Document:

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          EXHIBIT 10.12

          DRAFT (1): 25 September 2000
          5CT/X67766/EJL : LN:66BDC1_38(3)

          AGREEMENT

          between

          Redwave plc
          as "Redwave"

          Wave Systems Corp
          as "Wave"

          Global Wave Limited
          as the "Company"

          and

          Earthquest Limited
          as "Earthquest"

          relating to

          GLOBAL WAVE LIMITED

          SIMMONS & SIMMONS

          21 Wilson Street London EC2M 2TX
          Tel: +44(0)20 7628 2020 / 7528 9292  Fax: +44(0)20 7628 2070 DX
          Box No 12

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<Table>
<Caption>
                                    CONTENTS
<S>      <C>                                                                                                       <C>
1.       Definitions and Interpretation............................................................................1

2.       Transactions to be formalised.............................................................................3

3.       Constitution and Share Subscription.......................................................................3

4.       Development of the Transaction Processing System..........................................................4

5.       Costs.....................................................................................................5

6.       Entire agreement..........................................................................................5

7.       Miscellaneous.............................................................................................5

8.       Notices...................................................................................................5

9.       Choice of law, submission to jurisdiction and address for service.........................................6

SCHEDULE 1 : Minutes of a Meeting of the Directors.................................................................7

SCHEDULE 2 : Draft Notice of Extraordinary General Meeting of the Company..........................................9

SCHEDULE 3 : Draft Minutes of a Meeting of the Company............................................................11
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                                        i
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THIS AGREEMENT is dated                                            2000 and made

BETWEEN:

(1)    REDWAVE PLC, (No. 3838649) a company incorporated under the laws of
       England whose registered office is at Crown House, 72 Hammersmith Road,
       London W14 8TH ("Redwave");

(2)    WAVE SYSTEMS CORP, a company incorporated under the laws of the State
       of Delaware whose principal office is at 480 Pleasant Street, Lee,
       Massachusetts, United States of America ("Wave");

(3)    GLOBAL WAVE LIMITED, (No. 3402827) a company incorporated under the
       laws of England and Wales whose registered office is at Crown House, 72
       Hammersmith Road, London W14 8TH (the "Company"); and

(4)    EARTHQUEST LIMITED, (No. 4007347) a company incorporated under the
       laws of England and Wales whose registered office is at 12 Great James
       Street, London WC1N 3DR ("Earthquest").

WHEREAS:

(A)    the Company is a private company limited by shares incorporated in
       England under the Act on 8 July 1997 and at the date hereof has an
       authorised share capital of L 1,000,000 divided into 600,000 "A"
       Shares of L 1 each and 400,000 "B" Shares of L 1 each of which
       all the "A" Shares are owned by Redwave and all the "B" Shares are owned
       by Wave;

(B)    the Company was established for the purpose of exploiting certain
       intellectual property and associated services known as the "Wave System"
       in the Territory;

(C)    by an agreement dated 19 June 2000 Redwave and Earthquest subscribed
       for additional shares in the capital of the Company and expanded the
       scope of their co-operation; and

(D)    Redwave and Earthquest now wish to make further investments in the
       Company and make arrangements with respect to certain expenditure
       incurred in developing the technology.

NOW IT IS HEREBY AGREED as follows:

1.     DEFINITIONS AND INTERPRETATION

1.1    In this Agreement unless the context otherwise requires:

       (a)    the following expressions have the following meaning:

              "ACT" means the Companies Act 1985 (as amended)

              ""A" SHARES" means "A" Ordinary Shares of L 1 each in the
              capital of the Company

              "BOARD" means the Board of Directors of the Company for the time
              being

              ""B" SHARES" means "B" Ordinary Shares of L 1 each in the
              capital of the Company

              "DEBENTURE" means the first fixed and floating charge over the
              assets and undertaking of the Company granted by the Company in
              favour of Redwave to

                                        1
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              secure the obligations of the Company under the Prior Indebtedness
              Loan Agreement

              "DIRECTOR" means an "A" Director or "B" Director, as the case may
              require, and "Directors" shall be construed accordingly

              "INTELLECTUAL PROPERTY" means all intellectual property rights of
              whatever nature including (without limitation) patents, registered
              designs, trade marks and service marks (whether registered or
              not), copyright, design rights, licensing rights and all similar
              proprietary rights and interests, all other claims, rights, title,
              interest and extensions of the foregoing and any protection
              similar to the foregoing including those subsisting (in any part
              of the world) in any computer programs, software, hardware, source
              codes, prototypes, models, presentation boards, photographic
              transparencies, advertising film separations, confidential
              information, business or brand names, goodwill or the style of
              presentation of goods or services and in applications for
              protection thereof comprised in the Patents and the Know-How

              "KNOW-HOW" means the know-how and business model developed and
              used by Wave for the exploitation of the Patents

              "LICENCE" means the revised licence of the Intellectual Property
              in the agreed form

              "PARTIES" means the parties to this Agreement

              "FACILITY LETTER" means the loan agreement, dated 19 June 2000
              between Redwave and the Company

              "PATENTS" means the patent licences referred to in the Licence

              "REDWAVE SOLICITORS" means Simmons & Simmons, 21 Wilson Street,
              London, EC2M 2TX

              "SHAREHOLDERS" means the "A" Shareholder and the "B" Shareholder
              together and "Shareholder" shall mean either of them

              "SHARES" means "A" Shares or "B" Shares or, as the context
              requires, "A" Shares and "B" Shares

              "TRANSACTION PROCESSING SYSTEM" means a computer system with
              proprietary software which will create user accounts, charge and
              recharge Wave metering hardware devices, poll Wave metering
              hardware devices to collect usage statistics, calculate amounts
              due to content providers and assist in the payment of such third
              parties; such operational features to be capable of operating to
              generally accepted commercial standards and with commercially
              appropriate levels of resilience and security as might ordinarily
              be expected from the operation of a payment system

              "WAVE'S LEGAL COUNSEL" means Bingham Dana LLP in respect of US law
              and Marriott Harrison of 12 Great James Street, London WC1N 3DR in
              respect of English law

              any document expressed to be "in the agreed form" means a document
              in a form approved by (and for the purpose of identification
              signed by or on behalf of) the Parties;

       (b)    references:

                                        2
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              (i)    to clauses and schedules are unless otherwise stated to
                     clauses of and the schedules to this Agreement; and

              (ii)   to any English legal term for any action, remedy, method of
                     of judicial proceeding, legal document, legal status,
                     Court, official or any legal concept or thing shall in
                     respect of any jurisdiction other than England be deemed to
                     include that which most nearly approximates in that
                     jurisdiction to the English legal term;

       (c)    to any enactment (meaning any statute or statutory provision,
              whether of the United Kingdom or elsewhere subordinate legislation
              (as defined by section 2(1) of the Interpretation Act 1978) and
              any other subordinate legislation made under any such statute or
              statutory provision) shall be construed as references to that
              enactment as re-enacted, replaced or modified from time to time,
              whether before, on or after the date hereof;

       (d)    words importing the singular include the plural and vice versa,
              words importing a gender include every gender and references to
              persons include bodies corporate or unincorporate;

       (e)    the headings to the clauses and the schedules are for convenience
              only and shall not affect the construction or interpretation of
              this Agreement; and

       (f)    the Interpretation Act 1978 shall apply in the same way as it
              applies to an enactment.

2.     TRANSACTIONS TO BE FORMALISED

2.1    As at the date hereof the sum of L 5,966,615 is outstanding from the
       Company to Redwave pursuant to the terms of the Facility Letter and the
       Debenture. Redwave has agreed to capitalise this debt and subscribe an
       additional L 33,385 in cash for 60,000 "A" Shares.

2.2    Pursuant to the terms of the Licence, Wave has been actively developing a
       Transaction Processing System and has incurred costs of L 1.5m on
       the internationalisation of that Transaction Processing System for use by
       the Company. The Company has agreed to pay to Wave the sum of L 1.5m
       for this work, subject to the provisions of clause 4.3.

2.3    In order to maintain its holding of 40% of the issued share capital of
       the Company, Wave has agreed to subscribe for a further 40,000 "B" Shares
       in the capital of the Company at a price of L 100 per "B" Share
       partly paid as to L 72.50 per "B" Share (through the capitalisation
       of the receivable referred to in clause 2.2 in the sum of L 1.5m in
       respect of the internationalisation of the Transaction Processing System
       and L 1.4m in cash (being US$2,000,000 at an agreed exchange rate of
       L 1 : US$1.428)). The balance due on the "B" Shares, in total, the
       sum of L 1.1m (being L 27.50 per "B" Share) (subject to
       adjustment in accordance with clause 4.2) shall be reduced from time to
       time by any amount payable by the Company for further development
       services (other than in respect of the Transaction Processing System)
       provided by Wave or any party nominated by Wave and agreed by the
       Company, such amount to be approved by the Company prior to such
       reduction. Any balance of the sum of L 1.1m outstanding as at 01
       January 2002 shall be paid in cash by Wave to the Company by no later
       than 15 January 2002 or any other date to be determined by the Board.

3.     CONSTITUTION AND SHARE SUBSCRIPTION

3.1    Forthwith upon the execution of this Agreement:

                                        3
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(A)    Redwave and Wave shall procure that a meeting of the Board is convened
       and held at which will be transacted the business set out in the draft
       minutes in schedule 1 and Redwave and Wave shall join in taking all such
       steps as may be requisite to procure that:

       (1)    the resolutions of the Board set out in such minutes shall be
              passed unanimously; and

       (2)    at the Extraordinary General Meeting referred to in and convened
              at such Board meeting the Special Resolution set out in the draft
              Notice of Extraordinary General Meeting in schedule 2 shall be
              passed by the requisite majority.

(B)    Subject to and forthwith upon the passing of the Special Resolution set
       out in schedule 2:

       (1)    Redwave shall subscribe for 60,000 "A" Shares the consideration
              for which shall be those sums set out in clause 2.1;

       (2)    Wave shall procure that Earthquest subscribes for 40,000 "B"
              Shares at L 100 per "B" Share (to be issued credited as
              partly paid at L 72.50 per "B" Share), the consideration for
              which shall be the capitalisation of L 1.5m of development
              costs and L 1.4m in cash; and

       (3)    the Facility Letter and the Debenture shall be terminated and
              released by Redwave.

3.2    Forthwith following the due performance of the provisions of clause 3.1,
       the Parties shall procure that a meeting of the Board is convened and
       held at which will be transacted the business set out in the draft
       minutes in schedule 3 and the Parties shall join in taking such steps as
       may be requisite to procure that the resolutions of the Board set out in
       such minutes shall be passed.

4.     DEVELOPMENT OF THE TRANSACTION PROCESSING SYSTEM

4.1    Pursuant to the terms of the Licence, Wave has agreed to develop an
       internationalised Transaction Processing System for operation by the
       Company. Pursuant to clause 2 of this Agreement the Company has agreed to
       pay Wave L 1.5m for such work (which, for the avoidance of doubt,
       shall include all further versions of any Transaction Processing System
       developed or required to function in conjunction with the Wave System (as
       the same is defined in the Licence) as enhanced or developed from time to
       time. The payment of this sum by the allotment of the "B" Shares shall be
       deemed to be the full discharge by the Company of its obligations to pay
       pursuant to clause 5(A) of the Licence.

4.2    Wave agrees to complete development of the internationalised Transaction
       Processing System and to deliver the Transaction Processing System to the
       Company for acceptance testing, such acceptance testing to be carried out
       by Wave in conjunction with the Company for a period of 14 days
       thereafter and to be completed by 01 March 2001. Acceptance testing will
       include the functionality, capacity and resilience of the Transaction
       Processing System.

4.3    In the event that Wave fails to deliver the Transaction Processing System
       and acceptance testing has not been completed to the satisfaction of the
       Company by 01 April 2001 Wave shall pay to the Company by way of
       liquidated damages, a sum equal to 5% (five per cent.) per month on the
       principal sum of L 1.5m (paid by the Company to Wave pursuant to
       clause 2.3). Any such sum shall not be paid in cash to the Company but
       shall accrue as a credit to the Company in the accounting records of Wave
       to be applied against future

                                        4
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       development costs that the Company may incur with Wave (other than in
       respect of the Transaction Processing System and development in relation
       thereto for which full consideration has been received by Wave).

5.     COSTS

       Each of the Parties shall be responsible for its respective legal and
       other costs incurred in relation to the preparation and completion of
       this Agreement.

6.    ENTIRE AGREEMENT

6.1    This Agreement and the agreed form documents referred to herein together
       set forth the entire agreement and understanding between the Parties or
       any of them in connection with the Company and the arrangements described
       herein.

6.2    No purported variation of this Agreement shall be effective unless made
       in writing.

7.    MISCELLANEOUS

7.1    If any term or provision in this Agreement shall be held to be illegal or
       or unenforceable, in whole or in part, under any enactment or rule of
       law, such term or provision or part shall to that extent be deemed not to
       form part of this Agreement but the enforceability of the remainder of
       this Agreement shall not be affected.

7.2    This Agreement may be entered into in any number of counterparts and by
       the Parties to it on separate counterparts, each of which when executed
       and delivered shall be an original, but all the counterparts shall
       together constitute one and the same instrument.

8.     NOTICES

8.1    Any notice or other document to be given under this Agreement shall be in
       writing and shall be deemed duly given:

       (a)    if to be given to Wave or Earthquest, if left at or sent by (i)
              airmail or express or other fast postal service or (ii) facsimile
              transmission or other means of telecommunication in permanent
              written form to the following address or number:

              (A)    name                  Wave Systems Corp and Earthquest Ltd

                     address               480 Pleasant Street
                                           Lee
                                           Massachusetts
                                           USA

                     attention             The President

                     facsimile no.         001 413 243 0045

                     or to such other address and/or number as the relevant
                     Party may by notice to all other Parties hereto expressly
                     substitute therefor;

       (b)    if to be given to Redwave, if left at or sent by (i) first class
              post post or airmail or express or other fast postal service or
              (ii) facsimile transmission or other means of telecommunication in
              permanent written form to the following address or number:

              (A)    name                  Redwave pIc

                                        5
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                     address               Crown House
                                           72 Hammersmith Road
                                           London
                                           W14 8TH

                     attention             Kevin Allen

                     facsimile no.         + 44 (0) 207 559 9724

              or to such other address and/or number as such Party may by notice
              to all other Parties hereto expressly substitute therefor;

       (c)    if to be given to the Company, if left at or sent by (i) first
              class post or express or other fast postal service or (ii)
              facsimile transmission or other means of telecommunication in
              permanent written form to the following address or number:

                     name                  Global Wave Limited

                     address               Crown House
                                           72 Hammersmith Road
                                           London
                                           W14 8TH

                     attention             Kevin Allen

                     facsimile no.         + 44 (0) 207 559 9724

              or to such other address and/or number as such Party may by notice
              to all other Parties hereto expressly substitute therefor; and

       (d)    when in the ordinary course of the means of transmission it would
              first be received by the addressee in normal business hours.

8.2    In proving the giving of a notice it shall be sufficient to prove that
       the notice was left or that the envelope containing such notice was
       properly addressed and posted or that the applicable means of
       telecommunications was properly addressed and despatched (as the case may
       be).

8.3    The Company undertakes with each of the Shareholders that it will
       forthwith supply to each of such Shareholders a copy of any notice which
       may be given to or served on it under this Agreement.

9.     CHOICE OF LAW, SUBMISSION TO JURISDICTION AND ADDRESS FOR SERVICE

9.1    This Agreement shall be governed by and interpreted in accordance with
       English law.

9.2    The Parties hereby submit to the jurisdiction of the High Court of
       Justice in England, but this Agreement may be enforced in any court of
       competent jurisdiction.

9.3    Wave hereby irrevocably authorises and appoints Marriott Harrison ( or
       such other person, being a firm of solicitors resident in England, as
       Wave may by notice to all other Parties substitute) to accept service of
       all legal process arising out of or connected with this Agreement and
       service on Marriott Harrison (or such substitute) shall be deemed to be
       service on Wave.

IN WITNESS whereof this Agreement has been entered into the day and year first
above written

                                        6
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               SCHEDULE 1: MINUTES OF A MEETING OF THE DIRECTORS

                              GLOBAL WAVE LIMITED

 MINUTES of a Meeting of the Directors held at 21 Wilson Street, London EC2M 2TX
                        on - 2000 at .................pm

PRESENT:               Laurence Blackall                       (In the Chair)
                       Ian Martin
                       Stephen Sprague

IN ATTENDANCE:         Ed Lukins                          (Simmons & Simmons)

1.     IT WAS RESOLVED THAT Laurence Blackall be appointed Chairman of the
       Meeting and it was noted that a quorum was present.

2.     There was produced to the Meeting a Notice convening an Extraordinary
       General Meeting of the Company containing a proposed Special Resolution
       to:

       (a)    increase the authorised share capital of the Company from
              L 1,000,000 to L 1,500,000 by the creation of 460,000
              "A" Shares of L 1.00 each and 40,000 "B" Shares of
              L 1.00 each; such "A" and "B" Shares having attached thereto
              the respective rights set out in the Articles of Association to be
              adopted by the Company pursuant to paragraph 1(c) below;

       (b)    grant authority to the Directors of the Company to allot the
              shares referred to in paragraph 1(a) above; and

       (c)    adopt new Articles of Association;

       such Notice containing a form for consents to short notice.

3.     IT WAS RESOLVED that:

       (a)    the said Notice be and it is hereby approved;

       (b)    the Extraordinary General Meeting be held forthwith; and

       (c)    the Meeting be adjourned for that purpose.

4.     The Meeting was thereupon adjourned.

5.     When the Meeting reconvened it was reported that the Extraordinary
       General Meeting had been duly convened and held and that the Special
       Resolution (a print of which, signed by the Chairman of the Extraordinary
       General Meeting, was produced to the Meeting) had been duly passed.

       IT WAS RESOLVED that the Secretary be instructed to arrange for the
       filing with the Registrar of Companies of all necessary returns.

                                        7
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6.     There being no further business, the meeting was closed.

                                      .........................
                                               Chairman

                                        8
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    SCHEDULE 2: DRAFT NOTICE OF EXTRAORDINARY GENERAL MEETING OF THE COMPANY

                               GLOBALWAVE LIMITED
                                  (NO 3402827)

                     NOTICE OF EXTRAORDINARY GENERAL MEETING

Notice is hereby given that an Extraordinary General Meeting of the Company will
be held at 21 Wilson Street, London EC2M 2TX at ................pm on - 2000 for
the purpose of considering and, if thought fit, passing the following resolution
as a special resolution:

                               SPECIAL RESOLUTIONS

THAT:

1.     the share capital of the Company be increased from L 1,000,000 to
       L 1,500,000 by the creation of 460,000 "A" Shares of L 1.00
       each and 40,000 "B" Shares of L 1.00 each, such shares having the
       rights set out in the new Articles of Association adopted pursuant to
       Resolution 4 below;

2.     the Directors be and they are hereby generally and unconditionally
       authorised in accordance with section 80 of the Companies Act 1985 (the
       "Act"), and in substitution for any existing powers to allot relevant
       securities (as defined in section 80 of the Act), to exercise all the
       powers of the Company to allot relevant securities up to an aggregate
       nominal amount of L 500,000, such authority to expire five years from
       the date of the passing of this Resolution (both dates inclusive) except
       that the Company may make any offer or agreement before the expiry of
       this authority that would or might require relevant securities to be
       allotted after this authority has expired and the Directors may allot
       relevant securities in pursuance of any such offer or agreement as if
       this authority had not expired;

3.     the Directors be and they are hereby empowered, pursuant to section 95 of
       the Act, to allot equity securities (as defined by section 94 of the
       Act), pursuant to the authority referred to in Resolution 4 below as if
       section 89(1) of the Act did not apply to any such allotment and shall
       expire on the fifth anniversary of the date of the passing of this
       Resolution, except that the Company may before such expiry make offers or
       agreements which would or might require equity securities to be allotted
       after such expiry and notwithstanding such expiry the Directors may allot
       equity securities in pursuance of such offers or agreements; and

4.     the articles of association produced to the meeting be adopted as the
       Articles of Association of the Company.

Dated - 2000                                               By order of the Board

Registered Office:
Crown House
72 Hammersmith Road
London W14 8TH

                                        9
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                               GLOBAL WAVE LIMITED

                         FORM OF CONSENT TO SHORT NOTICE

We, the undersigned, being all the members of the Company having a right to
attend and vote at the Extraordinary General Meeting convened to be held on -
2000 and together holding all the shares giving that right HEREBY AGREE that the
said Meeting shall be deemed to have been duly called and that the Special
Resolutions set out in the Notice of the said Meeting may be proposed and passed
notwithstanding that shorter notice than that specified in the Companies Act
1985 or the Company's Articles of Association has been given.

Dated - 2000

...................................
Duly authorised
for and on behalf of
Earthquest Limited

...................................
Duly authorised
for and on behalf of
Redwave plc

                                       10
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              SCHEDULE 3: DRAFT MINUTES OF A MEETING OF THE COMPANY

                              GLOBAL WAVE LIMITED

                      MINUTES of a Meeting of the Directors
                    held at 21 Wilson Street, London EC2M 2TX
                          on - 2000 at .............pm

PRESENT:          Laurence Blackall                  (In the Chair)
                  Ian Martin
                  Stephen Sprague

IN ATTENDANCE:    Ed Lukins                 (Simmons & Simmons)

1.     IT WAS RESOLVED THAT Laurence Blackall be appointed Chairman of the
       Meeting and it was noted that a quorum was present.

2.     There were produced to the Meeting:

2.1    an agreement to be made between Wave Systems Corp, Earthquest Limited,
       Redwave plc and the Company (the "Agreement") dealing with certain
       further subscriptions of shares in the capital of the Company and
       treatment of certain development costs; and

2.2    the following applications for the allotment of shares in the capital of
       the Company:

       (A)    Redwave plc applying for the allotment of 60,000 "A" Shares in the
              capital of the Company; and

       (B)    Earthquest Limited applying for the allotment of 40,000 "B" Shares
              in the capital of the Company.

3.     IT WAS RESOLVED THAT:

3.1    the Agreement be approved;

3.2    the applications for the allotment of "A" Shares and "B" Shares of the
       Company produced to the Meeting be and they are hereby approved and that
       the respective Shares be issued, credited as fully paid up in the case of
       the "A" Shares, the consideration being the capitalisation of a loan of
       L 5,966,615 and L 33,385 in cash, and in the case of the "B"
       Shares credited as partly paid to the extent of L 72.50 against a
       subscription price of L 100 per "B" Share;

3.3    Share Certificates for the "A" Shares and the "B" Shares in the names of
       the allotted be issued by the Company;

3.4    the Share Option Scheme produced to the meeting be approved for execution
       by the Company and that options be granted to employees in accordance
       with the schedule annexed to these minutes; and

3.5    the Secretary be directed to arrange for filling of the following forms
       with the Registrar of Companies:

       (A)    88(2) in respect of the allotments of "A" Shares and "B" Shares
              respectively; and

       (B)    123 in respect of the increase in the authorised share capital of
              the Company.

                                       11
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4.     There being no further business, the Meeting was closed.

                                      ...........................
                                                Chairman

                                       12
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SIGNED by                          )
-                                  )      ....................................
duly authorised                    )
for and on behalf of               )
REDWAVE PLC                        )
in the presence of:                )

SIGNED by                          )
-                                  )      ....................................
duly authorised                    )
for and on behalf of               )
WAVE SYSTEMS CORP                  )
in the presence of:                )

SIGNED by                          )
-                                  )      ....................................
duly authorised                    )
for and on behalf of               )
GLOBAL WAVE LIMITED                )
in the presence of:                )

SIGNED by                          )
-                                  )      ....................................
duly authorised                    )
for and on behalf of               )
EARTHQUEST LIMITED                 )
in the presence of:                )

                                       13<Page>

EXHIBIT 10.13

                            STOCK PURCHASE AGREEMENT

       STOCK PURCHASE AGREEMENT, dated as of February 2, 2001 (this
"Agreement"), by and between BIZ INTERACTIVE ZONE, INC., a Delaware corporation
(the "Company"), and WAVE SYSTEMS CORP., a Delaware corporation ("Wave").

       WHEREAS, the Company and Wave have entered into (i) a certain Technology
Licensing and Authorization Agreement, dated August 18, 2000 and (ii) a certain
Purchase, Development, and Deployment Agreement, dated as of October 2, 2000;

       WHEREAS, the Company desires to issue and sell to Wave, and Wave desires
to purchase and acquire from the Company, shares of the Company's Series B
Preferred Stock, par value $0.001 per share (the "Series B Preferred Stock"),
having the rights, restrictions, privileges and preferences set forth in the
Third Amended and Restated Certificate of Incorporation to be filed with the
Secretary of State of Delaware in substantially the form attached hereto as
Exhibit A (the "Certificate of Incorporation"), on the terms and conditions set
forth in this Agreement; and

       WHEREAS, Wave desires to issue and sell to the Company, and the Company
desires to purchase and acquire from Wave, the Wave Payment Shares as defined in
Section 1.2 below, on the terms and conditions set forth in this Agreement and
the Payment and Registration Rights Agreement (as defined below).

       NOW, THEREFORE, the parties hereby agree as follows:

       1.     AGREEMENT TO PURCHASE AND SELL SHARES.

              1.1    AUTHORIZATION. As of the Closing (as defined below), the
Company will have authorized the issuance, pursuant to the terms and conditions
of this Agreement, of 3,600,000 shares of Series B Preferred Stock.

              1.2    AGREEMENT TO PURCHASE AND SELL. The Company agrees to issue
and sell to Wave at the Closing, and Wave agrees to purchase and acquire from
the Company at the Closing, 3,600,000 shares of Series B Preferred Stock in
exchange for 2,000,000 shares of Class A Common Stock, par value $0.01 per share
(the "Wave Payment Shares"), of Wave, to be issued to the Company pursuant to
the terms of the Payment and Registration Rights Agreement, dated as of the date
hereof (the "Payment and Registration Rights Agreement"), between the Company
and Wave, substantially in the form of Exhibit B attached hereto. The Series B
Preferred Stock purchased and sold pursuant to this Agreement will be
hereinafter referred to as the "Purchased Shares."

       2.     CLOSING. The closing of the purchase and sale of the Purchased
Shares (the "Closing") will take place at the offices of Bingham Dana LLP, at
399 Park Avenue, New York, New York 10022, or at such other place as the Company
and Wave shall mutually agree, concurrently with the execution of this Agreement
or at such other time as the Company and Wave shall mutually agree (the "Closing
Date"). At the Closing, the

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                                       -2-

Company will deliver to Wave a certificate representing the Purchased Shares in
exchange for delivery to the Company by Wave of a certificate representing the
Wave Payment Shares.

       3.     REPRESENTATIONS AND WARRANTIES OF THE COMPANY. The Company hereby
represents and warrants to Wave that, except as set forth in the Disclosure
Schedule ("Disclosure Schedule") attached to this Agreement as Exhibit C (which
Disclosure Schedule, when read together with this Section 3, shall be deemed to
be representations and warranties to Wave by the Company under this Section 3),
the statements in the following paragraphs of this Section 3 are all true and
complete as of the date of this Agreement (except to the extent any
representation or warranty speaks as of or is limited to an earlier date in
which case such representation or warranty shall be true and complete as of such
earlier date).

              3.1    ORGANIZATION, GOOD STANDING AND QUALIFICATION. The Company
has been duly incorporated and organized, and is validly existing in good
standing, under the laws of Delaware. The Company has the corporate power and
authority to enter into and perform this Agreement; the Payment and Registration
Rights Agreement; that certain Amended and Restated Stockholders' Agreement,
dated as of the date hereof by and among the Company, Wave and the other
stockholders of the Company, substantially in the form of Exhibit D attached
hereto (the "Stockholders' Agreement") and any other agreement ("Other
Agreement") to which the Company is a party, the execution and delivery of which
is contemplated hereby (this Agreement, the Payment and Registration Rights
Agreement, the Stockholders' Agreement and the Other Agreements are collectively
referred to as the "Operative Agreements"). Further, the Company has the
corporate power and authority to own and operate its properties and assets and
to carry on its business as currently conducted and as presently proposed to be
conducted.

              3.2    CAPITALIZATION. The authorized and issued capital stock of
the Company as of the Closing and immediately prior to the Closing will consist
of: 30,000,000 shares of Common Stock, par value $0.001 per share (the "Common
Stock") authorized, of which 16,400,000 shares are issued and outstanding and
7,000,000 shares of preferred stock authorized (the "Preferred"). Of the
Preferred, 1,051,128 shares have been designated as Series A Preferred Stock
(the "Series A Preferred Stock"), 187,970 shares of which are issued and
outstanding immediately prior to the Closing, and 3,600,000 shares have been
designated as Series B Preferred Stock, none of which are issued and outstanding
immediately prior to the Closing. All such issued and outstanding shares have
been duly authorized and validly issued, and are fully paid and nonassessable
and have been issued in compliance with all applicable state and federal laws
concerning the issuance of securities. The holders of record of the presently
issued and outstanding Common Stock and Series A Preferred Stock immediately
prior to the Closing are set forth in the Disclosure Schedule. There are no
options, rights, warrants or convertible securities to purchase or acquire from
the Company any of its shares of capital stock, other than the Purchased Shares
to be issued at Closing. Except as expressly provided in the Certificate of
Incorporation of the Company, this Agreement or the other Operative Agreements,
no holder of shares of Common Stock or any other security of the Company or any
other person is entitled to any preemptive right, right of first refusal or
similar right as a result of the issuance of the securities or otherwise, or any
voting trust, agreement or arrangement among any of the holders of voting stock
of the Company affecting the exercise of the voting rights of such stock.

<Page>
                                       -3-

              3.3    SUBSIDIARIES. The Company does not presently own or
control, directly or indirectly, any interest in any other corporation,
partnership, trust, joint venture, association or other entity.

              3.4    DUE AUTHORIZATION. All corporate action on the part of the
Company's directors and stockholders necessary for: (a) the authorization,
execution, delivery of, and the performance of all obligations of the Company
under this Agreement and the other Operative Agreements; and (b) the
authorization, issuance, and delivery of all of the Purchased Shares being sold
under this Agreement has been taken or will be taken prior to the Closing. This
Agreement and the other Operative Agreements constitute and, when executed and
delivered, will constitute, valid and legally binding obligations of the
Company, enforceable in accordance with their respective terms, except as may be
limited by (i) applicable bankruptcy, insolvency, reorganization or others laws
of general application relating to or affecting the enforcement of creditors'
rights generally and (ii) the effect of rules of law governing the availability
of equitable remedies.

              3.5    VALID ISSUANCE OF STOCK. The Purchased Shares, when issued
and paid for as provided in this Agreement and the Payment and Registration
Rights Agreement will be duly authorized and validly issued, fully paid and
nonassessable. The Common Stock issuable upon conversion of the Purchased Shares
has been duly and validly reserved for issuance and, upon issuance in accordance
with the terms of the Certificate of Incorporation will be duly authorized,
validly issued and nonassessable.

              3.6    GOVERNMENTAL CONSENTS. No consent, approval, order or
authorization of, or registration, qualification, designation, declaration or
filing with, any governmental authority is required on the part of the Company
in order to enable the Company to execute, deliver and perform its obligations
under this Agreement and the other Operative Agreements, except for filings
required under applicable state securities laws which filings will be effected
by the Company within the applicable time periods.

              3.7    LITIGATION. There is no action, suit, proceeding, claim,
arbitration or investigation pending (or, to the Company's knowledge, currently
threatened) against the Company, its activities, properties or assets or, to the
Company's knowledge, against any officer, director or employee of the Company in
connection with such officer's, director's or employee's relationship with, or
actions taken on behalf of, the Company. The Company has no knowledge or belief
that: there is pending or threatened any claim or litigation against the Company
contesting its right to transact its business as it is currently conducted and
currently proposed to be conducted; or there exists, or there is pending or
planned, any patent, invention, device, application or principle, or any
statute, rule, law, regulation standard or code which would materially adversely
affect the condition, financial or otherwise, or the operations of the Company.

              3.8    PROPRIETARY RIGHTS AND CONFIDENTIALITY AGREEMENT. Each
employee of the Company has, prior to the Closing, entered into and executed a
Proprietary Information and Inventions Agreement in the form attached hereto as
Exhibit E. The Company, to its knowledge is not aware that any of its employees,
officers or consultants are or will be in violation of any proprietary rights,
confidentiality or employment agreements entered into by such employee, officer
or consultant and the Company.

<Page>
                                       -4-

              3.9    STATUS OF PROPRIETARY ASSETS.

                     (A)   STATUS. The Company has full title and ownership of,
or is duly licensed under or otherwise authorized to use, to the Company's
knowledge (without having conducted a special investigation or patent search)
all patents, patent applications, trademarks, service marks, trade names,
copyrights, domain names, trade secrets, confidential and proprietary
information, designs and proprietary rights (all of the foregoing collectively
hereinafter referred to as the "Proprietary Assets"), used in its business as
now conducted without any material conflict with or infringement of the rights
of others. The Disclosure Schedule sets forth all of the Company's Proprietary
Assets. The Company has not received any written notice or claim of, nor does it
have any knowledge of, any infringement or misappropriation by the Company of
the asserted rights of others. The Company is not aware of any infringement or
misappropriation by others of its Proprietary Assets. The Company has taken all
reasonable steps necessary or appropriate to establish and maintain its
ownership of its Proprietary Assets. The Company is not aware that any of its
employees is obligated under any contract or other agreement, or subject to any
judgment, decree or order of any court or administrative agency, that would
interfere with the use of his or her best efforts to promote the interests of
the Company or that would conflict with the Company's business as currently
proposed to be conducted. The Company does not believe it is or will be
necessary to utilize any inventions, trade secrets or proprietary information of
any of its employees made prior to their employment by the Company, except for
inventions, trade secrets or proprietary information that have been assigned to
the Company.

                     (B)   LICENSES; OTHER AGREEMENTS. Except as set forth in
the Disclosure Schedule, the Company has not granted, and, to the Company's
knowledge, there is not outstanding, any options, licenses or agreements of any
kind relating to any Proprietary Asset of the Company, nor is the Company bound
by or a party to any option, license or agreement of any kind with respect to
any of its Proprietary Assets. The Company is not obligated to pay any royalties
or other payments to third parties with respect to the marketing, sale,
distribution, manufacture, license or use of any Proprietary Asset or any other
property or rights.

              3.10   COMPLIANCE WITH LAW AND DOCUMENTS. The Company is not in
violation or default of any provisions of its Certificate of Incorporation, as
amended, and to the Company's knowledge, except for any violations that
individually and in the aggregate would have no material adverse impact on the
Company's business, the Company is in compliance with all applicable statutes,
laws, regulations and executive orders and with all governmental bodies and
agencies having jurisdiction over the Company's business or properties. The
Company has not received any written notice of any violation of any such
statute, law, regulation or order which has not been remedied prior to the date
hereof. The execution, delivery and performance of this Agreement and the other
Operative Agreements and the consummation of the transactions contemplated
hereby or thereby will not result in any such violation or default, or be in
conflict with or result in a violation or breach of, with or without the passage
of time or the giving of notice or both, the Company's Certificate of
Incorporation, any judgment, order or decree of any court or arbitrator to which
the Company is a party or is subject, any agreement or contract of the Company,
or, to the Company's knowledge, a violation of any statute, law, regulation or
order, or an event which results in the creation of any lien, charge or
encumbrance upon any asset of the Company.

<Page>
                                       -5-

              3.11   RELATED-PARTY TRANSACTIONS. No employee, officer or
director of the Company or member of his or her immediate family is indebted to
the Company, nor is the Company indebted (or committed to make loans or extend
or guarantee credit) to any of them. To the Company's knowledge, none of such
persons has any direct or indirect ownership in any firm or corporation with
which the Company is affiliated or with which the Company has a business
relationship, or any firm or corporation that competes with the Company, except
that employees, officers or directors of the Company and members of their
immediate families may own stock in publicly traded companies that may compete
with the Company. To the Company's knowledge, no officer or director or any
member of their immediate families is, directly or indirectly, interested in any
material contract with the Company.

              3.12   PERMITS. The Company has obtained all franchises, permits,
licenses and any similar authority necessary for the conduct of its business as
now being conducted by it, the lack of which could materially and adversely
affect the business, properties or financial condition of the Company and
believes it can obtain, without undue burden or expense, any similar authority
for the conduct of its business as planned to be conducted. The Company is not
in default in any material respect under any of such franchises, permits,
licenses or other similar authority.

              3.13   REGISTRATION RIGHTS AND OTHER SHAREHOLDER RIGHTS. Except as
provided in the Stockholders' Agreement, the Company is not under any obligation
to register under the Securities Act, any of its currently outstanding
securities or any securities issuable upon exercise or conversion of its
currently outstanding securities nor is the Company obligated to register or
qualify any such securities under the securities laws of any state of the United
States. To the best of the Company's knowledge, except as set forth in the
Stockholders' Agreement and Certificate of Incorporation, no voting or similar
agreements exist related to the Company's securities which are presently
outstanding.

              3.14   TITLE TO PROPERTY AND ASSETS. The properties and assets the
Company owns are owned by the Company free and clear of all mortgages, deeds of
trust, liens, encumbrances and security interests except for statutory liens for
the payment of current taxes that are not yet delinquent and liens, encumbrances
and security interests which arise in the ordinary course of business and which
do not affect material properties and assets of the Company.

              3.15   FINANCIAL STATEMENTS. The Company has furnished Wave its
unaudited balance sheet as at September 30, 2000 (the "Balance Sheet") and
unaudited profit and loss statement, statement of stockholders' equity and
statement of cash flows as at and for the nine month period ended September 30,
2000 (the "Financial Statements"). The Financial Statements have been prepared
in accordance with generally accepted accounting principles applied on a
consistent basis throughout the periods indicated, except that the Financial
Statements may not contain all footnotes required by generally accepted
accounting principles. The Financial Statements fairly present the financial
condition and operating results of the Company as of the dates and for the
periods indicated. Since September 30, 2000, there has been no material adverse
change in the business, condition (financial or otherwise), or results of
operation of the Company, other than changes occurring in the ordinary course of
business (which ordinary changes have not, individually or in the aggregate,
been material). The projections of the Company for the period from January 1,
2000 through December 31, 2001 attached hereto as Exhibit F have been

<Page>
                                       -6-

prepared in good faith on the basis of reasonable assumptions and the Company
has no reason to believe that they are incorrect or misleading in any material
respect.

              3.16   TAX RETURNS, PAYMENTS AND ELECTIONS. The Company has filed
all tax returns and reports required by law to be filed by the Company. These
returns and reports are true and correct in all material respects. The Company
has paid all taxes and other assessments due, except those contested by it in
good faith which are listed in the Disclosure Schedule. The provision for taxes
of the Company is adequate for taxes due or accrued as of the date thereof. The
Company has not elected pursuant to the Internal Revenue Code of 1986, as
amended (the "Code"), to be treated as an S corporation, nor has it made any
other elections pursuant to the Code (other than elections which relate solely
to methods of accounting, depreciation or amortization) which would have a
material adverse effect on the Company, its financial condition, its business as
presently conducted or currently proposed to be conducted or any of its material
properties or material assets. The Company has never had a tax audit or a tax
deficiency proceeding and the Company has made all withholdings or collections
for all taxes, including, without limitation, federal and state income taxes,
and federal and state unemployment taxes, of its employees. The Company is not
and has not been delinquent in the payment of any tax, assessment or
governmental charge other than with respect to those contested by the Company in
good faith which are listed in the Disclosure Schedule. The Company has never
had any tax deficiency proposed or assessed against it and has not executed any
waiver of any statute of limitations on the assessment or collection of any tax
or governmental charge which had a material adverse effect on the financial
condition of the Company. None of the Company's federal income tax returns nor
any state income or franchise tax returns have ever been audited by governmental
authorities.

              3.17   ABSENCE OF MATERIAL LIABILITIES. The Company has no
liabilities, obligations or indebtedness (whether accrued, absolute, contingent,
liquidated or otherwise, whether due or to become due) except: (i) those
liabilities reflected and provided for on the Balance Sheet; (ii) those fully
described and listed on the Disclosure Schedule; and (iii) those incurred by the
Company in the ordinary course of its business since and which do not in the
aggregate exceed $5,000, which, in both cases, individually or in the aggregate,
are not material to the financial condition or operating results of the Company.

              3.18   INSURANCE. The Disclosure Schedule sets forth the following
information with respect to each insurance policy (including policies providing
property, casualty, liability and workers' compensation coverage and bond and
surety arrangements) to which the Company has been a party, a named insured or
otherwise the beneficiary of coverage:

                     (i)   the name, address and telephone number of the agent;
and

                     (ii)  the  name of the  insurer,  the name of the
policyholder  and the name of each covered insured.

       Such insurance policies provide adequate coverage for, in the Company's
belief, all normal risks incident to the business of the Company and its
properties and assets.

              3.19   CONTRACTS. Except as set forth in this Agreement or any of
the Operative Agreements, and as disclosed in the Disclosure Schedule, the
Company currently

<Page>
                                       -7-

has no existing written contract, obligation, agreement, plan, arrangement,
commitment or the like of any material nature, including, without limitation,
the following:

                     (i)   employment, bonus, pension, profit sharing, deferred
compensation, stock bonus, retirement, stock option, stock purchase, phantom
stock or similar plans, including agreements evidencing rights to purchase
securities of the Company and agreements among the Company's stockholders and
the Company;

                     (ii)  loan agreements, notes, indentures or instruments
relating to or evidencing indebtedness for borrowed money, or mortgaging,
pledging or granting or creating a lien or security interest or other
encumbrance on any of the Company's property or any agreement or instrument
evidencing any guaranty by the Company of payment or performance by any other
person;

                     (iii) agreements with dealers, sales representatives,
brokers or other distributors, advertisers or sales agencies;

                     (iv)  agreements with any labor union or collective
bargaining organization or other labor agreements;

                     (v)   any contract or series of contracts with the same
person for the furnishing or purchase of machinery, equipment, goods or
services, including, without limitation, agreements with equipment lessors,
processors, subcontractors, consultants and developers;

                     (vi)  any joint venture contract or arrangement or other
agreement involving a sharing of profits or expenses or pursuant to which the
Company has granted rights to manufacture, produce, assemble, license, market or
sell its products to any other person or that affects the Company's exclusive
rights to develop, manufacture, assemble, distribute and sell its products and
services;

                     (vii) agreements limiting the ability of the Company to
compete in any line of business or in any geographic area or with any person;

                     (viii) agreements providing for disposition of the
business, assets or shares of capital stock of the Company (other than provided
for herein), agreements of merger or consolidation to which the Company is a
party or letters of intent with respect to any of the foregoing;

                     (ix)  letters of intent or agreements with respect to the
acquisition of the business, assets or shares of any other business;

                     (x)   agreements for the purchase of material fixed assets
or for the purchase of materials, supplies or equipment in excess of normal
operating requirements;

                     (xi)  agreements granting any preemptive right, right of
first refusal or similar right to any person;

                     (xii) agreements obligating the Company to pay any royalty
or similar charge for use or exploitation of any tangible or intangible
property;

<Page>
                                       -8-

                     (xiii)covenants not to compete or other restriction on the
Company's ability to conduct its business or engage in any other activity; and

                     (xiv) other agreements not made in the ordinary course of
business that are material to the Company.

       The Company has complied with all the material provisions of all said
contracts, obligations, agreements, plans, arrangements and commitments set
forth in the Disclosure Schedule and is not in default in any material respect
thereunder. The Company has provided Wave with true and complete copies of each
of the contracts, agreements, plans, arrangements and other documents referred
to on the Disclosure Schedule.

              3.20   DISCLOSURE. No representation, warranty or statement by the
Company in this Agreement, or in any exhibit, schedule, statement or certificate
furnished to Wave pursuant to this Agreement, when read as a whole, contains any
untrue statement of a material fact or omits to state a material fact necessary
to make the statements made herein, in light of the circumstances under which
they were made, not misleading. Without limiting the generality of the
foregoing, except as set forth on the Disclosure Schedule, the Company is not
aware of any transaction with a reasonable likelihood of being completed that
would have a material impact on the business, operations or corporate structure
of the Company. It is the understanding of the parties that the disclosure of
any potential transaction on the Disclosure Schedule shall not, to the extent
that Wave has approval or consent rights pursuant to the Operative Agreements,
the Certificate of Incorporation, applicable law or otherwise, constitute
consent to or approval of any such transaction by Wave.

              3.21   [Intentionally Deleted]

              3.22   EMPLOYEE BENEFIT PLANS.

              (a)    The Company has set forth on the Disclosure Schedule (i)
all employee benefit plans, (ii) bonus, option, purchase, incentive, deferred
compensation, supplemental retirement, severance and other similar plans and
(iii) unexpired severance agreements, written or otherwise for the benefit of,
or relating to, any current or former employee of the Company (the "Company
Employee Plan"). The Company has performed in all material respects all
obligations required to be performed by it under each Company Employee Plan and
each Company Employee Plan has been established and maintained in all material
respects in accordance with its terms and with all applicable laws, statutes,
orders, rules and regulations, including but not limited to the Employee
Retirement Income Security Act of 1974, as amended ("ERISA") or the Code.

              (b)    The Company is not a party to any oral or written (i)
agreement with any officer, manager or other key employee of the Company, the
benefits of which are contingent, or the terms of which are materially altered,
upon the occurrence of a transaction involving the Company of the nature
contemplated by this Agreement, (ii) agreement with any officer or manager of
the Company providing any term of employment or compensation guarantee or for
the payment of compensation in excess of $150,000 per annum (excluding the grant
of stock options), or (iii) agreement or plan, including any option plan,
appreciation plan, or purchase plan, any of the benefits of which will be
increased, or the vesting of the benefits of which will be accelerated, by the
occurrence of any of the transactions contemplated by this Agreement or the
value of any of the benefits

<Page>
                                       -9-

of which will be calculated on the basis of any of the transactions contemplated
by this Agreement.

       4.     REPRESENTATIONS,  WARRANTIES  AND  CERTAIN  AGREEMENTS  OF  WAVE.
Wave  hereby represents and warrants to the Company that:

              4.1    PURCHASE FOR OWN ACCOUNT. The Purchased Shares to be
purchased by Wave hereunder will be acquired for investment for Wave's own
account, not as a nominee or agent, and not with a view to the public resale or
distribution thereof, and Wave has no present intention of selling, granting any
participation in, or otherwise distributing the same. Wave also represents that
Wave has not been formed for the specific purpose of acquiring Purchased Shares.
By executing this Agreement, Wave further represents that Wave does not have any
contract, undertaking, agreement or arrangement with any person to sell,
transfer, or grant participation to a person, with respect to any of the
Purchased Shares.

              4.2    DISCLOSURE OF INFORMATION. Wave has received or has had
full access to all the information it considers necessary or appropriate to make
an informed investment decision with respect to the Purchased Shares to be
purchased by Wave under this Agreement. Wave further has had an opportunity to
ask questions and receive answers from the Company regarding the terms and
conditions of the offering of the Purchased Shares and to obtain additional
information necessary to verify any information furnished to Wave or to which
Wave had access. The foregoing, however, does not in any way limit or modify the
representations and warranties made by the Company in Section 3.

              4.3    INVESTMENT EXPERIENCE. Wave understands that the purchase
of the Purchased Shares involves substantial risk. Wave (a) has experience as an
investor in securities of companies in the development stage and acknowledges
that Wave is able to fend for itself, can bear the economic risk of Wave's
investment in the Purchased Shares and has such knowledge and experience in
financial or business matters that Wave is capable of evaluating the merits and
risks of this investment in the Purchased Shares and protecting its own
interests in connection with this investment, and/or (b) has a pre-existing
personal or business relationship with the Company and certain of its officers,
directors or controlling persons of a nature and duration that enables Wave to
be aware of the character, business acumen and financial circumstances of such
persons.

              4.4    ACCREDITED  INVESTOR  STATUS.  Wave  is an  "accredited
investor" within the meaning of Regulation D promulgated under the Securities
Act.

              4.5    RESTRICTED SECURITIES. Wave understands that the Purchased
Shares are characterized as "restricted securities" under the Securities Act
inasmuch as they are being acquired from the Company in a transaction not
involving a public offering and that under the Securities Act and applicable
regulations thereunder such securities may be resold without registration under
the Securities Act only in certain limited circumstances. In this connection,
Wave represents that Wave is familiar with Rule 144 of the U.S. Securities and
Exchange Commission (the "SEC"), as presently in effect, and understands the
resale limitations imposed thereby and by the Securities Act. Wave understands
that the Company is under no obligation to register any of the securities sold
hereunder except as provided in the Stockholders' Agreement. Wave understands
that no

<Page>
                                      -10-

public market now exists for any of the Purchased Shares and that it is
uncertain whether a public market will ever exist for the Purchased Shares.

              4.6    LEGENDS.  It is  understood  that the  certificates
evidencing  the  Purchased Shares will bear the legends set forth below:

       THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED
       UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR UNDER THE SECURITIES
       LAWS OF ANY STATE OF THE UNITED STATES. THESE SECURITIES ARE SUBJECT TO
       RESTRICTIONS ON TRANSFERABILITY AND RESALE AND MAY NOT BE TRANSFERRED OR
       RESOLD EXCEPT AS PERMITTED UNDER THE APPLICABLE FEDERAL AND STATE
       SECURITIES LAWS, PURSUANT TO REGISTRATION OR EXEMPTION THEREFROM.
       INVESTORS SHOULD BE AWARE THAT THEY MAY BE REQUIRED TO BEAR THE FINANCIAL
       RISKS OF THIS INVESTMENT FOR AN INDEFINITE PERIOD OF TIME. THE ISSUER OF
       THESE SECURITIES MAY REQUIRE AN OPINION OF COUNSEL IN FORM AND SUBSTANCE
       SATISFACTORY TO THE ISSUER TO THE EFFECT THAT ANY PROPOSED TRANSFER OR
       RESALE IS IN COMPLIANCE WITH ANY APPLICABLE SECURITIES LAWS.

       The legend set forth above shall be removed by the Company from any
certificate evidencing Purchased Shares upon delivery to the Company of an
opinion by counsel, reasonably satisfactory to the Company, that a registration
under applicable securities laws is at that time in effect with respect to the
legended security or that such security can be freely transferred in a public
sale without such a registration statement being in effect and that such
transfer will not jeopardize the exemption or exemptions from registration
pursuant to which the Company issued the Purchased Shares.

       5.     CONDITIONS TO WAVE'S OBLIGATIONS AT CLOSING. The obligations of
Wave under Sections 1 and 2 of this Agreement are subject to the fulfillment or
waiver, on or before the Closing, of each of the following conditions, the
waiver of which shall not be effective against Wave without notice by Wave to
the Company of such waiver, which notice may be given by written, oral or
telephone communication to the Company or its counsel:

              5.1    REPRESENTATIONS AND WARRANTIES TRUE. Each of the
representations and warranties of the Company contained in this Agreement and
the other Operative Agreements shall be true and complete in all material
respects except those representations and warranties that are qualified by
materiality which shall be true and correct in all respects on and as of the
Closing Date (except to the extent any such representation or warranty speaks as
of or is limited to an earlier date in which case such representation or
warranty shall be true and complete as of such earlier date) with the same
effect as though such representations and warranties had been made on and as of
the Closing Date.

              5.2    PERFORMANCE. The Company shall have performed and complied
with all agreements, obligations and conditions contained in this Agreement that
are required to be performed or complied with by it on or before the Closing and
shall have

<Page>
                                      -11-

obtained all approvals, consents and qualifications necessary to complete the
purchase and sale described herein.

              5.3    COMPLIANCE CERTIFICATE. The Company shall have delivered to
Wave at the Closing a certificate signed on its behalf by its President, Chief
Executive Officer or Chief Financial Officer certifying that the conditions
specified in Sections 5.1 and 5.2 above have been fulfilled and stating that
there shall have been no material adverse change in the business, affairs,
operations, properties, assets or condition of the Company not previously
disclosed to Wave in writing.

              5.4    SECURITIES EXEMPTIONS. The offer and sale of the Purchased
Shares to the Wave pursuant to this Agreement shall be exempt from the
registration requirements of the Securities Act and the registration and/or
qualification requirements of all applicable state securities laws.

              5.5    PROCEEDINGS AND DOCUMENTS. All corporate and other
proceedings in connection with the transactions contemplated at the Closing and
all documents incident thereto shall be reasonably satisfactory in form and
substance to Wave, and Wave shall have received all such counterpart originals
and certified or other copies of such documents as it may reasonably request.
Such documents shall include (but not be limited to) the following:

                     (a)   CERTIFIED  CHARTER  DOCUMENTS.  A copy of the
Certificate of Incorporation of the Company (as amended through the date of the
Closing), certified by the Secretary of the Company as a true and correct copy
thereof as of the Closing.

                     (b)   CORPORATE ACTIONS. A copy of the resolutions of the
Board of Directors and the stockholders of the Company providing for the
approval of this Agreement and the other Operative Agreements, the issuance of
the Purchased Shares and the other matters contemplated hereby, certified by the
Secretary of the Company to be true, complete and correct.

                     (c)   OPERATIVE AGREEMENTS. The Company shall have executed
and delivered the Stockholders' Agreement and the Payment and Registration
Rights Agreement and the Initial Stockholders (as defined in the Stockholders'
Agreement) shall have executed and delivered the Stockholders' Agreement.

              5.6    PROPRIETARY INFORMATION AND INVENTIONS AGREEMENT. The
Company and each of its employees shall have entered into and executed the
Company's Proprietary Information and Inventions Agreement in the form attached
hereto as Exhibit E.

              5.7    CERTIFICATE. The Company shall have delivered to Wave a
certificate representing the Purchased Shares to be purchased by Wave which
shall be issued in Wave's name.

       6.     CONDITIONS TO THE COMPANY'S OBLIGATIONS AT CLOSING. The
obligations of the Company to Wave under this Agreement are subject to the
fulfillment or waiver on or before the Closing of each of the following
conditions by Wave the waiver of which shall not be effective against the
Company without notice by the

<Page>
                                      -12-

Company to Wave of such waiver, which notice may be given by written, oral or
telephone communication to Wave or its counsel:

              6.1    REPRESENTATIONS AND WARRANTIES. Each of the representations
and warranties of Wave contained in this Agreement and the other Operative
Agreements shall be true and complete in all material respects except those
representations and warranties set forth in Section 4 hereof and those
representations and warranties that are qualified by materiality which shall be
true and correct in all respects on and as of the Closing Date (except to the
extent any such representation or warranty speaks as of or is limited to an
earlier date in which case such representation or warranty shall be true and
complete as of such earlier date) with the same effect as though such
representations and warranties had been made on and as of the date of the
Closing Date.

              6.2    PERFORMANCE. Wave shall have performed and complied with
all agreements, obligations and conditions contained in this Agreement and the
other Operative Agreements that are required to be performed or complied with by
it on or before the Closing and shall have obtained all approvals, consents and
qualifications necessary to complete the purchase and sale described herein.

              6.3    COMPLIANCE CERTIFICATE. Wave shall have delivered to the
Company at the Closing a certificate signed on its behalf by its President,
Chief Executive Officer or Chief Financial Officer certifying that the
conditions specified in Sections 6.1 and 6.2 above have been fulfilled and
stating that there shall have been no material adverse change in the business,
affairs, prospects, operations, properties, assets or condition of Wave not
previously disclosed to the Company in writing.

              6.4    PROCEEDINGS AND DOCUMENTS. All corporate and other
proceedings in connection with the transactions contemplated at the Closing and
all documents incident thereto shall be reasonably satisfactory in form and
substance to the Company, and the Company shall have received all such
counterpart originals and certified or other copies of such documents as it may
reasonably request, including, without limitation, a copy of the resolutions of
the Board of Directors of Wave providing for the approval of this Agreement and
the other Operative Agreements, the acquisition of the Purchased Shares, the
issuance of the Wave Payment Shares and the other matters contemplated hereby
and thereby, certified by the Secretary of Wave to be true, complete and
correct.

              6.5    WAVE PAYMENT  SHARES. Wave shall have delivered to the
Company a certificate representing the Wave Payment Shares which shall be issued
in the Company's name.

              6.6    SECURITIES EXEMPTIONS. The offer and sale of the Purchased
Shares to the Wave pursuant to this Agreement shall be exempt from the
registration requirements of the Securities Act and the registration and/or
qualification requirements of all applicable state securities laws.

              6.7    OPERATIVE AGREEMENTS. Wave shall have executed and
delivered the Stockholders' Agreement and the Payment and Registration Rights
Agreement.

              6.8    PROCEEDINGS AND DOCUMENTS. All corporate and other
proceedings in connection with the transactions contemplated at the Closing and
all documents incident

<Page>
                                      -13-

thereto shall be reasonably satisfactory in form and substance to the Company
and to the Company's legal counsel, and the Company shall have received all such
counterpart originals and certified or other copies of such documents as it may
reasonably request.

       7.     GENERAL PROVISIONS.

              7.1    SURVIVAL OF WARRANTIES. The representations, warranties,
covenants and agreements made herein shall survive any investigation made by
Wave and the Closing of the transactions contemplated hereby.

              7.2    SUCCESSORS AND ASSIGNS. Except as otherwise expressly
provided herein, the provisions hereof shall inure to the benefit of, and be
binding upon, the successors, assigns, heirs, executors and administrators of
the parties.

              7.3    GOVERNING LAW. THE VALIDITY, CONSTRUCTION AND PERFORMANCE
OF THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED AND INTERPRETED IN
ACCORDANCE WITH, THE LAWS OF THE STATE OF DELAWARE, APPLICABLE TO CONTRACTS
EXECUTED IN AND PERFORMED ENTIRELY WITHIN SUCH STATE, WITHOUT REFERENCE TO ANY
CHOICE OF LAW PRINCIPLES OF SUCH STATE. WITH RESPECT TO ANY LEGAL PROCEEDING
ARISING OUT OF THIS AGREEMENT, ANY OF THE OTHER OPERATIVE AGREEMENTS OR ANY
TRANSACTION, THE PARTIES EXPRESSLY WAIVE ANY RIGHT THEY MAY HAVE TO A JURY TRIAL
AND AGREE THAT ANY SUCH LEGAL PROCEEDING SHALL BE TRIED BY A JUDGE WITHOUT A
JURY.

              7.4    COUNTERPARTS. This Agreement may be executed in any number
of counterparts, including facsimile copies, each of which shall be an original,
but all of which together shall constitute one instrument.

              7.5    TITLES AND SUBTITLES. The titles of the sections and
subsections of this Agreement are for convenience of reference only and are not
to be considered in construing this Agreement.

              7.6    NOTICES, ETC. Except as expressly provided herein, notices
and other communications provided for herein shall be in writing and shall be
delivered by hand or overnight courier service, mailed or sent by telecopier, as
follows:

       (a)    If to Wave:

              Wave Systems Corp.
              480 Pleasant Street
              Suite A-200
              Lee, MA 01238
              Attn:  Gerard Feeney
                     Chief Financial Officer
              Facsimile No.: (413) 243-0045

<Page>
                                      -14-

              With a copy to:

              Bingham Dana LLP
              399 Park Avenue
              New York, NY 10022
              Attn:  Neil Townsend
              Facsimile No.: (212) 752-5378

       (b)    If to the Company,

              Biz Interactive Zone, Inc.
              2030 Main Street
              Irvine, CA 92614
              Attn:  Chief Executive Officer
              Facsimile No.: (949) 655-4501

              With a copy to:

              Gray Cary Ware & Freidenrich LLP
              4365 Executive Drive, Suite 1600
              San Diego, CA 92121-2189
              Attn:  Rebecca K. Schmitt
              Facsimile No.: (858) 677-1477

       or to such other address or attention of such other person as any party
shall advise the other party in writing. All notices and other communications
given to a party hereto in accordance with the provisions of this Agreement
shall be deemed to have been given on the date of receipt.

       7.7    EXPENSES. If any action at law or in equity is necessary to
enforce or interpret the terms of this Agreement, the prevailing party shall be
entitled to reasonable attorneys' fees, costs and necessary disbursements in
addition to any other relief to which each party may be entitled.

       7.8    ENTIRE AGREEMENT; AMENDMENT. This Agreement and the Operative
Agreements delivered pursuant hereto constitute the full and entire
understanding and agreement between the parties with regard to the subjects
hereof and thereof and supersede all prior agreements, oral or written, and all
other communications between the parties relating to the subject matter hereof.
Any term of this Agreement may be amended and the observance of any term of this
Agreement may be waived (either generally or in a particular instance and either
retroactively or prospectively), only with the written consent of the Company
and Wave.

       7.9    SEPARABILITY OF THIS AGREEMENT. In case any provision of this
Agreement shall be invalid, illegal or unenforceable, the validity, legality and
enforceability of the remaining provisions shall not in any way be affected or
impaired thereby.

       8.     LITRONIC TRANSACTION

                  (a) Anything to the contrary set forth in this Agreement, the
other Operative Agreements, the Certificate of Incorporation of the Company or
otherwise notwithstanding, if, at any time commencing on the Closing Date and
ending on the first anniversary of the Closing Date, the Company, whether
directly or through one or more of its subsidiaries or stockholders, enters
into, commits to enter into or is otherwise involved in a Litronic Transaction,
then, upon the closing of such transaction and after giving effect thereto:

<Page>
                                      -15-

                     (i)   except as  required  by clause  (ii)  below,  Wave
shall receive in respect of its shares in the Company consideration that is
identical, on a share for share basis, to the consideration received by all
other stockholders of the Company in respect of their shares in the Company; and

                     (ii)  immediately  after  the  consummation  of the
Litronic Transaction, Wave shall hold, in the aggregate (including the shares
received in connection with clause (i) above), 13.78% of the Fully-Diluted
Shares of the combined or surviving entity (the "Combined Entity"), and shall
immediately be issued additional shares by the Combined Entity without
additional consideration so that, after giving effect to issuance of such
additional shares, Wave holds such percentage of the Fully-Diluted Shares.

As used herein, (A) "Fully-Diluted Shares" means the total outstanding shares of
common stock of the Combined Entity, determined on a fully-diluted basis
assuming (without duplication) the exercise or conversion of all options,
warrants (excluding that certain warrant to purchase 400,000 shares of the
Company's common stock issued to Litronic on July 31, 2000) and all other
securities convertible into or otherwise issuable for common stock that are
outstanding immediately upon the consummation of the Litronic Transaction or
that are contemplated to be issued thereafter in connection with the Litronic
Transaction or the employment, retention, non-compete or bonus arrangements
related thereto, (B) "Litronic" means Litronic Inc., a Delaware corporation, (C)
"Litronic Transaction" means any acquisition, disposition, share transfer, swap
or exchange, merger or consolidation, reorganization or recapitalization,
investment or similar transaction or series of transactions directly or
indirectly involving the Company or one of its subsidiaries or stockholders, on
the one hand, and Litronic or one of its subsidiaries or stockholders, on the
other hand, and, as a result of such transaction or transactions, all or
substantially all of the assets, securities or business of one party or one or
more of its subsidiaries is acquired by the other party or one or more of its
subsidiaries.

              (b)    the Company will not, by amendment of its Certificate of
Incorporation or through any reorganization, transfer of assets, consolidation,
merger, dissolution, issue or sale of securities, execution of any agreement,
consummation of any transaction or any other voluntary action avoid or seek to
avoid the observance or performance of any of the terms of this Section 8, but
will at all times in good faith assist in the carrying out of all such terms and
the taking of all such action as may be necessary or appropriate in order to
protect the rights of Wave under this Section 8 against dilution or impairment.
As part of any Litronic Transaction, provision shall be made so that Wave shall
be entitled to receive the benefits of this Section 8 at the closing of such
Litronic Transaction. The Company shall not consummate any Litronic Transaction,
unless prior to the consummation thereof, the successor entity (if other than
the Company) resulting from such Litronic Transaction assumes by written
instrument (in form and substance reasonably satisfactory to Wave) the
obligation immediately to deliver the equity securities or other property or
assets in accordance with this Section 8.

              (c)    Wave hereby agrees and acknowledges that a Litronic
Transaction is not a Sale Event (as such term is defined in the Certificate of
Incorporation).

<Page>
                                      -16-

       9.     INDEMNIFICATION.

              The Company shall indemnify, defend and hold harmless Wave and
its officers, directors, employees, agents and representatives (collectively,
together with Wave, the "Indemnified Persons") from and against (i) any Loss in
connection with any Claim asserted by any third party resulting from or caused
by any transaction, event or condition arising from or relating to the
execution, delivery and performance by Wave or the Company of this Agreement or
any of the other Operative Agreements or the performance by the Company of any
of the transactions contemplated hereby or thereby (including, without
limitation, any Litronic Transaction) other than Claims asserted by third
parties in connection with (a) Wave's failure to perform its obligations under
this Agreement or any other Operative Agreement or (b) Wave's gross negligence
or fraud and (ii) the enforcement by Wave of any of its rights or remedies
hereunder, under any of the other Operative Agreements or under the Certificate
of Incorporation of the Company. As used herein, (a) "Claim" means any pending
or threatening claim, demand, cause of action, suit, litigation, investigation
or proceeding, whether or not Wave or the other applicable Indemnified Person is
a party thereto and (b) "Loss" means any loss, claim, damage, liability or
expense of any nature whatsoever (including, without limitation, reasonable
counsel fees and disbursements).

                        (SIGNATURES APPEAR ON NEXT PAGE)

<Page>
                                      -17-

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

       BIZ INTERACTIVE ZONE, INC.:         WAVE SYSTEMS CORP.:

       By:                                 By:
           ----------------------------        ----------------------------

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

                  [SIGNATURE PAGE TO STOCK PURCHASE AGREEMENT]

<Page>
                                      -18-

                                LIST OF EXHIBITS

       Exhibit A - Amended and Restated Certificate of Incorporation

       Exhibit B - Payment and Registration Rights Agreement

       Exhibit C - Disclosure Schedule

       Exhibit D - Amended and Restated Stockholders' Agreement

       Exhibit E - Proprietary Information and Inventions Agreement

       Exhibit F - Projections

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