Gandalf Technologies Inc. 130 Colonnade Road South Nepean, Ontario K2E 7M4 Canada Tel: 613-723-6500 Telex: 053-4728 Fax: 613-226-1717 February 21, 1994 Mr. Thomas A. Vassiliades President and Chief Executive Officer Avatar Management Services P.O. Box 423 Malvern, Pennsylvannia 19355 Dear Mr. Vassiliades: Re: Consulting Services Agreement Mr. Brian R. Hedges, President and Chief Executive Officer, has asked me to prepare a management consulting services agreement for your consideration, the general terms of which are as follows: * Services will be on an as required basis at the invitation of a senior officer of the company. * Consulting time will be at the rate of $1,000 (U.S.) per day or $125 (U.S.) per hour. * Travelling time will be paid at the above hourly rate whenever it is not feasible to travel within the normal eight hour business day. * Accommodation and travel costs while on Gandalf business will be paid by the company direct or reimbursed to you on submission of expense forms and receipts. * Automobile mileage will be paid for travel on Gandalf business at the company's prevailing rate for employees. Thomas A. Vassiliades Page 2. * A Bell Canada calling card will be issued to you on request. * Invoices and expense forms are to be submitted by you at regular intervals summarizing your professional services. * The agreement will be effective from January 16, 1994 until notified by any change. If you are in agreement with the above terms, would you please sign and return the enclosed copy of this letter. Yours very truly, D.F. MacMillan Corporate Secretary DFM:vgm cc: B.R. Hedges ACCEPTED THIS 9th DAY OF MARCH, 1994. ----------- s/THOMAS A. VASSILIADES --------------------------------------------------------- Thomas A. Vassiliades