DOR Doriemus

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                                                            16th December, 2004

                    TEP Exchange Group Plc ("the Company")                     

          New Outsourcing Agreement signed with Surrenda-link Limited          

Highlights

  * The Outsourcing Agreement with Surrenda-link, which has been operating
    successfully for the last two years has been renewed for a period of
    further three years.
   
  * The TEP Exchange continues to be operated as the only fully independent
    real time trading platform for traded endowment policies, with the majority
    of the leading markets participants regularly trading;
   
  * The operational management of the TEP Exchange retained in Chester;
   
  * The Company continues to stabilise its cashflow position;
   
  * Fixed charges payable under old Outsourcing Agreement relaced with variable
    charges dependent on trading income;
   
  * Development of additional products by the Company and Surrenda-link to
    market to registered IFA's via the TEP Exchange's web-based service; and
   
  * Development of additional products by the Company and Surrenda-link to
    market to the public via a new website launched in September 2004.
   
Enquiries;

Ami Weitz TEP Exchange Group Plc 020 8829 4245

Paul Sands Surrenda-link Limited 01244 319520

David Worlidge John East & Partners 020 7628 2200

Simon Clements Limited

In December 2002, the Company entered into an Outsourcing Agreement with
Surrenda-link Limited ("Surrenda-link"), which is a leading market maker in
traded endowment policies and manages other related investments, which resulted
in Surrenda-link taking over the operational management of the TEP Exchange for
an initial two year period. The Company announces that the original Outsourcing
Agreement has now been terminated and that it has entered into a new
Outsourcing Agreement ("the New Outsourcing Agreement") with Surrenda-link for
it to continue conducting the operational management of the TEP Exchange for at
least the next three years.

The principal terms of the New Outsourcing Agreement are as follows:

  * The New Outsourcing Agreement is for an initial term of three years and
    thereafter will continue unless terminated by either party on six months'
    prior notice, such notice to be given no earlier than the expiry of the
    three year term.
   
  * Surrenda-link would receive no fixed charges for the services but instead
    all the charges would be payable in cash on the following variable basis:
   
TEP Exchange trading income Service charge payable to

Surrenda-link

Up to �300,000 60 per cent. of trading income

From �300,001 to �500,000 65 per cent. of trading income

From �500,001 to �700,000 70 per cent. of trading income

From �700,001 to �1,000,000 80 per cent. of trading income

In excess of �1,000,000 85 per cent. of trading income

  * Surrenda-link will advance to the Company on a quarterly basis, the lesser
    of the sum of �20,000 and the specific corporate costs (as defined in the
    agreement) incurred by the Company. The Company will utilise the quarterly
    advance from Surrenda-link to discharge the specific corporate costs. Under
    the terms of the Agreement, Surrenda-link may deduct any outstanding
    quarterly advances from the Company's net trading income. The Company has
    undertaken to use its reasonable endeavours to minimise specific corporate
    costs.
   
  * Provided that Surrenda-link are involved fully in the decision making
    process, all costs other than those mentioned specifically in the New
    Outsourcing Agreement will be the responsibility of Surrenda-link to
    discharge.
   
  * The operational management of the TEP Exchange will be retained in Chester
    and as a consequence Surrenda-link will have day-to-day operational control
    over the trading platform owned by the Company. Surrenda-link will be
    responsible to the Board of the Company on the day-to-day operational
    control over the trading platform and the Board of the Company would retain
    the right to decide on fundamental issues on the trading platform.
   
  * The Company has the option to rescind the New Outsourcing Agreement with
    Surrenda-link under certain defined circumstances.
   
  * Surrenda-link has undertaken to use reasonable endeavours to maximise
    current income as well as creating new income outside the traded endowment
    market from the trading platform of the Company.
   
Under the AIM Rules Surrenda-link, which holds 75,192,579 Ordinary Shares
representing 39.25 per cent. of the issued share capital of the Company, is a
related party. With the exception of Paul Sands and David Roxburgh, who are
directors of Surrenda-link, the Directors consider, having consulted with John
East & Partners Limited, that the terms of the New Outsourcing Agreement are
fair and reasonable insofar as that shareholders of the Company are concerned.

Current Trading

There has been a noticeable increase in activity in the traded endowment policy
market in recent months, which it is hoped will improve group performance. A
further increase in business for the Company is anticipated as a strong demand
for British traded endowment policies emerges from Germany.



END

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