Document:

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                               EXCHANGE AGREEMENT

                                     Between

                          ROYAL ACCEPTANCE CORPORATION,

                          RIT AUTO LEASING GROUP, INC.,

                                       and

                      ALLIANCE HOLDINGS LIMITED PARTNERSHIP

                               Dated July 13, 1999

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                               EXCHANGE AGREEMENT

         THIS EXCHANGE AGREEMENT (hereinafter referred to as this "Agreement"),
is entered into as of this 12th day of July, 1999, by and among Royal Acceptance
Corporation , a Delaware corporation ("Royal"), RIT Auto Leasing Group, Inc., a
New York corporation ("RIT") and Alliance Holdings Limited Partnership, the
beneficial owner of 100 shares of common stock of RIT common stock, which
constitutes 100% of the outstanding capital stock of RIT ("RIT Shareholder").

                                    Premises

         This Agreement provides for the acquisition by Royal of all of the
issued and outstanding shares of RIT solely in exchange for voting shares of
Royal, on the terms and conditions hereinafter provided, all for the purpose of
effecting a so-called "tax-free" reorganization pursuant to Sections
368(a)(1)(B) of the Internal Revenue Code of 1954, as amended.

                                    Agreement

         NOW THEREFORE, on the stated premises and for and in consideration of
the mutual covenants and agreements hereinafter set forth and the mutual
benefits to the parties to be derived herefrom, it is hereby agreed as follows:

                                    ARTICLE I

                   REPRESENTATIONS, COVENANTS, AND WARRANTIES
                                    OF ROYAL

         As an inducement to, and to obtain the reliance of the RIT Shareholder,
Royal represents and warrants as follows:

         Section 1.01 Organization. Royal is a corporation duly organized,
validly existing, and in good standing under the laws of the state of Delaware.
Royal has the corporate power and is duly authorized, qualified, franchised, and
licensed under all applicable laws, regulations, ordinances, and orders of
public authorities to own all of its properties and assets and to carry on its
business in all material respects as it is now being conducted, including
qualification to do business as a foreign corporation in the states in which the
character and location of the assets owned by it or the nature of the business
transacted by it requires qualification. Included in Schedule 1.01 are complete
and correct copies of the certificate of incorporation, as amended, and bylaws
of Royal as in effect on the date hereof. The execution and delivery of this
Agreement do not, and the consummation of the transactions contemplated by this
Agreement in accordance with the terms hereof will not, violate any provision of
the certificate of incorporation or bylaws. Royal has taken all action required
by law, its articles of incorporation, its bylaws, or otherwise to authorize the
execution and delivery of this Agreement. Royal has full power, authority, and
legal right and has taken all action required by law, its certificate of
incorporation, bylaws, and otherwise to consummate the transactions herein
contemplated.

         Section 1.02 Capitalization. The authorized capitalization of Royal
consists of 25,000,000 shares of common stock, $.001 par value per share, of
which approximately 1,867,409 shares are currently issued and outstanding and
1,000,000 shares of preferred stock $.001 par value per share, none of which
have been issued. A shareholder list is set forth in Schedule 1.02. All issued
and outstanding shares are legally issued, fully paid, and non-assessable and
not issued in violation of the pre-emptive or other rights of any

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person. There are no options, warrants, rights or convertible securities
outstanding to purchase any capital stock of Royal.

         Section 1.03 Subsidiaries and Predecessor Corporations. Royal does not
have any subsidiaries and does not own, beneficially or of record, any shares of
any other corporation.

         Section 1.04  Financial Statements.

                  (a) Included in Schedule 1.04(a) are the unaudited financial
         statements of Royal for each of its last two fiscal years ended March
         31, 1999.

                  (b) All such financial statements have been prepared in
         accordance with generally accepted accounting principles. The unaudited
         balance sheet presents fairly as of its date the financial condition of
         Royal. Except as set forth on Schedule 1.04(b), Royal did not have, as
         of the date of such balance sheet, except as and to the extent
         reflected or reserved against therein, any liabilities or obligations
         (absolute or contingent) which should be reflected in a balance sheet
         or the notes thereto, prepared in accordance with generally accepted
         accounting principles, and all assets reflected therein are properly
         reported and present fairly the value of the assets of Royal in
         accordance with generally accepted accounting principles. The
         statements of income, stockholders' equity, and changes in financial
         condition reflect fairly the information required to be set forth
         therein by generally accepted accounting principles.

                  (c) Royal has filed all state, federal, or local income tax
         returns required to be filed by it from inception to the date hereof.
         Except as set forth on Schedule 104(c), Royal does not owe any federal,
         state, county, local, or other taxes (including any deficiencies,
         interest, or penalties) through the date hereof, for which Royal may be
         liable in its own right or as a transferee of the assets of, or as a
         successor to, any other corporation or entity. Furthermore, except as
         accruing in the normal course of business, Royal does not owe any
         accrued and unpaid taxes to date of this Agreement.

                  (d) The books and records, financial and otherwise, of Royal
         are in all material respects complete and correct and have been
         maintained in accordance with good business and accounting practices.

                  (e) Royal has good and marketable title to its assets and,
         except as set forth in the financial statements of Royal or the notes
         thereto, has no material contingent liabilities, direct or indirect,
         matured or unmatured.

         Section 1.05 Information. The information concerning Royal set forth in
this Agreement and in the Schedules attached hereto is complete and accurate in
all material respects and does not contain any untrue statement of a material
fact or omit to state a material fact required to make the statements made, in
light of the circumstances under which they were made, not misleading.

         Section 1.06 Absence of Certain Changes or Events. Except as set forth
in this Agreement, since March 31, 1999:

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                  (a) there has not been (i) any material adverse change in the
         business, operations, properties, assets, or financial condition of
         Royal; or (ii) any damage, destruction, or loss to Royal (whether or
         not covered by insurance) materially and adversely affecting the
         business, operations, properties, assets, or financial condition of
         Royal;

                  (b) Royal has not (i) amended its certificate of incorporation
         or bylaws; (ii) declared or made, or agreed to declare or make, any
         payment of dividends or distributions of any assets of any kind
         whatsoever to stockholders or purchased or redeemed, or agreed to
         purchase or redeem, any of its capital stock; (iii) waived any rights
         of value which in the aggregate are extraordinary or material
         considering the business of Royal; (iv) made any material change in its
         method of management, operation, or accounting; (v) entered into any
         other material transaction; (vi) made any accrual or arrangement for
         payment of bonuses or special compensation of any kind or any severance
         or termination pay to any present or former officer or employee; (vii)
         increased the rate of compensation payable or to become payable by it
         to any of its officers or directors or any of its employees whose
         monthly compensation exceeds $1,000; or (viii) made any increase in any
         profit sharing, bonus, deferred compensation, insurance, pension,
         retirement, or other employee benefit plan, payment, or arrangement
         made to, for, or with its officers, directors, or employees;

                  (c) Royal has not (i) borrowed or agreed to borrow any funds
         or incurred, or become subject to, any material obligation or liability
         (absolute or contingent); (ii) paid any material obligation or
         liability (absolute or contingent) other than current liabilities
         reflected in or shown on the most recent Royal balance sheet; (iii)
         sold or transferred, or agreed to sell or transfer, any of its assets,
         properties, or rights, or canceled, or agreed to cancel, any debts or
         claims; (iv) made or permitted any amendment or termination of any
         contract, agreement, or license to which it is a party if such
         amendment or termination is material, considering the business of
         Royal; or (v) except as reflected on Schedule 1.02, issued, delivered,
         or agreed to issue or deliver any stock, bonds or other corporate
         securities including debentures (whether authorized and unissued or
         held as treasury stock).

         Section 1.07 Title and Related Matters. Royal has good and marketable
title to all of its properties, inventory, interests in properties, and assets,
real and personal, which are reflected in the most recent balance sheet or
acquired after that date (except properties, interests in properties, and assets
sold or otherwise disposed of since such date in the ordinary course of
business), free and clear of all liens, pledges, charges, or encumbrances except
(a) statutory liens or claims not yet delinquent; and (b) such imperfections of
title and easements as do not and will not materially detract from or interfere
with the present or proposed use of the properties subject thereto or affected
thereby or otherwise materially impair present business operations on such
properties. Royal owns, free and clear of any liens, claims, encumbrances,
royalty interests, or other restrictions or limitations of any nature
whatsoever, any and all products it is currently manufacturing, including the
underlying technology and data, and all procedures, techniques, marketing plans,
business plans, methods of management, or other information utilized in
connection with Royal's business. No third party has any right to, and Royal has
not received any notice of infringement of or conflict with asserted rights of
others with respect to any product, technology, data, trade secrets, know-how,
proprietary techniques, trademarks, service marks, tradenames, or copyrights
which, singly or in the aggregate, if the subject of an unfavorable decision,
ruling, or finding, would have a materially adverse effect on the business,
operations, financial condition, income, or business prospects of Royal or any
material portion of its properties, assets, or rights.

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         Section 1.08 Litigation and Proceedings. There are no actions, suits,
proceedings, or investigations pending or, to the knowledge of Royal, after
reasonable investigation, threatened by or against Royal or affecting Royal or
its properties, at law or in equity, before any court or other governmental
agency or instrumentality, domestic or foreign, or before any arbitrator of any
kind. Royal does not have any knowledge of any default on its part with respect
to any judgment, order, writ, injunction, decree, award, rule, or regulation of
any court, arbitrator, or governmental agency or instrumentality or of any
circumstances which, after reasonable investigation, would result in the
discovery of such a default.

         Section 1.9  Contracts.

                  (a) There are no material contracts, agreements, franchises,
         license agreements, or other commitments to which Royal is a party or
         by which it or any of its assets, products, technology, or properties
         are bound;

                  (b) All contracts, agreements, franchises, license agreements,
         and other commitments to which Royal is a party or by which its
         properties are bound and which are material to the operations of Royal
         taken as a whole are valid and enforceable by Royal in all respects,
         except as limited by bankruptcy and insolvency laws and by other laws
         affecting the rights of creditors generally;

                  (c) Royal is not a party to or bound by, and the properties of
         Royal are not subject to, any contract, agreement, other commitment or
         instrument; any charter or other corporate restriction; or any
         judgment, order, writ, injunction, decree, or award which materially
         and adversely affects, or in the future may (as far as Royal can now
         foresee) materially and adversely affect, the business, operations,
         properties, assets, or financial condition of Royal; and

                  (d) Royal is not a party to any oral or written (i) contract
         for the employment of any officer or employee; (ii) profit sharing,
         bonus, deferred compensation, stock option, severance pay, pension
         benefit or retirement plan, agreement, or arrangement covered by Title
         IV of the Employee Retirement Income Security Act, as amended; (iii)
         agreement, contract, or indenture relating to the borrowing of money;
         (iv) guaranty of any obligation, for the borrowing of money or
         otherwise; (vi) collective bargaining agreement; (vii) agreement with
         any present or former officer or director of Royal or (viii) contract,
         agreement, or other commitment, with the exception of professional fees
         to accountants and attorneys related to this Agreement and, involving
         payments by it of more than $1,000 in the aggregate.

         Section 1.10 Material Contract Defaults. Royal is not in default in any
material respect under the terms of any outstanding contract, agreement, lease,
or other commitment which is material to the business, operations, properties,
assets, or financial condition of Royal and there is no event of default in any
material respect under any such contract, agreement, lease, or other commitment
in respect of which Royal has not taken adequate steps to prevent such a default
from occurring.

         Section 1.11 No Conflict With Other Instruments. The execution of this
Agreement and the consummation of the transactions contemplated by this
Agreement will not result in the breach of any term or provision of, or
constitute an event of default under, any material indenture, mortgage, deed of
trust,

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or other material contract, agreement, or instrument to which Royal is a party
or to which any of its properties or operations are subject.

         Section 1.12 Governmental Authorizations. Royal has all licenses,
franchises, permits, and other governmental authorizations that are legally
required to enable it to conduct its business in all material respects as
conducted on the date hereof. Except for compliance with federal and state
securities and corporation laws, as hereinafter provided, no authorization,
approval, consent, or order of, or registration, declaration, or filing with,
any court or other governmental body is required in connection with the
execution and delivery by Royal of this Agreement and the consummation by Royal
of the transactions contemplated hereby.

         Section 1.13 Compliance With Laws and Regulations. Royal has complied
with all applicable statutes and regulations of any federal, state, or other
governmental entity or agency thereof, except to the extent that noncompliance
would not materially and adversely affect the business, operations, properties,
assets, or financial condition of Royal or except to the extent that
noncompliance would not result in the incurrence of any material liability for
Royal.

          Section 1.14 Insurance. All the insurable properties of Royal, if any,
are insured in their full replacement value against all risks customarily
insured against by persons operating similar properties in localities where such
properties are located and under valid and enforceable policies by insurers of
recognized responsibility. Such policy or policies, if any, containing
substantially equivalent coverage will be outstanding on the date of
consummation of the transactions contemplated by this Agreement.

         Section 1.15 Approval of Agreement. The board of directors of Royal has
authorized the execution and delivery of this Agreement and has approved the
transactions contemplated hereby, and approved the submission of this Agreement
and the transactions contemplated hereby to the shareholders of Royal for their
approval with the recommendation that the reorganization be accepted if it has
been deemed necessary.

         Section 1.16 Labor Relations. Royal has not had a work stoppage
resulting from labor problems. To the knowledge of Royal, no union or other
collective bargaining organization is organizing or attempting to organize any
employee of Royal.

         Section 1.17 Royal Schedules. Royal has delivered to RIT a copy of the
board of directors' and shareholders' minutes (if applicable) of Royal approving
this transaction.

         Section 1.18 Additional Capital. Within ninety days from the Closing
Date (as that term is defined in Section 4.03 hereof) contemplated by this
Agreement, the present principal shareholders of Royal will arrange for a
minimum of $600,000 of additional equity capital to be invested in Royal (the
"Additional Equity Investment"). In the event the Additional Equity Investment
is not made, Royal shall issue to the RIT Shareholder to 1,500,000 additional
shares of Royal common stock, on a pro rata basis, based upon the actual amount
of the Additional Equity Investment. For example, if a $200,000 Additional
Equity Investment is made, the RIT Shareholder will receive an additional
1,000,000 shares of Royal common stock.

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         Section 1.19 Absence of Liabilities. Except as set forth in Schedule
1.19 and liabilities for professional fees relating to this transaction and the
auditing of Royal's financial statements, Royal shall have no other liabilities.

                                   ARTICLE II

                   REPRESENTATIONS, COVENANTS, AND WARRANTIES
                             OF THE RIT SHAREHOLDER

         As an inducement to, and to obtain reliance of Royal, the RIT
Shareholder represents and warrants as follows:

         Section 2.01 Ownership of RIT Shares. It is the legal and beneficial
owner of the number of RIT shares set forth opposite its name at the foot of
this agreement, free and clear of any claims, charges, equities, liens, security
interests, and encumbrances whatsoever, and it has full right, power, and
authority to transfer, assign, convey, and deliver its RIT shares; and delivery
of such shares at the closing will convey to Royal good and marketable title to
such shares free and clear of any claims, charges, equities, liens, security
interests, and encumbrances whatsoever.

                                   ARTICLE III

                   REPRESENTATIONS, COVENANTS, AND WARRANTIES
                         OF RIT AUTO LEASING GROUP, INC.

         As an inducement to, and to obtain the reliance of Royal, RIT
represents and warrants as follows:

         Section 3.01 Organization. RIT is a corporation duly organized, validly
existing, and in good standing under the laws of the state of New York. RIT has
the corporate power and is duly authorized, qualified, franchised, and licensed
under all applicable laws, regulations, ordinances, and orders of public
authorities to own all of its properties and assets and to carry on its business
in all material respects as it is now being conducted, including qualification
to do business as a foreign corporation in the states in which the character and
location of the assets owned by it or the nature of the business transacted by
it requires qualification. Included in Schedule 3.01 are complete and correct
copies of the articles of incorporation, as amended, and bylaws of RIT as in
effect on the date hereof. The execution and delivery of this Agreement do not,
and the consummation of the transactions contemplated by this Agreement in
accordance with the terms hereof will not, violate any provision of these
articles of incorporation or bylaws. RIT has taken all action required by laws,
its articles of incorporation, its bylaws, or otherwise to authorize the
execution and delivery of this Agreement. RIT has full power, authority, and
legal right and has taken all action required by law, its certificate of
incorporation, bylaws, and otherwise to consummate the transactions herein
contemplated.

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         Section 3.02 Capitalization. The authorized capitalization of RIT
consists of 200 shares of common stock, no par value per share, of which 100
shares are currently issued and outstanding. There are no outstanding options,
warrants, rights or convertible securities to purchase any capital stock of RIT.
All issued and outstanding shares are legally issued, fully paid, and
non-assessable and not issued in violation of the pre-emptive or other rights of
any person.

         Section 3.03 Subsidiaries and Predecessor Corporations. RIT does not
have any subsidiaries and does not own, beneficially or of record, any shares of
any other corporation.

         Section 3.04  Financial Statements.

                  (a) Included in Schedule 3.04 (a) are unaudited financial
         statements for each of the last two fiscal years ended December 31,
         1998.

                  (b) All such financial statements have been prepared in
         accordance with generally accepted accounting principles. The unaudited
         balance sheet presents fairly as of its date, the financial condition
         of RIT. RIT did not have, as of the date of such balance sheet, except
         as and to the extent reflected or reserved against therein, any
         liabilities or obligations (absolute or contingent) which should be
         reflected in a balance sheet or the notes thereto, prepared in
         accordance with generally accepted accounting principles, and all
         assets reflected therein are properly reported and present fairly the
         value of the assets of RIT in accordance with generally accepted
         accounting principles. The statements of income, stockholders' equity,
         and changes in financial condition reflect fairly the information
         required to be set forth therein by generally accepted accounting
         principles.

                  (c) RIT has filed all state, federal, and local income tax
         returns required to be filed by it from inception to the date hereof.
         Included in Schedule 3.04(c) are true and correct copies of the federal
         income tax returns of RIT filed since 1996. None of such federal income
         tax returns have been examined by the Internal Revenue Service. Each of
         such income tax returns reflects the taxes due for the period covered
         thereby, except for amounts which, in the aggregate, are immaterial.

                  (d) RIT does not owe any unpaid federal, state, county, local,
         or other taxes (including any deficiencies, interest, or penalties)
         through the date hereof, for which RIT may be liable in its own right
         or as a transferee of the assets of, or as a successor to, any other
         corporation or entity. Furthermore, except as accruing in the normal
         course of business, RIT does not owe any accrued and unpaid taxes to
         date of this Agreement.

                  (e) The books and records, financial and otherwise, of RIT are
         in all material respects complete and correct and have been maintained
         in accordance with good business and accounting practices.

                  (f) RIT has good and marketable title to its assets and,
         except as pledged in the ordinary course of business or as set forth in
         the financial statements of RIT or the notes thereto, has no material
         contingent liabilities, direct or indirect, matured or unmatured.

         Section 3.05 Information. The information concerning RIT set forth in
this Agreement and in Schedules attached hereto is complete and accurate in all
material respects and does not contain any untrue

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statement of a material fact or omit to state a material fact required to make
the statements made, in light of the circumstances under which they were made,
not misleading.

         Section 3.06  Absence of Certain Changes or Events.  Since December
31, 1998:

                  (a) there has not been (i) any material adverse change in the
         business, operations, properties, assets, or financial condition of RIT
         or (ii) any damage, destruction, or loss to RIT (whether or not covered
         by insurance) materially and adversely affecting the business,
         operations, properties, assets, or financial condition of RIT;

                  (b) RIT has not (i) amended its articles of incorporation or
         bylaws; (ii) declared or made, or agreed to declare or make, any
         payment of dividends or distributions of any assets of any kind
         whatsoever to stockholders or purchased or redeemed, or agreed to
         purchase or redeem, any of its capital stock; (iii) waived any rights
         of value which in the aggregate are extraordinary or material
         considering the business of RIT; (iv) made any material change in its
         method of management, operation, or accounting; (v) entered into any
         other material transaction; (vi) made any accrual or arrangement for
         payment of bonuses or special compensation of any kind or any severance
         or termination pay to any present or former officer or employee; (vii)
         increased the rate of compensation payable or to become payable by it
         to any of its officers or directors or any of its employees whose
         monthly compensation exceeds $7,500; or (viii) made any increase in any
         profit sharing, bonus, deferred compensation, insurance, pension,
         retirement, or other employee benefit plan, payment, or arrangement
         made to, for, or with its officers, directors, or employees;

                  (c) RIT has not (i) borrowed or agreed to borrow any funds or
         incurred, or become subject to, any material obligation or liability
         (absolute or contingent) except liabilities incurred in the ordinary
         course of business; (ii) paid any material obligation or liability
         (absolute or contingent) other than current liabilities reflected in or
         shown on the most recent RIT balance sheet, and current liabilities
         incurred since that date in the ordinary course of business; (iii) sold
         or transferred, or agreed to sell or transfer, any of its assets,
         properties, or rights (except assets, properties, or rights not used or
         useful in its business which, in the aggregate have a value of less
         than $10,000), or canceled, or agreed to cancel, any debts or claims
         (except debts or claims which in the aggregate are of a value of less
         than $10,000); (iv) made or permitted any amendment or termination of
         any contract, agreement, or license to which it is a party if such
         amendment or termination is material, considering the business of RIT;
         or (v) issued, delivered, or agreed to issue or deliver any stock,
         bonds or other corporate securities including debentures (whether
         authorized and unissued or held as treasury stock); and

                  (d) to the best knowledge of RIT, RIT has not become subject
         to any law or regulation which materially and adversely affects, or in
         the future may adversely affect, the business, operations, properties,
         assets, or financial condition of RIT.

         Section 3.07 Title and Related Matters. RIT has good and marketable
title to all of its properties, inventory, interests in properties, and assets,
real and personal, which are reflected in the most recent balance sheet or
acquired after that date (except properties, interests in properties, and assets
sold or otherwise disposed of since such date in the ordinary course of
business), free and clear of all liens, pledges, charges, or encumbrances except
(a) statutory liens or claims not yet delinquent; (b) such imperfections of
title and easements as do not and will not materially detract from or interfere
with the

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present or proposed use of the properties subject thereto or affected thereby or
otherwise materially impair present business operations on such properties; and
(c) except as pledged in the ordinary course of business. Except as pledged in
the ordinary course of business, RIT owns, free and clear of any liens, claims,
encumbrances, royalty interests, or other restrictions or limitations of any
nature whatsoever, any and all procedures, techniques, marketing plans, business
plans, methods of management, or other information utilized in connection with
RIT's business. No third party has any right to, and RIT has not received any
notice of infringement of or conflict with asserted rights of others with
respect to any product, technology, data, trade secrets, know-how, proprietary
techniques, trademarks, service marks, tradenames, or copyrights which, singly
or in the aggregate, if the subject of an unfavorable decision, ruling, or
finding, would have a materially adverse effect on the business, operations,
financial condition, income, or business prospects of RIT or any material
portion of its properties, assets, or rights.

         Section 3.08 Litigation and Proceedings. Except as set forth in
Schedule 3.08, there are no actions, suits, proceedings, or investigations
pending or, to the knowledge of RIT after reasonable investigation, threatened
by or against RIT or affecting RIT or its properties, at law or in equity,
before any court or other governmental agency or instrumentality, domestic or
foreign, or before any arbitrator of any kind. RIT does not have any knowledge
of any default on its part with respect to any judgment, order, writ,
injunction, decree, award, rule, or regulation of any court, arbitrator, or
governmental agency or instrumentality or of any circumstances which, after
reasonable investigation, would result in the discovery of such a default.

         Section 3.09  Contracts.

                  (a) There are no material contracts, agreements, franchises,
         license agreements, or other commitments to which RIT is a party or by
         which it or any of its assets, products, technology, or properties are
         bound outside of the ordinary course of business;

                  (b) All contracts, agreements, franchises, license agreements,
         and other commitments to which RIT is a party or by which its
         properties are bound and which are material to the operations of RIT,
         taken as a whole, are valid and enforceable by RIT in all respects,
         except as limited by bankruptcy and insolvency laws and by other laws
         affecting the rights of creditors generally;

                  (c) RIT is not a party to or bound by, and the properties of
         RIT are not subject to, any contract, agreement, other commitment or
         instrument; any charter or other corporate restriction; or any
         judgment, order, writ, injunction, decree, or award which materially
         and adversely affects, or in the future may (as far as RIT can now
         foresee) materially and adversely affect, the business, operations,
         properties, assets, or financial condition of RIT; and

                  (d) Except as incurred in the ordinary course of business or
         reflected in the most recent RIT balance sheet, RIT is not a party to
         any oral or written (i) contract for the employment of any officer or
         employee which is not terminable on 30 days or less notice; (ii) profit
         sharing, bonus, deferred compensation, stock option, severance pay,
         pension benefit or retirement plan, agreement, or arrangement covered
         by Title IV of the Employee Retirement Income Security Act, as amended;
         (iii) agreement, contract, or indenture relating to the borrowing of
         money; (iv) guaranty of any obligation, other than one on which RIT is
         a primary obligor, for the borrowing of money or otherwise, excluding
         endorsements made for collection and other guaranties of obligations,
         which, in the aggregate do not exceed more than one year or providing
         for payments

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         in excess of $10,000 in the aggregate; (vi) collective bargaining
         agreement; (vii) agreement with any present or former officer or
         director of RIT or (viii) contract, agreement, or other commitment
         involving payments by it of more than $10,000 in the aggregate.

         Section 3.10 Material Contract Defaults. RIT is not in default in any
material respect under the terms of any outstanding contract, agreement, lease,
or other commitment which is material to the business, operations, properties,
assets, or financial condition of RIT and there is no event of default in any
material respect under any such contract, agreement, lease, or other commitment
in respect of which RIT has not taken adequate steps to prevent such a default
from occurring.

         Section 3.11 No Conflict With Other Instruments. The execution of this
Agreement and the consummation of the transactions contemplated by this
Agreement will not result in the breach of any term or provision of, or
constitute an event of default under, any material indenture, mortgage, deed of
trust, or other material contract, agreement, or instrument to which RIT is a
party or to which any of its properties or operations are subject.

         Section 3.12 Governmental Authorizations. RIT has all licenses,
franchises, permits, and other governmental authorizations that are legally
required to enable it to conduct its business in all material respects as
conducted on the date hereof. Except for compliance with federal and state
securities and corporation laws, as hereinafter provided, no authorization,
approval, consent, or order of, or registration, declaration, or filing with,
any court or other governmental body is required in connection with the
execution and delivery by RIT of this Agreement and the consummation by RIT of
the transactions contemplated hereby.

         Section 3.13 Compliance With Laws and Regulations. RIT has complied
with all applicable statutes and regulations of any federal, state, or other
governmental entity or agency thereof, except to the extent that noncompliance
would not materially and adversely affect the business, operations, properties,
assets, or financial condition of RIT or except to the extent that noncompliance
would not result in the incurrence of any material liability for RIT.

          Section 3.14 Insurance. All the insurable properties of RIT are
insured for their full replacement value against all risks customarily insured
against by persons operating similar properties in localities where such
properties are located and under valid and enforceable policies by insurers of
recognized responsibility. Such policy or policies containing substantially
equivalent coverage will be outstanding on the date of consummation of the
transactions contemplated by this Agreement.

         Section 3.15 Approval of Agreement. The board of directors of RIT has
authorized the execution and delivery of this Agreement and has approved the
transactions contemplated hereby.

         Section 3.16 Labor Relations. RIT has not had a work stoppage resulting
from labor problems. To the knowledge of RIT, no union or other collective
bargaining organization is organizing or attempting to organize any employee of
RIT.

         Section 3.17 RIT Schedules. RIT has delivered to Royal a copy of the
board of directors' minutes of RIT approving this transaction.

                                       10

<PAGE>

                                   ARTICLE IV

                                PLAN OF EXCHANGE

         Section 4.01 The Exchange. On the terms and subject to the conditions
set forth in this Agreement, on the Closing Date (as defined in Section 4.04),
the RIT Shareholder hereby agrees to assign, transfer, and deliver to Royal,
free and clear of all liens, pledges, encumbrances, charges, restrictions, or
known claims of any kind, nature, or description, the number of shares of common
stock of RIT set forth on Schedule 2.01 to this Agreement, constituting all of
the issued and outstanding shares of common stock of RIT and Royal agrees to
acquire such shares on such date by issuing and delivering in exchange therefor
shares of Royal restricted common stock, par value $0.001, in the amount of
56,500 shares of Royal for each outstanding share of RIT, or an aggregate amount
of 5,650,000 shares of Royal common stock, or approximately 72% of the
outstanding shares of Royal common stock. At the Closing, the RIT Shareholder
shall, upon surrender of its certificate or certificates representing such RIT
shares to the registrar and transfer agent, be entitled to receive a certificate
or certificates evidencing shares of the exchanged shares of Royal common stock
as provided herein. Upon the consummation of the transaction contemplated
herein, all shares of capital stock of RIT shall be held by Royal.

         Section 4.02 Appointment of New Directors. In connection with the
Closing of the transactions contemplated by this Agreement, Gerald Ponsiglione
shall resign as a Director of Royal, seriatim, and shall appoint Richard
Toporek, Mark Caulo and Robert Ricciuti as directors to fill the vacancies
created thereby, to serve until the next annual stockholders' meeting of Royal
and their successors shall have been elected and qualified.

         Section 4.03 Closing. The closing ("Closing") of the transactions
contemplated by this Agreement shall be on a date and at such time as the
parties may agree ("Closing Date"), but no later than July 15, 1999, provided
that the covenants and conditions set forth in Articles V, VI and VII have been
satisfied. Such Closing shall take place at a mutually agreeable time and place.

         Section 4.04 Closing Events. At the Closing, each of the respective
parties hereto shall execute, acknowledge, and deliver (or shall cause to be
executed, acknowledged, and delivered) any and all certificates, opinions,
financial statements, schedules, agreements, resolutions, rulings, or other
instruments required by this Agreement to be so delivered at or prior to the
Closing, together with such other items as may be reasonably requested by the
parties hereto and their respective legal counsel in order to effectuate or
evidence the transactions contemplated hereby.

                                       11

<PAGE>

                                    ARTICLE V

                                SPECIAL COVENANTS

         Section 5.01 Board of Directors Action by Royal. Prior to the Closing,
the Board of Directors of Royal shall:

                  (a)  effect the authorization and approval of this Agreement
         and the transactions contemplated thereby;

                  (b)  effect the action described in Section 4.02; and

                  (c)  take such other actions as the directors may determine
         are appropriate.

         Section 5.02 Access to Properties and Records. Royal and RIT will each
afford to the officers and authorized representatives of the other full access
to the properties, books, and records of each other as the case may be, in order
that each may have full opportunity to make such reasonable investigation as it
shall desire to make of the affairs of the other, and each will furnish the
other with such additional financial and operating data and other information as
to the business and properties of each other, as the case may be, as the other
shall from time to time reasonably request.

         Section 5.03 Delivery of Books and Records. At the Closing, each
company shall deliver each other the originals of the corporate minute books,
books of account, contracts, records, and all other books or documents now in
each company's possession or its representatives.

         Section 5.04 Special Covenants and Representations Regarding the
Exchanged Stock. The consummation of this Agreement and the transactions herein
contemplated, including the issuance of the exchanged shares of Royal common
stock to the RIT Shareholder as contemplated hereby, constitutes the offer and
sale of securities under the Securities Act and applicable state statutes. Such
transaction shall be consummated in reliance on exemptions from the registration
and prospectus delivery requirements of such statutes which depend, inter alia,
upon the circumstances under which the RIT Shareholder acquired such securities.

         The RIT Shareholder represents and warrants that the Royal shares to be
acquired by it pursuant to the terms of Section 4.1 hereof is being acquired for
its own account, with no intention of assigning any participation or interest
therein, and without a view to the distribution of any portion thereof, except
in accordance with the Securities Act of 1933, as amended (the "Act"). The RIT
Shareholder will not sell, assign, transfer or encumber any of such shares
unless (i) a registration statement under the Act with respect thereto is in
effect and the prospectus included therein meets the requirements of the Act, or
(ii) a no-action letter is obtained from the staff of the Securities and
Exchange Commission (the "Commission") in respect of such proposed sale,
assignment, transfer or encumbering, or (iii) Royal has received a written
opinion of counsel reasonably satisfactory to Royal that, after an investigation
of the relevant facts, such counsel is of the opinion that such proposed sale,
assignment, transfer or encumbering does not require registration under the Act.

         The RIT Shareholder understands that the Royal Stock is not being
registered under the Act and must be held indefinitely unless it is subsequently
registered thereunder or an exemption from such registration is available.
Furthermore, the RIT Shareholder understands that the Royal Stock is not being
registered under the Act in part on the ground that the issuance thereof is
exempt under Section 4(2) of

                                       12

<PAGE>

the 1933 Act as a transaction by an issuer not involving any public offering;
that Royal's reliance on such exemption is predicated in part on the foregoing
representation and warranty of the RIT Shareholder and that in the view of the
Commission, the statutory basis for the exemption claimed would not be present
if, notwithstanding such representation and warranty, the RIT Shareholder
contemplates acquiring any of the shares of Royal common stock for sale upon the
occurrence or non-occurrence of some predetermined event.

         Section 5.05 Restrictive Legend. The RIT Shareholder understands that
Royal will have an appropriate stop order placed on its stock records indicating
the existence of the terms of this Agreement, and that the certificates
representing the shares of Royal common stock shall bear a legend in
substantially the following form:

                  "THE SHARES EVIDENCED BY THIS CERTIFICATE HAVE NOT BEEN
                  REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, AND
                  MAY BE SOLD, TRANSFERRED OR ENCUMBERED ONLY PURSUANT TO AN
                  EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF
                  1933, AS AMENDED, PURSUANT TO A NO-ACTION LETTER FROM THE
                  STAFF OF THE SECURITIES AND EXCHANGE COMMISSION OR PURSUANT TO
                  AN OPINION OF COUNSEL SATISFACTORY TO THE COMPANY THAT SUCH
                  REGISTRATION IS UNNECESSARY.

         Section 5.06 Third Party Consents and Certificates. Royal and RIT agree
to cooperate with each other in order to obtain any required third party
consents to this Agreement and the transactions herein and therein contemplated.

         Section 5.07  Actions Prior to Closing.

                  (a) From and after the date of this Agreement until the
         Closing Date and except as set forth in the Agreement or Schedules
         attached hereto or as permitted or contemplated by this Agreement,
         Royal and RIT respectively, will each:

                      (i)  carry on its business in substantially the same
                  manner as it has heretofore;

                      (ii) maintain and keep its properties in states of good
                  repair and condition as at present, except for depreciation
                  due to ordinary wear and tear and damage due to casualty;

                      (iii) maintain in full force and effect insurance
                  comparable in amount and in scope of coverage to that now
                  maintained by it;

                      (iv) perform in all material respects all of its
                  obligation under material contracts, leases, and instruments
                  relating to or affecting its assets, properties, and business;

                      (v) use its best efforts to maintain and preserve its
                  business organization intact, to retain its key employees, and
                  to maintain its relationship with its material suppliers and
                  customers; and

                                       13

<PAGE>

                      (vi) fully comply with and perform in all material
                  respects all obligations and duties imposed on it by all
                  federal and state laws and all rules, regulations, and orders
                  imposed by federal or state governmental authorities.

                  (b) From and after the date of this Agreement until the
                  Closing Date, neither RIT nor Royal will:

                      (i) make any change in their articles of incorporation
                  (except as provided for in Section 5.01) or bylaws;

                      (ii) take any action described in section 1.06 in the case
                  of Royal, or in section 3.06, in the case of RIT (all except
                  as permitted therein or as disclosed in the applicable party's
                  schedules); or

                      (iii) enter into or amend any contract, agreement, or
                  other instrument of any of the types described in such party's
                  schedules, except that a party may enter into or amend any
                  contract, agreement, or other instrument in the ordinary
                  course of business involving the sale of goods or services.

         Section 5.08  Indemnification.

                  (a) Royal hereby agrees to indemnify RIT, the RIT
         Shareholders, and each of the officers, agents and directors of RIT as
         of the date of execution of this Agreement against any loss, liability,
         claim, damage, or expense (including, but not limited to, any and all
         expense whatsoever reasonably incurred in investigating, preparing, or
         defending against any litigation, commenced or threatened, or any claim
         whatsoever), to which it or they may become subject arising out of or
         based on any inaccuracy appearing in or misrepresentation made under
         Article I of this Agreement. The indemnification, as well as the rights
         and remedies thereto, provided for in this paragraph shall survive the
         Closing and consummation of the transactions contemplated hereby and
         termination of this Agreement.

                  (b) RIT hereby agrees to indemnify Royal and each of the
         officers, agents and directors of Royal as of the date of execution of
         this Agreement against any loss, liability, claim, damage, or expense
         (including, but not limited to, any and all expense whatsoever
         reasonably incurred in investigating, preparing, or defending against
         any litigation, commenced or threatened, or any claim whatsoever), to
         which it or they may become subject arising out of or based on any
         inaccuracy appearing in or misrepresentation made under Article III of
         this Agreement. The indemnification, as well as the rights and remedies
         thereto, provided for in this paragraph shall survive the Closing and
         consummation of the transactions contemplated hereby and termination of
         this Agreement.

         Section 5.09 Reverse Split. For a two (2) year period, commencing with
the closing of the transaction contemplated by this Agreement, the RIT
Shareholder shall not vote its shares of Royal in favor of a reverse stock split
unless a reverse stock split is necessary in connection with raising the price
of Royal's common stock in connection with a listing of its shares on NASDAQ or
the American Stock Exchange or as a condition imposed by an underwriter in
connection with an underwritten offering of Royal's securities. Anything to the
contrary herein notwithstanding, a majority of the shares of common

                                       14

<PAGE>

stock outstanding, not including the shares of the RIT shareholder, may waive
this provision by written consent.

         Section 5.10 Exchange Act Registration Statement. The present officers,
directors and principal shareholders of Royal agree to cooperate with the filing
of a Form 10SB with the Securities and Exchange Commission to enable Royal to
become a fully reporting company.

         Section 5.11 Issuance of Additional Shares. For a one (1) year period,
commencing with the Closing, if any additional shares of Common Stock of Royal
are issued to any of the RIT Shareholder, other than in "arms-length"
transactions, and except as may be set forth in Section 1.18 hereof, additional
shares of Common Stock of Royal will also be issued to the present shareholders
of Royal, pro rata to their current ownership. Anything to the contrary in this
Section 5.10 notwithstanding, after the Closing, Royal shall be able to issue
shares of common stock or employee stock options to key employees of Royal but
no such shares and/or options shall be issuable to Richard Toporek during the
first year after the Closing.

                                   ARTICLE VI

                  CONDITIONS PRECEDENT TO OBLIGATIONS OF ROYAL

         The obligations of Royal under this Agreement are subject to the
satisfaction, at or before the Closing Date, of the following conditions:

         Section 6.01 Accuracy of Representations. The representations and
warranties made by RIT in this Agreement were true when made and shall be true
at the Closing Date with the same force and effect as if such representations
and warranties were made at and as of the Closing Date (except for changes
therein permitted by this Agreement), and RIT shall have performed or complied
with all covenants and conditions required by this Agreement to be performed or
complied with by RIT prior to or at the Closing. Royal shall be furnished with a
certificate, signed by a duly authorized officer of RIT and dated the Closing
Date, to the foregoing effect.

         Section 6.02 Good Standing. Royal shall have received a certificate of
good standing from the Secretary of State of the State of New York or other
appropriate office, dated as of a date within ten days prior to the Closing Date
certifying that RIT is in good standing as a corporation in the State of New
York and has filed all tax returns required to have been filed by it to date and
has paid all taxes reported as due thereon.

         Section 6.03 Other Items. Royal shall have received such further
documents, certificates, or instruments relating to the transactions
contemplated hereby as Royal may reasonably request in order to satisfy due
diligence concerns.

                                       15

<PAGE>

                                   ARTICLE VII

                   CONDITIONS PRECEDENT TO OBLIGATIONS OF RIT
                            AND THE RIT SHAREHOLDERS

         The obligations of RIT and the RIT Shareholder under this Agreement are
subject to the satisfaction, at or before the Closing Date, of the following
conditions:

         Section 7.01 Accuracy of Representations. The representations and
warranties made by Royal in this Agreement were true when made and shall be true
as of the Closing Date (except for changes therein permitted by this Agreement)
with the same force and effect as if such representations and warranties were
made at and as of the Closing Date, and Royal shall have performed and complied
with all covenants and conditions required by this Agreement to be performed or
complied with by Royal prior to or at the Closing. RIT shall have been furnished
with a certificate, signed by a duly authorized executive officer of Royal and
dated the Closing Date, to the foregoing effect.

         Section 7.02 Good Standing. RIT shall have received a certificate of
good standing from the Secretary of State of the state of Delaware or other
appropriate office, dated as of a date within ten days prior to the Closing Date
certifying that Royal is in good standing as a corporation in the State of
Delaware and has filed all tax returns required to have been filed by it to date
and has paid all taxes reported as due thereon.

         Section 7.03   Other Items.

                  (a) RIT shall have received a list of shareholders of Royal
         containing the name, address, and number of shares held by each Royal
         shareholder as of the date of Closing, certified by an executive
         officer of Royal as being true, complete, and accurate.

                  (b) RIT shall have received bank cards appointing Richard
         Toporek and/or his designees as signatory on the Royal bank account
         with Chase Manhattan Bank N.A.

                  (c) RIT shall have received such further documents,
         certificates, or instruments relating to the transactions contemplated
         hereby as RIT may reasonably request in order to satisfy due diligence
         concerns.

                                  ARTICLE VIII

                                  MISCELLANEOUS

         Section 8.01 Brokers. Royal and RIT agree that there were no finders or
brokers involved in bringing the parties together or who were instrumental in
the negotiation, execution, or consummation of this Agreement. RIT and Royal
each agree to indemnify the other against any claim by any third person other
than those described above for any commission, brokerage, or finders' fee
arising from the transactions contemplated hereby based on any alleged agreement
or understanding between the indemnifying party and such third person, whether
express or implied from the actions of the indemnifying party.

                                       16

<PAGE>

         Section 8.02 Governing Law. This Agreement shall be governed by,
enforced, and construed under and in accordance with the laws of the United
States of America and, with respect to matters of state law, with the laws of
New York.

         Section 8.03. Publicity. The parties agree that no publicity, release
or other public announcement concerning the transactions contemplated by this
Agreement shall be issued by either party without the advance approval of both
the form and substance of the same by the other party and its counsel, which
approval, in the case of any publicity, release or other public announcement
required by applicable law, shall not be unreasonably withheld or delayed.

         Section 8.04 Notices. Any notices or other communications required or
permitted hereunder shall be sufficiently given if personally delivered to it or
sent by registered mail or certified mail, postage prepaid, or by prepaid
telegram addressed as follows:

                  If to Royal to:             Gerald Ponsiglione
                                              Royal Acceptance Corporation
                                              738 Third Avenue
                                              Brooklyn, NY 11232

                  If to RIT to:               Richard Toporek
                                              RIT Auto Leasing Group,
                                              90 Jericho Turnpike
                                              Floral Park, New York 11232

                  With copies to:             Gerald A.  Adler
                                              Bondy & Schloss LLP
                                              6 East 43rd Street
                                              New York, New York 10007

or such other addresses as shall be furnished in writing by any party in the
manner for giving notices hereunder, and any such notice or communication shall
be deemed to have been given as of the date so delivered, mailed, or
telegraphed.

         Section 8.05 Attorney's Fees. In the event that any party institutes
any action or suit to enforce this Agreement or to secure relief from any
default hereunder or breach hereof, the breaching party or parties shall
reimburse the non-breaching party or parties for all costs, including reasonable
attorneys' fees, incurred in connection therewith and in enforcing or collecting
any judgment rendered therein.

         Section 8.06 Confidentiality. Each party hereto agrees with the other
parties that, unless and until the transactions contemplated by this Agreement
have been consummated, it and its representatives will hold in strict confidence
all data and information obtained with respect to another party or any
subsidiary thereof from any representative, officer, director, or employee, or
from any books or records or from personal inspection, of such other party, and
shall not use such data or information or disclose the same to others, except
(i) to the extent such data or information is published, is a matter of public
knowledge, or is required by law to be published; and (ii) to the extent that
such data or information must be used or disclosed in order to consummate the
transactions contemplated by this Agreement.

                                       17

<PAGE>

         Section 8.07 Schedules; Knowledge. Each party is presumed to have full
knowledge of all information set forth in the other party's schedules delivered
pursuant to this Agreement.

         Section 8.08 Third Party Beneficiaries. This contract is solely between
Royal and RIT and the RIT Shareholder, and, except as specifically provided, no
director, officer, stockholder, employee, agent, independent contractor, or any
other person or entity shall be deemed to be a third party beneficiary of this
Agreement.

         Section 8.09 Entire Agreement. This Agreement represents the entire
agreement between the parties relating to the subject matter hereof and fully
and completely expresses the agreement of the parties relating to the subject
matter hereof. There are no other courses of dealing, understandings,
agreements, representations, or warranties, written or oral, except as set forth
herein.

         Section 8.10 Survival; Termination. The representations, warranties,
and covenants of the respective parties shall survive the Closing Date and the
consummation of the transactions herein contemplated.

         Section 8.11 Counterparts. This Agreement may be executed in multiple
counterparts, each of which shall be deemed an original and all of which taken
together shall be but a single instrument.

         Section 8.12 Amendment or Waiver. Every right and remedy provided
herein shall be cumulative with every other right and remedy, whether conferred
herein, at law, or in equity, and may be enforced concurrently herewith, and no
waiver by any party of the performance of any obligation by the other shall be
construed as a waiver of the same or any other default then, theretofore, or
thereafter occurring or existing. At any time prior to the Closing Date, this
Agreement may be amended by a writing signed by all parties hereto, with respect
to any of the terms contained herein, and any term or condition of this
Agreement may be waived or the time for performance hereof may be extended by a
writing signed by the party or parties for whose benefit the provision is
intended.
 .
         Section 8.13 Section Headings. The section headings contained in this
Agreement are inserted for conveniences of reference only and shall not affect
the meaning or interpretation of this Agreement.

                      (THIS SPACE LEFT BLANK INTENTIONALLY)

                                       18

<PAGE>

         IN WITNESS WHEREOF, the corporate parties hereto have caused this
Agreement to be executed by their respective officers, hereunto duly authorized,
as of the date first above-written.

                                     ROYAL ACCEPTANCE CORPORATION

                                     By: /s/  Gerald Ponsiglione
                                        -------------------------------------
                                           Gerald Ponsiglione, President

                                    RIT AUTO LEASING GROUP, INC.

                                     By:  /s/  Richard Toporek
                                        -------------------------------------
                                         Richard Toporek, President

                                    ALLIANCE HOLDINGS
                                         LIMITED PARTNERSHIP (100 Shares)

                                    By:  /s/  Richard Toporek
                                        -------------------------------------
                                         Richard Toporek, General Partner

                                       19

<PAGE>

                                 SCHEDULE 1.02

                             Royal Shareholder List

<PAGE>

SHAREHOLDER LIST - ROYAL ACCEPTANCE CORPORATION

              CLOSE OF BUSINESS: July 20, 1999
<TABLE>
<CAPTION>
  LAST(1)                     FIRST(l)     MI    (1)   LAST(2)       FIRST(2)     MI    (2)        SSN          ADDRESS(l)
  -------                     --------     --    ---   -------       --------     --    ---        ---          ----------
<S>                           <C>         <C>    <C>   <C>           <C>          <C>   <C>        <C>          <C>
ADLER                         GERALD A.                                                                        BONDY & SCHLOSS

ADLER                         GERALD A.                                                                        BONDY & SCHLOSS

AMITRANO                      ANTHONY

ANDERSON                      STEVEN

ARATO                         JESSICA

BARBETTA                      ANDREW                                                                           C/O LOREN INVESTMENT
                                                                                                               GROUP, INC.

BARBETTA                      LENA                                                                             C/O LOREN INVESTMENT
                                                                                                               GROUP, INC.

BATT FAMILY IRREVOCABLE                                                                                        C/O THE LOREN
TRUST                                                                                                          INVESTMENT GROUP

BAYARD                        HARVEY                                                                           C/O BONDY & SCHLOSS

BHOJ                          PRADEEP

BONDY & SCHLOSS LLP

BONDY & SCHLOSS LLP

BORZOMATI                     ALBERT                                                                           C/O LOREN INVESTMENT
                                                                                                               GROUP, INC.

BRANDENBURG                   F. JEAN                  BRANDENBURG   GLORIA       I  JTWROS

BRYAN                         FAITH                    BRYAN         STEPHEN         JTTEN      ###-##-####

CAL-TEX ENTERPRISES PROF                                                                        86-0693853
SH PLAN

CALABRO                       MARY         F.

CAMPBELL                      SEAN                                                              ###-##-####

CAMPBELL                      SEAN         F.                                                   ###-##-####    C/O ROYAL FINANCE CO

CANTOR                        IRWIN

CARNEY                        KEVIN                                                                            C/O LOREN INVESTMENT
                                                                                                               GROUP, INC.

CASSESE                       NEIL                                                                             C/O LOREN INVESTMENT
                                                                                                               GROUP, INC.

CASSESE                       NEIL                                                                             C/O LOREN INVESTMENT
                                                                                                               GROUP, INC.

</TABLE>
<PAGE>

<TABLE>
<CAPTION>
LAST(1)                       ADDRESS(2)                  CITY             ST       ZIP      DATE       PRE     #     #SHS     ST
-------                       ----------                  ----             --       ---      -----      ---   -----   ----     --
<S>                           <C>                         <C>              <C>      <C>      <C>        <C>    <C>    <C>      <C>
ADLER                         6 EAST 43RD STREET          NEW YORK         NY       10017    3/11/99     RA    2074   50,000    F

ADLER                         6 EAST 43RD STREET          NEW YORK         NY       10017    3/11/99     RA    2073   75,000    R

AMITRANO                      157 PARIS AVE, #4           NORTHVALE        NJ        7647    3/25/99     RA    2077    1,200    F

ANDERSON                      7425 CLAIRMONT DR #2710     NEW ROCHELLE     NY       11374    9/3/97      RA    2002       50    F

ARATO                         68-36 BURNS ST              FOREST HILLS     NY       11375    7/27/95           1032       50    F

BARBETTA                      25 CREST STREET, #107       WESTWOOD         NJ        7675    11/18/98    RA    2062   10,000    R

BARBETTA                      25 CREST STREET, #107       WESTWOOD         NJ        7675    11/18/98    RA    2064    2,000    R

BATT FAMILY IRREVOCABLE       25 CREST AVE #107           WESTWOOD         NJ        7675    4/14/99     RA    2106    5,000    R
TRUST

BAYARD                        6 EAST 43RD STREEI          NEW YORK         NY       10017    7/14/99     RA    2133   40,000    F

BHOJ                          10690 CASTINE AVE           CUPERTINO        CA       95014    10/9/97     RA    2017      500    R

BONDY & SCHLOSS LLP           6 EAST 43RD STREET          NEW YORK         NY       10017    3/11/99     RA    2072   75,000    R

BONDY & SCHLOSS LLP           6 EAST 43RD STREET          NEW YORK         NY       10017    3/11/99     RA    2075   50,000    F

BORZOMATI                     25 CREST STREET, #107       WESTWOOD         NJ        7675    11/18/98    RA    2065   10,000    R

BRANDENBURG                   3045 AVALON TERR            VALRICO          FL       33594    9/3/97      RA    2010      100    F

BRYAN                         779 CONCOURSE VILLAGE #7    BRONX            NY       10451    6/13/95           1001      100    F

CAL-TEX ENTERPRISES PROF      150 HILLSIDE ST             ATHENS           GA       30601    6/13/95           1002      500    F
SH PLAN

CALABRO                       901-73RD ST                 N. BERGEN        NJ        7047    3/25/99     RA    2060    4,000    F

CAMPBELL                      134 PACIFIC ST              BROOKLYN         NY       11201    4/21/98     RA    2044   57,036    F

CAMPBELL                      621 SHREWSBURY AVE #108     SHREWSBURY       NJ        7702    6/13/95           1003   50,000    R

CANTOR                        180 BIRCH DR                ROSLYN           NY       11576    7/27/95           1036      750    F

CARNEY                        25 CREST STREET, #107       WESTWOOD         NJ        7675    11/18/98    RA    2063    2,000    R

CASSESE                       25 CREST STREET, #107       WESTWOOD         NJ        7675    11/18/98    RA    2060      500    R

CASSESE                       25 CREST STREET. #107       WESTWOOD         NJ        7675    11/18/98    RA    2055      500    F
</TABLE>
OLDE MONMOUTH STOCK TRANSFER CO., INC.                                  PAGE  1
<PAGE>

SHAREHOLDER LIST - ROYAL ACCEPTANCE CORPORATION

              CLOSE OF BUSINESS: July 20, 1999
<TABLE>
<CAPTION>
  LAST(1)                 FIRST(l)      MI     (1)       LAST(2)       FIRST(2)     MI     (2)   SSN          ADDRESS(l)
  -------                 --------      --    -----      -------       --------     --     ---   ---          ----------
<S>                       <C>          <C>    <C>        <C>          <C>            <C>   <C>          <C>
CEDE & CO                                                                                        13-2551119    PO BOX 20

CEDE & CO                                                                                        13-2555119    PO BOX 20

CEDE & CO                                                                                        13-2551119    PO BOX 20

CEDE & CO                                                                                        13-2551119    PO BOX 20

CEDE & CO                                                                                        13-2555119    PO BOX 20

CEDE & CO                                                                                        13-2551119    PO BOX 20

CEDE & CO                                                                                        13-2551119    PO BOX 20

CEDE & CO                                                                                        13-2551119    PO BOX 20

CEDE & CO                                                                                        13-2555119    PO BOX 20

CEDE & CO                                                                                        13-2551119    PO BOX 20

CEDE & CO                                                                                        13-2551119    PO BOX 20

CEDE & CO                                                                                        13-2555119    PO BOX 20

CEDE & CO                                                                                        13-2551119    PO BOX 20

CEDE & CO                                                                                        13-2551119    PO BOX 20

CEDE & CO                                                                                        13-2551119    PO BOX 20

CEDE & CO                                                                                        13-2551119    PO BOX 20

CEDE & CO                                                                                        13-2551119    PO BOX 20

CEDE & CO                                                                                        13-2551119    PO BOX 20

CEDE & CO                                                                                        13-2555119    PO BOX 20

CEDE & CO                                                                                        13-2555119    PO BOX 20

CEDE & CO                                                                                        13-2555119    PO BOX 20

CEDE & CO                                                                                        13-2555119    PO BOX 20

CEDE & CO                                                                                        13-2555119    PO BOX 20

CHENEY                    BARBARA      K.

CHOKSI                    SHITAL       G.

CONLON                    JAMES        A.

CONTINENTAL TERMINALS

DAVIDO                    JOSEPH                         DAVIDO        ANGELINE          JT TEN

DEEMER                    LARRY

DEWITT                    J.                                                                                   C/O FRANK LORENZO

DIAZ                      MARCUS

DUIN                      SPENCER                                                                              C/O CUTLER HAMMER

DUIN                      SPENCER                                                                              C/O CUTLER HAMMER

EPSTEIN                   ISIDORE

</TABLE>

<PAGE>

<TABLE>
<CAPTION>
LAST(1)                       ADDRESS(2)                  CITY             ST       ZIP      DATE       PRE     #     #SHS     ST
-------                       ----------                  ----             --       ---      -----      ---   -----   ----     --
<S>                           <C>                         <C>              <C>      <C>      <C>        <C>    <C>    <C>      <C>
CEDE & CO                     BOWLING GREEN STATION       NEW YORK         NY      10004     3/17/99     RA    2076  100,000    F

CEDE & CO                     BOWLING GREEN STATION       NEW YORK         NY      10004     6/1/99      RA    2120    5,000    F

CEDE & CO                     BOWLING GREEN STATION       NEW YORK         NY      10004     4/6/99      RA    2104   16,000    F

CEDE & CO                     BOWLING GREEN STATION       NEW YORK         NY      10004     7/6/99      RA    2130    4,000    F

CEDE & CO                     BOWLING GREEN STATION       NEW YORK         NY      10004     4/17/98     RA    2042      250    F

CEDE & CO                     BOWLING GREEN STATION       NEW YORK         NY      10004     4/14/99     RA    2105    2,000    F

CEDE & CO                     BOWLING GREEN STATION       NEW YORK         NY      10004     7/13/99     RA    2132    6,000    F

CEDE & CO                     BOWLING GREEN STATION       NEW YORK         NY      10004     5/3/99      RA    2115    4,000    F

CEDE & CO                     BOWLING GREEN STATION       NEW YORK         NY      10004     6/3/99      RA    2121   37,500    F

CEDE & CO                     BOWLING GREEN STATION       NEW YORK         NY      10004     6/21/99     RA    2128    9,500    F

CEDE & CO                     BOWLING GREEN SATION        NEW YORK         NY      10004     5/26/99     RA    2119    5,000    F

CEDE & CO                     BOWLING GREEN STATION       NEW YORK         NY      10004     5/25/99     RA    2117    5,000    F

CEDE & CO                     BOWLING GREEN STATION       NEW YORK         NY      10004     7/6/99      RA    2131    8,000    F

CEDE & CO                     BOWLING GREEN STATION       NEW YORK         NY      10004     4/30/99     RA    2114    4,000    F

CEDE & CO                     BOWLING GREEN STATION       NEW YORK         NY      10004     6/29/99     RA    2129    4,000    F

CEDE & CO                     BOWLING GREEN STATION       NEW YORK         NY      10004     4/29/99     RA    2113   37,000    F

CEDE & CO                     BOWLING GREEN STATION       NEW YORK         NY      10004     4/27/99     RA    2112    2,000    F

CEDE & CO                     BOWLING GREEN STATION       NEW YORK         NY      10004     6/15/99     RA    2123      450    F

CEDE & CO                     BOWLING GREEN STATION       NEW YORK         NY      10004     6/11/99     RA    2122   10,000    F

CEDE & CO                     BOWLING GREEN STATION       NEW YORK         NY      10004     4/20/98     RA    2043    3,250    F

CEDE & CO                     BOWLING GREEN STATION       NEW YORK         NY      10004     5/9/98      RA    2048    1,250    F

CEDE & CO                     BOWLING GREEN STATION       NEW YORK         NY      10004     5/13/98     RA    2047      500    F

CEDE & CO                     BOWLING GREEN STATION       NEW YORK         NY      10004     3/26/98     RA    2034      330    F

CHENEY                        4444 U.S. 98 N/ LOT 2       LAKELAND         FL      33809     9/3/97      RA    2013       50    F

CHOKSI                        255 GATEWOOD LN             BARTLETT         IL      60103     9/3/97      RA    2014      150    F

CONLON                        4 LEAH LN                   PLAINVIEW        NY      11893     9/3/97      RA    2003      100    F

CONTINENTAL TERMINALS                                                                        2/10/97           1079    2,958    F

DAVIDO                        672 10TH ST                 BROOKLYN         NY      11215     7/27/95           1034      100    F

DEEMER                        46 LOYOLA DR                ORLANDO BEACH    FL      32018     7/27/95           1035    1,250    F

DEWITT                        25 CREST STREET SUITE 107   WESTWOOD         NJ       7675     10/6/98     RA    2053   17,000    R

DIAZ                          3150 BROADWAY #21           NEW YORK         NY      10027     7/27/95           1033      200    F

DUIN                          5 PARKWAY CENTER            PITTSBURGH       PA      15220     10/9/97     RA    2019    1,000    R

DUIN                          5 PARKWAY CENTER            PITTSBIRGH       PA      15220     10/17/96          1074      250    F

EPSTEIN                       8107 NW 9TH AVE             TAMARAC          FL      33321     7/27/95           1038      100    F

</TABLE>
OLDE MONMOUTH STOCK TRANSFER CO., INC.                                  PAGE  2
<PAGE>

SHAREHOLDER LIST - ROYAL ACCEPTANCE CORPORATION

              CLOSE OF BUSINESS: July 20, 1999
<TABLE>
<CAPTION>
  LAST(1)                     FIRST(l)     MI    (1)   LAST(2)       FIRST(2)     MI       (2)        SSN          ADDRESS(l)
  -------                     --------     --    ---   -------       --------     --       ---        ---          ----------
<S>                           <C>         <C>    <C>   <C>           <C>          <C>   <C>        <C>          <C>
FALCO                     JOHN                         FALCO          VERA               JT TEN                C/O LOREN INVESTMENT
                                                                                                               GROUP, INC.
FESCHAREK                 RICHARD          J.

FESCHAREK                 RICHARD                                                                ###-##-####   175 MOWER STREET

FREY                      DAVID

GASSOSO                   STACI            F.

GENEROSO                  CLINTON DAVID                GENEROSO       HARRIET     R.     JT TEN                C/O ASSIST
                                                                                                               ASSOCIATES, INC.
GUHA                      AJOY

HADDAD                    NAIM

HADDAD                    NAIM                                                                   ###-##-####

HALL                      KATHRYN                                                                ###-##-####

HARDDON                   BARBARA                                                                ###-##-####

HAYDE                     WILLIAM                                                                              C/O BONDY & SCHLOSS
                                                                                                               LLP
IMPERIALE                 ANDREW

KELLEY                    IVOR

KHANIMOV                  ALBERT                                                                 ###-##-####

L. ROLLS (NOMINEES) LTD                                                                                        45 RIVER CT

L. ROLLS (NOMINEES) LTD                                                                                        45 RIVER CT

LEIMER                    RITA                                                                   ###-##-####

LEVITAN                   EDWARD                                                                 ###-##-####

LIERMAN                   RICHARD                                                                ###-##-####

LOREN INVESTMENT GROUP,
INC.

LOREN INVESTMENT GROUP,
INC.

MIELE                     DANIEL

MILLER                    ERIC                                                                   ###-##-####

</TABLE>

<PAGE>

<TABLE>
<CAPTION>
LAST(1)                       ADDRESS(2)                  CITY             ST       ZIP      DATE       PRE     #     #SHS     ST
-------                       ----------                  ----             --       ---      -----      ---   -----   ----     --
<S>                           <C>                         <C>              <C>      <C>      <C>        <C>    <C>    <C>      <C>
FALCO                         25 CREST STREET, #107       WESTWOOD         NJ        7675   11/18/98     RA    2061     9,500   R

FESCHAREK                     175 MOWER STREET            WORCESTER        MA        1602    6/17/99     RA    2126     5,000   F

FESCHAREK                                                 WORCESTER        MA        1602    10/9/97     RA    2022     5,000   F

FREY                          1346 E. 59TH ST             BROOKLYN         NY       11203    7/27/95           1040        50   R

GASSOSO                       192 GOLDMINE LANE           OLD BRIDGE       NJ        8857    3/25/99     RA    2084    20,000   F

GENEROSO                      179 RT 46 SUITE 504         ROCKAWAY         NJ        7866     9/3/97     RA    2007       250   F

GUHA                          2350 HAMILTON AVE           EL CENTRO        CA       92243    10/9/97     RA    2018       600   R

HADDAD                        62 JACKSON PLACE            MOONACHIE        NJ        7074    3/25/99     RA    2085    10,000   F

HADDAD                        62 JACKSON PLACE            MOONACHIE        NJ        7074    6/13/95           1010       500   F

HALL                          P.O. BOX 55                 BURGAM           NC       28425    6/13/95           1011       175   F

HARDIDON                      3 IMPERIAL GATE             DIX HILLS        NY       11746    6/13/95           1012     2,500   F

HAYDE                         6 E. 43RD ST                NEW YORK         NY       10017    4/16/98     RA    2040   150,000   R

IMPERIALE                     72 TARPON DR                SEA GIRT         NJ        8750     9/3/97     RA    2008       300   F

KELLEY                        #3 THORN HILL GROVE         LONDON, ENGLAND                    6/13/95           1013       500   F

KHANIMOV                      184-69 ABERDEEN RD          JAMAICA ESTATES  NY       11432    6/13/95           1014       200   F

L. ROLLS (NOMINEES) LTD       UPPER GROUND                LONDON, ENGLAND SE1 9PC            7/22/96           1054     2,500   F

L. ROLLS (NOMINEES) LTD       UPPER GROUND                LONDON, ENGLAND SE1 9PC            7/22/96           1056     5,000   RS

LEIMER                        1912 GREEN RIDGE RD         JACKSON          MO       63750    6/13/95           1015       550   F

LEVITAN                       22 CANDLEWOOD CT            COLONIA          NJ        7087    6/13/95           1016        50   F

LIERMAN                       3733 S. MAIN                ROCKFORD         IL       61102    6/13/95           1017        50   F

LOREN INVESTMENT GROUP, INC.  25 CREST STREET, #107       WESTWOOD         NJ        7675   11/18/98     RA    2068    65,000   R

LOREN INVESTMENT GROUP, INC.  25 CREST STREET STE 107     WESTWOOD         NJ        7675    1/11/99     RA    2068    73,000   F

MIELE                         30-06 MARLOT AVE            FAIRLAWN         NJ        7410    3/25/99     RA    2090     2,400   F

MILLER                        12 KERWICK CT               N. WALES         PA       19454    6/13/95           1019       250   F

</TABLE>
OLDE MONMOUTH STOCK TRANSFER CO., INC.                                  PAGE  3
<PAGE>

SHAREHOLDER LIST - ROYAL ACCEPTANCE CORPORATION

              CLOSE OF BUSINESS: July 20, 1999
<TABLE>
<CAPTION>
  LAST(1)                     FIRST(l)     MI    (1)   LAST(2)       FIRST(2)     MI       (2)        SSN          ADDRESS(l)
  -------                     --------     --    ---   -------       --------     --       ---        ---          ----------
<S>                           <C>         <C>    <C>   <C>           <C>          <C>   <C>        <C>          <C>
MILLER                    SHARI                                                                  055-4O-7909

MISLAK                    RICHARD          J.

MOORE                     DAVID

MOORE                     DAVID                                                                  ###-##-####

MOORE                     DAVID

NATIONAL INVESTOR SERVICES                                                                       13-3842038

NEARING                   RICHARD

NEARING                   RICHARD

NUSBAUM                   SARAH
                          JACQUELINE

ORNELAS                   JOSEPH           Z.

OYAGA                     ENRIQUE                                                                ###-##-####

PIZZICARA                 ANNE

PIZZICARA                 DIERDRE

PONSIGLIONE               GERALD                       PONSIGLIONE    DIANE              JT TEN

PONSIGLIONE               GERALD                                                                               C/O BONDY & SCHLOSS
                                                                                                               LLP
PONSIGLIONE               GERALD                       PONSIGLIONE    DIANE              JT TEN

PONSIGLIONE               JAMES MICHAEL                                                                        C/O THE LOREN
                                                                                                               INVESTMENT GROUP

PONSIGLIONE               MARK JAMES                                                                           C/O THE LOREN
                                                                                                                INVESTMENT GROUP
PROTESTA                  ROLAND                                                                 ###-##-####

RATCLIFFE                 THOMAS           W.                                                    ###-##-####

RAZA                      MOHAMMED                                                               ###-##-####

RIORDAN                   JOHN                         RIORDAN        JAN                JT TEN

ROLLS                     LEN                                                                                  45 RIVER CT

ROTH                      PAUL

RUSSO                     JOHN

</TABLE>

<PAGE>

<TABLE>
<CAPTION>
LAST(1)                       ADDRESS(2)                  CITY             ST       ZIP      DATE       PRE     #     #SHS     ST
-------                       ----------                  ----             --       ---      -----      ---   -----   ----     --
<S>                           <C>                         <C>              <C>      <C>      <C>        <C>    <C>    <C>      <C>
MILLER                        175 W. 79TH ST              NEW YORK         NY       10024    6/13/95           1018       250   F

MISLAK                        267 MADIE AVE               SPOTSWOOD        NJ        8864    3/25/99     RA    2091    15,000   F

MOORE                         105 THOMPSON ST #1          NEW YORK         NY       10012    9/14/95           1048       250   F

MOORE                         105 THOMPSON ST #1          NEW YORK         NY       10012    6/13/95           1020       350   F

MOORE                                                                                        10/9/97     RA    2023     2,000   R

NATIONAL INVESTOR SERVICES    55 WATER ST 32ND FL         NEW YORK         NY       10041    1/27/97           1076       350   F

NEARING                       1114 CHESTERTON DR          RICHARDSON       TX       75080    10/9/97     RA    2025     6,250   R

NEARING                       1114 CHESTERTON DR          RICHARDSON       TX       75080    10/9/97     RA    2015     2,500   R

NUSBAUM                       46 W. 95TH ST #313          NEW YORK         NY       10025    9/14/95           1049     1,750   R

ORNELAS                       2512 ALTA MIRA DR           TYLER            TX       75701    10/9/97     RA    2015     2,500   R

OYAGA                         1972 E. 16TH ST             BROOKLYN         NY       11229    6/13/95           1022       125   F

PIZZICARA                     142 ST. JOHNS PL            BROOKLYN         NY       11217    7/27/95           1037        50   F

PIZZICARA                     843 CARROL ST               BROOKLYN         NY       11215    7/27/95           1042       100   F

PONSIGLIONE                                                                                  2/10/97           1078     7,500   F

PONSIGLIONE                   6 E. 43RD ST                NEW YORK         NY       10017    4/16/98     RA    2041   200,000   R

PONSIGLIONE                                                                                  10/9/97     RA    2027     2,033   F

PONSIGLIONE                   25 CREST AVE #107           WESTWOOD         NJ        7675    4/14/99     RA    2109    75,000   R

PONSIGLIONE                   25 CREST AVE #107           WESTWOOD         NJ        7675    4/14/99     RA    2108    75,000   R

PROTESTA                      2221 W. TOLEDO PL           GREAT NECK       NY       11045    6/13/95           1023       750   F

RATCLIFFE                     2105 OCEAN AVE              SPRING LAKE      NJ        7762    6/13/95           1024    25,000   R

RAZA                          1520 PENNINGTON RD          TRENTON          NJ        8618    6/13/95           1025       500   F

RIORDAN                       3958 N. OLEANDER            CHICAGO          IL       60634    7/27/95           1044        50   F

ROLLS                         UPPER GROUND                LONDON                             3/25/99     RA    2092    20,000   F

ROTH                          33-15 MURRAY LN             FLUSHING         NY       11354    10/9/97     RA    2021     1,000   R

RUSSO                         99 WALL ST                  NEW YORK         NY       10005    7/27/95           1043        50   F

</TABLE>

OLDE MONMOUTH STOCK TRANSFER CO., INC.                                  PAGE  4

<PAGE>

SHAREHOLDER LIST - ROYAL ACCEPTANCE CORPORATION

              CLOSE OF BUSINESS: July 20, 1999
<TABLE>
<CAPTION>
  LAST(1)                     FIRST(l)     MI    (1)   LAST(2)       FIRST(2)     MI       (2)        SSN          ADDRESS(l)
  -------                     --------     --    ---   -------       --------     --       ---        ---          ----------
<S>                           <C>         <C>    <C>   <C>           <C>          <C>   <C>        <C>          <C>
RUTHENBERG                A.

SCHMIDT                   CHRIS            M.

SCHMIDT                   FRANK            T.

SCHUMANN                  ALBERT                                                                 ###-##-####

SEIFF                     B.                                                                                   C/O FRANK LORENZO

SEIFF                     L.                                                                                   C/O FRANK LORENZO

SIEGEL                    JOSEPH                       SIEGEL         ETHEL              JT TEN  ###-##-####

SIGNORELLI                LINDO

SIGNORELLI                LINDO            A.          SIGNORELLI     MARILYN     F      JTWROS

SINGH                     HARJINDER PAL                                                          ###-##-####

STEWART                   DUANE                        STEWART        MAILE              JT TEN                C/O RIT AUTO LEASING
                                                                                                               GROUP, INC.
SWARTZ                    PHILIP

TARANTOLA                 ROBERT

THE LOREN INVESTMENT                                                                                           C/O RIT AUTO LEASING
GROUP, INC.                                                                                                    GROUP, INC

THOMAS                    BETHANNE

THOMAS                    STEPHEN

TUNG                      HSUE                         DONG           HUI                JT TEN

TUNG                      HSUE                         DONG           HUI                JT TEN

TUTTA ITALIA INC.

UMANOFF                   EDWIN                                                                  ###-##-####

VERGONA                   ANGELA

WELLINGTON                JASON            T.                                                    ###-##-####

WESLOCK                   MICKEY                                                                 ###-##-####

YAULEY                    JENKINS

ZITTEL                    GREGORY          T.

</TABLE>

<PAGE>

<TABLE>
<CAPTION>
LAST(1)                       ADDRESS(2)                  CITY             ST       ZIP      DATE       PRE     #     #SHS     ST
-------                       ----------                  ----             --       ---      -----      ---   -----   ----     --
<S>                           <C>                         <C>              <C>      <C>      <C>        <C>    <C>    <C>      <C>
RUTHENBERG                    7810 17TH AVE               BROOKLYN         NY       11214    3/25/99     RA    2094     3,000   F

SCHMIDT                       3444 W. MONTROSS            CHICAGO          IL       60616    9/3/97      RA    2005        50   F

SCHMIDT                       3444 W. MONTROSS            CHICAGO          IL       60618    9/3/97      RA    2012       100   F

SCHUMANN                      11 CANTERBURY RD            MANALAPAN        NJ        7726    6/13/95           1026        50   F

SEIFF                         25 CREST STREET SUITE 107   WESWTWOOD        NJ        7675    10/6/98     RA    2050    17,000   R

SEIFF                         25 CREST STREET SUITE 107   WESWTWOOD        NJ        7675    10/6/98     RA    2051    17,000   R

SIEGEL                        2800 S. OCEAN BLVD          BOCA RATON       FL                6/13/95           1027       250   F

SIGNORELLI                                                                                   10/9/97     RA    2026     1,715   R

SIGNORELLI                    15 FAIRFAX ST               WYNANTSKILL      NY       12196    9/3/97      RA    2001       500   F

SINGH                         144 ATLANTIC AVE #1         BROOKLYN         NY       11201    4/21/98     RA    2045    10,000   F

STEWART                       90 JERICHO TPKE             FLORAL PARK      NY       11001    4/22/99     RA    2111     5,000   R

SWARTZ                        315 LINDA ST                BELFORD          NJ        7727    7/27/95           1041       500   F

TARANTOLA                     6605 14TH AVE               BROOKLYN         NY       11219    3/25/99     RA    2097     2,000   F

THE LOREN INVESTMENT
GROUP, INC.                   90 JERICHO TPKE             FLORAL PARK      NY       11001    4/22/99     RA    2110   140,000   R

THOMAS                        76 CLIFF RD                 BELLE TESSE      NY       11777    3/25/99     RA    2098   100,000   F

THOMAS                        4201 TERRA VERDE DR         VERDALE          WA       99037    10/9/97     RA    2020     1,250   R

TUNG                          11 E. LAUREL HILL RD        GREENBELT        MD       20770    6/13/95           1028     1,000   F

TUNG                          11 E. LAUREL HILL RD        GREENBELT        MD       20770    9/14/95           1047     1,850   F

TUTTA ITALIA INC.             16 TWIN LAKES DR            COLTS NECK       NJ        7722    3/25/99     RA    2099    10,000   F

UMANOFF                       9712 FLATLANDS AVE          BROOKLYN         NY                6/13/95           1029       250   F

VERGONA                       11 FIRST ST                 ENGLEWOOD CLIFFS NJ        7632    3/25/99     RA    2101     4,000   F

WELLINGTON                    4658 YEAGER RD              COLUMBIA         MO       65202    6/13/95           1030       250   F

WESLOCK                       616 HEMLOCK ST              ROSELLE PARK     NJ        7204    9/25/95           1050       227   F

YAULEY                        477 AUDIBON PKWY            SYRACUSE         NY       13224    9/3/97      RA    2011     1,250   F

ZITTEL                        335 RUNYON AVE              MIDDLESEX        NJ        6645    9/3/97      RA    2006        50   F
====================          =========================   ================ ==       =====    =======     ===   ==== =========   ==
TOTAL COUNT                                                                                                         1,831,508
                                                                                                                          131
</TABLE>

OLDE MONMOUTH STOCK TRANSFER CO., INC.                                  PAGE  5

<PAGE>

                                SCHEDULE 1.04(a)

                            Royal Financial Statement

Presentation of Royal Audited Financial Statements for fiscal years Ending March
1998 and 1999 have been waived by RIT

<PAGE>

                                SCHEDULE 1.04(b)

        Liabilities or Obligations Not Reflected in Financial Statements

Presentation of Royal Liabilities not set forth in Royal Balance Sheet have been
waived by RIT

<PAGE>

                                SCHEDULE 1.04(c)

                Federal, State, County, Local or Other Taxes Owed

                                      NONE

<PAGE>

                                  SCHEDULE 1.19

                 Royal Liabilities Other Than Professional Fees

                                      NONE

<PAGE>

                                  SCHEDULE 3.01

            RIT Certificate of Incorporation, as Amended, and By-Laws

<PAGE>

                          CERTIFICATE OF INCORPORATION

                                       OF

                          RIT AUTO LEASING GROUP, INC.

                Under Section 402 of the Business Corporation Law

         The undersigned, a natural person of the age of eighteen years or over,
desiring to form a corporation pursuant to the provisions of the Business
Corporation Law of the State of New York, hereby certifies as follows:

         FIRST: The name of the corporation is:

                     RIT AUTO LEASING GROUP, INC.

         SECOND: The purpose for which it is formed is as follows:

         To engage in any lawful act or activity for which corporations may be
formed under the Business Corporation Law provided that the corporation is not
formed to engage in any act or activity which requires the consent or approval
of any state official, department, board agency or other body, without such
approval or consent first being obtained.

         For the accomplishment of the aforesaid purposes, and in furtherance
thereof, the corporation shall have and may exercise all of the powers conferred
by the Business Corporation Law upon corporations formed thereunder, subject
to any limitations contained in Article 2 of said law or in accordance with the
Provisions of any other statute of the State of New York.

          THIRD: The office of the corporation in the State of New York is to be
located in the County of Nassau.

         FOURTH: The aggregate number of shares which the corporation shall have
the authority to issue is 200, no par value.

<PAGE>

         FIFTH: The Secretary of State is designated as agent of the corporation
upon whom process against the corporation may be served, and the address to
which the Secretary of State shall mail a copy of any process against the
corporation served upon him is: c/o, 90 Jericho Turnpike, Floral Park, NY 11001.

          SIXTH: A director of the corporation shall not be liable to the
corporation or its shareholders for damages for any breach of duty in such
capacity except for liability if a judgment or other final adjudication adverse
to a director establishes that his or her acts or omissions were in bad faith or
involved intentional misconduct or a knowing violation of law or that the
director personally gained in fact a financial profit or other advantage to
which he or she was not legally entitled or that the director's acts violated
Section 719 of the Business Corporation Law; or liability for any act or
omission prior to the adoption of this provision.

                  IN WITNESS WHEREOF, I hereunto sign my name and affirm that
the statements made herein are true under the penalties of perjury.
Dated: March 16, 1993

_______________________________
Scott J. Schuster, Incorporator
283 Washington Avenue
Albany, New York 12206

<PAGE>

                                     BY-LAWS

                                       OF

                           RIT AUTO LEASING GROUP INC.
                       ____________________________________

                        ARTICLE I. SHAREHOLDERS' MEETING

Section 1. Annual Meeting.

         The annual meeting of the shareholders shall be held within five months
after the close of the fiscal year of the Corporation, for the purpose of
electing directors, and transacting such other business as may properly come
before the meetings.

Section 2. Agenda at the Shareholders' Annual Meeting.

                  (a) Calling the meeting to order;

                  (b) Roll call;

                  (c) Reading of the minutes of the last meeting;

                  (d) Reports of the Officers;

                  (e) Reports of the Committees;

                  (f) Election of the Directors;

                  (g) Adjournment

Section 3. Special Meetings.

                  Special meetings of the shareholders may be called at any time
by the Board of Directors or by the President or the Secretary at the written
request of the holders of fifty percent (50%) of the shares then outstanding and
entitled to vote thereat, or as otherwise required under the provisions of the
Business Corporation Law.

Section 4. Place of Meetings.

                  All meetings of shareholders shall be held at the principal
office of the Corporation, or at such other places within or without the State
of New York as shall be designated in the notices or waivers of notice of such
meetings.

                                     BY-LAWS
                                       1

<PAGE>

Section 5. Notice of Meetines.

                  (a) Written notice of each meeting of shareholders, whether
annual or special, stating the time when and place where it is to be held, shall
be served either personally or by mail, not less than ten or more than fifty
days before the meeting, upon each shareholder of record entitled to vote at
such meeting, and to any other shareholder to whom the giving of notice may be
required by law. Notice of a special meeting shall also state the purpose or
purposes for which the meeting is called, and shall indicate that it is being
issued by, or at the direction of, the person or persons calling the meeting.
If, at any meeting, action is proposed to be taken that would, if taken, entitle
shareholders to receive payment for their shares pursuant to the Business
Corporation Law, the notice of such meeting shall include a statement of that
purpose and to that effect. If mailed, such notice shall be directed to each
such shareholder at his address, as it appears on the records of the
shareholders of the Corporation, unless he shall have previously filed with the
Secretary of the Corporation a written request that notices intended for him be
mailed to some other address, in which case, it shall be mailed to the address
designated in such request.

                  (b) Notice of any meeting need not be given to any person who
may become a shareholder of record after the mailing of such notice and prior to
the meeting, or to any shareholder who attends such meeting in person or by
proxy, or to any shareholder who, in person or by proxy, submits a signed waiver
of notice either before or after such meeting. Notice of any adjourned meeting
of shareholders need not be given, unless otherwise required by statute.

Section 6. Quorum of Shareholders:

                  (a) Except as otherwise provided herein, or by statute, or in
the Certificate of Incorporation (such Certificate and any amendments thereof
being hereinafter collectively referred to as the "Certificate of
Incorporation"), at all meetings of shareholders of the Corporation, the
presence at the commencement of such meetings in person or by proxy of
shareholders holding of record a majority of the total number of shares of the
Corporation then issued and outstanding and entitled to vote, shall be necessary
and sufficient to constitute a quorum for the transaction of any business. The
withdrawal of any shareholder after the commencement of a meeting shall have no
effect on the existence of a quorum, after a quorum has been established at such
meeting.

                  (b) Despite the absence of a quorum at any annual or special
meeting of shareholders, the shareholders, by a majority of the votes cast by
the holders of shares entitled to vote thereon, may adjourn the meeting. At any
such adjourned meeting at which a quorum is present, any business may be
transacted which might have been transacted at the meeting as originally called
if a quorum had been present. However, if after the adjournment, the Board of
Directors fixes a new record date for the adjourned meeting, a notice of the
adjourned meeting shall be given to each shareholder of record on the new record
date.

                                     BY-LAWS
                                        2

<PAGE>

Section 7. Voting:

                  (a) Except as otherwise provided by statute or by the
Certificate of Incorporation, any corporate action, other than the election of
directors to be taken by vote of the shareholders, shall be authorized by a
majority of votes cast at a meeting of shareholders by the holders of shares
entitled to vote thereon. Election of directors shall be accomplished by a
candidate receiving a plurality of the votes cast at a shareholder's meeting by
the shareholders entitled to vote in the election.

                  (b) Except as otherwise provided by statute or by the
Certificate of Incorporation, at each meeting of shareholders, each holder of
record of stock of the Corporation entitled to vote thereat, shall be entitled
to one vote for each share of stock registered in his name on the books of the
Corporation. Upon demand of the shareholders holding ten percent (10%) in
interest of the shares, present in person or by proxy, and entitled to vote, and
voting shall be by ballot.

Section 8. Proxies.

                  Each shareholder entitled to vote or to express consent or
dissent without a meeting, may do so by proxy; provided, however, that the
instrument authorizing such proxy to act shall have been executed in writing by
the shareholder himself, or by his attorney-in-fact thereunto duly authorized in
writing. No proxy shall be valid after the expiration of eleven months from the
date of its execution, unless the persons executing it shall have specified
therein the length of time it is to continue in force. Such instrument shall be
exhibited to the Secretary at the meeting and shall be filed with the records of
the Corporation.

Section 9. Action Without a Meeting.

                  Any resolution in writing, signed by all of the shareholders
entitled to vote thereon, shall constitute action by such shareholders to the
effect therein expressed, with the same force and effect as if the same had been
duly passed by unanimous vote at a duly called meeting of shareholders, and such
resolution so signed shall be inserted in the minute book of the Corporation
under its proper date.

                                     BY-LAWS
                                        3

<PAGE>

                              ARTICLE II. DIRECTORS

Section 1. Number.

                  The affairs and the business of the Corporation, except as
otherwise provided in the Certificate of Incorporation, shall be managed by the
Board of Directors. The number of the directors of the Corporation shall be
( ) unless and until otherwise determined by vote of a majority of the entire
Board of Directors. The "entire Board" as used in this Article shall mean the
total number of directors which the Corporation would have if there were no
vacancies. The number of directors shall not be less than three, unless all of
the outstanding shares are owned beneficially and of record by less than three
shareholders, in which event the number of directors shall not be less than the
number of shareholders.

Section 2. How Elected.

                  At the annual meeting of shareholders, the persons duly
elected by the votes cast at the election held thereat shall become the
directors for the ensuing year.

Section 3. Term of Office and Qualifications.

                  The term of office of each of the directors shall be until the
next annual meeting of shareholders and thereafter until a successor has been
elected and qualified. Each director shall be at least eighteen years of age.

Section 4. Duties of Directors.

                  The Board of Directors shall have the control and general
management of the affairs and business of the Corporation unless otherwise
provided in the certificate of Incorporation. Such directors shall in all cases
act as a Board regularly convened by a majority, and they may adopt such rules
and regulations for the conduct of their meetings, and the management and
business of the Corporation as they may deem proper, not inconsistent with these
By-Laws and the Laws of the State of New York.

Section 5. Directors' Meetings.

                  Regular meetings of the Board of Directors shall be held
immediately following the annual meetings of the shareholders, and at such other
times as the Board of Directors may determine. Special meetings of the Board of
Directors may be called by the President at any time and must be called by the
President or the Secretary upon the written request of two directors. All
meetings, both regular and special, shall be held at the principal office of the
Corporation or at such other location, within or without the State of New York,
as the Board of Directors may from time to time determine.

                                     BY-LAWS
                                        4
<PAGE>

Section 6. Notice of Meetings.

                  Notice of the place, day and hour of every regular and special
meeting shall be given to each director by delivering the same to him personally
or sending the same to him by telegraph or leaving the same at his residence or
usual place of business, at least one (1) day before the meeting, or shall be
mailed to each director, postage prepaid and addressed to him at the last known
Post Office address according to the records of the Corporation, at least three
(3) days before the meeting. No notice of any adjourned meeting of the Board of
Directors needs to be given other than by announcement at the meeting, subject
to the provisions of Section 7 of this Article.

Section 7. Quorum of Directors.

                  At any meeting of the Board of Directors, except as otherwise
provided by the Certificate of Incorporation, or by these By-Laws, a majority of
the Board of Directors shall constitute a quorum for the transaction of
business. However, a lesser number, when not constituting a quorum, may adjourn
the meeting until a quorum shall be present or represented.

Section 8. Director and Committee Action by Conference Telephone.

                  Any one or more members of the Board of Directors, or of any
committee thereof, may participate in a meeting of such Board or committee by
means of a conference telephone or similar equipment which allows all persons
participating in the meeting to hear each other at the same time. Participation
by such means shall constitute presence in person at such a meeting.

Section 9. Voting.

                  Except as otherwise provided by statute, or by the Certificate
of Incorporation, or by these By-Laws, the affirmative vote of a majority of the
Directors present at any meeting of the Board of Directors at which a quorum is
present shall be necessary for the transaction of any item of business thereat.
Any resolution in writing, signed by all of the directors entitled to vote
thereon, shall constitute action by such directors to the effect therein
expressed, with the same force and effect as if the same had been duly passed by
unanimous vote at a duly called meeting of directors and such resolution so
signed shall be inserted in the minute book of the Corporation under its proper
date.

Section 10. Vacancies.

                  Unless otherwise provided in the Certificate of Incorporation,
vacancies in the Board of Directors occurring between annual meetings of the
shareholders, other than vacancies due to the removal of directors without
cause, shall be filled for the unexpired portion of the term by a majority vote
of the remaining directors, even though less than a quorum exists. Vacancies
occurring in the Board by reason of the removal of directors

                                     BY-LAWS
                                        5
<PAGE>

without cause may be filled only by vote of the shareholders. A director so
elected shall hold office for the unexpired term of his predecessor, and until
his successor has been elected and qualified.

Section 11. Removal of Directors.

                  Any or all of the directors may be removed, either with or
without cause at any time by a vote of the shareholders at any meeting called
for such purpose, and another director, or more than one may be elected by such
shareholders in the place of the director(s) so removed, to serve for the
remainder of the term.

Section 12. Resignation.

                  Any director may resign at any time by giving written notice
to the Board of Directors, the President or the Secretary of the Corporation.
Unless otherwise specified in such written notice, such resignation shall take
effect upon receipt thereof by the Board of Directors or such officer, and the
acceptance of such resignation shall not be necessary to make it effective.
However, such resignation will not be effective to discharge any accrued
obligations or duties of a director.

Section 13. Salary.

                  No stated salary shall be paid to directors, as such, for
their services, but by resolution of the Board of Directors a fixed sum and
expenses of attendance, if any, may be allowed for attendance at each regular or
special meeting of the Board, provided, that nothing herein contained shall be
construed to prevent any director from serving the Corporation in any other
capacity and receiving compensation therefor.

Section 14. Contracts.

                  (a) No contract or other transaction between this Corporation
and any other Corporation shall be impaired, affected or invalidated, nor shall
any director be liable in any way by reason of the fact that any one or more of
the directors of this Corporation is or are interested in, or is a director or
officer, or are directors or officers of such other Corporation, provided that
such facts are disclosed or made known to the Board of Directors.

                   (b) Any director, personally and individually, may be
interested in any contract or transaction of this Corporation, and no director
shall be liable in any way by reason of such interest, provided that the fact of
such interest be disclosed or made known to the Board of Directors, and provided
that the Board of Directors shall authorize, approve or ratify such contract or
transaction by the vote (not counting the vote of any such director) of a
majority of a quorum, notwithstanding the presence of any such director at the
meeting at which such action is taken. Such director or directors may be counted
in determining the presence of a quorum at such meeting. This Section shall not
be construed to impair or invalidate or in any way affect any contract or other
transaction which would otherwise be valid under the law (common, statutory or
otherwise) applicable thereto.

                                     BY-LAWS
                                        6
<PAGE>

                  (c) However, if there was no such disclosure or knowledge, or
if the vote of such interested director was necessary for the approval of such
contract or transaction at a meeting of the Board or committee at which it was
approved, the Corporation may avoid the contract or transaction, unless the
party or parties thereto shall establish affirmatively that the contract or
transaction was fair and reasonable as to the Corporation, at the time it was
approved by the Board, a committee or the shareholders.

Section 15. Committees.

                  The Board of Directors, by resolution adopted by a majority of
the entire Board, may designate from among its members an executive committee
and such other committees, and alternate members thereof, as they deem
desirable, each consisting of three or more members, with such powers and
authority (to the extent permitted by law) as may be provided in such
resolution. Each such committee shall serve at the pleasure of the Board of
Directors.

                                     BY-LAWS
                                        7

<PAGE>

                              ARTICLE III. OFFICERS

Section 1. Number of Officers.

                  The officers of the Corporation shall consist of a President,
a Secretary, a Treasurer, and such other officers, including a Chairman of the
Board of Directors, and one or more Vice Presidents, as the Board of Directors
may from time to time deem advisable. Any officer other than the Chairman of the
Board of Directors may be, but is not required to be, a director of the
Corporation. Any officer may hold more than one office except the same person
may not hold the office of President and Secretary.

Section 2. Election of Officers.

                  Officers of the Corporation shall be elected at the first
meeting of the Board of Directors. Thereafter, and unless otherwise provided in
the Certificate of Incorporation, the officers of the Corporation shall be
elected annually by the Board of Directors at its meeting held immediately after
the annual meeting of shareholders and shall hold office for one year and until
their successors have been duly elected and qualified.

Section 3. Removal of Officers.

                  Any officer elected by the Board of Directors may be removed,
with or without cause, and a successor elected, by a vote of the Board of
Directors. Any officer elected by the shareholders may be removed, with or
without cause, and a successor elected, only by a vote of the shareholders.
Additionally, an officer elected by the shareholders may have his authority
suspended, for cause, by the Board of Directors.

Section 4. President.

                  The President shall be the chief executive officer of the
Corporation and shall have general charge of business, affairs and property
thereof, subject to direction of the Board of Directors, and shall have general
supervision over its officers and agents. He shall, if present, preside at all
meetings of the Board of Directors in the absence of a Chairman of the Board and
at all meetings of shareholders. He may do and perform all acts incident to the
office of President.

Section 5. Vice President.

                  In the absence of or inability of the President to act, the
Vice President shall perform the duties and exercise the powers of the President
and shall perform such other functions as the Board of Directors may from time
to time prescribe.

                                     BY-LAWS
                                        8
<PAGE>

Section 6. Secretary.

                  The Secretary shall:

                  (a) Keep the minutes of the meetings of the Board of Directors
and of the shareholders in appropriate books.

                  (b) Give and serve all notice of all meetings of the
Corporation.

                  (c) Be custodian of the records and of the seal of the
Corporation and affix the latter to such instruments or documents as may be
authorized by the Board of Directors.

                  (d) Keep the shareholder records in such a manner as to show
at any time the amount of shares, the manner and the time the same was paid for,
the names of the owners thereof alphabetically arranged and their respective
places of residence, or their Post Office addresses, the number of shares owned
by each of them and the time at which each person became owner, and keep such
shareholder records available daily during the usual business hours at the
office of the Corporation subject to the inspection of any person duly
authorized, as prescribed by law.

                  (e) Do and perform all other duties incident to the office of
Secretary.

Section 7. Treasurer.

                  The Treasurer shall:

                  (a) Have the care and custody of and be responsible for all of
the funds and securities of the Corporation and deposit of such funds in the
name and to the credit of the Corporation in such a bank and safe deposit vaults
as the directors may designate.

                  (b) Exhibit at all reasonable times his books and accounts to
any director or shareholder of the Corporation upon application at the office of
the Corporation during business hours.

                  (c) Render a statement of the condition of the finances of the
Corporation at each stated meeting of the Board of Directors if called upon to
do so, and a full report at the annual meeting of shareholders. He shall keep at
the office of the Corporation correct books of account of all of its business
and transactions and such books of account as the Board of Directors may
require. He shall do and perform all other duties incident to the office of
Treasurer.

                  (d) Give the Corporation security for the faithful performance
of his duties in such sum and with such surety as the Board of Directors may
require.

Section 8. Duties of Officers May be Delegated.

                  In the case of the absence of any officer of the Corporation,
or for any reason the Board may deem sufficient, the Board may, except as
otherwise provided in these By-Laws, delegate the powers or duties of such
officers to any other officer or any director for the time being, provided a
majority of the entire Board concur therein.

                                     BY-LAWS
                                        9

<PAGE>

Section 9. Vacancies - How Filled.

                  Should any vacancy in any office occur by death, resignation
or otherwise, the Board of Directors may appoint any qualified person to fill
such vacancy, without undue delay, at its next regular meeting or at a special
meeting called for that purpose, except as otherwise provided in the Certificate
of Incorporation.

Section 10. Compensation of Officers.

                  The officers shall receive such salary or compensation as may
be fixed and determined by the Board of Directors, except as otherwise provided
in the Certificate of Incorporation. No officer shall be precluded
from receiving any compensation by reason of the fact that he is also a
director of the Corporation.

                                     BY-LAWS
                                       10

<PAGE>

                  ARTICLE IV. CERTTFICATES REPRESENTING SHARES

Section 1. Issue of Certificates Representing Shares.

                  The President shall cause to be issued to each shareholder one
or more certificates, under the seal of the Corporation, signed by the President
(or Vice-President) and the Treasurer (or Secretary) certifying the number of
shares owned by him in the Corporation. Each certificate shall state upon the
face thereof: (1) That the Corporation is formed under the laws of this state.
(2) The name of the person or persons to whom issued. (3) The number and class
of shares, and the designation of the series, if any, which such certificate
represents. Any restrictions upon transfers imposed by the Corporation should be
conspicuously noted on the certificate.

Section 2. Lost, Destroyed and Stolen Share Certificates.

                  The holder of any certificate representing shares of the
Corporation shall immediately notify the corporation of any loss, destruction or
wrongful taking of the certificate representing the same. The Corporation may
issue a new certificate in the place of any certificate thereto issued by it,
alleged to have been lost, destroyed or wrongfully taken. On production of such
evidence of loss as the Board of Directors in its discretion may require, the
Board of Directors may require the owner of the missing certificate, or his
legal representatives, to give the Corporation a bond in such sum as the Board
may direct, and with such surety or sureties as may be satisfactory to the
Board, to indemnify the Corporation against any claims, loss, liability or
damage it may suffer on account of the issuance of the new certificate. A new
certificate may be issued without requiring any such evidence or bond when, in
the judgment of the Board of Directors, it is proper so to do.

Section 3. Transfers of Shares.

                  (a) Transfers of shares of the Corporation shall be made on
the shares records of the Corporation only by the holder of record thereof, in
person or by his duly authorized attorney, upon surrender for cancellation of
the certificate or certificates representing such shares, with an assignment or
power of transfer endorsed thereon or delivered therewith, duly executed, with
such proof of the authenticity of the signature and of authority to transfer and
of payment of transfer taxes as the Corporation or its agents may require.

                  (b) The Corporation shall be entitled to treat the holder of
record of any share or shares as the absolute owner thereof for all purposes
and, accordingly, shall not be bound to recognize any legal, equitable or other
claim to, or interest in, such share or shares on the part of any other person,
whether or not it shall have express or other notice thereof, except as
otherwise expressly provided by law.

                                     BY-LAWS
                                       11
<PAGE>

                                 ARTICLE V. SEAL

                The seal of the Corporation shall be as follows:

                          ARTICLE VI. INDEMNIFICATION.

                  The Corporation shall indemnify any person, made a party to an
action by or in the right of the corporation to procure a judgment in its favor
by reason of the fact that he, his testator or intestate, is or was a director,
officer, or employee of the Corporation, against the reasonable expenses,
including attorneys' fees, actually and necessarily incurred by him in
connection with the defense of such action, or in connection with an appeal
therein, except in relation to matters as to which such person is adjudged to
have breached his duty to the Corporation. The Corporation shall indemnify any
person made a party to an action against judgments, fines, amounts paid in
settlement and reasonable expenses, including attorneys' fees actually and
necessarily incurred as a result of such action, if such person acted in good
faith, for a purpose which he reasonably believed to be in the best interests of
the Corporation, and, in criminal actions, had no reasonable cause to believe
that his conduct was unlawful. Such rights of indemnifiation shall not exclude
other rights to which such person may be entitled.

                  ARTICLE VII. DIVIDENDS OR OTHER DISTRIBUTIONS

                  The Corporation, by vote of the Board of Directors, may
declare and pay dividends or make other distributions in cash or its bonds or
its property on its outstanding shares to the extent as provided and permitted
by law, unless contrary to any restriction contained in the Certificate of
Incorporation.

                       ARTICLE VII. NEGOTIABLE INSTRUMENTS

              All checks, notes or other negotiable instruments shall be signed
on behalf of this Corporation by such of the officers, agents and employees as
the Board of Directors may from time to time designate, except as otherwise
provided in the Certificate of Incorporation.

                             ARTICLE IX. FISCAL YEAR

              The fiscal year of the Corporation shall be determined by
resolution of the Board Director.

                                     BY-LAWS
                                       12
<PAGE>

                              ARTICLE X. AMENDMENTS

Section 1. By Shareholders.

                  All by-laws of the Corporation shall be subject to alteration
or repeal, and new by-laws may be made, by a majority vote of the shareholders
at the time entitled to vote in the election of directors.

Section 2.  By Directors.

                  The Board of Directors shall have power to make, adopt, alter,
amend and repeal, from time to time, the by-laws of the Corporation; provided,
however, that the shareholders entitled to vote with respect thereto, as in this
Article X above-provided, may alter, amend or repeal by-laws made by the Board
of Directors; except that the Board of Directors shall have no power to change
the quorum for meetings of shareholders or of the Board of Directors, or to
change any provisions of the by-laws with respect to the removal of directors or
the filling of vacancies in the Board resulting from the removal by the
shareholders. If any by-law regulating an impending election of directors is
adopted, amended or repealed by the Board of Directors, there shall be set forth
in the notice of the next meeting of shareholders for the election of directors,
the by-law so adopted. amended or repealed, together with a concise statement of
the changes made therein.

                               ARTICLE XI. OFFICES

                  The offices of the Corporation shall be located in the City,
County and State designated in the Certificate of Incorporation. The Corporation
may also maintain offices at such other places within or without the United
States as the Board of Directors may, from time to time, determine.

                  The undersigned Incorporator certifies that he has adopted the
foregoing by-laws as the first by-laws of the Corporation, in accordance with
the requirements of the Business Corporation Law.

Dated:_____________________

                                                  ------------------------------
                                                           Incorporator

                                     BY-LAWS
                                       13

<PAGE>

                                SCHEDULE 3.04(a)

                            RIT Financial Statements

<PAGE>

                           RIT AUTO LEASING GROUP, INC

              REPORT ON REVIEW OF COMPARATIVE FINANCIAL STATEMENTS

                 FOR THE YEARS ENDED DECEMBER 31, 1997 AND 1996

<PAGE>

                              Kornelia M. Seyfried
                        Certified Public Accountant, P.C.

                              2103 Deer Park Avenue
                                    Suite 202
                            Deer Park, New York 11729
                              --------------------
                                Tel. 516-242-8194
                                Fax. 516-242-8209

Rit Auto Leasing Group Inc.
90 Jericho Turnpike
Floral Park, NY 11001

To the Board of Directors:

I have reviewed the accompanying balance sheets and statements of income,
expenses and retained earnings and statements of cash flows for the years ended
December 31, 1997 and 1996 in accordance with standards established by the
American Institute of Certified Public Accountants.

A review of financial information consists principally of obtaining an
understanding of the system for preparation of financial information, applying
analytical review procedures of financial information, inquiries of persons
responsible for financial and accounting matters. It is substantially less in
scope than an examination in accordance with generally accepted auditing
standards, the objective of which is the expression of an opinion regarding the
financial statements taken as a whole. Accordingly, I do not express such an
opinion.

Based on my review, I am not aware of any material modifications that should be
made to the accompanying financial statements for them to be in conformity with
generally accepted accounting principles.

April 15, 1998
Deer Park, New York

<PAGE>
<TABLE>
<CAPTION>

                                                       RIT AUTO LEASING GROUP INC.
                                                        COMPARATIVE BALANCE SHEET
                                                            AS OF DECEMBER 31,

************************************************************************************************************************************

                          ASSETS
                                                                                         1997              1996
<S>                                                                                      <C>               <C>
Cash in Bank                                                                            $85,793          $  46,384
Accounts Offlease Receivable (Net of an allowance of $244,185 & $18,500)               476,471             21,036
Investment in Direct Financing Leases (Note & B)                                      7,112,736          7,856,396
Vehicle Inventory (Note A)                                                              569,558            743,426
Automobiles held under Operating Leases                                                 634,161            618,512
Net of accumulated depreciation of $555,573 and $303,673
(Note A & B)
Office Furniture & Equipment & leasehold Improvements
Net of Accumulated Depreciation of $45,954 & $30,308                                    113,046            128,692
Other Assets - Due From Related Party (Note F)                                                0                  0
                Security Deposits                                                         7,775              7,775
                                                                                     ----------         ----------

Total Assets                                                                         $8,999,540         $9,152,221
                                                                                     ==========         ==========

           LIABILITIES AND STOCKHOLDERS' EQUITY

LIABILITIES
Loans Payable (Note B)                                                               $7,458,486         $7,413,543
Accounts Payable                                                                        154,891             83,795
Taxes Payable                                                                             5,099                  0
Deferred Taxes Payable (Note E)                                                         134,000            445,000
                                                                                     ----------         ----------
  Total Liabilities                                                                   7,752,476          7,942,338
                                                                                     ----------         ----------
STOCKHOLDERS' EQUITY
Common Stock (Note A)                                                                   150,000            150,000
Retained Earnings                                                                     1,097,064          1,059,883
                                                                                     ----------         ----------
  Total Stockholders' Equity                                                          1,247,064          1,209,883
                                                                                     ----------         ----------
Total Liabilities and Stockholders' Equity                                           $8,999,540         $9,152,221
                                                                                     ==========         ==========
</TABLE>

         See Accountants' Review Letter & Notes to Financial Statements

<PAGE>
<TABLE>
<CAPTION>

                                                  RIT AUTO LEASING GROUP INC.
                                COMPARATIVE STATEMENT OF REVENUE, EXPENSES & RETAINED EARNINGS
                                               FOR THE YEARS ENDED DECEMBER 31,

************************************************************************************************************************************

                                                                                                  1997              1996
<S>                                                                                               <C>               <C>
Leasing Income

Rental Income Operating Leases (Note A- B)                                                     $  262,229      $   287,760
Amortization of Unearned Lease Income (Note A)                                                    604,198        1,224,562
Gain On Sale of Auto's (Note A-F)                                                                 680,832          655,948
                                                                                               ----------       ----------
Total Leasing Income                                                                            1,547,259        2,168,270

Interest Expense                                                                                  811,760          814,684
Amortization of Initial Direct Cost                                                                23,798           24,391
Depreciation Expense Operating Leases (Note A- B)                                                 284,538          251,900
                                                                                               ----------       ----------
Total Directly Related Leasing Cost                                                             1,120,096        1,090,975
                                                                                               ----------       ----------
Gross Profit                                                                                      427,163        1,077,295
                                                                                               ----------       ----------
Operating Expenses:

Salaries & Wages                                                                                  104,732          117,523
Rent & Related Taxes                                                                               75,550           47,648
Promotional & Entertainment                                                                        62,820           26,376
Medical and Insurance                                                                              40,003           14,764
Telephone & Utilities                                                                              19,933           22,307
Professional Fees                                                                                  18,908           87,481
Depreciation - Furniture                                                                           15,646           17,646
Office & Administrative Expense                                                                    13,141           27,076
Payroll Taxes                                                                                      10,425           12,460
Federal Express and Postage                                                                         5,055            3,935
Cleaning and Maintenance                                                                            1,355            3,853
                                                                                               ----------       ----------
  Total Operating Expenses                                                                        367,568          381,069
                                                                                               ----------       ----------
Income From Operations Before Provision for Taxes                                                  59,595          696,226

Provision for Taxes (Note E)                                                                       14,000          301,075
                                                                                               ----------       ----------
Net Income                                                                                         45,595          395,151

Retained Earnings - Beginning of Year                                                           1,059,883           53,752
Dividends                                                                                          (8,414)         189,020
                                                                                               ----------       ----------
Retained Earnings - End of Year                                                                $1,097,064       $1,059,883
                                                                                               ==========       ==========
</TABLE>

         See Accountant's Review Letter & Notes to Financial Statements

<PAGE>

                          RIT AUTO LEASING GROUP, INC.
                       COMPARATIVE STATEMENT OF CASH FLOW
                        FOR THE YEARS ENDED DECEMBER 31,

********************************************************************************

<TABLE>
<CAPTION>
                                                                                                    1997             1996
<S>                                                                                           <C>                <C>
CASH FLOWS FROM OPERATING ACTIVITIES
Net Income                                                                                    $    45,595        $   395,151
  Adjustments to Reconcile Net Income to
Net Cash Provided by Operating Activities:
  Depreciation and Amortization                                                                   300,184            269,546
  (Increase) Decrease in:
    Accounts Receivable                                                                          (455,435)           235,394
    Inventory                                                                                     (96,132)           170,948
    Due from Related Party                                                                              0             54,708
    Security Deposits                                                                                   0             (2,000)
  Increase (Decrease) in:
    Taxes Payable                                                                                (305,903)           297,563
    Accounts Payable                                                                               71,096             30,809
    Due to Related Party                                                                                0            (18,500)
                                                                                              -----------        -----------
NET CASH PROVIDED (USED) BY OPERATING
ACTIVITIES                                                                                       (440,595)         1,433,619
                                                                                              -----------        -----------

CASH FLOWS FROM INVESTING ACTIVITIES
Investment in Direct Financing Leases                                                             743,660          1,188,200
Investment in Operating Leases                                                                   (300,187)          (201,824)
Purchases of Property and Equipment                                                                     0                  0
Dividends Paid                                                                                     (8,414)          (189,020)
                                                                                              -----------        -----------

NET CASH PROVIDED BY (USED) BY INVESTING
ACTIVITIES                                                                                        435,059            797,356
                                                                                              -----------        -----------

CASH FLOWS FROM FINANCING ACTIVITIES
New borrowings                                                                                  1,783,750          2,898,870
Debt--reduction                                                                                (1,738,805)        (5,126,153)
                                                                                              -----------        -----------

NET CASH PROVIDED BY (USED) BY
FINANCING ACTIVITIES                                                                               44,945         (2,227,283)
                                                                                              -----------        -----------

NET INCREASE (DECREASE) IN CASH                                                                    39,409              3,692

CASH AT BEGINNING OF YEAR                                                                          46,384             42,692
                                                                                              -----------        -----------
CASH AT END OF YEAR                                                                               $85,793            $46,384
                                                                                              ===========        ===========
</TABLE>

        See Accountant's Review Report and Notes to Financial Statements

<PAGE>

                           RIT AUTO LEASING GROUP, INC
                          NOTES TO FINANCIAL STATEMENTS
                 FOR THE YEARS ENDED DECEMBER 31, 1997 AND 1996

********************************************************************************

NOTE A                  Summary of Significant Accounting Policies

                        The company was incorporated under the laws of the State
                        of New York with an authorized capital of 200 shares
                        common stock, no par value. The company is engaged in
                        the arranging of financing of automobiles on a long term
                        basis.

                        1) Cash and Cash Equivalents

                        For purposes of the statement of cash flows, the company
                        considers cash and cash equivalents to include cash on
                        hand, amount due from banks and other high liquid debt
                        instruments purchased with a maturity of three months or
                        less.

                        2)  Revenue Recognition and Lease Classifications

                        The company is engaged in long-term leasing of vehicles
                        with terms generally ranging from twelve to sixty
                        months. Substantially all vehicles are financed on a
                        lease by lease basis through recourse notes payable.

                        Leases are either classified as direct financing leases
                        or as operating leases.

                        a) Direct Financing Leases

                           Includes all leases containing open-end lessee
                           purchase options and/or bargain purchase options.

                           Open-end lessee purchase options require each lessee
                           upon termination to either purchase the related
                           vehicle for the stated option price or, if returned,
                           to be responsible for any deficiency between the
                           stated option price and the eventual amount realized
                           by the company upon the vehicles disposition.

<PAGE>

                           RIT AUTO LEASING GROUP, INC
                          NOTES TO FINANCIAL STATEMENTS
                 FOR THE YEARS ENDED DECEMBER 31, 1997 AND 1996

********************************************************************************

NOTE A                  Summary of Accounting Policies (continued)

                        Direct financing leases also include certain leases
                        containing closed-end Lessee options whereby the company
                        expects the lessee to purchase (although not a
                        requirement) the vehicle for the stated option price.
                        The majority of these leases are situations where large
                        capital cost reductions were made and/or option prices
                        are well below the anticipated value of the related
                        vehicle.

                        The investment in direct financing leases includes all
                        future lease payments and the lessee purchase options of
                        the respective vehicles, net of unearned income.

                        Revenue under the direct financing leases is accounted
                        for by recognizing the excess of aggregate rentals
                        receivable and lessee purchase options over the cost of
                        the leased vehicles during the term of the lease in
                        decreasing amounts related to the declining balance of
                        the unrecovered cost.

                        b) Operating Leases

                        Operating leases consists of vehicles which do not meet
                        the direct financing lease criteria. The majority of
                        these leases contain closed-end lessee purchase options,
                        or closed end leases with no purchase option.

                        Vehicles which are classified as operating leases are
                        stated at cost less accumulated depreciation and
                        unamortized capital cost reduction payment.

                        Depreciation is computed on a straight-line basis over
                        the terms of the leases to estimated residual values at
                        expiration of the lease periods.

                        Rentals from operating leases are recognized as revenue
                        over the life of the lease on the straight-line basis
                        and expenses are charged against such revenue as
                        incurred.

                        Initial lessee capital cost reduction payments are
                        amortized on a straight line basis consistent with
                        depreciation periods.

                        Initial direct costs are included as a component of the
                        equipment held and are amortized on a straight-line
                        basis over the lives of the related leases.

<PAGE>

                          RIT AUTO LEASING GROUP, INC.
                    NOTES TO COMPARATIVE FINANCIAL STATEMENTS
                 FOR THE YEARS ENDED DECEMBER 31, 1997 AND 1996

********************************************************************************

NOTE A                  Summary of Accounting Policies (continued)

                        c) Vehicle Inventory

                        Represents vehicles returned upon lease termination's
                        and held for sale or re-lease. Amounts are stated at the
                        lower of net book value or market. It is management's
                        estimate that the fair market value of their offlease
                        and paid off vehicles is $698,000.00. Subsequent to the
                        issuance of this report, the Company has liquidated
                        $190,950 of this inventory.

                        d) Property and Equipment

                        Depreciation of property and equipment is computed on
                        the straight-line method over the estimated useful lives
                        of the related assets.

                        e) Net Leasing Income

                        Income from leasing activities includes revenues from
                        direct financing leases, rentals from operating leases
                        and proceeds from sales of vehicles. Cost and expenses
                        primarily represent the net book value of vehicles sold.

                        f) Gain on Sale of Autos'

                        Represents the net gain derived from the sale of auto's
                        classified as operating leases.

                                                           1997        1996
                        Gross Sales Proceeds             $860,382    $826,916
                        Net Depreciated Basis            $179,550    $170,948
                                                         --------    --------
                        Gain on Sale                     $680,832    $655,968
                                                         --------    --------

NOTE B                  Investment in Direct Financing Leases

                        The investment in direct financing leases consists of
                        the following.

                                                            1997        1996
                        Future Lease payments           $6,213,946   $7,406,264
                        Lease purchase Options           2,583,711    2,338,820
                                                        ----------   ----------
                                                        $8,797,657   $9,745,084

                        Unearned income (net of
                          unamortized initial direct
                          costs)                         1,708,359    1,888,688
                                                        ----------   ----------
                                                        $7,112,736   $7,856,396
                                                        ==========   ==========

                        In the opinion of Management, no allowance for
                        uncollectibles was deemed necessary.

                        Future Lease payments and lessee purchase options due
                        are summarized as follows:

<PAGE>

                           RIT AUTO LEASING GROUP INC.
                          NOTES TO FINANCIAL STATEMENTS
                 FOR THE YEARS ENDED DECEMBER 31, 1997 AND 1996

********************************************************************************

NOTE B                 Investment In Direct Financing Leases (continued)

                       Year ending December 31     1997              1996
                       -----------------------
                              1996             $    -0-           $2,241,639
                              1997              3,325,912          2,319,083
                              1998              2,089,617          2,093,112
                              1999              1,297,621          1,297,863
                              2000                892,001          1,195,040
                              2001                619,221            598,347
                              2002                573,285                -0-
                                               ----------         ----------
                                               $8,797,657         $9,745,084
                                               ==========         ==========

NOTE C                 Operating Leases

                       Future minimum rental payments due, (excluding
                       unguaranteed residual values of approximately $244,905
                       and $378,125) are summarized as follows:

                       Year ending December 31     1997               1996
                       -----------------------
                              1997                $   -0-           $231,435
                              1998                239,070            185,148
                              1999                191,111            111,089
                              2000                114,753             92,574
                              2001                 95,114             46,287
                              2002                 24,237                -0-
                                                 --------           --------
                                                 $664,285           $666,533
                                                 ========           ========

NOTE D                 Loans Payable

                       Represents borrowings for leased vehicles under several
                       separate credit facilities which are materially identical
                       in their terms and conditions. The obligations are
                       collateralized by the leases and first lien on each
                       vehicle. The shareholders have also guaranteed the loans.
                       The obligations are payable on a monthly basis. Interest
                       range from 8% to 14% per annum.

<PAGE>

                           RIT AUTO LEASING GROUP INC.
                          NOTES TO FINANCIAL STATEMENTS
                  FOR THE YEARS ENDED DECEMBER 31, 1997 AND 1996

********************************************************************************

NOTE E            Income Taxes

                  Income taxes are provided for the tax effects of the
                  transactions reported on the financial statements and consists
                  of taxes currently due, plus deferred taxes. Deferred taxes
                  are recorded to provide for differences between the basis of
                  assets and liabilities for financial and income tax purposes.
                  The differences relate to, primarily, to revenue recognition
                  and depreciation expense for assets for leasing transactions.
                  The deferred taxes payable represent the future tax
                  consequences of those differences. These differences will be
                  taxable when the liability is settled.

NOTE F            Related Party Transactions

                  The Company leases space from a related party. The minimum
                  annual rental payments are $72,000. per annum, plus
                  escalation's. In 1997 and 1996 rent expenses to the related
                  party was $75,550 and $47,648 respectively.

<PAGE>

                                SCHEDULE 3.04(b)

                             RIT Income Tax Returns

<PAGE>

                                  SCHEDULE 3.08

                                 RIT Litigation<PAGE>   1
                                                                    Exhibit 10.4

                              EMPLOYMENT AGREEMENT

                                     BETWEEN

                       LK GLOBAL INFORMATION SYSTEMS, B.V.
                                       AND
                           DR. LYCOURGOS K. KYPRIANOU

         THIS EMPLOYMENT AGREEMENT (the "Agreement"), dated June __, 1999, is
entered into by and between LK Global Information Systems, B.V., a Netherlands
corporation (the "Company") and Dr. Lycourgos K. Kyprianou (the "Executive"),
collectively referred to herein as the "parties."

         WHEREAS, the Company wishes to employ the Executive to serve as Chief
Executive Officer and Chairman of the Board of Directors (the "Board") of the
Company and its subsidiary corporations; and

         WHEREAS, the Company also wishes to have Executive serve, without
additional compensation, as the Chief Executive Officer and Chairman of the
Board of Directors of its parent, AremisSoft Corporation, a Delaware Corporation
("AremisSoft").

         NOW, THEREFORE, for and in consideration of the mutual promises and
conditions made herein and for other good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, the parties hereby
agree as follows.

                                    ARTICLE I
                        EMPLOYMENT AND TERM OF EMPLOYMENT

         1.1. EMPLOYMENT AND TERM. The Company hereby employs Executive to
render full-time services to the Company on an exclusive basis, upon the terms
and conditions set forth below, from the date of this Agreement until the
employment relationship is terminated in accordance with the provisions of this
Agreement. This Agreement is for a term of three (3) years (the "Stated Term")
unless terminated earlier as provided for herein (the "Employment Term").

         1.2. ACCEPTANCE. Executive hereby accepts employment with the Company
and agrees to devote his full-time attention and best efforts exclusively to
rendering the services described below. The Executive shall accept and follow
the direction and authority of the Board and the AremisSoft Board of Directors
(the "AremisSoft Board"), as appropriate. In the performance of his duties he
shall comply with all existing and future regulations applicable to employees of
the Company and to the Company's business.

                                       1
<PAGE>   2
         1.3. TERMINATION OF PRIOR AGREEMENTS. Upon execution of this Agreement
all prior employment agreements between Executive and the Company, its
subsidiaries or AremisSoft shall be deemed terminated and there shall be no
right to severance or other related benefits thereunder.

                                   ARTICLE II
                               DUTIES OF EMPLOYEE

         2.1. GENERAL DUTIES. Executive shall serve as Chief Executive Officer
and Chairman of the Board of Directors of the Company and its subsidiaries. In
such capacities, Executive shall do and perform all services, acts, or other
things necessary or advisable to manage and conduct the business of the Company,
including, but not limited to, the supervision, direction and control of the
business and other employees of the Company and its subsidiaries, subject to the
policies and direction of the Board. To the extent consistent with the Company's
and the Company's subsidiaries' charter documents (i.e. articles and bylaws),
Executive shall have all powers, duties and responsibilities necessary to carry
out his duties, and such other powers and duties as the Board may prescribe
consistent with such charter documents.

         2.2. SPECIAL DUTIES. Executive shall also serve, without additional
compensation, as Chief Executive Officer and Chairman of the Board of Directors
of the Company's parent, AremisSoft. In such capacities, Executive shall do and
perform all services, acts, or other things necessary or advisable to manage and
conduct the business of AremisSoft, including, but not limited to, the
supervision, direction and control of the business and other employees of
AremisSoft, subject to the policies and direction of the AremisSoft Board. To
the extent consistent with AremisSoft's Certificate of Incorporation
("articles") and Bylaws ("bylaws"), Executive shall have all powers, duties and
responsibilities necessary to carry out his duties, and such other powers and
duties as the AremisSoft Board may prescribe consistent with its articles and
bylaws.

         2.3. EXCLUSIVE SERVICES. It is understood and agreed that the Executive
may not engage in any other business activity during the Employment Term,
whether or not for profit or other remuneration, without the prior written
consent of the Company; provided, however, that the Executive may make personal
financial investments which do not involve any material active participation on
his part, and may engage in charitable, philanthropic, educational, religious,
civic and similar types of activities to the extent that such activities do not
hinder or otherwise interfere with the business of the Company, its parent or
subsidiaries, or the performance of the Executive's duties under this Agreement.
Notwithstanding the foregoing, during the Employment Term, Executive shall not
directly or indirectly acquire any stock or interest in any corporation,
partnership, or other business entity that competes, directly or indirectly,
with the business of the Company, its parent or subsidiaries, without obtaining
the prior written consent of the Company.

         It is also understood and agreed that the Executive will not compete
with the Company during the Employment Term. For purposes of this Agreement, the
phrase "compete with the Company," or the substantial equivalent thereof, means
that Executive, either alone or as a partner, member, director, employee,
shareholder or agent of any other business, or in any other individual

                                       2
<PAGE>   3
or representative capacity, directly or indirectly owns, manages, operates,
controls, or participates in the ownership, management, operation or control of,
or works for or provides consulting services to, or permits the use of his name
by, or lends money to, any business or activity which is or which becomes, at
the time of the acts or conduct in question, directly or indirectly competitive
with the development, financing and/or marketing of the products, proposed
products or services of the Company, its parent or subsidiaries.

         2.4. REPORTING OBLIGATIONS. In connection with the performance of his
duties hereunder, the Executive shall report directly to the Board for all
matters concerning the Company and its subsidiaries and to the AremisSoft Board
for all matters concerning AremisSoft.

                                   ARTICLE III
                      COMPENSATION AND BENEFITS OF EMPLOYEE

         3.1. ANNUAL BASE SALARY. The Company shall pay the Executive salary for
the services to be rendered by him, to the Company and its subsidiaries, during
the term of this Agreement at the rate of U.S. Two Hundred Fifty Thousand
Dollars (US $250,000) annually (prorated for any portion of a year), subject to
increases, if any, as the Company's Compensation Committee or Board may
determine in its discretion after periodic review of the Executive's performance
of his duties hereunder. Such base salary shall be payable in periodic
installments in accordance with the terms of the Company's regular payroll
practices in effect from time to time during the term of this Agreement, but in
no event less frequently than once each month.

         3.2. BONUSES. In addition to the base salary and other benefits
provided to Executive hereunder, Executive is eligible to receive bonuses,
periodically, at the discretion of the Board or Compensation Committee.

         3.3. STOCK OPTIONS. Executive may be granted stock options to purchase
shares of the Company's or AremisSoft's common stock, as determined from time to
time by the Board or the AremisSoft Board or their respective compensation
committees and subject to (a) the terms and conditions contained in the
applicable stock option plans, (b) the terms and conditions set forth herein and
(c) the Executive's execution of a stock option agreement and all documents
customarily required by the Company or AremisSoft to effect the grant of the
options.

         3.4. EXPENSES. The Company shall pay or reimburse the Executive for all
reasonable, ordinary and necessary business expenses actually incurred or paid
by the Executive in the performance of Executive's services under this Agreement
in accordance with the expense reimbursement policies of the Company in effect
from time to time during the Employment Term, upon presentation of proper
expense statements or vouchers or such other written supporting documents as the
Company may reasonably require.

                                       3
<PAGE>   4
         3.5. VACATION. The Executive shall be entitled to four (4) weeks paid
vacation for each calendar year (prorated for any portion of a year, as
applicable). Notwithstanding anything to the contrary in this Agreement,
vacation time shall cease to accrue beyond eight weeks at any given time during
the Employment Term.

         3.6. INDEMNIFICATION. Consistent with the terms of the Company's and
AremisSoft's charter documents, the Executive shall be indemnified against any
losses, costs, damages or expenses incurred as a direct consequence of the
discharge of his duties or by reason of his status as an agent and hold
Executive harmless for any actions taken or decisions made by him in good faith
while performing services in his capacity as Chief Executive Officer and
Chairman of the Board of Directors of the Company, its subsidiaries and parent,
during the Employment Term.

         3.7. GENERAL EMPLOYMENT BENEFITS. Except where expressly provided for
herein, the Executive shall be entitled to participate in, and to receive the
benefits under, any pension, health, life, accident and disability insurance
plans or programs and any other employee benefit or fringe benefit plans that
the Company makes available generally to its employees, as the same may be in
effect from time to time during the Employment Term.

                                   ARTICLE IV
                            TERMINATION OF EMPLOYMENT

         4.1. TERMINATION. This Agreement may be terminated earlier as provided
for in this Article IV, or extended by further written agreement of the parties.

         4.2. TERMINATION FOR CAUSE. The Company reserves the right to terminate
this Agreement for cause upon: (a) Executive's willful and continued failure to
substantially perform his duties with the Company (other than such failure
resulting from his incapacity due to physical or mental illness) (b) Executive's
willful engagement in gross misconduct, as determined by the Board, which is
materially and demonstrably injurious to the Company; or (c) Executive's
commission of a felony, or an act of fraud against the Company or its parent or
subsidiaries.

         Executive shall not be entitled to any severance benefits and all
options which have not vested shall be canceled upon termination for cause.

         4.3. TERMINATION WITHOUT CAUSE. Notwithstanding anything to the
contrary in this Agreement, the Company reserves the right to terminate this
Agreement at any time upon thirty (30) days written notice to Executive, without
cause, subject to the express terms and provisions below.

         4.4. SEVERANCE BENEFIT UPON TERMINATION WITHOUT CAUSE. Notwithstanding
anything to the contrary in this Agreement, if Executive is terminated without
cause, Executive shall receive a lump sum cash payment equal to the annual base
salary of Executive, as contained in Section 3.1 of this Agreement, then in
effect.

                                       4
<PAGE>   5
         4.5. VOLUNTARY TERMINATION BY EXECUTIVE. Notwithstanding anything to
the contrary in this Agreement, Executive may terminate this Agreement at any
time upon thirty (30) days written notice to the Company, subject to the terms
and provisions below.

         Other than termination "without cause", as contained in Section 4.4 of
this Agreement, or a "change of control" of the Company, as contained in Section
4.6 of this Agreement, the Company shall not be obligated to pay any severance
benefit to Executive if Executive terminates this Agreement pursuant to this
Section 4.5.

         4.6. SEVERANCE BENEFIT UPON CHANGE IN CONTROL. Notwithstanding anything
to the contrary in this Agreement, if the Company terminates this Agreement for
any reason, other than "for cause" pursuant to Section 4.2 of this Agreement,
within one hundred eighty (180) days of a "change of control" as hereinafter
defined, the Company shall pay Executive a lump sum cash payment equal to 2.99
times the annual base salary of Executive, as contained in Section 3.1 of this
Agreement, or Executive's then current rate of compensation, whichever is
greater. For purposes of this Section 4.6, a "change of control" shall mean an
event involving one transaction or a series of related transactions in which (i)
the Company or AremisSoft issues securities equal to more than fifty percent
(50%) of the issued and outstanding capital stock of the Company or AremisSoft
to any individual, firm, partnership, or other entity, including a "group"
within the meaning of Section 13(d)(3) of the Securities Exchange Act of 1934
(the "Exchange Act"), (ii) the Company or AremisSoft issues securities equal to
more than fifty percent (50%) of the issued and outstanding capital stock of the
Company or AremisSoft in connection with a merger, consolidation or other
business combination (other than for purposes of reincorporation), (iii) the
Company or AremisSoft is acquired in a merger or other business combination
transaction in which the Company or AremisSoft is not the surviving corporation
(other than a reincorporation), or (iv) more than fifty percent (50%) or more of
the Company's or AremisSoft's consolidated assets or earning power are sold or
transferred.

         4.7. DISABILITY. If Executive becomes permanently and totally disabled,
this Agreement shall be terminated. Executive shall be deemed permanently and
totally disabled if he is unable to engage in the activities required by this
Agreement by reason of any medically determinable physical or mental impairment,
as confirmed by three independent physicians, which can be expected to result in
death or which has lasted or can be expected to last for a continuous period of
not less than 12 months. Upon termination due to disability, Executive shall be
entitled to receive a lump sum payment equal to his annual base salary, as
contained in Section 3.1 of this Agreement, then in effect.

         4.8. DEATH. If Executive dies during the term of this Agreement, this
Agreement shall be terminated on the last day of the calendar month of his death
subject to the express terms and provisions below.

         Upon termination due to death, the designated beneficiary, as provided
in Section 6.8 below, or the estate or representative of Executive, shall be
entitled to receive a lump sum payment equal to his annual base salary, as
contained in Section 3.1 of this Agreement, then in effect.

                                       5
<PAGE>   6
         4.9. EFFECT OF TERMINATION. Except as expressly provided for in this
Agreement, the termination of employment shall not impair any obligation that
accrued prior to termination, nor shall it excuse the performance of any
obligation which is required or contemplated hereunder to be performed after
termination, and any such obligation shall survive the termination of employment
and this Agreement.

                                    ARTICLE V
                    COVENANTS AND REPRESENTATIONS OF EMPLOYEE

         5.1. UNFAIR AND NON-COMPETITION. The Executive acknowledges that he
will have access at the highest level to, and the opportunity to acquire
knowledge of, the Company's customer lists, customer needs, business plans,
trade secrets and other confidential and proprietary information from which the
Company may derive economic or competitive advantage, and that he is entering
into the covenants and representations in this Article V in order to preserve
the goodwill and going concern value of the Company, and to induce the Company
to enter into this Agreement. The Executive agrees not to compete with the
Company or to engage in any unfair competition with the Company during the
Employment Term, but not limited to the acts and conduct described below.

         5.2. CONFIDENTIAL INFORMATION. During the Employment Term, Executive
agrees to keep secret and to retain in the strictest confidence all confidential
matters which relate to the Company or its "affiliate" (as that term is defined
in the Exchange Act), including, without limitation, customer lists, client
lists, trade secrets, pricing lists, business plans, financial projections and
reports, business strategies, internal operating procedures, and other
confidential business information from which the Company derives an economic or
competitive advantage, or from which the Company might derive such advantage in
its business, labeled "secret" or "confidential" or some similar term, and not
to disclose any such information to anyone outside of the Company, whether
during or after the Employment Term, except as required in connection with
performing the services to the Company.

         5.3. NON-SOLICITATION OF CUSTOMERS. During the Employment Term, the
Executive will have access to confidential records and data pertaining to the
Company's customers, their needs, and the relationship between the Company and
its customers. Such information is considered secret and is disclosed during the
Employment Term in confidence. Accordingly, during the Employment Term,
Executive and any entity controlled by him or with which he is associated (as
the terms "control" and "associate" are defined in the Exchange Act) shall not,
directly or indirectly (i) solicit for a competitive purpose, interfere with,
induce or entice away any person or entity that is or was a client, customer or
agent of the Company or its affiliates (as the term "affiliate" is defined in
the Exchange Act), or (ii) in any manner persuade or attempt to persuade any
such person or entity (A) to discontinue its business relationship with the
Company or its affiliates, or (B) to enter into a business relationship with any
other entity or person the loss of which the Executive should reasonably
anticipate would be detrimental to the Company or its affiliates in any respect.

                                       6
<PAGE>   7
         5.4. NON-SOLICITATION OF EXECUTIVES. The Executive and any entity
controlled by him or with which he is associated (as the terms "control" and
"associate" are defined in the Exchange Act) shall not, during the Employment
Term, directly or indirectly solicit, interfere with, offer to hire or induce
any person who is or was an officer or employee of the Company or any affiliate
(as the term "affiliate" is defined in the Exchange Act) (other than secretarial
personnel) to discontinue his or her relationship with the Company or an
affiliate of the Company, in order to accept employment by, or enter into a
business relationship with, any other entity or person. (These acts are
hereinafter referred to as the "prohibited acts of solicitation.") The foregoing
restriction, however, shall not apply to any business with which Executive may
become associated after the Employment Term.

         5.5. RETURN OF PROPERTY. Upon termination of employment, and at the
request of the Company, the Executive agrees to promptly deliver to the Company
all Company or affiliate memoranda, notes, records, reports, manuals, drawings,
designs, computer files in any media, and other documents (including extracts
and copies thereof) relating to the Company or its affiliates, and all other
property of the Company.

         5.6. INVENTIONS. All processes, inventions, patents, copyrights,
trademarks, and other intangible rights that may be conceived or developed by
the Executive, either alone or with others, during the Employment Term, whether
or not conceived or developed during Executive's working hours, and with respect
to which the equipment, supplies, facilities or trade secret information of the
Company was used, or that relate at the time of conception or reduction to
practice of the invention to the business of the Company, or to the Company's
actual or demonstrably anticipated research or development, or that result from
any work performed by Executive for the Company, shall be the sole property of
the Company. Upon the request of the Company, Executive shall disclose to the
Company all inventions or ideas conceived during the Employment Term, whether or
not the property of the Company under the terms of this provision, provided that
such disclosure shall be received by the Company in confidence. Upon the request
of the Company, Executive shall execute all documents, including patent
applications and assignments, required by the Company to establish the Company's
rights under this provision.

         5.7. REPRESENTATIONS. The Executive represents and warrants to the
Company that he has full power to enter into this Agreement and perform his
duties hereunder, and that his execution and delivery of this Agreement and the
performance of his duties shall not result in a breach of, or constitute a
default under, any agreement or understanding, whether oral or written,
including, without limitation, any restrictive covenant or confidentiality
agreement, to which he is a party or by which he may be bound.

         5.8. NON-PAYMENT UPON NON-COMPLIANCE. Should Executive breach any one
of the covenants set forth in this Article V, the Company shall have no
obligation to make the payments or to provide Executive the benefits described
in Sections 4.4 or 4.6 above, as applicable, in addition to all other rights and
remedies the Company may have available at law or in equity. The Company shall
provide written notice to Executive, ten (10) days prior to an expected payment,
of the breach of a covenant and the ensuing non-payment thereof; provided,
however, that if the Company learns

                                       7
<PAGE>   8
of the breach without sufficient time to provide ten (10) days notice, the
Company shall provide written notice as soon thereafter as practicable.

                                   ARTICLE VI
                            MISCELLANEOUS PROVISIONS

         6.1. NOTICES. All notices to be given by either party to the other
shall be in writing and may be transmitted by personal delivery, facsimile
transmission, overnight courier or mail, registered or certified, postage
prepaid with return receipt requested; provided, however, that notices of change
of address or telex or facsimile number shall be effective only upon actual
receipt by the other party. Notices shall be delivered at the following
addresses, unless changed as provided for herein.

         To the Executive:

                           Dr. Lycourgos K. Kyprianou
                           ------------
                           ------------
                           ------------

         To the Company:

                           LK Global Information Systems B.V.
                           ------------
                           ------------
                           ------------

         With Copy to:

                           Scott E. Bartel
                           BARTEL ENG LINN & SCHRODER
                           300 Capitol Mall, Suite 1100
                           Sacramento, California 95814
                           Facsimile:  (916) 442-3442

         6.2. NO ASSIGNMENT, IN GENERAL. Except as provided below, this
Agreement, and the rights and obligations of the parties, may not be assigned by
either party without the prior written consent of the other party.

         6.3. WITHHOLDING TAXES. All amounts payable under this Agreement,
whether such payment is to be made in cash or other property, including without
limitation stock of the Company, shall be subject to governmental withholding
requirements for income taxes, employment and payroll taxes, and other legally
required withholding taxes and contributions to the extent appropriate

                                       8
<PAGE>   9
in the determination of the Company, and the Executive agrees to report all such
amounts as ordinary income on his personal income tax returns and for all other
purposes, as appropriate.

         6.4. SEVERABILITY. If any provision of this Agreement is held to be
invalid or unenforceable by any judgment of a tribunal of competent
jurisdiction, the remaining provisions and terms of this Agreement shall not be
affected by such judgment, and this Agreement shall be carried out as nearly as
possible according to its original terms and intent and, to the full extent
permitted by law, any provision or restrictions found to be invalid shall be
amended with such modifications as may be necessary to cure such invalidity, and
such restrictions shall apply as so modified, or if such provisions cannot be
amended, they shall be deemed severable from the remaining provisions and the
remaining provisions shall be fully enforceable in accordance with law.

         6.5. EFFECT OF WAIVER. The failure of either party to insist on strict
compliance with any provision of this Agreement by the other party shall not be
deemed a waiver of such provision, or a relinquishment of any right thereunder,
or to affect either the validity of this Agreement, and shall not prevent
enforcement of such provision, or any similar provision, at any time.

         6.6. DESIGNATION OF BENEFICIARY. If the Executive shall die before
receipt of all payments and benefits to which he is entitled under this
Agreement, payment of such amounts or benefits in the manner provided herein
shall be made to such beneficiary as he shall have designated in writing filed
with the Secretary of the Company or, in the absence of such designation, to his
estate or personal representative.

         6.7. ATTORNEYS FEES. In the event of any litigation arising out of this
Agreement, or the parties' performance as outlined herein, the prevailing party
shall be entitled to an award of costs, including an award of reasonable
attorney's fees.

         6.8. COUNTERPARTS. This Agreement may be executed in one or more
counterparts, each of which when taken together shall constitute one and the
same instrument.

                                        9
<PAGE>   10
         IN WITNESS WHEREOF, the parties have executed and delivered this
Agreement as of the date first above written.

COMPANY:                               LK GLOBAL INFORMATION SYSTEMS B.V.

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

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

EXECUTIVE:

                                       ----------------------------------------
                                       Dr. Lycourgos K. Kyprianou

AREMISSOFT:                            AREMISSOFT CORPORATION
(FOR PURPOSES OF SECTION
 1.3 ONLY)

                                       ----------------------------------------
                                       Roys Poyiadjis, President

                                       10

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