Document:

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                                                                   Exhibit 10.12

                         The Middlefield Banking Company
                          Director Retirement Agreement

          This Agreement is made as of December 1, 2001, by and between The
Middlefield Banking Company, an Ohio-chartered bank located in Middlefield, Ohio
("Middlefield Bank") and Donald Villers (the "Director").

          To encourage the Director to remain a member of Middlefield Bank's
board of directors, Middlefield Bank is willing to provide retirement benefits
to the Director. Middlefield Bank will pay the benefits from its general assets.
None of the conditions or events included in the definition of the term "golden
parachute payment" that is set forth in section 18(k)(4)(A)(ii) of the Federal
Deposit Insurance Act [12 U.S.C. 1828(k)(4)(A)(ii)] and in Federal Deposit
Insurance Corporation Rule 359.1(f)(1)(ii) [12 CFR 359.1(f)(1)(ii)] exists or,
to the best knowledge of Middlefield Bank, is contemplated insofar as
Middlefield Bank is concerned.

                                    Agreement

          In consideration of the foregoing premises and other good and valuable
consideration, the receipt and acceptance of which are hereby acknowledged, the
Director and Middlefield Bank hereby agree as follows:

                                    Article 1
                                   Definitions

          Whenever used in this Agreement, the following words and phrases shall
have the meanings specified:

          1.1 "Accrual Balance" means the amount reflected in Schedule A of this
Agreement, which is the amount required by generally accepted accounting
principles to be accrued by Middlefield Bank to account for benefits that may
become payable to the Director under this Agreement.

          1.2 "Change in Control" means that any of the following events occur:

                    (a) Middlefield Banc Corp., the parent company of
          Middlefield Bank, merges into or consolidates with another
          corporation, or merges another corporation into Middlefield Banc
          Corp., and as a result less than a majority of the combined voting
          power of the resulting corporation immediately after the merger or
          consolidation is held by persons who were the holders of Middlefield
          Banc Corp.'s voting securities immediately before the merger or
          consolidation, or

                    (b) a report on Schedule 13D, Schedule TO, or another form
          or schedule (other than Schedule 13G), is filed or is required to be
          filed under Sections 13(d) or 14(d) of the Securities Exchange Act of
          1934, if the schedule discloses that the filing person or persons
          acting in concert has or have become the beneficial owner of 15% or
          more of a class of Middlefield Banc Corp.'s voting securities (but
          this clause (b) shall not apply to beneficial ownership of voting
          shares held by Middlefield Bank or another subsidiary of Middlefield
          Banc Corp. in a fiduciary capacity), or

                    (c) during any period of two consecutive years, individuals
          who constitute Middlefield Banc Corp.'s board of directors at the
          beginning of the two-year period cease for any reason to constitute at
          least a majority thereof; provided, however, that -- for purposes of
          this clause (c) -- each director who is first elected by the board (or
          first nominated by the board for election by stockholders) by a vote
          of at least two-thirds ( ) of the directors who were directors at the
          beginning of the period shall be deemed to have been a director at the
          beginning of the two-year period, or

                    (d) Middlefield Banc Corp. sells to a third party
          substantially all of Middlefield Banc Corp.'s assets. For purposes of
          this Agreement, sale of substantially all of Middlefield Banc Corp.'s
          assets includes sale of Middlefield Bank.

          1.3 "Code" means the Internal Revenue Code of 1986, as amended.
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          1.4 "Disability" means, if the Director is covered by a
Company-sponsored disability policy, total disability as defined in such policy,
without regard to any waiting period. If the Director is not covered by such a
policy, Disability means the Director suffers a sickness, accident or injury
that -- in the judgment of a physician satisfactory to Middlefield Bank --
prevents the Director from performing substantially all of the Director's normal
duties for Middlefield Bank. As a condition to receiving any Disability
benefits, Middlefield Bank may require the Director to submit to such physical
or mental evaluations and tests as Middlefield Bank's board of directors deems
appropriate.

          1.5 "Early Termination" means Termination of Service on or after
reaching age 55 but before Normal Retirement Age and after having served as a
director for at least five years (including each year of board service before
the Effective Date of this Agreement), but Early Termination does not include
Termination of Service as a result of death, Disability, or Termination for
Cause, or Termination of Service within 12 months after a Change in Control.

          1.6 "Early Termination Date" means the month, day and year in which
Early Termination occurs.

          1.7 "Effective Date" means December 1, 2001.

          1.8 "Normal Retirement Age" means the Director's 71st birthday.

          1.9 "Normal Retirement Date" means the later of the Normal Retirement
Age or Termination of Service.

          1.10 "Person" means an individual, corporation, partnership, trust,
association, joint venture, pool, syndicate, sole proprietorship, unincorporated
organization or other entity.

          1.11 "Plan Year" means each 12-month period from December 1 through
November 30.

          1.12 "Termination for Cause" is defined in Section 3.1 of this
Agreement.

          1.13 "Termination of Service" means that the Director ceases to be a
member of Middlefield Bank's board of directors for any reason whatsoever. If
the Director ceases to be a member of Middlefield Bank's board of directors but
continues to serve on the board of directors of Middlefield Banc Corp.,
Termination of Service shall be deemed to have occurred instead when the
Director ceases also to be a member of the board of directors of Middlefield
Banc Corp. For purposes of this Agreement, if there is a dispute over the
service status of the Director or the date of the Director's Termination of
Service, Middlefield Bank shall have the sole and absolute right to decide the
dispute, unless a Change in Control shall have occurred.

                                    Article 2
                                Lifetime Benefits

          2.1 Normal Retirement Benefit. Upon Termination of Service on or after
Normal Retirement Age, and provided the Director has served as a director of
Middlefield Bank for at least five years (including each year of board service
before the Effective Date of this Agreement), Middlefield Bank shall pay to the
Director the benefit described in this Section 2.1 instead of any other benefit
under this Agreement.

                    2.1.1 Amount of Benefit. The annual benefit under this
          Section 2.1 is an amount in cash equal to 25% of the final average
          annual board fees paid to the Director by Middlefield Bank in the
          three years preceding the director's retirement on the Normal
          Retirement Date. For this purpose, board fees include retainers and
          other regular fees paid or payable in cash for the Director's service
          on or attendance at meetings of the board of directors of Middlefield
          Bank and committees of the board of directors, including board fees
          that may be deferred under any plan for elective deferrals that may be
          adopted by Middlefield Bank in the future. If the Director is serving
          as Chairman of

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          the Board on the Normal Retirement Date, board fees shall also include
          any additional cash compensation paid or payable for service as
          Chairman of the Board. Board fees shall not include the value of
          non-cash compensation, the value of life insurance benefits or other
          fringe benefits, or expense reimbursement. In its sole discretion,
          Middlefield Bank's board of directors may increase the annual benefit
          under this Section 2.1.1, but it shall have no obligation to do so.
          Any increase shall require recalculation of Schedule A.

                    2.1.2 Payment of Benefit. Middlefield Bank shall pay this
          annual benefit to the Director in 12 equal monthly installments.
          Commencing the month after the Director's Normal Retirement Date, the
          benefit is payable on the first day of each month. The benefit shall
          be paid to the Director for 120 months.

                    2.1.3 Section 2.4 Has Priority Over Other Sections. The
          Director's entitlement to benefits arising out of Termination of
          Service within 12 months after a Change in Control shall be governed
          exclusively by Section 2.4, even if the Director reaches Normal
          Retirement Age within 12 months after the Change in Control.

          2.2 Early Termination Benefit. Provided the Director has reached age
55 and has served as a director for at least five years (including each year of
board service before the Effective Date of this Agreement), Middlefield Bank
shall pay to the Director the benefit described in this Section 2.2 for Early
Termination instead of any other benefit under this Agreement, except as
provided in Article 3.

                    2.2.1 Amount of Benefit. The benefit under this Section 2.2
          is the Early Termination Benefit set forth in Schedule A for the Plan
          Year ending immediately before the Early Termination Date (except
          during the first Plan Year, the benefit is the amount set forth for
          Plan Year 1). In its sole discretion, Middlefield Bank's board of
          directors may increase the benefit under this Section 2.2.1, but it
          shall have no obligation to do so. Any increase shall require
          recalculation of Schedule A.

                    2.2.2 Payment of Benefit. Middlefield Bank shall pay this
          annual benefit to the Director in 12 equal monthly installments.
          Commencing the month after the Director's Normal Retirement Age, the
          benefit is payable on the first day of each month. The benefit shall
          be paid to the Director for 120 months.

                    2.2.3 Section 2.4 Has Priority Over Other Sections. The
          Director's entitlement to benefits arising out of Termination of
          Service within 12 months after a Change in Control shall be governed
          exclusively by Section 2.4.

          2.3 Disability Benefit. If the Director terminates service because of
Disability before his or her Normal Retirement Age, Middlefield Bank shall pay
to the Director the benefit described in this Section 2.3 instead of any other
benefit under this Agreement, regardless of whether the Director has accrued
five years of service or has reached age 55.

                    2.3.1 Amount of Benefit. The benefit under this Section 2.3
          is the Accrual Balance for the Plan Year ending immediately before the
          date on which Termination of Service because of Disability occurred
          (except during the first Plan Year, the benefit is the Accrual Balance
          at the end of Plan Year 1). In its sole discretion, Middlefield Bank's
          board of directors may increase the benefit under this Section 2.3.1,
          but it shall have no obligation to do so. Any increase shall require
          recalculation of Schedule A.

                    2.3.2 Payment of Benefit. Middlefield Bank shall pay the
          benefit to the Director in a single lump sum within 3 days after the
          Director's Termination of Service.

                    2.3.3 Section 2.4 Has Priority Over Other Sections. The
          Director's entitlement to benefits arising out of Termination of
          Service within 12 months after a Change in Control shall be governed
          exclusively by Section 2.4, even if Termination of Service is a result
          of Disability occurring within 12 months after the Change in Control.

          2.4 Change in Control Benefit. Unless the Director's service
terminates under Article 3 of this Agreement, if the Director's service with
Middlefield Bank terminates within 12 months after a Change in Control,

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Middlefield Bank shall pay to the Director the benefit described in this Section
2.4 instead of any other benefit under this Agreement, regardless of whether the
Director has accrued five years of service or has reached age 55.

                    2.4.1 Amount of Benefit. The benefit under this Section 2.4
          is the Accrual Balance for the Plan Year ending immediately before the
          date on which Termination of Service occurs (except during the first
          Plan Year, the benefit is the Accrual Balance at the end of Plan Year
          1). In its sole discretion, Middlefield Bank's board of directors may
          increase the benefit under this Section 2.4.1, but it shall have no
          obligation to do so. Any increase shall require recalculation of
          Schedule A.

                    2.4.2 Payment of Benefit. Middlefield Bank shall pay this
          benefit to the Director in a single lump sum within 3 days after the
          Director's Termination of Service.

                    2.4.3 Section 2.4 Has Priority Over Other Sections. The
          Director's entitlement to benefits arising out of Termination of
          Service within 12 months after a Change in Control shall be governed
          exclusively by Section 2.4.

          2.5 Petition for Payment of Vested Normal Retirement Benefit, Vested
Early Termination Benefit or Vested Disability Benefit. A Director who is
entitled to the Normal Retirement Benefit provided by Section 2.1 or the Early
Termination Benefit provided by Section 2.2 may petition the board of directors
to have the Accrual Balance amount corresponding to that particular benefit paid
in a single lump sum after (a) deduction of any Normal Retirement Benefits or
Early Termination Benefits already paid and (b) addition of interest at the rate
of 7.5% on the Accrual Balance not yet paid for the period from Termination of
Service to payment of the lump sum amount. The board of directors shall have
sole and absolute discretion about whether to pay the remaining Accrual Balance
in a lump sum. If payment of the remaining Accrual Balance is paid in a lump
sum, Middlefield Bank shall have no further obligations under this Agreement.

          2.6 Payout of Normal Retirement Benefit or Early Termination Benefit
after a Change in Control. If a Change in Control occurs when the Director is
receiving benefits provided by Sections 2.1 or 2.2 of this Agreement,
Middlefield Bank shall pay the remaining benefits to the Director in a single
lump sum within three days after the Change in Control. The lump-sum payment
shall be an amount equal to the Schedule A Accrual Balance remaining unpaid.

          2.7 Contradiction in Terms of Agreement and Schedule A. Schedule A
attached hereto is incorporated by reference in this Agreement and made a part
hereof. But if there is a contradiction between the terms of this Agreement and
Schedule A concerning the amount due the Director under Article 2 hereof, the
amount of the benefit due the Director shall be determined by this Agreement
without regard to Schedule A.

          2.8 Medical Benefits. Provided health insurance coverage can be
obtained by Middlefield Bank on terms it, in its sole judgment, considers
commercially reasonable, Middlefield Bank shall obtain and maintain health
insurance coverage for the Director after Termination of Service for the
lifetime of the Director and the Director's surviving spouse.

          2.9 No Death Benefits. No benefits shall be payable under this
Agreement after the Director's death.

                                    Article 3
                               General Limitations

          3.1 Termination for Cause. Notwithstanding any provision of this
Agreement to the contrary, Middlefield Bank shall not pay any benefit under this
Agreement if Middlefield Banc Corp.'s board of directors or a duly authorized
committee of the board of directors determines at any time that the Director
will not be nominated by the board or committee for reelection as a Director of
Middlefield Banc Corp. after the expiration of his current term, or if the
Director is removed as a director of Middlefield Bank, in either case because of
the Director's --

                    (a) gross negligence or gross neglect of duties,

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                    (b) commission of a felony, or commission of a misdemeanor
          involving moral turpitude, or

                    (c) fraud, disloyalty, dishonesty, or willful violation of
          any law or significant policy of Middlefield Bank committed in
          connection with the Director's service and resulting in an adverse
          effect on Middlefield Bank or Middlefield Banc Corp.

          Middlefield Bank's board of directors or the duly authorized committee
of the board of directors shall have the sole and absolute right to determine
whether the bases set forth in this Section 3.1 for denial of benefits under
this Agreement exist. Benefits may be denied under this Section 3.1 regardless
of whether the Director continued to serve as a Director after the board or
committee made its determination not to nominate the Director for reelection,
and regardless of whether stockholders nominated the Director for reelection or
reelected the Director for an additional term.

          3.2 Removal. If the Director is removed from service or permanently
prohibited from participating in the conduct of Middlefield Bank's affairs by an
order issued under Section 8(e)(4) or (g)(1) of the Federal Deposit Insurance
Act [12 U.S.C. 1818(e)(4) or (g)(1)], all obligations of Middlefield Bank under
this Agreement shall terminate as of the effective date of the order.

          3.3 Insolvency. If the Superintendent of the Ohio Division of
Financial Institutions appoints a conservator or receiver for Middlefield Bank
under Ohio Revised Code chapter 1125, all obligations under this Agreement shall
terminate as of the date of such appointment.

                                    Article 4
                          Claims and Review Procedures

          4.1 Claims Procedure. Middlefield Bank shall notify in writing any
person or entity making a claim for benefits under this Agreement (the
"Claimant") of his or her eligibility or noneligibility for benefits under the
Agreement. Middlefield Bank shall send the written notice to the Claimant within
90 days after Claimant's written application for benefits. If Middlefield Bank
determines that the Claimant is not eligible for benefits or full benefits, the
notice shall state (a) the specific reasons for such denial, (b) a specific
reference to the provisions of the Agreement on which the denial is based, (c) a
description of any additional information or material necessary for the Claimant
to perfect his or her claim, and a description of why it is needed, and (d) an
explanation of the Agreement's claims review procedure and other appropriate
information concerning the steps to be taken if the Claimant wishes to have the
claim reviewed. If Middlefield Bank determines that there are special
circumstances requiring additional time to make a decision, Middlefield Bank
shall notify the Claimant of the special circumstances and the date by which a
decision is expected to be made, and may extend the time for up to an additional
90 days.

          4.2 Review Procedure. If Middlefield Bank determines that the Claimant
is not eligible for benefits, or if the Claimant believes that he or she is
entitled to greater or different benefits, the Claimant shall have the
opportunity to have the claim reviewed by Middlefield Bank by filing a petition
for review with Middlefield Bank within 60 days after receipt of the notice
issued by Middlefield Bank. The petition shall state the specific reasons the
Claimant believes entitle him or her to benefits or to greater or different
benefits. Within 60 days after receipt by Middlefield Bank of the petition,
Middlefield Bank shall give the Claimant (and counsel, if any) an opportunity to
present his or her position to Middlefield Bank verbally or in writing, and the
Claimant (or counsel) shall have the right to review the pertinent documents.
Middlefield Bank shall notify the Claimant of Middlefield Bank's decision in
writing within the 60-day period, stating specifically the basis of its decision
and identifying the specific provision(s) of the Agreement on which the decision
is based. If because of the need for a hearing the 60-day period is not
sufficient, the decision may be deferred for up to another 60 days at the
election of Middlefield Bank, but notice of this deferral shall be given to the
Claimant.

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                                    Article 5
                                  Miscellaneous

          5.1 Amendment and Termination. This Agreement may be amended or
terminated only by a written agreement signed by Middlefield Bank and the
Director.

          5.2 Binding Effect. This Agreement shall bind the Director and
Middlefield Bank, and their beneficiaries, survivors, executors, successors,
administrators and transferees.

          5.3 No Guarantee of Service. This Agreement is not a contract for
services. It does not give the Director the right to remain a Director of
Middlefield Bank, nor does the Agreement interfere with the rights of
Middlefield Bank's stockholder(s) not to re-elect the Director or the right of
the stockholder(s) or the board to remove an individual as a director of
Middlefield Bank. The Agreement also does not require the Director to remain a
director nor interfere with the Director's right to terminate service at any
time.

          5.4 Non-Transferability. Benefits under this Agreement cannot be sold,
transferred, assigned, pledged, attached, or encumbered in any manner.

          5.5 Successors; Binding Agreement. By an assumption agreement in form
and substance satisfactory to the Director, Middlefield Bank will require any
successor (whether direct or indirect, by purchase, merger, consolidation or
otherwise) to all or substantially all of the business or assets of Middlefield
Bank or Middlefield Banc Corp. to expressly assume and agree to perform this
Agreement in the same manner and to the same extent that Middlefield Bank would
be required to perform this Agreement if no such succession had occurred.
Failure of Middlefield Bank to obtain such assumption agreement before
effectiveness of such succession shall be a breach of this Agreement and shall
entitle the Director to the Change in Control Benefit provided in Section 2.4.

          5.6 Tax Withholding. Middlefield Bank shall withhold any taxes that
are required to be withheld from the benefits provided under this Agreement.

          5.7 Applicable Law. The Agreement and all rights hereunder shall be
governed by the internal substantive laws of the State of Ohio, without regard
to principles of conflict of laws.

          5.8 Unfunded Arrangement. The Director is a general unsecured creditor
of Middlefield Bank for the payment of benefits under this Agreement. The
benefits represent the mere promise by Middlefield Bank to pay such benefits.
The rights to benefits are not subject in any manner to anticipation,
alienation, sale, transfer, assignment, pledge, encumbrance, attachment, or
garnishment by creditors. Any insurance on the Director's life is a general
asset of Middlefield Bank to which the Director has no preferred or secured
claim.

          5.9 Entire Agreement. This Agreement constitutes the entire agreement
between Middlefield Bank and the Director as to the subject matter hereof. No
rights are granted to the Director by virtue of this Agreement other than those
specifically set forth herein.

          5.10 Administration. Middlefield Bank shall have powers which are
necessary to administer this Agreement, including but not limited to--

                    (a) Interpreting the provisions of the Agreement,

                    (b) Establishing and revising the method of accounting for
          the Agreement,

                    (c) Maintaining a record of benefit payments, and

                    (d) Establishing rules and prescribing any forms necessary
          or desirable to administer the Agreement.

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          5.11 Named Fiduciary. Middlefield Bank shall be the named fiduciary
and plan administrator under this Agreement. The named fiduciary may delegate to
others certain aspects of the management and operation responsibilities of the
plan including the employment of advisors and the delegation of ministerial
duties to qualified individuals.

          5.12 Severability. If for any reason any provision of this Agreement
is held invalid, such invalidity shall not affect any other provision of this
Agreement not held invalid, and each such other provision shall continue in full
force and effect to the full extent consistent with the law. If any provision of
this Agreement is held invalid in part, such invalidity shall in no way affect
the rest of such provision not held invalid, and the rest of such provision
together with all other provisions of this Agreement shall continue in full
force and effect to the full extent consistent with the law.

          5.13 Headings. The headings of Sections herein are included solely for
convenience of reference and shall not affect the meaning or interpretation of
any provision of this Agreement.

          5.14 Notices. All notices, requests, demands and other communications
hereunder shall be in writing and shall be deemed to have been duly given if
delivered by hand or mailed, certified or registered mail, return receipt
requested, with postage prepaid, to the following addresses or to such other
address as either party may designate by like notice.

          (a) If to Middlefield Bank, to: Board of Directors
                                          The Middlefield Banking Company
                                          15985 East High Street
                                          Middlefield Bank, Ohio  44062-9263

          (b) If to the Director, to:
                                          ----------------------------

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

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

and to such other or additional person or persons as either party shall have
designated to the other party in writing by like notice.

          In Witness Whereof, the Director and a duly authorized officer of
Middlefield Bank have signed this Agreement as of the day and year first written
above.

Director                                         The Middlefield Banking Company

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

                                                 Its:
                                                      --------------------------

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<PAGE>

                     Schedule A Dated as of January 8, 2002
          The Middlefield Banking Company Director Retirement Agreement

                                 Donald Villers

<TABLE>
<CAPTION>
                                                                                                          Benefit for Termination
                        Director's       Accrual Balance at       Disability        Early Termination       of Service within 12
        Plan year     Age at the end   7.5% Discount Rate at   Benefit, payable    Benefit, payable at    months after a Change in
Plan      ending        of the Plan     the end of the Plan      in a single        Normal Retirement      Control, payable in a
year   November 30,        Year               Year/(1)/           lump sum        Age for 10 Years/(2)/       single lump sum
----   ------------   --------------   ---------------------   ----------------   ---------------------   ------------------------
<S>      <C>                <C>               <C>                  <C>                   <C>                      <C>
 1         2002             69                $ 7,105              $ 7,105               $1,212                   $ 7,105

 2         2003             70                $14,761              $14,761               $2,338                   $14,761

 3         2004             71                $23,011              $23,011               $3,381                   $23,011

         May 2005           71/(3)/           $26,802              $26,802               $3,794                   $26,802
</TABLE>

(1)      The Accrual Balance assumes payment at the beginning of each month
          during retirement. Assumes retirement in May, 2005 after attaining the
          Normal Retirement Age of 71 and at least five years of service. The
          Accrual Balance assumes that the Director retires from director
          service in May, 2005 when his term as a director of Middlefield Banc
          Corp. expires at the 2005 Annual Meeting of Shareholders of
          Middlefield Banc Corp. The Normal Retirement Benefit is an amount in
          cash equal to 25% of the final average annual board fees in the three
          years preceding the director's retirement on the Normal Retirement
          Date. For purposes of illustration, the Normal Retirement Annual
          Benefit required by Agreement Section 2.1 is assumed to be $3,794,
          calculated as shown by the attached Director Fee Analysis. The Normal
          Retirement Benefit required by Agreement Section 2.1 is shown in this
          Schedule A solely for illustrative purposes. The actual Normal
          Retirement Benefit required by Agreement Section 2.1 will be
          determined pursuant to Agreement Section 2.1. Board fees include
          retainers and other regular fees paid or payable in cash for the
          Director's service on or attendance at meetings of the board of
          directors and committees of the board of directors, including elective
          deferrals. If the Director is serving as Chairman of the Board on the
          Normal Retirement Date, board fees also include any additional cash
          compensation paid or payable for service as Chairman of the Board.
          Estimated assuming annual board fee increases of 5.00% commencing in
          2002.
(2)       Early Retirement Benefits are payable if the Director has five years
          of service and has reached age 55.
(3)       The age shown is not the age at the end of the Plan Year, but instead
          is the Director's age at assumed retirement in May, 2005.

                                       8<PAGE>
                                                                   EXHIBIT 10.22

                   Dated                                April 30 2001

                                 LCC UK LIMITED

                                       AND

                                 CARLO BARAVALLE

                             CONTRACT OF EMPLOYMENT

                           Reed Smith Warner Cranston
                                 Pickfords Wharf

                                  Clink Street
                                     London

                                     SE1 9DG

                               Tel: 020 7403 2900
                               Fax: 020 7403 4221

                                    Ref: GHM

<PAGE>

THIS AGREEMENT is made the 30th day of April 2001

BETWEEN

(1) LCC UK LIMITED whose registered office is at 43 Crawford Street, London, W1H
1JR, United Kingdom ("the Company"); and

(2) CARLO BARAVALLE of ------------------------, Oxford, OX2 6LD, United Kingdom
("you/your").

1.   COMMENCEMENT OF EMPLOYMENT

     1.1  Your employment with the Company will begin on 14th of May 2001 ("the
          Start Date").

     1.2  Your continuous employment with the Company will begin on the Start
          Date. No employment with a previous employer will count as part of
          your continuous employment.

2.   JOB TITLE AND DUTIES

     2.1  You will be employed initially as Senior Vice-President of the Europe,
          Middle-East, Africa & Asia-Pacific region. LCC International intends
          to appoint, in the near future, a person who will take responsibility
          for Asia-Pacific, at which point your responsibility for business in
          that region will be reviewed and, may cease at the Company's option.
          You will report to the Chairman of the Board of directors of the
          Company, who is currently Tom Faulders ("your manager").

     2.2  In addition to the duties which this job normally entails, you may,
          from time to time, be required to undertake additional or other duties
          which are within your skill and competence and appropriate to your
          position as necessary to meet the needs of the Company's business.

     OTHER EMPLOYMENT

     2.3  During the course of your employment with the Company you must not
          engage in any other occupation or profession or business or work for
          any other company, firm or person without first obtaining written
          consent from your manager.

3.   REMUNERATION

     3.1  Your salary will be paid at a rate of Euro 310,000 per annum. Your
          salary will be reviewed annually, generally in January, but with no
          commitment to increase. Payment of this salary, and of all other sums
          expressed in this contract as Euro, will be paid to you in (a) British

                                       2
<PAGE>

          Pounds, for so long as you reside in the United Kingdom, at the
          exchange rate prevailing at the date when each respective payment
          falls due or (b) if you are not residing in the United Kingdom, Euros.

     3.2  Your salary will be paid monthly in arrears in twelve equal monthly
          installments in accordance with UK payroll practice from time to time
          by credit transfer into a bank or building society account nominated
          by you. They will be paid subject to such deductions, including but
          not limited to income tax, as the Company is required by law to make.

     3.3  You will be entitled to receive a signing on bonus of Euro 28,000,
          which will be paid at the same time as your first monthly salary
          payment. If, prior to the first anniversary of the Start Date, you
          resign your employment (except in the case of constructive dismissal),
          or are dismissed for one of the reasons set out in clause 9.4 below
          (excluding clauses 9.4.5 and 9.4.6), you will be required to repay
          such proportion of the said payment as represents the proportion of
          that first year of service which as you do not in fact serve. The
          Company may deduct any such repayment from monies owing to you,
          whether as salary or otherwise.

     3.4  You will be eligible to participate in the Company's Annual
          Performance Bonus plan. Details of the Plan are set out each year by
          LCC International and apply to employees in all LCC subsidiary
          companies, including in the Company. In respect of your period of
          service from your start date to 31 December 2001, you will be eligible
          to receive a bonus of up to a maximum of 50% of the base salary earned
          during that period; the amount due will be based on the extent to
          which individual and company goals are achieved. In respect of your
          service during 2001, you will be paid a bonus of at least 25% of the
          base salary earned during that period of service. In respect of
          service after 31st December 2001, there is no guaranteed minimum
          bonus. Bonuses are normally paid in the March immediately following
          the end of the relevant bonus year. No bonus is due if, prior to the
          payment date, you have resigned your employment (except in the case of
          constructive dismissal) or been dismissed for one of the reasons set
          out in clause 9.4 below (except for clauses 9.4.5 and 9.4.6). In the
          event that your employment terminates for any other reason, you will
          be entitled to be paid a bonus in respect of service during that part
          of the bonus year which occurs prior to the date when the employment
          terminates. Such bonus as may be due will be paid at the same time as
          for all other employees, which is ordinarily the March after the end
          of the bonus year.

                                       3
<PAGE>

     EXPENSES

     3.5  You will be reimbursed for business expenses properly incurred in the
          performance of your duties and in accordance with Company guidelines
          on submission of appropriate receipts.

     DEDUCTIONS FROM WAGES

     3.6  For the purposes of Part II of the Employment Rights Act 1996, you
          hereby authorise the Company to deduct from your salary any sums due
          from you to the Company, including without limitation any overpayment
          of salary or accrued holiday pay.

4.   PLACE OF WORK

     4.1  Your normal place of work will be at the Company's offices in London,
          UK.

     4.2  You will be required to travel on the business of the Company to such
          places as may be reasonably necessary for the proper performance of
          your duties, both inside and outside the UK; it is anticipated that
          such travel may be on a frequent and regular basis.

     4.3  It is agreed that you may relocate your family to Paris during the
          summer of 2002.

5.   HOURS OF WORK

     5.1  The Company's normal business hours are 8:30 a.m. to 5:00 p.m., Monday
          to Friday with a one hour break for lunch.

     5.2  You may be required to work additional hours to meet the needs of the
          Company's business. You will not be paid for any such additional
          hours.

     5.3  You agree that the maximum weekly working time set out in Regulation 4
          of the Working Time Regulations as amended will not apply in relation
          to your employment. You may decide at any time to opt back into the
          application of this limit and, if so, you must give the Company three
          months' written notice of your wish to do so.

6.   BENEFITS AND STOCK OPTIONS

     6.1  During your employment you will be entitled, at the Company's expense,
          to participate in the standard Benefit Programme which is offered to
          all UK based employees working in the EMEA & A-P region. The key
          benefits currently applicable to your contract are

                                       4
<PAGE>

          outlined in Annex 1, which the parties recognize is only a high-level
          outline of the company's current benefits and, as a result, such
          benefits are subject to whatever limitations, exclusions, requirements
          and other policy or plan provisions that may be set forth in the
          company's policies or the plan documents relating to each of the
          mentioned benefits. The Company reserves the right to modify or
          withdraw such benefits as and when it sees fit. It is expressly agreed
          that the provision of benefits under the Permanent Health Insurance
          scheme (if any) shall in no way limit or restrict the Company's rights
          under this agreement or otherwise to terminate your employment.

     6.2  You will receive a car allowance of Euro 1,650 per month, subject to
          applicable UK taxes.

     6.3  Subject to the provisions of this clause 6.3, the parties acknowledge
          that the Compensation and Stock Option Committee of the Board of
          Directors of LCC International, Inc. has, in anticipation of your
          commencing employment with the Company on or about May 14, 2001,
          granted you an option to purchase 100,000 shares of LCC International,
          Inc. Series A Common Stock under the LCC International, Inc. 1996
          Employee Stock Option Plan, as amended. The option exercise price was
          set at the time the option was granted on April 24, 2001, at US$5.64
          per share, which is the fair market value of the said shares at the
          date of the grant as defined in the relevant plan documents. The
          options expire in the event you do not commence employment with the
          Company on or before May 14, 2001. The options become exercisable in 5
          equal tranches of 20,000 shares each, on each of the first to the
          fifth anniversary of the date of the grant. In the event that your
          employment terminates, the status of unexpired options, and in
          particular whether or not they lapse, will be determined in accordance
          with the plan rules as applicable from time to time. Further, you will
          not be entitled to receive as compensation for loss of employment or
          otherwise, any payment in respect of the loss of the value of said
          options. Further the said options, and all rights in respect of them,
          will be subject such rules as the Company and LCC International, Inc
          may have established or will in future establish, and in particular,
          the terms of the LCC International, Inc. 1996 Employee Stock Option
          Plan, as amended, and the form of Non-Qualified Employee Stock Option
          Agreement adopted thereunder.

     6.4  Additionally, you will also be eligible to receive additional annual
          stock option grants in connection with your annual performance review
          to the extent the Board of LCC International, Inc., in its discretion

                                       5
<PAGE>

          decides to grant options to existing employees in general and to you
          in particular.

7.   HOLIDAY ENTITLEMENT

     7.1  Your annual holiday entitlement is 25 days per year. You are also
          entitled to paid holiday on all recognised bank or public holidays in
          London. The Company's holiday year is 1 January to 31 December.

     7.2  Holidays must be taken at times convenient to and agreed in writing by
          the Company and reasonable notice of your intention to take holiday
          must be given to your manager who will then confirm to you whether the
          requested dates are acceptable. No single period of leave may exceed
          ten working days without the express consent of your manager.

     7.3  The Company encourages employees to take all of their holiday
          entitlement in the relevant calendar year. If this is not possible,
          you will only be entitled to carry accrued but untaken holiday into
          the next holiday year with your manager's written consent. Such
          consent is at the manager's discretion, and normally no more than 5
          days can be carried forward.

     7.4  On the termination of your employment, outstanding holiday entitlement
          will be paid at 1/260th of annual salary for each day owing.
          Deductions from final salary due to you on the termination of your
          employment will be made in respect of any holidays taken in excess of
          accrued entitlement. The Company reserves the right to require you to
          take holidays during any period of notice.

8.   SICKNESS/INCAPACITY

     NOTIFICATION PROCEDURE

     8.1  If you are unable to work due to sickness or injury you must inform
          your manager no later than 10:00 a.m. on the first day of absence.

     8.2  You will be required to produce a self-certification form in respect
          of absences up to and including five working days. The Company
          reserves the right to require you to obtain a medical certificate in
          respect of any such period of absence.

     8.3  You must, on the 6th working day of any absence, provide the Company
          with a medical certificate stating the reason for the absence and
          thereafter provide a like certificate each week to cover any
          subsequent period of absence.

                                       6
<PAGE>

     8.4  The Company reserves the right to ask you to produce a medical
          certificate and/or to undergo a medical examination at any time during
          your absence subject to the provisions of the Access to Medical
          Reports Act 1988. The Company also reserves the right to withhold
          payment of sick pay, otherwise due in accordance with clauses 8.5 and
          8.6 below, in the event that you fail to comply with the requirements
          of clauses 8.1 to 8.4.

     SICK PAY

     8.5  The Company operates the Statutory Sick Pay Scheme and you are
          required to co-operate in the maintenance of necessary records. For
          the purpose of calculating your Statutory Sick Pay, "qualifying days"
          are Monday to Friday.

     8.6  You will be paid your full salary entitlement, less the amount of any
          Statutory Sick Pay or Social Security sickness benefit to which you
          may be entitled, for an aggregate of 60 working days in any
          consecutive 12 month period. Thereafter, any payment in excess of
          Statutory Sick Pay will be entirely at the Company's discretion.

9.   TERMINATION

     9.1  Either party may terminate your employment at any time by giving to
          the other not less than 6 months notice in writing.

     9.2  The Company reserves the right to terminate your employment without
          notice, or without full notice, and to make a payment in lieu of
          notice. The said payment in lieu of notice shall be of a sum equal to
          the sum of (i) your basic salary under clause 3.1, and (ii) a bonus
          payment under clause 3.4 calculated as if you had remained employed by
          the Company for the whole of your notice period and, as relevant, on
          the basis of a reasonable expectation of what your performance would
          have been had you remained employed by the Company for the whole of
          your notice period and a reasonable expectation of what the company's
          performance will be for the period in question, and (iii) car
          allowance, and (iv) an amount equal to the premiums which you would
          have to pay to provide yourself with the same life, accidental death
          and dismemberment, short and long term disability and health benefits
          from which you and your family were benefiting while you were an
          employee of the company, capped at two times the cost to the Company
          of such benefits, and (v) pension contributions for your benefit, and
          (vi) UK tax return benefit, in each case only to the extent of your
          entitlements. during the contractual notice period or part thereof had
          you remained an

                                       7
<PAGE>

          employee of the Company for the duration of the same. In the event
          that the Company does terminate your employment without notice or full
          notice, the Company shall be obliged to make a payment in lieu of
          un-expired notice only if it is, and states in writing that it is,
          acting pursuant to the contractual right created by the opening
          sentence of this clause 9.2. In such circumstances, the payment will
          be subject to tax. In the event that the Company does not make use of
          the said right, the termination will be regarded as being in breach of
          contract and the Company will be required to pay damages to you
          calculated in accordance with normal principles, including the rules
          relating to mitigation of loss.

     NO OBLIGATION TO PROVIDE WORK

     9.3  During any period of notice, or for the purpose of investigating any
          disciplinary matter, the Company reserves the right to require that
          you do not attend for work and/or do not undertake any or all of your
          duties. During such "garden leave", you will remain entitled to your
          normal pay and your duties to the Company of good faith,
          confidentiality and exclusive service will continue to apply.

     IMMEDIATE TERMINATION

     9.4  The Company reserves the right to terminate your employment without
          notice, and without any compensation or payment in lieu of notice, if
          you:

          9.4.1 are guilty of gross misconduct;

          9.4.2 commits or causes the Company to commit a serious breach of, or
               is negligent in failing to prevent a serious breach of, any law,
               rule or regulation applicable to the Company or LCC International
               including without limitation, the US Foreign and Corrupt
               Practices Act;

          9.4.3 except in the case where the breach is serious, having been
               given prior written notice of the breach and reasonable
               opportunity to rectify the same, fail to comply with any material
               provision of the Company's Corporate Standards of Conduct
               (including but not limited to the Company's policies on insider
               trading, use of confidential information, ethical standards,
               equal opportunities and discrimination);

          9.4.4 commit any act of dishonesty whether relating to the Company, an
               employee of the Company or otherwise;

                                       8
<PAGE>

          9.4.5 have an interim receiving order made against you or you are
               adjudged bankrupt or enter into any composition or arrangement
               with or for the benefit of your creditors including a voluntary
               arrangement under the Insolvency Act 1986; or

          9.4.6 become of unsound mind or are or become a patient for the
               purposes of any statute relating to mental health.

     RETIREMENT

     9.5  Your employment will automatically terminate on your 65th birthday.

     RETURN OF COMPANY PROPERTY

     9.6  On termination of employment for whatever reason you will immediately
          return to the Company in accordance with its instructions all
          equipment, confidential information (as described in clause 10.1),
          documents, reports, notes, correspondence and any copies thereof and
          any other property belonging to the Company or any Associated Company
          and which are in your possession or control.

10.  CONFIDENTIALITY

     10.1 You must not disclose to any person, firm or company, otherwise than
          in the proper course of your duties or with the written consent of the
          Company, any trade secret or information of a confidential nature
          concerning the business of the Company or any Associated Companies
          and/or of any client or prospective client including, but not limited
          to:

          10.1.1 any secret or confidential information concerning the business
               development, affairs, future plans, business methods,
               connections, customer lists, finances, processes, policies or
               practices or designs of the Company or any Associated Company or
               any of its suppliers, agents, distributors, clients or customers;

          10.1.2 any document or information marked as confidential on its face;
               or

          10.1.3 any document or information which has been supplied to you in
               confidence or which you have been informed is confidential or
               which you might reasonably be aware is confidential.

                                       9
<PAGE>

     10.2 You undertake to use your reasonable endeavours to prevent
          unauthorised publication or disclosure to any trade secrets, secret or
          confidential information.

     10.3 The provisions in clauses 10.1 and 10.2 shall continue to apply after
          termination of employment, for whatever reason, without any time limit
          but the same provisions shall cease to apply, whether before or after
          the termination of employment, to any information or knowledge which
          may at any time come into the public domain other than through
          unauthorised disclosure.

     10.4 Nothing in this clause 10 shall be construed or interpreted as
          preventing you from making a "protected disclosure" within the meaning
          of the Public Interest Disclosure Act 1998. In circumstances where you
          feel it is necessary for you to make such a disclosure, you should
          first raise the issue with your manager, or if your concerns relate to
          your manager, to an officer or officers of the Company whom you
          believe are not involved or implicated in the relevant matter.

11.  POST TERMINATION RESTRICTIONS

     11.1 On termination of employment you shall not:

          11.1.1 for a period of 12 months, whether on your own behalf or on
               behalf of any other person, firm or company, directly or
               indirectly solicit or endeavour to solicit for the purposes of
               employment or offer employment to or employ any senior employee
               of the Company or any Associated Company with whom you have had
               significant contact or who you supervised, directly or
               indirectly, in the period of 12 months prior to the termination
               of your employment;

          11.1.2 for a period of 12 months, in competition with the Company,
               whether on your own behalf or on behalf of any other person, firm
               or company, directly or indirectly solicit or canvass business
               from or interfere with or accept orders from any person, firm or
               company whom, within a period of 12 months prior to the
               termination of your employment, was a client, supplier or
               business partner of the Company or any Associated Company and
               with whom you had dealings during such period; or

          11.1.3 for a period of 6 months, be employed or engaged in or
               otherwise directly or indirectly, be involved with any company,
               person, firm or other entity which directly

                                       10
<PAGE>

               competes with that part of the business of the Company with which
               you were involved or of which you had significant knowledge
               during the last 12 months of your employment, save that this
               restriction shall not preclude you from holding, by way of bona
               fide investment only, no more than 1% of any class of issued
               shares or other securities which are listed or dealt in on any
               recognised investment exchange;

        11.1.4 at any time after the termination of your employment make use
               of any corporate or business name which is identical to or
               similar with or likely to be confused with the corporate names
               and/or business name or names of the Company or of any Associated
               Company or in any way hold yourself out as being connected with
               the Company or any Associated Company.

     11.2 The length of any restriction under clause 11.1 will be reduced by the
          length of any period of notice during which you are required to remain
          away from work pursuant to clause 9.3, save that any references to a
          period immediately preceding termination of your employment in clause
          11.1 shall be amended to be read as the same period immediately
          preceding the start of the period you are required to remain away from
          work in such circumstances.

     11.3 Each of the restrictions set out in this clause 11 constitutes an
          entirely separate, severable and independent restriction.

12.  INVENTIONS

     12.1 Subject to the Patents Act 1977 and the Copyright, Designs and Patents
          Act 1988, any invention, design, or copyright work, including without
          limitation all documents, data, drawings, specifications, articles,
          computer programmes, object codes, source codes, network designs,
          business logic, notes, sketches, drawings, reports, modifications,
          tools, scripts or other items ("Works"), made by you during the course
          of your employment with the Company shall immediately upon creation or
          performance vest in and shall be and remain the sole and exclusive
          property of the Company, and you hereby irrevocably and
          unconditionally assign to the Company, all right, title and interest
          in and to the same.

     12.2 You must promptly notify the Company of any Works which you create,
          which will become the absolute property of the Company and you hereby
          unconditionally waive in favour of the Company all rights (if any) you
          may have under Chapter IV (moral rights) of the

                                       11
<PAGE>

          Copyright, Designs and Patents Act 1988 (or any foreign corresponding
          rights) in connection with the authorship of any Works, wherever in
          the world enforceable, including without limitation the right to be
          identified as the author of such Works and the right not to have such
          Works altered or subjected to derogatory treatment.

     12.3 You agree to execute any formal and additional assignment required by
          the Company to vest or confirm the vesting in it of all rights in any
          Works as set out in this Clause 12 at the expense of the Company.

     12.4 The terms and obligations of this Clause 12 shall survive the expiry
          or termination of your employment for any reason.

13.  GRIEVANCE AND DISCIPLINARY PROCEDURES

     13.1 If you have any grievance of either personal or general concern
          relating to your employment with the Company, which has not been
          resolved to your satisfaction in informal discussions, you should
          raise the matter in the first instance with your manager. If you are
          still unhappy you should take up the grievance with the Board, whose
          decision shall be final.

     13.2 You must comply with such rules and procedures relating to
          disciplinary matters that may be published from time to time by the
          Company. A copy of the disciplinary procedure that is operated by the
          Company from time to time will be available from your manager.

14.  DATA PROTECTION

     14.1 You acknowledge and accept that information relating to you may be
          processed by the Company in order to fulfil the Company's obligations
          to you under your employment contract and/or for reasons relating to
          your employment with the Company and you hereby explicitly consent to
          such processing, which may include the processing of sensitive
          personal data (such as information about your health). Such processing
          will be principally for personnel, administrative and payroll
          purposes, and may include sending information about you outside of the
          European Economic Area.

15.  MONITORING OF TELECOMMUNICATIONS

     15.1 The Company has the right to monitor any and all aspects of its
          telephone and computer systems that are made available to you and to
          monitor, intercept and/or record any communications made by

                                       12
<PAGE>

          you, including any type of telephone, e-mail or Internet
          communications, for any purpose authorised under the
          Telecommunications (Lawful Business Practice) (Interception of
          Communications) Regulations 2000 and any amending or supplementary
          legislative or regulatory requirements and you hereby expressly
          consent to the Company doing so.

16.  ASSOCIATED COMPANY

     16.1 For the purposes of this Agreement, "Associated Company" means a
          company which is from time to time a subsidiary or a holding and/or
          parent company of the Company or a subsidiary (other than the Company)
          of a holding and/or parent company of the Company and "subsidiary" and
          "holding company" have the meanings ascribed to them by section 736 of
          the Companies Act 1985 as originally enacted. It is expressly agreed
          that notwithstanding any limitation imposed by the statutory
          definition of subsidiary or holding company, Associated Company
          includes LCC International, Inc., and any other entity that is
          controlled by the same entity as the Company.

17.  MISCELLANEOUS

     17.1 This Agreement cancels and is in substitution for all previous letters
          of engagement, agreements and arrangements whether oral or in writing
          relating to the subject matter hereof between the Company and
          yourself, all of which shall be deemed to have been terminated by
          mutual consent.

     17.2 There are no collective agreements relating to your employment with
          the Company.

18.  APPLICABLE LAW

     18.1 English law shall apply to this Agreement and the parties to this
          Agreement submit to the jurisdiction of the English courts.

         /s/ C. Thomas Faulders, III
----------------------------------------------------------------------
SIGNED FOR AND ON BEHALF OF LCC UK LIMITED

         /s/ Carlo Baravalle
----------------------------------------------------------------------
SIGNED BY CARLO BARAVALLE

                                      13
<PAGE>
LCC

                          ANNEX 1: BENEFITS AT A GLANCE

<Table>
<Caption>
<S>                              <C>
Medical                               Membership to Expacare for you, your spouse and dependents
                                      under the age of 18 years (see attached schedule) effective
                                      from May 1st 2001 whether you reside in the United Kingdom
                                      or in France.

Employee Life Insurance               The Company provides basic term life coverage of 4x base
                                      pay with Zurich Life Assurance.

Accidental Death & Dismemberment      The Company automatically provides AD&D coverage with
(AD&D)                                Zurich Life Assurance of 4x base pay, subject to a policy
                                      cap, which is additional to the Employee Life Insurance.

Short Term Disability (STD)           The Company will take out STD insurance for you with
                                      Zurich Life Assurance, the coverage for which insures
                                      you against short term illness for a period of up to
                                      six months, whereby you continue to receive full pay
                                      and benefits during that time.

Long Term Disability (LTD)            The Company automatically provides you with Long Term
                                      Disability (LTD) insurance with Zurich Life. LTD benefits
                                      can provide an ongoing income of up to 60% of your base for
                                      the period beyond six months.

Pension Scheme                        After three months with the Company, you will be invited to
                                      join the LCC UK Ltd Pension Scheme, with Standard Life.
                                      The Pension Scheme is currently under review and may change.
                                      Your participation will be on the same basis as may be offered
                                      to the Company's employees in the event a Policy change
                                      is implemented.

Vacation                              You are entitled to 25 days vacation each calendar year,
                                      accrued at 2.08 days per month. Your ability to carryover
                                      unused vacation days from year to year is limited by company
                                      policy.
</Table>

                                       14
<PAGE>

<Table>
<Caption>
<S>                            <C>
Mobile phone                   The Company shall provide you with a UK mobile phone
                               number directly on its account for all your company related
                               business needs and for reasonable personal use. If possible,
                               the Company will try to take over the existing contract from
                               your previous employer thus allowing you to keep your
                               current UK mobile phone number (+---------------------).

UK Tax Return                  For so long as the company offers tax assistance
                               benefits to its employees in the UK, the Company Tax Advisor
                               (KPMG today) shall be responsible to complete, at the
                               Company expenses, all the UK tax declarations becoming due
                               after your Start Date.

Season Ticket Loan             London-based employees are offered an interest-free loan
                               to cover public transport, on the subway, commuting costs
                               from home to the office.

Adoption                       The Adoption Assistance Program helps you pay for
Assistance                     adoption related expenses to a maximum of $2,000 per
                               adoption.

Civic Duty                     Additional time off is granted for jury duty and required
                               military duty.

Career                         The Educational Assistance Program helps you pay for certain
Development                    qualified ongoing education to a maximum of $4,000 per year.

</Table>

                                       15

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