawal and such participant's option for the Offering Period shall be
automatically terminated upon receipt of such notice, and no further payroll
deductions from such participant for the purchase of shares shall be made for
such Offering Period. If a participant withdraws from an Offering Period,
payroll deductions shall not resume at the beginning of the succeeding Offering
Period unless the participant delivers to the Company a new subscription
agreement.

                  b. A participant's withdrawal from an Offering Period shall
not have any effect upon his or her eligibility to participate in any similar
plan which may hereafter be adopted by the Company or in succeeding Offering
Periods.

                                      -5-
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         10. TERMINATION OF EMPLOYMENT. Upon a participant's ceasing to be an
Employee, for any reason, he or she shall be deemed to have elected to withdraw
from the Plan, such participant's option shall be automatically terminated and
the accumulated payroll deductions credited to such participant's account during
the Offering Period but not yet used to exercise his or her option shall be
returned to such participant or, in the case of his or her death, to the
executor or administrator of the Employee's estate or if no such executor or
administrator has been appointed to the knowledge of the Company, to such other
person(s) as the Company may, in its discretion, designate. If, prior to the
last day of the Offering Period, the Designated Subsidiary by which an Employee
is employed shall cease to be a Subsidiary of the Company, or if the Employee is
transferred to a Subsidiary of the Company that is not a Designated Subsidiary,
the Employee shall be deemed to have terminated employment for the purposes of
this Plan.

         11. INTEREST. No interest shall accrue on the payroll deductions of a
participant in the Plan.

         12. STOCK.

                  a. Subject to adjustment upon changes in capitalization of the
Company as provided in Section 16 hereof, the maximum number of shares of the
Company's Common Stock which shall be made available for sale under the Plan
shall be 250,000 shares. If, on a given Exercise Date, the number of shares with
respect to which options are to be exercised exceeds the number of shares then
available under the Plan, the Company shall make a pro rata allocation of the
shares remaining available for purchase in as uniform a manner as shall be
practicable and as it shall determine to be equitable.

                  b. The participant shall have no interest or voting right in
shares covered by his or her option until such option has been exercised.

         13. ADMINISTRATION. The Plan shall be administered by the Board or a
committee of members of the Board appointed by the Board. The Board or its
committee shall have full and exclusive discretionary authority to construe,
interpret and apply the terms of the Plan, to determine eligibility and to
adjudicate all disputed claims filed under the Plan. Every finding, decision and
determination made by the Board or its committee shall, to the full extent
permitted by law, be final and binding upon all parties.

         14. TRANSFERABILITY. Neither payroll deductions credited to a
participant's account nor any rights with regard to the exercise of an option or
to receive shares under the Plan may be assigned, transferred, pledged or
otherwise disposed of in any way (other than by will or the laws of descent and
distribution by the participant). Any such attempt at assignment, transfer,
pledge or other disposition shall be without effect, except that the Company may
treat such act as an election to withdraw funds from an Offering Period in
accordance with Section 9 hereof.

         15. USE OF FUNDS. All payroll deductions received or held by the
Company under the Plan may be used by the Company for any corporate purpose, and
the Company shall not be obligated to segregate such payroll deductions.

                                      -6-
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         16. ADJUSTMENTS UPON CHANGES IN CAPITALIZATION, DISSOLUTION,
LIQUIDATION, MERGER OR ASSET SALE.

                  a. CHANGES IN CAPITALIZATION. Subject to any required action
by the stockholders of the Company, the maximum number of shares of Common Stock
available for sale under the Plan, the Reserves, the maximum number of shares
each participant may purchase during each Purchase Period (pursuant to Section
7), as well as the price per share and the number of shares of Common Stock
covered by each option under the Plan which has not yet been exercised, shall be
proportionately adjusted for any increase or decrease in the number of issued
shares of Common Stock resulting from a stock split, reverse stock split, stock
dividend, combination or reclassification of the Common Stock. Such adjustment
shall be made by the Board, whose determination in that respect shall be final,
binding and conclusive. Except as expressly provided herein, no issuance by the
Company of shares of stock of any class, or securities convertible into shares
of stock of any class, shall affect, and no adjustment by reason thereof shall
be made with respect to, the number or price of shares of Common Stock subject
to an option.

                  b. DISSOLUTION OR LIQUIDATION. In the event of the proposed
dissolution or liquidation of the Company, the Board shall shorten any Purchase
Periods then in progress by setting a new Exercise Date (the "NEW EXERCISE
DATE"), and any Offering Period shall terminate on the New Exercise Date. The
New Exercise Date shall be before the date of the Company's proposed dissolution
or liquidation. The Board shall notify each participant in writing, at least ten
(10) days prior to the New Exercise Date, that the Exercise Date for the
participant's option has been changed to the New Exercise Date and that the
participant's option shall be exercised automatically on the New Exercise Date,
unless prior to such date the participant has withdrawn from the Offering Period
as provided in Section 9 hereof.

                  c. MERGER OR ASSET SALE. If the Company shall at any time
merge or consolidate with another corporation and the holders of the capital
stock of the Company immediately prior to such merger or consolidation continue
to hold at least 60% by voting power of the capital stock of the surviving
corporation ("Continuity of Control"), the holder of each option then
outstanding will thereafter be entitled to receive at the next Exercise Date
upon the exercise of such option for each share as to which such option shall be
exercised the securities or property which a holder of one share of Common Stock
was entitled to upon and at the time of such merger or consolidation, and the
Board shall take such steps in connection with such merger or consolidation as
the Board shall deem necessary to assure that the provisions of Section 16(a)
shall thereafter be applicable, as nearly as reasonably may be, in relation to
the said securities or property as to which such holder of such option might
thereafter be entitled to receive thereunder.

         In the event of a merger or consolidation of the Company with or into
another corporation which does not involve Continuity of Control, or which
involves a sale of all or substantially all of the assets of the Company (an
"Acquisition"), while unexercised options remain outstanding under the Plan, all
options outstanding as of the effective date of the Acquisition shall be deemed
assumed or substituted for and each holder of an outstanding option shall be
entitled, upon exercise of such option, to receive in lieu of shares of Common
Stock, shares of such stock or other securities as the holders of shares of
Common Stock received

                                      -7-
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pursuant to the terms of the Acquisition. Notwithstanding the foregoing, in the
event that the acquiring or succeeding corporation (or an affiliate thereof)
does not agree to assume or substitute for the options, then the Board shall
shorten any Purchase Periods then in progress by setting a New Exercise Date,
and any Offering Periods then in progress shall terminate on the New Exercise
Date. The New Exercise Date shall be before the effective date of the
Acquisition. The Board shall notify each participant in writing, at least ten
(10) days prior to the New Exercise Date, that the Exercise Date for the
participant's option has been changed to the New Exercise Date and that the
participant's option shall be exercised automatically on the New Exercise Date,
unless prior to such date the participant has withdrawn from the Offering Period
as provided in Section 9 hereof.

         17. AMENDMENT OR TERMINATION.

                  a. The Board of Directors of the Company may at any time and
for any reason terminate or amend the Plan. Except as provided in Section 16
hereof, no such termination can affect options previously granted, provided that
an Offering Period may be terminated by the Board of Directors on any Exercise
Date if the Board determines that the termination of the Plan is in the best
interests of the Company and its stockholders. Except as provided in Section 16
hereof, no amendment may make any change in any option theretofore granted which
adversely affects the rights of any participant without the consent of the
participant. To the extent necessary to comply with Section 423 of the Code (or
any successor rule or provision or any other applicable law, regulation or stock
exchange rule), if applicable, the Company shall obtain stockholder approval in
such a manner and to such a degree as required.

                  b. Without stockholder consent and without regard to whether
any participant rights may be considered to have been "adversely affected," the
Board (or its committee) shall be entitled to change the Offering Periods,
change the Purchase Periods, limit the frequency and/or number of changes in the
amount withheld during an Offering Period, establish the exchange ratio
applicable to amounts withheld in a currency other than U.S. dollars, permit
payroll withholding in excess of the amount designated by a participant in order
to adjust for delays or mistakes in the Company's processing of properly
completed withholding elections, establish reasonable waiting and adjustment
periods and/or accounting and crediting procedures to ensure that amounts
applied toward the purchase of Common Stock for each participant properly
correspond with amounts withheld from the participant's Compensation, and
establish such other limitations or procedures as the Board (or its committee)
determines in its sole discretion advisable which are consistent with the Plan.

         18. NOTICES. All notices or other communications by a participant to
the Company under or in connection with the Plan shall be deemed to have been
duly given when received in the form specified by the Company at the location,
or by the person, designated by the Company for the receipt thereof.

         19. CONDITIONS UPON ISSUANCE OF SHARES. Shares shall not be issued with
respect to an option unless the exercise of such option and the issuance and
delivery of such shares pursuant thereto shall comply with all applicable
provisions of law, domestic or foreign, including, without limitation, the
Securities Act of 1933, as amended, the Securities Exchange Act of 1934,

                                      -8-
<PAGE>

as amended, the rules and regulations promulgated thereunder, and the
requirements of any stock exchange upon which the shares may then be listed, and
shall be further subject to the approval of counsel for the Company with respect
to such compliance.

                  As a condition to the exercise of an option, the Company may
require the person exercising such option to represent and warrant at the time
of any such exercise that the shares are being purchased only for investment and
without any present intention to sell or distribute such shares if, in the
opinion of counsel for the Company, such a representation is required by any of
the aforementioned applicable provisions of law.

         20. AUTOMATIC TRANSFER TO LOW PRICE OFFERING PERIOD. To the extent
permitted by any applicable laws, regulations, or rules of the established stock
exchange, national market system or over-the-counter market on which the
Company's Common Stock trades, if the Fair Market Value of the Common Stock on
any Exercise Date in an Offering Period is lower than the Fair Market Value of
the Common Stock on the Enrollment Date of such Offering Period, then all
participants in such Offering Period shall be automatically withdrawn from such
Offering Period immediately after the exercise of their options on such Exercise
Date and automatically re-enrolled in the immediately following Offering Period
as of the first day thereof.

         21. GOVERNMENTAL REGULATIONS. The Company's obligation to sell and
deliver Common Stock under this Plan is subject to listing on an established
stock exchange or quotation on a national market system or an over-the-counter
market (to the extent the Common Stock is then so listed or quoted) and the
approval of all governmental authorities required in connection with the
authorization, issuance or sale of such stock.

         22. GOVERNING LAW. The Plan shall be governed by Massachusetts law
except to the extent that such law is preempted by federal law.

         23. SOURCE OF SHARES. Shares may be issued upon exercise of an option
from authorized but unissued Common Stock, from shares held in the treasury of
the Company, or from any other proper source.

         24. NOTIFICATION UPON SALE OF SHARES. Each Employee agrees, by entering
the Plan, to promptly give the Company notice of any disposition of shares
purchased under the Plan where such disposition occurs within two years after
the date of grant of the option pursuant to which such shares were purchased.

         25. EFFECTIVE DATE. The Plan shall take effect upon the date of the
Company's initial public offering of its equity securities registered on Form
S-1 with the Securities and Exchange Commission. It shall continue in effect for
a term of ten (10) years unless sooner terminated under Section 17 hereof.

                                      -9-
<PAGE>

                                    EXHIBIT A
                                CORECHANGE, INC.

                        2000 EMPLOYEE STOCK PURCHASE PLAN

                             SUBSCRIPTION AGREEMENT

_______  Original Application                     Enrollment Date:  ____________
_______  Change in Payroll Deduction Rate (Complete only Section 2 and date and
         sign).

         1. ______________________________ hereby elects to participate in the
Corechange, Inc. 2000 Employee Stock Purchase Plan (the "EMPLOYEE STOCK PURCHASE
PLAN") and subscribes to purchase shares of the Company's Common Stock in
accordance with this Subscription Agreement and the Employee Stock Purchase
Plan.

         2. I hereby authorize payroll deductions from each paycheck in the
amount of ____% of my Compensation on each payday (not to exceed 10%) during the
Offering Period in accordance with the Employee Stock Purchase Plan. (Please
note that no fractional percentages are permitted.)

         3. I understand that said payroll deductions shall be accumulated for
the purchase of shares of Common Stock at the applicable Purchase Price
determined in accordance with the Employee Stock Purchase Plan. I understand
that if I do not withdraw from an Offering Period, any accumulated payroll
deductions will be used to automatically exercise my option.

         4. I have received a copy of the complete Employee Stock Purchase Plan.
I understand that my participation in the Employee Stock Purchase Plan is in all
respects subject to the terms of the Plan. I understand that my ability to
exercise the option under this Subscription Agreement is subject to stockholder
approval of the Employee Stock Purchase Plan.

         5. I understand that if I dispose of any shares received by me pursuant
to the Plan within two years after the Enrollment Date (the first day of the
Offering Period during which I purchased such shares) or one year after the
Exercise Date, I will be treated for federal income tax purposes as having
received ordinary income at the time of such disposition in an amount equal to
the excess of the fair market value of the shares at the time such shares were
purchased by me over the price which I paid for the shares. I HEREBY AGREE TO
NOTIFY THE COMPANY IN WRITING WITHIN 30 DAYS AFTER THE DATE OF ANY DISPOSITION
OF MY SHARES AND I WILL MAKE ADEQUATE PROVISION FOR FEDERAL, STATE OR OTHER TAX
WITHHOLDING OBLIGATIONS, IF ANY, WHICH ARISE UPON THE DISPOSITION OF THE COMMON
STOCK. The Company may, but will not be obligated to, withhold from my
compensation the amount necessary to meet any applicable withholding obligation
including any withholding necessary to make available to the Company any tax
deductions or benefits attributable to sale or early disposition of Common Stock
by me.

<PAGE>

         6. I hereby agree to be bound by the terms of the Employee Stock
Purchase Plan. The effectiveness of this Subscription Agreement is dependent
upon my eligibility to participate in the Employee Stock Purchase Plan.

NAME:  (Please Print) __________________________________________________________
                           (First)              (Middle)             (Last)

__________________________________              ________________________________
Relationship

                                                ________________________________
                                                Address

Employee's Social
Security Number:           _____________________________________________________

Employee's Address:        _____________________________________________________
                           _____________________________________________________
                           _____________________________________________________

I UNDERSTAND THAT THIS SUBSCRIPTION AGREEMENT SHALL REMAIN IN EFFECT THROUGHOUT
SUCCESSIVE OFFERING PERIODS UNLESS TERMINATED BY ME.

Dated:  _____________________________           ________________________________
                                                Signature of Employee
                                                (Please print)

                                                ________________________________
                                                Spouse's Signature (If
                                                beneficiary other than Spouse)

<PAGE>

                                    EXHIBIT B
                                 CORECHANGE INC.

                        2000 EMPLOYEE STOCK PURCHASE PLAN

                              NOTICE OF WITHDRAWAL

         The undersigned participant in the Offering Period of the Corechange,
Inc. 2000 Employee Stock Purchase Plan which began on ________________, 2000
(the "ENROLLMENT DATE") hereby notifies the Company that he or she hereby
withdraws from the Offering Period. He or she hereby directs the Company to pay
to the undersigned as promptly as practicable all the payroll deductions
credited to his or her account with respect to such Offering Period. The
undersigned understands and agrees that his or her option for such Offering
Period will be automatically terminated. The undersigned understands further
that no further payroll deductions will be made for the purchase of shares in
the current Offering Period and the undersigned shall be eligible to participate
in succeeding Offering Periods.

                                           Name and Address of Participant:

                                           ___________________________________

                                           ___________________________________

                                           ___________________________________

                                           Signature:

                                           ___________________________________

                                           Date:______________________________<PAGE>

                                                                    EXHIBIT 10.4

                      SERIES B CONVERTIBLE PREFERRED STOCK

                               PURCHASE AGREEMENT

                             DATED FEBRUARY 18, 2000

                                  BY AND AMONG

                                CORECHANGE, INC.

           AND THE PERSONS LISTED ON THE SCHEDULE OF PURCHASERS HERETO

<PAGE>

                          LIST OF DISCLOSURE SCHEDULES

Capitalization Schedule
Subsidiary Schedule
Restrictions Schedule
Financial Statements Schedule
Liabilities Schedule
Adverse Change Schedule
Developments Schedule
Assets Schedule
Taxes Schedule
Contracts Schedule
Intellectual Property Schedule
Litigation Schedule
Brokerage Schedule
Consents Schedule
Insurance Schedule
Employees Schedule
Employee Benefits Schedule
Compliance Schedule
Affiliated Transactions Schedule
Customers Schedule

<PAGE>

                                LIST OF EXHIBITS

Exhibit A - Certificate of Amendment of Certificate of Incorporation

Exhibit B - Registration Agreement

Exhibit C - Amended and Restated Stockholders Agreement

Exhibit D - Opinion of Counsel

<PAGE>

                               PURCHASE AGREEMENT

         THIS SERIES B CONVERTIBLE PREFERRED STOCK PURCHASE AGREEMENT (this
"AGREEMENT") is made as of February 18, 2000 by and among Corechange, Inc. a
Delaware corporation (the "COMPANY"), and the Persons listed on the SCHEDULE OF
PURCHASERS attached hereto (collectively referred to herein as the "FIRST
PURCHASERS" and individually as a "FIRST PURCHASER"). The First Purchasers and
any subsequent purchasers of shares of Series B Preferred who are made a party
to this Agreement pursuant to Section 1D hereof (the "SUBSEQUENT PURCHASERS")
are collectively referred to herein as the "PURCHASERS." Except as otherwise
indicated herein, capitalized terms used herein are defined in SECTION 6 hereof.

         The parties hereto agree as follows:

         SECTION 1. AUTHORIZATION AND CLOSING.

         1A. AUTHORIZATION OF THE SERIES B PREFERRED. The Company shall
authorize the issuance and sale to the Purchasers of its Series B Convertible
Preferred Stock, par value $0.01 per share (the "SERIES B PREFERRED"), each
having the powers, rights and preferences set forth in the Certificate of
Amendment of Certificate of Incorporation attached hereto as EXHIBIT A.

         1B. PURCHASE AND SALE OF THE SERIES B PREFERRED . At the Closing, the
Company shall sell to each Purchaser and, subject to the terms and conditions
set forth herein, each Purchaser shall purchase from the Company the number of
shares of Series B Preferred set forth opposite such Purchaser's name on the
SCHEDULE OF PURCHASERS attached hereto at a price of $5.837 per share. The sale
of the Series B Preferred shall constitute a separate sale hereunder as to each
such Purchaser.

         1C. THE CLOSING. Each closing of the separate purchases and sales of
the Series B Preferred under this Agreement (the "CLOSING") shall take place at
the offices of Kirkland & Ellis or at such other place as may be mutually
agreeable to the Company and each Purchaser at such Closing. At each Closing,
the Company shall deliver to each Purchaser at such Closing stock certificates
evidencing the Series B Preferred to be purchased by such Purchaser, registered
in such Purchaser's name, bearing the legend set forth in SECTION 7D, upon
payment of the purchase price therefor by a cashier's or certified check, by
wire transfer of immediately available funds to the Company's account, by
cancellation of the principal amount outstanding under the Company's 8%
Convertible Subordinated Notes and the interest which may be accrued and owing
thereon as set forth opposite each Purchaser's name on the Schedule of
Purchasers. Each Purchaser purchasing shares of Series B Preferred through the
cancellation of the 8% Notes shall surrender the original copy of their
respective 8% Notes to the Company at the Closing (except where such 8% Notes
although purchased was never issued) in the aggregate amount set forth opposite
such Purchaser's name on the SCHEDULE OF PURCHASERS.

                                       1
<PAGE>

         1D. FIRST CLOSING. At the First Closing (as defined below), subject to
the terms and conditions of this Agreement, the Company will sell and issue to
each of the First Purchasers, and each of the First Purchasers will purchase the
number of shares of Series B Preferred set forth opposite such First Purchaser's
name on the Schedule of Purchasers for the purchase price of $5.837 per share.
The first closing of the sale and purchase of the Series B Preferred (the "FIRST
CLOSING") shall be held at 10:00 a.m. on February 18, 2000 or at such other time
and date as are mutually agreeable to the Company and the First Purchasers.

         1E. SUBSEQUENT CLOSING. To the extent that at the First Closing the
Company does not sell and issue to the First Purchasers a total of 4,000,000
shares of Series B Preferred, the Company, may, but shall not be obligated to,
offer and sell up to a number of shares of Series B Preferred equal to the
difference between the number of shares of Series B Preferred sold and issued at
the First Closing and 4,000,000 shares (the "SUBSEQUENT SHARES") at a second
closing (the "SECOND CLOSING", and together with the First Closing, the
"CLOSINGS") to be held no later than April 15, 2000 at a price of $5.837 per
share. It shall be a condition to the consummation of the Second Closing that
the Subsequent Purchasers purchasing in such Second Closing shall become parties
to this Agreement by the execution and delivery of counterpart signature pages
in such form as may be acceptable to the Company and shall become subject to the
terms thereof.

         SECTION 2. CONDITIONS OF EACH PURCHASER'S OBLIGATION AT THE CLOSING.
The obligation of each Purchaser to purchase and pay for the Series B Preferred
at the Closing is subject to the satisfaction (or waiver by such Purchaser) as
of such Closing of the following conditions:

         2A. REPRESENTATIONS AND WARRANTIES; COVENANTS. The representations and
warranties contained in SECTION 5 hereof shall be true and correct in all
material respects at and as of the First Closing as though then made, except to
the extent of changes expressly contemplated herein resulting from the
transactions contemplated herein, and the Company shall have performed in all
material respects all of the covenants required to be performed by it hereunder
prior to the Closing.

         2B. AMENDMENT OF CERTIFICATE OF INCORPORATION. The Company's
Certificate of Incorporation shall have been amended to include the provisions
set forth in EXHIBIT A hereto, shall be in full force and effect under the laws
of Delaware as of the Closing as so amended and shall not have been further
amended or modified.

         2C. REGISTRATION AGREEMENT. The Company and the First Purchasers shall
have entered into a registration agreement in form and substance as set forth in
EXHIBIT B attached hereto (the "REGISTRATION AGREEMENT"), and the Registration
Agreement shall be in full force and effect as of the Closing.

         2D. STOCKHOLDERS AGREEMENT. The Company, the First Purchasers, each
holder of Series A Preferred, and Ulf Arnetz shall have entered into a
stockholders agreement in form and substance set forth in EXHIBIT C attached
hereto (the "STOCKHOLDERS AGREEMENT") which amends, restates and supercedes
the Stockholders Agreement dated January 21, 1998 as amended, and the
Stockholders Agreement shall be in full force and effect as of the Closing.

                                       2
<PAGE>

         2E. SALE OF SERIES B PREFERRED TO EACH PURCHASER. The Company shall
have simultaneously sold to each Purchaser the Series B Preferred to be
purchased by such Purchaser hereunder at such Closing and shall have received
payment therefor in full.

         2F. KEY-MAN LIFE INSURANCE. The Company shall have obtained a key-man
life insurance policy on the life of Ulf Arnetz, in the face amount of
$2,000,000, which policy shall be in full force and effect as of the First
Closing. Such insurance policy shall name the Company as beneficiary and shall
provide that such policy may not be canceled unless the insurance carrier gives
at least 30 days prior written notice of such cancellation to the Company's
Board of Directors.

         2G. SECURITIES LAW COMPLIANCE. The Company shall have made all filings
under all applicable federal and state securities laws necessary to consummate
the issuance of the Series B Preferred pursuant to this Agreement in compliance
with such laws.

         2H. OPINION OF THE COMPANY'S COUNSEL. Each Purchaser shall have
received from counsel for the Company, an opinion with respect to the matters
set forth in EXHIBIT D attached hereto, which shall be addressed to each
Purchaser, dated the date of the Closing.

         2I. CLOSING DOCUMENTS. The Company shall have delivered to each
Purchaser all of the following documents:

             i. a certificate signed by the Company's President or chief
        financial officer, dated the date of the Closing, stating that the
        conditions specified in SECTION 1 and SECTIONS 2A through 2H, inclusive,
        have been fully satisfied;

             ii. certified copies of (a) the resolutions duly adopted by the
        Company's board of directors authorizing the execution, delivery and
        performance of this Agreement, the Registration Agreement, the
        Stockholders Agreement and each of the other agreements contemplated
        hereby, the filing of the amendment to the Certificate of Incorporation
        referred to in SECTION 2B, the issuance and sale of the Series B
        Preferred, the reservation for issuance upon conversion of the Series B
        Preferred shares of Common Stock and the consummation of all other
        transactions contemplated by this Agreement, and (b) the resolutions
        duly adopted by the Company's stockholders adopting the Certificate of
        Amendment of Certificate of Incorporation referred to in SECTION 2B;

             iii. certified copies of the Certificate of Incorporation referred
        to in SECTION 2B and the Company's amended bylaws, each as in effect at
        the Closing;

             iv. copies of all third party and governmental consents, approvals
        and filings required in connection with the consummation of the
        transactions hereunder (including, without limitation, all blue sky law
        filings and waivers of all preemptive rights and rights of first
        refusal);

                                       3
<PAGE>

             v. for the Purchasers that are SBICs, duly completed and executed
        SBA Forms 480, 652 and 1031 (Part A) and a written statement from the
        Company regarding its intended use of proceeds from the financing; and
        a list after giving effect to the transactions contemplated by this
        Agreement of (a) the name of each of the Company's directors, (b) the
        name and title of each of the Company's officers and (c) the name of
        each of the Company's stockholders setting forth the number and Series
        of shares held; and

             vi. such other documents relating to the transactions contemplated
        by this Agreement as the Purchasers' special counsel may reasonably
        request.

         2J. PROCEEDINGS. All corporate and other proceedings taken or required
to be taken by the Company in connection with the transactions contemplated
hereby to be consummated at or prior to the Closing and all documents incident
thereto shall be reasonably satisfactory in form and substance to Purchasers'
special counsel.

         2K. WAIVER. Any condition specified in this SECTION 2 may be waived if
consented to by a Purchaser; provided that no such waiver shall be effective
against any Purchaser unless it is set forth in a writing executed by such
Purchaser.

         2L. EXPENSES. At the Closing, the Company shall have reimbursed the
Purchasers for the fees and expenses of their special counsel as provided in
SECTION 7B hereof.

         2M. COMPLIANCE WITH APPLICABLE LAWS. The purchase of Series B Preferred
by each Purchaser hereunder shall not be prohibited by any applicable law or
governmental rule or regulation and shall not subject such Purchaser to any
penalty, liability or, in such Purchaser's sole judgment, other onerous
commercially unreasonable condition under or pursuant to any applicable law or
governmental rule or regulation, and the purchase of the Series B Preferred by
each Purchaser hereunder shall be permitted by laws, rules and regulations of
the jurisdictions and governmental authorities and agencies to which such
Purchaser is subject.

         SECTION 3. COVENANTS.

         3A. FINANCIAL STATEMENTS AND OTHER INFORMATION. The Company shall
deliver to each Purchaser (so long as such Purchaser owns not less than 10% the
Underlying Common Stock owned by such Purchaser immediately after the Closing at
which such Purchaser purchased Series B Preferred, subject to adjustment for
stock splits, stock dividends, recapitalizations and similar events):

             i. as soon as available but in any event within 30 days after the
        end of each monthly accounting period in each fiscal year, unaudited
        consolidating and consolidated statements of income and cash flows of
        the Company and its Subsidiaries for such monthly

                                       4
<PAGE>

        period and for the period from the beginning of the fiscal year to the
        end of such month, and unaudited consolidating and consolidated balance
        sheets of the Company and its Subsidiaries as of the end of such monthly
        period, setting forth in each case comparisons to the Company's annual
        budget and to the corresponding period in the preceding fiscal year, and
        all such statements shall be prepared in accordance with generally
        accepted accounting principles, consistently applied, subject to the
        absence of footnote disclosures and to normal year-end adjustments for
        recurring accruals, and shall be certified by the Company's chief
        financial officer;

             ii. within 45 days after the end of each quarterly accounting
        period in each fiscal year, an Officer's Certificate stating that the
        Company is not aware of any Event of Noncompliance in existence or, if
        any Event of Noncompliance exists, specifying the nature and period of
        existence thereof and what actions the Company and its Subsidiaries have
        taken and propose to take with respect thereto;

             iii. within 120 days after the end of each fiscal year,
        consolidating and consolidated statements of income and cash flows of
        the Company and its Subsidiaries for such fiscal year, and consolidating
        and consolidated balance sheets of the Company and its Subsidiaries as
        of the end of such fiscal year, setting forth in each case comparisons
        to the Company's annual budget and to the preceding fiscal year, all
        prepared in accordance with generally accepted accounting principles,
        consistently applied, and accompanied by (a) with respect to the
        consolidated portions of such statements, an opinion of an independent
        accounting firm of recognized national standing;

             iv. prior to the beginning of each fiscal year, an annual budget
        prepared on a monthly basis for the Company and its Subsidiaries for
        such fiscal year (displaying anticipated statements of income and cash
        flows and balance sheets), and promptly upon preparation thereof any
        other significant budgets prepared by the Company and any revisions of
        such annual or other budgets;

             v. promptly (but in any event within five business days) after the
        discovery of receipt of notice of any Event of Noncompliance, an
        Officer's Certificate specifying the nature and period of existence
        thereof and what actions the Company and its Subsidiaries have taken and
        propose to take with respect thereto;

             vi. within ten days after transmission thereof, copies of all
        financial statements, proxy statements, reports and any other general
        written communications which the Company sends to its stockholders
        generally and copies of all registration statements and all regular,
        special or periodic reports which it files, or any of its officers or
        directors file with respect to the Company, with the Securities and
        Exchange Commission or with any securities exchange on which any of its
        securities are then listed, and copies of all press releases and other
        statements made available generally by the Company to the public
        concerning material developments in the Company's and its Subsidiaries'
        businesses; and

                                       5
<PAGE>

             vii. with reasonable promptness, such other information and
        financial data concerning the Company and its Subsidiaries as any Person
        entitled to receive information under this SECTION 3A may reasonably
        request.

Each of the financial statements and related documents referred to in
subparagraph (i) through (iii) shall be true and correct in all material
respects as of the dates and for the periods stated therein, subject in the case
of the unaudited financial statements to changes resulting from normal year-end
adjustments.

Notwithstanding the foregoing, the provisions of this SECTION 3A shall cease to
be effective so long as the Company (a) is subject to the periodic reporting
requirements of the Securities Exchange Act and continues to comply with such
requirements and (b) promptly provides to each Person otherwise entitled to
receive information pursuant to this SECTION 3A all reports and other materials
filed by the Company with the Securities and Exchange Commission pursuant to the
periodic reporting requirements of the Securities Exchange Act; provided that so
long as 10% of the Series B Preferred remains outstanding the Company shall
continue to deliver to each Purchaser the information specified in SECTIONS
3A(ii), 3A(iii) and 3A(v).

For purposes of SECTIONS 3A, 3B and 3C hereof, the term "PURCHASER" shall
include any direct or indirect partner or equity investor in a Purchaser who
received shares of Series B Preferred or Underlying Common Stock pursuant to a
distribution from or a liquidation of such Purchaser.

         3B. INSPECTION OF PROPERTY. The Company shall permit any
representatives designated by any Purchaser (so long as such Purchaser holds any
at least 10% of the Underlying Common Stock acquired by such Purchaser at
Closing, subject to adjustment for stock splits, stock dividends,
recapitalizations and similar events) upon reasonable notice and during normal
business hours and at such other times as any such holder may reasonably
request, to (i) visit and inspect any of the properties of the Company and its
Subsidiaries, (ii) examine the corporate and financial records of the Company
and its Subsidiaries and make copies thereof or extracts therefrom and (iii)
discuss the affairs, finances and accounts of any such corporations with the
directors, officers, key employees and independent accountants of the Company
and its Subsidiaries. The presentation of an executed copy of this Agreement by
any Purchaser or any holder of Underlying Common Stock to the Company's
independent accountants shall constitute the Company's permission to its
independent accountants to participate in discussions with such Persons.

         3C. RESTRICTIONS. The Company shall not, without the prior written
consent of the holders of a majority of the Underlying Common Stock then
outstanding:

             i. pay any dividend or make any other distribution to the holders
        of Common Stock;

             ii. acquire all or substantially all of the assets of, or acquire a
        controlling equity interest in, any other person or business entity;

                                       6
<PAGE>

             iii. directly or indirectly redeem, purchase or otherwise acquire,
        or permit any Subsidiary to redeem, purchase or otherwise acquire, any
        of the Company's or any Subsidiary's capital stock or other equity
        securities (including, without limitation, warrants, options and other
        rights to acquire such capital stock or other equity securities) other
        than the Series A Preferred or Series B Preferred pursuant to the terms
        of the Amended and Restated Certificate of Incorporation or directly or
        indirectly redeem, purchase or make any payments with respect to any
        stock appreciation rights, phantom stock plans or similar rights or
        plans, except for repurchases of Common Stock from employees, directors,
        officers, consultants and advisors of the Company and its Subsidiaries
        upon the termination of employment, retention, or disability of such an
        individual pursuant to arrangements approved by the Company's Board of
        Directors;

             iv. except as expressly contemplated by this Agreement, authorize,
        issue or enter into any agreement providing for the issuance (contingent
        or otherwise) of (a) any notes or debt securities containing equity
        features (including, without limitation, any notes or debt securities
        convertible into or exchangeable for capital stock or other equity
        securities, issued in connection with the issuance of capital stock or
        other equity securities or containing profit participation features),
        that are senior to or pari passu with the Series B Preferred with
        respect to the payment of dividends, redemptions or distributions upon
        liquidation or otherwise; or (b) any capital stock or Equity
        Equivalents, in either case which are senior to or pari passu with the
        Series B Preferred with respect to the payment of dividends, redemptions
        or distributions upon liquidation or otherwise or any shares of phantom
        stock, stock appreciation rights or any similar instruments; or (c) any
        other capital stock or equity securities (or any other securities
        convertible into or exchangeable for any capital stock or other equity
        securities), whether or not subordinated to the Series B Preferred,
        other than as permitted under SECTION 3C(xv) or SECTION 3C(xvi) herein.

             v. make, or permit any Subsidiary to make, any loans or advances
        to, guarantees for the benefit of, or Investments in, any Person (other
        than a Wholly-Owned Subsidiary established under the laws of a
        jurisdiction of the United States or any of its territorial
        possessions), except for (a) reasonable advances to employees in the
        ordinary course of business, and (b) Investments having a stated
        maturity no greater than one year from the date the Company makes such
        Investment in (1) obligations of the United States government or any
        agency thereof or obligations guaranteed by the United States
        government, (2) certificates of deposit of commercial banks having
        combined capital and surplus of at least $50 million or (3) commercial
        paper with a rating of at least "PRIME-1" by Moody's Investors
        Service, Inc.;

             vi. merge or consolidate with any Person which results in the
        Company's stockholders as of immediately prior to such merger or
        consolidation (and without regard to any stockholders that acquired
        shares in connection therewith or in contemplation thereof) owning less
        than 50% of the merged entity by vote or permit any Subsidiary to merge
        or consolidate with any Person (other than a Wholly Owned Subsidiary);

                                       7
<PAGE>

             vii. sell, lease, pledge or otherwise dispose of, or permit any
        Subsidiary to sell, lease or otherwise dispose of, more than fifty
        percent (50%) of the consolidated assets of the Company and its
        Subsidiaries (computed on the basis of book value, determined in
        accordance with generally accepted accounting principles consistently
        applied, or fair market value, determined by the Company's board of
        directors in its reasonable good faith judgment) in any transaction or
        series of related transactions (other than sales of inventory in the
        ordinary course of business);

             viii. liquidate, dissolve or effect a recapitalization or
        reorganization in any form of transaction (including, without
        limitation, any reorganization into a limited liability company, a
        partnership or any other non-corporate entity which is treated as a
        partnership for federal income tax purposes);

             ix. become subject to, or permit any of its Subsidiaries to become
        subject to (including, without limitation, by way of amendment to or
        modification of) any agreement or instrument which by its terms would
        (under any circumstances) restrict the Company's right to perform the
        provisions of this Agreement, the Registration Agreement, the
        Stockholders Agreement, the Amended and Restated Certificate of
        Incorporation or the Company's bylaws (including, without limitation,
        provisions relating to the declaration and payment of dividends on and
        the making of redemptions of the Series B Preferred, and conversions of
        the Series B Preferred);

             x. except as expressly contemplated by this Agreement, make any
        amendment to the Certificate of Incorporation, as amended;

             xi. create, incur, assume or suffer to exist, or permit any
        Subsidiary to create, incur, assume or suffer to exist, Indebtedness in
        excess of $3,000,000 in the aggregate;

             xii. change the authorized size of its board of directors from
        eight (8) members;

             xiii. issue or sell any shares of the capital stock, or rights to
        acquire shares of the capital stock, of any Subsidiary to any Person
        other than the Company or a Wholly Owned Subsidiary;

             xiv. register any shares of Common Stock pursuant to a public
        offering not constituting a Qualified Public Offering (as defined in the
        Company's Amended and Restated Certificate of Incorporation), or
        register any Subsidiary's equity;

             xv. issue or grant under the Company's stock incentive plan, stock
        option plan, stock purchase plan, restricted stock plan, stock bonus
        arrangement or other similar stock plan or agreement approved by the
        Company's Board of Directors any option, warrant, Common Stock (other
        than Common Stock sold by the Company prior to the date of this

                                       8
<PAGE>

        Agreement for full fair market value in an arms-length transaction) or
        Equity Equivalent to any employee, officer, director, consultant or
        advisor unless such issuance or grant: (i) provides cliff vesting after
        one year (25%), with the remaining portion vested on a straight line
        monthly basis over at least an additional three year period; (ii)
        provides a right of first refusal in favor of the Company to repurchase
        any Common Stock or Equity Equivalents derived from such issuance or
        grant at a bona fide third party offer price; and (iii) restricts the
        transfer and sale of such option, warrant, Common Stock or Equity
        Equivalent (including any securities derived therefrom) for a period of
        180 days following any initial public offering of the Company's equity
        securities, as may be required by Company's underwriters; or

             xvi. issue or grant to any employee, officer, director, consultant
        or advisor under the Company's stock incentive plan, stock option plan,
        stock purchase plan, restricted stock plan, stock bonus arrangement or
        other similar stock plan or agreement approved by the Company's Board of
        Directors any options, warrants, Common Stock (other than Common Stock
        sold by the Company prior to the date of this Agreement for full fair
        market value in an arms-length transaction) or Equity Equivalents that
        in the aggregate with all pre-existing options, warrants, Common Stock
        and Equivalents issued or granted at any time under such plans and
        agreements exceed 20% of the Company's issued and outstanding Common
        Stock (including any issued and outstanding convertible securities, on
        an as-if converted basis).

         3D. AFFIRMATIVE COVENANTS. The Company shall, and shall cause each
Subsidiary to, unless it has received the prior written consent of the holders
of a majority of the outstanding Underlying Common Stock:

             i. at all times cause to be done all things necessary to maintain,
        preserve and renew its corporate existence and all material licenses,
        authorizations and permits that the Company believes, in its reasonable
        discretion, necessary to the conduct of its businesses;

             ii. maintain and keep its properties in good repair, working order
        and condition, and from time to time make all repairs, renewals and
        replacements that the Company believes, in its reasonable discretion, to
        be necessary or desirable so that its businesses may be property and
        advantageously conducted at all times;

             iii. pay and discharge when due and payable all taxes, assessments
        and governmental charges imposed upon its properties or upon the income
        or profits therefrom (in each case before the same becomes delinquent
        and before penalties accrue thereon) and all claims for labor, materials
        or supplies which if unpaid would by law become a Lien upon any of its
        property and would reasonably be expected to have a material adverse
        effect upon the financial condition, operating results, assets,
        operations or business prospects of the Company and its Subsidiaries
        taken as a whole, unless and to the extent that the same are being
        contested in good faith and by appropriate proceedings and adequate
        reserves (as determined in accordance with generally accepted
        accounting principles, consistently applied) have been established
        on its books with respect thereto;

                                       9
<PAGE>

             iv. comply in all material respects with all other obligations
        which it incurs pursuant to any contract or agreement, whether oral or
        written, express or implied, as such obligations become due to the
        extent to which the failure to so comply would reasonably be expected to
        have a material adverse effect upon the financial condition, operating
        results, assets, operations or business prospects of the Company and its
        Subsidiaries taken as a whole, unless and to the extent that the same
        are being contested in good faith and by appropriate proceedings and
        adequate reserves (as determined in accordance with generally accepted
        accounting principles, consistently applied) have been established on
        its books with respect thereto or unless determined otherwise by vote of
        the Board of Directors;

             v. comply in all material respects with all applicable laws, rules
        and regulations of all governmental authorities, the violation of which
        would reasonably be expected to have a material adverse effect upon the
        financial condition, operating results, assets, operations or business
        prospects of the Company and its Subsidiaries taken as a whole;

             vi. apply for and continue in force with good and responsible
        insurance companies adequate insurance covering risks of such types and
        in such amounts as are commercially reasonable for corporations of
        similar size engaged in similar lines of business as determined by the
        Board of Directors of the Company in its reasonable discretion;

             vii. maintain the key-man life insurance policies referred to in
        SECTION 2F hereof and maintain officers and directors liability
        insurance coverage of at least $2,000,000;

             viii. maintain proper books of record and account which present
        fairly in all material respects its financial condition and results of
        operations and make provisions on its financial statements for all such
        proper reserves as in each case are required in accordance with
        generally accepted accounting principles, consistently applied; and

             ix. enter into and maintain nondisclosure, proprietary rights and
        noncompete agreements with its key employees in accordance with the
        Company's past practices.

         3E. COMPLIANCE WITH AGREEMENTS. The Company shall perform and observe
in all material respects (i) all of its obligations to each holder of the Series
B Preferred and all of its obligations to each holder of the Underlying Common
Stock set forth in the Certificate of Amendment of Certificate of Incorporation
and the Company's bylaws, (ii) all of its obligations to each holder of
Registrable Securities set forth in the Registration Agreement, and (iii) all of
its obligations to each party under the Stockholders Agreement.

                                       10
<PAGE>

         3F. CURRENT PUBLIC INFORMATION. At all times after the Company has
filed a registration statement with the Securities and Exchange Commission
pursuant to the requirements of either the Securities Act or the Securities
Exchange Act, the Company shall use its best efforts to file all reports
required to be filed by it under the Securities Act and the Securities Exchange
Act and the rules and regulations adopted by the Securities and Exchange
Commission thereunder and shall take such further action as any holder or
holders of Restricted Securities may reasonably request, all to the extent
required to enable such holders to sell Restricted Securities pursuant to (i)
Rule 144 adopted by the Securities and Exchange Commission under the Securities
Act (as such rule may be amended from time to time) or any similar rule or
regulation hereafter adopted by the Securities and Exchange Commission or (ii) a
registration statement on Form S-2 or S-3 or any registration form hereafter
adopted by the Securities and Exchange Commission that replaces such Form S-2 or
S-3. Upon request, the Company shall deliver to any holder of Restricted
Securities a written statement as to whether it has complied with such
requirements.

         3G. SBIC REGULATORY PROVISIONS.

             i. Within 75 days after the Closing and each subsequent Financing
        hereunder by each holder of Series B Preferred or Underlying Common
        Stock which is an SBIC (an "SBIC HOLDER") and at the end of each quarter
        thereafter until all of the proceeds from the Financing hereunder have
        been used by the Company and its Subsidiaries, the Company shall deliver
        to each SBIC Holder a written statement certified by the Company's
        president or chief financial officer describing in reasonable detail the
        use of the proceeds of the Financing hereunder by the Company and its
        Subsidiaries. In addition to any other rights granted hereunder, the
        Company shall grant each SBIC Holder and the United States Small
        Business Administration (the "SBA") access to the Company's records for
        the purpose of verifying the use of such proceeds.

             ii. Promptly after the end of each fiscal year (but in any event
        prior to February 28 of each year), the Company shall deliver to each
        SBIC Holder a written assessment of the economic impact of the SBIC
        Holder's investment in the Company, specifying the full-time equivalent
        jobs created or retained in connection with the investment, the impact
        of the investment on the businesses of the Company in terms of expanded
        revenue and taxes and other economic benefits resulting from the
        investment (including, but not limited to, technology development or
        commercialization, minority business development, urban or rural
        business development and expansion of exports).

             iii. For purposes of this Section, the term "FINANCING" shall have
        the meaning set forth in the SBIC Regulations.

         3H. RESERVATION OF COMMON STOCK. The Company shall at all times reserve
and keep available out of its authorized but unissued shares of Common Stock,
solely for the purpose of issuance upon the conversion of the Series B
Preferred, a number of shares of Common Stock equal to the number of shares
thereof which are issuable upon conversion of all outstanding Series B
Preferred. All shares of Common Stock which are so issuable shall, when issued
pursuant to the

                                       11
<PAGE>

terms of and for the consideration contemplated by this Agreement, be duly and
validly issued, fully paid and nonassessable and free from all taxes, liens and
charges. The Company shall take all such actions as may be necessary to assure
that all such shares of Common Stock may be so issued without violation of any
applicable law or governmental regulation or any requirements of any domestic
securities exchange upon which shares of Common Stock may be listed (except for
official notice of issuance which shall be immediately transmitted by the
Company upon issuance).

         3I. INTELLECTUAL PROPERTY RIGHTS. The Company shall, and shall cause
each Subsidiary to, possess and maintain all Intellectual Property Rights
material to the conduct of their respective businesses as the Company shall
determine in its reasonable discretion, and own all right, title and interest in
and to, or have a valid license for, all such Intellectual Property Rights.
Neither the Company nor any Subsidiary shall take any action, or fail to take
any action, that would result in the invalidity, abandonment, misuse or
unenforceability of such Intellectual Property Rights or which would infringe
upon or misappropriate any rights of other Persons.

         3J. FIRST REFUSAL RIGHTS. If the Company authorizes the issuance or
sale of any shares of Common Stock or Equity Equivalents, the Company shall
first offer to sell to each holder of Underlying Common Stock a portion of such
stock or Equity Equivalents equal to the quotient determined by dividing (1) the
number of shares of Underlying Common Stock held by such holder immediately
prior to such issuance by (2) the sum of the total number of shares of
Underlying Common Stock immediately prior to such issuance and the number of
shares of Common Stock outstanding (including Common Stock reserved for
Preferred Stock, Series I Preferred Stock, Series II Preferred Stock and Series
III Preferred Stock) immediately prior to such issuance which are not shares of
Underlying Common Stock; provided, however, that the following issuances shall
be exempted from the Company's obligation to offer shares to such holder: (a)
issuance of Common Stock, options or Equity Equivalents to the Company's
employees, directors, officers, advisors and consultants to the extent
permissible under SECTIONS 3C(xv) and 3C(xvi), (b) issuance of Common Stock upon
the conversion of any Preferred Stock or upon the conversion of any other
presently outstanding convertible debt or other convertible securities of the
Company, (c) issuance of capital stock upon the exercise of any presently
outstanding warrants, (d) issuance of up to an additional 196,774 shares of
Common Stock to Cambridge Technology Partners, (e) issuance of up to 38,382
shares of Common Stock to Benjamin Weissberg and Jonathan Leitersdorf pursuant
to the Agreement dated June 30, 1997 between the corporation and them, (f)
issuance of up to 15,000 shares of Common Stock to Gustin Partners pursuant to
an oral agreement between Gustin Partners and the corporation, and (g) issuance
of up to 15,000 shares of Common Stock to strategic partners of the Company, (h)
issuance by way of a dividend or other distribution on shares of Preferred Stock
in accordance with the Amended and Restated Certificate of Incorporation, (i)
securities offered to the public pursuant to a registration statement filed
pursuant to the Securities Act, (j) sale of the Subsequent Shares pursuant to
this Agreement, and (k) the issuance of Common Stock or Equity Equivalents in
exchange for the capital stock of a third party in an arms length acquisition
transaction. Each holder of Underlying Common Stock shall be entitled to
purchase such stock or securities at the most favorable price and on the most
favorable terms as such stock or securities are to be offered to any other
Person. The purchase price for all stock and securities offered to the holders
of the Underlying Common Stock shall be payable on terms no less favorable to
such holders

                                       12
<PAGE>

than those offered to any other Person. The right of first refusal set forth in
this SECTION 3J is nonassignable, except that (I) such right is assignable in
connection with the transfer of the Series A Preferred or Series B Preferred
shares to any wholly-owned subsidiary or parent of, or to any corporation or
entity which is, within the meaning of the Securities Act, controlling,
controlled by or under common control with the holder of such Series B
Preferred, and (ii) such right is assignable in connection with the transfer of
Series B Preferred shares to the partners of the holder of such shares; provided
that the right of first refusal granted hereunder may not be assigned unless (A)
the transferee has certified to the Company that he or it is an "accredited
investor" within the meaning of Rule 501(a) under the Securities Act, (B) the
Company is given written notice by the transferee at the time of such transfer
stating the name and address of the transferee and identifying the securities
with respect to which such rights are being assigned, and (C) the transferee has
delivered to the Company a written instrument by which such transferee agrees to
be bound by the obligations imposed under this SECTION 3J to the same extent as
if such transferee were a party hereto.

             i. In order to exercise its purchase rights hereunder, a holder of
        Underlying Common Stock must within twenty (20) days after receipt of
        written notice from the Company describing in reasonable detail the
        stock or securities being offered, the purchase price thereof, the
        payment terms and such holder's percentage allotment deliver a written
        notice to the Company describing its election hereunder. If all of the
        stock and securities offered to the holders of Underlying Common Stock
        is not fully subscribed by such holders, the remaining stock and
        securities shall be reoffered by the Company to the holders purchasing
        their full allotment upon the terms set forth in this Section, except
        that such holders must exercise their purchase rights within five days
        after receipt of such reoffer.

             ii. Upon the expiration of the offering periods described above,
        the Company shall be entitled to sell such stock or securities which the
        holders of Underlying Common Stock have not elected to purchase during
        the ninety (90) days following such expiration on terms and conditions
        no more favorable to the purchasers thereof than those offered to such
        holders. Any stock or securities offered or sold by the Company after
        such 90-day period must be reoffered to the holders of Underlying Common
        Stock pursuant to the terms of this Section.

         3K. REGULATORY COMPLIANCE COOPERATION. In the event that any Purchaser
determines that it has a Regulatory Problem (as defined below), such Purchaser
shall have the right to transfer (subject to compliance with applicable
securities laws and regulations) its Preferred Stock without regard to any
restrictions on transfer set forth in this Agreement or the Stockholders
Agreement (provided that the transferee agrees in writing to become a party to
this Agreement), and the Company shall take all such actions as are reasonably
requested by such Purchaser in order to (a) effectuate and facilitate any
transfer by such Purchaser of any securities of the Company then held by such
Purchaser to any Person designated by such Purchaser, (b) permit such Purchaser
(or any Affiliate of such Purchaser) to exchange all or any portion of the
Preferred Stock then held by such Purchaser on a share-for-share basis for
shares of a class of nonvoting preferred stock of the Company, which nonvoting
preferred stock shall be identical in all respects to such Preferred Stock,
except that such preferred stock shall be nonvoting and shall be convertible, at
such Purchaser's sole

                                       13
<PAGE>

discretion, into either Common Stock or the non-voting Common Stock described in
clause (c), below, on such terms as are requested by such Purchaser in light of
regulatory considerations then prevailing, (c) permit such Purchaser (or any
Affiliate of such Purchaser) to exchange all or any portion of the Common Stock
then held by such Purchaser on a share-for-share basis for shares of a class of
nonvoting common stock of the Company, which nonvoting common stock shall be
identical in all respects to such Common Stock, except that such common stock
shall be nonvoting and shall be convertible into Common Stock on such terms as
are requested by such Purchaser in light of regulatory considerations then
prevailing and (d) amend this Agreement, the Articles of Incorporation and other
related agreements to effectuate and reflect the foregoing. Such actions may
include, but shall not necessarily be limited to:

             i. entering into such additional agreements as are requested by
        such Purchaser to permit any Person(s) designated by such Purchaser to
        exercise any voting power which is relinquished by such Purchaser upon
        any exchange of Common Stock for nonvoting stock of the Company; and

             ii. entering into such additional agreements, adopting such
        amendments to the Articles of Incorporation and bylaws of the Company
        and taking such additional actions as are reasonably requested by such
        Purchaser in order to effectuate the intent of the foregoing.

         For purposes of this Agreement, a "REGULATORY PROBLEM" means any set of
facts or circumstances wherein it has been asserted by any governmental
regulatory agency (or such Purchaser believes that there is a substantial risk
of such assertion) that such Purchaser and its Affiliates are not entitled to
hold, or exercise any significant right with respect to, the Preferred Stock or
the Common Stock.

         3L. PUBLIC DISCLOSURES. The Company shall not, nor shall it permit any
Subsidiary to, disclose any Purchaser's name or identity as an investor in the
Company in any press release or other public announcement or in any document or
material filed with any governmental entity, without the prior written consent
of such Purchaser, unless such disclosure is required by applicable law or
governmental regulations or by order of a court of competent jurisdiction, in
which case prior to such disclosure Company shall provide to such Purchaser in
reasonable detail the proposed content of such disclosure and shall permit the
Purchaser to review and comment upon the form and substance of such disclosure.

         3M. TERMINATION OF COVENANTS. The covenants of the Company contained in
this SECTION 3 shall terminate upon consummation by the Company of a Qualified
Public Offering (as defined in the Company's Amended and Restated Certificate of
Incorporation) provided, however, that the covenants contained in SECTIONS 3A
(to the extend specified therein), 3E, 3G and 3K shall survive with respect to a
Purchaser for so long as such Purchaser continues to own any Underlying Common
Stock, and the covenants contained in SECTION 3H shall survive with respect to a
Purchaser for so long as such Purchaser continues to own any Preferred Stock
purchased pursuant to this Agreement.

                                       14
<PAGE>

         3N. OTHER COVENANTS SUPERCEDED. The covenants set forth in this SECTION
3 shall supercede (as of the First Closing) all of the Company's covenants set
forth Section 7 of the Purchase Agreement between the Company and HarbourVest
Venture Partners V - Direct Fund L.P. dated January 21, 1998, which covenants
shall be terminated as of the date hereof, and HVP as the Purchaser thereunder
shall have all the rights with respect to its Series A Preferred Stock as are
set forth in this SECTION 3.

         SECTION 4. TRANSFER OF RESTRICTED SECURITIES.

         4A. REQUIREMENTS FOR TRANSFER.

             i. Restricted Securities shall not be sold or transferred unless
        either (a) they first shall have been registered under the Securities
        Act, or (b) the Company first shall have been furnished with an opinion
        of legal counsel, reasonably satisfactory to the Company, to the effect
        that such sale or transfer is exempt from the registration requirements
        of the Securities Act.

             ii. Notwithstanding the foregoing, no registration or opinion of
        counsel shall be required for (a) a transfer by a Purchaser that is a
        corporation to a Wholly-Owned Subsidiary of such corporation, a transfer
        by a Purchaser that is a partnership to a partner of such partnership or
        a retired partner of such partnership who retires after the date hereof,
        or to the estate of any such partner or retired partner, or a transfer
        by a Purchaser that is a limited liability company to a member of such
        limited liability company or a retired member who resigns after the date
        hereof or to the estate of any such member or retired member; provided
        that the transferee in each of the foregoing cases shall first agree in
        writing to be subject to the terms and conditions of this SECTION 4A to
        the same extent as if it were the original Purchaser hereunder, or (b)a
        transfer made in accordance with Rule 144 under the Securities Act.

         4B. LEGEND. Each certificate representing Restricted Securities shall
bear a legend substantially in the following form:

        "THE SHARES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED
        UNDER THE SECURITIES ACT OF 1933, AS AMENDED, AND MAY NOT BE OFFERED,
        SOLD OR OTHERWISE TRANSFERRED, PLEDGED OR HYPOTHECATED UNLESS AND
        UNTIL SUCH SHARES ARE REGISTERED UNDER THE ACT OR AN OPINION OF
        COUNSEL SATISFACTORY TO THE COMPANY IS OBTAINED TO THE EFFECT THAT
        SUCH REGISTRATION IS NOT REQUIRED."

                                       15
<PAGE>

         4C. LEGEND REMOVAL. If any Restricted Securities become eligible for
sale pursuant to Rule 144(k), the Company shall, upon the request of the holder
of such Restricted Securities, remove the legend set forth in SECTION 4B from
the certificates for such Restricted Securities.

         SECTION 5. REPRESENTATIONS AND WARRANTIES OF THE COMPANY.

         As a material inducement to the Purchasers to enter into this Agreement
and purchase the Series B Preferred hereunder, the Company hereby represents and
warrants that, except to the extent set forth on the Disclosure Schedules
attached hereto:

         5A. ORGANIZATION, CORPORATE POWER AND LICENSES. The Company is a
corporation duly organized, validly existing and in good standing under the laws
of Delaware and is qualified to do business in every jurisdiction in which its
ownership of property or conduct of business requires it to qualify and in which
the failure to so qualify would have a Material Adverse Effect. The Company
possesses all requisite corporate power and authority and all material licenses,
permits and authorizations necessary to own and operate its properties, to carry
on its businesses as now conducted and presently proposed to be conducted and to
carry out the transactions contemplated by this Agreement. The copies of the
Company's and each Subsidiary's charter documents and bylaws which have been
furnished to the Purchasers' special counsel reflect all amendments made thereto
at any time prior to the date of this Agreement and are correct and complete.

         5B. CAPITAL STOCK AND RELATED MATTERS.

             i. As of the Closing and immediately thereafter, the authorized
        capital stock of the Company shall consist of (a) 413,965 shares of
        Series I Preferred all of which shall be issued and outstanding, (b)
        336,021 shares of Series II Preferred all of which shall be issued and
        outstanding, (c) 215,000 shares of Series III Preferred of which 200,032
        shares shall be issued and outstanding, (d) 2,884,598 shares of Series A
        Preferred all of which shall be issued and outstanding, (e) 4,000,000
        shares of Series B Preferred of which [3,033,878] shall be issued and
        outstanding, and the remainder of which shall be reserved for future
        issuances of Series B Preferred, and (f) 15,000,000 shares of Common
        Stock, of which 4,097,171 shares shall be issued and outstanding,
        7,849,584 shares shall be reserved for issuance upon conversion of the
        Preferred Stock and 950,266 shares shall be reserved for issuance upon
        exercise of all other Equity Equivalents. All of the issued and
        outstanding shares of the Company's capital stock have been duly
        authorized, are validly issued, fully paid, and nonassessable, and are
        not subject to, nor were they issued in violation of, any preemptive
        rights or rights of first refusal. As of the First Closing, neither the
        Company nor any Subsidiary shall have outstanding any capital stock or
        Equity Equivalents, nor shall the Company or any Subsidiary have
        outstanding any rights or options to subscribe for or to purchase its
        capital stock or Equity Equivalents or any oral or written agreement
        related thereto, except for the Preferred Stock and except as set forth
        on the attached "CAPITALIZATION SCHEDULE." The CAPITALIZATION SCHEDULE
        accurately sets forth the following information with

                                       16
<PAGE>

        respect to all outstanding Capital Stock and Equity Equivalents: the
        holder thereof; the class of series and number of shares or Equity
        Equivalents owned; and in the case of Equity Equivalents, the class or
        series and number of shares of capital stock (or equivalent) obtainable
        upon exercise thereof, the exercise price (or equivalent) thereof, and
        the expiration date thereof. As of the First Closing, neither the
        Company nor any Subsidiary shall be subject to any obligation
        (contingent or otherwise) to repurchase or otherwise acquire or retire
        any shares of its capital stock or any Equity Equivalents, except as set
        forth on the CAPITALIZATION SCHEDULE and except pursuant to the
        Certificate of Incorporation.

             ii. There are no statutory or, to the best of the Company's
        knowledge, contractual stockholders preemptive rights, rights of refusal
        or first offer or similar rights, or anti-dilution rights with respect
        to the issuance of the Series B Preferred hereunder or the issuance of
        the Common Stock upon the conversion of the Preferred Stock that have
        not been waived prior to the First Closing. The Company has not violated
        any applicable U.S. federal or state corporate or securities laws in
        connection with the offer, sale or issuance of any of its capital stock,
        and, based on the representations of the Purchasers set forth in SECTION
        7D, the offer, sale and issuance of the Series B Preferred hereunder do
        not require registration under the Securities Act or any applicable
        state securities laws. To the best of the Company's knowledge, there are
        no agreements between the Company's stockholders with respect to the
        voting or transfer of the Company's capital stock or with respect to any
        other aspect of the Company's affairs, except as set forth on the
        CAPITALIZATION SCHEDULE.

         5C. SUBSIDIARIES; INVESTMENTS. The attached "SUBSIDIARY SCHEDULE"
correctly sets forth the name of each Subsidiary, the jurisdiction of its
incorporation and the Persons owning the outstanding capital stock of such
Subsidiary. Each Subsidiary is duly organized, validly existing and in good
standing under the laws of the jurisdiction of its incorporation to the extent
that such concepts exist in such jurisdictions, possesses all requisite
corporate power and authority and all material licenses, permits and
authorizations necessary to own its properties and to carry on its businesses as
now being conducted and as presently proposed to be conducted and is qualified
to do business in every jurisdiction in which its ownership of property or the
conduct of business requires it to qualify and in which the failure to be so
qualified would have a Material Adverse Effect. All of the outstanding shares of
capital stock of each Subsidiary are validly issued, full paid and
nonassessable, and all such shares are owned beneficially and of record by the
Company or another Subsidiary free and clear of any Lien and not subject to any
option or right to purchase any such shares. Except as set forth on the
SUBSIDIARY SCHEDULE, neither the Company nor any Subsidiary owns or holds the
right to acquire any shares of stock or any other security or interest in any
other Person (other than another Subsidiary).

         5D. AUTHORIZATION; NO BREACH. The execution, delivery and performance
of this Agreement, the Registration Agreement, the Stockholders Agreement and
all other agreements contemplated hereby to which the Company is a party, the
filing of the amendment of the Certificate of Incorporation (collectively, the
"RELEVANT DOCUMENTS") have been duly authorized by the Company. The Relevant
Documents to which the Company is a party each constitutes a valid and binding
obligation of the Company, enforceable in accordance with its terms. The
execution and

                                       17
<PAGE>

delivery by the Company of the Relevant Documents, the offering, sale and
issuance of the Series B Preferred hereunder, the issuance of the Common Stock
upon conversion of the Series B Preferred, the filing of the amendment of the
Certificate of Incorporation and the fulfillment of and compliance with the
respective terms hereof and thereof by the Company, do not and shall not (i)
conflict with or result in a breach of the terms, conditions or provisions of,
(ii) constitute a default under, (iii) result in the creation of any lien,
security interest, charge or encumbrance upon the Company's or any Subsidiary's
capital stock or assets pursuant to, (iv) give any third party the right to
modify, terminate or accelerate any obligation under, (v) result in a violation
of, or (vi) require any authorization, consent, approval, exemption or other
action by or notice or declaration to, or filing with, any court or
administrative or governmental body or agency pursuant to, or the charter or
bylaws of the Company or any Subsidiary, or any law, statute, rule or regulation
to which the Company or any Subsidiary is subject, or any agreement, instrument,
order, judgment or decree to which the Company or any Subsidiary is subject
(except for filings required under the Securities Act and state blue sky laws)
which event would have a Material Adverse Effect. Except as set forth on the
attached "RESTRICTIONS SCHEDULE," none of the Subsidiaries are subject to any
restrictions upon making loans or advances or paying dividends to, transferring
property to, or repaying any Indebtedness owed to, the Company or another
Subsidiary.

         5E. FINANCIAL STATEMENTS. Attached hereto as the "FINANCIAL STATEMENTS
SCHEDULE" are (x) the consolidated balance sheets of the Company and its
Subsidiaries as of December 31, 1997 and 1998, and the related statements of
income and cash flows (or the equivalent) for the respective twelve-month
periods then ended, and (y) the unaudited consolidated balance sheet of the
Company and its Subsidiaries as of December 31, 1999 (the "LATEST BALANCE
SHEET"), and the related statements of income and cash flows (or the equivalent)
for the 12-month period then ended. Each of the foregoing financial statements
(including in all cases the notes thereto, if any) is accurate and complete in
all material respects, is consistent with the books and records of the Company
(which, in turn, are accurate and complete in all material respects) and has
been prepared in accordance with generally accepted accounting principles,
consistently applied, subject in the case of the unaudited financial statements
to the absence of footnote disclosure and changes resulting from normal year-end
adjustments none of which would have a Material Adverse Effect.

         5F. ABSENCE OF UNDISCLOSED LIABILITIES. Except as set forth on the
attached "LIABILITIES SCHEDULE", to the Company's knowledge the Company and its
Subsidiaries do not have any material obligation or liability (whether accrued,
absolute, contingent, unliquidated or otherwise, whether due or to become due
and regardless of when asserted) arising out of transactions entered into at or
prior to the Closing, or any action or inaction at or prior to the Closing, or
any state of facts existing at or prior to the Closing other than: (i)
liabilities set forth on the Latest Balance Sheet (including any notes thereto),
(ii) liabilities and obligations which have arisen after the date of the Latest
Balance Sheet in the ordinary course of business (none of which is a liability
resulting from breach of contract, breach of warranty, tort, infringement, claim
or lawsuit), (iii) other liabilities and obligations expressly disclosed in the
other Schedules to this Agreement, and (iv) liabilities incurred in the ordinary
course of business that were not required to be disclosed on the latest balance
sheet of the Company or its Subsidiaries in accordance with GAAP.

                                       18
<PAGE>

         5G. NO MATERIAL ADVERSE CHANGE. Except as set forth on the attached
"ADVERSE CHANGE SCHEDULE", since the date of the Latest Balance Sheet, there has
been no material adverse change in the financial condition, operating results,
assets, operations, business prospects, employee relations or customer or
supplier relations of the Company and its Subsidiaries taken as a whole.

         5H. ABSENCE OF CERTAIN DEVELOPMENTS. Except as expressly contemplated
by this Agreement or as set forth on the attached "DEVELOPMENTS SCHEDULE", since
the date of the Latest Balance Sheet, neither the Company nor any Subsidiary
have

             i. issued any notes, bonds or other debt securities or any capital
        stock or other equity securities or any securities convertible,
        exchangeable or exercisable into any capital stock or other equity
        securities other than options under the Company's stock inventive plan
        and shares issued upon the exercise of such options;

             ii. discharged or satisfied any material Lien or paid any material
        obligation or liability, other than current liabilities paid in the
        ordinary course of business;

             iii. declared or made any payment or distribution of cash or other
        property to its stockholders with respect to its capital stock or other
        equity securities or purchased or redeemed any shares of its capital
        stock or other equity securities (including, without limitation, any
        warrants, options or other rights to acquire its capital stock or other
        equity securities), other than repurchases of stock from former
        employees, directors, officers, consultants and advisers pursuant to the
        terms of stock restriction agreements to which the Company is a party;

             iv. mortgaged or pledged any of its properties or assets or
        subjected them to any material Lien, except Liens for current property
        taxes not yet due and payable;

             v. sold, assigned or transferred any of its tangible assets, except
        in the ordinary course of business, or canceled any material debts or
        claims;

             vi. sold, assigned or transferred any patents or patent
        applications, trademarks, service marks, trade names, corporate names,
        copyrights or copyright registrations, trade secrets or other intangible
        assets, or disclosed any material proprietary confidential information
        to any Person other than newly hired employees of the Company other than
        pursuant to a confidentiality agreement;

             vii. suffered any material extraordinary losses or waived any
        rights of material value, whether or not in the ordinary course of
        business or consistent with past practice;

             viii. made capital expenditures or commitments therefor that
        individually are in excess of $50,000 or in the aggregate are in excess
        of $500,000.

                                       19
<PAGE>

             ix. made any loans or advances to, guarantees for the benefit of,
        or any Investments in, any Persons in excess of $10,000 in the aggregate
        other than advances to the Company's employees made in the ordinary
        course of the Company's business;

             x. suffered any damage, destruction or casualty loss exceeding in
        the aggregate $150,000, whether or not covered by insurance; or

             xi. made any Investment in or taken steps to incorporate any
        Subsidiary.

         Neither the Company nor any Subsidiary has at any time made any
payments for political contributions or made any bribes, kickback payments or
other illegal payments.

         5I. ASSETS. Except as set forth on the attached "ASSETS SCHEDULE," the
Company and each Subsidiary have good and marketable title to, or a valid
leasehold interest in, the properties and assets used by them, located on their
premises or shown on the Latest Balance Sheet or acquired thereafter, free and
clear of all Liens, except for properties and assets disposed of in the ordinary
course of business since the date of the Latest Balance Sheet and except for
Liens disclosed on the Latest Balance Sheet (including any notes thereto) and
Liens for current property taxes not yet due and payable. Except as described on
the ASSETS SCHEDULE, the Company's and each Subsidiary's buildings, equipment
and other tangible assets are in good operating condition in all material
respects and are fit for use in the ordinary course of business. The Company and
each Subsidiary own, or have a valid leasehold interest in, all assets necessary
for the conduct of their respective businesses as presently conducted and as
presently proposed to be conducted.

         5J. TAX MATTERS.

             i. Except as set forth on the attached "TAXES SCHEDULE": the
        Company, each Subsidiary and each Affiliated Group have filed all Tax
        Returns which they are required to file under applicable laws and
        regulations except to the extent that the failure to file would not have
        a Material Adverse Effect; all such Tax Returns are complete and correct
        in all material respects and have been prepared in compliance with all
        applicable laws and regulations in all material respects; the Company,
        each Subsidiary and to the Company`s knowledge each Affiliated Group in
        all material respects have paid all Taxes due and owing by them (whether
        or not such Taxes are required to be shown on a Tax Return) and have
        withheld and paid over to the appropriate taxing authority all Taxes
        which they are required to withhold from amounts paid or owing to any
        employee, stockholder, creditor or other third party; neither the
        Company, any Subsidiary nor any Affiliated Group has waived any statute
        of limitations with respect to any material Taxes or agreed to any
        extension of time with respect to any material Tax assessment or
        deficiency; the accrual for Taxes on the Latest Balance Sheet would be
        adequate to pay all Tax liabilities of the Company and its Subsidiaries
        if their current tax year were treated as ending on the date of the
        Latest Balance Sheet (excluding any amount recorded which is
        attributable solely to timing differences between book and Tax income);
        since the date of the Latest Balance Sheet, the Company and

                                       20
<PAGE>

        its Subsidiaries have not incurred any material liability for Taxes
        other than in the ordinary course of business; the assessment of any
        additional Taxes for periods for which Tax Returns have been filed by
        the Company, each Subsidiary and each Affiliated Group is not expected
        to exceed the recorded liability therefor on the Latest Balance Sheet in
        any material respect (excluding any amount recorded which is
        attributable solely to timing differences between book and Tax income);
        the federal income Tax Returns of the Company and its Subsidiaries have
        been audited and closed for all tax years through 1998; no foreign,
        federal, state or local tax audits or administrative or judicial
        proceedings are pending or being conducted with respect to the Company,
        any Subsidiary or any Affiliated Group, no information related to Tax
        matters has been requested by any foreign, federal, state or local
        taxing authority and no written notice indicating an intent to open an
        audit or other review has been received by the Company from any foreign,
        federal, state or local taxing authority; and to the Company's knowledge
        there are no material unresolved questions or claims concerning the
        Company's, any Subsidiary's or any Affiliated Group Tax liability.

             ii. Neither the Company nor any of its Subsidiaries has made an
        election under Section 341(f) of the Code. Neither the Company nor any
        Subsidiary is liable for the Taxes of another Person that is not a
        Subsidiary in a material amount under (a) Treas. Reg. Section 1.1502-6
        (or comparable provisions of state, local or foreign law), (b) as a
        transferee or successor, (c) by contract or indemnity or (d) otherwise.
        Neither the Company nor any Subsidiary is a party to any tax sharing
        agreement. The Company, each Subsidiary and each Affiliated Group have
        disclosed on their federal income Tax Returns any position taken for
        which substantial authority (within the meaning of IRC Section
        6662(d)(2)(B)(i)) did not exist at the time the return was filed.
        Neither the Company nor any Subsidiary has made any payments, is
        obligated to make payments or is a party to an agreement that could
        obligate it to make any payments that would not be deductible under IRC
        Section 280G.

             iii. "TAX" or "TAXES" means federal, state, county, local, foreign
        or other income, gross receipts, ad valorem, franchise, profits, sales
        or use, transfer, registration, excise, utility, environmental,
        communications, real or personal property, capital stock, license,
        payroll, wage or other withholding, employment, social security,
        severance, stamp, occupation, alternative or add-on minimum, estimated
        and other taxes of any kind whatsoever (including, without limitation,
        deficiencies, penalties, additions to tax, and interest attributable
        thereto) whether disputed or not. "TAX RETURN" means any return,
        information report or filing with respect to Taxes, including any
        schedules attached thereto and including any amendment thereof.
        "AFFILIATED GROUP" means any affiliated group as defined in IRC
        Section 1504 that has filed a consolidated return for federal income
        tax purposes (or any similar group under state, local or foreign law)
        for a period during which any of the Company or any of its
        Subsidiaries was a member.

                                       21

<PAGE>

         5K. CONTRACTS AND COMMITMENTS. Except as expressly contemplated by this
Agreement or as set forth on the attached "CONTRACTS SCHEDULE" or the attached
"EMPLOYEE BENEFITS SCHEDULE", neither the Company nor any Subsidiary is a party
to or bound by any written or oral:

             i. pension, profit sharing, stock option, employee stock purchase
        or other plan or arrangement providing for deferred or other
        compensation to employees or any other employee benefit plan or
        arrangement, or any collective bargaining agreement or any other
        contract with any labor union, or severance agreements, programs,
        policies or arrangements;

             ii. contract for the employment of any officer, individual employee
        or other Person on a full-time, part-time, consulting or other basis
        providing annual compensation in excess of $100,000 or contract relating
        to loans to officers, directors or Affiliates;

             iii. contract under which the Company or Subsidiary has advanced or
        loaned any other Person amounts in the aggregate exceeding $100,000;

             iv. agreement or indenture relating to borrowed money or other
        Indebtedness or the mortgaging, pledging or otherwise placing a Lien on
        any material asset or material group of assets of the Company and its
        Subsidiaries;

             v. guarantee of any obligation (other than by the Company of a
        Wholly-Owned Subsidiary's debts or a guarantee by a Subsidiary of the
        Company's debts or another Subsidiary's debts);

             vi. lease or agreement under which the Company or any Subsidiary is
        lessee of or holds or operates any property, real or personal, owned by
        any other party, except for any lease of real or personal property under
        which the aggregate annual rental payments do not exceed $15,000;

             vii. lease or agreement under which the Company or any Subsidiary
        is lessor of or permits any third party to hold or operate any property,
        real or personal, owned or controlled by the Company or any Subsidiary;

             viii. contract or group of related contracts with the same party or
        group of affiliated parties the performance of which involves
        consideration in excess of $100,000 in any 12-month period or that if
        terminated would be likely to have a Material Adverse Effect;

             ix. assignment, license, indemnification or agreement with respect
        to any intangible property (including, without limitation, any
        Intellectual Property) other than invention rights and confidentiality
        agreements entered into by the Company in the ordinary course of
        business to protect the Company's intellectual property;

             x. warranty agreement with respect to its services rendered or its
        products sold or leased;

                                       22
<PAGE>

             xi. agreement under which it has granted any Person any
        registration rights (including, without limitation, demand and piggyback
        registration rights);

             xii. agreement with a term of more than six months which is not
        terminable by the Company or any Subsidiary upon less than 90 days
        notice without penalty;

             xiii. contract or agreement prohibiting it from freely engaging in
        any business or competing anywhere in the world; or

             xiv. any other agreement which is material to its operations and
        business prospects or involves a consideration in excess of $100,000.

         All of the contracts, agreements and instruments set forth on the
CONTRACTS SCHEDULE are valid, binding and enforceable against the Company and
each other party thereto in accordance with the respective terms of such
contracts, agreements and instruments. The Company and each Subsidiary have
performed all material obligations required to be performed by them under the
contracts, agreements and instruments listed on the CONTRACTS SCHEDULE and are
not in default in any material respect under or in breach in any material
respect of nor in receipt of any claim of default or breach in any material
respect under any material contract, agreement or instrument listed on the
CONTRACTS SCHEDULE; to the Company's knowledge, no event has occurred which with
the passage of time or the giving of notice or both would result in a default,
breach or event of noncompliance in any material respect by the Company or any
Subsidiary under any material contract, agreement or instrument listed on the
CONTRACTS SCHEDULE; neither the Company nor any Subsidiary has any present
expectation or intention of not fully performing all such obligations; neither
the Company nor any Subsidiary has knowledge of any breach or anticipated breach
by the other parties to any material contract, agreement, instrument or
commitment to which the Company is a party.

         The Purchasers' special counsel has been supplied with a true and
correct copy of each of the written instruments, plans, contracts and agreements
and an accurate description of each of the oral arrangements, contracts and
agreements which are referred to on the CONTRACTS SCHEDULE, together with all
amendments, waivers or other changes thereto.

         5L. INTELLECTUAL PROPERTY RIGHTS.

             i. The attached "INTELLECTUAL PROPERTY SCHEDULE" contains a
        complete and accurate list of all (a) patented or registered
        Intellectual Property Rights owned or used by the Company or any
        Subsidiary, (b) pending patent applications and applications for
        registrations of other Intellectual Property Rights filed by the Company
        or any Subsidiary, (c) material unregistered trade names and corporate
        names owned or used by the Company or any Subsidiary and (d) material
        unregistered trademarks, service marks, copyrights, mask works owned or
        used by the Company or any Subsidiary. The INTELLECTUAL PROPERTY
        SCHEDULE also contains a complete and accurate list of all licenses and
        other rights granted by the Company or any Subsidiary to any third party
        with respect to any material Intellectual Property Rights and all
        licenses and other rights granted by any third party to the Company

                                       23
<PAGE>

        or any Subsidiary with respect to any material Intellectual Property
        Rights, in each case identifying the subject Intellectual Property
        Rights. Except as set forth on the INTELLECTUAL PROPERTY SCHEDULE, the
        Company or one of its Subsidiaries owns all right, title and interest
        to, or has the right to use pursuant to a valid license, all
        Intellectual Property Rights necessary for the operation of the
        businesses of the Company and its Subsidiaries as presently conducted
        (including without limitation all rights set forth on the Intellectual
        Property Schedule). No loss or expiration of any Intellectual Property
        Rights set forth on the Intellectual Property Schedule is, to the best
        of the Company's knowledge, threatened, pending or reasonably
        foreseeable other than any expiration of such rights in accordance with
        their terms that would not have a Material Adverse Effect. The Company
        and its Subsidiaries have taken all commercially reasonable actions to
        maintain and protect the Intellectual Property Rights that they own. To
        the best of the Company's knowledge, the owners of any Intellectual
        Property Rights licensed to the Company or any Subsidiary have taken all
        necessary and desirable actions to maintain and protect the Intellectual
        Property Rights which are subject to such licenses.

             ii. Except as set forth on the INTELLECTUAL PROPERTY SCHEDULE, (a)
        there have been no claims made against the Company or any Subsidiary
        asserting the invalidity, misuse or unenforceability of any of such
        Intellectual Property Rights, and the Company is not aware of any valid
        grounds for the same which are reasonably likely to result in such a
        claim being made, (b) neither the Company nor any Subsidiary has
        received any notices of, and is not aware of any facts which indicate a
        likelihood of, any infringement or misappropriation by, or conflict
        with, any third party with respect to such Intellectual Property Rights
        (including, without limitation, any demand or request that the Company
        or any Subsidiary license any rights from a third party), (c) the
        conduct of the Company's and each Subsidiary's business has not
        infringed, misappropriated or conflicted with and does not infringe,
        misappropriate or conflict with any Intellectual Property Rights of
        other Persons, nor would any future conduct as presently contemplated
        infringe, misappropriate or conflict in any material respect with any
        Intellectual Property Rights of other Persons and (d) to the best of the
        Company's knowledge, the material Intellectual Property Rights owned by
        or licensed to the Company or any Subsidiary have not been infringed,
        misappropriated or conflicted by other Persons. Except as set forth in
        the INTELLECTUAL PROPERTY SCHEDULE, the transactions contemplated by
        this Agreement shall have no material adverse effect on the Company's or
        any Subsidiary's right, title and interest in and to the Intellectual
        Property Rights listed on the INTELLECTUAL PROPERTY SCHEDULE.

         5M. LITIGATION, ETC. Except as set forth on the attached "LITIGATION
SCHEDULE", there are no actions, suits, proceedings, orders, investigations or
claims pending or, to the best of the Company's knowledge, threatened against
the Company or any Subsidiary (or to the best of the Company's knowledge,
pending or threatened against or affecting any of the officers, directors or
employees of the Company and its Subsidiaries with respect to their businesses
or proposed business activities), or pending or threatened by the Company or any
Subsidiary against any third party, at law or in equity, or before or by any
governmental department, commission, board, bureau, agency or instrumentality
(including, without limitation, any actions, suit, proceedings or investigations
with

                                       24
<PAGE>

respect to the transactions contemplated by this Agreement); nor has there been
any such actions, suits, proceeds, order, investigations or claims against or to
the Company's knowledge affecting the Company or any Subsidiary; neither the
Company nor any Subsidiary is subject to any arbitration proceedings under
collective bargaining agreements or otherwise or, to the best of the Company's
knowledge, any governmental investigations or inquiries; and the Company is not
aware of any valid grounds which are reasonably likely to result in any of the
foregoing. Neither the Company nor any Subsidiary is subject to any judgment,
order or decree of any court or other governmental agency, and neither the
Company nor any Subsidiary has received any opinion or memorandum or legal
advice from legal counsel to the effect that it is exposed, from a legal
standpoint, to any liability or disadvantage which may be material to its
business that would reasonably be expected to have, or be likely to have, a
Material Adverse Effect.

         5N. BROKERAGE. Except as set forth on the attached "BROKERAGE
SCHEDULE", there are no claims for brokerage commissions, finders' fees or
similar compensation in connection with the transactions contemplated by this
Agreement based on any arrangement or agreement binding upon the Company or any
Subsidiary. The Company shall pay, and hold each Purchaser harmless against, any
liability, loss or expense (including, without limitation, reasonable attorneys'
fees and out-of-pocket expenses) arising in connection with any such claim.

         5O. GOVERNMENTAL CONSENT, ETC. No permit, consent, approval or
authorization of, or declaration to or filing with, any governmental authority
is required in connection with the execution, delivery and performance by the
Company of this Agreement or the other agreements contemplated hereby, or the
consummation by the Company of any other transactions contemplated hereby or
thereby, except as set forth on the attached "CONSENTS SCHEDULE" and except as
expressly contemplated herein or in the exhibits hereto except for filings under
applicable securities laws.

         5P. INSURANCE. The attached "INSURANCE SCHEDULE" contains a description
of each insurance policy maintained by the Company and its Subsidiaries with
respect to its properties, assets and businesses, and each such policy is in
full force and effect as of the Closing. Neither the Company nor any Subsidiary
is in default in any material respect to its obligations under any insurance
policy maintained by it, and neither the Company nor any Subsidiary has been
denied insurance coverage. The insurance coverage of the Company and its
Subsidiaries is customary for corporations of similar size engaged in similar
lines of business. Except as set forth on the INSURANCE SCHEDULE, the Company
and its Subsidiaries do not have any self-insurance or co-insurance programs,
and the reserves set forth on the Latest Balance Sheet are adequate to cover all
anticipated liabilities with respect to any such self-insurance or co-insurance
programs.

         5Q. EMPLOYEES. The Company is not aware that any executive or key
employee of the Company or any Subsidiary or any group of employees of the
Company or any Subsidiary has any plans to terminate employment with the Company
or any Subsidiary. The Company and each Subsidiary have complied in all material
respects with all laws relating to the employment of labor (including, without
limitation, provisions thereof relating to wages, hours, equal opportunity,
collective bargaining and the payment of social security and other taxes), and
the Company is not aware that it or any Subsidiary has any material labor
relations problems (including, without

                                       25
<PAGE>

limitation, any union organization activities, threatened or actual strikes or
work stoppages or material grievances). Neither the Company, its Subsidiaries
nor, to the best of the Company's knowledge any of their employees is subject to
any noncompete, nondisclosure, confidentiality, employment, consulting or
similar agreements relating to, affecting or in conflict with the present or
proposed business activities of the Company and its Subsidiaries, except for
agreements between the Company and such employees.

         5R. ERISA.

             i. MULTIEMPLOYER PLANS. The Company does not have any obligation to
        contribute to (or any other liability, including current or potential
        withdrawal liability, with respect to) any "multiemployer plan" (as
        defined in Section 3(37) of the Employee Retirement Income Security Act
        of 1974, as amended ("ERISA")).

             ii. RETIREE WELFARE PLANS. The Company does not maintain or have
        any obligation to contribute to (or any other liability with respect to)
        any plan or arrangement whether or not terminated, which provides
        medical, health, life insurance or other welfare-type benefits for
        current or future retired or terminated employees (except for limited
        continued medical benefit coverage required to be provided under Section
        4980B of the IRC or as required under applicable state law).

             iii. DEFINED BENEFIT PLANS. The Company does not maintain,
        contribute to or have any liability under (or with respect to) any
        employee plan that is a tax-qualified "defined benefit plan" (as defined
        in Section 3(35) of ERISA), whether or not terminated.

             iv. DEFINED CONTRIBUTION PLANS. The Company does not maintain,
        contribute to or have any liability under (or with respect to) any
        employee plan that is a tax-qualified "defined contribution plan" (as
        defined in Section 3(34) of ERISA), whether or not terminated, other
        than the Company's qualified 401(k) salary deferral plan (the "PROFIT
        SHARING PLAN").

             v. OTHER PLANS. Except as set forth in the "EMPLOYEE BENEFITS
        SCHEDULE", the Company does not maintain, contribute to or have any
        liability under (or with respect to) any plan or arrangement providing
        benefits to current or former employees, including any bonus plan, plan
        for deferred compensation, employee health or other welfare benefit plan
        or other arrangement, whether or not terminated. Such plans and other
        arrangements are referred to as the "OTHER PLANS".

             vi. THE COMPANY. For purposes of this SECTION 5R, the term
        "COMPANY" includes all organizations under common control with the
        Company pursuant to Section 414(b) or (c) of the IRC.

             vii. PAYMENTS AND ACCRUALS. With respect to the Profit Sharing Plan
        and the Other Plans (the "PLANS"), all required or recommended (in
        accordance with historical

                                       26
<PAGE>

        practices) payments, premiums, contributions, reimbursements or accruals
        for all periods (or partial periods) ending prior to or as of the
        Closing shall have been made or properly accrued on the Latest Balance
        Sheet. None of the Plans has any material unfunded liabilities which are
        not reflected on the Latest Balance Sheet.

             viii. COMPLIANCE. The Plans and all related trusts, insurance
        contracts and funds have been maintained, funded and administered in
        compliance in all material respects with the applicable provisions of
        ERISA, the IRC and other applicable laws. Neither the Company nor any
        trustee or administrator of any Plan has engaged in any transaction with
        respect to the Plans which could subject the Company or any trustee or
        administrator or the Plans, or any party dealing with any such Plan, nor
        do the transactions contemplated by this Agreement constitute
        transactions which could subject any such party, to either a civil
        penalty assessed pursuant to Section 502(i) of ERISA or the tax or
        penalty on prohibited transactions imposed by Section 4975 of the IRC.
        No actions, suits or claims with respect to the assets of the Plans
        (other than routine claims for benefits) are pending or threatened which
        could result in or subject the Company to any liability, and there are
        no circumstances which could give rise to or be expected to give rise to
        any such actions, suits or claims.

             ix. CORRECT COPIES. The Company has provided or made available to
        the Purchasers counsel the Purchasers with true and complete copies of
        all documents pursuant to which the Plans are maintained and
        administered and the most recent annual reports (Form 5500 and
        attachments) for the Plans.

         5S. COMPLIANCE WITH LAWS. Neither the Company nor any Subsidiary has
violated any law or any governmental regulation or requirement which violation
has had or would reasonably be expected to have a Material Adverse Effect, and
neither the Company nor any Subsidiary has received notice of any such
violation. Neither the Company nor any Subsidiary is subject to, or has reason
to believe it may become subject to, any material liability (contingent or
otherwise) or material corrective or remedial obligation arising under any
federal, state, local or foreign law, rule or regulation (including the common
law) relating to or regulating health, safety, pollution or the protection of
the environment ("ENVIRONMENTAL LAWS"). Without limiting the generality of the
foregoing, (i) the Company and each Subsidiary have obtained all material
permits, licenses and authorizations required under, and have complied in all
material respects with, all Environmental Laws, (ii) no notice has been received
by the Company or any Subsidiary regarding any material violation of, or any
claim, liability or material corrective or remedial obligation under, any
Environmental Laws and (iii) to the Company's knowledge, no facts or
circumstances exist with respect to the past or present operations or facilities
of the Company or any Subsidiary which would give rise to a material liability
or material corrective or remedial obligation under any Environmental Laws.

         5T. AFFILIATED TRANSACTIONS. Except as set forth on the attached
"AFFILIATED TRANSACTIONS SCHEDULE," no officer, director, employee, stockholder
or Affiliate of the Company or any Subsidiary or any individual related by
blood, marriage or adoption to any such individual or any entity in which any
such Person or individual owns any beneficial interest, is a party to any

                                       27
<PAGE>

agreement, contract, commitment or transaction with the Company or any
Subsidiary or has any material interest in any material property used by the
Company or any Subsidiary other than employment arrangements entered into in the
ordinary course of the Company's or Subsidiary's business.

         5U. CLOSING DATE. The representations and warranties of the Company
contained in this SECTION 5 and elsewhere in this Agreement and all information
contained in any exhibit, schedule or attachment hereto or in any certificate or
other writing delivered by, or on behalf of, the Company to any Purchaser shall
be true and correct in all material respects on the date of the Closing as
though then made, except as affected by the transactions expressly contemplated
by this Agreement and except as expressly disclosed in writing to the Purchasers
by the Company prior to the Closing.

         5V. CUSTOMERS AND SUPPLIERS.

             i. The attached "CUSTOMER SCHEDULE" lists the 10 largest customers
        of the Company (on a consolidated basis) for each of the two most recent
        fiscal years and sets forth opposite the name of each such customer the
        percentage of consolidated net sales attributable to such customer. The
        CUSTOMER SCHEDULE also lists any additional current customers which the
        Company anticipates shall be among the 10 largest customers for the
        current fiscal year.

             ii. Since the date of the Latest Balance Sheet, no material
        supplier of the Company or any Subsidiary has indicated that it shall
        stop, or materially decrease the rate of, supplying materials, products
        or services to the Company or any Subsidiary, and no customer listed on
        the CUSTOMER SCHEDULE has indicated that it shall stop, or materially
        decrease the rate of, buying materials, products or services from the
        Company or any Subsidiary.

         5W. SMALL BUSINESS MATTERS. The Company acknowledges that ABN AMRO is a
federally licensed SBIC under the SBIC Act. The information regarding the
Company and its affiliates in SBA Form 480, Form 652 and Parts A and B of Form
1031 delivered by the Company at the Closing is accurate in all material
respects. Neither the Company nor any Subsidiary presently engages in, or shall
hereafter engage in, any activities, nor shall the Company or any Subsidiary use
the proceeds of the Financing directly or indirectly for any purpose, for which
an SBIC is prohibited from providing funds by SBIC Regulations (including 13 CFR
Section 107.720).] [TBD]

         5X. CENTURY DATE COMPLIANCE. The Company has conducted reasonable and
prudent investigations with respect to its computer software, computer firmware,
computer hardware (whether general or special purpose), and other similar or
related items of automated, computerized or software systems that are material
to the conduct of the Company's business, and based upon such investigations the
Company is not aware that any such systems are or are likely to malfunction,
cease to function, generate incorrect data or produce incorrect results (any of
the foregoing a "DATE FAILURE") when processing, providing or receiving (x)
date-related data into and between the twentieth and twenty-first centuries or
(y) date-related data in connection with any valid date in the

                                       28
<PAGE>

twentieth and twenty-first centuries (collectively, "YEAR 2000 DATA"). To the
best of the Company's knowledge, after conducting reasonable and prudent
investigations therefor, the products and services sold, licensed, rendered, or
otherwise provided by the Company in the conduct of its business, including but
not limited to the Company's proprietary software and databases, will not suffer
any Date Failure when processing, providing or receiving any Year 2000 Data
(other than any Date Failure caused by the products of others (including
hardware, software, firmware, applications and databases) used in combination
with the products supplied by the Company), and to the Company's knowledge the
Company is not subject to any claims or liabilities arising from any Date
Failure. Except as set forth on Schedule 5Y, the Company has not made any other
representations or warranties regarding the ability of any product or service
sold or licensed by the Company in the conduct of its business to operate
without a Date Failure when processing, providing or receiving Year 2000 Data.

         SECTION 6. DEFINITIONS.

         6A. DEFINITIONS. For the purposes of this Agreement, the following
terms have the meanings set forth below:

         "ABN AMRO" means ABN AMRO Capital (USA), Inc.

         "AFFILIATE" of any particular Person means any other Person
controlling, controlled by or under common control with such particular Person,
where "control" means the possession, directly or indirectly, of the power to
direct the management and policies of a Person whether through the ownership of
voting securities, contract or otherwise.

         "AMENDED AND RESTATED CERTIFICATE OF INCORPORATION" means the Company's
Amended and Restated Certificate of Incorporation set forth on EXHIBIT A hereto.

         "EVENT OF NONCOMPLIANCE" has the meaning set forth in the Amended and
Restated Certificate of Incorporation.

         "EQUITY EQUIVALENTS" means in respect of any Person (i) any securities,
instruments or rights which are convertible into or exercisable or exchangeable
for any equity securities of such Person, (ii) any phantom equity, equity
appreciate or similar rights which permit the holder thereof to participate in
the residual equity value of, or appreciation in, such Person, (iii) any
securities, instruments or rights which permit the holder thereof, under any
circumstances, to vote for the election of members of such Person's governing
body, and (iv) any securities, instruments or rights which are, directly or
indirectly, convertible into or exercisable or exchangeable for any of the
securities, instruments or rights described in clauses (i), (ii) or (iii) above.

         "INDEBTEDNESS" means at a particular time, without duplication, (i) any
indebtedness for borrowed money or issued in substitution for or exchange of
indebtedness for borrowed money, (ii) any indebtedness evidenced by any note,
bond, debenture or other debt security, (iii) any commitment by which a Person
assures a creditor against loss (including, without limitation,

                                       29
<PAGE>

contingent reimbursement obligations with respect to letters of credit), (iv)
any indebtedness guaranteed in any manner by a Person (including, without
limitation, guarantees in the form of an agreement to repurchase or reimburse),
(v) any obligations under capitalized leases (determined in accordance with
GAAP) with respect to which a Person is liable, contingently or otherwise, as
obligor, guarantor or otherwise, or with respect to which obligations a Person
assures a creditor against loss, and (vi) any indebtedness secured by a Lien on
a Person's assets.

         "INTELLECTUAL PROPERTY RIGHTS" means all (i) patents, patent
applications, patent disclosures and inventions, (ii) trademarks, service marks,
trade dress, trade names, logos and corporate names and registrations and
applications for registration thereof together with all of the goodwill
associated therewith, (iii) copyrights (registered or unregistered) and
copyrightable works and registrations and applications for registration thereof,
(iv) mask works and registrations and applications for registration thereof, (v)
trade secrets and other confidential information (including, without limitation,
ideas, formulas, compositions, inventions (whether patentable or unpatentable
and whether or not reduced to practice), know-how, manufacturing and production
processes and techniques, research and development information, drawings,
specifications, designs, plans, proposals, technical data, copyrightable works,
financial and marketing plans and customer and supplier lists and information),
(vi) other intellectual property rights and (vii) copies and tangible
embodiments thereof (in whatever form or medium).

         "INVESTMENT" as applied to any Person means (i) any direct or indirect
purchase or other acquisition by such Person of any notes, obligations,
instruments, stock, securities or ownership interest (including partnership
interests and joint venture interests) of any other Person and (ii) any capital
contribution by such Person to any other Person.

         "IRC" means the Internal Revenue Code of 1986, as amended, and any
reference to any particular IRC section shall be interpreted to include any
revision of or successor to that section regardless of how numbered or
classified.

         "IRS" means the United States Internal Revenue Service.

         "KNOWLEDGE" and "AWARE" mean and include (i) the actual knowledge or
awareness of the Company and its Subsidiaries (which shall include the actual
knowledge and awareness of the officers, directors and key employees of the
Company and its Subsidiaries and the general managers of each facility of the
Company and its Subsidiaries) and (ii) the knowledge or awareness of facts that
may be reasonably imputed to the Company. Without limiting the generality of the
forgoing, the knowledge or awareness of Ulf Arnetz, Felimy Greene, Lars
Ivarsson, Angiras Koorapaty and Hakan Wohlen shall be imputed to the Company.

         "LIENS" means any mortgage, pledge, security interest, encumbrance,
lien or charge of any kind (including, without limitation, any conditional sale
or other title retention agreement or lease in the nature thereof), any sale of
receivables with recourse against the Company, any Subsidiary or any Affiliate,
any filing or agreement to file a financing statement as debtor under the
Uniform Commercial Code or any similar statute other than to reflect ownership
by a third party of

                                       30
<PAGE>

property leased to the Company or any Subsidiaries under a lease which is not in
the nature of a conditional sale or title retention agreement, or any
subordination arrangement in favor of another Person (other than any
subordination arising in the ordinary course of business).

         "MATERIAL ADVERSE EFFECT" means an event that, alone or in the
aggregate with other events, is materially adverse to the financial condition,
operating results, assets, or operations of the Company and its Subsidiaries
taken as a whole.

         "OFFICER'S CERTIFICATE" means a certificate signed by the Company's
President or its chief financial officer.

         "PERSON" means an individual, a partnership, a corporation, a limited
liability company, an association, a joint stock company, a trust, a joint
venture, an unincorporated organization and a governmental entity or any
department, agency or political subdivision thereof.

         "PREFERRED STOCK" means the Series A Preferred Stock as described in
the Company's Amended and Restated Certificate of Incorporation, together with
the Series B Preferred.

         "RESTRICTED SECURITIES" means (i) the Series B Preferred issued
hereunder, (ii) the Common Stock issued upon conversion of the Series B
Preferred and (iii) any securities issued with respect to the securities
referred to in clauses (i) or (ii) above by way of a stock dividend or stock
split or in connection with a combination of shares, recapitalization, merger,
consolidation or other reorganization. As to any particular Restricted
Securities, such securities shall cease to be Restricted Securities when they
have (a) been effectively registered under the Securities Act and disposed of in
accordance with the registration statement covering them, or (b) been
distributed to the public through a broker, dealer or market maker pursuant to
Rule 144 (or any similar provision then in force) under the Securities Act or
become eligible for sale pursuant to Rule 144(k) (or any similar provision then
in force) under the Securities Act or (c) been otherwise transferred and new
certificates for them not bearing the Securities Act legend set forth in SECTION
4B have been delivered by the Company in accordance with SECTION 4C.

         "SBIC" means a small business investment company licensed under the
Small Business Investment Act of 1958, as amended.

         "SBIC REGULATIONS" means the Small Business Investment Company Act of
1958, as amended, and the regulations issued by the Small Business
Administration thereunder, 13 CFR 107 and 121, as amended.

         "SECURITIES ACT" means the Securities Act of 1933, as amended, or any
similar federal law then in force.

         "SECURITIES AND EXCHANGE COMMISSION" includes any governmental body or
agency succeeding to the functions thereof.

                                       31
<PAGE>

         "SECURITIES EXCHANGE ACT" means the Securities Exchange Act of 1934, as
amended, or any similar federal law then in force.

         "SERIES A PREFERRED" means the Series A Preferred Stock as described in
the Amended and Restated Certificate of Incorporation.

         "SUBSIDIARY" means, with respect to any Person, any corporation,
limited liability company, partnership, association or other business entity of
which (i) if a corporation, a majority of the total voting power of shares of
stock entitled (without regard to the occurrence of any contingency) to vote in
the election of directors, managers or trustees thereof is at the time owned or
controlled, directly or indirectly, by that Person or one or more of the other
Subsidiaries of that Person or a combination thereof, or (ii) if a limited
liability company, partnership, association or other business entity, a majority
of the units, membership interests, partnership interests or other similar
ownership interest thereof is at the time owned or controlled, directly or
indirectly, by any Person or one or more Subsidiaries of that Person or a
combination thereof. For purposes hereof, a Person or Persons shall be deemed to
have a majority ownership interest in a limited liability company, partnership,
association or other business entity if such Person or Persons shall be
allocated a majority of limited liability company, partnership, association or
other business entity gains or losses or shall be or control any manager,
managing member or general partner of, or has the power to elect a majority of
the members of governing body of, such limited liability company, partnership,
association or other business entity.

         "TREASURY REGULATIONS" means the United States Treasury Regulations
promulgated under the IRC, and any reference to any particular Treasury
Regulation section shall be interpreted to include any final or temporary
revision of or successor to that section regardless of how numbered or
classified.

         "UNDERLYING COMMON STOCK" means (i) the Common Stock issued or issuable
upon conversion of the Series B Preferred, and (ii) any Common Stock issued or
issuable with respect to the securities referred to in clause (i) above by way
of stock dividend or stock split or in connection with a combination of shares,
recapitalization, merger, consolidation or other reorganization. For purposes of
this Agreement, any Person who holds Series B Preferred shall be deemed to be
the holder of the Underlying Common Stock obtainable upon conversion of the
Series B Preferred Stock in connection with the transfer thereof or otherwise,
and regardless of any restriction or limitation on the conversion of the Series
B Preferred. As to any particular shares of Underlying Common Stock, such shares
shall cease to be Underlying Common Stock when they have been (a) effectively
registered under the Securities Act and disposed of in accordance with the
registration statement covering them, (b) distributed to the public through a
broker, dealer or market maker pursuant to Rule 144 under the Securities Act (or
any similar provision then in force) or (c) repurchased by the Company or any
Subsidiary.

         "WHOLLY-OWNED SUBSIDIARY" means, with respect to any Person, a
Subsidiary of which all of the outstanding capital stock or other ownership
interests are owned by such Person or another Wholly-Owned Subsidiary of such
Person.

                                       32
<PAGE>

         6B. OTHER DEFINITIONS. The terms set forth below are defined on the
following pages of the Agreement:

<TABLE>
<S>                              <C>
Affiliated Group..................21
Agreement..........................1
Closing............................1
Closings...........................2
Common Stock.......................1
Company............................1
Date Failure......................29
Environmental Laws................27
ERISA.............................25
Financing.........................12
First Closing......................2
First Purchasers...................1
Indemnified Liabilities...........38
Indemnities.......................38
Latest Balance Sheet..............18
Other Plans.......................26
Plans.............................26
Profit Sharing Plan...............26
Purchaser..........................1
Purchasers.........................1
Registration Agreement.............2
Relevant Documents................15
SBA...............................12
SBIC Holder.......................11
Second Closing.....................2
Stockholders Agreement.............2
Subsequent Purchasers..............1
Subsequent Shares..................2
Tax...............................19
Tax Return........................21
Taxes.............................21
Year 2000 Data....................29
</TABLE>

                                       33
<PAGE>

         SECTION 7. MISCELLANEOUS.

         7A. DIRECTED SHARE PROGRAM. In the event of the Company's initial
public offering of equity securities more than one year from the Effective Date,
and to the extent permitted by applicable law, the Company shall use its best
efforts to establish, or cause the managing underwriter to establish, a directed
share program, consistent with applicable laws, rules and regulations
(including, without limitation, rules and regulations promulgated by the
Commission and the National Association of Securities Dealers, Inc.), pursuant
to which the Purchasers shall have the option to purchase up to fifteen percent
(15%) of the securities offered (the "DIRECTED SHARES") valued at the initial
offering price; provided that the lead underwriter may reduce or eliminate
entirely such allocation if in such underwriter's judgment the initial public
offering may be adversely affected. The Purchasers shall have a right of
oversubscription with respect to the Directed Shares such that if any Purchaser
fails to purchase its pro rata portion of the Directed Shares, the other
Purchasers shall, among them, have the right to purchase up to the balance of
the Directed Shares not so purchased. If, as a result thereof, such
oversubscriptions exceed the total number of Directed Shares available in
respect of such oversubscription privilege, the oversubscribing Purchasers shall
be reduced with respect to their oversubscriptions on a pro rata basis or as
they may otherwise agree among themselves.

         7B. EXPENSES. The Company shall pay, and hold each Purchaser and all
holders of Series B Preferred and Underlying Common Stock harmless against
liability for the payment of (i) the reasonable fees and expenses of Purchasers'
counsel, not to exceed $75,000, arising in connection with the negotiation and
execution of this Agreement and the consummation of the transactions
contemplated by this Agreement which shall be payable at the Closing or, if the
Closing does not occur, payable upon demand, and (ii) stamp and other taxes
which may be payable in respect of the execution and delivery of this Agreement
or the issuance, delivery or acquisition of any shares of Series B Preferred or
any shares of Common Stock issuable upon conversion of the Series B Preferred.

         7C. REMEDIES. Each holder of Series B Preferred and Underlying Common
Stock shall have all rights and remedies set forth in this Agreement and the
other Relevant Documents, and all rights and remedies which such holders have
been granted at any time under any other agreement or contract and all of the
rights which such holders have under any law. Any Person having any rights under
any provision of this Agreement shall be entitled to enforce such rights
specifically (without posting a bond or other security), to recover damages by
reason of any breach of any provision of this Agreement and to exercise all
other rights granted by law.

         7D. PURCHASER'S INVESTMENT REPRESENTATIONS. Each Purchaser represents
and warrants to the Company and to each other Purchaser as follows:

             i. The Purchaser is acquiring the Series B Preferred shares and
        Underlying Common Stock for his own account, for investment and not with
        a view to, or

                                       34
<PAGE>

        for sale in connection with, any distribution thereof, nor with any
        present intention of distribution or selling the same in violation of
        applicable law; and the Purchaser has no present or contemplated
        agreement, undertaking, arrangement, obligation, indebtedness or
        commitment providing for such disposition.

             ii. The Purchaser has the full power and authority to enter into
        and to perform its obligations under this Agreement, the Registration
        Agreement and the Stockholders Agreement in accordance with their
        respective terms. If the Purchaser is a corporation, partnership or
        trust, it represents that it has not been organized, reorganized or
        recapitalized specifically for the purpose of investment in the Company.
        The Purchaser has adequate net worth and means of providing for his or
        its current needs and personal contingencies to sustain a complete loss
        of his investment in the Company; and the Purchaser's overall commitment
        to investments which are not readily marketable is not disproportionate
        to his net worth and the Purchaser's investment in the Series B
        Preferred shares and the Underlying Common Stock will not cause such
        overall commitment to become excessive.

             iii. The Purchaser has substantial knowledge and experience in
        making investment decisions of this type, and is capable of evaluating
        the merits and risks of this investment.

             iv. The Purchaser is an "accredited investor" within the definition
        set forth in Securities Act Rule 501(a).

             v. If the Purchaser's principal address as set forth on the
        signature page below is a location outside of the United States of
        America and its territories, the Purchaser is executing this Agreement
        outside of the United States and the Purchaser: (a) is not a U.S. person
        (as defined in Securities Act Rule 902(k)) and is not acquiring the
        Series B Preferred shares and the Underlying Common Stock for the
        account or benefit of any U.S. person; (b) will resell the Series B
        Preferred and Underlying Common Stock only in accordance with (A) the
        provisions of Regulation S promulgated under the Securities Act
        ("REGULATION S"), (B) pursuant to an effective registration statement
        under the Securities Act, or (C) pursuant to an available exemption from
        registration under the Securities Act; and agrees not to engage in
        hedging transactions unless in compliance with the Securities Act; and
        (c) will not offer or sell the Series B Preferred shares or Underlying
        Common Stock to a U.S. Person or to or for the account or benefit of a
        U.S. Person, or engage in any hedging transactions, prior to the
        expiration of the one year period after the Closing.

         7E. TREATMENT OF THE SERIES B PREFERRED. The Company covenants and
agrees that (i) so long as federal income tax laws prohibit a deduction for
distributions made by the Company with respect to the Series B Preferred, it
shall treat all distributions paid by it out of current and accumulated earnings
and profits on the Series B Preferred as non-deductible dividends on all of its
tax returns to the extent consistent with applicable law and subject to the
reasonable advice of tax

                                       35
<PAGE>

counsel or the Company's independent accountants, and (ii) it shall treat the
Series B Preferred as preferred stock in all of its GAAP based financial
statements and other reports and shall treat all distributions paid by it on the
Series B Preferred as dividends on preferred stock in such statements and
reports.

         7F. CONSENT TO AMENDMENTS. Except as otherwise expressly provided
herein, the provisions of this Agreement may be amended and the Company may take
any action herein prohibited, or omit to perform any act herein required to be
performed by it, only if the Company has obtained the written consent of the
holders of a majority of the Underlying Common Stock. No other course of dealing
between the Company and the holder of any Series B Preferred or Underlying
Common Stock or any delay in exercising any rights hereunder or under the other
Relevant Documents shall operate as a waiver of any rights of any such holders.
For purposes of SECTION 7F, shares of Series B Preferred or Underlying Common
Stock held by the Company or any Subsidiaries shall not be deemed to be
outstanding.

         7G. SURVIVAL OF REPRESENTATIONS AND WARRANTIES. All representations and
warranties contained herein or made in writing by any party in connection
herewith shall survive the execution and delivery of this Agreement and the
consummation of the transactions contemplated hereby, regardless of any
investigation made by any Purchaser or on its behalf.

         7H. SUCCESSORS AND ASSIGNS. Except as otherwise expressly provided
herein, all covenants and agreements contained in this Agreement by or on behalf
of any of the parties hereto shall bind and inure to the benefit of the
respective successors and assigns of the parties hereto whether so expressed or
not. In addition, and whether or not any express assignment has been made, the
provisions of this Agreement which are for any Purchaser's benefit as a
purchaser or holder of Series B Preferred or Underlying Common Stock are also
for the benefit of, and enforceable by, any subsequent holder of such Series B
Preferred or such Underlying Common Stock.

         7I. GENERALLY ACCEPTED ACCOUNTING PRINCIPLES. Where any accounting
determination or calculation is required to be made under this Agreement or the
exhibits hereto, such determination or calculation (unless otherwise provided)
shall be made in accordance with generally accepted accounting principles,
consistently applied, except that if because of a change in generally accepted
accounting principles the Company would have to alter a previously utilized
accounting method or policy in order to remain in compliance with generally
accepted accounting principles, such determination or calculation shall continue
to be made in accordance with the Company's previous accounting methods and
policies.

         7J. SEVERABILITY. Whenever possible, each provision of this Agreement
shall be interpreted in such manner as to be effective and valid under
applicable law, but if any provision of this Agreement is held to be prohibited
by or invalid under applicable law, such provision shall be ineffective only to
the extent of such prohibition or invalidity, without invalidating the remainder
of this Agreement.

                                       36
<PAGE>

         7K. COUNTERPARTS. This Agreement may be executed simultaneously in two
or more counterparts in the form attached hereto, any one of which need not
contain the signatures of more than one party, but all such counterparts taken
together shall constitute one and the same Agreement.

         7L. DESCRIPTIVE HEADINGS; INTERPRETATION. The descriptive headings of
this Agreement are inserted for convenience only and do not constitute a
substantive part of this Agreement. The use of the word "including" in this
Agreement shall be by way of example rather than by limitation.

         7M. GOVERNING LAW. The corporate law of the State of Delaware shall
govern all issues and questions concerning the relative rights and obligations
of the Company and its stockholders. All other issues and questions concerning
the construction, validity, enforcement and interpretation of this Agreement and
the exhibits and schedules hereto shall be governed by, and construed in
accordance with, the laws of the State of Delaware, without giving effect to any
choice of law or conflict of law rules or provisions (whether of the State of
Delaware or any other jurisdiction) that would cause the application of the laws
of any jurisdiction other than the State of Delaware.

         7N. NOTICES. All notices, demands or other communications to be given
or delivered under or by reason of the provisions of this Agreement shall be in
writing and shall be deemed to have been given when delivered personally to the
recipient, sent to the recipient by reputable overnight courier service (charges
prepaid) or mailed to the recipient by certified or registered mail, return
receipt requested and postage prepaid. Such notices, demands and other
communications shall be sent to each Purchaser at the address indicated on the
SCHEDULE OF PURCHASERS and to the Company and counsel for the Company and
Purchasers at the address indicated below:

                  Ulf Arnetz
                  President and CEO
                  Corechange, Inc.
                  260 Franklin Street, Suite 1890
                  Boston, Massachusetts  02100

                  with a copy to (which shall not constitute notice hereunder):

                  Hale and Dorr
                  60 State Street
                  Boston, Massachusetts 02109
                  Attention:       Stuart M. Falber
                  Telecopy No:  (617) 526-5000

                                       37
<PAGE>

                  Kirkland & Ellis
                  200 East Randolph Drive
                  Chicago, Illinois 60601
                  Attention:       Gary R. Silverman
                  Telecopy No:     (312) 861-2200

or to such other address or to the attention of such other person as the
recipient party has specified by prior written notice to the sending party.

         7O. UNDERSTANDING AMONG THE PURCHASERS. The determination of each
Purchaser to purchase the Series B Preferred pursuant to this Agreement has been
made by such Purchaser independent of any other Purchaser and independent of any
statements or opinions as to the advisability of such purchase or as to the
properties, business, prospects or condition (financial or otherwise) of the
Company and its Subsidiaries which may have been made or given by any other
Purchaser or by any agent or employee of any other Purchaser. In addition, it is
acknowledged by each of the other Purchasers that ABN AMRO has not acted as an
agent of such Purchaser in connection with making its investment hereunder and
that ABN AMRO shall not be acting as an agent of such Purchaser in connection
with monitoring its investment hereunder. Each Purchaser represents that there
are no claims for brokerage commissions, finders' fees or similar compensation
in connection with the transactions contemplated by this Agreement based on any
arrangement or agreement that is binding on such Purchaser, and each Purchaser
shall pay, and hold each other Purchaser and the Company harmless against, any
liability, loss or expense (including, without limitation, reasonable attorneys'
fees and out of pocket expenses) arising in connection with any such claim or
any other claim arising out of the failure of the acknowledgements and
understandings stated in this SECTION 7N.

         7P. NO STRICT 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 hereto, and no presumption or
burden of proof shall arise favoring or disfavoring any party by virtue of the
authorship of any of the provisions of this Agreement.

                                       38
<PAGE>

         7Q. ENVIRONMENTAL LIABILITIES. Without limiting the generality of the
representations and warranties set out in SECTION 5 above, the Company shall
defend, protect, indemnify and hold harmless each Purchaser and all other
Indemnitees from and against any and all actions, causes of action, suits,
losses, liabilities, damages, injuries, penalties, fees, costs, expenses and
claims of any and every kind whatsoever paid, incurred or suffered by, or
asserted against, each Purchaser or any other Indemnitee for, with respect to,
or as a direct or indirect result of, the past, present or future environmental
condition of any property owned, operated or used by the Company, any
Subsidiary, their predecessors or successors or of any offsite treatment,
storage or disposal location associated therewith, including, without
limitation, the presence on or under, or the escape, seepage, leakage, spillage,
discharge, emission, release, or threatened release into, onto or from, any such
property or location of any toxic, chemical or hazardous substance, material or
waste (including, without limitation, any losses, liabilities, damages,
injuries, penalties, fees, costs, expenses or claims asserted or arising under
the Comprehensive Environmental Response, Compensation and Liability Act, any
so-called "Superfund" or "Superlien" law, or any other federal, state, local or
foreign statute, law, ordinance, code, rule, regulation, order or decree
regulating, relating to or imposing liability or standards on conduct
concerning, any toxic, chemical or hazardous substance, material or waste),
regardless of whether caused by, or within the control of, the Company or any
Subsidiary.

                                    * * * * *

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

                                CORECHANGE, INC.

                                By:  /s/ ULF ARNETZ

                                Its:  President / CEO

                                Date:  Feb. 18, 2000

                                       39
<PAGE>

                             SCHEDULE OF PURCHASERS

    ------------------------------------------------------------------------
<TABLE>
<CAPTION>

                                  NO. OF SHARES OF       TOTAL PURCHASE
     NAMES AND ADDRESSES         SERIES B PREFERRED    PRICE FOR SERIES B
                                       STOCK            PREFERRED STOCK
<S>                              <C>                   <C>

</TABLE>

                                       40
<PAGE>

                                Corechange, Inc.
           Schedule of Series B Preferred Convertible Bridge Financing

<TABLE>
<CAPTION>
                                                  Date of    Interest till    Daily     Principal    # of Series B
Name                                Amount        Deposit       2/18/00     Interest    + Interest    Pref Shares
<S>                                <C>           <C>          <C>             <C>      <C>           <C>
HarbourVest Partners LLC           $   500,000   11/2/99      $   11,945.21$   109.59  $  511,945       87,707

Ulf Arnetz                         $   250,000   11/2/99      $    5,972.60     54.79  $  255,973       43,853

Torbjorn Karlsson                  $   250,000   11/2/99      $    5,972.60     54.79  $  255,973       43,853

Breviksgruppen AB                  $   100,000   12/29/99     $    1,139.73     21.92  $  101,140       17,327

Minvest AB                         $   120,000   12/29/99     $    1,367.67     26.30  $  121,368       20,793

Henrik Ingvarsson                  $    25,000   12/29/99     $      284.93      5.48  $   25,285        4,332

Andreas Nyberg                     $    13,000   12/29/99     $      148.16      2.85  $   13,148        2,253

Dan Segenmark                      $   120,000   12/29/99     $    1,367.67     26.30  $  121,368       20,793

Lars Ahlstrom                      $    50,000   12/29/99     $      569.86     10.96  $   50,570        8,664

Jan Khilberg                       $   120,000   12/29/99     $    1,367.67     26.30  $  121,368       20,793

Andreas Segenmark                  $   120,000   12/29/99     $    1,367.67     26.30  $  121,368       20,793

Svensk Vininformation AB           $    50,000   12/29/99     $      569.86     10.96  $   50,570        8,664

J O Hersler Consulting AB          $    20,000   12/29/99     $      227.95      4.38  $   20,228        3,465

Sofie Emilsson                     $    50,000   12/29/99     $      569.86     10.96  $   50,570        8,664

Rosebud Corporation                $   300,000   12/29/99     $    3,419.18     65.75  $  303,419       51,982

Robert Friberg                     $   200,000   12/29/99     $    2,279.45     43.84  $  202,279       34,655

Svensk Vininformation AB           $    40,000   12/29/99     $      455.89      8.77  $   40,456        6,931

Andreas Strindholm                 $    10,000   12/29/99     $      113.97      2.19  $   10,114        1,733

Per Sahlestrom                     $    20,000   12/29/99     $      227.95      4.38  $   20,228        3,465

Jan Matsson                        $    18,000   12/29/99     $      205.15      3.95  $   18,205        3,119

Harald Mattson Marn                $    58,500   12/29/99     $      666.74     12.82  $   59,167       10,136

Carl Mattson Marn                  $    58,500   12/29/99     $      666.74     12.82  $   59,167       10,136

Hans Bjurklint                     $    35,000   12/29/99     $      398.90      7.67  $   35,399        6,065

Rikard Svensson                    $   150,000   12/29/99     $    1,709.59     32.88  $  151,710       25,991

Fredrik Svensson                   $   150,000   12/29/99     $    1,709.59     32.88  $  151,710       25,991

Matz Borsch                        $   100,000   12/29/99     $    1,139.73     21.92  $  101,140       17,327

Bjorn von Malmborg                 $   143,000   12/29/99     $    1,629.81     31.34  $  144,630       24,778

Hans Jacobsson                     $    81,000   12/29/99     $      923.18     17.75  $   81,923       14,035

Adam Dahlberg                      $   115,000   12/29/99     $    1,310.68     25.21  $  116,311       19,926

Stina Linden                       $    20,000   1/27/00      $      100.82      4.38  $   20,101        3,444

Ulf Oster                          $    20,000   1/27/00      $      100.82      4.38  $   20,101        3,444

Erik Ekberg                        $    15,000   1/27/00      $       75.62      3.29  $   15,076        2,583

Strom & Partners                   $    45,000   1/27/00      $      226.85      9.86  $   45,227        7,748

Richard Hellberg                   $    16,000   2/7/00       $       42.08      3.51  $   16,042        2,748

                                   $ 3,383,000                $      50,274   $   741  $3,433,274      588,192

Direct Investors in the Series B

Harbourvest Capital                $ 1,500,000                                                         256,981

ABN AMRO Capital (USA), Inc.       $ 4,000,000                                                         685,284

Xcelera.com                        $ 3,500,000                                                         599,623

Xcelera.com                        $ 5,000,000                                                         856,604

Ronald Hirsch                      $    25,000                                                           4,283

UK Private Investors

AIB Nominees                       $    75,000                                                          12,849

Marquis Limited                    $    50,000                                                           8,566

Ms. Caroline Kauslick Coombs       $    50,000                                                           8,566

Mr. Phelim Greene                  $    25,000                                                           4,283

Mr. Donal Greene                   $    32,000                                                           5,482

Mr. Kevin MacNally                 $    25,000                                                           4,283

Mrs. Niamh McGowan                 $    25,000                                                           4,283

Ms. Margaret Kennedy               $    43,750                                                           7,495

Total Direct Series B Preferred I  $14,350,750                                                       2,458,583

Total Converted + Direct Investor  $17,733,750                                                       3,046,775

<CAPTION>

<S>                                 <C>

HarbourVest Partners LLC            One Financial Center Boston

Ulf Arnetz                          260 Franklin St Boston

Torbjorn Karlsson                   c/o Corechange Svenska, Stockholm

Breviksgruppen AB                   Birger Jarlsgatan 2, 114 32 Stockholm

Minvest AB                          Neglinge Center, 133 33 Saltsjobaden

Henrik Ingvarsson                   Vikingagatan 27, 113 42 Stockholm

Andreas Nyberg                      Fleminggatan 56, 112 45 Stockholm

Dan Segenmark                       Kistavagen 14, 192 67 Sollentuna

Lars Ahlstrom                       Bergsjoholm, 271 91 Ystad

Jan Khilberg                        Engelbrektsgatan 18, 5 Tr, 114 32 Stockholm

Andreas Segenmark                   Borgvagen 21, 192 55 Sollentuna

Svensk Vininformation AB            Box 9175, 102 73 Stockholm

J O Hersler Consulting AB           Engelbrektsgatan 39, 3 tr, 114 32 Stockholm

Sofie Emilsson                      Radmansgatan 84, 113 29 Stockholm

Rosebud Corporation                 C/O Jean Paul Le Grand, 37 39 Avenue Dumas, Geneva Switzerland

Robert Friberg                      Sockenvagen 141, 132 46 Stockholm

Svensk Vininformation AB            Box 9175, 102 73 Stockholm

Andreas Strindholm                  Ballonggatan 21, 169 71 Solna

Per Sahlestrom                      Bromma Kyrkvag 448, 168 58 Bromma

Jan Matsson                         Palsundsgatan 6, 117 31 Stockholm

Harald Mattson Marn                 Styrmansgatan 24, 114 54 Stockholm

Carl Mattson Marn                   Styrmansgatan 24, 114 54 Stockholm

Hans Bjurklint                      Skapparp, 310 40 Harplinge

Rikard svensson                     Herrgardsgatan 2 A, 722 13 Vasteras

Fredrik Svensson                    Skeppsgatan 1, 721 32 Vasteras

Matz Borsch                         Tornbrinken 6, 132 36 Saltsjo-Boo

Bjorn von Malmborg                  Camino Alto, 108 La Moraleja, 28109 Al Cobendas(Mardrid)Spanien

Hans Jacobsson                      Kiviksgatan 13, 168 54 Bromma

Adam Dahlberg                       Riddargatan 15, 114 57 Stockholm

Stina Linden                        Baltvagen 7, 191 33 Sollentuna

Ulf Oster                           Skogsfrugrand 33, 167 62 Bromma

Erik Ekberg                         Strandvagen 57, 115 23 Stockholm

Strom & Partners                    Strom & Partners, P O Box 775, 8024 Zurich, Switzerland

Richard Hellberg                    Engelbrektsgatan 23, 114 23 Stockholm

DIRECT INVESTORS IN THE SERIES B

Harbourvest Capital                 One Financial Center, 44th Floor, Boston, MA 02111

ABN AMRO Capital (USA), Inc.        208 South LaSalle Street, 10th Floor, Chicago, IL 60604

Xcelera.com                         Ugland House, South Church Street, Grand Cayman, Cayman Island, British West Imdies

Xcelera.com                         Ugland House, South Church Street, Grand Cayman, Cayman Island, British West Imdies

Ronald Hirsch                       223 North Guadalupe, PMB # 153, Santa Fe, NM 87501

UK Private Investors

AIB Nominees                        AIB Nominees, Allied Irish Bank House, P.O. Box 468, Grenville Street, St.
                                    Hellier, Jersey JE 8WT, Channel Islands

Marquis Limited                     Mr. Brad Walmsley, VP Cititrust Switzerland, 62 Rue du Rhone, PO BOAX 3946, CH-1211,
                                    Geneva 3, Switzerland

Ms. Caroline Kauslick Coombs        23 York Avenue, East Sheen, London, SW14, 7LQ, UK

Mr. Phelim Greene                   72 Leopardstown Ave., Blackrock, Co. Dublin, Ireland

Mr. Donal Greene                    Treetops, 114 Roebuck Road, Clonskeagh, Dublin 14, Ireland

Mr. Kevin MacNally                  3 Ailesbury Way, Ailesbury Road, Dublin 4, Ireland

Mrs. Niamh McGowan                  Smurfit Print, 33 Botanic Road, Glasnevin, Dublin 9, Ireland

Ms. Margaret Kennedy                9 Ashurst College Road, Kilkenny, Co. Kilkenny, Ireland

Total Direct Series B Preferred I

Total Converted + Direct Investor
</TABLE>

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