PARK N VIEW INC, S-1/A, 1998-09-22

PARK N VIEW INC
S-1/A, 1998-09-22
COMMUNICATIONS SERVICES, NEC

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<PAGE> 1

AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON SEPTEMBER 22, 1998

REGISTRATION NO. 333-59903

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

SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
---------------------

AMENDMENT

NO. 1

FORM S-1
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
---------------------

PARK 'N VIEW, INC.
(Exact Name of Registrant as Specified in its Charter)

<TABLE>
<S> <C> <C>
DELAWARE 4899 65-0612435
(State or Other Jurisdiction of (Primary Standard Industrial (I.R.S. Employer
Incorporation or Organization) Classification Code Number) Identification Number)
</TABLE>

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

11711 N.W. 39TH STREET
CORAL SPRINGS, FLORIDA 33065
(954) 745-7800
(Address, including Zip Code, and Telephone Number, Including
Area Code, of Registrant's Principal Executive Offices)
---------------------

STEPHEN L. CONKLING

PRESIDENT AND CHIEF OPERATING OFFICER

PARK 'N VIEW, INC., 11711 N.W. 39TH STREET, CORAL SPRINGS, FLORIDA 33065
(954) 745-7800
(Name, Address, including Zip Code, and Telephone Number,
Including Area Code, of Agent for Service)
---------------------

COPIES TO:

ELIZABETH G. WREN, ESQ.
JAMES M. O'CONNELL, ESQ.
KILPATRICK STOCKTON LLP
3500 ONE FIRST UNION CENTER, CHARLOTTE, NORTH CAROLINA 28202
(704) 338-5032
---------------------

APPROXIMATE DATE OF COMMENCEMENT OF PROPOSED SALE TO THE PUBLIC: As soon
as practicable after the Registration Statement becomes effective.

If any of the securities being registered on this Form are to be offered on
a delayed or continuous basis pursuant to Rule 415 under the Securities Act of
1933, check the following box: [X]

If this Form is filed to register additional securities for any offering
pursuant to Rule 462(b) under the Securities Act, please check the following box
and list the Securities Act registration statement number of the earlier
effective registration statement for the same offering. [ ]

If this Form is a post-effective amendment filed pursuant to Rule 462(c)
under the Securities Act, check the following box and list the Securities Act
registration number of the earlier effective registration statement for the same
offering. [ ]

If delivery of the prospectus is expected to be made pursuant to Rule 434,
please check the following box. [ ]

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

THE REGISTRANT HEREBY AMENDS THIS REGISTRATION STATEMENT ON SUCH DATE OR
DATES AS MAY BE NECESSARY TO DELAY ITS EFFECTIVE DATE UNTIL THE REGISTRANT SHALL
FILE A FURTHER AMENDMENT WHICH SPECIFICALLY STATES THAT THIS REGISTRATION
STATEMENT SHALL THEREAFTER BECOME EFFECTIVE IN ACCORDANCE WITH SECTION 8(A) OF
THE SECURITIES ACT OF 1933 OR UNTIL THE REGISTRATION STATEMENT SHALL BECOME
EFFECTIVE ON SUCH DATE AS THE COMMISSION, ACTING PURSUANT TO SAID SECTION 8(A),
MAY DETERMINE.

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<PAGE> 2

INFORMATION CONTAINED HEREIN IS SUBJECT TO COMPLETION OR AMENDMENT. A
REGISTRATION STATEMENT RELATING TO THESE SECURITIES HAS BEEN FILED WITH THE
SECURITIES AND EXCHANGE COMMISSION. THESE SECURITIES MAY NOT BE SOLD NOR MAY
OFFERS TO BUY BE ACCEPTED PRIOR TO THE TIME THE REGISTRATION STATEMENT BECOMES
EFFECTIVE. THIS PROSPECTUS SHALL NOT CONSTITUTE AN OFFER TO SELL OR THE
SOLICITATION OF AN OFFER TO BUY NOR SHALL THERE BE ANY SALE OF THESE SECURITIES
IN ANY STATE IN WHICH SUCH OFFER, SOLICITATION OR SALE WOULD BE UNLAWFUL PRIOR
TO REGISTRATION OR QUALIFICATION UNDER THE SECURITIES LAWS OF ANY SUCH STATE.

SUBJECT TO COMPLETION, DATED SEPTEMBER 21, 1998

PROSPECTUS

PARK 'N VIEW, INC.
75,000 WARRANTS TO PURCHASE COMMON STOCK
COMMON STOCK ISSUABLE UPON EXERCISE OF WARRANTS
---------------------

This Prospectus relates to (i) the offering for resale from time to time by
certain selling security holders named herein or in supplements hereto (the
"Selling Security Holders") of an aggregate of 75,000 warrants (the "Warrants")
to purchase an aggregate 505,375 shares (as such number may be adjusted from
time to time in accordance with the terms of the Warrants, the "Warrant Shares")
of common stock, par value $.001 per share ("Common Stock"), of Park 'N View,
Inc. ("the Company"), (ii) the offering for resale from time to time of the
Warrant Shares by the initial investors in the units (the "Units"), consisting
of the Warrants and $75,000,000 aggregate principal amount of 13% Senior Notes
due 2008 (the "Notes") of the Company and (iii) the offer and sale by the
Company of the Warrant Shares to transferees of such initial investors upon
exercise of the Warrants by such transferees.

The Warrant Shares being offered by the Company and the Selling Security
Holders are issuable upon the exercise of the Warrants, which were sold in
connection with the offering (the "Unit Offering") of the Units consisting of
$75,000,000 aggregate principal amount of 13% Senior Notes due 2008 (the
"Notes") of the Company and 75,000 Warrants. Each Unit consisted of $1,000
principal amount of Notes and one Warrant. The Units were issued and sold on May
27, 1998 to Donaldson, Lufkin & Jenrette Securities Corporation (the "Initial
Purchaser") in a transaction exempt from the registration requirements of the
Securities Act of 1933, as amended (the "Securities Act"), to qualified
institutional buyers in reliance on Rule 144A ("Rule 144A") under the Securities
Act.

The Warrants will become exercisable on , 1998 (the "Separation
Date"). Unless exercised, the Warrants will automatically expire on May 15,
2008. The Company will receive the proceeds of any exercise of the Warrants.
Each Warrant, when exercised, will entitle the holder to receive 6.73833 shares
of Common Stock at an exercise price of $.01 per share. The number of shares of
Common Stock purchasable upon the exercise of the Warrants and payment of the
exercise price is subject to adjustment upon the occurrence of certain events.
The exercise of the Warrants will be subject to compliance with applicable
federal and state securities laws. See "Description of Warrants."

The Selling Security Holders will receive all of the proceeds from the sale
of the Warrants. The Selling Security Holders, directly or through agents,
dealers or underwriters to be designated from time to time, may sell the
Warrants and the Warrant Shares from time to time in the over-the-counter
market, on a securities exchange on which the Warrants or the Common Stock are
then listed, in negotiated transactions or otherwise, at prices and on terms to
be determined at the time of sale. At the time a particular offer of the
Warrants or the Warrant Shares is made, if required, the number of Warrants or
Warrant Shares being offered and the terms of the offering, including the name
or names of any agents, dealers or underwriters, the purchase price paid by any
underwriter, any discounts or commissions and the proposed public offering price
will be set forth in one or more supplements to this Prospectus. The aggregate
proceeds to the Selling Security Holders from the sale of the Warrants or
Warrant Shares will be the purchase price of the securities
(continued on next page)
---------------------
SEE "RISK FACTORS" BEGINNING ON PAGE 7 FOR A DESCRIPTION OF CERTAIN RISKS
TO BE CONSIDERED IN CONNECTION WITH AN INVESTMENT IN THE SECURITIES.
---------------------
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS THE SECURITIES
AND EXCHANGE COMMISSION PASSED UPON THE ACCURACY OR ADEQUACY OF THIS PROSPECTUS.
ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.
---------------------
THE DATE OF THIS PROSPECTUS IS , 1998
<PAGE> 3

(cover page continued)

sold less the aggregate agents' commissions and underwriters' discounts, if any,
and other expenses of issuance and distribution not borne by the Company. The
Selling Security Holders and any broker-dealers, agents or underwriters that
participate with the Selling Security Holders in the distribution of any
Warrants or Warrant Shares may be deemed to be "underwriters" within the meaning
of the Securities Act of 1933, as amended (the "Securities Act"), and any
commission received by them and any profit on the resale of the securities
purchased by them may be deemed to be underwriting commissions or discounts
under the Securities Act. See "Selling Security Holders" and "Plan of
Distribution."

All costs (other than commission expenses and brokerage fees, if any)
incurred in connection with the registration and distribution of the Warrant
Shares and the Warrants by the Selling Security Holders are being borne by the
Company. Commission expenses and brokerage fees in respect of the Warrants and
the Warrant Shares are payable by the Selling Security Holders.

The Company is filing the Registration Statement of which this Prospectus
forms a part to fulfill in part its obligations under the Warrant Agreement,
dated May 27, 1998 (the "Warrant Agreement") between the Company and State
Street Bank and Trust Company, as warrant agent (the "Warrant Agent"), and the
Warrant Registration Rights Agreement, dated as of May 27, 1998, by and between
the Company and the Initial Purchaser (the "Warrant Registration Rights
Agreement").

The Warrant Shares and the Warrants are referred to collectively herein as
the "Securities." There is no active market for the Securities, and there can be
no assurance that an active trading market will develop. Prospective investors
in the Securities should be aware that they may be required to bear the
financial risks of such investment for an indefinite period of time.

ii
<PAGE> 4

AVAILABLE INFORMATION

The Company has filed with the Securities and Exchange Commission (the
"Commission") a Registration Statement on Form S-1 (the "Registration
Statement") under the Securities Act with respect to the Securities being
offered hereby. This Prospectus does not contain all the information set forth
in the Registration Statement and the exhibits thereto, to which reference is
hereby made. The Registration Statement and the exhibits thereto may be
inspected and copied at the public reference facilities maintained by the
Commission at Room 1024, Judiciary Plaza, 450 Fifth Street, N.W., Washington,
D.C. 20549 and will also be available for inspection and copying at the regional
offices of the Commission located at 7 World Trade Center, New York, New York
10048 and at Northwestern Atrium Center, 500 West Madison Street (Suite 1400),
Chicago, Illinois 60661. Copies of such material may also be obtained from the
Public Reference Section of the Commission at 450 Fifth Street, N.W.,
Washington, D.C. 20549 at prescribed rates. The Commission also maintains a web
site that contains reports, proxy statements and other information regarding
registrants that file such information electronically with the Commission. The
address of the Commission's web site is http://www.sec.gov.

As a result of the filing of the Registration Statement with the
Commission, the Company will become subject to the informational requirements of
the Securities Exchange Act of 1934, as amended (the "Exchange Act"), and in
accordance therewith will be required to file periodic reports and other
information with the SEC. Pursuant to the Warrant Agreement, as long as any of
the Warrants are outstanding and to the extent the Company is required to send
such documents to the holders of its outstanding Common Stock, whether or not
required by the rules and regulations of the Commission, the Company has agreed
to provide the registered holders of Warrants (and the beneficial Holders upon
request) with copies of quarterly and annual financial information that would be
contained in filings with the Commission on Forms 10-Q and 10-K and, with
respect to annual information, a report thereon by the Company's independent
certified public accountants, and all current reports on Form 8-K.

DISCLOSURE REGARDING FORWARD-LOOKING STATEMENTS

This Prospectus contains certain forward-looking statements under the
captions "Prospectus Summary," "Risk Factors," "Use of Proceeds," "Management's
Discussion and Analysis of Financial Condition and Results of Operations,"
"Business" and elsewhere, including statements regarding, among other items, the
Company's anticipated strategies, installation of the integrated
telecommunications and entertainment network originated and operated by the
Company (the "PNV Network" or "Network") at a significant number of additional
sites, expansion of the functionality and capacity of the PNV Network,
additional telecommunications and other services to be offered through the PNV
Network, cost savings, expenditures and cash requirements. Such forward-looking
statements involve known and unknown risks, uncertainties and other important
factors that could cause the actual results, performance or achievements of the
Company to differ materially from any future results, performance or
achievements expressed or implied by such forward-looking statements. Such
risks, uncertainties and other factors include, among others: general economic
and business conditions and industry trends; uncertainties inherent in proposed
business strategies and development plans; future financial performance,
including availability, terms and deployment of capital; inability to increase
subscription sales or realize expected cost savings; market demand for the
Company's current and planned telecommunications and entertainment services and
products; technological developments; competitive developments in the
telecommunications, cable and long-haul trucking industry; the ability of
vendors to deliver required equipment; availability of qualified personnel;
changes in, or the failure or inability to comply with, government regulation,
including, without limitation, regulations of the Federal Communications
Commission, and adverse outcomes from regulatory proceedings; changes in the
nature of key contractual relationships with truckstops and/or fleet trucking
companies; market acceptance of the pricing of the Company's services and
products; and other factors referenced in this Prospectus. See "Risk Factors."
These forward-looking statements speak only as of the date of this Prospectus.
The Company expressly disclaims any obligation or undertaking to disseminate any
updates or revisions to any forward-looking statement contained herein to
reflect any change in the Company's expectations with regard thereto or any
change in events, conditions or circumstances on which any such statement is
based.

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

Certain market data used throughout this Prospectus were obtained from
industry and government sources. The Company has not independently verified this
market data.

iii
<PAGE> 5

PROSPECTUS SUMMARY

The following summary is qualified in its entirety by the more detailed
information and financial statements, including the notes thereto, appearing
elsewhere in this Prospectus. Capitalized terms used and not otherwise defined
in this summary have the meanings given to them elsewhere in this Prospectus. As
used in this Prospectus unless otherwise indicated, references to the Company's
fiscal year means the fiscal year ended June 30.

THE COMPANY

The Company originated and operates the PNV Network, the only currently
integrated telecommunications and entertainment network currently capable of
providing voice, data and cable television services to long-haul truck drivers
in the convenience and privacy of their trucks while parked at truckstops. The
Company markets and sells subscriptions to its Network to fleet trucking
companies and individual long-haul truck drivers. Based on independent market
research by Fletcher Spaght, Inc., which was commissioned by the Company to
conduct the research, and industry data, the Company believes that there are
between 800,000 and 1,000,000 long-haul truck drivers in the United States.
During June, 1998, the Company had over 25,000 active subscribers, an increase
of over 166% from the approximately 9,400 subscribers it had in July 1997. The
Company was formed in September 1995 and, as of June 30, 1998, had installed the
PNV Network in 118 truckstops located in 38 states across the United States.

The Company believes that both long-haul drivers and fleet trucking
companies have a need for a more comprehensive, cost-effective and easily
accessible voice and data communications and entertainment solution than
currently available alternatives. The Company believes that this market need
combined with the absence of an effective current solution provides the Company
with the opportunity to become the leading provider of integrated
telecommunications and entertainment services to the long-haul trucking
industry. The Company plans to realize this opportunity by (i) increasing the
number of locations served by its Network to a "critical mass" of truckstops
(which the Company believes to be between 200 and 250 strategically located
truckstops), and then to continue the build-out of the Network to approximately
650 sites in total, and (ii) significantly enhancing the functionality and
capacity of its Network to create a broadband, cost competitive private
telecommunications network for the long-haul trucking industry.

The telecommunications services currently provided include: (i) local and
long distance calling, in-coming calls, voice mail services and driver location;
(ii) data connectivity; (iii) access to the Internet; and (iv) other
telecommunications services, including wake up calls and the ability to offer
call waiting and call conferencing. The cable television service offers 18 cable
viewing channels, including premium and local programming, a Pay-Per-View
channel and a dedicated advertising channel.

While on the road, drivers use full service truckstops for fueling, eating,
showering, parking for rest periods (which are required by federal law),
overnight stays and for layovers between hauls. These truckstops are the primary
location at which drivers conduct their business while on the road. Currently,
voice, data communication, Internet connectivity and entertainment options for
the individual long-haul truck drivers and for the fleet trucking companies
trying to communicate with their drivers at these truckstops are limited,
relatively expensive and inaccessible.

1
<PAGE> 6

Centers, Inc., Pilot Corporation, and Professional Transportation Partners, LLC,
have granted the Company the exclusive right to provide telecommunications and
entertainment services to drivers in their cabs at their truckstops. Of the
approximately 751 full-service truckstops under contract as of June 30, 1998,
approximately 413 are covered by contracts directly with the truckstop owner and
approximately 338 are covered by contracts with associations which require the
Company to enter into a contract directly with the truckstop owner to install
the PNV Network. The Company also believes that these approximately 751
full-service truckstops are among the most heavily trafficked and are located
along the busiest truck routes in the United States. The Company believes that
the truckstop owners are highly incentivized to support the success of the
Company as: (i) the contracts contain provisions for revenue and profit sharing
with the Company; (ii) the PNV Network is a means for competitive
differentiation; and (iii) the PNV Network is an amenity that many long-haul
truck drivers have been requesting.

The Company markets to fleet trucking companies through a direct sales
force and plans to focus a significant portion of its marketing efforts on large
and medium size fleet trucking companies. The Company recently signed contracts
with five fleet trucking companies that have purchased monthly subscriptions for
an aggregate of approximately 2,329 drivers for periods ranging from one to
three years, subject to certain earlier termination rights.

Since its formation in September 1995, the Company has received
approximately $112.4 million in financing through the issuance of three classes
of preferred stock, common stock and certain debt, in addition to the net
proceeds of the sale by the Company of the Units on May 27, 1998 to the Initial
Purchaser pursuant to a purchase agreement dated May 20, 1998 (the "Purchase
Agreement") (such sale, the "Unit Offering"). The Company believes, based on its
current estimates, that the net proceeds of the Unit Offering, together with
existing cash and cash generated by operations, will be sufficient to finance
the continued installation of the PNV Network and the expansion of services
offered through the PNV Network through the first half of 2000. The actual
amount and timing of the Company's future capital requirements may differ
materially from the Company's estimates as a result of, among other things, the
demand for the Company's telecommunications and cable television services and
regulatory, technological and competitive developments in the
telecommunications, cable and long-haul trucking industries. The Company also
expects that it will require additional financing (or require financing sooner
than anticipated) if the Company's development plans or projections change or
prove to be inaccurate or the Company accelerates or delays the expansion of
either the installation of the PNV Network or the services offered through the
PNV Network. Sources of additional financing may include commercial bank
borrowings, equipment leasing or private or public sale of equity or debt
securities. There can be no assurance that such financing will be available on
terms acceptable to the Company or at all. See "Risk Factors" and "Management's
Discussion and Analysis of Financial Condition and Results of
Operations -- Liquidity and Capital Resources."

The Company has experienced a net loss and negative cash flow from
operations since it was incorporated and, as of June 30, 1998, had a common
stockholders' deficit of $20.3 million and total long-term debt of $70.6
million. The future success of the Company depends upon, among other things, its
ability to (i) satisfy its future capital requirements on terms satisfactory to
the Company, (ii) significantly increase its revenues which, in turn, depends
materially upon its ability to increase the number of subscribers to the PNV
Network, (iii) install the PNV Network at a significant number of additional
truckstops and add T-1 lines and certain additional equipment at all truckstops
at which the PNV Network is available, all on a timely and cost-effective basis,
and (iv) generate revenues from planned future services and recognize
cost-savings from planned enhancements to the PNV Network. See "Risk Factors."

The Company was incorporated in Delaware in September 1995. The Company's
principal executive offices are located at 11711 NW 39th Street, Coral Springs,
Florida 33065 and its telephone number is (954) 745-7800.

2
<PAGE> 7

RISK FACTORS

Prospective investors should carefully consider all of the information set
forth in this Prospectus and, in particular, should evaluate the specific risk
factors set forth under the caption "Risk Factors," beginning on page 7, for a
discussion of certain risks involved with an investment in the New Notes
including, without limitation, those risks associated with the Company's (i)
limited history of operations, (ii) history of losses and negative cash flow,
(iii) future significant capital requirements, (iv) ability to significantly
increase revenues and (v) substantial leverage and ability to service its
indebtedness.

3
<PAGE> 8

THE OFFERING

Securities Subject to the
Offering................. 75,000 Warrants to purchase initially up to 505,375
shares of Common Stock. Shares of Common Stock
initially issuable upon exercise of the Warrants
plus such indeterminate number of shares of Common
Stock as may be issued pursuant to the
anti-dilution provisions of the Warrants.

Total Number of Warrants... 75,000 Warrants, which when exercised would entitle
the holders thereof to acquire an aggregate of
505,375 Warrant Shares, representing approximately
5% of the Common Stock on a fully diluted basis as
of the consummation of the Unit Offering. See
"Description of Warrants" and "Description of the
Company Capital Stock." The Warrants were issued
pursuant to the Warrant Agreement.

Exercise................... Each Warrant will entitle the holder thereof to
purchase 6.73833 Warrant Shares at an exercise
price of $.01 per share, subject to adjustment
under certain circumstances. The number of shares
of Common Stock for which a Warrant is exercisable
is subject to adjustment upon the occurrence of
certain events as provided in the Warrant
Agreement. See "Description of Warrants."

Duration................... The Warrants will be exercisable at any time on or
after the Separation Date and prior to 5:00 p.m.,
New York City time, on May 15, 2008. The exercise
of the Warrants will be subject to compliance with
applicable federal and state securities laws. See
"Description of Warrants" and "Risk
Factors -- Requirements for Exercising Warrants."

Warrant Agent.............. State Street Bank and Trust Company.

4
<PAGE> 9

SUMMARY FINANCIAL DATA

The summary financial data for the Predecessor for the period from January
1, 1995 to November 2, 1995, and for the Successor for the period from September
18, 1995 (Successor's date of incorporation) to June 30, 1996 and the years
ended June 30, 1997 and 1998 set forth below are derived from the audited
financial statements of the Predecessor and the Successor for such periods
included elsewhere in this Prospectus. The summary financial data set forth
below for the Predecessor for the year ended December 31, 1994 are derived from
audited financial information. These historical results are not necessarily
indicative of the results that may be expected in the future. The summary
financial data are qualified by reference to and should be read in conjunction
with "Management's Discussion and Analysis of Financial Condition and Results of
Operations," the financial statements and notes thereto and other financial data
included elsewhere in this Prospectus.

<TABLE>
<CAPTION>
PREDECESSOR(1) SUCCESSOR(1)
-------------------------- --------------------------------------------
PERIOD PERIOD FROM
FROM SEPTEMBER 18,
JANUARY 1, 1995 (DATE OF
YEAR ENDED 1995 TO INCORPORATION) YEAR ENDED YEAR ENDED
DECEMBER 31, NOVEMBER 2, TO JUNE 30, JUNE 30, JUNE 30,
1994 1995 1996 1997 1998
------------ ----------- -------------- ------------ ------------
<S> <C> <C> <C> <C> <C>
STATEMENT OF OPERATIONS DATA:
Revenues......................... $ 149,755 $ 888,397 $ 3,503,776
Cost of revenues(2).............. 436,829 2,077,689 6,598,993
Selling, general and
administrative expenses........ $ 287,782 $ 475,891 1,576,209 5,026,580 10,413,622
--------- --------- ----------- ------------ ------------
Loss from operations............. (287,782) (475,891) (1,863,283) (6,215,872) (13,508,839)
Interest (expense) income and
other, net..................... (97,954) 170,852 (224,908)
--------- --------- ----------- ------------ ------------
Net loss......................... $(287,782) $(475,891) $(1,961,237) $ (6,045,020) $(13,733,747)
========= ========= =========== ============ ============
Net loss attributable to common
stockholders................... $(1,982,607) $ (6,962,402) $(16,526,284)
OTHER OPERATING DATA:
EBITDA(3)........................ $(287,782) $(475,891) $(1,778,942) $ (5,572,556) $(11,602,107)
Capital expenditures............. 109,587 909 1,650,177 6,443,899 12,596,875
Amount that earnings were
insufficient to cover fixed
charges(4)..................... (1,961,237) (6,045,020) (13,733,747)
Amount that earnings were
insufficient to cover fixed
charges and preferred stock
dividend requirements(4)....... (1,982,607) (6,962,402) (16,526,284)
Net cash flows used in operating
activities..................... (254,311) (389,809) (1,452,706) (3,400,128) (9,375,071)
Net cash flows used in investing
activities..................... (109,587) (909) (1,650,177) (6,443,899) (63,899,791)
Net cash flows provided by
financing activities........... 369,449 380,070 3,468,614 14,197,690 88,368,124
</TABLE>

<TABLE>
<CAPTION>
SUCCESSOR(1)
PREDECESSOR(1) --------------------------------------------
-------------- JUNE 30,
DECEMBER 31, --------------------------------------------
1994 1996 1997 1998
-------------- -------------- ------------ ------------
<S> <C> <C> <C> <C>
BALANCE SHEET DATA:
Cash and cash equivalents................... $ 19,856 $ 365,731 $ 4,717,394 $ 19,810,656
Working capital............................. 6,521 (81,610) 2,813,544 66,652,141
Total assets................................ 174,711 2,898,125 12,938,783 94,578,127
Total long-term debt........................ 216,667 3,387,934 425,430 70,604,740
Total redeemable preferred stock............ 721,370 19,131,466 39,133,924
Partnership deficiency/common stockholders'
deficit................................... (55,292) (1,969,525) (8,931,927) (20,269,763)
</TABLE>

5
<PAGE> 10

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

(1) Park 'N View, Ltd. transferred certain of its assets, contractual rights and
liabilities to Park 'N View, Inc. in exchange for 2,318,182 shares of common
stock issued to the former partners of Park 'N View, Ltd. The net
liabilities transferred were recorded by Park 'N View, Inc. at Park 'N View,
Ltd.'s historical carrying amount of $84,446. The financial information
identified herein as for the Predecessor is for Park 'N View, Ltd. as of and
for the year ended December 31, 1994 and the period from January 1, 1995 to
November 2, 1995, the date the net liabilities were transferred to Park 'N
View, Inc. The financial information identified herein as for the Successor
is for Park 'N View, Inc. as of June 30, 1996, 1997 and 1998 and for the
period from September 18, 1995 (date of incorporation) to June 30, 1996 and
for the years ended June 30, 1997 and 1998.

(2) Includes service depreciation of $84,000, $643,000 and $1,907,000 for the
period from September 18, 1995 (date of incorporation) to June 30, 1996 and
the years ended June 30, 1997 and 1998, respectively. Service depreciation
consists of amortization of capitalized costs of the PNV Network.

(3) EBITDA is earnings (loss) from operations before interest, taxes, and
service depreciation. EBITDA is a measure of a company's performance
commonly used in the telecommunications industry, but should not be
construed as an alternative to net income (loss) determined in accordance
with generally accepted accounting principles ("GAAP") as an indicator of
operating performance or as an alternative to cash from operating activities
determined in accordance with GAAP as a measure of liquidity. EBITDA is an
earnings calculation that is used by certain investors and in particular
debt holders as one measure of an ability to service debt, pay taxes and
provide for working capital and capital expenditure requirements. However,
it does not reflect cash generated because it does not include changes in
working capital or capital expenditures. It also is not an accounting
measure that is in conformity with GAAP because it does not include
interest, taxes, depreciation and amortization which are significant
components in understanding and assessing the Company's financial
performance. The trend in EBITDA must be evaluated by taking into
consideration the trend in interest, taxes, depreciation, and amortization
expenses. If these expenses are considered, a trend in EBITDA may reflect
the Company's utilization of financial debt and fixed asset resources. Also,
management believes that in a capital intensive business that is highly
leveraged, the earnings coverage for interest is important to debt holders
and investors in the Company as an indicator of whether there may be a
potential default to the debt holders because of the inability to cover
interest and principal. The Company's computation of EBITDA may not be
comparable to similarly titled measures reported by other companies.

(4) In calculating the ratio of earnings to fixed charges and the ratio of
earnings to fixed charges and preferred stock dividend requirements,
"earnings" consist of net loss and fixed charges. Fixed charges consist of
interest expense, including such portion of rental expense that is
attributable to interest.

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<PAGE> 11

RISK FACTORS

Prospective investors should carefully consider the following factors in
evaluating the Company and its business in addition to other information
contained in this Prospectus prior to purchasing the Securities.

LIMITED HISTORY OF OPERATIONS

The Company was incorporated in September 1995. Accordingly, prospective
investors have limited financial information about the Company upon which to
base an evaluation of the Company's performance. Given the Company's limited
operating history, there is no assurance that it will be able to generate
sufficient cash flow to service its debt obligations (including the Notes) or to
achieve its objectives.

HISTORY OF LOSSES, NEGATIVE CASH FLOW AND NEGATIVE GROSS MARGIN

The Company has experienced a net loss and negative cash flow from
operations in each quarter since it was incorporated. As of June 30, 1998, the
Company had a common stockholders' deficit of $20.3 million. The Company expects
to incur a significant net loss and negative cash flow from operations in the
fiscal year ending June 30, 1999 and for the next several years. There can be no
assurance that the Company will ever be profitable. From September 1995 to date,
the Company's cost of revenues has been substantially higher than its revenues,
leading to a negative gross margin. There can be no assurance that the Company
will generate significant revenue in the future, and even if it does so, that
the Company's revenues will ever exceed its cost of revenues. See "Management's
Discussion and Analysis of Financial Condition and Results of Operations."

FUTURE CAPITAL REQUIREMENTS; UNCERTAINTY OF ADDITIONAL FUNDING

The Company expects that it will have significant capital requirements in
the future to fund the continued expansion of its business and for working
capital purposes, and there can be no assurance that such capital requirements
will be available on terms satisfactory to the Company, if at all. The Company's
capital requirements will depend on numerous factors, including the growth of
the Company's revenues, if any, and the rate of such growth. The Company expects
that the net proceeds of the Unit Offering, together with existing cash and
anticipated cash generated from operations, will be sufficient to fund its
planned expansion and operations at least through the first half of 2000.
Thereafter, if the Company's cash flow from operations is not sufficient to
provide funds for working capital and capital expenditures and if equity or debt
or other financing is not available, the Company expects that it may experience
insufficient liquidity which could have a material adverse effect on the
Company's financial condition and results of operations. There can be no
assurance that additional financing will be available when needed, if at all,
or, if available, on terms acceptable to the Company. If adequate funds are not
available on acceptable terms, the Company will be required to delay or limit
any further expansion of its business. Any inability to fund its future capital
requirements would have a material adverse effect on the Company's business,
financial condition and operating results. See "Management's Discussion and
Analysis of Financial Condition and Results of Operations -- Liquidity and
Capital Resources."

ABILITY TO SUSTAIN AND INCREASE SUBSCRIPTION SALES; RETENTION

The future success of the Company depends upon its ability to significantly
increase its revenues which, in turn, depends materially upon its ability to
increase the number of subscribers to the PNV Network. During June 1998, the
Company had approximately 25,000 active subscribers of whom approximately 17,100
had subscribed on a monthly basis (including subscription sales at the Company's
vending machines at truckstops, pursuant to a monthly subscription program
referred to as the "Power Plan Program" and pursuant to the Company's contracts
with fleet trucking companies) and 8,100 were daily subscribers. To date, the
Company's average revenue per subscriber has been lower than expected which the
Company believes is due primarily to a larger number of daily subscribers as
compared to monthly subscribers. Market research and the Company's experience
indicate that, in order to provide a benefit to truck drivers sufficient to
justify the monthly subscription fee, the PNV Network must be available
nationally at a minimum threshold number of sites so that truck drivers can rely
on access to the PNV Network as they travel their routes. The Company believes

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<PAGE> 12

that this number of sites ranges between 200 and 250, depending on site
location, size and other factors. As of June 30, 1998, the PNV Network was
installed and operating at 118 truckstops.

Even if truck drivers initially subscribe to the PNV Network, there can be
no assurance that they will renew their subscriptions. Of those subscribers who
purchased a subscription in April 1998, Company data indicates that
approximately 70% renewed their subscriptions at least once between such
subscription and July 1998. In October 1997, the Company implemented the Power
Plan Program, which was designed to increase monthly subscription renewals. See
"Business -- Marketing." Pursuant to this program, a subscriber's monthly
subscription is automatically renewed and the monthly fee is automatically
drafted from or charged to the subscriber's checking account or credit card
until the subscriber cancels the subscription. As of June 30, 1998, the Company
had 9,500 monthly subscribers pursuant to the Power Plan Program, however, there
can be no assurance that the number of such subscribers will continue to grow.
There are many factors that could cause a subscriber not to renew a
subscription, including dissatisfaction with the PNV Network and the services
offered or with the number and location of the truckstops at which the PNV
Network is available.

The Company's ability to increase subscriptions to the PNV Network depends
significantly upon its ability to increase sales to fleets. See
"Business -- Marketing." As of June 30, 1998, the Company had entered into
contracts with five fleet trucking companies for a minimum of 2,329
subscriptions for terms ranging from one to three years, subject to certain
earlier termination rights by the fleet trucking companies. There can be no
assurance, however, that the fleets having earlier termination rights will not
terminate their contracts prior to the expiration of their stated terms,
existing contracts will be renewed or the Company will be able to increase its
subscription sales to fleets.

The ability of the Company to attract and retain subscribers will also
depend in part on the ability of such subscribers to access a stall at a
truckstop served by the PNV Network and, with regard to the use of the Company's
telephone services, to access one of the local telephone lines maintained by the
Company in connection with the telephone service offered. Subscribers may on
occasion be unable to utilize the PNV Network due to a lack of open stalls at
some of the busier truckstops. In addition, users of the PNV Network's telephone
service at a particular truckstop cannot exceed the number of local lines
available. The Company presently maintains an average of 12 local telephone
lines at each truckstop served by the PNV Network. In connection with the
proposed enhancements to the PNV Network to increase its capacity and
functionality to allow the Company to offer additional telecommunications
services, the Company intends, among other things, to install and maintain a T-1
line, and to reduce the number of local lines, at each truckstop. See
"Business -- Network and Technology." Although this installation will increase
the number of users that may access the PNV Network's telecommunications
services simultaneously, this number will still be limited. In addition, truck
drivers may find that the truckstops served by the PNV Network are not
conveniently located. If truck drivers find that the truckstops served by the
PNV Network are not conveniently located, it is unlikely that they will purchase
or renew subscriptions. The Company's inability to attract and retain
subscribers and to significantly increase revenues from sales of subscriptions,
including subscription sales to fleets, for any reason, would have a material
adverse effect on the Company's business, financial condition and results of
operations, including its ability to make payments on the Notes.

SUBSTANTIAL LEVERAGE; POSSIBLE INABILITY TO SERVICE INDEBTEDNESS

As a result of the Unit Offering, the Company is highly leveraged. At June
30, 1998, the Company had total long-term debt of $70.6 million and a common
stockholders' deficit of $20.3 million. The Company's earnings were insufficient
to cover its fixed charges and preferred stock dividend requirements by
approximately $7.0 and $16.5 million for fiscal 1997 and 1998, respectively. See
"Capitalization" and "Selected Financial Data." The Company will be permitted to
incur additional indebtedness in the future under the indenture relating to the
Notes (the "Indenture"), subject to the restrictions set forth therein. See "--
Restrictive Covenants" and "Description of the Notes -- Certain
Covenants -- Incurrence of Indebtedness and Issuance of Disqualified Stock."

The Company's ability to make scheduled payments of principal of, or to pay
interest or liquidated damages, if any, on its indebtedness (including the
Notes) will depend on the Company's future performance

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<PAGE> 13

which, to a certain extent is subject to general economic, financial,
competitive, legislative, regulatory and other factors that are beyond its
control. Based upon the current level of operations and anticipated revenue
growth, management believes that the net proceeds of the Offering, together with
existing cash and anticipated cash generated by operations, will be adequate to
meet the Company's future liquidity needs at least through the first half of
2000. There can be no assurance that the Company's business will generate
sufficient cash flow from operations and that anticipated revenue growth will be
realized in an amount sufficient to enable the Company to service its
indebtedness, including the Notes, or to continue the installation of the PNV
Network and the payment of the costs associated with the provision of
telecommunications and entertainment services and its operations. See
"Management's Discussion and Analysis of Financial Condition and Results of
Operations -- Liquidity and Capital Resources."

The degree to which the Company is leveraged could have important
consequences to the holders of the Notes and the Company's future prospects,
including the following: (i) limiting the ability of the Company to obtain any
necessary financing in the future for working capital, capital expenditures,
debt service requirements or other purposes; (ii) the Company's vulnerability to
the effects of general economic downturns or to delays or increases in the costs
of installing the PNV Network or planned subsequent improvements thereto or
providing planned telecommunications services in addition to those currently
provided may be increased; (iii) limiting the flexibility of the Company in
planning for, or reacting to, changes in its business; (iv) leveraging the
Company more highly than some of its potential competitors, which may place it
at a competitive disadvantage; (v) increasing its vulnerability in the event of
a downturn in its business or the economy generally; and (vi) requiring that a
substantial portion of the Company's cash flow from operations be dedicated to
the payment of principal and interest on the Notes and not be available for
other purposes.

There can be no assurance that the Company will be able to meet its
obligations under the Notes. The Company expects to generate significant
negative cash flow over the next several years. If the Company does not
ultimately generate sufficient cash flow to meet its debt service and capital
requirements, the Company may need to examine alternative strategies that may
include actions such as reducing or delaying capital expenditures, restructuring
or refinancing its indebtedness, the sale of assets or seeking additional
equity, debt or other financing. There can be no assurance that any of these
strategies could be effected on satisfactory terms, if at all. In addition,
there can be no assurance that the Company will be able to effect any such
refinancing on commercially reasonable terms or at all.

EXPANSION OF PNV NETWORK INSTALLATION

The Company's ability to achieve its objectives will depend in large part
on the timely and cost-effective installation of the PNV Network at a
significant number of additional truckstops and the addition of T-1 lines and
certain additional equipment at all the truckstops at which the PNV Network is
available. The success of the Company in installing the PNV Network will depend
on, among other things, timely performance by the third parties of their
contractual obligations. Following the completion of the Unit Offering, the
Company intends to increase its truckstop installation rate to approximately 15
to 20 per month by the first quarter of 1999. During August 1998, the Company
installed the PNV Network at approximately 14 truckstops. There can be no
assurance that the Company will be able to achieve its build-out rate after the
consummation of the Unit Offering as planned and any failure to do so could have
a material adverse effect on the Company's business, financial condition and
results of operations.

The Company is presently utilizing the services of four contractors, three
of which the Company believes operate on a national basis and one of which the
Company believes operates on a regional basis. To date, the installation of the
PNV Network at truckstops by outside contractors has been completed
substantially on the Company's schedule and within its budget, and the
installation services performed by such contractors have been satisfactory to
the Company. Although management believes that there are a number of contractors
that could perform the required installation services or that the Company could
employ sufficient persons to perform such services, there can be no assurance
that it will be able to obtain the services of outside contractors that can
install the PNV Network on a timely basis and at a cost acceptable to the
Company.

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<PAGE> 14

In connection with planned enhancements to the PNV Network, the Company
intends to install T-1 lines, in addition to local telephone lines, at each
truckstop served by the PNV Network. The Company has recently entered into a
contract with AT&T for the lease of T-1 lines. See "Business -- Products and
Services -- Future Products and Services." Any delay in the installation of the
T-1 lines or adverse weather or other complications could significantly delay
the Company's planned increase in the number of truckstops served by the PNV
Network. Such delay or an increase in the cost associated with the installation
of the PNV Network could adversely affect the Company's planned build-out of the
PNV Network which in turn could adversely affect the Company's ability to create
substantial demand for its services and increase subscription sales and, as a
result, the Company's business, financial condition and results of operations,
including its ability to make payments on the Notes.

MINIMUM REQUIREMENTS CONTRACTS

The Company has recently entered into contracts with AT&T for the lease of
T-1 lines and the purchase of long distance and other telephone services. These
contracts require the Company to pay a specified minimum dollar amount of lease
payments and to purchase a specified minimum dollar amount of long distance
telephone services, each of which amounts is subject to certain discounts based
on the T-1 lines leased and the telephone services purchased. See
"Business -- Products and Services -- Future Products and Services." The
Company's ability to achieve its objectives depends in significant part on its
ability to obtain these discounts. Any failure to obtain the available discounts
with regard to its T-1 line lease payments and its long distance telephone
service rates could have a material adverse effect on the Company's business,
financial condition and results of operations.

FUTURE REVENUE STREAMS; COST SAVINGS

The Company's ability to achieve its objectives depends significantly on
its ability to generate revenues from planned future services and recognize
cost-savings from planned enhancements to the PNV Network. See
"Business -- Future Products and Services." The PNV Network as currently
designed does not have the capacity to provide certain of these planned future
services and the capacity of the proposed PNV Network architecture to provide
such services is untested and the market for such services is undetermined. Any
inability of the Company to generate revenue from such planned future services
or realize anticipated cost-savings could have a material adverse effect on the
Company's business, financial condition and results of operations, including its
ability to make payments on the Notes.

POTENTIAL UNAVAILABILITY OF EQUIPMENT

The Company purchases its satellite equipment, head-end equipment,
telephone and cable switching equipment, computer hardware and cable programming
from outside suppliers. The Company has no purchase agreements with any such
supplier other than its cable programming supplier, Echostar Communications
Corporation ("Echostar"). The Company presently purchases its satellite
equipment and computer hardware from a sole supplier and management believes
that limited alternative sources for such items exist. The Company believes that
its relationships with the suppliers of these items are good. However, if the
Company were required to purchase telephone switching alternative equipment from
another source, it would require reprogramming of certain of the Company's
software or if the Company were required to purchase any alternative equipment
from another source, it would require that the Company modify and redesign the
PNV Network in certain respects which, in each case, could result in service
delays and expense to the Company. In addition, the Company purchases the cable
programming offered through the PNV Network from Echostar. Although management
believes that limited alternative sources for cable programming exist, utilizing
an alternative source could require retrofitting certain equipment at each
truckstop site and could result in an interruption in the Company's ability to
offer cable television services through the PNV Network for a limited period of
time. Any failure of the Company to obtain any of the foregoing equipment,
particularly its cable and telephone switching equipment, or cable programming,
could have a material adverse effect on the Company's ability to expand its
business in a timely fashion and, as a result, on its results of operations and
financial condition.

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<PAGE> 15

DEPENDENCE ON CONTRACTUAL RELATIONSHIPS WITH TRUCKSTOPS

All of the Company's current revenues are generated from its operation of
the PNV Network at truckstops. The Company expects that the provision of
telecommunications and entertainment services, including planned future
services, through the PNV Network will continue to be the sole source of the
Company's revenues for the foreseeable future. See "Management's Discussion and
Analysis of Financial Condition and Results of Operations -- Overview" and
"Business -- Network Buildout; Truckstop Relationships and Contracts" for a
discussion of the Company's contractual relationships with truckstop owners and
associations. The Company is dependent on its ability to continue to install the
PNV Network for its future expansion.

The Company has contracted with truckstop chains and independent truckstop
owners located throughout the United States. See "Business -- Network Buildout;
Truckstop Relationships and Contracts." While most independent truckstop owners
who own a single truckstop execute a standard contract, the contracts executed
by truckstop chains that operate multiple truckstops vary significantly. The
contracts generally provide that the truckstop chains and independent truckstop
owners may terminate the contract, and the Company's exclusive rights under the
contract, if the Company fails in any material respect to perform any of its
obligations under the contract and fails to remedy the breach within 30 days
after the Company receives notice of the breach. For example, if the Company
fails to install the PNV Network in accordance with the build-out schedule in
certain of its contracts, truckstop owners owning over one-third of the
Company's proposed truckstop locations may terminate the exclusivity provisions
contained in such contracts. Any failure by the Company to meet its contractual
obligations that results in the termination of contracts, including the loss of
the Company's exclusive rights under such contracts, would have a material
adverse effect on the Company's financial condition and results of operations.

In addition, as of June 30, 1998, the Company had contracts to install the
PNV Network at approximately 338 truckstops through trucking associations whose
members consist of smaller truckstop chains generally having fewer than 10
truckstops. These associations act as purchasing agents for their members. The
Company entered into contracts with these associations as an efficient manner in
which to gain access to and establish a relationship with numerous small to
medium size truckstops. These associations do not have authority to legally bind
their members. Therefore, while each association has granted the Company the
exclusive right to provide cable television and telephone services to its
members, this contractual right is not binding on each member. Prior to
installation of the PNV Network at an association member's truckstop, the
Company enters into a contract with the association member granting the Company
the exclusive right to install the PNV Network at the member's truckstops.
Accordingly, there can be no assurance that the Company's contracts with
truckstop associations will result in the Company installing the PNV Network at
additional truckstop locations. See "Business -- Network Buildout; Truckstop
Relationships and Contracts."

MANAGEMENT OF GROWTH

The Company has expanded its operations significantly over the past 12
months, placing significant demands on its financial, marketing and sales,
administrative and operational personnel and systems. The Company has also
experienced rapid growth in its management and staff, including the addition of
three executive officers, during the past 12 months. As of June 30, 1998, the
number of the Company's full-time employees had increased to 174 from 74 as of
June 30, 1997. In addition, the Company expects to add approximately 100 persons
to its sales force over the next 12 months. The growth in the size and scope of
the Company's business activities have placed, and are expected to continue to
place, a strain on the Company's management and operations. In connection with
its planned expansion of the PNV Network locations and services, management has
been and in the future will be required to recruit, organize, train and manage
additional personnel to perform, among other things (i) the planning and
engineering activity associated with the installation of the PNV Network at each
truckstop, (ii) the assembly at the Company's headquarters of the electronics
and other equipment comprising the PNV Network and the loading of such equipment
for delivery to each site, (iii) the inspection of each site upon completion of
the installation, (iv) the training of the truckstop employees and (v) the
marketing and promotion of the PNV Network at each site. The Company's success
in managing the expansion of its business will depend to a large extent on the
Company's

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<PAGE> 16

ability to hire, train and supervise such additional personnel. There can be no
assurance that the Company will be able to attract, train, supervise and retain
an adequate number of such personnel. The failure of the Company to effectively
manage the growth in its business and to develop the additional personnel,
systems, resources, procedures and controls necessary to support that growth in
a timely manner would have a material adverse effect on the Company's business,
financial condition and results of operations.

COMPETITION

In the voice and data communication and entertainment arenas, the Company
competes with various elements of other providers' offerings based on ease of
access, functionality and cost. These industries are highly competitive, and the
Company expects to face strong competition from existing and potential
competitors. The Company's competitors comprise a broad range of companies
engaged in telecommunications and entertainment, including but not limited to,
public pay telephone operators, cellular telephone companies, long distance
telephone companies, cable operators, direct broadcast satellite companies, as
well as companies developing new technologies. Certain of these competitors and
potential competitors are well established companies and have significantly
greater financial, marketing and programming resources than the Company.

The Company's telecommunication services compete with cellular telephones,
pay telephones and providers of long distance cards and prepaid cards. Cellular
service is widely available and, although it is currently more expensive than
the PNV Network, it is becoming more affordable. The Company believes that
drivers currently use pay telephones located at truckstops for a significant
number of the calls they make and there can be no assurance that the Company
will successfully attract customers who predominately use these pay telephones.
The Company understands that one company, HighwayMaster, resells cellular
telephone service to provide both voice and data communication to the truck cab.
The Company's long distance services compete with providers of long distance
cards and pre-paid cards such as AT&T and MCI and with providers of toll free
(800 and 888) numbers that fleets or even individuals use to call fleet
headquarters or home. Qualcomm's OmniTRACS service, another competitor, is used
primarily for mobile vehicle location and two-way text messaging and it
addresses the trucking fleets' need for real-time mobile text communication.
Based on publicly available data, the OmniTRACS service has an installed base of
approximately 210,000 units in 32 countries worldwide, of which the Company
believes that over 150,000 units are installed in the United States which would
compete with certain of the Company's services. In addition, the Company
believes that there is a company that has begun installing Internet/e-mail
kiosks in truckstops. There can be no assurance that the Company will be able to
effectively compete against these or future telecommunications competitors, many
of which have large customer bases and significantly more resources than the
Company.

With respect to entertainment, the Company's competition currently consists
of entertainment alternatives located outside the truck cab and primarily in the
truckstop. Community television and game rooms inside the truckstop are the most
readily available entertainment alternatives for long-haul truck drivers. The
Company believes that a small number of professional truck drivers have
purchased direct broadcast satellite dishes to receive television programming in
their cab. Cable providers to such users as residential apartment buildings
could seek to compete by offering programming to truckstops. There can be no
assurance that the Company will be able to compete successfully against the
providers of cable and digital satellite programming services, most of which
will have access to greater resources and provide more programming than the PNV
Network. See "Business -- Competition."

SUBSTANTIAL RELIANCE ON KEY PERSONNEL

The success of the Company is dependent to a significant extent on the
personal efforts and abilities of its senior management. The Company has no
employment agreement with any members of its senior management. The Company
believes that the loss of services of any member of its senior management could
have a material adverse effect on the Company. The Company maintains key man
term life insurance on the life of Mr. Williams, the Chief Executive Officer, in
the amount of $1.0 million, payable to the Company. There can be no assurance
that the Company will be able to retain its senior management or that it will be
able to attract or retain other skilled personnel in the future.

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<PAGE> 17

REGULATORY MATTERS

The FCC and relevant state regulatory authorities ("PSC's") have the
authority to regulate interstate and intrastate telephone rates, respectively,
ownership of transmission facilities and the terms and conditions under which
certain of the Company's telephone service offerings are provided. Federal and
state regulations and regulatory trends have had, and in the future are likely
to have, both positive and negative effects on the Company and its ability to
compete. There can be no assurance that changes in current or future federal or
State regulations or future judicial changes would not have a material adverse
effect on the Company's business, financial condition or results of operations.

Interstate telecommunications carriers are subject to a number of other
federal regulatory obligations and reporting requirements, including obligations
to contribute to universal service and other subsidy funds, to permit resale of
their services by other carriers, and to take certain steps to protect
consumers. While the Company does not believe the burdens imposed by federal
regulations will be onerous, failure to comply with applicable regulations could
result in fines or other penalties, including loss of authority to provide
interstate service.

The intrastate operations of the Company may be subject to various state
laws and regulations. Most states require the Company to apply for certification
to provide long distance telecommunications services, operator services, pay
phones or competitive local exchange services, or to register or be found exempt
from regulation, before commencing intrastate services. Most states also require
the Company to file and maintain detailed tariffs listing their rates for
intrastate service. Many states also impose various reporting requirements
and/or require prior approval for transfers of control of certified carriers,
assignment of carrier assets, including customer bases, carrier stock offerings,
incurrence by carriers of significant debt obligations and acquisitions of
telecommunications operations. Other regulatory requirements may mandate that
the Company permit resale of its services by other companies, make payments to
intrastate universal service and similar funds, and take certain steps to
protect consumers. Certificates of authority can generally be conditioned,
modified, canceled, terminated and revoked by state regulatory authorities for
failure to comply with state law and/or rules, regulations and policies of the
state regulatory authorities. Fines and other penalties also may be imposed for
such violations. Any delay by the Company in complying with these state laws and
regulations would limit the Company's ability to provide telecommunications
services to the long-haul trucking industry. In addition, if the Company were
not to be in compliance with relevant state laws and regulations, the
appropriate state regulatory body may force the Company to suspend offering its
telecommunications services in such state. Such an event could have a material
adverse effect on the Company's business, financial condition and results of
operations.

Although the Company has not determined whether its current and anticipated
telephone service offerings are subject to regulation by all state and federal
regulatory authorities, the Company is currently in the process of obtaining
authority, pursuant to regulation, certification, tariffs, notifications, or on
an unregulated basis, to provide intrastate interexchange service in the 48
contiguous states and Hawaii. The interpretation and enforcement of such laws
and regulations in relation to the Company's current and future service offering
may vary, and there can be no assurance that the Company will be in compliance
with all such laws and regulations at any one point in time.

Various state and federal regulatory factors may have an impact on the
Company's ability to service customers. Many of the rights and obligations
created by statute and regulation are subject to ongoing regulatory
implementation proceedings and review by the courts, and are subject to change.
Changes to some regulations could benefit the Company, while other changes could
make it more difficult for the Company to compete.

Cable television companies are subject to extensive governmental
regulation. The Company does not believe that it is subject to such regulations.
However, in the event the Company is required to comply with such regulations,
the expense, potential delay and management distraction potentially resulting
from the compliance process could have a material adverse effect on the
Company's results of operations and financial condition. See
"Business -- Regulatory Matters."

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TRUCKING INDUSTRY; TARGET MARKET

The Company's business is dependent upon the trucking industry in general
and upon long-haul trucking activity in particular. In turn, the trucking
industry is dependent on economic factors, such as the level of domestic
economic activity and interest rates, as well as operating factors such as fuel
prices and fuel taxes over which the Company has no control and which could
contribute to a decline in truck travel. The long-haul trucking business is also
a mature industry that has grown slowly in recent years and has, in the past,
been susceptible to recessionary downturns.

The current target market for the PNV Network is comprised primarily of the
long-haul truck drivers in the United States (including Canadian drivers
crossing the U.S.-Canadian border to deliver and/or pick up loads) that spend
material amounts of time in truckstops. There is no consensus as to the number
of long-haul truck drivers that comprise the Company's target market, and there
can be no assurance that the Company's estimate of the size of its target market
is accurate. Although a number of sources, including government agencies, trade
associations, industry publications and the Company's own independently retained
market research consulting firm have published estimates based on one or more of
the following: freight taxes, diesel fuel usage, number of trucks, number of
truck drivers, commercial drivers licenses or other data relating to the
trucking industry, these estimates vary widely. Accordingly, there can be no
assurance that the Company's estimate of its target market is not materially
inaccurate, which could increase the penetration level that the Company must
achieve in order to successfully implement its business plan.

RAPID TECHNOLOGICAL CHANGES

The telecommunications and cable industries are subject to rapid and
significant changes in technology. While the Company believes that for the
foreseeable future these changes will neither materially affect the continued
use of the Company's technology or the current or planned design, functionality
or capacity of the PNV Network or the telecommunications and cable services
offered nor materially hinder the Company's ability to acquire necessary
technologies, the effect of technological changes on the business of the Company
cannot be predicted. Thus, there can be no assurance that technological
developments will not have a material adverse effect on the Company.

PROPRIETARY RIGHTS

The Company believes that recognition of its products and services is an
important competitive factor in its industry. Accordingly, it promotes (or
intends to promote) the following in connection with its marketing activities
and holds or has filed an application for a United States trademark registration
for the following: "PARK 'N VIEW," "INCAB PNV," "PNV USA," "YOUR CAB. YOUR
CABLE. YOUR CALL.," "PARK 'N VIEW" (with design), "DEN" (with design), and
"WHERE SMART DRIVERS STAY CONNECTED."

The Company also regards the software developed by the Company (the "PNV
Software") as proprietary and attempts to protect it as a trade secret. The
Company holds no patents or copyrights on its software technology. If the
Company decides to seek either a copyright or a patent for the PNV Software,
there can be no assurance that the Company will be able to obtain such a
copyright or a patent. The intellectual property protections employed by the
Company, however, may not afford complete protection and there can be no
assurance that third parties will not independently develop such know-how or
obtain access to its know-how, ideas, concepts and documentation.

IMPACT OF YEAR 2000 ISSUE

14
<PAGE> 19

assessing its non-information technology systems. These types of systems are
more difficult to assess and repair than information technology systems and the
Company may have to replace the non-information technology systems that cannot
be repaired. The Company will begin reviewing its non-information technology
systems in second half of 1999. The Company will utilize both internal and, if
needed, external resources to reprogram or replace and test all of its software
for Year 2000 compliance and the Company expects to complete the project during
the second half of 1999. The Company believes that costs incurred in connection
with any such testing and required reprogramming and replacement will not have a
material adverse effect on the Company's financial condition or results of
operations. The Company has a preliminary estimate of $300,000 as the maximum
cost of evaluating, testing, reprogramming, and modifying software. This
estimate is based on the belief that no major problems will be encountered in
becoming Year 2000 compliant. Based on its preliminary internal review, the
Company believes that the PNV Software is Year 2000 compliant. However, the
Company plans to do more extensive testing of its PNV Software during the next
year which may require the use of independent consultants to assist in the
Company's evaluation to assure a correct assessment of cost and risk. In
addition, the Company relies on third party vendors which must also become Year
2000 compliant. The Company has a significant reliance on outside vendors such
as telephone companies, satellite system providers, electrical providers and the
wide area network supplier. These services are critical in the Company's ability
to generate revenue. The ability of third parties with whom the Company
transacts business to adequately address their 2000 issue is outside of the
Company's control. The Company is planning to create a comprehensive list of all
internal and external software programs to assure that a full review of such
software is completed. However, if any necessary modifications to the PNV
Software are not completed in a timely manner or if the Company's vendors are
not Year 2000 compliant, the Year 2000 problem could have a material adverse
impact on the operations of the Company. See "Management's Discussion and
Analysis of Financial Condition and Results of Operations -- Year 2000."

RESTRICTIVE COVENANTS

The Indenture contains a number of covenants that will limit the discretion
of the Company's management with respect to certain business matters. These
covenants, among other things, restrict the ability of the Company to incur
additional indebtedness, pay dividends and make other distributions, prepay
subordinated indebtedness, make investments and other distributions, enter into
sale and leaseback transactions, create liens, sell assets, and engage in
certain transactions with affiliates. A failure to comply with the covenants and
restrictions contained in the Indenture, or other agreements relating to any
subsequent financing, could result in an event of default under such agreements
which could permit acceleration of the related debt and acceleration of debt
under other debt agreements that may contain cross-acceleration or cross-default
provisions. See "Description of the Notes."

ABSENCE OF PUBLIC MARKET

There is currently no market for the Warrants or the Common Stock of the
Company. The Company does not currently intend to list the Warrants or its
Common Stock on any national securities exchange or to seek the admission
thereof to trading in the Nasdaq National Market. There can be no assurance that
an active trading market for any of the Securities will develop, or if one does
develop, that it will be sustained. Accordingly, no assurance can be made as to
the liquidity of the trading market for the Securities. If any of the Securities
are traded after their initial issuance, they may trade at a discount from their
initial offering price, depending on the market for similar securities and other
factors, including general economic conditions and the financial condition and
performance of the Company. Prospective investors in the Securities should be
aware that they may be required to bear the financial risks of such investment
for an indefinite period of time. See "Description of Warrants."

REQUIREMENTS FOR EXERCISING WARRANTS

Holders of Warrants will be able to exercise their Warrants only if a
registration statement relating to the shares of Common Stock underlying the
Warrants is then in effect, or the exercise of such Warrants is exempt from the
registration requirements of the Securities Act, and such securities are
qualified for sale or exempt

15
<PAGE> 20

from qualification under the applicable securities laws of the states in which
the various holders of the Warrants reside. Although the Company is required
under the terms of the Warrant Agreement to file and use its best efforts to
make effective a shelf registration statement on an appropriate form under the
Securities Act covering issuance of Common Stock upon the exercise of the
Warrants, there can be no assurance that the Company will be able to do so in a
timely manner. The Company will be unable to issue shares of Common Stock to
those persons desiring to exercise their Warrants if a registration statement
covering the securities issuable upon the exercise of the Warrants is not
effective (unless the sale and issuance of shares upon the exercise of such
Warrants is exempt from the registration requirements of the Act) or if such
securities are not qualified or exempt from qualification in the states in which
the holders of the Warrants reside. See "Description of the Warrants."

CONVERSION OF PREFERRED STOCK

Each holder of Series B Preferred Stock or Series C Preferred Stock has the
right to convert such holder's shares of Series B Preferred Stock or Series C
Preferred Stock into shares of Common Stock at any time. See "Description of
Capital Stock -- Preferred Stock." As of June 30, 1998, the Company has reserved
1,372,300 shares of Common Stock for issuance upon conversion of the issued and
outstanding Series B Preferred Stock and 2,328,543 shares of Common Stock for
issuance upon conversion of the issued and outstanding Series C Preferred Stock.
Under the antidilution provisions of the Series B Preferred Stock and Series C
Preferred Stock, the conversion price thereof is subject to adjustment in
certain events. See "Description of Capital Stock -- Preferred Stock." Any such
adjustments that result in a decrease in the conversion price of the Series B
Preferred Stock and Series C Preferred Stock will result in an increase in the
number of shares of Common Stock issuable upon conversion of such securities. In
the event of such an adjustment, if there is not a corresponding increase in the
number of shares of Common Stock issuable upon exercise of the Warrants pursuant
to the antidilution provisions thereof, then the holders of the Warrants could
be diluted. See "Description of Warrants -- General."

CONTROL BY EXISTING SECURITY HOLDERS AND MANAGEMENT

As of June 15, 1998, (i) the beneficial owners of 5% or more of the
outstanding shares of Common Stock beneficially owned an aggregate of
approximately 74.9% of the outstanding shares of Common Stock and (ii) the
Company's directors and officers (including members of the Board of Directors
designated by the holders of the Series A Preferred Stock, the Series B
Preferred Stock and the Series C Preferred Stock) beneficially owned an
aggregate of approximately 50.7% of the outstanding shares of Common Stock. See
"Principal Security Holders." Accordingly, all such stockholders acting together
effectively could control the Company and certain of such stockholders acting
together could exert substantial influence with regard to matters requiring
stockholder approval. In addition, the Company and substantially all of the
stockholders of the Company are parties to an agreement that provides for the
designation of all the Company's directors and restricts the Company's ability
to increase the number of directors. See "Description of Capital Stock --
Certain Appointments to the Board of Directors." The Company's Certificates of
Designations creating the Series A Preferred Stock, the Series B Preferred Stock
and the Series C Preferred Stock also include certain provisions that restrict
the Company's ability to enter into certain transactions or take certain actions
without the approval of the holders of two-thirds of the outstanding shares of
each of the Series A Preferred Stock, the Series B Preferred Stock and the
Series C Preferred Stock. See "Description of Capital Stock." This concentration
of ownership and the terms of such agreements and Certificates of Designations
may have the effect of delaying or preventing a change in control of the
Company.

ABSENCE OF DIVIDENDS

The Company has not paid and does not anticipate paying any cash dividends
on its Common Stock in the foreseeable future. The Company intends to retain its
earnings, if any, for use in the Company's growth and ongoing operations. In
addition, the terms of the Indenture, the Series A Preferred Stock, the Series B
Preferred Stock and the Series C Preferred Stock restrict the ability of the
Company to pay dividends on the

16
<PAGE> 21

Common Stock. Holders of the Warrants will not have the right to receive any
dividends so long as their Warrants are unexercised.

ANTI-TAKEOVER PROVISIONS

The Company's Bylaws and the Delaware General Corporation Law (the "DGCL")
contain certain provisions that may have the effect of discouraging, delaying or
making more difficult a change in control of the Company or preventing the
removal of incumbent directors. In addition, the Series A Preferred Stock, the
Series B Preferred Stock and the Series C Preferred Stock are redeemable upon
certain changes in control. The existence of these provisions may have a
negative impact on the price of the Common Stock and may discourage third-party
bidders from making a bid for the Company or may reduce any premiums paid to
stockholders for their Common Stock. Furthermore, the Company is subject to
Section 203 of the DGCL, which could have the effect of delaying or preventing a
change in control of the Company. See "Description of Capital Stock -- Certain
Provisions of the Certificate of Designations, Bylaws and Delaware Law."

USE OF PROCEEDS

The maximum gross proceeds to the Company from the exercise of the Warrants
and the issuance of the Common Stock offered hereby (assuming all Warrants are
exercised at the current exercise price of $.01 per share) would be $5,053.75.
The Company intends to use any such proceeds for working capital and general
corporate purposes. The Company will not receive any proceeds from the sale of
the Warrants offered hereby.

The net proceeds to the Company from the Unit Offering were approximately
$71.5 million. The Company placed approximately $19.2 million of such net
proceeds into an escrow account that was used to purchase a portfolio of U.S.
government obligations (the "Pledged Securities"). The account and the Pledged
Securities were pledged as security for payment of the first four scheduled
interest payments on the Notes and, under certain circumstances, as security for
repayment of principal of the Notes. See "Description of the Notes." The Company
intends to use the remainder of the net proceeds from the Unit Offering of
approximately $52.3 million principally in connection with the installation of
the PNV Network at additional truckstops, the addition of certain equipment to
the PNV Network, marketing and sales efforts, working capital and other general
corporate purposes, including possible acquisitions of companies engaged in
similar or complementary businesses. The Company has no present agreements,
arrangements or commitments and has not engaged in any negotiations or
evaluations with respect to any such transaction. Pending application of the net
proceeds from the Unit Offering as described above, the Company intends to
invest the net proceeds in short-term, investment grade, interest-bearing
securities.

17
<PAGE> 22

CAPITALIZATION

The following table sets forth the cash, cash equivalents, and short-term
and restricted investments and capitalization of the Company as of June 30,
1998. The following table should be read in conjunction with the financial
statements and notes thereto of the Company included elsewhere herein.

<TABLE>
<CAPTION>
JUNE 30,
1998
------------
<S> <C>
Cash, cash equivalents, and short-term and restricted
investments(1)............................................ $ 71,113,572
============
Long-term debt:
13% Senior Notes due 2008................................. $ 70,419,566
Other long-term debt, less current portion................ 185,174
------------
Total long-term debt, excluding current portion... 70,604,740
------------
Series A Redeemable Preferred Stock (including accrued
dividends of $542,538), par value $.01 per share; 627,630
shares authorized; 388,075 shares issued and
outstanding............................................... 4,301,345
Series B Redeemable 7% Cumulative Convertible Preferred
Stock (including accrued dividends of $1,712,083), par
value $.01 per share; 1,372,370 shares authorized, issued
and outstanding........................................... 16,316,432
Series C Redeemable 7% Cumulative Convertible Preferred
Stock (including accrued dividends of $1,115,631), par
value $.01 per share; 3,750,000 shares authorized;
2,328,543 shares issued and outstanding................... 18,516,147
Common Stockholders' Deficit:
Common stock, par value $.001 per share; 12,000,000 shares
authorized; 4,318,182 shares issued and outstanding.... 4,318
Additional paid-in capital................................ 5,197,212
Accumulated deficit....................................... (25,471,293)
------------
Total common stockholders' deficit................ (20,269,763)
------------
Total capitalization.............................. $ 89,468,901
============
</TABLE>

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

(1) Includes the aggregate principal amount of the Pledged Securities of
approximately $19.3 million. See "Description of the Notes."

18
<PAGE> 23

SELECTED FINANCIAL DATA

The selected financial data for the Predecessor for the period from January
1, 1995 to November 2, 1995, and for the Successor for the period from September
18, 1995 (Successor's date of incorporation) to June 30, 1996 and the years
ended June 30, 1997 and 1998 set forth below are derived from the audited
financial statements of the Predecessor and the Successor for such periods
included elsewhere in this Prospectus. The selected financial data set forth
below for the Predecessor for the period from November 19, 1993 (date of
inception) to December 31, 1993 and for the year ended December 31, 1994 are
derived from audited financial information. These historical results are not
necessarily indicative of the results that may be expected in the future. The
selected financial data are qualified by reference to and should be read in
conjunction with "Management's Discussion and Analysis of Financial Condition
and Results of Operations," the financial statements and notes thereto and other
financial data included elsewhere in this Prospectus.

<TABLE>
<CAPTION>
PREDECESSOR(1) SUCCESSOR(1)
------------------------------------------- --------------------------------------------
PERIOD FROM PERIOD PERIOD FROM
NOVEMBER 19, FROM SEPTEMBER 18,
1993 (DATE OF JANUARY 1, 1995 (DATE OF
INCEPTION) TO YEAR ENDED 1995 TO INCORPORATION) YEAR ENDED
DECEMBER 31, DECEMBER 31, NOVEMBER 2, TO JUNE 30, JUNE 30, YEAR ENDED
1993 1994 1995 1996 1997 JUNE 30, 1998
------------- ------------ ------------ -------------- ----------- -------------
<S> <C> <C> <C> <C> <C> <C>
STATEMENT OF OPERATIONS DATA:
Revenues........................... $ 149,755 $ 888,397 $ 3,503,776
Cost of revenues(2)................ 436,829 2,077,689 6,598,993
----------- -----------
Gross margin....................... (287,074) (1,189,292) (3,095,217)
Selling, general and administrative
expenses......................... $ 7,792 $ 287,782 $ 475,891 1,576,209 4,431,889 10,378,471
Write down of equipment............ 594,691 35,151
------- --------- --------- ----------- ----------- ------------
Loss from operations............... (7,792) (287,782) (475,891) (1,863,283) (6,215,872) (13,508,839)
Interest expense................... 103,079 157,416 1,030,594
Interest income and other.......... (5,125) (328,268) (805,686)
------- --------- --------- ----------- ----------- ------------
Net loss........................... $(7,792) $(287,782) $(475,891) $(1,961,237) $(6,045,020) $(13,733,747)
======= ========= ========= =========== =========== ============
Net loss attributable to common
stockholders..................... $(1,982,607) $(6,962,402) $(16,526,284)
OTHER OPERATING DATA:
EBITDA(3).......................... $(7,792) $(287,782) $(475,891) $(1,778,942) $(5,572,556) $(11,602,107)
Capital expenditures............... 65,404 109,587 909 1,650,177 6,443,899 12,596,875
Amount that earnings were
insufficient to cover fixed
charges(4)....................... (1,961,237) (6,045,020) (13,733,747)
Amount that earnings were
insufficient to cover fixed
charges and preferred stock
dividend requirements(4)......... (1,982,607) (6,962,402) (16,526,284)
Net cash flows used in operating
activities....................... (7,792) (254,311) (389,809) (1,452,706) (3,400,128) (9,375,071)
Net cash flows used in investing
activities....................... (65,404) (109,587) (909) (1,650,177) (6,443,899) (63,899,791)
Net cash flows provided by
financing activities............. 87,500 369,449 380,070 3,468,614 14,197,690 88,368,124
</TABLE>

<TABLE>
<CAPTION>
PREDECESSOR(1) SUCCESSOR(1)
--------------------------- -------------------------------------------
AS OF DECEMBER 31, AS OF JUNE 30,
--------------------------- -------------------------------------------
1993 1994 1996 1997 1998
------------ ------------ -------------- ----------- ------------
<S> <C> <C> <C> <C> <C> <C>
BALANCE SHEET DATA:
Cash and cash equivalents......................... $ 14,304 $ 19,856 $ 365,731 $ 4,717,394 $ 19,810,656
Working capital................................... 14,304 6,521 (81,610) 2,813,544 66,652,141
Total assets...................................... 79,708 174,711 2,898,125 12,938,783 94,578,127
Total long-term debt.............................. 87,500 216,667 3,387,934 425,430 70,604,740
Total redeemable preferred stock.................. -- -- 721,370 19,131,466 39,133,924
Partnership deficiency/ common stockholders'
deficit......................................... (7,792) (55,292) (1,969,525) (8,931,927) (20,269,763)
</TABLE>

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

(1) Park 'N View, Ltd. transferred certain of its assets, contractual rights and
liabilities to Park 'N View, Inc. in exchange for 2,318,182 shares of common
stock issued to the former partners of Park 'N View, Ltd. The net
liabilities transferred were recorded by Park 'N View, Inc. at Park 'N View,
Ltd.'s historical carrying amount of $84,446. The financial information
identified herein as for the Predecessor is for Park 'N View, Ltd. as of
December 31, 1993 and 1994 and for period from November 19, 1993 (date of
inception) to December 31, 1993, the year ended December 31, 1994 and the
period from January 1, 1995 to November 2, 1995, the date the net
liabilities were transferred to Park 'N View, Inc. The financial information
identified herein as for the Successor is for Park 'N View, Inc. as of June
30, 1996,

19
<PAGE> 24

1997 and 1998 and for the period from September 18, 1995 (date of
incorporation) to June 30, 1996 and for the years ended June 30, 1997 and
1998.

(3) EBITDA is earnings (loss) from operations before interest, taxes, and
service depreciation. EBITDA is a measure of a company's performance
commonly used in the telecommunications industry, but should not be
construed as an alternative to net income (loss) determined in accordance
with GAAP as an indicator of operating performance or as an alternative to
cash from operating activities determined in accordance with GAAP as a
measure of liquidity. EBITDA is an earnings calculation that is used by
certain investors and in particular debt holders as one measure of an
ability to service debt, pay taxes and provide for working capital and
capital expenditure requirements. However, it does not reflect cash
generated because it does not include changes in working capital or capital
expenditures. It also is not an accounting measure that is in conformity
with GAAP because it does not include interest, taxes, depreciation and
amortization which are significant components in understanding and assessing
the Company's financial performance. The trend in EBITDA must be evaluated
by taking into consideration the trend in interest, taxes, depreciation, and
amortization expenses. If these expenses are considered, a trend in EBITDA
may reflect the Company's utilization of financial debt and fixed asset
resources. Also, management believes that in a capital intensive business
that is highly leveraged, the earnings coverage for interest is important to
debt holders and investors in the Company as an indicator of whether there
may be a potential default to the debt holders because of the inability to
cover interest and principal. The Company's computation of EBITDA may not be
comparable to similarly titled measures reported by other companies.

20
<PAGE> 25

MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS

The following discussion of the financial condition and results of
operations should be read in conjunction with the financial statements and other
financial information included elsewhere in this Prospectus. The following
discussion includes certain forward-looking statements. For a discussion of
important factors, including, but not limited to the fact that there can be no
assurance that the Company's results of operations will not be adversely
affected by one or more of these factors, that the Company undertakes no
obligation to publicly update or revise any forward-looking statements, whether
as a result of new information, future events or otherwise, and other factors
that could cause actual results to differ materially from the forward-looking
statements, see "Risk Factors."

OVERVIEW

Background. From November 1993 to November 1995, Park 'N View, Ltd.
developed the PNV Network and installed and operated the PNV Network at one
truckstop as a field test. There were no revenues or significant selling
expenses generated by Park 'N View, Ltd. during this period. Following the
formation of the Company in September 1995, and the transfer to the Company of
the business and net liabilities of Park 'N View, Ltd., the Company began the
build-out of the PNV Network utilizing principally proceeds from sales of its
securities. See "Certain Transactions." As of June 30, 1998, the PNV Network was
available at 118 full-service truckstops. During June 1998, the Company had over
25,000 subscribers (including approximately 2,329 drivers sponsored by five
fleets under contracts with the Company), an increase of over 166% from the
9,400 subscribers the Company had in July 1997. The telecommunications and
entertainment services currently offered by the Company through the PNV Network
consist principally of local and long-distance telephone access, incoming calls,
voice messaging and driver location, data, Internet connectivity, cable
television and a Pay-Per-View channel. See "Business -- Products and Services."

Components of Revenues

To date, the Company's revenues have been generated principally from sales
of monthly and daily subscriptions to the PNV Network, as well as daily access
subscriptions to a Pay-Per-View channel, and, to a lesser extent, sales of long
distance telephone time and starter kits to long-haul truck drivers. The Company
markets the PNV Network to both long-haul fleet trucking companies who sponsor
their drivers and to the individual long-haul truck drivers. Subscribers first
purchase a membership card and starter kit for $10 (which fee is waived for
fleet and Power Plan subscribers). Subscribers then sign-up for $30 per month or
purchase a monthly or daily card for $30 or $5, respectively, from vending
machines at the truckstop. Fleets purchase a guaranteed minimum number of $30
monthly subscriptions for a period of one year or more. Monthly subscribers
currently receive 60 minutes of free long distance. The Company's sales to truck
drivers at the Company's vending machines are cash transactions completed at the
point of sale. Under the Power Plan Program, a subscriber's monthly subscription
is automatically renewed and the monthly fee is automatically drafted from or
charged to the subscriber's checking account or credit card. In connection with
initially subscribing under the Power Plan Program, a subscriber receives a
two-month subscription for $30, paid in advance. See "Business -- Marketing."
Power Plan subscribers may cancel their subscriptions at any time. The Company
currently has one Pay-Per-View channel, The Playboy Channel (which as of June
30, 1998 was available at approximately 52% of the truckstops as permitted by
the truckstop owner) for which it charges $5 for daily access. As of June 30,
1998, the Company has experienced a 16% penetration rate for this service.

The Company currently sells equipment (extender kits) at a price of $9.99
directly to the truckstop for final sale to the truckdriver. All sales are final
with no price protection or right of return.

In January 1998, the Company ran a promotional test of the resale of long
distance minutes to a select group of subscribers that was very successful. The
Company now offers all Power Plan subscribers the ability to purchase additional
long distance minutes from the convenience of their truck cab. The Company plans
to roll-out the opportunity for all subscribers to purchase long distance
minutes by the end of 1998.

21
<PAGE> 26

By December 1998, the Company plans to deploy a $20 value card at selected
truckstops. This card, which will be available for purchase in vending machines
located at such truckstops will serve as an additional method of payment for
both long distance minutes and Pay-Per-View programming.

In the future, the Company anticipates that sales of subscriptions to the
PNV Network, resale of long distance minutes, and Pay-Per-View purchases will
generate the majority of the Company's revenues. To a lesser extent, the Company
anticipates that providing Internet Service Provider (ISP) services and selling
advertising on its dedicated cable advertising channel will become sources of
revenue for the Company.

The Company plans to offer the following products and services, among
others:

ISP Service -- Expansion of the PNV Network to include the T-1 lines
and frame relay network will enable the Company to become an ISP. The
Company intends to charge subscribers to the ISP service a competitive
monthly access fee.

Advertising -- The current PNV Network allows the Company the ability
to carry dedicated advertising and programming channels on a contract
basis.

The Company generally recognizes service revenue in the period earned.
Prepaid service revenues are recorded as deferred revenue until earned. Fees
received relating to Power Plan Program and monthly subscription sales are
recorded as revenue ratably over the subscription period.

Cost of Revenues

Current Network. The Company's fixed operating expenses currently consist
principally of amortization of capitalized costs of the PNV Network (service
depreciation), cable programming (which is purchased by the Company on a per
parking stall basis) and leased POTS lines at truckstops (the Company presently
maintains an average of 12 POTS lines at each truckstop).

The Company's variable operating expenses consist principally of long
distance telephone service, revenue and profit sharing commissions paid to
certain truckstop owners which have entered into long-term contracts with the
Company and the starter kit equipment. Variable telephone service costs, until
the Company recently began to resell long distance minutes, were comprised of
the cost of providing 60 free minutes of long distance together with a monthly
subscription.

Pursuant to the terms of the contracts with the truckstop owners'
commission expenses are comprised of commissions payable in an amount equal to
(a) 35% of revenues after deducting promotions and sales tax of approximately
$8.60 from sales from on-site vending machines for the first five years and 40%
for the second five years, and (b) with regard to a Power Plan subscription, 35%
of revenue after deducting promotions and sales tax of approximately $8.60 for
the first month of service and 10% of revenues thereafter. The contracts further
provide that the Company will pay an additional commission to truckstop owners
equal to 10% of its revenues from subscription sales to fleets pro rata based on
the number of their stalls.

All direct cost incurred in producing the advertising ad is expensed.
Direct cost would include video editing and filming time.

Equipment sales cost are comprised of component and labor costs of building
extension and starter kits. Extension kits are expensed when sold to the
truckstop. Starter kits are expensed when new members subscribe to the network.

Future Network. The Company has recently entered into contracts with AT&T
for the lease of T-1 lines and the purchase of long distance and other telephone
services. Under these contracts, for the periods specified therein, the Company
is required to pay a specified minimum dollar amount of lease payments and to
purchase a specified minimum dollar amount of long distance telephone services,
each of which amounts is subject to certain discounts based on the T-1 lines
leased and the telephone services purchased. See "Business -- Products and
Services -- Future Products and Services" and "Risk Factors -- Expansion of the
PNV Network Installation and Services; Future Revenue Streams; Minimum
Requirements Contracts; Cost-Savings." The Company believes that the addition of
the T-1 lines to the PNV Network will reduce the

22
<PAGE> 27

Company's telephone backbone cost and reduce its per minute long distance costs.
The Company believes that fixed costs related to these Network enhancements will
increase but variable costs will decrease.

Selling Expenses

The Company markets to fleet trucking companies through a direct sales
force and intends to increase this sales force. Selling expenses have therefore
consisted principally of salaries, benefits, travel and marketing expenses. In
addition, the Company sells subscriptions at truckstops through its vending
machines and has marketed subscriptions through point-of-sale merchandising
materials and in addition, at larger sites, through field sales representatives.
The Company expects to add approximately 100 persons to its sales force over the
next 12 months.

General and Administrative Expenses

The Company has significantly increased the size of its management team and
the number of its full-time employees has increased to 174 as of June 30, 1998
from 74 as of June 30, 1997, all of which resulted in a significant increase in
general and administrative expenses. The Company expects that general and
administrative expenses will increase substantially as it expands its marketing
and sales programs, operations and administrative staff to accommodate the
growth in new sites and memberships. Such expenses will be incurred in advance
of anticipated related revenues.

RESULTS OF OPERATIONS

Year Ended June 30, 1998 Compared to the Year Ended June 30, 1997

Revenues. The Company's revenues increased 295% to $3,504,000 for the year
ended June 30, 1998 from $888,000 for the year ended June 30, 1997. The
significant component of the Company's revenues was service revenue which
increased 342% to $3,334,000 for the year ended June 30, 1998 from $755,000 for
the year ended June 30, 1997 primarily due to an increase in subscription sales
and an increase in subscription fees initiated in May 1997.

Cost of Revenues. Cost of revenues, excluding service depreciation,
increased 227% to $4,692,000 for the year ended June 30, 1998 from $1,434,000
for the year ended June 30, 1997 principally due to increased sales volume. Cost
of revenues includes commissions payable to truckstops, cable programming,
leased telephone lines, equipment and freight. As the Company increases the
number of truckstops at which it installs the PNV Network per month, and the
aggregate number of truckstop stalls, the Company believes that cost of revenues
will increase significantly.

Selling Expenses. Selling expenses increased 281% to $5,195,000 for the
year ended June 30, 1998 from $1,365,000 for the year ended June 30, 1997. The
primary components of the Company's selling expenses are salaries, travel and
marketing expenses in the amount of $4,967,000 for the year ended June 30, 1998
and $1,285,000 for the year ended June 30, 1997. The increase primarily reflects
the addition of sale personnel and marketing efforts for new sites and support
staff to execute "Power Plan" sales.

General and Administrative Expenses. General and administrative expenses
increased 70% to $5,183,000 for the year ended June 30, 1998 from $3,067,000.
The primary components of the Company's general and administrative expenses are
salaries and travel expenses in the amount of $3,858,000 for the year ended June
30, 1998 and $2,558,000 for the year ended June 30, 1997. The increase is due to
additional administrative personnel to support additional sites.

Service Depreciation. Service depreciation increased 197% to $1,907,000
for the year ended June 30, 1998 from $643,000 for the year ended June 30, 1997
resulting primarily from the Company's increased build-out of the Network.

Interest Income (Expense) and Other-Net. Interest income (expense) and
other-net decreased $396,000 to $(225,000) for the year ended June 30, 1998 from
$171,000 for the year ended June 30, 1997, reflecting an increase in interest
income of $477,000 from investment of cash in short-term investments and a

23
<PAGE> 28

increase in interest expense and other-net of $873,000. The increase in interest
expense is primarily related to interest on the Senior Notes. See Note 5 to the
financial statements.

Net Loss. The Company's net loss increased 127% to $13,734,000 for the
year ended June 30, 1998 from $6,045,000 for the year ended June 30, 1997
primarily as a result of the foregoing factors.

Year Ended June 30, 1997 Compared to Period from September 18, 1995 (Date of
Incorporation) to June 30, 1996

Revenues. The Company's revenues increased $738,000 to $888,000 for the
year ended June 30, 1997 from $150,000 for the period from September 18, 1995 to
June 30, 1996 (the "fiscal 1996 period"). The significant component of the
Company's revenues was service revenue which increased $687,000 for the year
ended June 30, 1997 to $755,000 from $68,000 for the fiscal 1996 period,
reflecting additional subscription sales volume to the PNV Network in the year
ending June 30, 1997.

Cost of Revenues. Cost of revenues, excluding service depreciation,
increased $1,082,000 to $1,434,000 for the year ended June 30, 1997 from
$352,000 for the fiscal 1996 period principally due to increased subscription
sales volume.

Selling Expenses. Selling expenses increased $868,000 to $1,365,000 for
the year ended June 30, 1997 from $497,000 for the fiscal 1996 period. The
primary components of the Company's selling expenses are salaries, travel and
marketing expenses in the amount of $1,285,000 for the year ended June 30, 1997
and $497,000 for the fiscal 1996 period. The increase consists of additional
sales personnel for new sites built during the year.

General and Administrative Expenses. General and administrative expenses
increased $1,988,000 to $3,067,000 for the year ended June 30, 1997 from
$1,079,000. The primary components of the Company's general and administrative
expense are salaries and travel expenses in the amount of $2,558,000 for the
year ended June 30, 1997 and $517,000 for the fiscal 1996 period. The increase
is primarily from adding administrative personnel to support sites built
throughout the year.

Service Depreciation. Service depreciation increased $559,000 to $643,000
for the year ended June 30, 1997 from $84,000 for the fiscal 1996 period
resulting primarily from the Company's increased build-out of the Network.

Interest Income (Expense) and Other-Net. Interest income (expense) and
other-net increased $269,000 to $171,000 for the year ended June 30, 1997 from
($98,000) for the fiscal 1996 period reflecting an increase in interest income
of $297,000 from investment of cash in short-term investments and a gain on a
sale of fixed assets of $26,000, which was partially offset by an increase in
interest expense of $54,000. The principal amount of the related debt
securities, together with interest accrued thereon, was converted by the holders
thereof into shares of Series A Preferred Stock. See "Certain Transactions" and
Note 5 to the financial statements.

Net Loss. The Company's net loss increased $4,084,000 to $6,045,000 for
the year ended June 30, 1997 from $1,961,000 for the fiscal 1996 period
primarily as a result of the foregoing factors.

LIQUIDITY AND CAPITAL RESOURCES

Since the Company's incorporation in September 1995, the Company has
satisfied its cash requirements through the proceeds of issuances of three
classes of preferred stock, Common Stock, certain debt securities and the Units
(an aggregate of $112.4 million) and cash generated from operations.

From November 1995 to November 1996, in connection with the capitalization
of the Company, certain investment limited partnerships managed by Patricof &
Co. Ventures, Inc. (the "Patricof Managed Funds") invested $3.8 million in the
Company, purchasing shares of the Company's Series A Preferred Stock, par value
$.01 per share ("Series A Preferred Stock") and the Company's common stock, par
value $.001 per share (the "Common Stock") as well as debt securities of the
Company. In November 1996, a group of investors comprised of the Patricof
Managed Funds and certain partners in such funds made an additional

24
<PAGE> 29

$15.0 million investment in the Company, purchasing shares of the Company's
Series B 7% Cumulative Convertible Preferred Stock, par value $.01 per share
(the "Series B Preferred Stock"). In August 1997, a group of investors,
including the Patricof Managed Funds, invested $18.6 million in the Company,
purchasing shares of the Company's Series C 7% Cumulative Convertible Preferred
Stock, par value $.01 per share (the "Series C Preferred Stock"). See Notes 1
and 6 of Notes to financial statements.

On May 27, 1998, the Company sold 75,000 Units, consisting of an aggregate
$75,000,000 of its 13% Senior Notes due 2008 and 75,000 Warrants, for net
proceeds after commissions, but before offering expenses, of $72,375,000. See
"Use of Proceeds."

Net cash used in operating activities was $9,375,000 and $3,400,000 for the
year ended June 30, 1998 and 1997, respectively, and $1,453,000 for the fiscal
1996 period. The $5,975,000 increase in net cash used in operating activities
for the year ended June 30, 1998 as compared to the year ended June 30, 1997
resulted primarily from increased marketing and additional staff to support the
larger number of sites and subscribers. The $1,947,000 increase in net cash used
in operating activities for the year ended June 30, 1997 as compared to the
fiscal 1996 period resulted principally from additional administrative needs to
support the Company's build-out schedule.

Net cash used in investing activities was $63,900,000 and $6,444,000 for
the years ended June 30, 1998 and 1997, respectively, and $1,650,000 for the
fiscal 1996 period. The $57,456,000 increase in net cash used in investing
activities for the year ended June 30, 1998 as compared to the year ended June
30, 1997 resulted primarily from the additional buildout of the PNV Network and
the purchase of short-term investment securities. The $4,794,000 increase in net
cash used in investing activities for the year ended June 30, 1997 as compared
to the fiscal 1996 period resulted principally from the additional build-out of
the PNV Network.

Net cash provided by financing activities was $88,368,000 and $14,198,000
for the years ended June 30, 1998 and 1997, respectively, and $3,469,000 for the
fiscal 1996 period. The $74,170,000 increase in net cash provided by financing
activities for the year ended June 30, 1998 as compared to the year ended June
30, 1997 resulted primarily from the issuance of Series C Preferred Stock and
the Unit Offering. The $10,729,000 increase in net cash provided by financing
activities for the year ended June 30, 1997 as compared to the fiscal 1996
period resulted principally from the issuance of the Series B Preferred Stock.
See "Certain Transactions" and Note 6 to the financial statements.

The Company's capital commitments consist primarily of capital leases and
noncancellable operating leases for office space, furnishings, equipment and T-1
lines. In addition, the Company recently entered into a contract for the
purchase of long distance and other telephone services that contains minimum
purchase requirements for a two-year period. Pursuant to the contract for the
lease of T-1 lines, the Company is required to lease approximately (i) 200 T-1
lines having minimum payments, before available discounts, of $5.1 million
during the first year following the start-up period, and (ii) 300 T-1 lines
having minimum payments, before available discounts, of $7.7 million during the
second and third years following the start-up period. The start-up period ends
in February 1999 or such earlier date as to which the Company gives AT&T notice.
In addition, the Company's contract with AT&T for long distance and other
telephone services requires the Company for a term of two years to purchase each
month, at minimum, services having an undiscounted price of $40,000 based upon
standard AT&T rates. Discounts are available under each contract. The Company
may terminate the contracts with AT&T at any time, but, upon termination, the
Company generally would become obligated to pay to AT&T the remaining aggregate
undiscounted required minimum amounts under each contract. See
"Business -- Products and Services -- Future Products and Services" and "Risk
Factors -- Expansion of PNV Network Installation and Services; Future Revenue
Streams; Minimum Requirements Contracts; Cost-Savings." At June 30, 1998, the
Company's minimum commitments under capital leases and noncancellable operating
leases with terms in excess of one year, which do not include commitments under
the contracts relating to the lease of T-1 lines and purchase of long distance
and other telephone services, totaled $632,913, $422,639, $316,541, $188,637 and
$28,962 for the five years ending June 30, 1998 through 2002, respectively. See
Note 4 to the financial statements. In addition, the Company currently plans to
make capital expenditures associated with the installation of certain routing
and switching equipment at each truckstop at which the PNV Network is available
estimated at an aggregate expenditure of

25
<PAGE> 30

$3.8 million ($15,000 per site) through June 1999. Such installation, together
with the installation of the T-1 lines, will substantially complete the
Company's planned enhancements to the PNV Network. See "Business -- Network and
Technology."

The Company expects that it will have significant capital requirements in
the future to fund the continued expansion of its business and for working
capital purposes, and there can be no assurance that such capital requirements
will be available on terms satisfactory to the Company, if at all. The Company's
capital requirements will depend on numerous factors, including the growth of
the Company's revenues, if any, and the rate of such growth. The Company expects
that existing cash and anticipated cash generated by operations, will be
sufficient to fund its planned expansion and operations to at least the first
half of 2000. Thereafter, if the Company's cash flow from operations is not
sufficient to provide funds for working capital and capital expenditures and if
equity, debt or other financing is not available, the Company expects that it
may experience insufficient liquidity which could have a material adverse effect
on the Company's financial condition and results of operations. There can be no
assurance that additional financing will be available when needed, if at all,
or, if available, on terms acceptable to the Company. If adequate funds are not
available on acceptable terms, the Company will be required to delay or limit
any further expansion of its business. Any inability to fund its future capital
requirements could have a material adverse effect on the Company's business,
financial condition and operating results. See "Risk Factors -- Future Capital
Requirements; Uncertainty of Additional Funding."

YEAR 2000

A potential problem exists for all companies that rely on computers as the
year 2000 approaches. The "Year 2000" problem is the result of the past practice
in the computer industry of using two digits rather than four to identify the
applicable year. This practice could result in incorrect results when computers
perform arithmetic operations, comparisons or data field sorting involving years
later than 1999. The Company is in the process of conducting a review of its
computer systems to identify the systems that could be affected by the "Year
2000" issue and is developing a plan to address the issue. The Company has not
made any progress in assessing its non-information technology systems. These
types of systems are more difficult to assess and repair than information
technology systems and the Company may have to replace the non-information
technology systems that cannot be repaired. The Company will begin reviewing its
non-information technology systems in second half of 1999. The Company will
utilize both internal and, if needed, external resources to reprogram or replace
and test all of its software for Year 2000 compliance, and the Company expects
to complete the project during the second half of 1999. The Company estimates
that costs incurred in connection with any such testing and required
reprogramming and replacement will not have a material adverse effect on the
Company's financial condition or results of operations. The Company has a
preliminary estimate of $300,000 as the maximum cost of evaluating, testing,
reprogramming, and modifying software. This estimate is based on the belief that
no major problems will be encountered in becoming Year 2000 compliant. Based on
its preliminary internal review, the Company believes that the Company-developed
software is Year 2000 compliant. However, the Company plans to do more extensive
testing of its PNV Software during the next year which may require the use of
independent consultants to assist in the Company's evaluation to assure a
correct assessment of cost and risk. In addition, the Company relies on third
party vendors which must also become Year 2000 compliant. The Company has a
significant reliance on outside vendors such as telephone companies, satellite
system providers, electrical providers and the wide area network supplier. These
services are critical in the Company's ability to generate revenue. The ability
of third parties with whom the Company transacts business to adequately address
their 2000 issue is outside of the Company's control. The Company is planning to
create a comprehensive list of all internal and external software programs to
assure that a full review of such software is completed. However, if any
necessary modifications to the PNV Software are not completed in a timely manner
or if the Company's vendors are not Year 2000 compliant, the Year 2000 problem
may have a material adverse impact on the operations of the Company.

26
<PAGE> 31

BUSINESS

OVERVIEW

The Company originated and operates the only currently integrated
telecommunications and entertainment network (the "PNV Network" or "Network")
currently capable of providing voice, data and cable television services to
long-haul truck drivers in the convenience and privacy of their trucks while
parked at truckstops. The Company markets and sells subscriptions to its Network
to fleet trucking companies and individual long-haul truck drivers. Based on
independent market research commissioned by the Company and industry data, the
Company believes that there are between 800,000 and 1,000,000 long-haul truck
drivers in the United States. During June 1998, the Company had over 25,000
active subscribers, an increase of over 166% from the approximately 9,400
subscribers it had in June 1997. The Company was formed in September 1995 and,
as of June 30, 1998, had installed the PNV Network in 118 truckstops located in
38 states across the United States.

The PNV Network provides a full range of high quality, cost-effective
telecommunications and cable television services over land-based lines. Users
connect to the Network by attaching standard telephone and coaxial television
cables (which the Company provides to each new subscriber) to outlets, called
"Bollards," installed in the ground at each parking stall at a truckstop. The
telecommunications services currently provided include: (i) local and long
distance calling, in-coming calls, voice mail services and driver location; (ii)
data connectivity; (iii) access to the Internet; and (iv) other
telecommunications services, including wake up calls and the ability to offer
call waiting and call conferencing. The cable television service offers 18 cable
viewing channels, including premium and local programming, a Pay-Per-View
channel and a dedicated advertising channel.

The long-haul trucking industry's operational characteristics require
significant reliance on telecommunications. Based on industry data, Company
research and data from the Company's switch, the Company believes that long-haul
fleet trucking companies and drivers spend over $2.4 billion annually on long
distance services (not including data, Internet and messaging). The Company
believes that the level of telephone usage at truckstops is second only to that
of airports. According to data generated from the Company's switch and Company
research, the average long-haul truck driver that logs on to the Network uses
approximately 1,200 minutes of long distance a month, spending approximately
$250 per month. The Company believes that this level of usage is a result of:
(i) the long periods most drivers spend on the road each month, 21 days or more;
(ii) the operational need for drivers to be in regular contact with their
dispatchers and customers concerning load pick-up, deliveries and routes; and
(iii) the drivers' personal communication needs. Drivers and fleet trucking
companies must also regularly exchange data pertaining to proof of delivery,
employee pay information, load availability and permits. The Company believes
that the Internet will increasingly become the preferred method for transmitting
and receiving this type of data.

27
<PAGE> 32

for the fleet trucking companies trying to communicate with their drivers at
these truckstops are limited, relatively expensive and inaccessible.

There are over 2,100 truckstops in the United States located on the
interstate highway system, of which the Company believes approximately 1,100 are
full service truckstops that provide more services than just fuel. The Company
has entered into long-term contracts pursuant to which eight of the ten largest
full service truckstop chains and associations in the United States, including
TA Operating Corporation, Petro Stopping Centers, Inc., Pilot Corporation, and
Professional Transportation Partners, LLC, have granted the Company the
exclusive right to provide telecommunications and entertainment services to
drivers in their cabs at their truckstops. Of the approximately 751 full-service
truckstops under contract as of June 30, 1998, approximately 413 are covered by
contracts directly with the truckstop owner and approximately 338 are covered by
contracts with associations which require the Company to enter into a contract
directly with the truckstop owner to install the PNV Network. The Company also
believes that these approximately 751 full-service truckstops are among the most
heavily trafficked and are located along the busiest truck routes in the United
States. The Company believes that the truckstop owners are highly incentivized
to support the success of the Company as: (i) the contracts contain provisions
for revenue and profit sharing with the Company; (ii) the PNV Network is a means
for competitive differentiation; and (iii) the PNV Network is an amenity that
many long-haul truck drivers have been requesting.

The Company believes that its most significant competitive advantages over
competing telecommunications and entertainment providers include:

- Only provider and first to market. The Company is currently the only
provider with the capability to deliver integrated telecommunications,
access to the Internet and cable entertainment services in the privacy
and convenience of the truck cab.

- Significant barriers to entry. As of June 30, 1998, the Company had
entered into long-term contracts to provide telecommunications and
entertainment services to long-haul drivers at approximately 751 of the
approximately 1,100 full service truckstops across the country. These
contracts are generally for terms of ten years and the Company believes
that they pose a significant barrier to entry to other current or
potential competitive telecommunications and entertainment providers.

- Compelling value to drivers, fleets and truckstops. The Company believes
that the PNV Network represents a compelling value to long-haul drivers,
long-haul fleet trucking companies and truckstops. For drivers, the PNV
Network currently provides cost-effective telephone and cable television
access in the privacy and convenience of their cab. For fleets, the PNV
Network currently provides high levels of accessibility to their drivers
with cost efficiency and, once enhanced, will offer a cost competitive
high capacity voice and data network designed to address their unique
geographic and access needs. For truckstops, the PNV Network provides a
means for competitive differentiation and generating additional revenue.

- Broadband and cost competitive network. The Company has developed the
PNV Network so that it is flexible and upgradable. This foundation will
allow the Company to expand the functionality and capacity of the PNV
Network to provide a broadband, cost competitive voice, data, Internet
and cable television platform. This network will allow the Company to
become, in effect, a private full-service telecommunications network for
the long-haul trucking industry.

The Company provides its telecommunication and entertainment services on a
subscriber basis. Subscribers first purchase a membership card and starter kit
for $10. They can then sign up for an on-going subscription deducted
automatically from their credit card or checking account for $30 per month, or
purchase a monthly or daily usage card for $30 or $5, respectively, from vending
machines located at each truckstop. Each subscription plan has various benefits
associated with it. See "Business -- Products and Services."

The Company markets to fleet trucking companies through a direct sales
force and plans to focus a significant portion of its marketing efforts on large
and medium size fleet trucking companies. The Company strives to negotiate
contracts with fleet trucking companies that contain minimum term and number of
subscriber commitments. Fleet trucking companies are billed for their entire
subscriber group on a monthly

28
<PAGE> 33

basis. The Company recently signed contracts with five fleet trucking companies
that have purchased monthly subscriptions for an aggregate of approximately
2,329 drivers for periods ranging from one to three years, subject to certain
earlier termination rights. The Company also plans to pursue co-marketing
arrangements with certain strategic partners to market the PNV Network to fleet
trucking companies. These partners may include truckstop chains, other
communications services providers, or other providers of services to the long-
haul trucking industry which can help facilitate the marketing and sales
process. The Company markets subscriptions to the PNV Network to individual
truck drivers through field sales representatives working principally at the
larger truckstops and signage, brochures, vending machines and other
merchandising Materials posted and distributed at each truckstop. The Company is
developing incentives to encourage sales to truck drivers by truckstop employees
and is also considering additional marketing strategies, promotional products
and contests.

The architecture of the current PNV Network uses existing proven technology
which includes a PC-based communications server installed at each truckstop
location which is connected by a WAN to the Host Server. The Company plans to
enhance the current capabilities and functionality of the PNV Network by
replacing the POTS lines currently used with T-1 lines which, with certain
additional equipment, will allow for dedicated long distance and a frame relay
network. This will reduce the Company's cost of providing long distance, provide
greater bandwidth for voice and data transmission and result in a design that
continues to be flexible and upgradable. The Company also plans to become an ISP
and develop voice over IP capability. The Company believes that it will be able
to offer highly competitive long distance rates available to large fleet
trucking companies by installing T-1 lines between truckstops and fleet
operation centers. To allow greater access to the PNV Network, the Company plans
to install member-only telephones, which may include both wired and 900 MHz
wireless, inside selected truckstops.

INDUSTRY OVERVIEW

Based on independent market research commissioned by the Company and
industry data, the Company believes that there are between 800,000 and 1,000,000
long-haul truck drivers in the United States. The Company believes that there
are over 19,000 trucking fleets in the United States that operate a total of
approximately 630,000 long-haul trucks. There are approximately 50 fleets that
operate over 1,000 trucks, more than 850 fleets that operate between 100 to
1,000 trucks, and approximately 18,400 fleets that operate fewer than 100
trucks. In addition, there are approximately 140,000 independent long-haul truck
drivers that are not affiliated with any fleet. The Company believes that there
are an additional 30,000 trucks associated with private fleets and 40,000
Canadian-based long-haul drivers who primarily service the United States which
fall within its target market. The trucking industry has been stable over the
last several years and has experienced an increase in intercity ton-miles every
year from 1985 through 1995 and a compounded annual average growth rate of
approximately 4% over this 10-year period.

There are over 2,100 truckstops in the United States along the interstate
highway system, of which the Company believes that approximately 1,100 are
full-service truckstops that provide more than just fuel. A large number of
truckstops are affiliated with or owned by chains that maintain centralized
control over operations. Full service truckstops, generally located on major
interstate highways, offer a full range of services for drivers and fleets
including fueling facilities, certified scales, repair facilities, restaurants,
community television and game rooms, public telephones and showers. These
truckstops are the primary location at which long-haul truck drivers stop to
fuel, eat, shower, park for their rest periods, overnight stays and for layovers
between hauls. This is due to the range of services that these truckstops offer,
their location and the obvious limitations that a large truck has in stopping at
other venues such as regular gas stations, fast food restaurants, malls and
motels. As such, truckstops are the primary location at which drivers conduct
business with fleets and customers, communicate with family and friends, and
seek entertainment.

Industry data, Company research and data collected from the Company's
telephone switch indicates that the long-haul trucking industry is
telecommunications intensive. The Company believes that long-haul drivers and
fleet trucking companies spend over $2.4 billion on long distance services (not
including data, Internet and messaging) annually. According to data generated
from the Company's switch and Company research, long-

29
<PAGE> 34

haul drivers that log on to the Network on average use approximately 1,200
minutes of long distance a month and have monthly expenditures of approximately
$250 for long distance telephone usage.

The high degree of telecommunications usage by long-haul trucking fleets
and drivers is a result of several operational characteristics of the industry.
The nature of the routes and operations of long-haul trucking require that
drivers be on the road for long periods of time. Company research and industry
data indicates that most long-haul truck drivers spend at least 21 days a month
on the road and earn an average of approximately $35,000 per year. Long-haul
trucking requires frequent communication between drivers, fleets and customers.
Long-haul drivers must stay in regular contact with customers and fleet
dispatchers to coordinate load pickup, delivery, and routes. At the same time,
drivers and fleets must exchange administrative paperwork, such as proof of
delivery, permits and employee payroll information (for which they currently use
regular or express mail services). Truck drivers also use telephones for
personal communications purposes to stay in touch with family and friends.

A significant issue facing the long-haul trucking industry is employee
turnover. The Company believes that many fleet trucking companies attempt to
reduce high driver turnover costs (approximately $3,000 per driver) and to
mitigate the high levels of driver turnover which are prevalent in the industry
by seeking ways to improve the quality of life for long-haul truck drivers on
the road.

Voice communication options available to fleets and drivers are either
cellular telephones or pay telephones inside the truckstop. Cellular telephones
are currently particularly costly since these drivers are away from home and
typically incur roaming charges. Pay telephones inside the truckstop are
inconvenient, lack privacy and are not capable of handling data transmission or
Internet connectivity services. Also, drivers generally cannot receive incoming
calls at these pay telephones, making it very difficult to make contact with
their dispatchers or customers. The options available to fleets for data
communications and Internet access also are limited. While other companies
provide mobile text-messaging using satellite and cellular telephone networks,
these services are limited in capability, costly and do not allow the
transmission of large amounts of data such as bills of lading, proof of
delivery, and pay check stubs. Drivers currently send these documents back to
their fleets by regular or express mail services. Express mail services are
expensive and regular mail services are slow. Facsimile services at truckstops
are not universally available and are costly. The ability to fax or
electronically transmit bills of lading and delivery information directly to and
from the truck allows fleets to reduce their billing cycle. At the same time,
the Company's research indicates that fleets have great difficulty providing
drivers with timely payroll information which frequently results in numerous
telephone communications between drivers and fleets. The Company believes that
this can be avoided if the detailed pay information is provided directly to the
driver in his cab through the Internet or other data network. As a result of
these and other factors, the Company believes that, increasingly, the Internet
will develop into a major data communications pipeline for fleets and their
drivers.

Drivers' options for entertainment while on the road are generally limited
to community television and video game rooms at truckstops. These facilities are
typically crowded, afford drivers little programming choice or privacy, and are
uncomfortable. Drivers can purchase satellite television systems for their cabs,
however, such systems have relatively high up front costs and monthly
subscription fees.

BUSINESS STRATEGY

The Company's objective is to become the leading provider of telephony,
data, Internet and entertainment services to the long-haul trucking industry.
The Company believes that the current lack of accessible and cost effective
telecommunications and entertainment options for fleets and drivers is a
significant opportunity and that the Company is well positioned to take
advantage of this opportunity.

The Company plans to achieve its objective by:

- Continuing the build-out of the PNV Network from 118 sites as of June 30,
1998 to a total of approximately 650 truckstop sites (see "-- Network
Build-Out; Truckstop Relationships and Contracts");

30
<PAGE> 35

- Expanding its current products and services offering (see "-- Products
and Services -- Future Products and Services");

- Enhancing the PNV Network by increasing its capacity and functionality
(see "-- Network and Technology -- Proposed Enhanced PNV Network Design);
and

- Expanding its marketing and sales program to further penetrate the fleet
and individual driver segments as the number of sites at which the PNV
Network is available increases and in connection with the Company's
expansion of its products and services and enhancement of the capacity
and functionality of the PNV Network (see "-- Marketing").

PRODUCTS AND SERVICES

Current Products and Services

The Company is currently providing drivers and fleet trucking companies
with the following services over the PNV Network:

<TABLE>
<CAPTION>
TELEPHONE ACCESS INTERNET ACCESS AND DATA CABLE TELEVISION
<S> <C> <C>
- - Full landline quality and - Full landline quality and - Full access and cable quality
capability from inside the capability from inside the truck reception from inside the truck
truck cab. cab. cab.

- - Full local and long distance - Ability to use the telephone - 18 channels of programming.
calling. system to connect to the Internet
and to transmit/receive data - Pay-Per-View channel available
- - Ability to purchase incremental through a regular modem. for an incremental $5.00 per day
long distance minutes. at certain locations.

- - Ability to receive calls. - Availability of dedicated
advertising channels.
- - Location service to find
members logged on to the - The Driver Entertainment
Network. Network.

- - Voicemail.

- - Wake-up calls
</TABLE>

The following table sets forth certain information regarding prices and
services currently associated with each type of subscription offered by the
Company:

<TABLE>
<CAPTION>
"POWER PLAN" SUBSCRIPTION
(PAID FOR BY THE
FLEET SPONSORED SUBSCRIPTION INDIVIDUAL DRIVER) MONTHLY USAGE CARD DAILY USAGE CARD
<S> <C> <C> <C>
- - On-going subscription at - On-going subscription at - 30 days of usage from - 24 hours of usage from
$30 per month. $30 per month. time of first time of first
activation at $30 per activation at $5 per
- - $10 initial membership fee - $10 initial membership month. day.
waived. fee waived.
- $10 initial membership - $10 initial membership
- - Local and long distance - Local and long distance fee fee
access. access.
- Local and long - Local and long
- - 60 minutes of long - 60 minutes of long distance access. distance access.
distance included per distance included per
month with subscription. month with subscription. - 60 minutes of long - Purchased with cash at
distance included per a vending machine at the
- - One to three year - Second month of service month with truckstop.
contracts with minimum is free. subscription.
commitments. - Unlimited daily access
- Charged every month to a - Purchased with cash at to cable television
- - Billed to the fleet each credit card or checking a vending machine at services.
month. account provided by the the truckstop.
subscriber.
- - Unlimited monthly access - Unlimited monthly
to cable television - Unlimited monthly access access to cable
services to cable television television services.
services.
</TABLE>

31
<PAGE> 36

As part of a subscription, the user obtains a membership card and kit that
includes a telephone, 25 foot coaxial and telephone cable and an owner's manual
for a $10 fee (the fee is waived for fleet and Power Plan members). A subscriber
accesses the PNV Network by plugging the coaxial and telephone cable into the
Bollard at the parking stall at a truckstop. The subscriber then dials * and
logs on to the PNV Network. A computerized voice response prompts the subscriber
to enter the subscriber's membership number. If the subscriber is a daily or
monthly user, the computer prompts the user to enter the subscriber's daily or
monthly card number. If the subscriber is in good standing, service is
activated.

The Company's services currently consist of the following local and
long-distance telephone, voice messaging and cable television services:

Telephone services. Telephone service includes long distance,
incoming calls and free outside access (0+, 800 and local calls), as well
as amenities such as computerized wake-up calls. In January 1998, the
Company successfully started reselling incremental long distance minutes,
beyond the free 60 minutes per month included in the monthly subscription,
to a select group of subscribers. The promotional tests were successful. As
of February 1998, Power Plan members could purchase long distance telephone
time by charging directly to their existing accounts. By September 1998,
the Company expects that all subscribers will be able to charge the
purchase of long distance time to credit cards. By the end of 1998, the
Company plans to deploy a $20 "value card" to serve as an additional method
of payment for both long distance and other Network services, such as the
Pay-Per-View channel. The value card will be available at the vending
machine located at each truckstop. The Company is also pursuing a payment
plan that will allow fleet drivers to purchase long distance minutes for
personal use through payroll deductions.

Voice Messaging and Location Services. Voice messaging and location
determination services are provided on a no-fee basis to subscribers. These
services are keyed to the subscriber's membership number utilizing the
driver location service. If a subscriber is logged on to the PNV Network
anywhere in the country, a third party can telephone the subscriber
directly. The driver location service also is useful to fleet trucking
companies in tracking their drivers. If a subscriber is not logged onto the
PNV Network or is unavailable, the third party can leave a voice message.
Drivers can access the voice mail system and retrieve their messages from
any telephone by calling into the PNV Network.

Data Communications and Internet Access. Basic data communications
and access to the Internet are available through the use of modems. For
access to the Internet, subscribers must have an existing ISP. Subscribers
can access the ISP by calling either a local number (if their ISP has a
local number available at the location where the subscriber is) or by
calling a long distance number.

Cable Television. The basic cable television service features 18
channels, including HBO1, HBO2, HBO3, ESPN, ESPN2, The Weather Channel,
Discovery, A&E, TNN, TNT, CNN Headline News, ABC, CBS, NBC and Fox. The
Company also offers The Playboy Channel (which as of June 30, 1998 was
available at approximately 52% of the truckstops as permitted by the
truckstop owners) as a premium Pay-Per-View service for an additional
charge of $5.00 per day. As of June 30, 1998, the Company had experienced a
16% penetration rate for this service.

The Driver's Entertainment Network (DEN). The PNV Network has excess
capacity over which dedicated channels can be created so that advertisers
and others can broadcast information. In December 1997, the Company
launched the Driver's Entertainment Network (DEN), its music-based channel.
The current programming format consists of a two hour video loop. The
Company plans to gradually expand programming content to include
informational programming and other programming targeted at professional
drivers. The Company intends to market the DEN to advertisers such as
automotive products manufacturers and fleet trucking companies wishing to
use the medium for driver recruitment or education, and other companies
doing business in the trucking industry. To date the revenues generated by
the Company through sales of advertising on the DEN have been
insignificant. However, the Company believes that the DEN offers
advertisers a highly efficient medium for penetrating an otherwise
difficult to reach market segment.

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<PAGE> 37

Future Products and Services

The Company plans to substantially complete the expansion of its voice and
data communication services by increasing the network functionality and capacity
through the installation of T-1 lines and routing and switching equipment
throughout the PNV Network. Expansion of the functionality of the PNV Network
will allow the Company to offer drivers and fleet trucking companies voice and
data communications and Internet access at competitive rates. See "Risk
Factors -- Expansion of PNV Network Installation and Services; Future Revenue
Streams; Minimum Requirements Contracts; Cost-Savings."

Creation of High Capacity, Low Cost Voice and Data Network. The Company
plans to create a high capacity, low cost voice and data network which will be
established in two steps. First, the Company plans to install T-1 lines at each
truckstop which will provide for more voice and data transmission capacity
compared to the current POTS and allow for dedicated long distance and frame
relay services. Use of T-1 lines will allow the Company to (i) bypass the local
exchange carrier ("LEC") and associated LEC access charges and (ii) obtain
favorable pricing from long distance carriers, essentially creating a private
network. Secondly, the Company plans to offer this private network to major
fleet trucking companies. The Company anticipates that it will be able to
connect truckstop and certain fleet terminal locations through a frame relay
link that will allow the Company to transmit voice over IP. This will allow the
Company to offer major fleet trucking companies highly effective and competitive
pricing for voice and data communications with their drivers.

Internet Access as Internet Service Provider. Expansion of the PNV Network
to include T-1 lines and frame relay will allow the Company to become an ISP.
With the increased use of the Internet for all types of commerce, the Company
believes that Internet access will become a major data communication pipeline
for fleet trucking companies and drivers and, as a result, plans to become an
ISP. As such, providing reliable low cost access from inside the truck will be a
valuable service to the fleet trucking companies and drivers. The Company plans
to make this service available for a monthly fee.

T-1 Line Leases, Long Distance Services and Internet Access Contracts. The
Company recently entered into contracts with AT&T to lease T-1 lines and related
frame relay services and to purchase long distance, local and related voice
telephone services. The Company also recently entered into a contract with AT&T
pursuant to which it may purchase Internet access services in the future.

Pursuant to the contract for the lease of T-1 lines, the Company is
required to lease, for a three-year term beginning after the start-up period,
approximately (i) 200 T-1 lines having minimum payments, before available
discounts, of $5.1 million during the first year following the start-up period
and (ii) 300 T-1 lines having minimum payments, before available discounts, of
$7.7 million during the second and third years following the start-up period.
The start-up period ends in February 1999 or such earlier date as to which the
Company gives AT&T notice. Lease payments by the Company for T-1 lines during
the start-up period will not be counted in determining satisfaction of the
required minimum dollar amounts. Discounts are available to the Company if it
satisfies the foregoing undiscounted minimum requirements. Discounts are also
available for lease payments during the start-up period. If the Company is not
able to satisfy its minimum requirements under the contract due to lower than
expected use of T-1 lines or otherwise, then the Company is obligated to pay
AT&T the difference between the minimum requirement for the applicable period
and the lease payments related to the T-1 lines actually leased by the Company
for the applicable period, both before available discounts. AT&T has waived the
installation fee for each T-1 line, but, upon disconnection of a T-1 line, the
Company must pay such fee for any T-1 line not in service for a period of at
least 18 months. See "Risk Factors -- Expansion of PNV Network Installation and
Services; Future Revenue Streams; Minimum Requirements Contracts; Cost-Savings."

The Company may terminate the contract for the lease of T-1 lines at any
time. Upon any such termination prior to the third anniversary of the completion
of the start-up period, the Company must pay to AT&T 35% of the remaining
aggregate undiscounted required minimum lease payments. However, in the event of
a business downturn beyond the Company's control, a restructuring of the PNV
Network that results in the use of other AT&T services, or certain limited
circumstances that significantly reduce the volume of telecommunications
services required by the Company and that will make the Company unable to meet
its commitment under the contract, AT&T has agreed to cooperate with the Company
to develop a mutually

33
<PAGE> 38

agreeable alternative that will satisfy the needs of the Company and AT&T and
will comply with all applicable legal and regulatory requirements.

Pursuant to the contract for long distance and other telephone services,
the Company will purchase long distance, local (in those states where available)
and voice telephone services, including incoming toll-free 800 lines from AT&T,
for a two year term. While the total amount payable pursuant to the contract
will vary with usage, the contract requires the Company to purchase each month,
at minimum, services having an undiscounted price of $40,000 based upon standard
AT&T rates. The Company has negotiated discounts off the standard AT&T rates
based upon certain usage levels. While the Company may terminate this contract
for any reason, the Company is obligated to pay to AT&T upon termination the
remaining aggregate undiscounted required minimum amount. See "Risk
Factors -- Minimum Requirements Contracts."

Pursuant to the Internet access services contract, for a term of three
years the Company may purchase certain standard AT&T Internet access services.
No services will be provided, and the Company will have no obligation to make
payments to AT&T, unless and until the Company submits a purchase order, agreed
to by AT&T, for particular services.

NETWORK BUILD-OUT; TRUCKSTOP RELATIONSHIPS AND CONTRACTS

The Company intends to continue to install the PNV Network from 118 sites
as of June 30, 1998 to a total of approximately 650 full-service truckstop
sites. Approximately half of these locations will have an average of 100 to 150
parking stalls per truckstop and approximately half will have fewer than 100
parking stalls. In order to achieve contractual milestones, the Company will
initially focus its build program on the larger truckstops. The Company believes
that its ability to significantly increase subscription sales to drivers and
fleet trucking companies is dependent on the availability of the PNV Network at
a critical mass of truckstops so that drivers can access the PNV Network at
least seven or more times during a month. The Company currently believes that it
will achieve "critical mass," once it has installed the PNV Network at
approximately 100 to 150 additional truckstops (making the PNV Network available
at between approximately 200 and 250 sites). At such time, the Company believes
that the number of subscribers that will purchase monthly subscriptions, renewal
rates and sales to fleet trucking companies will increase substantially. The
Company believes that installations at the next 100 to 150 additional sites will
be complete by June 1999. The Company believes that the installation of the PNV
Network of approximately 650 full-service sites will not be complete until after
2001. Such installation will be subject to, among other things, the Company's
ability to satisfy significant capital requirements associated with such
installation. See "Risk Factors -- Expansion of PNV Network Installation and
Services" and "-- Future Capital Requirements; Uncertainty of Additional
Financing."

There are over 2,100 truckstops in the United States located on the
interstate highway system of which the Company believes there are approximately
1,100 full service truckstops (providing more services than just fuel). The
Company currently has long-term contracts to install the PNV Network at
approximately 751 of such truckstops. The Company has entered into these
long-term contracts pursuant to which eight of the 10 largest full-service
truckstop chains and associations in the United States, including TA Operating
Corporation, Petro Stopping Centers, Inc., Pilot Corporation, and Professional
Transportation Partners, LLC, as well as with several other associations
representing independent truckstops have agreed to permit the Company to offer
its services to their members on an exclusive basis. The Company's contracts to
install the PNV Network at approximately 338 truckstops are with associations
whose members consist of smaller truckstop chains generally having fewer than 10
truckstops. These associations act as purchasing agents for their members. The
Company entered into contracts with these associations as an efficient manner in
which to gain access to and establish a relationship with numerous small to
medium size truckstops. These associations do not have authority to legally bind
their members. Therefore, while each association has granted the Company the
exclusive right to provide cable television and telephone services to its
members, this contractual right is not binding on each member. Prior to
installation of the PNV Network at an association member's truckstop, the
Company enters into a contract with the association member granting the Company
the exclusive right to install the PNV Network at the member's truckstops.

34
<PAGE> 39

The Company has contracted with truckstop chains, independent truckstop
owners and associations of truckstop owners. While most independent truckstop
owners who own a single truckstop execute a standard contract, the contracts
executed by truckstop chains that operate multiple truckstops vary
significantly. The Company offers a standard contract to the truckstop owners
and associations generally consisting of a term ranging from five to ten years
with an automatic five year renewal. Pursuant to the terms of the standard
contract, the Company is granted the exclusive right to provide
telecommunications and entertainment services to all of the owners' truckstops
for a mutually agreed period of time which, if the Company achieves its
contractual build-out milestones, generally extend for 10 years. Two owners of a
total of less than 15 truckstops did not grant the Company the exclusive right
to install the PNV Network at all of their truckstops. The Company pays
commissions to truckstop owners/operators based upon a percentage of its
revenues less specified costs on a negotiated basis. See "Risk
Factors -- Dependence on Contractual Relationships with Truckstops" and
"Management's Discussion and Analysis of Financial Condition and Results of
Operations -- Overview."

A significant portion of the 21 or more days per month a driver spends on
the road is spent at truckstops as (i) there frequently are restrictions on the
roads and streets on which a long-haul truck can travel; (ii) many truckstops
have fueling agreements with fleet trucking companies that require refueling at
certain specified truckstops; and (iii) many full service truckstops provide a
variety of services to long-haul truck drivers, including showers, pay
telephones, television rooms and stalls for parking trucks. The Company believes
that the average truckstop represents a substantial capital investment. Despite
the amount of capital invested in the parking lot, the typical truckstop does
not generate any revenue from that asset (other than a limited number of
truckstops which charge for parking). At the same time, margins on fuel have
been under pressure, forcing truckstop operators to differentiate their
truckstops from their competitors and find other sources of revenue. The Company
believes that the PNV Network offers truckstops: (i) an amenity for long-haul
truck driver customers; (ii) a means for competitive differentiation; and (iii)
the ability to generate incremental revenue through the revenue and
profit-sharing provisions of the contracts.

The table below summarizes the Company's current contracts with truckstop
owners and operators, and truckstop associations as of June 30, 1998.

<TABLE>
<CAPTION>
TOTAL NO. OF LOCATIONS
TRUCKSTOP CHAINS AND OWNERS NO. OF LOCATIONS INSTALLED
- --------------------------- ---------------- ----------------
<S> <C> <C>
TA Operating Corporation.................................... 121 21
Pilot Corporation........................................... 119 31
Kiel Brothers Oil Co. ...................................... 2 0
Petro Stopping Centers, Inc................................. 44 6
Travelports of America, Inc................................. 16 8
All American Travel Plaza's, Inc............................ 9 5
MAPCO Marketing, Inc........................................ 3 1
Sapp Brothers Truckstops, Inc............................... 7 6
Bosselman's Travel Plazas................................... 4 3
Hamburg Enterprises, Inc.................................... 5 2
Bruce's Truckstops, Inc..................................... 4 1
Highway Service Ventures, Inc............................... 4 4
Welsh Oil, Inc.............................................. 4 4
Tewel Corporation........................................... 4 1
Smithton Interstate Corporation............................. 3 0
Stony Ridge Travel Plazas................................... 2 0
Baggett's Travel Plaza...................................... 2 1
Burns Brothers Travel Plaza................................. 18 0
Additional Owners of a Single Truckstop..................... 42 24
--- ---
Subtotal.................................................. 413 118
</TABLE>

35
<PAGE> 40

<TABLE>
<CAPTION>
TOTAL NO. OF LOCATIONS
TRUCKSTOP ASSOCIATIONS NO. OF LOCATIONS INSTALLED
- ---------------------- ---------------- ----------------
<S> <C> <C>
Professional Transportation Partners, LLC................... 127 29(1)
North American Truckstop Network, Inc....................... 109 8(1)
Ambest, Inc................................................. 102 28(1)
---
Subtotal.......................................... 338 -0-
Total............................................. 751
===
</TABLE>

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

(1) Pursuant to the Company's contract with the association, the Company has
contracted directly with the specified number of truckstop owners to install
the PNV Network. Accordingly, these truckstop association locations are also
included under the appropriate truckstop chain referenced in the section of
this table entitled "Truckstop Chains and Owners."

As of June 30, 1998, the Company was in negotiations to enter into
additional exclusive contracts with several truckstop chains and independent
owners that collectively own more than 130 truckstops.

MARKETING

The Company believes that providing a cost effective, accessible
telecommunications and entertainment network that is deployed at a large number
of truckstops throughout the country will be a valuable service to long-haul
drivers and long-haul fleet trucking companies. The Company's marketing efforts
seek to communicate appropriate elements of this value proposition to each
segment of the target market and the Company's distribution strategy is designed
to reach each segment of the market efficiently. As the functionality and size
of the PNV Network grows, the Company plans to adjust its marketing and
distribution methods to emphasize its strengths. While the Company believes that
its primary target market consists of 800,000 to 1,000,000 long-haul drivers,
the Company has divided this target market into two broad segments, individual
drivers and fleet trucking companies. The fleet segment is further divided into
three segments based on fleet size. The Companies marketing strategies to each
segment of the target market are as follows.

Marketing to Fleets. The Company believes that as the functionality and
size of the PNV Network expands, selling to medium and large fleet trucking
companies will increasingly become the most efficient means to add new
subscribers and to increase revenues from new services as they come on line. In
selling to fleet trucking companies, the Company plans to negotiate for
contracts of at least one year in length containing minimum subscription
commitments. The Company has successfully used this model and recently entered
into contracts with five fleet trucking companies that have committed to a
minimum of 2,329 drivers for terms ranging from one to three years, subject to
certain earlier termination rights. See "Risk Factors -- Ability to Sustain and
Increase Subscription Sales; Retention."

LARGE FLEETS (OVER 1,000 TRUCKS). Company research indicates that there
are approximately 50 fleet trucking companies in this segment that operate, in
the aggregate, 140,000 trucks. The marketing message to this segment is based on
long-term partnerships and the fact that the Company is developing a
telecommunications network designed to meet the needs of the fleet.
Specifically, improvement in driver retention by enhancing drivers' on-road
lifestyle with in-cab voice, data and cable entertainment, as well as telephone
access inside the truck cab to reach the driver efficiently and effectively, are
identified as immediate benefits to the fleet. Equal weight is given to the
future expansion and capability of the enhanced PNV Network. The potential for
building high capacity, low cost voice and data links between fleet centers and
a large number of truckstops is highlighted, as well as the fact that this
network is also a viable gateway onto the Internet from inside the truck. The
distribution method for reaching this segment involves multi-level selling and
relationship building at various organizational levels of the fleet trucking
company account. A senior-level major account representative coordinates sales
efforts. The Company currently has one such person on staff. The Company's
senior management, including the President and COO, are also actively involved
in contacting their counterparts at the target account. One of the Company's
five fleet contracts is with a large fleet.

MEDIUM SIZE FLEETS (100 TO 1,000 TRUCKS). Company research indicates that
there are approximately 892 fleet trucking companies in this segment who
operate, in the aggregate, over 212,000 trucks. The

36
<PAGE> 41

marketing message to this segment is the same as to large fleet trucking
companies and is aimed at senior management and/or owners. Commercial sales
representatives are the primary channel for reaching this segment. The Company
currently has three such representatives on staff. The Company also may contract
with independent sales agents to sell to this segment. Company representatives
are compensated with a base salary plus commissions based on sales performance.
Independent representatives will be compensated on a commission basis. Four of
the Company's five fleet contracts are with medium size fleets.

SMALL FLEETS (UNDER 100 TRUCKS). Company research indicates that there are
over 18,000 fleet trucking companies in this segment who operate, in the
aggregate, over 280,000 trucks. This segment represents a very large but highly
fragmented sector of the target market. The marketing message to this segment is
aimed at the owner of the business. The primary distribution channel for
reaching this segment will be telemarketing and direct mail. The Company
believes that this segment is too fragmented and each individual company is too
small to warrant sales representative salaries and travel costs. Telemarketing
leads will be generated through contact lists of targets in this segment,
working with independent telemarketers who have had prior experience selling
communication and technology services into the trucking and trade advertising
markets.

Marketing to Individual Drivers. The key marketing message to this segment
of the market is the benefits of telecommunications and cable television service
in the privacy and comfort of the truck cab at a very low cost. For
approximately $1 per day, typically significantly cheaper than the cost at home
for cable and telephone, a driver can obtain telecommunications and cable
television service while parked at a truckstop. The distribution channels for
reaching this segment are: (i) vending machines at the truckstops which dispense
daily and monthly memberships; (ii) field sales representatives at the larger
stops who sell Power Plan subscriptions; and (iii) telemarketing representatives
who sell Power Plan memberships to potential subscribers who call in to the
numbers provided on brochures and other advertising materials. The field sales
organization has three objectives: (i) generate Power Plan and machine sales;
(ii) maintain strong relationships with local truckstop personnel; and (iii)
ensure the PNV Network is fully operational at each truckstop.

As a result of its marketing programs to date, the Company believes that
the best method of advertising to truck drivers is at the truckstop through
point of sale merchandising, signage, brochures and similar materials. The
Company has developed extensive materials to support this program and has
successfully deployed it in the field. Call volume into the telemarketing center
has increased and was over 1,800 calls during the first quarter of 1998. The
Company is also working with truckstop operators, particularly the large
national chains, to institute standardized merchandising programs including
incentives for truckstop employees to sell Power Plan subscriptions or to direct
potential customers to telemarketing.

Field Sales Force. The field sales organization consists of Regional
Managers (RM) that oversee the Eastern and Western areas, Area Sales Managers
(ASM) and site representatives that report to the ASM at select truckstops. As
of June 30, 1998, the Company has two RMs, 12 ASMs and approximately 68 sales
representatives. Each RM has overall sales and maintenance responsibility for
approximately 50 locations. The ASM's operate as area general managers, leading
site representatives who are responsible for generating sales and helping to
maintain strong truckstop relationships, and a technical support person that
makes sure that the PNV Network is fully operational. Sales representatives are
deployed at large high traffic truckstops to directly sell Power Plan
subscriptions. They strategically set up a podium at the truckstop with
prominent Company signage and market and sell to drivers as they pass from the
lot into the truckstop. The sales representatives report to an ASM who generally
has control over eight to ten locations. The ASM has overall responsibility for
ensuring that all sites under their control are properly manned and have proper
sales and marketing material. Each ASM also has responsibility for ensuring
technical maintenance of the PNV Network at their sites. A maintenance person is
assigned to each ASM and travels with them to each site to perform routine
inspections and repairs. Sales representatives and ASMs are compensated with a
base salary plus commissions for sales. The Company plans to hire additional
RMs, ASMs and sales representatives as the size of the PNV Network grows.

Telemarketing. The Company currently uses telemarketing to sell on-going
Power Plan subscriptions. Leads for telemarketing are generated through
advertising in trade magazines, sales materials distributed at

37
<PAGE> 42

the truckstops and through an upselling program aimed at current monthly/daily
users. As part of the upselling program, monthly/daily users are diverted to a
telemarketing representative when they log on to the network. The representative
welcomes them to the PNV Network and attempts to upsell them to Power Plan. The
Company plans to expand its telemarketing effort to small fleet trucking
companies. Leads will be generated through direct mail campaigns and trade
advertising. As part of its efforts, the Company may utilize independent agents
who have had prior experience selling communications and technology services
into the trucking and trade advertising markets.

Voice Response Unit. The Company believes that the voice response unit,
which all users interact with when they log on to the PNV Network, is a highly
effective marketing tool. When a user logs on the PNV Network, an audio message
is played that informs the user of options to purchase long distance services.
Users will hear a message every time they activate service. The Company has
complete flexibility in targeting specific messages to selected groups of users.
For example, a subset of all subscribers can be targeted for a campaign to
market a high usage long distance package and a special message can be played
only for that group. This model has already been successfully used to sell long
distance minutes to Power Plan subscribers.

Driver Referral Programs. The Company believes that word of mouth is a
major element in increasing product awareness among drivers. The Company
recently launched a driver referral program that awards 60 minutes of long
distance to existing subscribers who refer a friend or colleague who signs up
for the Power Plan. The Company plans to run various programs and contests that
reward referrals by drivers.

NETWORK AND TECHNOLOGY

Current PNV Network Design. The current architecture of the PNV Network
consists of a Site Server at each truckstop connected to the Host Server. The
Site Server controls and manages all interaction with the subscriber, telephone
communications, cable television activation and communications with the Host
Server. The following diagram depicts the current architecture of the PNV
Network:

CURRENT SYSTEM ARCHITECTURE

[There appears here a diagram depicting the current architecture of the PNV
Network. The diagram depicts lines drawn from an irregularly shaped box
containing the letters "PSTN": (1) to the left to an illustration labeled "Host
Server" and to a second illustration labeled "VoiceMail/Driver Tracking Server,"
each of which is contained in a rectangle labeled "Park 'N View Headquarters,"
(2) to the right to an illustration labeled "PBX" which is contained in a
rectangle labeled "Fleet Headquarters," and (3) down to an illustration labeled
"Site Server" and to a second illustration labeled "Authorization Modem," each
of which is contained in a rectangle labeled "Truckstop." In the rectangle
labeled "Truckstop," there are lines drawn to the left from the illustration
labeled "Site Server" to a rectangle labeled "66 Block," from which there is a
line drawn to the left to a rectangle labeled "PED Box." There also are lines
drawn up from the illustration labeled "Site Server" to an illustration labeled
"Authorization Modem" and to the right to an illustration labeled "Video Control
Unit." The illustration labeled "Video Control Unit" also is connected by a line
to the left to a rectangle labeled "PED Box" and by a line to the right to an
illustration labeled "Modulators." The illustration labeled "Modulators" is
connected by a line to the left to a rectangle labeled "PED Box" and by a line
up to an illustration labeled "Receivers," which is in turn connected by a line
up to an illustration labeled "Digital Satellite Dish." There also are two lines
to the left from the rectangle labeled "PED Box" to a semicircular illustration
labeled "Bollard," which is connected by four lines to a rectangle labeled
"Driver Truck Cab." The rectangle labeled "Driver Truck Cab" includes the words
"Telephone," "Laptop Computer," "Fax," and "TV," each with an appropriate
illustration.]

The current architecture of the various components of the PNV Network and
related services are described below.

PC Based Communications Server. The Site Server located at each truckstop
is both the controlling computer and intelligent private branch exchange (PBX).
Using off-the-shelf telephony boards, each telephone extension and outside
telephone line is connected and controlled by the Site Server. Although the

38
<PAGE> 43

hardware architecture utilizes off the shelf components, the real power of the
system comes from the PNV Software, which controls all aspects of user
interaction. Unlike a standard PBX, once a user picks up their telephone, all
interaction with the user is controlled by the PNV Software which is more fully
described below.

Host Server. The Host Server located in Coral Springs, Florida maintains
control of all membership information and determines individual membership
privileges. The Site Server communicates by dial-up modem to the Host Server
each time a member attempts to log on to or log off of the PNV Network. The
membership number is checked in the database and specific information about the
user such as their membership expiration date, number of long distance minutes
available and voice mail messages is downloaded to the Site Server for
subsequent interaction with and access by the user.

Proprietary Software. The PNV Software was developed in-house by the
Company and performs numerous functions including: (i) subscriber log on entry;
(ii) subscriber log on host server validation; (iii) membership information
maintenance, including membership cards and renewal card tracking; (iv) log on
information communicated to subscribers such as expiration date, stall number,
and call back number; (v) wake-up call notification; (vi) cable television
system control including activation of standard cable and activation of premium
channels; (vii) outbound call control and tracking; (viii) least cost call
routing; (ix) prepaid long distance call control and tracking including account
balance maintenance; (x) extension to extension call control and tracking; (xi)
call detail record storage and reporting; (xii) inbound call control and
tracking; (xiii) subscriber location tracking and voice mail services; (xiv)
subscriber voice messaging with broadcast capability; and (xv) stall maintenance
tracking. Unlike a standard PBX system with computer interfaces, all aspects of
the PNV Network are programmable, allowing for full upgradability and
flexibility as new capabilities are needed or made available in the future.

Telephone Wiring. The telephone jack in each Bollard connects by twisted
pair wiring to a pedestal box ("PED Box") that in turn is connected to the
telephone switch and Site Server inside the truckstop. The Site Server is
connected via trunk interface cards to the Public Switched Telephone Network
(PSTN) through POTS lines. These POTS lines are used to connect all local and
long distance calls. Although there is no limit on the number of extension to
extension calls within the truckstop, the number of outside calls is limited to
the number of POTS lines available at each site which currently averages 12 per
truckstop. Additional POTS lines can be added to meet telephone usage demand at
a particular truckstop.

Billable Long Distance Call Management. Unlike prepaid long distance card
companies, the Company has the advantage of having an intelligent switch
controlling each call at the place of origination and can thereby reduce their
cost per call. Prepaid calling card vendors require the user to dial an 800
number, enter their card and access numbers and then dial the number they wish
to dial. Thus, they are actually making two calls each time. An inbound call to
the calling switch and then an outbound call from the calling switch to the
applicable number. All completed calls have double costs associated with them.
If all calls are busy or not answered, the calling card company must absorb the
costs of the inbound call.

The Company believes that its long distance service uses a unique approach
by having the equivalent of a prepaid calling card switch at each site. All call
management functions including adding new minutes, deducting minutes for each
call and terminating a call when all minutes have been used are performed by the
Site Server. Since call management is performed locally at each site, the user
can simply make long distance calls by dialing 9,1 + number. The call is
originated from the truckstop directly to the applicable number as a single
call. Therefore, if there is no answer or the line is busy, the user is not
billed and the Company does not incur the cost of an incoming call. This feature
greatly reduces the cost per call for the Company as compared to other prepaid
calling card vendors.

Cable Television Wiring. The television plug-in terminal in each Bollard
is connected through a single coaxial cable to the PED Box. The PED Box is
connected through a single coaxial cable to the cable head end system inside the
truckstop.

Cable Television Head End and Wiring. The cable head end system is
comprised of a satellite dish connected to an individual receiver. Other
conventional methods of Off-Air antennas and C-Band technolo-

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<PAGE> 44

gies are also used in supplying channels to the user. An encrypted control unit
is used to control which users have access to Pay-Per-View services.

Proposed Enhanced PNV Network Design. Following the completion of the Unit
Offering, the Company plans to significantly enhance the functionality and
capacity of the PNV Network by the second half of 1999 to expand the scope of
services offered and reduce operational costs. See "Risk Factors -- Expansion of
PNV Network Installation and Services" and "-- Future Revenue Streams;
Cost-Savings." In connection with these enhancements, although the basic
architecture currently in place will remain the same, certain additional
components will be added. The following diagram depicts the proposed enhanced
PNV Network:

PROPOSED SYSTEM ARCHITECTURE

[There appears here a diagram depicting the proposed architecture of the
PNV Network. In the top center of the diagram is the word "Internet" in an
irregularly shaped box connected by a line labeled "Gateway" to an irregularly
shaped box labeled "Frame Relay Network," which has three lines from it, each
going to a different rectangle labeled "IXC." Each of the three rectangles
labeled "IXC" is connected to an irregularly shaped box labeled "PSTN." The
rectangle labeled "IXC" that appears at the left is connected by a line to the
left to an illustration labeled "DSU/Router/VOIP," which appears in a rectangle
labeled "Park 'N View Headquarters." The rectangle labeled "IXC" that appears at
the right is connected by a line to the right labeled "T-1" to an illustration
labeled "DSU/Router/Modems/VOIP," which appears in a rectangle labeled "Fleet
Headquarters." The rectangle labeled "IXC" at the bottom is connected by a line
down labeled "T-1" to an illustration labeled "DSU/Router/Modems/VOIP" in a
rectangle labeled "Truckstop." In the rectangle labeled "Park 'N View
Headquarters," the illustration labeled "DSU/Router/VOIP" is connected by a line
to the left to an illustration labeled "Host Server" and by a second line to the
left to an illustration labeled "Voice Mail/Driver Tracking Server." In the
rectangle labeled "Fleet Headquarters," the illustration labeled
"DSU/Router/Modems/VOIP" is connected by a line to the right to an illustration
labeled "PC Based Communications Server," which is then connected by a line up
to an illustration labeled "PBX." In the rectangle labeled "Truckstop," there is
a line from the illustration labeled "DSU/Router/Modems/VOIP" down to an
illustration labeled "Site Server." There are lines drawn to the left from the
illustration labeled "Site Server" to a rectangle labeled "66 Block," from which
there is a line drawn to the left to a rectangle labeled "PED Box." There also
is a line drawn to the right from the illustration labeled "Site Server" to an
illustration labeled "Video Control Unit." The illustration labeled "Video
Control Unit" also is connected by a line to the left to a rectangle labeled
"PED Box" and by a line to the right to an illustration labeled "Modulators."
The illustration labeled "Modulators" is connected by a line to the left to a
rectangle labeled "PED Box" and by a line up to an illustration labeled
"Receivers," which is in turn connected by a line up to an illustration labeled
"Digital Satellite Dish." There also are two lines to the left from the
rectangle labeled "PED Box" to a semicircular illustration labeled "Bollard,"
which is connected by four lines to a rectangle labeled "Driver Truck Cab." The
rectangle labeled "Driver Truck Cab" includes the words "Telephone," "Laptop
Computer," "Fax," and "TV," each with an appropriate illustration.]

The planned architecture of the additional components of the enhanced PNV
Network and related services are described below.

Dedicated T-1 Access at Truckstop. The planned addition of a T-1 line at
each truckstop affords additional telecommunications capacity and reduced
operational costs. Each T-1 line offers 24 channels of long distance voice or
data capability at a fixed cost. All 24 channels can be designated as voice
channels for a flat monthly fee. Any number of the 24 channels can be designated
for data at an additional cost. The ability to designate between voice or data
channels allows flexibility as requirements change.

Dedicated Long Distance Access at Truckstops. Dedicated long-distance
service offers distinct advantages over existing switched services. First, the
cost of long distance minutes will be reduced from current rates because a
dedicated T-1 bypasses the LEC and the associated LEC access charges. In
addition, the Company believes that it will be able to obtain more favorable
pricing available from long distance carriers. This more favorable pricing is
only available when either the originating or terminating numbers have dedicated
T-1

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<PAGE> 45

access from the carrier. Finally, transmission of long distance calls over the
T-1 reduces the need for POTS lines and therefore reduces costs per site.

Frame Relay Network. The Company plans to connect each truckstop via frame
relay in a hub and spoke configuration and to increase the bandwidth to each
truckstop as traffic warrants. Although frame relay will be the transport
method, the Company currently expects that the network protocol will be Transmit
Control Protocol/Internet Protocol. The Company plans to replace the current
dial-up access to the Host Server with real-time transactions over the PNV
Network. This will speed up user access to the system and greatly increase
system flexibility. Additionally, the Company plans to perform site system
monitoring and remote access over the frame network, greatly enhancing site
manageability.

Dedicated Long Distance and Data Transmission to Fleets. The Company plans
to offer installation of network nodes at select large fleet locations. These
network nodes will consist of a frame relay connection to a communication server
developed by the Company. The communication server will in turn connect to the
fleet's PBX. When a driver calls their fleet from any telephone connected to the
PNV Network, the driver will simply enter a four-digit extension. The system
will route the call to the fleet PBX and it will be like any other incoming
call. Additionally, if the fleet wishes to contact a driver, the fleet can
simply call an extension that connects to the Site Server and enter the drivers
membership number. If the driver is currently logged on to the PNV Network, the
call will be routed over the frame network to the drivers personal telephone in
their cab. If they are not connected to the PNV Network at that time, the fleet
can leave a voice mail message.

Internet Access. As part of the Company's plan to become an ISP, the
Company intends to equip each truckstop with a modem bank for locally
terminating Internet access calls. This will give the Company the ability to
offer local Internet access at all truckstops. Once a user connects to a local
modem, the data will travel over the frame relay network and then to the
Internet. The Company expects that this feature will generate additional
revenues through monthly fees and reduce operational costs if the Company
succeeds in its plan to become an ISP. Since connections between the member and
the on site modems are via the local wiring, no POTS lines will be used. The
user only ties up bandwidth on the frame network when active. Idle users have no
effect on the frame network bandwidth.

Voice Over IP. The Company intends to equip each site additionally with a
voice compression/decompression capability allowing the transfer of point to
point voice calls over the frame relay network. The Company intends to use
industry standard voice compression allowing near toll quality voice to travel
over the network. The Company plans to initially use this system for calls
between truckstops and the Company's offices, as well as for log-on and voice
response units. Subscriber service calls will transfer over the data network and
calls to drivers from the voice mail/driver locator system will be routed
directly to the drivers telephone rather than the user having to hang up and
dial the callback number. The advantage of this type of call is that the cost of
usage is flat. The existing data network carries the call as additional traffic
on the network. If network bandwidth is unavailable at the time, such as during
peak hours, the call can be routed as a voice call over the T-1. This allows the
Company the ability to build network capacity based on normal usage patterns
instead of over-engineering capacity to handle peak times.

Access Telephones Inside Truckstop. To offer greater access to the PNV
Network, the Company intends to install telephones inside the truckstop at
certain locations that are connected to the PNV Network. Most drivers stop
several times a day, but may only be off the road an hour each time. This hour
is spent inside the truckstop at the restaurant or other areas. Therefore, to
allow members to use the PNV Network as often as possible, the Company plans to
install member-only telephones, both wired and 900 MHz wireless, throughout the
inside of the truckstop. The member would simply log on to the PNV Network via
these telephones just like the telephone in the cab. All calling features will
be available, including local calls, 800 calls, billable fleet calls, billable
personal long distance calls and inbound calls.

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<PAGE> 46

COMPETITION

General

The Company believes competitive entry in its target market is already
difficult and will become even more difficult as the Company: (i) enters into
additional exclusive long-term contracts with truckstop owners and operators;
(ii) builds out additional sites; and (iii) increases its market penetration and
signs additional fleets to contracts. The Company believes that deploying an
integrated voice, data, Internet and cable network designed to address the needs
of the long-haul trucking industry will be difficult to duplicate and will place
the Company in a position to become the leading provider of voice, data,
Internet and entertainment access to the long-haul trucking industry.

Telecommunications

In the voice and data communication arena, the Company competes with
various elements of other providers' offerings based on ease of access,
functionality and cost. The Company's competitive advantage with respect to each
provider varies and is outlined below.

Public pay telephones. The Company believes that drivers currently use pay
telephones located at truckstops for a significant number of the calls they
make. The Company believes that the ability to offer telephone access at a
comparable cost to pay telephones in the privacy and convenience of the truck
cab is a significant competitive advantage when compared to public pay telephone
access which is generally in an environment that lacks privacy, consistent
availability, Internet and data connectivity or a means to receive calls.

Cellular telephones. The Company believes that it can successfully compete
with cellular telephones. Cellular service is not always available in more
remote truckstop locations. Even when cellular service is available at a
truckstop, the Company's in-cab access provides comparable convenience and more
robust functionality at a much lower cost and higher sound quality. Cellular
telephones are expensive to use for drivers, particularly due to the roaming
charges that drivers usually incur when they are away from home and with higher
cost per minute charges than either pay telephones or the Company's service.
Also, cellular telephones have limited data transmission capability and are not
cost efficient for transmission of large volumes of data. The Company
understands that one company, HighwayMaster, resells cellular telephone service
to provide both voice and data communication to the cab. According to
HighwayMaster's Annual Report on Form 10-K for the year ended December 31, 1997,
approximately 33,000 units were installed and each unit requires an initial
payment of approximately $1,995 and costs $41 per month plus $0.53 per minute
for voice and $0.48 per minute for data to operate. The Company believes that
one of the fleets with which it has a contract utilizes the HighwayMaster
service as well as the PNV Network.

Long distance service cards, pre-paid cards, and toll free numbers. The
Company's long distance services compete with providers of long distance cards
and pre-paid cards such as AT&T and MCI. The Company believes that it currently
sells long distance telephone time to individual drivers at competitive rates.
The Company also competes with providers of toll free (800 and 888) numbers that
fleets or even individuals use to call fleet headquarters or home. The Company
believes that it can successfully compete with these providers since its
dedicated long distance T-1 network will allow very competitive rates to both
fleets and drivers. The Company believes that by: (i) providing competitive
rates; (ii) allowing purchases through the voice response unit in the truck; and
(iii) providing multiple payment options, the Company can increase the amount of
long distance services sold. The Company has already successfully sold long
distance minutes to a select group of Power Plan members.

Qualcomm OmniTRACS. Qualcomm's OmniTRACS service, a satellite based
system, is used primarily for mobile vehicle location and two-way text
messaging. Based on publicly available data, the OmniTRACS service has an
installed base of approximately 210,000 units in 32 countries worldwide, of
which the Company believes that over 150,000 units are installed in the United
States. This service addresses the trucking fleets' need for real-time mobile
text communication. The Company believes that the PNV Network and OmniTRACS
service are complementary to each other. The Company believes that Qualcomm's

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<PAGE> 47

subscribers may find it cost efficient to also subscribe to the PNV Network to:
(i) transmit certain large amounts of data over the PNV Network rather than
transmitting all data by satellite over the Qualcomm service, (ii) have Internet
access, and (iii) have personal communication capabilities. The Company believes
that one of the fleets with which it has a contract utilizes the OmniTRACS
service as well as the PNV Network.

Internet/e-mail kiosks inside the truckstop. The Company believes that
there is a company that has begun installing Internet/e-mail kiosks in
truckstops. The Company believes that these kiosks do not pose a significant
competitive threat since they will operate in the same fashion as pay telephones
with limitations in privacy, availability, and convenience. The Company believes
that this company is in the early start-up phase of its business. The Company
believes that it can compete effectively with this service based on its
capability to provide Internet access in the privacy of the truck cab at
competitive rates. The Company believes that currently there are no other viable
options available that provide Internet connectivity from the truck cab.

Entertainment

With respect to entertainment, the Company's competition currently consists
of entertainment alternatives located outside the truck cab and primarily in the
truckstop. The Company's competitive position with respect to existing and
potential entertainment alternatives is outlined below.

Televisions and game rooms inside the truckstop. Community television and
game rooms inside the truckstop are the most readily available entertainment
alternatives for long-haul truck drivers. These rooms offer no privacy and
limited choice in programming and are typically crowded and smoke-filled. The
Company believes that it can successfully compete against this alternative by
offering full cable television programming in the privacy and comfort of the
cab.

Satellite dishes. A small number of professional truck drivers have
purchased direct broadcast satellite dishes to receive television programming in
their cab. Satellite dishes have high up-front costs (approximately
$200 -- $700) and monthly usage fees of approximately $30 per month. They are
awkward to use in the long-haul trucking environment since the driver must
remount and realign the dish every time the driver parks. The Company believes
that the sensitive electronics within the equipment also may not survive long in
the high-vibration environment of a moving truck and the truck's engine is
usually running even in the parking lot, so the dish may vibrate which could
inhibit high-quality reception. The Company believes that it can successfully
compete with satellite dishes since its bundled services include
telecommunications service in addition to cable television programming for a
comparable price and since the Company's service is easier to use and more
reliable.

Local cable television operators. The Company does not view local cable
television operators as a likely source of competition due to: (i) federal and
local regulations on uniform programming and pricing within franchise areas; and
(ii) programming agreements that commonly prohibit resale. Cable providers to
such users as residential apartment buildings could seek to compete by offering
these services to truckstops; however, the Company believes these operators are
unlikely to have the capital or experience to compete nationwide or offer the
range of services provided by the Company.

REGULATORY MATTERS

The FCC and relevant state regulatory authorities ("PSC's") have the
authority to regulate interstate and intrastate telephone rates, respectively,
ownership of transmission facilities and the terms and conditions under which
certain of the Company's telephone service offerings are provided. Federal and
state regulations and regulatory trends have had, and in the future are likely
to have, both positive and negative effects on the Company and its ability to
compete. In general, neither the FCC nor the relevant state PSC's currently
regulate the Company's domestic long distance rates or profit levels, although
either or both may do so in the future. There can be no assurance that changes
in current or future federal or State regulations or future judicial changes
would not have a material adverse effect on the Company's business, financial
condition or results of operations.

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<PAGE> 48

Federal laws and FCC regulations apply to interstate telecommunications
(including international telecommunications that originate or terminate in the
United States), while particular state regulatory authorities have jurisdiction
over telecommunications originating and terminating within the state.

The FCC may regulate the Company's current telephone service offerings as a
non-dominant carrier with respect to both its international and domestic
interstate long distance services, unless the Company is deemed to be an agent
or private network operator, and not a common carrier. In the domestic, as
distinguished from the international sector, the FCC abstains from closely
regulating the services and charges of non-dominant carriers. Nevertheless, the
FCC acts upon complaints against such carriers for failure to comply with
statutory obligations or with the FCC's rules, regulations and policies. The FCC
also has the power to impose more stringent regulatory requirements on the
Company and to change its regulatory classification. In the current regulatory
atmosphere, the Company believes that the FCC is unlikely to do so with respect
to the Company's international or domestic interstate service offerings.

The Company, as a non-dominant carrier, has "blanket" authority to enter
the domestic long-distance market without prior FCC approval, but must obtain
specific authority to enter the international market. In addition, the Company
is required to file with the FCC domestic and international tariffs containing
charges and related practices, regulations and classifications. The FCC presumes
the tariffs of non-dominant carriers to be lawful. The FCC could, however,
investigate the Company's tariffs, upon its own motion or upon complaint by a
member of the public. As a result of any such investigation, the FCC could order
the company to revise its tariffs, or the FCC could prescribe revised tariffs.
With respect to domestic long-distance services provided by the FCC has ordered
non-dominant carriers to withdraw their tariffs, but that order has been stayed
pending review by a court of appeals.

The intrastate operations of the Company may be subject to various state
laws and regulations. Most states require the Company to apply for certification
to provide intrastate telecommunications services, operator services, payphones
or competitive local exchange services or to register or be found exempt from
regulation, before commencing intrastate services. Most states also require the
Company to file and maintain detailed tariffs listing their rates for intrastate
service. Many states also impose various reporting requirements and/or require
prior approval for transfers of control of certified carriers, assignment of
carrier assets, including customer bases, carrier stock offerings, incurrence by
carriers of significant debt obligations and acquisitions of telecommunications
operations. Other regulatory requirements may mandate that the Company permit
resale of its services by other companies, make payments to intrastate universal
service and similar funds, and take certain steps to protect consumers.
Certificates of authority can generally be conditioned, modified, canceled,
terminated and revoked by state regulatory authorities for failure to comply
with state law and/or rules, regulations and policies of the state regulatory
authorities. Fines and other penalties also may be imposed for such violations.

In the future, when the enhanced PNV Network is fully deployed, the Company
may decide that it would be advantageous to have the status of a competitive
local exchange carrier (CLEC) in some or all of the states

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<PAGE> 49

in which it operates, or some states may require the Company to register or seek
certification as a CLEC. Current regulation provides CLECs with certain
benefits, such as the right to interconnect with incumbent LECs (ILECs) on just,
reasonable and non-discriminatory terms, access to the unbundled network
elements of ILECs at cost-based rates, and the ability to purchase (for resale)
the ILECs' retail telecommunications services at a significant wholesale
discount (determined by the state PSCs). CLECs are also subject to certain
regulatory obligations, which differ by state, but which include the obligations
to interconnect with and permit resale of their services by other
telecommunications carriers, to provide access to their poles, ducts, conduits
and rights-of-way to competing service providers, and to provide number
portability so customers may switch their LEC without changing their telephone
number.

Various state and federal regulatory factors may have an impact on the
Company's ability to attract customers. Many of the rights and obligations
created by statute and regulation are subject to ongoing regulatory
implementation proceedings and review by the courts, and are subject to change.
Changes to some regulations could benefit the Company, while other changes could
make it more difficult for the Company to compete.

PROPRIETARY RIGHTS

The Company believes that recognition of its products and services is an
important competitive factor in its industry. Accordingly, it promotes (or
intends to promote) the following in connection with its marketing activities
and holds or has filed an application for a United States trademark registration
for the following: "PARK 'N VIEW," "INCAB PNV," "PNV USA," "YOUR CAB. YOUR
CABLE. YOUR CALL," "PARK 'N VIEW" (with design), "DEN" (with design), and "WHERE
SMART DRIVERS STAY CONNECTED."

The Company regards the PNV Software as proprietary and attempts to protect
it as a trade secret. The Company holds no patents or copyrights on its software
technology.

EMPLOYEES

As of June 30, 1998, the Company had 189 employees, including 15 part-time
employees, none of whom are represented by a collective bargaining agreement.
The Company considers its employee relations to be good.

PROPERTIES

The Company is headquartered in Coral Springs, Florida, where it leases an
approximately 21,000 square foot facility in which its administrative offices
and warehouse facility are located. The Company currently leases an
approximately 11,650 square foot facility in Ft. Lauderdale which previously
served as its headquarters and warehouse facilities prior to moving to Coral
Springs. The Company has sublet the Ft. Lauderdale facility.

LEGAL MATTERS

In July 1998, Lorenzo and Pat Ortiz instituted an action against a
truckstop chain, as well as a contractor utilized by the Company in connection
with the installation of the PNV Network at a truckstop owned by the chain, in
the 11th Judicial District, Webb County, Texas, seeking unspecified actual and
punitive damages allegedly resulting from an injury suffered by Mr. Ortiz at
such truckstop in connection with such installation. Although the Company is not
currently named as a party to this action, pursuant to the contract between the
Company and the truckstop chain defendant, the Company agreed, among other
things, to indemnify the truckstop chain for claims relating to the
installation, operation or repair of the PNV Network. Further, pursuant to such
contract, the Company and the truckstop chain each agreed to maintain at least
$1,000,000

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<PAGE> 50

of liability insurance on each truckstop at which the PNV Network is available
and the Company agreed to name the truckstop chain as an additional insured on
its insurance policy. Similar indemnification and insurance maintenance
provisions are included in the standard contract between the Company and other
truckstop owners/operators as well as the independent contractors that Company
hires to install the PNV Network. The Company inadvertently failed to timely
name the truckstop chain defendant as an additional insured with the result that
the Company's commercial general liability insurance carrier has denied coverage
with respect to this action. The Company and the truckstop chain have agreed
that the Company shall assume the defense of this action, agree to indemnify the
truckstop chain from any and all losses or expenses relating to the action and
provide the truckstop chain with a letter of credit or surety bond in the amount
of $200,000 securing such indemnity.

In addition, the Company is currently a defendant in a lawsuit in Lake
County, Indiana, for actual damages relating to a slip and fall incident at a
truckstop at which the PNV Network is available. The Company's commercial
general liability insurance carrier has also denied coverage with respect to
both this lawsuit due to the Company's alleged failure to notify the carrier of
the incident on a timely basis. The Company is in the process of investigating
the denial of coverage. The Company's present understandings of both actions is
preliminary. Based such understandings, however, management does not believe
that the outcome of either such action will have a material adverse effect on
the Company's financial condition or results of operations.

The Company has received a demand that it pay $50,000 to reimburse a
worker's compensation insurance carrier for amounts paid to one or its insured
relating to injuries allegedly related to the PNV Network. The Company is in the
preliminary stages of investigating this claim. The Company has also received
notice from truckstop owners/operators of 12 to 15 slip and fall incidents
relating to the PNV Network. It has advised its insurance carrier of these
incidents and the carrier has denied coverage on several of these incidents. The
Company has not yet received notice of any claims relating to these incidents.

The Company anticipates that it will be, from time to time, subject to
claims and suits for personal injury arising in the ordinary course of its
business. Management anticipates that such claims and suits, to the extent for
actual damages, will generally be covered by insurance.

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<PAGE> 51

MANAGEMENT

EXECUTIVE OFFICERS AND DIRECTORS

The following table sets forth certain information regarding the executive
officers and directors of the Company.

<TABLE>
<CAPTION>
NAME AGE POSITIONS WITH THE COMPANY
- ---- --- --------------------------
<S> <C> <C>
Ian Williams............................... 48 Chairman of the Board, Chief Executive Officer
and Director
Stephen L. Conkling........................ 53 President and Chief Operating Officer
R. Michael Brewer.......................... 55 Vice President-Finance and Chief Financial
Officer
Anthony W. Allen........................... 37 Vice President-Operations and Secretary
Richard K. Brenner......................... 44 Vice President-Sales
Bill J. Buzbee............................. 53 Vice President-Business Development
A. Alexander Ezazi......................... 37 Vice President-Marketing
James D. Green............................. 39 Vice President-Product Development
Ralph A. Head.............................. 51 Vice President-Fleet Sales
Yves Roland Maynard........................ 37 Vice President-Engineering
Robert M. Chefitz.......................... 38 Director
Thomas P. Hirschfeld....................... 35 Director
Richard M. Johnston........................ 63 Director
Daniel K. O'Connell........................ 69 Director
David C. Turner............................ 48 Director
</TABLE>

IAN WILLIAMS, a founder of the Company, has served as Chairman of the Board
since August 1998 and as Chief Executive Officer and a director of the Company
since the Company's incorporation in September 1995. From September 1995 to July
1998, Mr. Williams served as the Company's President. From 1993 to 1995, Mr.
Williams served as President of Park 'N View, Ltd., the predecessor of the
Company. The Company intends to hire a Chief Financial Officer as soon as
practicable, at which time Mr. Conkling will assume the office of President of
the Company and Mr. Williams will thereafter serve as Chairman of the Board and
Chief Executive Officer of the Company. Prior to joining Park 'N View, Ltd.,
from 1991 to March 1993, Mr. Williams served as President of Arden Technologies,
Inc., a manufacturer and distributor of wireless cable transmitters. Mr.
Williams' experience at Arden as well as other previous employment includes the
design of numerous satellite master antenna television systems, multi-channel
low-power television systems, FM rebroadcast and distribution systems and
wireless television broadcast systems and the installation of low-power
television and cable systems throughout Canada and the Arctic, as well as over
thirty other countries throughout the world. Mr. Williams is a graduate of West
Gloucestershire College of Education in the United Kingdom.

STEPHEN L. CONKLING has served as President of the Company since August
1998 and as Chief Operating Officer since December 1997. From April 1996 to July
1998, Mr. Conkling served as Vice President-Finance of the Company. The Company
intends to hire a Chief Financial Officer as soon as practicable, at which time
Mr. Conkling will serve as President and Chief Operating Officer of the Company
and will cease to serve as Vice President-Finance. Prior to joining the Company,
from January 1995 to March 1996, Mr. Conkling served as Chief Financial Officer
of Advanced Promotion Technologies, a publicly held database marketing company
that filed for Chapter 11 bankruptcy protection within two years after Mr.
Conkling left the company. From November 1993 to January 1995, Mr. Conkling was
a consultant providing strategic and financial strategy services. From 1991 to
November 1993, Mr. Conkling served as Chief Executive Officer of

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<PAGE> 52

Imagery, a document imaging software company. Mr. Conkling served as Chief
Financial Officer of Interactive Systems, a systems software company, from 1984
to January 1991. Prior to 1984, he was employed for 16 years by Xerox
Corporation in various finance and marketing positions. He is a graduate of
Purdue University, where he earned a Bachelor degree in industrial management,
and the University of Southern California, where he earned a Masters of Business
Administration.

R. MICHAEL BREWER has served as Chief Financial Officer of the Company
since August 18, 1998. Prior to joining the Company, from January 1994 to August
1998, Mr. Brewer was Vice President of Finance and Chief Financial Officer for
Boca Research, Inc., a computer peripheral manufacturing company. From 1978 to
January 1994 Mr. Brewer was Vice President of Finance for the U.S. operations of
Mitel Corporation, a Canadian company which manufactured PBX telephone equipment
and semiconductors. Mr. Brewer is a graduate of the University of Minnesota
where he earned a degree in business administration. Mr. Brewer received his
Florida CPA Certificate in 1975.

ANTHONY W. ALLEN has served as Vice President-Operations of the Company
since March 1997 and Secretary since the Company's incorporation in September
1995. From 1993 to August 1997, Mr. Allen served as Director of Marketing for
Arden Technologies, Inc., a manufacturer and distributor of wireless cable
transmitters, which from September 1995 to March 1997 contracted with the
Company to provide Mr. Allen's services to the Company. From 1990 to 1993 he
served as Director & General Manager of IMDS International Microwave
Distribution Systems, Ltd. in Barbados in which position he was responsible for
the international distribution and installation of wireless cable products. From
1988 to 1990 he served as Regional Sales Manager for Southfields Coachworks Ltd.
(located in the United Kingdom), a manufacturer of semi-trailers and heavy truck
bodywork. He is a graduate of Harper Adams in the United Kingdom, where he
earned a diploma in mechanical engineering.

RICHARD K. BRENNER has served as Vice President-Sales of the Company since
November 1997. Prior to joining the Company, Mr. Brenner was the founder and
President of Brenner Consulting Group, a consulting firm that provided marketing
consulting services to the Company, from February 1996 to October 1997. See
"Certain Transactions." From June 1995 to February 1996, Mr. Brenner served as
Vice President -- World-wide Business Planning for Scott Paper Company, in which
position he was responsible for directing business planning for all Scott
brands. From January 1994 to June 1995, Mr. Brenner served as Vice President-
Marketing of Advanced Promotion Technologies, a publicly held database marketing
company that filed for Chapter 11 bankruptcy protection within two years after
Mr. Brenner left the company. Mr. Brenner was employed by Procter and Gamble
from 1986 to January 1994 in various marketing and product management positions.
Prior to joining Procter and Gamble, Mr. Brenner was employed by Leo Burnett
USA, an advertising agency, as an account supervisor. Mr. Brenner is a graduate
of the University of Maryland, where he earned a Bachelor degree in business
administration, and Northwestern University, where he earned a Masters of
Management.

BILL J. BUZBEE has served as Vice President-Business Development of the
Company since October 1997 and Vice-President-Marketing and Sales from April
1995 to October 1997. Prior to joining the Company, he served as Manager of
Fuel/Ancillary Sales for National Auto/Truckstops Corp., a truckstop operator,
from October 1993 to April 1995. From 1989 to 1993 and from 1972 to 1984, Mr.
Buzbee was employed by Truckstops of America and served in various capacities
including as general manager of truckstop facilities located in Nashville,
Tennessee; West Memphis, Arkansas; Gary, Indiana and Grovertown, Indiana. Mr.
Buzbee was employed by a Petro Stopping Center franchisee from 1984 to 1986. Mr.
Buzbee attended State Community College in Columbia, Tennessee, and David
Lipscomb University in Nashville, Tennessee.

A. ALEXANDER EZAZI has served as Vice President-Marketing of the Company
since September 1997. Prior to joining the Company, from September 1995 to April
1997, Mr. Ezazi was Director of Marketing and Sales for PrimeCo, a joint venture
formed by AirTouch Communications and Bell Atlantic, to provide personal
communications services throughout the United States. From February 1993 to
September 1995, Mr. Ezazi worked for AirTouch Cellular, a division of AirTouch
Communications, as Director of Distribution Strategy for the Corporate Marketing
Group, where he was responsible for directing various distribution initiatives.
From 1992 to February 1993, Mr. Ezazi worked as Manager of Business Development
for the Los Angeles

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<PAGE> 53

Marketing and Sales Department of AirTouch Cellular, where he managed the
evaluation and implementation of new products and services in the Los Angeles
cellular market. Mr. Ezazi worked as a consultant for Andersen Consulting from
1988 to 1991. Mr. Ezazi is a graduate of the University of Pennsylvania and
Columbia University, where he earned a Masters of Business Administration.

JAMES D. GREEN has served as Vice President-Product Development of the
Company since November 1996. Prior to joining the Company, Mr. Green was
President of GreenLight Technologies, Inc., which was formed in 1994 as a
software development company specializing in frequency marketing and transaction
processing services for the truckstops and trucking companies and which
performed certain software programming consulting services for the Company. See
"Certain Transactions." From 1984 to 1994, Mr. Green worked for Comdata
Corporation as Senior Product Manager responsible for all transportation card
based products. Mr. Green worked as Product Manager for Financial Institutional
Services Inc. from 1982 to 1984 and as consultant for Computer Sciences
Corporation from 1980 to 1982. Mr. Green is a graduate of The Evergreen State
College in Olympia, Washington, where he earned a Bachelor degree in business
administration and computer science.

RALPH A. HEAD has served as Vice President-Fleet Sales of the Company since
January 1996. Mr. Head was President of Ralph Head & Associates, a
transportation consulting firm, from December 1994 to January 1996. Mr. Head
served as Vice President of Fleet Sales for National Auto/Truckstops from May
1993 to December 1994 and as President of Direct Bill Management, a financial
services company serving fleet trucking companies and truckstops, from January
1991 to May 1993. Mr. Head is a graduate of Auburn University, where he earned a
Bachelor degree in business administration.

YVES ROLAND MAYNARD has served as Vice President-Engineering of the Company
since September 1995 but has been employed by the Company since June 1993. Mr.
Maynard was employed by Glocom Engineering from August 1990 to June 1993, and by
Glocom Engineering Ltd./Canada from 1987 to May 1990, as Director of
Engineering, and as such was responsible for the engineering and installation of
microwave distribution systems. His experience at Glocom includes the
engineering and installation of microwave distribution systems for companies in
Canada, the United States and the Caribbean, and the design of equipment and
construction methods necessary to deliver cable television and telephone
services. From 1986 to 1987, Mr. Maynard was employed by Island Engineering BWI
as Director of Engineering. Mr. Maynard is a graduate of Red River Community
College in Winnipeg, Manitoba, where he earned a diploma in industrial
electronics.

ROBERT M. CHEFITZ has served as a director of the Company since November
1995. Mr. Chefitz has served as a Managing Director of Patricof & Co. Ventures,
Inc., a venture capital firm ("Patricof"), since 1991. Mr. Chefitz joined
Patricof in 1987 and served as Vice-President until 1991. From 1981 to 1987, Mr.
Chefitz served in various management positions with Golder, Thoma & Cressey Co.
of Chicago, Illinois. Mr. Chefitz' experience includes consulting with
management teams to consolidate fragmented industries, including communications,
security and specialty retailing. Mr. Chefitz serves as a director of Protection
One and several privately held companies in which the limited partnerships
managed by Patricof are investors. Mr. Chefitz is a graduate of Northwestern
University and Columbia University, where he earned a Bachelor degree and a
Masters of Business Administration, respectively.

THOMAS P. HIRSCHFELD has served as a director of the Company since November
1995. Mr. Hirschfeld has served as a Principal of Patricof since January 1995.
From January 1994 to January 1995, he served as Assistant to the Mayor of New
York City. From August 1986 to December 1993, Mr. Hirschfeld was employed by
Salomon Brothers as an investment banker. Mr. Hirschfeld serves as a director of
a number of privately held companies in which the limited partnerships managed
by Patricof are investors. He is a graduate of Harvard College and Balliol
College, Oxford.

RICHARD M. JOHNSTON has served as a director of the Company since August
1997. Mr. Johnston has served as Vice President-Investments and a director of
The Hillman Company, an investment holding company with diversified operations
("Hillman"), since 1970. Mr. Johnston served as Assistant to the President of
Hillman from 1965 to 1970 and Assistant to the Vice President-Investments of
Hillman from 1961 to 1965. Mr. Johnston serves as a director of Metrocall, Inc.,
a leading provider of paging and other

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<PAGE> 54

wireless messaging services, Novoste Corporation and several privately held
companies in each of which Hillman is an investor. Mr. Johnston is a graduate of
Washington & Lee University and the Wharton School of Finance of the University
of Pennsylvania, where he earned a Masters of Business Administration.

DANIEL K. O'CONNELL has served as a director of the Company since November
1995. Mr. O'Connell has been a private investor since April 1991. Mr. O'Connell
was employed by Ryder System, Inc., an international transportation services
company, from 1964 to April 1991 and served in various capacities including
Executive Vice President from 1974 to 1991, Financial Vice President from 1970
to 1974, General Counsel from 1968 to 1970 and attorney from 1964 to 1968. He is
a director of American Retirement Corporation in Nashville, Tennessee, which
develops, owns and manages assisted living, continuing care and congregate
living retirement communities throughout the United States, and of Fortress-FAE
Corporation in Boston, Massachusetts, which transports and stores art objects
and other high-value personal property. He also serves as a director of
Fiduciary Trust International of the South located in Miami, Florida, a
subsidiary of Fiduciary Trust Company International, headquartered in New York.
Mr. O'Connell is a graduate of Southern Illinois University of Carbondale,
Illinois, and Georgetown University Law Center. Mr. O'Connell's son is a partner
in the law firm of Kilpatrick Stockton LLP, which provides legal services to the
Company.

DAVID C. TURNER has served as a director of the Company since November
1996. Mr. Turner has worked as Senior Investment Analyst with the Michigan
Retirement System since 1985 and in this capacity shares in the management of a
$3.0 billion alternative investment portfolio. From 1978 to 1985, Mr. Turner
held several policy advisory and management positions in the Michigan Department
of Commerce with responsibilities for developing business and financial
legislation, implementing large-scale industrial development projects, serving
as a small business loan officer and overseeing the State of Michigan's
Technology Transfer Program between university research departments and the
private sector. Mr. Turner is a graduate of the State University of New York.

COMPOSITION OF THE BOARD OF DIRECTORS; EXECUTIVE OFFICERS

The Company's Bylaws provide that the number of members of the Company's
Board of Directors shall consist of between one and seven and that the Board has
the power to determine the number of directors (when not determined by the
stockholders) and to fill vacancies on the Board. The number of directors is
presently fixed at seven. The Company presently has six directors and one
vacancy on the Board of Directors. The Board of Directors, the holders of the
Series B Preferred Stock and the holders of the Series C Preferred Stock intend
to fill the existing vacancy with a person who is not an employee of the Company
as soon as practicable. All directors are elected annually to serve until the
next annual stockholders' meeting following their election and until their
successors are elected and qualified.

The Board of Directors has established a Compensation Committee and an
Audit Committee. The members of the Compensation Committee are Robert M.
Chefitz, David C. Turner and Ian Williams and the members of the Audit Committee
are Daniel K. O'Connell, Thomas P. Hirschfeld and Richard M. Johnston. The
Compensation Committee is responsible for reviewing the performance of all
executive officers and determining all compensation for such officers. The Audit
Committee is responsible for recommending to the Board of Directors the
appointment of independent auditors, reviewing with the auditors the plans and
results of the audit engagement, approving professional services provided by the
auditors, reviewing the independence of the independent public accountants,
considering the range of audit and non-audit fees and reviewing the adequacy of
the Company's internal accounting controls. The Board of Directors may from time
to time establish such other committees as circumstances warrant. Such
committees will have such authority and responsibility as is delegated by the
Board of Directors.

Pursuant to an Amended and Restated Security Holders' Agreement and
Exchange Agreement, dated as of November 13, 1996 (as amended pursuant to an
amendment, dated as of August 22, 1997, the "Security Holders' Agreement"), (i)
the Company's Board of Directors shall consist of not more than seven members,
(ii) as long as the Series A Preferred Stock has not been redeemed and paid in
full, the holders of the Series A Preferred Stock have the right to designate
two directors, (iii) the holders of the Series B Preferred Stock have the right
to designate one director, (iv) the holders of the Series C Preferred Stock have
the right to

50
<PAGE> 55

designate one director, (v) certain holders of the Common Stock have the right
to designate two directors, and (vi) the Board of Directors, the holders of the
Series B Preferred Stock and the holders of the Series C Preferred Stock will
mutually agree upon the remaining director.

Of the Company's current directors, Mr. Chefitz and Mr. Hirschfeld are the
designees of the holders of the Series A Preferred Stock, Mr. Turner is the
designee of the holders of the Series B Preferred Stock, Mr. Johnston is the
designee of the holders of the Series C Preferred Stock, and Mr. Williams and
Mr. O'Connell are the designees of the holders of the Common Stock.

Pursuant to the respective Certificates of Designations for the Series A
Preferred Stock, the Series B Preferred Stock and the Series C Preferred Stock,
the holders of the Series A Preferred Stock, voting as a separate class, are
entitled to elect two directors and, prior to the consummation of a registered
common stock offering that is a Qualifying Offering (as defined in the
applicable Certificate of Designations), the holders of the Series B Preferred
Stock and Series C Preferred Stock, each voting as a separate class are each
entitled to elect one director of the Company. Subsequent to the consummation of
a Qualifying Offering, but only for so long as at least 66 2/3% of the Common
Stock issuable upon conversion of the Series B Preferred Stock or the Series C
Preferred Stock, as the case may be, is held of record by the original
purchasers of such stock, the holders of a majority of the Common Stock issuable
upon conversion of the Series B Preferred Stock and the Series C Preferred Stock
shall each be entitled to nominate one person for election as a director of the
Company, which nominees the Company will include in management's slate of
nominees for election as directors of the Company. Whenever (i) dividends
declared on the Series B Preferred Stock or the Series C Preferred Stock are in
arrears in an amount equivalent to the aggregate dividends required to be paid
on such stock for any two quarterly periods, (ii) the Company fails to satisfy
its redemption obligations, (iii) the Company otherwise fails to perform certain
obligations under the Certificates of Designations authorizing such stock or
(iv) certain other events of default occur, the holders of the Series C
Preferred Stock, together with the holders of the Series B Preferred Stock, have
the exclusive right to elect a majority of the Board of Directors.

The Company currently pays no compensation to directors for serving in such
capacity.

The Company's executive officers are elected annually by the Board of
Directors to serve until their successors are elected and qualify. The Company
is not a party to an employment agreement with any of its executive officers.
There are no family relationships among any of the directors and executive
officers of the Company, except that Mr. Allen, Vice President-Operations of the
Company, is the brother-in-law of Mr. Williams, President and Chief Executive
Officer of the Company.

LIMITATIONS OF LIABILITY AND INDEMNIFICATION

The Delaware General Corporation Law (the "DGCL") permits a corporation to
include in its certificate of incorporation a provision eliminating or limiting
a director's personal liability to the corporation or its stockholders for
monetary damages for breaches of fiduciary duty. However, the DGCL expressly
provides that the liability of a director may not be eliminated or limited for
(i) breaches of his or her duty of loyalty to the corporation or its
stockholders, (ii) acts or omissions not in good faith or which involve
intentional misconduct or a knowing violation of law, (iii) the unlawful
purchase or redemption of stock or unlawful payment of dividends, or (iv) any
transaction from which the director derived an improper personal benefit. The
DGCL further provides that no such provision shall eliminate or limit the
liability of a director for any act or omission occurring prior to the date when
such provision becomes effective. The Company's Certificate of Incorporation
contains a provision eliminating director liability to the extent permitted by
the DGCL.

Generally, the DGCL permits a corporation to indemnify certain persons made
a party to any action, suit or proceeding by reason of the fact that such person
is or was a director, officer, employee or agent of the corporation or is or was
serving at the request of the corporation as a director, officer, employee or
agent of another corporation or enterprise provided that such person acted in
good faith and in a manner that person reasonably believed to be in or not
opposed to the best interests of the corporation. To the extent that person has
been successful in any such matter, that person shall be indemnified against
expenses actually and reasonably incurred by that person. In the case of an
action by or in the right of the corporation, no

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<PAGE> 56

indemnification may be made in respect of any matter as to which that person was
adjudged liable to the corporation unless and only to the extent that the
Delaware Court of Chancery or the court to which the action was brought
determines that despite the adjudication of liability that person is fairly and
reasonably entitled to indemnity for proper expenses. The Company's Bylaws
provide that each director and officer shall be indemnified by the Company to
the fullest extent allowed by Delaware law.

EXECUTIVE COMPENSATION

Summary Compensation

The following table sets forth certain information regarding the annual
compensation for the fiscal year ended June 30, 1998, with respect to the
Company's Chief Executive Officer and the Company's four other highest paid
executive officers (collectively, the "Named Executive Officers").

SUMMARY COMPENSATION TABLE

<TABLE>
<CAPTION>
ANNUAL COMPENSATION
-----------------------
NAME AND PRINCIPAL POSITION SALARY($) BONUS($)(1)
- --------------------------- --------- -----------
<S> <C> <C>
Ian Williams................................................ 157,500 --
Chairman of the Board, Chief Executive
Officer and Director
Stephen L. Conkling......................................... 132,501 --
President and Chief
Operating Officer
Jody Green.................................................. 127,500 --
Vice President-Product Development
A. Alexander Ezazi(2)....................................... 87,083 27,500
Vice President-Marketing
Richard Brenner(2).......................................... 73,333 27,500
Vice President-Sales
</TABLE>

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

(1) Represents guaranteed cash bonuses paid for fiscal 1997.
(2) Mr. Ezazi's employment by the Company commenced in September 1997 and Mr.
Brenner's employment by the Company commenced in November 1997.

Stock Options

The following table summarizes the number and value of unexercised options
held by Named Executive Officers as of June 30, 1998. No Named Executive
Officers exercised any options during the year ended June 30, 1998.

FISCAL YEAR-END OPTION VALUES

<TABLE>
<CAPTION>
NUMBER OF SECURITIES
UNDERLYING VALUE OF UNEXERCISED
UNEXERCISED OPTIONS IN-THE-MONEY OPTIONS
AS OF JUNE 30, 1998(#) AS OF JUNE 30, 1998($)(1)
----------------------------- -----------------------------
NAME EXERCISABLE UNEXERCISABLE EXERCISABLE UNEXERCISABLE
- ---- ----------- ------------- ----------- -------------
<S> <C> <C> <C> <C>
Stephen L. Conkling.......................... 27,151 40,727 222,640 333,960
12,000 18,000 74,400 111,600
Jody Green................................... 15,151 22,727 120,452 180,678
</TABLE>

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

(1) There was no public trading market for the Common Stock as of June 30, 1998.
These values have been calculated based on a fair market value of $9.20 per
share on June 30, 1998 less the per share exercise price. Such value was
determined by the Board of Directors based on the value of the Warrants
agreed upon by the Company and the initial investors in the Units in the
Unit Offering.

52
<PAGE> 57

EMPLOYMENT ARRANGEMENTS

The Company does not have employment agreements with any of its executive
officers. In connection with its acquisition in November 1996 of certain
software from a software development company of which Mr. Green, an executive
officer of the Company, owned 50%, the Company agreed to pay Mr. Green an annual
salary of $100,000 as long as he is employed by the Company. See "Certain
Transactions." The Company's executive officers are not entitled to any payments
in connection with a termination of employment or a change in control of the
Company. Pursuant to the Company's Stock Option Plan, the exercisability of
options granted under such plan is accelerated in the event of certain changes
in control of the Company.

BONUS PLAN

In February 1998, the Board of Directors adopted the Company's Compensation
Plan (the "Compensation Plan") to provide cash and/or stock awards to certain
key employees of the Company, including all of the Company's executive officers.
Pursuant to the Compensation Plan, such employees are each eligible for bonuses
based on a percentage of their annual base salary, which percentage may be up to
61% depending upon the employee's position with the Company (the "Potential
Bonus"). The Potential Bonus for any employee is then subdivided into two
components consisting of: (i) 40% for participants other than executive
officers, and 60% for executive officers, of the Potential Bonus for the
Company's achievement of certain goals for the Company's earnings before
interest, taxes, depreciation and amortization ("EBITDA") during the applicable
period (the "Company Component"), and (ii) 40% for executive officers, and 60%
for participants other than executive officers, of the Potential Bonus for the
employee's achievement of certain functional and personal goals for the
applicable period (the "Personal Component"). The Company's Board of Directors
establishes the Company's goals for EBITDA, as well as each employee's
functional and personal goals, prior to the commencement of the applicable
period.

The percentage of the Company Component and the Personal Component that the
employee actually may receive is determined based upon the percentage of the
Company's goal for EBITDA that the Company achieves during the applicable period
and the percentage of the employee's achievement of his or her functional and
personal goals for the applicable period as determined by the Board of
Directors. The allocation of the bonus between cash and/or stock awards shall be
determined by the Board of Directors. The allocation of the bonus between cash
and/or stock awards shall be determined by the Board of Directors.

STOCK OPTION PLAN

Under the Park 'N View, Inc. Stock Option Plan (the "Stock Option Plan"),
options to purchase up to 800,000 shares of Common Stock may be granted to
employees, directors, consultants and independent contractors of the Company.
The Stock Option Plan is presently administered by the Board of Directors. Each
option granted under the Stock Option Plan must be exercised within a period
fixed by the Board of Directors which, subject to certain limitations, may not
exceed ten years from the date of grant of the option. The Company may grant
incentive stock options (intended to qualify under Section 422 of the Internal
Revenue Code of 1986) or nonqualified stock options. The exercise price of
incentive stock options under the Stock Option Plan may not be less than 100% of
the fair market value of the Common Stock on the date of grant. Options granted
under the Stock Option Plan become exercisable at such time or times as the
Board of Directors shall determine. Of the options outstanding under the Stock
Option Plan as of March 31, 1998, options to purchase an aggregate of 219,390
shares of Common Stock were granted in August 1996 having an exercise price of
$1.00, options to purchase an aggregate of 32,500 shares of Common Stock were
granted in November 1996 having an exercise price of $1.00 per share, options to
purchase an aggregate of 75,756 shares of Common Stock were granted in December
1996 having an exercise price of $1.25 per share, options to purchase an
aggregate of 7,200 shares of Common Stock were granted in March 1997 having an
exercise price of $1.50 per share, and options to purchase an aggregate of
75,000 shares of Common Stock were granted in June 1997 having an exercise price
of $3.00 per share. All of such outstanding options become exercisable in five
annual increments of 20% each commencing on the date of grant so long as
employment with the

53
<PAGE> 58

Company continues. The exercise price of outstanding options to date has been
the deemed fair market value of the Common Stock on the date of grant. No
options have been granted to any director of the Company.

The Company plans to grant options to purchase an aggregate of 259,000
shares of Common Stock to certain of its executive officers. The Company
currently expects that such options to purchase 152,000 shares of Common Stock
will have an exercise price equal to the fair market value of the Common Stock
on the date of grant as determined by the Board of Directors and that such
options to purchase 107,000 shares of Common Stock will have an exercise price
substantially below such value.

COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION

Decisions concerning the compensation of the Company's executive officers
for the year ended June 30, 1998 were made by the Company's Compensation
Committee of which Mr. Williams, President and Chief Executive Officer of the
Company, is a member.

CERTAIN TRANSACTIONS

In November 1995, the Company, which was organized by Patricof, Ian
Williams and the then-partners of Park 'N View, Ltd. (Sam Hashman, Monte
Nathanson and Nelgo Investments, of which Daniel O'Connell is a general
partner), acquired the business and assets, and assumed the liabilities, of Park
'N View, Ltd. In connection with such purchase, the Company issued approximately
2.3 million shares of Common Stock to Park 'N View, Ltd. Park 'N View, Ltd.
subsequently distributed such shares to its partners. The amount of the net
liabilities assumed by the Company was $84,446, including a promissory note of
Park 'N View, Ltd., to Sam Hashman in the principal amount of $150,000, which
was subsequently paid in full by the Company. In addition, over a 12-month
period commencing in November 1995, the Patricof Managed Funds invested $3.8
million in the Company in exchange for which the Company issued to the Patricof
Managed Funds an aggregate of 2.0 million shares of Common Stock, 70,010 shares
of Series A Preferred Stock and $3.0 million aggregate principal amount of the
Company's 8% Subordinated Notes. During the fall of 1996, the Company issued to
the Patricof Managed Funds an additional $1.5 million aggregate principal amount
of the Company's 8% Subordinated Notes and warrants to purchase 239,250 shares
of Common Stock. In connection with the sale of the Series A Preferred Stock,
the Company entered into certain agreements with certain holders of the capital
stock of the Company. Pursuant to these agreements, certain holders of Common
Stock and Series A Preferred Stock obtained rights of first refusal with respect
to proposed sales of stock by the Company or by certain holders of shares of
Common Stock of the Company. The holders of the Company's outstanding shares of
Common Stock and Series A Preferred Stock also have certain co-sale rights. See
"Description of Capital Stock."

Park 'N View, Ltd., issued to Sam Hashman, its promissory note in the
principal amount of approximately $150,000. This note was issued in connection
with development of the PNV Network. This note was assumed by the Company in
November 1995 and paid (in three installments during 1995 and 1996) from the net
proceeds of the sale of the Series A Preferred Stock to the Patricof Managed
Funds.

In November 1996, in connection with the sale of the Series B Preferred
Stock, (i) the Patricof Managed Funds (a) converted $3.0 million aggregate
principal amount of the Company's 8% Subordinated Notes plus $180,000 in
interest accrued thereon into 318,065 shares of the Series A Preferred Stock,
(b) converted $1.5 million aggregate principal amount of such notes, and
warrants to purchase 239,250 shares of Common Stock, into 137,237 shares of the
Series B Preferred Stock and (c) purchased 45,746 shares of Series B Preferred
Stock for $500,000, (ii) the State of Michigan Retirement System purchased
731,930 shares of the Series B Preferred Stock for $8.0 million and (iii)
Benefit Capital Management Corporation purchased 274,474 shares of the Series B
Preferred Stock for $3.0 million. In connection with the sale of the Series B
Preferred Stock, the Company entered into certain agreements with certain
holders of the capital stock of the Company. Pursuant to these agreements, the
Company granted certain registration rights to certain holders of shares of
Common Stock and to holders of the shares of Common Stock issuable upon the
conversion of the Series B Preferred Stock and any additional shares of Common
Stock acquired as a result of a stock dividend, stock split, or other
distribution in respect of the Series B Preferred Stock. See "Description of
Capital Stock --

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<PAGE> 59

Registration Rights." Certain holders of Common Stock and Series B Preferred
Stock also obtained rights of first refusal with respect to proposed sales of
stock by the Company or by certain holders of shares of Common Stock pursuant to
these agreements. The holders of the Company's outstanding shares of Common
Stock, and Series B Preferred Stock also have certain co-sale rights pursuant to
these agreements. See "Description of Capital Stock."

From November 1995 to November 1996, GreenLight Technologies, Inc.
("Greenlight"), of which James Green owned 50%, and Lewis Tatham, also an
employee of the Company, owned the remaining 50%, provided certain software
programming consulting services to the Company relating to the PNV Software
pursuant to a software development agreement. Pursuant to the provisions of this
agreement, during this period, the Company paid Greenlight an aggregate of
approximately $49,800 in fees. In November 1996, pursuant to a technology
transfer agreement, Greenlight, Mr. Green and Mr. Tatham transferred and
assigned to the Company certain software relating to the PNV Software developed
by them, including rights in software developed pursuant to the software
development agreement, in consideration of the Company's payment to each
individual of a $100,000 annual salary as long as he is employed by the Company
and the grant to each of them of an option to purchase 37,878 shares of Common
Stock having an exercise price of $1.25 per share and becoming exercisable in
five annual cumulative increments of 20% each commencing on the date of grant as
long as employment continues.

In August 1997, the Company issued an aggregate of 2,328,543 shares of
Series C Preferred Stock for $18.6 million, of which (i) Henry L. Hillman, Elsie
Hilliard Hillman and C.G. Grefenstette, Trustees, purchased 812,500 shares of
Series C Preferred Stock for $6.5 million, (ii) the Patricof Managed Funds
purchased 125,000 shares of Series C Preferred Stock for $1.0 million, (iii)
Benefit Capital Management Corporation purchased 125,000 shares of Series C
Preferred Stock for $1.0 million and (iv) the State of Michigan Retirement
System purchased 125,000 shares of Series C Preferred Stock for $1.0 million. In
connection with the sale of the Series C Preferred Stock, the Company entered
into certain amendments to the agreements with certain holders of the capital
stock of the Company that the Company had entered into in connection with the
sale of the Series A Preferred Stock and the Series B Preferred Stock. Pursuant
to these amendments, the Company granted certain registration rights to holders
of the shares of Common Stock issuable upon the conversion of the Series C
Preferred Stock and any additional shares of Common Stock acquired as a result
of a stock dividend, stock split, or other distribution in respect of the Series
C Preferred Stock. See "Description of Capital Stock -- Registration Rights."
These amendments also provided holders of Series C Preferred Stock rights of
first refusal with respect to proposed sales of stock by the Company or by
certain holders of shares of Common Stock. The holders of the Series C Preferred
Stock also have certain co-sale rights pursuant to these amendments. See
"Description of Capital Stock."

Prior to his employment by the Company, Richard Brenner provided certain
marketing consulting services to the Company, from December 1996 to October
1997. During this period, the Company paid Mr. Brenner an aggregate of
approximately $52,000 in fees.

Since December 1995, Mr. Williams has personally guaranteed the Company's
obligations of $480,000 under lease agreements for construction equipment and
telephone switches to which the Company is a party. In May 1997, the Company
loaned $59,000 to Mr. Buzbee in connection with his relocation from the
Company's Nashville, Tennessee office to its headquarters in Ft. Lauderdale,
Florida. This loan was evidenced by Mr. Buzbee's promissory note payable to the
Company, bearing interest at the prime rate (as defined in such promissory
note). This note was satisfied in August 1997.

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<PAGE> 60

PRINCIPAL STOCKHOLDERS

The following table sets forth, as of June 15, 1998, certain information
regarding the beneficial ownership of the Common Stock by (i) each person that
is a member of the Board of Directors of the Company, (ii) each person or entity
known by the Company to be the beneficial owner of 5% or more of the outstanding
Common Stock of the Company and (iii) all executive officers and directors of
the Company as a group. The persons and entities named in the table have sole
voting and investment power with respect to all shares shown as beneficially
owned by them, except as indicated in the footnotes below.

<TABLE>
<CAPTION>
SHARES
BENEFICIALLY PERCENT OF SHARES
NAME OWNED OUTSTANDING
- ---- ------------ -----------------
<S> <C> <C>
Ian Williams(1)............................................. 441,953 5.19%
Daniel K. O'Connell(2)...................................... 270,810 3.18
Robert M. Chefitz(3)........................................ 2,372,919 27.85
Thomas P. Hirschfeld(4)..................................... 2,372,919 27.85
David C. Turner(5).......................................... 1,140,918 13.39
Richard M. Johnston(6)...................................... 12,500 *
Sam Hashman(7).............................................. 1,011,560 11.87
Patricof & Co. Ventures, Inc., as Manager(8)................ 2,372,919 27.85
MPN Partners, Ltd.(9)....................................... 540,856 6.35
State of Michigan Retirement System(10)..................... 1,140,918 13.39
Benefit Capital Management Corporation(11).................. 500,000 5.87
Henry L. Hillman, Elsie Hilliard Hillman and C.G.
Grefenstette, Trustees(12)................................ 812,500 9.53
All directors and officers as group (14 persons)(13)........ 4,411,866 50.74
</TABLE>

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

* Less than 1%
(1) Includes 22,950 shares of Common Stock beneficially owned by PNV General
Partner, Inc., of which Mr. Williams, Mr. Hashman and Monte Nathanson, the
general partner of MPN Partners, Ltd., each owns one-third of such shares.
(2) Represents an aggregate of 270,810 shares of Common Stock beneficially
owned by Nelgo Investments, a partnership of which Mr. O'Connell is a
general partner. Mr. O'Connell owns 15% of Nelgo Investments.
(3) Represents an aggregate of 2,372,919 shares of Common Stock presently
issuable upon conversion of outstanding shares of Series B Preferred Stock
and Series C Preferred Stock beneficially owned by the Patricof Managed
Funds. Mr. Chefitz, a director of the Company, is a Managing Director of
Patricof, and a general partner in the limited partnerships which Patricof
& Co. Ventures, Inc. manages. Mr. Chefitz does not exercise sole or shared
voting or investment power with respect to such shares and disclaims
beneficial ownership of such shares.
(4) Represents an aggregate of 2,372,919 shares of Common Stock presently
issuable upon conversion of outstanding shares of Series B Preferred Stock
and Series C Preferred Stock beneficially owned by the Patricof Managed
Funds. Mr. Hirschfeld, a director of the Company, is a Principal of
Patricof. Mr. Hirschfeld does not exercise sole or shared voting or
investment power with respect to such shares and disclaims beneficial
ownership of such shares.
(5) Represents an aggregate of 1,140,918 shares presently issuable upon
conversion of outstanding shares of Series B Preferred Stock and Series C
Preferred Stock beneficially owned by the State of Michigan Retirement
System. Mr. Turner, a director of the Company, is a Senior Investment
Analyst with the State of Michigan Retirement System. Mr. Turner does not
exercise sole or shared voting or investment power with respect to such
shares and disclaims beneficial ownership of such shares.
(6) Represents shares of Common Stock presently issuable upon conversion of
outstanding shares of Series C Preferred Stock beneficially owned by
Richard M. Johnston Trust #2, for which Mr. Johnston is the sole trustee
and beneficiary. Does not include 1,250,000 shares beneficially owned by
affiliates and related parties of The Hillman Company. Mr. Johnston is Vice
President-Investments and a director of

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<PAGE> 61

The Hillman Company. Mr. Johnston does not exercise sole or shared voting
or investment power with respect to such shares and disclaims beneficial
ownership of such shares.
(7) Includes 22,950 shares of Common Stock beneficially owned by PNV General
Partner, Inc., of which Mr. Williams, Mr. Hashman and Monte Nathanson, the
general partner of MPN Partners, Ltd., each owns one-third of such shares.
(8) Consists of shares of Common Stock and shares of Common Stock presently
issuable upon conversion of outstanding shares of Series B Preferred Stock
and Series C Preferred Stock owned of record as follows: (i) an aggregate
of 1,755,193 shares held by APA Excelsior IV, L.P., (ii) an aggregate of
309,513 shares held by APA Excelsior IV/Offshore, L.P. and (iii) an
aggregate of 308,213 shares held by The P/A Fund, L.P. Patricof & Co.
Ventures, Inc., directly or indirectly, controls, and has sole voting or
investment power with regard to shares held by, such limited partnerships.
(9) MPN Partners, Ltd. is a limited partnership of which Monte Nathanson, a
founder of the Company, is the general partner. Includes 22,950 shares of
Common Stock beneficially owned by PNV General Partner, Inc., of which Mr.
Williams, Mr. Hashman and Mr. Nathanson each own one-third.
(10) Consists of shares of Common Stock presently issuable upon conversion of
outstanding shares of Series B Preferred Stock and Series C Preferred
Stock. Does not include shares held by APA Excelsior IV, L.P., a limited
partnership of which the State of Michigan Retirement System is a limited
partner.
(11) Consists of shares of Common Stock presently issuable upon conversion of
outstanding shares of Series B Preferred Stock and Series C Preferred Stock
owned of record by Benefit Capital Management Corporation as Investment
Manager for The Prudential Insurance Company of America Separate Account
No. VCA-GA-5298 ("Benefit"). Benefit has voting power as to the shares of
Common Stock issuable upon conversion of the Series B Preferred Stock and
Series C Preferred Stock held by Benefit. Benefit is a wholly owned
subsidiary of Union Carbide Corporation, a New York Corporation ("UCC").
Benefit manages the assets of UCC's retirement program plan for employees
of UCC and its participating subsidiaries (the "Plan"). In connection with
the purchase of certain annuities by the Plan, Prudential has established a
separate insurance account with respect to the Plan. Prudential disclaims
beneficial ownership of the shares.
(12) Consists of shares of Common Stock presently issuable upon conversion of
outstanding shares of Series C Preferred Stock owned of record as follows:
(i) 187,500 shares held by a trust for the benefit of Henry L. Hillman (the
"HLH Trust"), and (ii) 625,000 shares owned by Juliet Challenger, Inc., an
indirect, wholly-owned subsidiary of The Hillman Company ("THC"). THC is
controlled by the HLH Trust. The Trustees of the HLH Trust are Henry L.
Hillman, Elsie Hilliard Hillman and C. G. Grefenstette (the "HLH
Trustees"). The HLH Trustees share voting and investment power with respect
to the shares held of record by the HLH Trust and the assets of THC. Does
not include an aggregate of 250,000 shares held by four trusts for the
benefit of members of the Hillman family, as to which shares the HLH
Trustees (other than Mr. Grefenstette, who is one of the trustees of such
family trusts) disclaim beneficial ownership. Also does not include 187,500
shared held by Venhill Limited Partnership, as to which shares the HLH
Trustees disclaim beneficial ownership. Howard B. Hillman, the general
partner of Venhill Limited Partnership, is a step-brother of Henry L.
Hillman.
(13) Includes an aggregate of 172,786 shares of Common Stock subject to options
that are presently exercisable or become exercisable by November 30, 1998.

The addresses of the persons named in the foregoing table who beneficially
own 5% or more of the outstanding Common Stock (including shares of Common Stock
currently issuable upon the conversion of the outstanding Series B Preferred
Stock and the Series C Preferred Stock) are as follows: (i) Ian Williams and Sam
Hashman, c/o Park 'N View, Inc., 11711 NW 39th Street, Coral Springs, Florida
33065, (ii) Robert M. Chefitz, Thomas P. Hirschfeld and the Patricof Managed
Funds, c/o Patricof & Co. Ventures, Inc., 445 Park Avenue, New York, New York
10022, (iii) MPN Partners, Ltd., 17058 White Haven Drive, Boca Raton, Florida
33496, (iv) David C. Turner and State of Michigan Retirement System, 430 West
Allegan Street, Lansing, Michigan 48922, (v) Benefit Capital Management
Corporation, 39 Old Ridgebury Road, Danbury, Connecticut 06817, and (vi) Henry
L. Hillman, Elsie Hilliard Hillman and C.G. Grefenstette, Trustees, 2000 Grant
Building, Pittsburgh, Pennsylvania 15219.

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<PAGE> 62

SELLING SECURITY HOLDERS

The following table sets forth, as of a recent practicable date prior to
the date of this Prospectus, certain information with respect to the Warrants
owned by the Selling Security Holders listed below. As of the date hereof, none
of the Selling Security Holders owns any of the Warrant Shares offered hereby.
Such information has been obtained from such holders, DTC and/or the Warrant
Agent. None of such holders has, or within the past three years, has had any
position, office or other material relationship with the Company.

<TABLE>
<CAPTION>
WARRANTS WARRANTS
BENEFICIALLY BENEFICIALLY
OWNED PRIOR TO WARRANTS BEING OWNED AFTER
NAME THE OFFERING PERCENT OF CLASS OFFERED THE OFFERING
- ---- -------------- ---------------- -------------- ------------
<S> <C> <C> <C> <C>
SunAmerica High Income Fund......... 1,875 2.50 1,875 --
SunAmerica Diversified Income
Fund.............................. 625 .83 625 --
SunAmerica Series Trust -- High
Yield Bond Portfolio.............. 3,000 4.00 3,000 --
Prospect Street High Income
Portfolio Inc..................... 1,000 1.33 1,000 --
Conseco Strategic Income Fund....... 1,000 1.33 1,000 --
Midland Life Insurance Co. -- High
Yield............................. 500 .66 500 --
Beneficial Standard Life Insurance
Co. -- High Yield................. 1,500 2.00 1,500 --
Conseco Annuity Assurance........... 2,000 2.66 2,000 --
Conseco Series Trust -- Asset
Allocation........................ 250 .33 250 --
Conseco Fund Group -- High Yield.... 150 .20 150 --
Conseco Fund Group -- Asset
Allocation........................ 100 .13 100 --
Aristeia International.............. 275 .36 275 --
Aristeia Trading.................... 225 .30 225 --
Dreyfus High Yield Securities
Fund.............................. 1,000 1.33 1,000 --
Illinois State Board of
Investment........................ 1,000 1.33 1,000 --
Aetna High Yield Fund............... 150 .20 150 --
Aetna High Yield VP................. 50 .07 50 --
High Yield Account.................. 800 1.07 800 --
Van Kampen High Yield Fund.......... 1,000 1.33 1,000 --
Van Kampen American Capital High
Income Corporate Bond Fund........ 3,000 4.00 3,000 --
Van Kampen American Capital Income
Trust............................. 1,000 1.33 1,000 --
Debt Strategies Fund, Inc........... 500 .66 500 --
Senior High Income Portfolio,
Inc............................... 500 .66 500 --
Merrill Lynch Debt Strategies
Portfolio......................... 500 .66 500 --
Merrill Lynch Global Investment
Series: Income Strategies
Portfolio......................... 2,500 3.33 2,500 --
LM High Yield....................... 3,000 4.00 3,000 --
LM Offshore......................... 2,000 2.67 2,000 --
North Dakota High Yield............. 1,000 1.33 1,000 --
AIM High Yield Fund, Inc............ 15,400 20.53 15,400 --
AIM V.I. High Yield Fund, Inc....... 100 .13 100 --
Pershing/Division of DLJ............ 4,000 5.33 4,000 --
Phoenix High Yield Fund............. 4,000 5.33 4,000 --
CS Structured Credit Fund, Ltd...... 1,000 1.33 1,000 --
Managed High Yield Plus Fund........ 7,000 9.33 7,000 --
Managed High Yield Fund............. 1,500 2.00 1,500 --
</TABLE>

58
<PAGE> 63

Because the Selling Security Holders may, pursuant to this Prospectus,
offer all or some portion of the Warrants they presently hold, no estimate can
be given as to the number of Warrants that will be held by the Selling Security
Holders upon termination of any such sales. In addition, the Selling Security
Holders identified above may have sold, transferred or otherwise disposed of all
or a portion of their Warrants since the date on which they provided the
information regarding their Warrants, in transactions exempt from the
registration requirements of the Securities Act. See "Plan of Distribution."

Only Selling Security Holders identified above who own the Warrants set
forth opposite each such Selling Security Holder's name in the foregoing table
on the effective date of the Registration Statement, or in supplements to this
Prospectus, may sell such Warrants pursuant to the Registration Statement. The
Company may from time to time, in accordance with the Warrant Registration
Rights Agreement, include additional Selling Security Holders in supplements to
this Prospectus.

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<PAGE> 64

DESCRIPTION OF WARRANTS

The Warrants have been issued pursuant to the Warrant Agreement between the
Company and State Street Bank and Trust Company, as Warrant Agent. The following
summary of certain provisions of the Warrant Agreement does not purport to be
complete and is qualified in its entirety by reference to the provisions of the
Warrant Agreement including the definitions therein of certain terms used below.
The Warrant Agreement has been filed as an exhibit to the Registration Statement
and a copy is available as set forth under the heading "Available Information"
or will be made available to Warrantholders and prospective purchasers of the
Warrants upon request.

GENERAL

Each Warrant, when exercised, will entitle the registered holder thereof to
receive 6.73833 fully paid and non-assessable shares of Common Stock at an
exercise price of $.01 per share (the "Exercise Price"). The number of Warrant
Shares is subject to adjustment in certain cases referred to below. The Warrants
will entitle the holders thereof to purchase an aggregate of 505,375 Warrant
Shares, or approximately 5.0% of the Common Stock on a fully diluted basis, as
of the consummation of the Unit Offering. The Warrants will be exercisable at
any time on or after the Separation Date and prior to 5:00 p.m., New York City
time, on May 15, 2008. The exercise of the Warrants will be subject to
applicable federal and state securities laws.

The Warrants may be exercised by surrendering to the Company the warrant
certificates evidencing the Warrants to be exercised with the accompanying form
of election to purchase properly completed and executed, together with payment
of the Exercise Price. Payment of the Exercise Price may be made in the form of
cash or by certified or official bank check payable to the Warrant Agent for the
account of the Company. Upon surrender of the warrant certificate and payment of
the Exercise Price, the Company will deliver or cause to be delivered, to or
upon the written order of such holder, stock certificates representing the
number of whole shares of Common Stock to which the holder is entitled. If less
than all of the Warrants evidenced by a warrant certificate are to be exercised,
a new warrant certificate will be issued for the remaining number of Warrants.

No fractional shares of Common Stock will be issued upon exercise of the
Warrants. The Company will arrange to have paid to the holder of the Warrant at
the time of exercise an amount in cash equal to the current market value of any
such fractional shares of Common Stock less a corresponding fraction of the
Exercise Price.

The holders of the Warrants will have no right (i) to vote on matters
submitted to the stockholders of the Company, (ii) to receive notice of any
meeting of stockholders of the Company or (iii) to receive dividends. The
holders of the Warrants will not be entitled to share in the assets of the
Company in the event of liquidation, dissolution or the winding up of the
Company. In the event a bankruptcy or reorganization is commenced by or against
the Company, a bankruptcy court may hold that unexercised Warrants are executory
contracts which may be subject to rejection by the Company with approval of the
bankruptcy court, and the holders of the Warrants may, even if sufficient funds
are available, receive nothing or a lesser amount as a result of any such
bankruptcy case than they would be entitled to if they had exercised their
Warrants prior to the commencement of any such case.

In the event of a taxable distribution to holders of shares of Common Stock
that results in an adjustment to the number of shares of Common Stock or other
consideration for which a Warrant may be exercised, the holders of the Warrants
may, in certain circumstances, be deemed to have received a distribution subject
to United States federal income tax as a dividend. See "Certain United States
Federal Income Tax Considerations -- The Warrants." The number of shares of
Common Stock purchasable upon exercise of the Warrants will be subject to
adjustment in certain events including: (i) the payment by the Company of
dividends and other distributions on its shares of Common Stock in shares of
Common Stock, (ii) subdivisions, combinations and reclassifications of the
shares of Common Stock, (iii) the issuance to all holders of shares of Common
Stock of rights, options or warrants entitling them to subscribe for shares of
Common Stock or securities convertible into, or exchangeable or exercisable for
shares of Common Stock at an offering price (or with an initial conversion,
exchange or exercise price) which is less than the current market price per
share (as

60
<PAGE> 65

defined in the Warrant Agreement) of shares of Common Stock, (iv) the
distribution to holders of shares of Common Stock of any cash, evidences of
indebtedness, other securities or other properties or assets or rights or
warrants to purchase any such securities (excluding those rights and warrants
referred to in clause (iii) above and any cash dividend that, when added to all
other cash dividends paid in the year prior to the declaration date of such
dividend (excluding any dividend included in a prior adjustment of the Exercise
Price) does not exceed 5% of the current market price), (v) the issuance of
shares of Common Stock for a consideration per share less than the then current
market price per share (excluding securities issued in transactions referred to
in clauses (i) through (iv) above), (vi) the issuance of securities convertible
into or exchangeable for shares of Common Stock for a conversion or exchange
price plus consideration received upon issuance less than the then current
market price per share of Common Stock (excluding securities issued in
transactions referred to in clauses (iii) and (iv) above) and (vii) certain
other events that could have the effect of depriving holders of the Warrants of
the benefit of all or a portion of the purchase rights evidenced by the
Warrants; provided, however, that no adjustment will be required upon conversion
of the Series B Preferred Stock or the Series C Preferred Stock or upon issuance
of shares pursuant to employee stock option plans or warrants to purchase shares
of Common Stock outstanding as of the date hereof.

In the case of certain consolidations or mergers of the Company, or the
sale of all or substantially all of the assets of the Company to another
corporation, each Warrant will thereafter be exercisable for the right to
receive the kind and amount of shares of stock or other securities or property
to which such holder would have been entitled as a result of such consolidation,
merger or sale had the Warrants been exercised immediately prior thereto.

AMENDMENT

From time to time, the Company and the Warrant Agent, without the consent
of the holders of the Warrants, may amend or supplement the Warrant Agreement
for certain purposes, including curing defects or inconsistencies or making any
change that does not materially adversely affect the rights of any holder. Any
amendment or supplement to the Warrant Agreement that has a material adverse
effect on the interests of the holders of the Warrants will require the written
consent of the holders of a majority of the then outstanding Warrants (excluding
Warrants held by the Company or any of its Affiliates). The consent of each
holder of the Warrants affected will be required for any amendment pursuant to
which the Exercise Price would be increased or the number of shares of Common
Stock purchasable upon exercise of Warrants would be decreased (other than
pursuant to adjustments provided in the Warrant Agreement).

REGISTRATION RIGHTS

The Company is required under the Warrant Registration Rights Agreement to
file and use its best efforts to make effective, by the earlier of (i) the date
that is one year after the date of the closing of the Offering and (ii) 65 days
after the occurrence of a Change of Control, and (subject to certain "black out"
periods) maintain effective until the earlier of expiration of all Warrants or
such time as all the Warrants and/or Warrant Shares have been sold pursuant to
such shelf registration statement, may be distributed pursuant to Rule 144 or
may be transferred pursuant to Rule 144(k), a shelf registration statement on an
appropriate form under the Securities Act covering (A) the resale of Warrants,
(B) the issuance of the Warrant Shares upon the exercise of the Warrants and (C)
the resale of Warrant Shares upon exercise of the Warrants by broker-dealers.
Purchasers of Units will be able to exercise the Warrants only if a registration
statement relating to the shares of Common Stock underlying the Warrants is then
in effect or if the exercise of such Warrants is exempt from the registration
requirements of the Securities Act and only if such securities are qualified for
sale or exempt from the registration requirements of the Securities Act and only
if such securities are qualified for sale or exempt from qualifications under
the applicable securities laws of the states in which the various holders of the
Warrants reside. The Company will be unable to issue shares of Common Stock to
those persons desiring to exercise their Warrants if a registration statement
covering the securities issuable upon the exercise of the Warrants is not
effective (unless the sale and issue of shares upon the exercise of such Warrant
is exempt from the registration requirements of the Securities Act) or if such
securities are not qualified or exempt from qualification in the states in which
the holders of the Warrants reside. If the Company does not

61
<PAGE> 66

comply with these and other obligations, subject to certain limitations, as set
forth in the Warrant Registration Rights Agreement, it will be required to pay
liquidated damages to holders of Warrants or Warrant Shares under certain
circumstances.

Each holder of Warrants that sells such Warrants pursuant to the
Registration Statement generally will be required to be named as a selling
security holder in the related prospectus and to deliver a prospectus to the
purchaser, will be subject to certain of the civil liability provisions under
the Securities Act in connection with such sales and will be bound by certain
provisions of the Warrant Agreement which are applicable to such holder
(including certain indemnification obligations). In addition, each holder of
Warrants will be required to deliver information to be used in connection with
the Registration Statement in order to have its Warrants included in the
Registration Statement.

DESCRIPTION OF CAPITAL STOCK

The following summary of the terms and provisions of the Company's capital
stock does not purport to be complete and is qualified in its entirety by
reference to the actual terms and conditions of the capital stock contained in
the Company's Certificate of Incorporation, as amended, and the respective
Certificates of Designation, each as amended, of the Series A Preferred Stock,
the Series B Preferred Stock and the Series C Preferred Stock. The following
summary reflects the Company's Certificate of Incorporation, as amended, the
respective Certificates of Designation, each as amended, of the Series A
Preferred Stock, the Series B Preferred Stock and the Series C Preferred Stock,
and certain agreements entered into in connection with the Company's sale of the
Series A Preferred Stock, the Series B Preferred Stock and the Series C
Preferred Stock.

The Company's Certificate of Incorporation authorizes 12,000,000 shares of
common stock, par value $.001 per share, and 5,750,000 shares of preferred
stock, par value $.01 per share. The Company has designated 627,630 shares of
the Preferred Stock as Series A Preferred Stock, 1,372,370 shares of the
Preferred Stock as Series B 7% Cumulative Convertible Preferred Stock, and
3,750,000 shares of the Preferred Stock as Series C 7% Cumulative Convertible
Preferred Stock.

As of June 15, 1998, there were issued and outstanding 4,318,182 shares of
Common Stock, 388,065 shares of Series A Preferred Stock, 1,372,370 shares of
Series B Preferred Stock, and 2,328,543 shares of Series C Preferred Stock. The
Company has not issued any other shares of the Company's capital stock.
Immediately prior to the consummation of this Offering, options to acquire
409,846 shares of the Company's Common Stock will be outstanding. In addition,
the Company has reserved (i) 390,154 shares of Common Stock for issuance upon
the exercise of stock options available for future grants under the Stock Option
Plan; (ii) 1,372,300 shares of Common Stock for issuance upon conversion of the
issued and outstanding Series B Preferred Stock; (iii) 2,328,543 shares of the
Common Stock for issuance upon conversion of the issued and outstanding Series C
Preferred Stock; and (iv) an aggregate of 785,774 shares of Common Stock subject
to outstanding warrants consisting of: (A) 280,399 having an exercise price of
$8.00 per share, including presently exercisable warrants to purchase 100,399
shares of Common Stock granted to BT Alex. Brown Incorporated in connection with
the offer and sale of the Series C Preferred Stock, and (B) 505,375 having an
exercise price of $0.01 per share granted to the Initial Purchaser in connection
with the Unit Offering (and subsequently resold by the Initial Purchaser in the
form of the Units to qualified institutional buyers pursuant to Rule 144A under
the Securities Act).

COMMON STOCK

All shares of Common Stock now outstanding are fully paid and
non-assessable. The holders of Common Stock: (i) subject to preferences that may
be applicable to the Preferred Stock, have equal and ratable rights to dividends
from funds legally available for distribution, when, as and if declared by the
Board of Directors of the Company; (ii) are entitled to share ratably in all of
the assets of the Company available for distribution to holders of Common Stock
upon liquidation, dissolution or winding up of the affairs of the Company; (iii)
do not have subscription or conversion rights (there are no redemption or
sinking fund provisions applicable to the Common Stock); and (iv) are entitled
to one vote for each share of Common Stock held on all matters as

62
<PAGE> 67

to which holders of Common Stock shall be entitled to vote. In any election of
directors, no holder of shares of Common Stock will be entitled to cumulate his
or her votes by giving one candidate more than one vote per share. The rights
and preferences of holders of Common Stock are subject to the rights of the
Preferred Stock currently issued and outstanding or issued and outstanding in
the future. In addition, each outstanding series of the Company's Preferred
Stock contains certain dividend rights, liquidation preferences, redemption and
voting rights.

PREFERRED STOCK

All shares of Preferred Stock now outstanding are fully paid and
non-assessable.

Series A Preferred Stock

The Series A Preferred Stock has the following rights and preferences:

Dividends. Commencing on November 2, 1996, the holders of shares of
Series A Preferred Stock are entitled to receive, when and as declared by
the Board of Directors of the Company out of funds legally available
therefor, cumulative dividends payable quarterly in cash or in kind at the
Company's option at a rate of 7% per annum, computed on the basis of $10.00
per share (the "Series A Stock Value"), before any dividends are set apart
for or paid on the Common Stock. Such dividends will accrue until paid,
whether or not declared by the Board of Directors and whether or not there
are funds legally available. Dividends paid in cash on the shares of Series
A Preferred Stock (or Series B Preferred Stock or Series C Preferred Stock,
which shall rank pari passu with the Series A Preferred Stock) in an amount
less than the total amount of such dividends shall be allocated pro rata so
that the total value of dividends paid on the Preferred Stock shall in all
cases bear to each other the same ratio that the total value of accrued and
unpaid dividends on the Series A Preferred Stock, the Series B Preferred
Stock and the Series C Preferred Stock bear to each other.

Without the written consent of the holders of two-thirds of the
outstanding shares of Series A Preferred Stock, the Company shall not
declare or make any cash distribution with respect to any shares of capital
stock of the Company unless all dividends on the shares of Series A
Preferred Stock shall have been paid or declared and set aside for payment.

Liquidation Preference. In the event of any liquidation, dissolution
or winding up of the Company, whether voluntary or involuntary, the holders
of shares of Series A Preferred Stock are entitled, before any amount is
payable to the holders of the Common Stock, to receive the Series A Stock
Value plus an amount equal to all unpaid dividends accrued to the date of
payment. In the event of such a liquidation, dissolution or winding up of
the Company, the Series A Preferred Stock will rank pari passu with the
Series B Preferred Stock and the Series C Preferred Stock. If, upon any
such liquidation, dissolution or winding up of the Company, the assets of
the Company, or proceeds thereof, distributed among the holders of Series A
Preferred Stock shall be insufficient to pay in full the aggregate
preferential amounts on all of the then outstanding shares of Series A
Preferred Stock, then such assets or proceeds will be distributed among
such holders of the Series A Preferred Stock equally and ratably in
proportion to the full liquidation preference to which each such holder is
entitled.

Redemption Rights. On the date six months after the payment of the
Notes in full in cash (the "Mandatory Redemption Date") the Company shall
redeem all of the shares of Series A Preferred Stock outstanding for $10.00
per share plus an amount equal to all accrued and unpaid dividends to the
date of redemption (the "Series A Redemption Price"), payable in cash.
Except as described below, upon the consummation of a Series A Qualifying
Offering (as defined in the immediately succeeding paragraph), the Company
shall redeem each share of Series A Preferred Stock, payable in cash, at
the Series A Redemption Price. Moreover, except as described below, upon a
Change of Control (as defined in the immediately succeeding paragraph),
each holder of shares of Series A Preferred Stock may elect to require the
Company to redeem all of such holder's shares of Series A Preferred Stock,
payable in cash, at the Series A Redemption Price. If, on a respective
redemption date, the funds of the Company legally available for redemption
of the Series A Preferred Stock (or Series B Preferred Stock or Series C
Preferred Stock, which shall rank pari passu with the Series A Preferred
Stock) are insufficient to

63
<PAGE> 68

redeem the total number of shares of Preferred Stock to be redeemed on such
date, the Company will use the funds legally available therefor to redeem
the maximum number of shares of Preferred Stock ratably among the holders
of such shares to be redeemed based upon their holdings of Preferred Stock.
In addition, the Company has the option to redeem shares of Series A
Preferred Stock at any time for an amount equal to the Series A Stock Value
plus all accrued dividends due thereon as of the date of redemption. The
Company may not redeem, under any circumstances, any shares of Series A
Preferred Stock until the Company pays the Notes in full in cash; if the
Company has not paid the Notes in full in cash on any redemption date, the
Company will redeem the shares of Series A Preferred Stock only after
payment of the Notes in full in cash.

A "Change of Control" means: (i) the merger or consolidation of the
Company with or into another person or any person shall consolidate with or
merge into the Company; (ii) the transfer of all or substantially all of
the Company's assets; (iii) a reorganization, share exchange or
reclassification; or (iv) an acquisition or purchase such that any person
beneficially owns more than 50% of the Company's Common Stock or more than
50% of the Company's voting stock as a result of the acquisition or
purchase. A "Series A Qualifying Offering" means: (i) the Company shall
have consummated a firm commitment underwritten public offering of its
Common Stock by a nationally recognized investment banking firm pursuant to
an effective registration statement under the Securities Act of 1933, as
amended, resulting in gross proceeds to the Company of at least
$20,000,000; (ii) the Company's Common Stock is quoted or listed by The
Nasdaq National Market, the New York Stock Exchange or the American Stock
Exchange; and (iii) the price of the Company's Common Stock in the offering
is at least equal to 200% of the Series A Redemption Price or would
represent a compound annual rate of return of 35% based upon the initial
issuance price of the Series A Preferred Stock.

Voting. Unless otherwise provided by law or except as indicated
below, holders of the Series A Preferred Stock have no voting rights with
respect to the election of directors of the Company or otherwise. Upon the
failure of the Company to redeem the Series A Preferred Stock on the
Mandatory Redemption Date, the holders of the Series A Preferred Stock
shall be entitled to one vote for each share of Series A Preferred Stock
and shall be entitled to vote as a separate class only in respect of any
merger, consolidation, sale of assets or creation of any class or series
(other than the Series B Preferred Stock or Series C Preferred Stock) equal
to or superior to the Series A Preferred Stock. The holders of at least
two-thirds of the Series A Preferred Stock as a class have the right to
elect two directors of the Company.

Without the authorizing vote or consent of the holders of two-thirds
of the outstanding shares of Series A Preferred Stock, voting as a class,
the Company shall not: (i) amend, waive or repeal any provisions of (or add
any provision to) the Certificate of Designations authorizing the Series A
Preferred Stock, the Company's Certificate of Incorporation or any
certificates of designations with respect to the Company's preferred stock;
(ii) amend, waive or repeal any provisions of (or add any provision to) the
Company's Bylaws; (iii) authorize, create, issue or sell any stock having
preferential rights in the distribution of earnings or assets of the
Company prior to or on a parity with those of the outstanding Series A
Preferred Stock other than the Series B Preferred Stock or Series C
Preferred Stock; (iv) except under certain circumstances, issue any shares
of Series A Preferred Stock; (v) enter into any agreements that restrict
the Company's obligation to pay dividends on or redeem the shares of Series
A Preferred Stock; or (vi) dissolve the Company.

Other than the rights described above, the holders of the Series A
Preferred Stock have no preemptive, subscription, sinking fund or
conversion rights.

Series B Preferred Stock

The Series B Preferred Stock has the following rights and preferences:

Dividends. Commencing on January 31, 1997, the holders of shares of
Series B Preferred Stock are entitled to receive, when and as declared by
the Board of Directors of the Company out of funds legally available
therefor, cumulative dividends payable in cash or to accrue quarterly at a
rate of $0.7651 (7%) per share per annum ($0.9837 (9%) per share per annum
upon an Event of Default), before any

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dividends are set apart for or paid on the Common Stock. Dividends paid in
cash on the shares of Series B Preferred Stock (or Series A Preferred Stock
or Series C Preferred Stock, which shall rank pari passu with the Series B
Preferred Stock) in an amount less than the total amount of such dividends
shall be allocated pro rata so that the total value of dividends paid on
the Preferred Stock shall in all cases bear to each other the same ratio
that the total value of accrued and unpaid dividends on the Series A
Preferred Stock, the Series B Preferred Stock and the Series C Preferred
Stock bear to each other. An "Event of Default" shall mean: (i) any failure
by the Company to pay a cash dividend on the payment date, such failure
lasting for two (2) consecutive quarterly periods; (ii) failure by the
Company to satisfy its redemption obligations, such failure lasting five
(5) days beyond the redemption date; (iii) failure by the Company to comply
with its obligations upon liquidation, dissolution or winding up of the
Company and conversion of shares of Series B Preferred Stock; and regarding
anti-dilution adjustments, certain notice provisions and voting and
preemptive rights; (iv) a representation or warranty is untrue in the
Securities Purchase Agreement; (v) failure to comply with covenants in the
Securities Purchase Agreement; (vi) default by the Company in the
performance or observance of any obligation or condition with respect to
the indebtedness of the Company; or (vii) if the Company shall become
insolvent or bankrupt.

Without the written consent of the holders of two-thirds of the
outstanding shares of Series B Preferred Stock, the Company shall not
declare or make any cash distribution with respect to any other shares of
capital stock of the Company unless all dividends on the shares of Series B
Preferred Stock shall have been paid or declared and set aside for payment.

Liquidation Preference. In the event of any liquidation, dissolution
or winding up of the Company, whether voluntary or involuntary, the holders
of Series B Preferred Stock are entitled, before any amount is payable to
the holders of the Common Stock or any other class or series of stock
ranking junior to the Series B Preferred Stock, to receive $10.93 per share
plus an amount equal to all accrued and unpaid dividends to the date of
payment. In the event of such a liquidation, dissolution or winding up of
the Company, the Series B Preferred Stock will shall rank pari passu with
the Series A Preferred Stock and the Series C Preferred Stock. If, upon any
such liquidation, dissolution or winding up of the Company, the assets of
the Company, or proceeds thereof, distributed among the holders of Series B
Preferred Stock shall be insufficient to pay in full the aggregate
preferential amounts on all of the then outstanding shares of Series B
Preferred Stock, then such assets or proceeds will be distributed among
such holders of Preferred Stock equally and ratably in proportion to the
full respective liquidation preference to which each such holder is
entitled.

Conversion. Each holder of Series B Preferred Stock has the right to
convert such holder's shares of Series B Preferred Stock into shares of
Common Stock at any time. Each share of Series B Preferred Stock is
initially convertible into one share of Common Stock. The number of shares
of Common Stock into which a share of Series B Preferred Stock is
convertible will be equal to the ratio of the original purchase price of
$10.93, divided by the conversion price, which initially will be $8.00.
Under the antidilution provisions, the conversion price of the Series B
Preferred Stock will be subject to adjustment in the event of (i) any
subdivision or combination of the Company's outstanding Common Stock; (ii)
a dividend to holders of Common Stock payable in Common Stock; or (iii) the
issuance of additional shares of Common Stock or warrants or rights to
purchase Common Stock or securities convertible into Common Stock in
certain circumstances. The conversion price of Series B Preferred Stock
also will be adjusted on a "weighted average" basis upon the Company's
issuance of additional shares of Common Stock or warrants or rights to
purchase Common Stock or securities convertible into Common Stock for a
consideration per share which is less than the greater of the Fair Market
Price (as defined below) in effect immediately prior to such issue or the
conversion price in effect immediately prior to such issue. The "Fair
Market Price" means the average closing bid price of the Common Stock as
reported by The Nasdaq National Market (or the last sale price if traded on
an exchange) for a period of thirty (30) consecutive trading days ending on
the third day prior to the date of determination or (if the Common Stock is
not quoted on The Nasdaq National Market or listed on an exchange) the fair
market value determined by two-thirds of the Corporation's Board of
Directors, or (if the Board of Directors cannot reach agreement), as
determined by a qualified independent investment banking firm of national

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reputation appointed by the vote of two-thirds of the Board of Directors.
The conversion price of the Series B Preferred Stock will not be adjusted
for issuances of Common Stock upon the conversion of the Series B Preferred
Stock, up to 800,000 shares of Common Stock issuable upon the exercise of
options issued to officers, directors and employees of the Company, up to
186,750 shares of Common Stock issuable upon exercise of the warrant
granted to BT Alex. Brown Incorporated in connection with the offer and
sale of the Series C Preferred Stock, or up to 505,375 shares of Common
Stock issuable upon exercise of warrants granted to certain lenders and
guarantors or purchasers of loans to the Company under certain
circumstances.

In the event of (i) any consolidation, merger or similar business
combination of the Company, (ii) a capital reorganization of the Company or
(iii) a reclassification of the Common Stock, and the holders of the Series
B Preferred Stock have elected not to require redemption of their shares,
the Series B Preferred Stock then outstanding will thereafter be
convertible, at the option of the holder, into the kind and number of
shares of Common Stock or other securities or property (including cash) to
which the holders thereof would have been entitled if such holders had
converted such shares of Series B Preferred Stock into Common Stock
immediately prior to the effective date of such merger, consolidation,
disposition, reorganization or reclassification.

Each share of Series B Preferred Stock automatically will convert into
fully paid and nonassessable shares of Common Stock at the conversion rate,
upon the occurrence of a Series B Qualifying Offering. A "Series B
Qualifying Offering" means (i) the Corporation shall have consummated a
firm commitment underwritten public offering of its Common Stock by a
nationally recognized investment banking firm pursuant to an effective
registration under the Securities Act covering the offering and sale of
both primary and secondary shares of Common Stock which results in gross
proceeds of at least $20,000,000, (ii) the Common Stock is quoted or listed
on either The Nasdaq National Market, the New York Stock Exchange or the
American Stock Exchange, (iii) the price at which the Common Stock is sold
in such offering is at least equal to an amount which (a) is 200% of the
then effective conversion price of the Series B Preferred Stock or (b)
would represent, on an as converted basis, a compound annual rate of return
of 35% based upon the original issuance price of the Series B Preferred
Stock.

Redemption Rights. On the date six months after the payment of the
Notes in full in cash, the Company shall redeem all of the shares of Series
B Preferred Stock outstanding for $10.93 per share plus an amount equal to
all accrued and unpaid dividends to the date of redemption (the "Series B
Redemption Price"), payable in cash. Except as described below, upon a
Change of Control (as defined in "Description of Capital Stock -- Preferred
Stock -- Series A Preferred Stock"), the Company shall redeem each share of
Series B Preferred Stock, payable in cash, at the Series B Redemption
Price. If on a respective redemption date, the funds of the Company legally
available for redemption of the Series B Preferred Stock (or Series A
Preferred Stock or Series C Preferred Stock, which shall rank pari passu
with the Series B Preferred Stock) are insufficient to redeem the total
number of shares of Preferred Stock to be redeemed on such date, the
Company will use the funds legally available therefor to redeem the maximum
number of shares of Preferred Stock ratably among the holders of such
shares to be redeemed based upon their holdings of Preferred Stock. The
Company may not redeem, under any circumstances, any shares of Series B
Preferred Stock until the Company pays the Notes in full in cash; if the
Company has not paid the Notes in full in cash on any redemption date, the
Company will redeem the shares of Series B Preferred Stock only after
payment of the Notes in full in cash.

Voting. Holders of shares of Series B Preferred Stock shall be
entitled to the number of votes equal to the number of full shares of
Common Stock into which such shares of Series B Preferred Stock is then
convertible. Unless otherwise required by law or except as described below,
the Series B Preferred Stock and the Common Stock shall vote together on
each matter submitted to stockholders, and not by class or series.

Prior to the consummation of a Series B Qualifying Offering, the
holders of the Series B Preferred Stock, voting together as a class, shall
be entitled to elect one director of the Company. Subsequent to a Series B
Qualifying Offering and only so long as at least 66 2/3% of the Common
Stock issuable upon the

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conversion of the Series B Preferred Stock is held of record by the
original purchasers of such stock, the holders of a majority of the shares
of Common Stock issuable upon conversion of the Series B Preferred Stock
shall be entitled to nominate one person for election as a director of the
Company and the Company will include such person in management's slate of
nominees for election as directors. Upon the occurrence of an Event of
Default, the holders of the Series B Preferred Stock, together with the
holders of the Series C Preferred Stock, have the exclusive right to elect
a majority of the Board of Directors.

Without the authorizing vote or consent of the holders of two-thirds
of the outstanding shares of Series B Preferred Stock, voting as a class,
the Company shall not: (i) amend, waive or repeal any provisions of (or add
any provision to) the Certificate of Designations authorizing the Series B
Preferred Stock, the Company's Certificate of Incorporation or any
certificates of designations with respect to the Company's preferred stock;
(ii) amend, waive or repeal any provisions of (or add any provision to) the
Company's Bylaws; (iii) authorize, create, issue or sell any stock having
preferential rights in the distribution of earnings or assets of the
Company prior to or on a parity with those of the outstanding Series B
Preferred Stock other than shares of Series A Preferred Stock or Series C
Preferred Stock; (iv) except under certain circumstances, issue any shares
of Series B Preferred Stock; (v) enter into any agreements that restrict
the Company's obligation to pay dividends on or redeem the Series B
Preferred Stock; or (vi) dissolve the Company.

Without the authorizing vote of the holders of ninety percent (90%) of
the outstanding Series B Preferred Stock, voting as a class, the Company
shall not amend the Company's Certificate of Incorporation or the
Certificate of Designations creating the Series B Preferred Stock to change
(i) the dividend rate, (ii) redemption provisions, (iii) anti-dilution
provisions, (iv) the place or currency of payments with respect to the
Series B Preferred Stock, (v) the right to institute suit for payment, (vi)
conversion rights, or (vii) voting rights to adversely affect the
foregoing.

Preemptive Rights. Except pursuant to a Series B Qualifying Offering,
a stock option plan approved by the Company's Board of Directors, as a form
of consideration in a merger or acquisition in which the Company is the
surviving entity, or where the aggregate gross proceeds are less than
$500,000 in any single transaction in which the sale price per share is not
less than the then-applicable conversion price of the Series B Preferred
Stock, or $1,500,000 in all of such transactions, the Company shall not
issue or sell any shares of Common Stock, Preferred Stock or other
securities convertible into or exchangeable for shares of Common Stock,
unless prior to such issuance or sale, in the same proportion as the number
of shares of Common Stock issuable upon conversion of the Series B
Preferred Stock bears to the total number of fully-diluted shares of Common
Stock outstanding, the holders of the Series B Preferred Stock shall have
been given the opportunity to purchase such securities on the same terms as
such securities are proposed to be sold. The holders of two-thirds of the
Series B Preferred Stock may waive the preemptive rights afforded to the
holders of Series B Preferred Stock.

Series C Preferred Stock

The Series C Preferred Stock has the following rights and preferences:

Dividends. Commencing on August 31, 1997, the holders of Series C
Preferred Stock will be entitled to receive, when and as declared by the
Board of Directors of the Company out of funds legally available therefor,
cumulative dividends payable in cash or to accrue quarterly at a rate of
$0.56 (7%) per share per annum ($0.72 (9%) upon an Event of Default) before
any dividends are set apart for or paid on the Common Stock or on any prior
series of Preferred Stock. Dividends paid in cash on the shares of Series C
Preferred Stock (or Series A Preferred Stock or Series B Preferred Stock,
which shall rank pari passu with the Series C Preferred Stock) in an amount
less than the total amount of such dividends shall be allocated pro rata so
that the total value of dividends paid on the Preferred Stock shall in all
cases bear to each other the same ratio that the total value of accrued and
unpaid dividends on the Series A Preferred Stock, the Series B Preferred
Stock and the Series C Preferred Stock bear to each other.

Without the written consent of the holders of two-thirds of the
outstanding shares of Series C Preferred Stock, the Company shall not
declare or make any cash distribution with respect to any other

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shares of capital stock of the Company unless all dividends on the shares
of Series C Preferred Stock shall have been paid or declared and set aside
for payment.

Liquidation Preference. In the event of any liquidation, dissolution
or winding up of the Company, whether voluntary or involuntary, the holders
of Series C Preferred Stock are entitled, before any amount is payable to
the holders of the Common Stock or any other class or series of stock
ranking junior to the Series C Preferred Stock, to receive $8.00 per share
plus an amount equal to all accrued and unpaid dividends to the date of
payment. In the event of such a liquidation, dissolution or winding up of
the Company, the Series C Preferred Stock will shall rank pari passu with
the Series A Preferred Stock and the Series B Preferred Stock. If, upon any
such liquidation, dissolution or winding up of the Company, the assets of
the Company, or proceeds thereof, distributed among the holders of Series C
Preferred Stock shall be insufficient to pay in full the aggregate
preferential amounts on all of the then outstanding shares of Series C
Preferred Stock, then such assets or proceeds will be distributed among
such holders of Preferred Stock equally and ratably in proportion to the
full respective liquidation preference to which each such holder is
entitled.

Conversion. Each holder of Series C Preferred Stock has the right to
convert such holder's shares of Series C Preferred Stock into shares of
Common Stock at any time. Each share of Series C Preferred Stock is
initially convertible into one share of Common Stock. The number of shares
of Common Stock into which a share of Series C Preferred Stock is
convertible will be equal to the ratio of the original purchase price of
$8.00, divided by the conversion price, which initially will be $8.00.
Under the antidilution provisions, the conversion price of the Series C
Preferred Stock will be subject to adjustment in the event of (i) any
subdivision or combination of the Company's outstanding Common Stock; (ii)
a dividend to holders of Common Stock payable in Common Stock; or (iii) the
issuance of additional shares of Common Stock or warrants or rights to
purchase Common Stock or securities convertible into Common Stock in
certain circumstances. The conversion price of Series C Preferred Stock
also will be adjusted on a "weighted average" basis upon the Company's
issuance of additional shares of Common Stock or warrants or rights to
purchase Common Stock or securities convertible into Common Stock for a
consideration per share which is less than the greater of the Fair Market
Price in effect immediately prior to such issue or the conversion price in
effect immediately prior to such issue. The "Fair Market Price" means (i)
prior to the first anniversary of the initial issuance of the Series C
Preferred Stock, $8.00; and (ii) after the first anniversary of the initial
issuance of the Series C Preferred Stock, the average closing bid price of
the Common Stock as reported by The Nasdaq National Market (or the last
sale price if traded on an exchange) for a period of thirty (30)
consecutive trading days ending on the third day prior to the date of
determination or (if the Common Stock is not quoted on The Nasdaq National
Market or listed on an exchange) the fair market value determined by
two-thirds of the Corporation's Board of Directors, or (if the Board of
Directors cannot reach agreement), as determined by a qualified independent
investment banking firm of national reputation appointed by the vote of
two-thirds of the Board of Directors. The conversion price of the Series C
Preferred Stock will not be adjusted for issuances of Common Stock upon the
conversion of the Series C Preferred Stock, up to 800,000 shares of Common
Stock issuable upon the exercise of options issued to officers, directors
and employees of the Company, up to 186,750 shares of Common Stock issuable
upon exercise of the warrant granted to BT Alex. Brown in connection with
the offer and sale of the Series C Preferred Stock, or up to 505,375 shares
of Common Stock issuable upon exercise of warrants granted to certain
lenders and guarantors or purchasers of loans to the Company under certain
circumstances.

The conversion price of the Series C Preferred Stock also will be
adjusted if the Company reports earnings before interest, taxes,
depreciation, and amortization, as determined in accordance with generally
accepted accounting principles ("EBITDA") for the fiscal year ending June
30, 2000 (the "Period"), of less than $27,614,500. If the Company reports
EBITDA for the Period of less than or equal to $16,568,700, then the
conversion price of the Series C Preferred Stock will be reduced to equal
$5.00. If the Company reports EBITDA for the Period of less than
$27,614,500, but more than $16,568,700, then the conversion price of the
Series C Preferred Stock will be reduced to equal: (i) the then-current
conversion price, less (ii) the product of (A) a fraction, the numerator of
which will be $27,614,500,

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minus the EBITDA reported by the Company for the Period, and the
denominator of which will be $27,614,500, minus $16,568,700, multiplied by
(B) the then-current conversion price minus $5.00. However, the adjustments
of the conversion price of the Series C Preferred Stock based on the EBITDA
for the Period will not result in a reduction of the conversion price to
less than $5.00.

In addition to the foregoing, if, on or before December 31, 2000, the
Company sells all or substantially all of its assets, merges or
consolidates with any other business entity where the Company is not the
surviving Company, or completes a public offering of the Company's Common
Stock pursuant to an effective registration under the Securities Act of
1933, as amended, then (i) the adjustments based on the EBITDA reported for
the Period, as described in the preceding paragraph, will terminate
immediately and be of no effect, and (ii) if necessary to cause the holders
of the Series C Preferred Stock to obtain an internal rate of return of
35%, calculated as if each such holder purchased such shares of Series C
Preferred Stock at the purchase price per paid by such holder on the date
such holder purchased such shares, the then-current conversion price will
be reduced concurrently with any such transaction to an amount that results
in the holders of the Series C Preferred Stock obtaining such an internal
rate of return.

In the event of (i) any consolidation, merger or similar business
combination of the Company, (ii) a capital reorganization of the Company or
(iii) a reclassification of the Common Stock, and the holders of the Series
C Preferred Stock have elected not to require redemption of their shares,
the Series C Preferred Stock then outstanding will thereafter be
convertible, at the option of the holder, into the kind and number of
shares of Common Stock or other securities or property (including cash) to
which the holders thereof would have been entitled if such holders had
converted such shares of Series C Preferred Stock into Common Stock
immediately prior to the effective date of such merger, consolidation,
disposition, reorganization or reclassification.

Each share of Series C Preferred Stock will automatically convert into
fully paid and nonassessable shares of Common Stock at the conversion rate,
upon the occurrence of a Series C Qualifying Offering. A "Series C
Qualifying Offering" means (i) the Corporation shall have consummated a
firm commitment underwritten public offering of its Common Stock by a
nationally recognized investment banking firm pursuant to an effective
registration under the Securities Act covering the offering and sale of
both primary and secondary shares of Common Stock which results in gross
proceeds of at least $20,000,000, (ii) the Common Stock is quoted or listed
on either The Nasdaq National Market, the New York Stock Exchange or the
American Stock Exchange, (iii) the price at which the Common Stock is sold
in such offering is at least equal to an amount which (a) is 200% of the
then effective conversion price of the Series C Preferred Stock or (b)
would represent, on an as converted basis, a compound annual rate of return
of 35% based upon the original issuance price of the Series C Preferred
Stock.

Redemption Rights. On the date six months after the payment of the
Notes in full in cash, the Company shall redeem all of the Shares of Series
C Preferred Stock outstanding for $8.00 per share plus an amount equal to
all unpaid dividends accrued to the date of redemption (the "Series C
Redemption Price"), payable in cash. Except as described below, upon a
Change of Control (as defined in "Description of Capital Stock -- Preferred
Stock -- Series A Preferred Stock"), the Company shall redeem each share of
Series C Preferred Stock, payable in cash, at the Series C Redemption
Price. If on a respective redemption date, the funds of the Company legally
available for redemption of the Series C Preferred Stock (or Series A
Preferred Stock or Series B Preferred Stock, which shall rank pari passu
with the Series C Preferred Stock) are insufficient to redeem the total
number of shares of Preferred Stock to be redeemed on such date, the
Company will use the funds legally available therefor to redeem the maximum
number of shares of Preferred Stock ratably among the holders of such
shares to be redeemed based upon their holdings of Preferred Stock. The
Company may not redeem, under any circumstances, any shares of Series C
Preferred Stock until the Company pays the Notes in full in cash; if the
Company has not paid the Notes in full in cash on any redemption date, the
Company will redeem the shares of Series C Preferred Stock only after
payment of the Notes in full in cash.

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Voting. Holders of shares of Series C Preferred Stock shall be
entitled to the number of votes equal to the number of full shares of
Common Stock into which such share of Series C Preferred Stock is then
convertible. Unless otherwise required by law or except as described below,
the Series C Preferred Stock and the Common Stock shall vote together on
each matter submitted to stockholders, and not by class or series.

Prior to the consummation of a Series C Qualifying Offering, the
holders of the Series C Preferred Stock, voting together as a class, shall
be entitled to elect one director of the Company. Subsequent to a Series C
Qualifying Offering and only so long as at least 66 2/3% of the Common
Stock issuable upon the conversion of the Series C Preferred Stock is held
of record by the original purchasers of such stock, the holders of a
majority of the Common Stock issuable upon conversion of the Series C
Preferred Stock shall be entitled to nominate one person for election as a
director of the Company and the Company will include such person in
management's slate of nominees for election as directors. Upon the
occurrence of an Event of Default, the holders of the Series C Preferred
Stock, together with the holders of the Series B Preferred Stock, have the
exclusive right to elect a majority of the Board of Directors.

Without the authorizing vote or consent of the holders of two-thirds
of the outstanding shares of Series C Preferred Stock, voting as a class,
the Company shall not: (i) amend, waive or repeal any provisions of (or add
any provision to) the Certificate of Designations authorizing the Series C
Preferred Stock, the Company's Certificate of Incorporation or any
certificates of designations with respect to the Company's preferred stock;
(ii) amend, waive or repeal any provisions of (or add any provision to) the
Company's Bylaws; (iii) authorize, create, issue or sell any stock having
preferential rights in the distribution of earnings or assets of the
Company prior to or on a parity with those of the outstanding Series C
Preferred Stock; (iv) except under certain circumstances, issue any
additional shares of Series C Preferred Stock; (v) enter into any
agreements that restrict the Company's obligation to pay dividends on or
redeem the shares of Series C Preferred Stock; or (vi) dissolve the
Company.

Without the authorizing vote of the holders of ninety percent (90%) of
the outstanding Series C Preferred Stock, voting as a class, the Company
shall not amend the Company's Certificate of Incorporation or the
Certificate of Designations creating the Series C Preferred Stock to change
(i) the dividend rate, (ii) redemption provisions, (iii) anti-dilution
provisions, (iv) the place or currency of payments with respect to the
Series C Preferred Stock, (v) the right to institute suit for payment, (vi)
conversion rights, or (vii) voting rights to adversely affect the
foregoing.

Preemptive Rights. Except pursuant to a Series C Qualifying Offering,
a stock option plan approved by the Company's Board of Directors, as a form
of consideration in a merger or acquisition in which the Company is the
surviving entity, or where the aggregate gross proceeds are less than
$500,000 in any single transaction in which the sale price per share is not
less than the then-applicable conversion price of the Series C Preferred
Stock, or $1,500,000 in all of such transactions, the Company shall not
issue or sell any shares of Common Stock, Preferred Stock or other
securities convertible into or exchangeable for shares of Common Stock,
unless prior to such issuance or sale, in the same proportion as the number
of shares of Common Stock issuable upon conversion of the Series C
Preferred Stock bears to the total number of fully-diluted shares of Common
Stock outstanding, the holders of the Series C Preferred Stock shall have
been given the opportunity to purchase such securities on the same terms as
such securities are proposed to be sold. The holders of two-thirds of the
Series C Preferred Stock may waive the preemptive rights afforded to the
holders of Series C Preferred Stock.

RIGHTS OF FIRST REFUSAL AND CO-SALE

Rights of First Refusal. Certain holders of Preferred Stock and Common
Stock have rights of first refusal with respect to proposed sales of stock by
the Company or by certain holders of shares of the Common Stock.

Pursuant to rights of first refusal, if the Company proposes to sell any
shares of Common Stock, Preferred Stock or other securities convertible into or
exchangeable for shares of Common Stock, other than any issuance or sale (i)
pursuant to a Series B Qualifying Offering or Series C Qualifying Offering, (ii)
pursuant

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to a stock option plan approved by the Board of Directors, (iii) as a form of
consideration in connection with a merger or acquisition where the Company is
the surviving entity or (iv) where the aggregate gross proceeds are less than
$500,000 in any single transaction (provided that the sale price per share is
not less than the then-applicable conversion price of the Series B Preferred
Stock or Series C Preferred Stock, and provided further that the aggregate gross
proceeds of all such transactions shall not exceed $1,500,000 (the "Subject
Shares"), then the Company must first offer to sell the Subject Shares to the
holders of Common Stock and Series B Preferred Stock and Series C Preferred
Stock upon the same terms and conditions as the proposed sale. If such holders
do not purchase all of such Subject Shares to which they are entitled, then the
other holders of Common Stock, Series B Preferred Stock and Series C Preferred
Stock shall have the right to purchase their pro rata portion of the subject
shares which such holders did not elect to purchase. If such holders of Common
Stock, Series B Preferred Stock and Series C Preferred Stock do not collectively
elect to purchase all of the Subject Shares, the Company may proceed to sell or
assign the Subject Shares not purchased by such holders to the proposed
transferee on the same terms offered the holders within three months after the
30 day period in which the holders of Common Stock, Series B Preferred Stock and
Series C Preferred Stock could have elected to purchase the Subject Shares.

Pursuant to rights of first refusal, if certain holders of Common Stock
propose to sell any or all of such holder's Common Stock, other than any sale in
the event of a public offering, merger, consolidation or exchange of securities
of the Company approved by the stockholders of the Company, then the holder of
Common Stock must first offer to sell such shares of Common Stock to the other
holders of the Company's Common Stock and the holders of the Series A Preferred
Stock upon the same terms and conditions as the proposed sale. If such holders
of Common Stock and Series A Preferred Stock do not individually or collectively
elect to purchase all of such shares of Common Stock, then the selling holder of
Common Stock must notify the other holders of the Company's Common Stock and the
holders of the Series A Preferred Stock of the number of shares of Common Stock
that remain to be sold to the prospective purchaser. Each holder of the
Company's Common Stock then will have, for a period of twenty days after the
date of such notice, the pro rata right (in proportion to their respective
ownership percentages of Common Stock) to purchase the remaining shares. The
holders of Series B Preferred Stock and Series C Preferred Stock do not have
rights equivalent to the rights of first refusal described in this paragraph.

Rights of Co-Sale. The current holders of the Company's outstanding shares
of Common Stock have certain co-sale rights. As noted above, pursuant to rights
of first refusal, if a holder of Common Stock proposes to sell any or all of
such holder's Common Stock, other than any sale in the event of a public
offering, merger, consolidation or exchange of securities of the Company
approved by the stockholders of the Company, then the holder of Common Stock
must first offer to sell such shares of Common Stock to the other holders of the
Company's Common Stock and the holders of the Series A Preferred Stock upon the
same terms and conditions as the proposed sale. If such holders of Common Stock
and Series A Preferred Stock do not individually or collectively elect to
purchase all of such shares of Common Stock, then the selling holder of Common
Stock must notify the other holders of the Company's Common Stock and the
holders of the Series A Preferred Stock of the number of shares of Common Stock
that remain to be sold to the prospective purchaser. Each holder of the
Company's Common Stock then will have, for a period of twenty days after the
date of such notice, the pro rata right (in proportion to their respective
ownership percentages of Common Stock) to sell, instead of the holder of Common
Stock, shares of Common Stock to the proposed purchaser on the same terms and
conditions as the proposed seller of Common Stock. The holders of Series B
Preferred Stock and Series C Preferred Stock do not have rights equivalent to
the rights of co-sale described in this paragraph.

The holders of the Company's outstanding shares of Series B Preferred and
Series C Preferred Stock have certain co-sale rights. If a current holder of
shares of the Company's outstanding Common Stock proposes to sell shares of
Common Stock (other than shares of Common Stock issuable upon the conversion of
Series B Preferred Stock or Series C Preferred Stock), the holders of Series B
Preferred Stock and Series C Preferred Stock will have the pro rata right (in
proportion to their respective ownership percentages of the Company's total
outstanding shares on an as-converted to Common Stock basis) to sell, instead of
the holder of Common Stock, shares of Common Stock (issuable upon conversion of
their Series B Preferred Stock or

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Series C Preferred Stock) to the proposed purchaser on the same terms and
conditions as the Common Stock holder's proposed sale. The co-sale rights
terminate upon a Series B Qualifying Offering or a Series C Qualifying Offering,
the consolidation, merger or capital reorganization of the Company, the sale,
lease or transfer by the Company of all or substantially all of its assets, or a
reclassification of the Company's outstanding shares of Common Stock, the date
on which those who purchased the Series B Preferred Stock pursuant to the Stock
Purchase Agreement dated as of November 13, 1996, or their affiliates, cease to
own of record 50% or more of the Series B Preferred Stock (or shares of Common
Stock into which such Series B Preferred Stock may have been converted)
purchased pursuant to such agreement, or the date on which those who purchased
the Series C Preferred Stock pursuant to the Stock Purchase Agreement dated as
of August 22, 1997, or their affiliates, cease to own of record 50% or more of
the Series C Preferred Stock (or shares of Common Stock into which such Series C
Preferred Stock may have been converted) purchased pursuant to such agreement.

WARRANTS

In addition to the Warrants, the Company has granted warrants to purchase
an aggregate of 280,399 shares of Common Stock, all having an exercise price of
$8.00 per share, including presently exercisable warrants to purchase 100,399
shares of Common Stock granted to BT Alex. Brown Incorporated in connection with
the offer and sale of the Series C Preferred Stock. The exercise price and the
number of shares of the Common Stock for which the warrants may be exercised are
subject to adjustment in the event of any subdivision or combination of the
Company's outstanding Common Stock, a dividend to holders of Common Stock
payable in Common Stock or the issuance of additional shares of Common Stock in
certain circumstances.

CERTAIN PROVISIONS OF THE CERTIFICATES OF DESIGNATIONS, BYLAWS AND DELAWARE LAW

The Company's Bylaws contain certain provisions that may have the effect of
rendering more difficult certain possible takeover proposals to acquire control
of the Company and of making removal of management of the Company more
difficult. Pursuant to the Company's Bylaws, only a director may call a special
meeting of the stockholders of the Company. In addition, the Certificates of
Designations creating the Series A Preferred Stock, the Series B Preferred
Stock, and the Series C Preferred Stock each provide for the immediate
redemption of the Series A Preferred Stock, the Series B Preferred Stock and the
Series C Preferred Stock upon a Change of Control (as discussed above). However,
in the event of such a Change of Control prior to the payment in full in cash of
the Notes, the Company may not redeem any shares of Series A Preferred Stock,
Services B Preferred Stock or Series C Preferred Stock until the Notes are paid
in full in cash. In such event, the Company must redeem the shares of Series A
Preferred Stock, Series B Preferred Stock and Series C Preferred Stock
immediately after payment of the Notes in full in cash.

REGISTRATION RIGHTS

The Company has granted certain registration rights to the holders of
shares of Common Stock held by the Patricof Managed Funds and to holders of the
shares of Common Stock issuable upon conversion of the Series B Preferred Stock,
the Series C Preferred Stock and the exercise of the warrants granted to BT
Alex. Brown Incorporated, and any additional shares of Common Stock acquired as
a result of a stock dividend, stock split or other distribution in respect of
the Series B Preferred Stock or the Series C Preferred Stock (all such shares,
together, the "Registrable Securities").

At any time and from time to time after January 1, 1999, holders of
Registrable Securities will be entitled to demand that the Company on three
occasions register the resale of Registrable Securities under the Securities Act
(a "Demand Registration"). Such demand must be made by the holders of the lesser
of at least 25% of the Registrable Securities or of Registrable Securities
having a minimum aggregate offering price of $7,500,000 (the "Minimum Offering
Price"). An offering pursuant to any Demand Registration may be in the form of
an underwritten offering. In addition to the foregoing demand rights, if the
resale of the Registrable Securities may be registered on Form S-3, the holders
of Registrable Securities are entitled to require the

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Company to so register the Registrable Securities once per year without regard
to the Minimum Offering Price or the aggregate number of such registrations.

In addition, the Company is required to give notice to holders of the
Registrable Securities of its filing of a registration statement (other than on
Form S-4 or Form S-8) for its own account or the account of another stockholder
of the Company and to offer such holders the opportunity to include Registrable
Securities on such registration statement subject to the compliance by any such
holder with certain notice conditions (a "Piggyback Registration"). In the event
the offering pursuant to such registration statement is an underwritten one, the
Company will use its reasonable best efforts to cause the managing underwriter
to permit the Registrable Securities to be included.

The Company shall be responsible for all expenses in connection with all of
the foregoing registrations, other than underwriting discounts and commissions,
except under certain limited circumstances.

If, in an underwritten offering pursuant to a Demand Registration, the
managing underwriter requires cutbacks of the number of shares of Common Stock
to be included in the offering, the number of shares to be offered for the
account of the Company or any other person (other than the holders of
Registrable Securities) participating in such offering will be reduced or
limited pro rata in proportion to the respective number of shares requested to
be registered. If, in an underwritten offering pursuant to a Piggyback
Registration, the managing underwriter requires cutbacks of the number of shares
of Common Stock to be included in the offering, cutbacks shall be made in the
following order (i) shares of Common Stock to be offered by holders of Common
Stock other than the holders of Registrable Securities, to the extent necessary
to reduce the total number of shares as recommended by the managing underwriter
and (ii) if further reduction is necessary, shares held by the holders of
Registrable Securities shall be reduced on a pro rata basis in proportion to the
relative number of Registrable Securities of the holders of Registrable
Securities participating in such offering. If an offering pursuant to a Demand
Registration is not an underwritten offering, neither the Company nor any
stockholder of the Company (other than the holders of Registrable Securities)
shall be permitted to include securities in such offering without the consent of
the holders of Registrable Securities being offered pursuant to such Demand
Registration.

All holders of Registrable Securities agree not to make any sale of
Registrable Shares within a period of up to 180 days prior to or following the
effective date of a registration statement of the Company filed under the
Securities Act, except for Common Stock included in the registration and unless
otherwise permitted by the Company or such underwriter.

In addition to the registration rights granted to the holders of
Registrable Securities, the Company also has granted certain registration rights
to the holder of a warrant to purchase up to 180,000 shares of the Company's
Common Stock. The Company is required to give notice to the holder of the
warrant of the Company's filing of a registration statement (other than on Form
S-4 or Form S-8) for its own account or the account of another stockholder of
the Company and to offer to the holder of the warrant the opportunity to include
on such registration statement shares of the Company's Common Stock issuable
upon exercise of the warrant, subject to the compliance by the holder of the
warrant with certain conditions, including the exercise of the warrant by the
holder of the warrant for at least the number of shares of the Company's Common
Stock being registered. In the event the offering pursuant to such registration
statement is an underwritten one and the managing underwriter requires cutbacks
of the number of shares of Common Stock to be included in the offering, then the
number of shares of Common Stock to be included in the offering by the holder of
the warrant will be reduced pro rata based on the number of shares of Common
Stock which each selling stockholder (other than the holders of the Registrable
Securities) has requested to include in the registration statement. The
registration rights granted to the holder of the warrant are subordinate to the
registration rights granted to the holders of the Registrable Securities.

CERTAIN APPOINTMENTS TO THE BOARD OF DIRECTORS

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members, (ii) as long as the Series A Preferred Stock has not been redeemed and
paid in full, the holders of the Series A Preferred Stock have the right to
designate two directors, (iv) the holders of the Series B Preferred Stock have
the right to designate one director, (iii) the holders of the Series C Preferred
Stock have the right to designate one director, (v) certain holders of the
Common Stock have the right to designate two directors, and (vi) the Board of
Directors and the holders of the Series B Preferred Stock and Series C Preferred
Stock will mutually agree upon the remaining director.

DESCRIPTION OF THE NOTES

On May 27, 1998, the Company issued an aggregate $75.0 million of its 13%
Senior Notes due 2008 pursuant to the Indenture. The terms of the Notes include
those stated in the Indenture and those made part of the Indenture by reference
to the Trust Indenture Act of 1939. The following summary of the material
provisions of the Indenture does not purport to be complete and is qualified in
its entirety by reference to the Indenture, including the definitions therein of
certain terms used below. The Indenture has been filed as an exhibit to the
Registration Statement and a copy is available as set forth under "Available
Information." The Notes mature on May 15, 2008. Interest on the Notes accrues at
the rate of 13% per annum and is payable semi-annually in arrears on May 15 and
November 15 of each year, commencing on November 15, 1998. The Notes represent
senior, unsecured obligations of the Company, rank pari passu in right of
payment with all existing and future senior indebtedness of the Company and rank
senior in right of payment to all existing and future subordinated indebtedness
of the Company.

The Company has placed $19.2 million of the net proceeds of the Unit
Offering in an escrow account that was used to purchase the Pledged Securities.
The escrow account and the Pledged Securities were pledged as security for
repayment of the first four interest payments on the Notes (estimated at
approximately $19.5 million) and, under certain circumstances, as security for
repayment of principal of the Notes. The Pledged Securities will be held by
State Street Bank and Trust Company as Escrow Agent under an Escrow Agreement
dated as of May 27, 1998 (the "Escrow Agreement") pending disbursement as
provided therein. The Escrow Agreement has been filed as an exhibit to the
Registration Statement and a copy is available as set forth under "Available
Information."

The Notes will not be redeemable prior to May 15, 2003. Thereafter, the
Notes will be redeemable at the option of the Company, in whole or in part, at
redemption prices set forth in the Indenture. Notwithstanding the foregoing,
prior to May 15, 2001, the Company, at its option, may redeem up to 35% of the
then outstanding Notes with the net proceeds of an Initial Public Equity
Offering of the Company, as defined in the Indenture, at a redemption price
equal to 113% of the principal amount thereof, plus accrued and unpaid interest
thereon to the redemption date; provided that not less than 65% in aggregate
principal amount of Notes remain outstanding immediately after any such
redemption. Upon the occurrence of a Change of Control (as defined in the
Indenture), each holder of the Notes will have the right to require the Company
to repurchase all or any part of such holder's Notes at an offer price in cash
equal to 101% of the aggregate principal amount thereof, plus accrued and unpaid
interest thereon to the date of purchase.

The Indenture contains certain covenants that limit the ability of the
Company and certain of its subsidiaries to, among other things, incur additional
indebtedness, pay dividends or make other distributions, repurchase equity
interests or subordinated indebtedness, make certain other restricted payments,
create certain liens, enter into certain transactions with affiliates, sell
assets, issue or sell equity interests or enter into certain mergers and
consolidations.

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FEDERAL INCOME TAX CONSIDERATIONS

The following discusses the material federal income tax considerations
relating to the purchase, ownership and disposition of the Warrants. The
discussion deals only with Warrants that are held as capital assets within the
meaning of Section 1221 of the Internal Revenue Code of 1986, as amended (the
"Code"), and does not address all of the tax consequences that may be relevant
to a purchaser of Warrants in light of the purchaser's particular circumstances.
In addition, the discussion does not address the federal income tax consequences
to holders subject to special treatment under the U.S. federal income tax laws,
such as purchasers who are not U.S. Holders (as defined below), brokers or
dealers in securities or currencies, certain securities traders, tax-exempt
entities, banks, thrifts and insurance companies. Further, the discussion does
not address any U.S. federal alternative minimum tax consequences, or any state,
local or foreign tax consequences relating to the purchase, ownership or
disposition of Warrants.

This discussion is based upon the Code, existing and proposed regulations
thereunder, and current administrative rulings and court decisions. All of the
foregoing are subject to change, possibly on a retroactive basis, and any such
change could alter the tax considerations discussed herein.

The following discussion applies only to purchasers of Warrants who are
"U.S. Holders." For purposes of this discussion, "U.S. Holder" generally means
(i) a citizen or resident of the United States, (ii) a corporation or
partnership created or organized in or under the laws of the United States or
any political subdivision thereof, (iii) an estate the income of which is
includible in its gross income for U.S. federal income tax purposes without
regard to its source or (iv) a trust if a court within the United States is able
to exercise primary supervision over its administration and one or more U.S.
persons have the authority to control all substantial decisions of the trust.

PROSPECTIVE PURCHASERS ARE URGED TO CONSULT THEIR TAX ADVISORS WITH RESPECT
TO THE FEDERAL INCOME TAX CONSIDERATIONS THAT MAY BE SPECIFIC TO THEM, AS WELL
AS WITH RESPECT TO ANY STATE, LOCAL OR FOREIGN TAX CONSIDERATIONS IN ACQUIRING,
HOLDING OR DISPOSING OF THE WARRANTS.

THE WARRANTS

Sale or Other Disposition of the Warrant

Generally, a U.S. Holder of Warrants will recognize gain or loss upon the
sale or exchange of the Warrants in an amount equal to the difference between
the amount realized on the sale and the holder's adjusted tax basis for the
Warrants. The adjusted tax basis of the Warrants for a U.S. Holder will
generally be equal to the purchase price paid for such Warrants (adjusted as
described below under "Adjustments under the Warrants"). Under section 1234 of
the Code, gain or loss attributable to the sale or exchange of an option to buy
or sell property is considered gain from the sale or exchange of property that
has the same character as the property to which the option relates. Because the
Warrants relate to Common Stock, gains or losses attributable to the sale or
exchange of the Warrants will generally constitute capital gains and losses if
the Common Stock would be a capital asset in the hands of the Warrant holder.
Such capital gains and losses will be long term if the Warrants have been held
for more than one year. U.S. Holders should contact their tax advisor for more
information regarding the particular capital gain tax rates applicable to their
sale or disposition of Warrants at any given time.

Exercise of the Warrants

The exercise of a Warrant will not result in a taxable event to the holder
of the Warrant (except with respect to cash, if any, paid by the Company in lieu
of the issuance of fractional shares of Common Stock). A U.S. Holder's tax basis
in the shares of Common Stock received upon exercise of a Warrant will be equal
to the sum of (a) such holder's basis in the Warrant and (b) the cash paid by
the holder upon exercise of the Warrant. The holding period for capital gain and
loss purposes for the shares of Common Stock acquired upon exercise of a Warrant
will not include the period during which the Warrant was held. If any cash is
received in lieu of fractional shares, the U.S. Holder will recognize gain or
loss, and the character and amount of gain or

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loss will be determined as if the holder had received such fractional shares and
then immediately sold such fractional shares back to the Company for cash.

If the exercise price of the Warrants is treated as de minimis for U.S.
federal income tax purposes, it is possible that the Warrants may be deemed to
have been exercised for tax purposes on the date on which they first became
exercisable or possibly on the date issued, regardless of whether they are
actually exercised on the date on which they are first exercisable. As a result,
it is possible that a U.S. Holder could be treated as holding Common Stock as of
such date, and the holding period of shares of Common Stock may be deemed to
have begun on the date on which the Warrants first became exercisable or
possibly on the date such Warrants were issued.

Expiration of the Warrants

Upon the expiration of an unexercised Warrant, a U.S. Holder will recognize
a loss equal to the adjusted tax basis of the Warrant in the hands of the
holder. Under section 1234 of the Code, the character of the loss realized upon
the failure to exercise an option is determined based on the character of the
property to which the option relates. Because the Warrants relate to Common
Stock, a loss realized upon expiration of a Warrant will generally be a capital
loss if the Common Stock would be a capital asset in the hands of the Warrant
holder. Such capital loss will be long term if the Warrant has been held for
more than one year.

Adjustments Under the Warrants

Pursuant to the terms of the Warrants, the number of shares that may be
purchased upon exercise of the Warrants is subject to adjustment from time to
time upon the occurrence of certain events. Under section 305 of the Code, a
change in conversion ratio or any transaction having a similar effect on the
interest of a Warrant holder may be treated as a distribution with respect to
any Warrant holder whose proportionate interest in the earnings and profits of
the Company is increased by such change or transaction. Thus, under certain
future circumstances which may or may not occur, such an adjustment pursuant to
the terms of the Warrants may be treated as a taxable distribution to the
Warrant holders to the extent of the Company's current or accumulated earnings
and profits, without regard to whether the Warrant holders receive any cash or
other property. If the Warrant holders receive such a taxable distribution their
tax bases in the Warrants will be increased by an amount equal to the taxable
distribution.

THE RULES WITH RESPECT TO ADJUSTMENTS ARE COMPLEX AND WARRANT HOLDERS
SHOULD CONSULT THEIR TAX ADVISORS IN THE EVENT OF AN ADJUSTMENT.

THE COMMON STOCK

Dividends Paid on Common Stock

A U.S. Holder generally will be required to include in gross income as
ordinary dividend income the amount of any distributions paid on Common Stock
owned pursuant to the exercise of Warrants to the extent that such distributions
are paid out of the Company's current or accumulated earnings and profits as
determined for U.S. federal income tax purposes. Distributions in excess of such
earnings and profits will reduce the U.S. Holder's tax basis in its Common Stock
and, to the extent such excess distribution exceeds such tax basis, will be
treated as gain from the sale or exchange of the Common Stock. Corporate U.S.
Holders may be entitled to a dividends received deduction with respect to such
distributions, but certain rules may limit such a deduction, and corporate
holders are urged to consult their tax advisors in this regard.

Disposition of Common Stock

Upon the sale or other disposition of Common Stock owned pursuant to the
exercise of Warrants, a U.S. Holder generally will recognize capital gain or
lose equal to the difference between the amount realized on the sale and such
holder's adjusted tax basis in the Common Stock. Gain or loss upon the
disposition of Common Stock will be long term if, at the time of the
disposition, the holding period for the Common Stock exceeds one year.

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INFORMATION REPORTING AND BACKUP WITHHOLDING

In general, information reporting requirements will apply to "reportable
payments" that are made to certain noncorporate U.S. Holders, including proceeds
of sale with respect to the Warrants and the Common Stock, and payments of
dividends of Common Stock. Backup withholding at the rate of 31% may apply to
such payments if the holder (i) fails to furnish or certify its correct taxpayer
identification number to the payor in the manner required, (ii) is notified by
the IRS that it has failed to report payments of interest and dividends properly
or (iii) under certain circumstances, fails to certify under penalty of perjury
that it has furnished a correct taxpayer identification number and that it has
not been notified by the IRS that it is subject to backup withholding for
failure to report interest and dividend payments. Certain holders (including,
among others, all corporations) are not subject to the backup withholding and
information reporting requirements. U.S. Holders should consult their tax
advisors regarding their potential qualification for exemption from backup
withholding and the procedure for obtaining such an exemption, if applicable.
The amount of any backup withholding from a payment to a U.S. Holder will be
allowed as a credit against such U.S. Holder's U.S. federal income tax
liability, and may entitle such U.S. Holder to a refund, provided that the
required information is furnished to the IRS.

PLAN OF DISTRIBUTION

The Warrant Shares offered by the Company and the Selling Security Holders
hereby are issuable upon exercise of the outstanding Warrants. No underwriter
has been or will be engaged by the Company in connection with the offering of
the Warrant Shares. The exercise price of the Warrants was determined through
negotiation between the Company and the Initial Purchaser in connection with the
Unit Offering.

The Warrants and the Warrant Shares may be sold from time to time to
purchasers directly by the Selling Security Holders. Alternatively, the Selling
Security Holders may from time to time offer such securities through
underwriters, dealers or agents who may receive compensation in the form of
underwriting discounts, concessions or commissions from the Selling Security
Holders and/or the purchasers of the securities for whom they may act as agents.
The Selling Security Holders and any underwriters, dealers or agents that
participate in the distribution of the Warrants or the Warrant Shares may be
deemed to be "underwriters" under the Securities Act, and any profit on the sale
of such securities by them and any discounts, commissions or concessions
received by any such underwriters, dealers or agents might be deemed to be
underwriting discounts and commissions under the Securities Act.

At the time a particular offer of the Warrants or the Warrant Shares is
made, if required, the number of Warrants or Warrant Shares being offered and
the terms of the offering, including the name or names of any underwriters,
dealers or agents, the purchase price paid by any underwriter for Warrants or
Warrant Shares purchased from the Selling Security Holders, any discounts,
commissions and other items constituting compensation from the Selling Security
Holders and any discounts, commissions or concessions allowed or reallowed or
paid to dealers, and the proposed selling price to the public will be set forth
in one or more supplements to this Prospectus.

The Warrants and the Warrant Shares offered hereby may be sold from time to
time in one or more transactions at a fixed offering price, which may be
changed, at varying prices determined at the time of sale, or at negotiated
prices. Such prices will be determined by the Selling Security Holders or by
agreement between the Selling Security Holders and any underwriters or dealers,
and the criteria used by them to establish price are likely to include
subjective factors.

To the best knowledge of the Company, there are currently no plans,
arrangements or understandings between any Selling Security Holders and any
broker, dealer or Underwriter regarding the sale of the Warrants and Warrant
Shares by the Selling Security Holders. There is no assurance that any Selling
Security Holder will sell any or all of the Warrants and Warrant Shares offered
by it hereunder or that any such Selling Security Holder will not transfer,
devise or gift such Warrants or Warrant Shares by other means not described
herein.

In order to comply with the applicable securities laws of certain states,
if any, the Warrant Shares and the Warrants may only be sold through registered
or licensed brokers or dealers in those states. In addition, in

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certain states such securities may not be offered or sold unless they have been
registered or qualified for sale in such states or an exemption from such
registration or qualification requirement is available and is complied with.

Under applicable rules and regulations under the Exchange Act, any person
engaged in the distribution of securities may not simultaneously bid for or
purchase securities of the same class for a period of two business days prior to
the commencement of such distribution. In addition and without limiting the
foregoing, the Selling Security Holders will be subject to applicable provisions
of the Exchange Act and the rules and regulations thereunder, including without
limitation Regulation M, in connection with transactions in the Warrants and the
Common Stock during the effectiveness of the Registration Statement of which
this Prospectus forms a part. All the foregoing may affect the marketability of
the Warrant Shares and the Warrants.

LEGAL MATTERS

Certain legal matters with respect to the validity of the New Notes offered
hereby will be passed upon for the Company by Kilpatrick Stockton LLP, Raleigh,
North Carolina. As of April 30, 1998, James M. O'Connell, a partner in the law
firm of Kilpatrick Stockton LLP is a general partner of Nelgo Investments, a
general partnership that owns 270,810 shares of the Common Stock. Mr. O'Connell
owns 17.0% of Nelgo Investments. Mr. O'Connell is the son of Daniel K.
O'Connell, a director of the Company.

EXPERTS

The financial statements of the Company as of June 30, 1997 and 1998 and
for the period from September 18, 1995 (date of incorporation) to June 30, 1996
and the years ended June 30, 1997 and 1998; and of Park 'N View, Ltd. for the
period from January 1, 1995 to November 2, 1995, included in this Prospectus
have been audited by Deloitte & Touche LLP, independent auditors, as stated in
their report appearing herein, and are included in reliance upon the report of
such firm given upon their authority as experts in accounting and auditing.

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PARK 'N VIEW, INC.

INDEX TO FINANCIAL STATEMENTS

<TABLE>
<CAPTION>
PAGE
----
<S> <C>
Independent Auditors' Report................................ F-2
Balance Sheets as of June 30, 1997 and 1998................. F-3
Statements of Operations for the Predecessor for the period
from January 1, 1995 to November 2, 1995 and for the
Successor for the period from September 18, 1995 (Date of
Incorporation) to June 30, 1996 and for the years ended
June 30, 1997 and 1998.................................... F-4
Statements of Changes in Partnership Capital for the
Predecessor for the period from January 1, 1995 to
November 2, 1995 and Statements of Changes in Common
Stockholders' Deficit for the Successor for the period
from September 18, 1995 (Date of Incorporation) to June
30, 1996 and for the years ended June 30, 1997 and 1998... F-5
Statements of Cash Flows for the Predecessor for the period
from January 1, 1995 to November 2, 1995 and for the
Successor for the period from September 18, 1995 (Date of
Incorporation) to June 30, 1996 and the years ended June
30, 1997 and 1998......................................... F-6
Notes to Financial Statements............................... F-7
</TABLE>

F-1
<PAGE> 84

INDEPENDENT AUDITORS' REPORT

To the Board of Directors of
Park 'N View, Inc.:

We have audited the accompanying balance sheets of Park 'N View, Inc. (the
"Company") as of June 30, 1997 and 1998, and the related statements of
operations, changes in partnership capital and common stockholders' deficit, and
cash flows of Park 'N View, Ltd. (the "Predecessor") for the period from January
1, 1995 to November 2, 1995, and of the Company for the period from September
18, 1995 (date of incorporation) to June 30, 1996 and the years ended June 30,
1997 and 1998. These financial statements are the responsibility of the
Company's management. Our responsibility is to express an opinion on these
financial statements based on our audits.

We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements are free of material
misstatement. An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements. An audit also includes
assessing the accounting principles used and significant estimates made by
management, as well as evaluating the overall financial statement presentation.
We believe that our audits provide a reasonable basis for our opinion.

In our opinion, such financial statements present fairly, in all material
respects, the financial position of the Company as of June 30, 1997 and 1998,
and the results of operations and cash flows of the Predecessor for the period
from January 1, 1995 to November 2, 1995, and of the Company for the period from
September 18, 1995 (date of incorporation) to June 30, 1996 and for the years
ended June 30, 1997 and 1998, in conformity with generally accepted accounting
principles.

DELOITTE & TOUCHE LLP
Certified Public Accountants
Fort Lauderdale, Florida

September 11, 1998

F-2
<PAGE> 85

PARK 'N VIEW, INC.

BALANCE SHEETS

<TABLE>
<CAPTION>
JUNE 30,
--------------------------
1997 1998
----------- -----------
<S> <C> <C>
ASSETS
Current Assets:
Cash and cash equivalents................................. $ 4,717,394 $19,810,656
Short-term investments.................................... 32,039,916
Restricted investments (Note 5)........................... 19,263,000
Accounts receivable, net of allowance for doubtful
accounts of $5,400 at June 30, 1997 and 1998........... 11,526 184,180
Inventory................................................. 259,825 362,738
Prepaid expenses and other................................ 138,613 100,877
----------- -----------
Total current assets.............................. 5,127,358 71,761,367
Property and Equipment, Net (Note 3)........................ 7,650,753 18,448,601
Deferred Financing Costs.................................... 143,869 3,744,366
Other Assets................................................ 16,803 623,793
----------- -----------
Total............................................. $12,938,783 $94,578,127
=========== ===========
LIABILITIES AND STOCKHOLDERS' DEFICIT
Current Liabilities:
Accounts payable.......................................... $ 1,116,464 $ 2,067,113
Accrued expenses.......................................... 866,759 2,471,719
Deferred revenue.......................................... 31,929 205,853
Current portion of capital lease obligations (Note 4)..... 265,032 330,814
Current portion of long-term debt (Note 5)................ 33,630 33,727
----------- -----------
Total current liabilities......................... 2,313,814 5,109,226
----------- -----------
Obligations Under Capital Leases (Note 4)................... 366,566 185,174
----------- -----------
Long-Term Debt (Note 5)..................................... 58,864 70,419,566
----------- -----------
Commitments and Contingencies
Series A Redeemable Preferred Stock and Accrued
Dividends -- Par value $.01 per share; 627,630 shares
authorized; 388,075 shares issued and outstanding ($10.00
per share liquidation preference, including accrued
dividends of $212,252 and $542,538 as of June 30, 1997 and
1998, respectively). (Note 6)............................. 3,931,320 4,301,345
----------- -----------
Series B Redeemable Convertible Preferred Stock and Accrued
Dividends -- Par value $.01 per share; 1,372,370 shares
authorized, issued and outstanding ($10.93 per share
liquidation preference, including accrued dividends of
$662,068 and $1,712,083 as of June 30, 1997 and 1998).
(Note 6).................................................. 15,200,146 16,316,432
----------- -----------
Series C Redeemable Convertible Preferred Stock and Accrued
Dividends -- Par value $.01 per share; 3,750,000 shares
authorized, 2,328,543 issued and outstanding ($8.00 per
share liquidation preference, including accrued dividends
of $1,115,631 as of June 30, 1998). (Note 6).............. 18,516,147
-----------
Common Stockholders' Deficit:
Common stock -- par value $.001 per share; 7,000,000 and
12,000,000 shares authorized at June 30, 1997 and 1998,
respectively; 4,318,182 shares issued and
outstanding............................................ 4,318 4,318
Additional paid-in capital................................ 8,764 5,197,212
Accumulated deficit....................................... (8,945,009) (25,471,293)
----------- -----------
Total common stockholders' deficit................ (8,931,927) (20,269,763)
----------- -----------
Total............................................. $12,938,783 $94,578,127
=========== ===========
</TABLE>

See notes to financial statements.

F-3
<PAGE> 86

PARK 'N VIEW, INC.

STATEMENTS OF OPERATIONS

<TABLE>
<CAPTION>
PREDECESSOR SUCCESSOR
------------------ --------------------------------------------------
PERIOD FROM
SEPTEMBER 18, 1995
PERIOD FROM (DATE OF
JANUARY 1, 1995 TO INCORPORATION) TO YEAR ENDED YEAR ENDED
NOVEMBER 2, 1995 JUNE 30, 1996 JUNE 30, 1997 JUNE 30, 1998
------------------ ------------------ ------------- -------------
<S> <C> <C> <C> <C>
Revenues:
Service revenue................... $ 68,451 $ 755,057 $ 3,333,564
Equipment sales................... 76,953 51,909 97,489
Advertising....................... 4,050 22,500
Other............................. 301 58,931 72,723
----------- ----------- ------------
Total revenues............ 149,755 888,397 3,503,776
----------- ----------- ------------
Cost of Revenues
Service cost...................... 287,792 996,260 3,336,176
Service depreciation.............. 84,341 643,316 1,906,732
Equipment cost.................... 62,821 422,557 1,356,085
Advertising....................... 1,875 15,556
----------- ----------- ------------
Total cost of revenues.... 436,829 2,077,689 6,598,993
----------- ----------- ------------
Gross margin........................ (287,074) (1,189,292) (3,095,217)
Selling, general and administrative
expenses.......................... $ 475,891 1,576,209 4,431,889 10,378,471
Write-down of equipment............. 594,691 35,151
--------- ----------- ----------- ------------
Loss from operations................ (475,891) (1,863,283) (6,215,872) (13,508,839)
Interest expense.................... 103,079 157,416 1,030,594
Interest income and other........... (5,125) (328,268) (805,686)
--------- ----------- ----------- ------------
Net loss.................. $(475,891) (1,961,237) (6,045,020) (13,733,747)
=========
Preferred stock dividends
and amortization of
preferred stock issuance
costs................... (21,370) (917,382) (2,792,537)
----------- ----------- ------------
Net loss attributable to
common stockholders..... $(1,982,607) $(6,962,402) $(16,526,284)
=========== =========== ============
Basic loss per share...... $ (0.46) $ (1.61) $ (3.83)
=========== =========== ============
</TABLE>

See notes to financial statements.

F-4
<PAGE> 87

PARK 'N VIEW, INC.

STATEMENTS OF CHANGES IN PARTNERSHIP CAPITAL AND
COMMON STOCKHOLDERS' DEFICIT

<TABLE>
<CAPTION>
PARTNERSHIP
PREDECESSOR CAPITAL
- ----------- -----------
<S> <C>
Balance, January 1, 1995.......................... $ (55,292)
Contributions from partners....................... 446,737
Net loss.......................................... (475,891)
---------
Balance, November 2, 1995......................... $ (84,446)
=========
</TABLE>

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

<TABLE>
<CAPTION>
COMMON STOCK ADDITIONAL
------------------ PAID-IN ACCUMULATED
SUCCESSOR SHARES AMOUNT CAPITAL DEFICIT TOTAL
- --------- --------- ------ ---------- ------------ ------------
<S> <C> <C> <C> <C> <C>
Net liabilities transferred from Park
'N View, Ltd. in exchange for
shares in Park 'N View, Inc........ 2,318,182 $2,318 $ (86,764) $ (84,446)
Shares issued at initial closing..... 2,000,000 2,000 98,000 100,000
Financing costs...................... (2,472) (2,472)
Dividends accrued for Series A
preferred stock.................... $ (21,370) (21,370)
Net loss............................. (1,961,237) (1,961,237)
--------- ------ ---------- ------------ ------------
Balance, June 30, 1996............... 4,318,182 4,318 8,764 (1,982,607) (1,969,525)
Dividends accrued for Series A
preferred stock.................... (190,882) (190,882)
Dividends accrued for Series B
preferred stock.................... (662,068) (662,068)
Amortization of preferred stock
issuance cost...................... (64,432) (64,432)
Net loss............................. (6,045,020) (6,045,020)
--------- ------ ---------- ------------ ------------
Balance, June 30, 1997............... 4,318,182 4,318 8,764 (8,945,009) (8,931,927)
Dividends accrued for Series A
preferred stock.................... (330,286) (330,286)
Dividends accrued for Series B
preferred stock.................... (1,050,015) (1,050,015)
Dividends accrued for Series C
preferred stock.................... (1,115,631) (1,115,631)
Amortization of preferred stock
issuance cost...................... (296,605) (296,605)
Issuance of common stock warrants.... 5,188,448 5,188,448
Net loss............................. (13,733,747) (13,733,747)
--------- ------ ---------- ------------ ------------
Balance, June 30, 1998............... 4,318,182 $4,318 $5,197,212 $(25,471,293) $(20,269,763)
========= ====== ========== ============ ============
</TABLE>

See notes to financial statements.

F-5
<PAGE> 88

PARK 'N VIEW, INC.

STATEMENTS OF CASH FLOWS

<TABLE>
<CAPTION>
PREDECESSOR SUCCESSOR
--------------- --------------------------------------------------
PERIOD FROM
PERIOD FROM SEPTEMBER 18, 1995
JANUARY 1, 1995 (DATE OF
TO NOVEMBER 2, INCORPORATION) TO YEAR ENDED YEAR ENDED
1995 JUNE 30, 1996 JUNE 30, 1997 JUNE 30, 1998
--------------- ------------------ ------------- -------------
<S> <C> <C> <C> <C>
Operating Activities:
Net loss....................................... $(475,891) $(1,961,237) $(6,045,020) $(13,733,747)
Adjustments to reconcile net loss to net cash
used in operating activities:
Depreciation and amortization................ 27,966 174,360 705,418 2,117,387
Write-down of equipment...................... 594,691 35,151
Provision for losses on accounts
receivable................................. 5,411
Loss on disposal of property and equipment... 2,150
Changes in assets and liabilities:
Accounts receivable........................ (57,801) 40,864 (172,653)
Inventories................................ (141,698) (118,127) (102,912)
Prepaid expenses and other................. (5,000) (116,917) (21,696) 37,737
Other assets............................... (13,027) (3,776) (285,567)
Accounts payable........................... 54,116 399,090 717,374 950,649
Accrued expenses........................... 210,556 744,622 1,604,960
Deferred revenue........................... 48,557 (16,628) 173,924
--------- ----------- ----------- ------------
Net cash used in operating activities... (398,809) (1,452,706) (3,400,128) (9,375,071)
--------- ----------- ----------- ------------
Investing Activities:
Purchase of short-term investments........... (32,039,916)
Purchase of restricted investments........... (19,263,000)
Purchases of property and equipment.......... (909) (1,650,177) (6,443,899) (12,596,875)
--------- ----------- ----------- ------------
Net cash used in investing activities... (909) (1,650,177) (6,443,899) (63,899,791)
--------- ----------- ----------- ------------
Financing Activities:
Proceeds from issuance of long-term debt and
common stock warrants, net of offering
commission................................... 3,000,000 1,500,000 72,375,000
Proceeds from issuance of common and preferred
stock........................................ 800,000 13,500,000 18,628,344
Contributions from partners.................... 70,070
Loans from partners............................ 310,000
Payment of stock and debt issuance costs and
other........................................ (152,000) (509,560) (1,225,705)
Payment of obligation under capital lease...... (227,327) (365,412)
Deferred financing costs....................... (195,434) (143,869) (1,010,700)
Notes payable.................................. 16,048 76,446 (33,403)
--------- ----------- ----------- ------------
Net cash provided by financing
activities............................ 380,070 3,468,614 14,197,690 88,368,124
--------- ----------- ----------- ------------
Net Increase (Decrease)In Cash And Cash
Equivalents.................................... (19,648) 365,731 4,351,663 15,093,262
Cash And Cash Equivalents, Beginning Of Period... 19,856 365,731 4,717,394
--------- ----------- ----------- ------------
Cash And Cash Equivalents, End Of Period......... $ 208 $ 365,731 $ 4,717,394 $ 19,810,656
========= =========== =========== ============
Supplemental Cash Flow Information:
Interest paid.................................. $ 14,660 $ 48,987 $ 33,030
=========== =========== ============
Non-Cash Financing And Investing Activities:
Conversion of partnership loans into
partnership capital.......................... $ 376,667
=========
Historical carrying value of net liabilities
assumed at formation in exchange for Common
Stock........................................ $ (84,446)
===========
Capital lease obligations relating to
acquisition of property and equipment........ $ 472,029 $ 357,932 $ 249,801
=========== =========== ============
Exchange of promissory notes and accrued
interest for Series B Preferred Stock........ $ 1,533,000
===========
Exchange of promissory notes and accrued
interest for Series A Preferred Stock........ $ 3,180,646
===========
Issuance of common stock warrants.............. $ 538,998
============
</TABLE>

See notes to financial statements.

F-6
<PAGE> 89

PARK 'N VIEW, INC.

NOTES TO FINANCIAL STATEMENTS

1. FORMATION OF THE COMPANY AND NATURE OF BUSINESS

Park 'N View, Inc. (the "Company") was incorporated on September 18, 1995
and provides cable television and telephone service to long-haul truck drivers
at truckstops ("sites") throughout the country. As of June 30, 1998, the Company
has 118 sites in operation. The Company has contracts to provide their service
to over 600 sites. The final determination on the number of sites to be provided
with the service will be made by the Company on a site-by-site basis.

The Company commenced commercial operations as a result of the Securities
Purchase Agreement (the "Agreement") dated November 2, 1995 between the former
partners of Park 'N View, Ltd., the Company's predecessor entity, and an
investor group led by Patricof & Company ("Patricof").

Pursuant to the Agreement, Park 'N View, Ltd. transferred certain of its
assets, intangible assets, contractual rights, and certain liabilities to the
Company in exchange for 2,318,182 shares of Common Stock issued to the former
partners of Park 'N View, Ltd. These net liabilities were recorded by the
Company at the historical carrying amounts. Patricof was issued 2,000,000 shares
of Common Stock for $100,000.

Park 'N View, Ltd. was incorporated for the purpose of developing cable
television and telephone service technology for use by long-haul truck drivers
at truckstops. The accompanying financial statements identified as for the
Predecessor are for Park 'N View, Ltd. for the period from January 1, 1995 to
November 2, 1995. The accompanying financial statements identified as for the
Successor are for Park 'N View, Inc. as of June 30, 1997 and 1998 and for the
period from September 18, 1995 (date of incorporation) to June 30, 1996 and for
the years ended June 30, 1997 and 1998.

The Company has experienced net operating losses since its inception and as
of June 30, 1998 had an accumulated deficit of $25.5 million. Management
believes that the Company must significantly increase the sales of Park 'N View
service subscriptions in order to achieve profitability. Management further
believes that a significant increase in sales of subscriptions is dependent on
truck drivers' perception that the Park 'N View system is installed and
operating at a sufficient number and location of truckstops that potential uses
of the Park 'N View system justify the subscription fee. The Company's future
success will depend on achieving market acceptance in sufficient numbers and at
commercially viable subscription rates, the timely and cost-effective
installation of the Park 'N View system at a significant number of additional
truckstops, and obtaining the financing necessary to install its system in a
sufficient number of locations.

2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

A summary of the significant accounting policies applied in the preparation
of the accompanying financial statements follows:

Accounting Estimates -- The preparation of financial statements in
conformity with generally accepted accounting principles requires
management to make estimates and assumptions that affect the reported
amounts of assets and liabilities and disclosure of contingent assets and
liabilities at the date of the financial statements and the reported
amounts of revenues and expenses during the reporting period. Actual
results could differ from those estimates.

Cash and Cash Equivalents -- The Company considers all highly liquid
investments purchased with an original maturity of three months or less to
be cash equivalents. The Company's cash and cash equivalents are primarily
composed of bank deposits and overnight funds held by a bank.

Inventory -- Consists principally of telephones and components and is
stated at lower of cost (first-in, first-out method) or market.

Property and Equipment -- Property and equipment is stated at cost,
less accumulated depreciation. Depreciation is provided using the
straight-line method over the estimated useful lives of the assets,

F-7
<PAGE> 90
PARK 'N VIEW, INC.

NOTES TO FINANCIAL STATEMENTS -- (CONTINUED)

generally three to ten years. Expenditures for improvements that
substantially extend the capacity or useful life of an asset are
capitalized. Routine repairs and maintenance are expensed as incurred.

The Company currently expenses the costs associated with developing
internal use proprietary software. In March 1998, the American Institute of
Certified Public Accountants issued Statement of Position 98-1 ("SOP
98-1"), Accounting for the Cost of Computer Software Developed or Obtained
for Internal Use. SOP 98-1 establishes that computer software costs that
are incurred in the preliminary project stage should be expensed as
incurred. Once the application development stage criteria is met, certain
costs are required to be capitalized. SOP 98-1 is effective for financial
statements for fiscal years beginning after December 15, 1998. Adoption of
SOP 98-1 is not expected to have a material impact on the Company's
financial position or results of operations.

Deferred Financing Costs -- Costs incurred in connection with
obtaining financing are being amortized based on the interest method over
the term of the related obligations. Amortization of deferred financing
costs relating to debt are amortized to interest expense and amortization
of deferred financing costs relating to preferred stock are amortized to
accumulated deficit.

Revenue Recognition/Deferred Revenue -- For the Company's monthly and
"power plan" programs, net revenues from the sale of such subscriptions are
amortized to revenue over the period of the subscription. The amount of net
revenue associated with the unexpired portion of the subscription is
reported as deferred revenue. Fleet subscriptions are sold and paid on a
calendar month basis, therefore revenue received for such subscriptions
relates to and is recognized in the specific month for which it is billed.
Fees from the daily and premium programs, which allow access for a 24 hour
period, are recognized as revenue when sold. Revenues from equipment sales
are derived from the sale by the Company of cable and telephone line
extension kits to truckstops for resale to truckdrivers.

Income Taxes -- In conformity with the Internal Revenue Code and
applicable state and local tax statutes, taxable income or loss of the
Predecessor is required to be reported in the tax returns of the partners.
Accordingly, no provision has been made in the accompanying Predecessor
financial statements for any federal or state income taxes.

The provision for income taxes for the Company represents the amount
payable or refundable for the period plus or minus the change during the
period in deferred tax assets and liabilities. The Company provides for
deferred taxes under the liability method. Under such method, deferred
taxes are adjusted for tax rate changes as they occur. Deferred income tax
assets and liabilities are computed annually for differences between the
financial reporting and tax bases of assets and liabilities that will
result in taxable or deductible amounts in the future based on enacted tax
laws and rates applicable to the periods in which the differences are
expected to affect taxable income. Valuation allowances are recorded when
necessary to reduce deferred tax assets to the amount that management
believes is more likely than not to be realized.

Long-Lived Assets -- Management reviews long-lived assets for possible
impairment whenever events or circumstances indicate that the carrying
amount of an asset may not be recoverable. If there is an indication of
impairment, management prepares an estimate of future cash flows
(undiscounted and without interest charges) expected to result from the use
of the asset and its eventual disposition. If these cash flows are less
than the carrying amount of the asset, an impairment loss is recognized to
write down the asset to its estimated fair value. Assets, if any, which
management has committed to a plan to dispose, whether by sale or
abandonment, are reported at the lower of carrying amount or fair value,
less cost to sell. Preparation of estimated expected future cash flows is
inherently subjective and is based on management's best estimate of
assumptions concerning future conditions.

Financial Instruments -- The carrying amount for cash, accounts
receivable and accounts payable approximates fair value due to their
short-term maturity. Short-term investments consist of commercial

F-8
<PAGE> 91
PARK 'N VIEW, INC.

NOTES TO FINANCIAL STATEMENTS -- (CONTINUED)

paper that is carried at amortized cost, which approximates fair value.
Restricted investments consist of US Treasury securities that are actively
traded and are carried at fair value, with unrealized gains and losses
included in earnings.

The fair value of the Company's long-term debt approximates carrying
value based on the quoted market prices for the same or similar issues or
on the current rate offered to the Company for debt of the same remaining
maturities. The Company believes that it is not practical to estimate a
fair value different from the preferred stocks' carrying value as these
securities have numerous features unique to these securities.

Basic Loss Per Share -- Basic loss per share is computed by dividing
the net loss attributable to common stockholders by the number of weighted
average common shares outstanding. The effect of potential common stock
would have been antidilutive and therefore basic loss per share for the
Company is equivalent to diluted loss per share. The weighted average
common shares outstanding was 4,318,182 for the period from September 18,
1995 to June 30, 1996 and the years ended June 30, 1997 and 1998.

In February 1997, the Financial Accounting Standards Board issued
Statement of Financial Accounting Standards ("SFAS") No. 128, Earnings Per
Share. This statement supercedes Accounting Principles Board ("APB")
Opinion No. 15 and replaces primary and fully diluted earnings per share
with a dual presentation of basic and diluted earnings per share. Basic
earnings per share equals net loss attributable to common stockholders
divided by the number of weighted average common shares outstanding.
Diluted earnings per share includes potentially dilutive securities such as
stock options. The adoption by the Company of this standard had no effect
on the Company's reported net loss per share.

Reclassifications -- Certain 1996 and 1997 amounts have been
reclassified to conform with the 1998 presentation.

New Accounting Pronouncement -- In June 1997, the Financial Accounting
Standards Board issued SFAS No. 131, Disclosure about Segments of an
Enterprise and Related Information. This standard is effective for
financial statements for fiscal years beginning after December 15, 1997.
SFAS No. 131 establishes standards for the way that public business
enterprises report information about operating segments in annual financial
statements and requires that those enterprises report selected information
about operating segments in interim financial reports issued to
shareholders. It also establishes standards for related disclosures about
products and services, geographic areas, and major customers. The Company
has not yet determined the effect, if any, that SFAS No. 131 will have on
its financial statements and notes thereto.

F-9
<PAGE> 92
PARK 'N VIEW, INC.

NOTES TO FINANCIAL STATEMENTS -- (CONTINUED)

3. PROPERTY AND EQUIPMENT

Property and equipment consisted of the following:

<TABLE>
<CAPTION>
1997 1998
---------- -----------
<S> <C> <C>
Site equipment and improvements............................. $5,404,620 $16,484,956
Construction equipment...................................... 127,912 150,059
Computer equipment.......................................... 231,907 352,643
Vehicles.................................................... 255,467 451,382
Furniture, fixtures and other equipment..................... 28,739 65,869
---------- -----------
Subtotal.......................................... 6,048,645 17,504,909
Less accumulated depreciation............................... 616,482 2,630,706
---------- -----------
Subtotal.......................................... 5,432,163 14,874,203
Component inventory......................................... 2,218,590 3,574,398
---------- -----------
Property and equipment, net................................. $7,650,753 $18,448,601
========== ===========
</TABLE>

Component inventory represents equipment that is awaiting installation at a
site. Upon installation the cost of the related equipment is transferred to site
equipment and improvements and depreciation commences once the site is
operational.

During the year ended June 30, 1997, the Company replaced certain telephone
switches with updated technology. At the time this equipment was taken out of
service there existed a related capital lease obligation of $538,957. The
Company is continuing to make the scheduled capital lease payments and has
written-off the idle equipment, which had a carrying value $594,691.

4. LEASE COMMITMENTS

The Company leases an office site and equipment maintained at various
facilities under operating leases. Capital leases primarily consist of
construction equipment. Future minimum lease payments under capital leases and
noncancellable operating leases are as follows:

<TABLE>
<CAPTION>
YEAR ENDING JUNE 30: OPERATING CAPITAL
- -------------------- ---------- --------
<S> <C> <C>
1999........................................................ $ 277,528 $355,385
2000........................................................ 268,759 153,880
2001........................................................ 272,083 44,458
2002........................................................ 188,637 --
2003........................................................ 28,962 --
---------- --------
Total............................................. $1,035,969 553,723
==========
Imputed interest on capital leases.......................... (37,735)
--------
Present value of capital leases............................. 515,988
Current portion............................................. 330,814
--------
Long-term portion........................................... $185,174
========
</TABLE>

Rent expense was $77,569, $149,401 and $355,765 for the period ended June
30, 1996 and for the years ended June 30, 1997 and 1998, respectively.

In July 1998, the Company entered into contracts with AT&T to lease T-1
lines and purchase long distance and local telephone service. The minimum lease
payments for the T-1 lines approximate $5.1 million, $7.7 million and $7.7
million per year during the first, second, and third years of the lease,
respectively. The Company's minimum purchase for the long distance and local
telephone service is $480,000 per year for a two year term.

F-10
<PAGE> 93
PARK 'N VIEW, INC.

NOTES TO FINANCIAL STATEMENTS -- (CONTINUED)

In August 1998, the Company entered into an operating lease for a wide area
network. The annual minimum rental amount approximates $1.2 million for a three
year term.

5. NOTES PAYABLE

In May 1998, the Company issued $75 million of 13% Senior Notes (the
"Senior Notes"). The Senior Notes are general senior obligations of the Company
and will rank pari passu with all current and future unsecured senior
indebtedness of the Company. The Senior Notes have a maturity date of May 15,
2008. Interest will be paid semiannually on May 15 and November 15 to holders of
record on the immediately preceding May 1, and November 1, respectively. The
Company placed $19.2 million of the net proceeds from the Senior Notes in an
escrow account. The escrow account is pledged as security for payment of the
first four scheduled interest payments on the Senior Notes. The amount in this
escrow account is presented as restricted investments in the accompanying
balance sheet.

The Senior Notes are redeemable at the Company's option after May 15, 2003,
at which time the Company will pay a decreasing premium for this redemption
until maturity at May 15, 2008. At any time prior to May 15, 2001, the Company,
at its option, may redeem up to 35% of the then outstanding Senior Notes with
the net proceeds of an initial public equity offering at a redemption price of
113% of the principal amount and accrued interest. The Senior Notes are
mandatorily redeemable at the option of the holders in the event of a change in
control or an asset sale.

The Senior Notes were issued together with warrants in the form of units.
The relative fair market values for the Senior Notes and warrants were
determined by the negotiations with the purchasers of the units. The agreed upon
original issue discount resulted in an allocation of $70,350,000 of the proceeds
to the Senior Notes and $4,650,000 to the warrants.

At June 30, 1997 and 1998, the Company had outstanding $92,494 and $59,092,
respectively, of notes payable relating to the purchase of vehicles. These notes
have an average interest rate of 10% and mature on various dates through March
2000.

Scheduled debt maturities are as follows:

<TABLE>
<CAPTION>
YEAR ENDING JUNE 30
- -------------------
<S> <C>
1999................................................... $ 33,727
2000................................................... 25,365
2001................................................... --
2002................................................... --
2003................................................... --
Thereafter............................................. 75,000,000
-----------
Subtotal 75,059,092
Less debt discount 4,605,799
-----------
Total $70,453,293
===========
</TABLE>

At June 30, 1996, the Company had outstanding $3,000,000 of 8% Subordinated
Promissory Notes ("Notes") due November 1, 2000, with interest payable
semiannually on June 30 and December 31. The Notes were held by Patricof. On
August 5, 1996, Patricof provided the Company with an additional $1,500,000 in
exchange for 8% Subordinated Promissory Notes due November 2, 2000 and 239,250
common stock warrants. On November 13, 1996, the Company completed a private
placement (the "1996 Offering") with certain investors of 1,372,370 shares of
Series B 7% Cumulative Convertible Preferred Stock (the "Series B Preferred")
due November 7, 2003 for a purchase price of $10.93 per share and a total
offering amount of $15,000,000. As payment for 137,237 shares of the Series B
Preferred, Patricof exchanged the

F-11
<PAGE> 94
PARK 'N VIEW, INC.

NOTES TO FINANCIAL STATEMENTS -- (CONTINUED)

$1,500,000 8% Subordinated Promissory Notes and the 239,250 common stock
warrants. In addition, the $3,000,000 in Notes and related accrued interest of
$180,646 were exchanged by Patricof for 318,065 shares of Series A Redeemable
Preferred Stock (the "Series A Preferred").

6. REDEEMABLE PREFERRED STOCK

Series A Redeemable Preferred Stock -- On November 13, 1996, in connection
with the 1996 Offering, $3,000,000 in Notes and related accrued interest of
$180,646 were exchanged for 318,065 shares of Series A Preferred. In November
1995, in accordance with the Agreement, 32,210 shares of Series A Preferred were
issued at $10 per share to Patricof. In April 1996, Patricof purchased an
additional 37,800 shares of Series A Preferred at $10 per share. The Series A
Preferred provides for an annual dividend of 7%, payable in arrears quarterly in
cash or in kind. Cumulative unpaid dividends in arrears were $212,252 and
$542,538 at June 30, 1997 and 1998, respectively.

The Company is required to redeem for $10 per share all of the issued and
outstanding shares of Series A Preferred as follows: (a) six months after the
Senior Notes are paid in full, (b) upon the receipt of proceeds of an initial
public offering of not less than $20 million, net of underwriting expenses
("Qualifying Offer"), (c) in the event the Company consolidates or merges with
or into another entity, or (d) upon sale of the Company's assets. The Company
has the option to redeem shares of Series A Preferred at any time for $10 per
share plus all accrued dividends thereon. The Company may not redeem any shares
of Series A Preferred until the Company pays the Senior Notes in full.

Upon the failure of the Company to redeem the Series A Preferred as
required, the shareholders of the Series A Preferred shall be entitled to vote
as a separate class only in respect to any merger, consolidation, sale of assets
or creation of any class or series, other than Series B Preferred and Series C
Preferred, equal to or superior to its Series A Preferred. The shareholders of
at least 66.6% of the outstanding Series A Preferred voting as a separate class
shall be entitled to elect two members of the Board of Directors.

Series B 7% Cumulative Convertible Preferred Stock -- In connection with
the 1996 Offering, the Company authorized and issued 1,372,370 shares of Series
B Preferred, par value of $.01 for $10.93 per share and a total offering amount
of $15,000,000.

Commencing on January 31, 1997, the shareholders of the Series B Preferred
are entitled to receive dividends payable in cash at 7% per annum (9% per annum
upon an event of default). An "Event of Default" includes any of the following:
(a) failure by the Company to declare and pay a dividend on the payment due date
for two consecutive quarterly periods, (b) failure by the Company to satisfy its
redemption obligations, (c) default by the Company in the performance or
observance of any obligation or condition with respect to the indebtedness of
the Company, (d) failure to comply with covenants in the agreement, (e) failure
by the Company to comply with its obligations upon liquidation, dissolution or
winding up, or (f) insolvency. Cumulative unpaid dividends accrued were $662,068
and $1,712,083 at June 30, 1997 and 1998.

The Company is required to redeem for $10.93 per share all of the issued
and outstanding shares of Series B Preferred as follows: (a) six months after
the Senior Notes are paid in full, (b) upon receipt of a Qualifying Offer, (c)
in the event the Company consolidates or merges with or into another entity, or
(d) upon sale of the Company's assets. The Company may not redeem any shares of
Series B Preferred until the Company pays the Senior Notes in full.

The shareholders of Series B Preferred can convert their shares at any time
at the option of the holder into Common Stock at a conversion rate of one Series
B Preferred Share for 1.37 shares of Common Stock. Under antidilution
provisions, the conversion price of Series B Preferred will be adjusted upon the
Company's issuance of additional shares of Common Stock, warrants or rights to
purchase Common Stock or securities convertible into Common Stock.

F-12
<PAGE> 95
PARK 'N VIEW, INC.

NOTES TO FINANCIAL STATEMENTS -- (CONTINUED)

Series B Preferred shareholders are entitled to the number of votes equal
to the number of full shares of Common Stock into which such shares of Series B
Preferred is then convertible. Shareholders of Series B Preferred and Common
Stock shall vote together on each matter submitted to stockholders and not by
class or series. Prior to the consummation of a Qualifying Offer, the
shareholders of the Series B Preferred, voting together as a class, shall be
entitled to elect one director. Subsequent to a Qualifying Offer and only so
long as at least 66.6% of the shares of Series B Preferred originally issued
remain outstanding, the holders of a majority of the shares of Common Stock
issuable upon conversion of the Series B Preferred shall be entitled to nominate
one director. Upon the occurrence of an event of default, the shareholders of
the Series B Preferred, together with the shareholders of Series C Preferred,
have the exclusive right to elect a majority of the Board of Directors.

Series C Redeemable Preferred Stock -- In August 1997, the Company entered
into a private placement offering (the "1997 Offering") with certain investors
to raise additional working capital through the sale of 2,328,543 shares of
Series C 7% Cumulative Convertible Preferred Stock (the "Series C Preferred")
for a purchase price of $8.00 per share and a total offering amount of
$18,628,344. Upon an Event of Default, the annual dividend rate will be 9%. The
Series C Preferred votes in conjunction with the Series B Preferred on an
as-if-converted basis. The Series C Preferred is convertible into 2,328,543
shares of Common Stock at a price of $8.00 per share. Also, as part of the 1997
Offering, the Company issued a warrant to the underwriting agent for the
purchase of 100,399 shares of Common Stock exercisable at $8.00 per share at any
time within five years from the date of this offering. Cumulative unpaid
dividends accrued were $1,115,631 at June 30, 1998.

The Company is required to redeem for $8.00 per share all of the issued and
outstanding shares of Series C Preferred as follows: (a) six months after the
Senior Notes are paid in full, (b) upon receipt of a Qualifying Offer, (c) in
the event the Company consolidates or merges with or into another entity, or (d)
upon sale of the Company's assets. The Company may not redeem any shares of
Series C Preferred until the Company pays the Senior Notes in full.

The shareholders of Series C Preferred can convert their shares at any time
at the option of the holder into Common Stock at an initial conversion rate of
one Series C Preferred share for one share of Common Stock. Under antidilution
provisions, the conversion price of Series C Preferred will be adjusted upon the
Company's issuance of additional shares of Common Stock, warrants or rights to
purchase Common Stock.

Series C Preferred shareholders are entitled to the number of votes equal
to the number of full shares of Common Stock into which such shares of Series C
Preferred is then convertible. Shareholders of Series C Preferred and Common
Stock shall vote together on each matter submitted to stockholders and not by
class or series. Prior to the consummation of a Qualifying Offer, the
shareholders of the Series C Preferred, voting together as a class, shall be
entitled to elect one director. Subsequent to a Qualifying Offer and only so
long as at least 66.6% of the shares of Series C Preferred originally issued
remain outstanding, the holders of a majority of the shares of Common Stock
issuable upon conversion of the Series C Preferred shall be entitled to nominate
one director. Upon the occurrence of an event of default, the shareholders of
the Series C Preferred, together with the shareholders of Series B Preferred, as
a class have the exclusive right to elect a majority of the Board of Directors.

7. RELATED PARTY TRANSACTIONS

A common stockholder of the Company is also a partner in a law firm that
provides legal services to the Company. Fees and expenses paid to the law firm
were $293,647 for the year ended June 30, 1998. Fees and expenses paid to the
law firm for the period ended June 30, 1996 and for the year ended June 30, 1997
were not significant.

Prepaid expenses and other at June 30, 1997 includes $64,000 in cash
advances to a Company executive. A promissory note was executed for $59,000 of
the advances. The advances were satisfied in August 1997.

F-13
<PAGE> 96
PARK 'N VIEW, INC.

NOTES TO FINANCIAL STATEMENTS -- (CONTINUED)

8. STOCK OPTIONS AND WARRANTS

The Company has incentive and non-qualified stock option plans for
directors and key employees and has 800,000 shares of Common Stock reserved for
issuance under the plans. The incentive and non-qualified options become
exercisable as determined by the Board of Directors and have a term of ten
years.

Option activity for the year ended June 30, 1997 and 1998 is as follows:

<TABLE>
<CAPTION>
AVERAGE
NUMBER EXERCISE PRICE RANGE OF
OF SHARES PER SHARE EXERCISE PRICE
--------- -------------- --------------
<S> <C> <C> <C>
Granted options:
Granted during the year ended June 30, 1997 and
outstanding at June 30, 1997................... 409,846 $1.42 $1.00-$3.00
Forfeited during the year ended June 30, 1998..... (500) 1.00 1.00
-------
Outstanding at June 30, 1998...................... 409,346 1.42 1.00-3.00
=======
Vested options:
Exercisable at June 30, 1997...................... 81,969 1.42 1.00-3.00
Vested during the year ended June 30, 1998........ 81,869 1.42 1.00-3.00
Forfeited during the year ended June 30, 1998..... (100) 1.00 1.00
-------
Exercisable at June 30, 1998...................... 163,738 1.42 1.00-3.00
=======
</TABLE>

The weighted average remaining contractual life of options outstanding is
9.5 years and 8.4 years at June 30, 1997 and 1998, respectively.

The Company accounts for stock options in accordance with APB Opinion No.
25. The Company's stock options are issued with exercise prices which equal the
fair value of the Company's Common Stock on the date of grant and, consequently,
no compensation expense is recognized.

SFAS No. 123 requires entities that account for awards for stock-based
compensation in accordance with APB Opinion No. 25 to present pro forma
disclosure as if compensation cost was measured at the date of grant based on
the fair value of the award. No options were granted during the year ended June
30, 1998. The fair value of the options granted during the year ended June 30,
1997 were estimated at the date of grant using the minimum value method with the
following weighted-average assumptions: a risk free interest rate of 6.8%, no
dividend yield and an expected life of six years. The weighted average grant
date fair value per option is approximately $.46.

The minimum value option valuation model was developed for use in
estimating the fair value of traded options which have no vesting restrictions
and are fully transferable. In addition, option valuation models require the
input of highly subjective assumptions. Because the Company's employee stock
options have characteristics significantly different from those of traded
options, and because changes in the subjective input assumptions can materially
affect the fair value estimate, in management's opinion, the existing models do
not necessarily provide a reliable single measure of the fair value of its
employee stock options.

F-14
<PAGE> 97
PARK 'N VIEW, INC.

NOTES TO FINANCIAL STATEMENTS -- (CONTINUED)

For purposes of pro forma disclosure, the estimated fair value of the
options is amortized to expense over the options vesting period. The Company's
net loss determined in accordance with SFAS No. 123 on a pro forma basis for the
years ended June 30, 1997 and 1998 would have been as follows:

<TABLE>
<CAPTION>
1997 1998
---- ----
<S> <C> <C>
Net loss:
As reported............................................. $ (6,045,020) $(13,733,747)
Pro forma............................................... (6,082,726) (13,771,453)
Loss per share:
As reported............................................. (1.61) (3.83)
Pro forma............................................... (1.62) (3.84)
</TABLE>

The pro forma amount may not be representative of the future effects on
reported net income that will result from the future granting of stock options,
since the pro forma compensation expense is allocated over the periods in which
options become exercisable and new option awards are granted each year.

The Company has warrants outstanding which allow the holders to purchase
280,399 shares of Common Stock at $8 per share.

9. INCOME TAXES

No current income taxes have been provided for any periods presented as the
Company has had net operating losses since inception. The Company had
approximately $20.6 million in net operating loss carryforwards at June 30, 1998
for income tax purposes, with approximately $2 million expiring in 2011, $5.4
million expiring in 2012 and $13.2 million expiring in 2013.

Deferred income taxes reflect the net tax effects of (a) temporary
differences between the carrying amounts of assets and liabilities for financial
reporting purposes and the amounts used for income tax purposes, and (b)
operating loss and tax credit carryforwards. The Company has not recognized any
benefit for its net deferred tax asset and has offset the net deferred tax asset
by a valuation allowance, as it is more likely than not that this asset will not
be realized prior to its expiration. The tax effects of significant items
comprising the Company's net deferred tax asset as of June 30, 1997 and 1998 are
as follows:

<TABLE>
<CAPTION>
1997 1998
----------- -----------
<S> <C> <C>
Deferred tax assets:
Net operating loss carryforward........................... $ 2,385,208 $ 6,876,586
Nondeductible lease accrual............................... 237,876 88,932
Bad debt reserve.......................................... 2,164 2,164
Vacation accrual.......................................... 14,536 45,981
----------- -----------
2,639,784 7,013,662
----------- -----------
Deferred tax liabilities:
Differences between book and tax basis of property........ 409 45,771
Amortization.............................................. 14,095 8,821
----------- -----------
14,504 54,592
----------- -----------
Valuation allowance......................................... (2,625,280) (6,959,070)
----------- -----------
Net deferred tax asset............................ $ -- $ --
=========== ===========
</TABLE>

F-15
<PAGE> 98

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

NO PERSON HAS BEEN AUTHORIZED TO GIVE ANY INFORMATION OR TO MAKE ANY
REPRESENTATIONS OTHER THAN THOSE CONTAINED OR INCORPORATED BY REFERENCE IN THIS
PROSPECTUS AND, IF GIVEN OR MADE, SUCH INFORMATION OR REPRESENTATIONS MUST NOT
BE RELIED UPON AS HAVING BEEN AUTHORIZED BY THE COMPANY. THIS PROSPECTUS DOES
NOT CONSTITUTE AN OFFER TO SELL OR THE SOLICITATION OF AN OFFER TO BUY
SECURITIES IN ANY JURISDICTION TO ANY PERSON TO WHOM IT IS UNLAWFUL TO MAKE SUCH
OFFER OR SOLICITATION. NEITHER THE DELIVERY OF THIS PROSPECTUS NOR ANY SALE MADE
HEREUNDER SHALL, UNDER ANY CIRCUMSTANCES, CREATE AN IMPLICATION THAT THERE HAS
BEEN NO CHANGE IN AFFAIRS OF THE COMPANY SINCE THE DATE HEREOF OR THEREOF OR
THAT THE INFORMATION CONTAINED HEREIN IS CORRECT AT ANY TIME SUBSEQUENT TO THE
DATE HEREOF OR THEREOF.

UNTIL , 1998 (90 DAYS AFTER THE DATE OF THIS PROSPECTUS), ALL
DEALERS EFFECTING TRANSACTIONS IN THE WARRANTS OR THE WARRANT SHARES, WHETHER OR
NOT PARTICIPATING IN THIS DISTRIBUTION, MAY BE REQUIRED TO DELIVER A PROSPECTUS.
THIS IS IN ADDITION TO THE OBLIGATION OF THE DEALERS TO DELIVER A PROSPECTUS
WHEN ACTING AS UNDERWRITERS AND WITH RESPECT TO THEIR UNSOLD ALLOTMENTS OR
SUBSCRIPTIONS.

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

TABLE OF CONTENTS

<TABLE>
<CAPTION>
PAGE
----
<S> <C>
Available Information................. iii
Disclosure Regarding Forward-Looking
Statements.......................... iii
Prospectus Summary.................... 1
Risk Factors.......................... 7
Use Of Proceeds....................... 17
Capitalization........................ 18
Selected Financial Data............... 19
Management's Discussion and Analysis
of Financial Condition and Results
of Operations....................... 21
Business.............................. 27
Management............................ 47
Certain Transactions.................. 54
Principal Stockholders................ 56
Selling Security Holders.............. 58
Description of Warrants............... 60
Description of Capital Stock.......... 62
Description of the Notes.............. 74
Federal Income Tax Considerations..... 75
Plan of Distribution.................. 77
Legal Matters......................... 78
Experts............................... 78
Index to Financial Statements......... F-1
</TABLE>

- ------------------------------------------------------
- ------------------------------------------------------
- ------------------------------------------------------
- ------------------------------------------------------
PARK 'N VIEW, INC.
---------------------

PROSPECTUS
---------------------
____________, 1998
- ------------------------------------------------------
- ------------------------------------------------------
<PAGE> 99

PART II

INFORMATION NOT REQUIRED IN PROSPECTUS

ITEM 13. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION

Set forth below is an estimate of the approximate amount of the fees and
expenses payable by the Company in connection with the issuance and distribution
of the Securities. All items are estimated except the registration fee.

<TABLE>
<S> <C>
Securities and Exchange Commission Registration Fee......... $ 1,371.53
Printing and Mailing Expenses............................... $ 50,000
-----------
Accounting Fees and Expenses................................ $ 125,000
-----------
Legal Fees and Expenses..................................... $ 125,000
-----------
Miscellaneous............................................... $ 10,000
-----------
Total............................................. $311,371.53
===========
</TABLE>

All of the above expenses have been or will be paid by the Company.

ITEM 14. INDEMNIFICATION OF DIRECTORS AND OFFICERS

Reference is made to Paragraph Eleventh of the Company's Certificate of
Incorporation, which provides as follows:

No director shall be personally liable to the Corporation or its
stockholders for monetary damages for breach of fiduciary duty as a
director; provided, however, that to the extent required by the provisions
of Section 102(b)(7) of the General Corporation Law of the State of
Delaware or any successor statute, or any other laws of the State of
Delaware, this provision shall not eliminate or limit the liability of a
director (i) for any breach of the director's duty of loyalty to the
Corporation or its stockholders, (ii) for acts or omissions not in good
faith or which involve intentional misconduct or a knowing violation of
law, (iii) under Section 174 of the General Corporation Law of the State of
Delaware or (iv) for any transaction from which the director derived an
improper personal benefit. If the General Corporation Law of the State of
Delaware hereafter is amended to authorize the further elimination or
limitation of the liability of directors, then the liability of a director
of the Corporation, in addition to the limitation on personal liability
provided herein, shall be limited to the fullest extent permitted by the
amended General Corporation Law of the State of Delaware. Any repeal or
modification of this paragraph ELEVENTH by the stockholders of the
Corporation shall be prospective only, and shall not adversely affect any
limitation on the personal liability of a director of the Corporation
existing at the time of such repeal or modification.

Reference is made to Section 8.1 of the Company's Amended and Restated
Bylaws, which provides as follows:

To the extent permitted by law, as the same exists or may hereafter be
amended (but, in the case of any such amendment, only to the extent that
such amendment permits the Corporation to provide broader indemnification
rights than said law permitted the Corporation to provide prior to such
amendment) the Corporation shall indemnify any person against any and all
judgments, fines, and amounts paid in settling or otherwise disposing of
actions or threatened actions, and expenses in connection therewith,
incurred by reason of the fact that he, his testator or intestate is or was
a director or officer of the Corporation or of any other corporation of any
type or kind, domestic or foreign, which he served in any capacity at the
request of the Corporation. To the extent permitted by law, expenses so
incurred by any such person in defending a civil or criminal action or
proceeding shall at his request be paid by the Corporation in advance of
the final disposition of such action or proceeding.

II-1
<PAGE> 100

Reference also is made to Section 145 of Title 8 of the Delaware General
Corporation Law, which provides as follows:

145 INDEMNIFICATION OF OFFICERS, DIRECTORS, EMPLOYEES AND AGENTS;
INSURANCE.

(a) A corporation shall have power to indemnify any person who was or
is a party or is threatened to be made a party to any threatened, pending
or completed action, suit or proceeding, whether civil, criminal,
administrative or investigative (other than an action by or in the right of
the corporation) by reason of the fact that the person is or was a
director, officer, employee or agent of the corporation, or is or was
serving at the request of the corporation as a director, officer, employee
or agent of another corporation, partnership, joint venture, trust or other
enterprise, against expenses (including attorneys' fees), judgments, fines
and amounts paid in settlement actually and reasonably incurred by the
person in connection with such action, suit or proceeding if the person
acted in good faith and in a manner the person reasonably believed to be in
or not opposed to the best interests of the corporation, and, with respect
to any criminal action or proceeding, had no reasonable cause to believe
the person's conduct was unlawful. The termination of any action, suit or
proceeding by judgment, order, settlement, conviction, or upon a plea of
nolo contendere or its equivalent, shall not, of itself, create a
presumption that the person did not act in good faith and in a manner which
the person reasonably believed to be in or not opposed to the best
interests of the corporation, and, with respect to any criminal action or
proceeding, had reasonable cause to believe that the person's conduct was
unlawful.

(b) A corporation shall have power to indemnify any person who was or
is a party or is threatened to be made a party to any threatened, pending
or completed action or suit by or in the right of the corporation to
procure a judgment in its favor by reason of the fact that the person is or
was a director, officer, employee or agent of the corporation, or is or was
serving at the request of the corporation as a director, officer, employee
or agent of another corporation, partnership, joint venture, trust or other
enterprise against expenses (including attorneys' fees) actually and
reasonably incurred by the person in connection with the defense or
settlement of such action or suit if the person acted in good faith and in
a manner the person reasonably believed to be in or not opposed to the best
interests of the corporation and except that no indemnification shall be
made in respect of any claim, issue or matter as to which such person shall
have been adjudged to be liable to the corporation unless and only to the
extent that the court of Chancery or the court in which such action or suit
was brought shall determine upon application that, despite the adjudication
of liability but in view of all the circumstances of the case, such person
is fairly and reasonably entitled to indemnity for such expenses which the
Court of Chancery or such other court shall deem proper.

(c) To the extent that a present or former director or officer of a
corporation has been successful on the merits or otherwise in defense of
any action, suit or proceeding referred to in subsections (a) and (b) of
this section, or in defense of any claim, issue or matter therein, such
person shall be indemnified against expenses (including attorneys' fees)
actually and reasonably incurred by such person in connection therewith.

(d) Any indemnification under subsections (a) and (b) of this section
(unless ordered by a court) shall be made by the corporation only as
authorized in the specific case upon a determination that indemnification
of the present or former director, officer, employee or agent is proper in
the circumstances because the person has met the applicable standard of
conduct set forth in subsections (a) and (b) of this section. Such
determination shall be made, with respect to a person who is a director or
officer at the time of such determination, (1) by a majority vote of the
directors who are not parties to such action, suit or proceeding, even
though less than a quorum, or (2) by a committee of such directors
designated by majority vote of such directors, even though less than a
quorum, or (3) if there are no such directors, or if such directors so
direct, by independent legal counsel in a written opinion, or (4) by the
stockholders.

(e) Expenses (including attorneys' fees) incurred by an officer or
director in defending any civil, criminal, administrative or investigative
action, suit or proceeding may be paid by the corporation in
II-2
<PAGE> 101

advance of the final disposition of such action, suit or proceeding upon
receipt of an undertaking by or on behalf of such director or officer to
repay such amount if it shall ultimately be determined that such person is
not entitled to be indemnified by the corporation as authorized in this
section. Such expenses (including attorneys' fees) incurred by former
directors and officers or other employees and agents may be so paid upon
such terms and conditions, if any, as the corporation deems appropriate.

(f) The indemnification and advancement of expenses provided by, or
granted pursuant to, the other subsections of this section shall not be
deemed exclusive of any other rights to which those seeking indemnification
or advancement of expenses may be entitled under any bylaw, agreement, vote
of stockholders or disinterested directors or otherwise, both as to action
in such person's official capacity and as to action in another capacity
while holding such office.

(g) A corporation shall have power to purchase and maintain insurance
on behalf of any person who is or was a director, officer, employee or
agent of the corporation, or is or was serving at the request of the
corporation as a director, officer, employee or agent of another
corporation, partnership, joint venture, trust or other enterprise against
any liability asserted against such person in any such capacity or arising
out of such person's status as such whether or not the corporation would
have the power to indemnify such person against such liability under this
section.

(h) For purposes of this section, references to "the corporation"
shall include, in addition to the resulting corporation, any constituent
corporation (including any constituent of a constituent) absorbed in a
consolidation or merger which, if its separate existence had continued,
would have had power and authority to indemnify its directors, officers,
and employees or agents, so that any person who is or was a director,
officer, employee or agent of such constituent corporation, or is or was
serving at the request of such constituent corporation as a director,
officer, employee or agent of another corporation, partnership, joint
venture, trust or other enterprise, shall stand in the same position under
this section with respect to the resulting or surviving corporation as such
person would have with respect to such constituent corporation if its
separate existence had continued.

(i) For purposes of this section, references to "other enterprises"
shall include employee benefit plans; references to "fines" shall include
any excise taxes assessed on a person with respect to any employee benefit
plan; and references to "serving at the request of the corporation" shall
include any service as a director, officer, employee or agent of the
corporation which imposes duties on, or involves services by, such
director, officer, employee, or agent with respect to an employee benefit
plan, its participants or beneficiaries; and a person who acted in good
faith and in a manner such person reasonably believed to be in the interest
of the participants and beneficiaries of an employee benefit plan shall be
deemed to have acted in a manner "not opposed to the best interests of the
corporation" as referred to in this section.

(j) The indemnification and advancement of expenses provided by, or
granted pursuant to, this section shall, unless otherwise provided when
authorized or ratified, continue as to a person who has ceased to be a
director, officer, employee or agent and shall inure to the benefit of the
heirs, executors and administrators of such a person.

(k) The Court of Chancery is hereby vested with exclusive jurisdiction
to hear and determine all actions for advancement of expenses or
indemnification brought under this section or under any bylaw, agreement,
vote of stockholders or disinterested directors, or otherwise. The Court of
Chancery may summarily determine a corporation's obligation to advance
expenses (including attorneys' fees).

The Company currently intends to obtain liability insurance covering its
executive officers and directors against claims arising from certain acts or
decisions by them in their capacities as executive officers and directors of the
Company, subject to certain exclusions and deductible and maximum amounts, which
may extend to, among other things, liabilities arising under the Securities Act.

II-3
<PAGE> 102

ITEM 15. RECENT SALES OF UNREGISTERED SECURITIES

Since July 1, 1995, the Company has sold and issued the following
securities on the date and for the consideration referenced below:

(1) In November 1995, the Company, which was organized by Patricof,
Ian Williams and the then-partners of Park 'N View, Ltd. (Sam Hashman,
Monte Nathanson and Nelgo Investments, of which Daniel O'Connell is a
general partner), acquired the business and assets, and assumed the
liabilities, of Park 'N View, Ltd. In connection with such purchase, the
Company issued 2,300,000 million shares of Common Stock to Park 'N View,
Ltd. Park 'N View, Ltd. subsequently distributed such shares to its
partners. The amount of the net liabilities assumed by the Company was
$84,446, including a promissory note of Park 'N View, Ltd., to Sam Hashman
in the principal amount of $150,000, which was subsequently paid in full by
the Company.

(2) During the 12-month period commencing in November 1995, certain
investment limited partnerships managed by Patricof & Co. Ventures, Inc.
(the "Patricof Managed Funds") invested $3,800,000 in the Company in
exchange for which the Company issued to the Patricof Managed Funds
2,000,000 shares of Common Stock, 70,010 shares of Series A Preferred Stock
and $3,000,000 aggregate principal amount of the Company's 8% Subordinated
Notes.

(3) In August 1996, the Patricof Managed Funds invested $1,500,000 in
the Company in exchange for which the Company issued to the Patricof
Managed Funds $1,500,000 aggregate principal amount of the Company's 8%
Subordinated Notes and warrants to purchase 239,250 shares of Common Stock
at an exercise price of $0.01 per share.

(4) In November 1996, the Company issued an aggregate of 1,235,133
shares of Series B Preferred Stock to seven investors for an aggregate
consideration of $13,500,000.

(5) In November 1996, in connection with the sale of the Series B
Preferred Stock described above, (i) the Patricof Managed Funds (a)
converted $3,000,000 aggregate principal amount of the Company's 8%
Subordinated Notes plus $180,000 in interest accrued thereon into 318,065
shares of the Series A Preferred Stock, and (b) converted $1,500,000
aggregate principal amount of such notes, and warrants to purchase 239,250
shares of Common Stock at an exercise price of $0.01 per share, into
137,237 shares of the Series B Preferred Stock.

(6) In August 1997, the Company issued an aggregate of 2,328,543
shares of Series C Preferred Stock to thirty-five investors for an
aggregate consideration of $18,628,344.

(7) In August 1997, the Company issued to BT Alex. Brown Incorporated
warrants to purchase an aggregate of 100,399 shares of Common Stock at an
exercise price of $8.00 per share in consideration for services provided by
BT Alex. Brown Incorporated in connection with the sale of the Series C
Preferred Stock described above.

(8) In March 1998, the Company issued a warrant to purchase an
aggregate of up to 180,000 shares of Common Stock at an exercise price of
$8.00 per share in connection with the Company entering into a contractual
arrangement with the warrantholder.

(9) In May 1998, the Company sold to Donaldson, Lufkin & Jenrette
Securities Corporation 75,000 Units for an aggregate consideration of $71.5
million (net of discounts and commissions) pursuant to a Securities
Purchase Agreement, dated May 27, 1998.

The sales and issuances of securities in the above transactions were made
in reliance on the exemptions from registration under the Securities Act of
1933, as amended (the "Securities Act"), provided by Section 4(2) thereof and/or
Regulation D thereunder. The purchasers in each case represented their intention
to acquire the securities for investment only and not with a view to the
distribution thereof. Appropriate legends were affixed to the stock certificates
issued in such transactions. Similar representations of investment intent were
obtained and similar legends imposed in connection with any subsequent transfers
of such

II-4
<PAGE> 103

securities. The Company believes that all recipients had adequate access,
through employment or other relationships, to information about the Company to
make an informed investment decision.

In addition, from August 30, 1996 to June 10, 1997, the Company issued an
aggregate of 409,846 options to purchase Common Stock with exercise prices
ranging from $1.00 to $3.00 per share under the Stock Option Plan for an
aggregate exercise price of $582,385 in reliance on the exemption from
registration under the Securities Act provided by Rule 701. For additional
information concerning these transactions, reference is made to the information
contained under the caption "Management -- Stock Option Plan" in the form of the
Prospectus included herein.

ITEM 16. EXHIBITS AND FINANCIAL STATEMENT SCHEDULES

(a) Exhibits.

<TABLE>
<CAPTION>
EXHIBIT NO. DESCRIPTION OF EXHIBIT
- ----------- ----------------------
<S> <C> <C>
3.1* -- Amended and Restated Certificate of Incorporation, dated
October 30, 1995, of Park 'N View, Inc.(the "Company").
3.2* -- Certificate of Amendment of the Certificate of
Incorporation, dated November 12, 1996, of the Company.
3.3* -- Certificate of Amendment of the Certificate of
Incorporation, dated August 22, 1997, of the Company.
3.4* -- Certificate of Amendment Relating to the Series A Preferred
Stock, dated May 7, 1998, of the Company.
3.5* -- Certificate of Amendment to Certificate of Designations,
Preferences and Rights of Series B 7% Cumulative Convertible
Preferred Stock, dated May 7, 1998, of the Company.
3.6* -- Certificate of Amendment to Certificate of Designations,
Preferences and Rights of Series C 7% Cumulative Convertible
Preferred Stock, dated May 7, 1998, of the Company.
3.7* -- Amended and Restated By-laws of the Company.
4.1* -- Indenture, dated as of May 27, 1998, by and between the
Company and State Street Bank and Trust Company, as trustee.
4.2** -- Warrant Agreement, dated as of May 27, 1998, by and between
the Company and State Street Bank and Trust Company, as
warrant agent.
4.3** -- Warrant Registration Rights Agreement, dated as of May 27,
1998, by and between the Company and Donaldson, Lufkin &
Jenrette Securities Corporation.
5.1 -- Opinion of Kilpatrick Stockton LLP.
10.1* -- Fleet Service Agreement, dated as of January 28, 1997, by
and between the Company and Trucks For You.
10.2* -- Fleet Service Agreement, dated as of February 1, 1998, by
and between the Company and Carroll Fulmer & Co., Inc.
10.3* -- Fleet Service Agreement, dated as of March 1, 1998, by and
between the Company and Contract Freighters, Inc.
10.4* -- Fleet Service Agreement, dated as of March 11, 1998, by and
between the Company and Lake City Express.
10.5* -- Fleet Service Agreement, dated as of April 1, 1998, by and
between the Company and Top Gun Transport, Inc.
10.6* -- Cable Television and Telephone Service Agreement, dated as
of August 14, 1995, by and between the Company and AMBEST.
10.7* -- Cable Television and Telephone Service Agreement, dated as
of July 11, 1996, by and between the Company and
Professional Transportation Partners, LLC.
10.8* -- Cable Television and Telephone Service Agreement, dated as
of March 18, 1997, by and between the Company and North
America Truck Stop Network.
10.9* -- Cable Television and Telephone Service Agreement, dated as
of October 28, 1995, by and between the Company and Travel
Ports of America, Inc.
</TABLE>

II-5
<PAGE> 104

<TABLE>
<CAPTION>
EXHIBIT NO. DESCRIPTION OF EXHIBIT
- ----------- ----------------------
<S> <C> <C>
10.10* -- Cable Television and Telephone Service Agreement, dated as
of February 15, 1996, by and between the Company and Pilot
Corporation.
10.11* -- Cable Television and Telephone Service Agreement, dated as
of February 7, 1997, by and between the Company and All
American Plazas, Inc.
10.12* -- Cable Television and Telephone Service Agreement, dated as
of September 12, 1997, by and between the Company and Petro
Stopping Centers, L.P.
10.13*+ -- Cable Television and Telephone Service Agreement, dated
March 12, 1998 by and between the Company and TA Operating
Corporation d/b/a Travel Centers of America.
10.14* -- Lease, dated August 11, 1997, between Unipower Corporation
and the Company.
10.15* -- Software Development Agreement, dated November 22, 1995,
between the Company and GreenLight Technologies, Inc.
10.16* -- Technology Transfer and Development Agreement, dated as of
November 4, 1996, by and among GreenLight, Inc., Jody Green,
Lewis Tatham and the Company.
10.17* -- Customer Agreement, dated December 17, 1997, by and between
the Company and Echostar Satellite Corporation.
10.18* -- Compensation Plan of the Company.
10.19* -- Stock Option Plan of the Company.
10.20* -- Securities Purchase Agreement Subordinated Notes, Series A
Preferred Stock and Common Stock, dated as of November 2,
1995, by and among the Company and the Purchasers named
therein.
10.21* -- Letter Agreement, dated as of May 18, 1998, by and among the
Company and certain holders of the Company's Series A
Preferred Stock.
10.22* -- Securities Restriction Agreement, dated as of November 2,
1995, by and among the Company and the Investors named
therein.
10.23* -- Stock Purchase Agreement Series B 7% Cumulative Convertible
Preferred Stock, dated as of November 13, 1996, by and among
the Company and the Purchasers named therein.
10.24* -- Securities Restriction Agreement, dated as of November 13,
1996, by and among the Company and the Investors named
therein.
10.25* -- Amended and Restated Securityholders' Agreement and Exchange
Agreement, dated as of November 13, 1996, by and among the
Company and the Investors named therein.
10.26* -- Registration Rights Agreement, dated as of November 13,
1996, by and among the Company and the Investors named
therein.
10.27* -- Stock Purchase Agreement Series C 7% Cumulative Convertible
Preferred Stock, dated as of August 22, 1997, by and among
the Company and the Purchasers named therein.
10.28* -- Amendment to Securities Restriction Agreement, dated as of
August 22, 1997, by and among the Company and the Investors
named therein.
10.29* -- Amendment to Amended and Restated Securityholders' Agreement
and Exchange Agreement, dated as of August 22, 1997, by and
among the Company and the Investors named therein.
10.30* -- Amendment to Registration Rights Agreement, dated as of
August 22, 1997, by and among the Company and the Investors
named therein.
10.31* -- Letter Agreement, dated as of May 20, 1998, by and among the
Company and certain parties to the Registration Rights
Agreement, dated as of November 13, 1996, as amended.
10.32* -- Pledge, Escrow and Disbursement Agreement, dated as of May
27, 1998, by and between the Company and State Street Bank
and Trust Company, as trustee and escrow agent.
10.33* -- Warrant, dated as of August 22, 1997, granted to Alex. Brown
& Sons Incorporated.
10.34* -- Warrant, dated as of August 22, 1997, granted to Alex. Brown
& Sons Incorporated.
10.35*+ -- Warrant, dated March 12, 1998.
10.36*+ -- Letter Agreement, dated as of May 18, 1998, by and between
the Company and a holder of warrants to purchase shares of
the Company's Common Stock.
10.37*+ -- AT&T Custom Offer Order Form, by and between the Company and
AT&T.
</TABLE>

II-6
<PAGE> 105

<TABLE>
<CAPTION>
EXHIBIT NO. DESCRIPTION OF EXHIBIT
- ----------- ----------------------
<S> <C> <C>
10.38* -- Form of AT&T Contract Tariff Order Form, by and between the
Company and AT&T.
12.1 -- Statement regarding Computation of Ratios.
23.1 -- Consent of Kilpatrick Stockton LLP (included in Exhibit 5.1)
23.2 -- Consent of Deloitte & Touche LLP.
23.3 -- Consent of Fletcher Spaght, Inc.
27.1 -- Financial Data Schedule (for SEC use only).
</TABLE>

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

* Incorporated by reference to the corresponding exhibit filed with the
Company's Registration Statement on Form S-4 filed with the Securities and
Exchange Commission immediately prior to the filing of this Registration
Statement.

** Previously filed.

+ Portions of this Exhibit are omitted and filed separately with the Securities
and Exchange Commission pursuant to a request for confidential treatment.

(b) Financial Statement Schedules. Financial statement schedules have been
omitted since the required information is not present, or not present in amounts
sufficient to require submission of the schedule, or because the information is
included in the financial statements or notes thereto.

ITEM 17. UNDERTAKINGS.

(a) The Registrant hereby undertakes:

(1) To file, during any period in which offers or sales are being
made, a post-effective amendment to this registration statement:

(i) To include any prospectus required by section 10(a)(3) of the
Securities Act of 1933;

(ii) To reflect in the prospectus any facts or events arising after
the effective date of the registration statement (or the most recent
post-effective amendment thereof) which, individually or in the
aggregate, represent a fundamental change in the information set forth
in the registration statement. Notwithstanding the foregoing, any
increase or decrease in volume of securities offered (if the total
dollar value of securities offered would not exceed that which was
registered) and any deviation from the low or high end of the estimated
maximum offering range may be reflected in the form of prospectus filed
with the Commission pursuant to Rule 424(b) if, in the aggregate, the
changes in volume and price represent no more than a 20% change in the
maximum aggregate offering price set forth in the "Calculation of
Registration Fee" table in the effective registration statement;

(iii) To include any material information with respect to the plan
of distribution not previously disclosed in the registration statement
or any material change to such information in the registration
statement.

(2) That, for the purpose of determining any liability under the
Securities Act of 1933, each such post-effective amendment shall be deemed
to be a new registration statement relating to the securities offered
therein, and the offering of such securities at that time shall be deemed
to be the initial bona fide offering thereof.

(3) To remove from registration by means of a post-effective amendment
any of the securities being registered which remain unsold at the
termination of the offering.

(b) Insofar as indemnification for liabilities arising under the Securities
Act may be permitted to directors, officers and controlling persons of the
Registrant pursuant to the foregoing provisions, or otherwise, the Registrant
has been advised that in the opinion of the Securities and Exchange Commission
such indemnifications against public policy as expressed in the Securities Act
and is, therefore, unenforceable. In the event that a claim for indemnification
against such liabilities (other than the payment by the Registrant of expenses
incurred or paid by a director, officer or controlling person of the Registrant
in the successful defense of any action, suit or proceedings) is asserted by
such director, officer or controlling person in connection with the securities
being registered, the Registrant will, unless in the opinion of its counsel the
matter has been settled by controlling precedent, submit to a court of
appropriate jurisdiction the question whether such indemnification by it is
against public policy as expressed in the Securities Act and will be governed by
the final adjudication of such issue.

II-7
<PAGE> 106

SIGNATURES

Pursuant to the requirements of the Securities Act of 1933, the Registrant
has duly caused this registration statement to be signed on its behalf by the
undersigned, thereunto duly authorized, in the City of Coral Springs, State of
Florida, on September 21, 1998.

PARK 'N VIEW, INC.,

By: /s/ STEPHEN L. CONKLING

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

Stephen L. Conkling

President and Chief Operating
Officer

Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement has been signed by the following persons on the 21st day
of September, 1998, in the capacities indicated.

<TABLE>
<CAPTION>
SIGNATURE POSITION
--------- --------
<C> <S>

/s/ IAN WILLIAMS Chairman of the Board, Chief Executive Officer
- ----------------------------------------------------- and Director (Principal Executive Officer)
Ian Williams

/s/ R. MICHAEL BREWER Vice President-Finance and Chief Financial
- ----------------------------------------------------- Officer (Principal Financial and Accounting
R. Michael Brewer Officer)

* Director
- -----------------------------------------------------
Robert M. Chefitz

* Director
- -----------------------------------------------------
Thomas P. Hirschfeld

* Director
- -----------------------------------------------------
Richard M. Johnston

* Director
- -----------------------------------------------------
Daniel K. O'Connell

* Director
- -----------------------------------------------------
David C. Turner
</TABLE>

* By: /s/ STEPHEN L. CONKLING

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

Stephen L. Conkling

Attorney-in-Fact

II-8
<PAGE> 107

EXHIBIT INDEX

<PAGE> 108

<TABLE>
<CAPTION>
EXHIBIT NO. DESCRIPTION OF EXHIBIT
- ----------- ----------------------
<S> <C> <C>
10.17* -- Customer Agreement, dated December 17, 1997, by and between
the Company and Echostar Satellite Corporation.
10.18* -- Compensation Plan of the Company.
10.19* -- Stock Option Plan of the Company.
10.20* -- Securities Purchase Agreement Subordinated Notes, Series A
Preferred Stock and Common Stock, dated as of November 2,
1995, by and among the Company and the Purchasers named
therein.
10.21* -- Letter Agreement, dated as of May 18, 1998, by and among the
Company and certain holders of the Company's Series A
Preferred Stock.
10.22* -- Securities Restriction Agreement, dated as of November 2,
1995, by and among the Company and the Investors named
therein.
10.23* -- Stock Purchase Agreement Series B 7% Cumulative Convertible
Preferred Stock, dated as of November 13, 1996, by and among
the Company and the Purchasers named therein.
10.24* -- Securities Restriction Agreement, dated as of November 13,
1996, by and among the Company and the Investors named
therein.
10.25* -- Amended and Restated Securityholders' Agreement and Exchange
Agreement, dated as of November 13, 1996, by and among the
Company and the Investors named therein.
10.26* -- Registration Rights Agreement, dated as of November 13,
1996, by and among the Company and the Investors named
therein.
10.27* -- Stock Purchase Agreement Series C 7% Cumulative Convertible
Preferred Stock, dated as of August 22, 1997, by and among
the Company and the Purchasers named therein.
10.28* -- Amendment to Securities Restriction Agreement, dated as of
August 22, 1997, by and among the Company and the Investors
named therein.
10.29* -- Amendment to Amended and Restated Securityholders' Agreement
and Exchange Agreement, dated as of August 22, 1997, by and
among the Company and the Investors named therein.
10.30* -- Amendment to Registration Rights Agreement, dated as of
August 22, 1997, by and among the Company and the Investors
named therein.
10.31* -- Letter Agreement, dated as of May 20, 1998, by and among the
Company and certain parties to the Registration Rights
Agreement, dated as of November 13, 1996, as amended.
10.32* -- Pledge, Escrow and Disbursement Agreement, dated as of May
27, 1998, by and between the Company and State Street Bank
and Trust Company, as trustee and escrow agent.
10.33* -- Warrant, dated as of August 22, 1997, granted to Alex. Brown
& Sons Incorporated.
10.34* -- Warrant, dated as of August 22, 1997, granted to Alex. Brown
& Sons Incorporated.
10.35*+ -- Warrant, dated March 12, 1998.
10.36*+ -- Letter Agreement, dated as of May 18, 1998, by and between
the Company and a holder of warrants to purchase shares of
the Company's Common Stock.
10.37*+ -- AT&T Custom Offer Order Form, by and between the Company and
AT&T.
10.38* -- Form of AT&T Contract Tariff Order Form, by and between the
Company and AT&T.
12.1 -- Statement regarding Computation of Ratios.
23.1 -- Consent of Kilpatrick Stockton LLP (included in Exhibit 5.1)
23.2 -- Consent of Deloitte & Touche LLP.
23.3 -- Consent of Fletcher Spaght, Inc.
27.1 -- Financial Data Schedule (for SEC use only).
</TABLE>

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

** Previously filed.

+ Portions of this Exhibit are omitted and filed separately with the Securities
and Exchange Commission pursuant to a request for confidential treatment.

<PAGE> 1

Exhibit 5.1

Attorneys at Law
Suite 400
KILPATRICK STOCKTON LLP 4101 Lake Boone Trail
Raleigh, North Carolina 27607-6519
Telephone: 919.420.1700
Facsimile: 919.420.1800

September 18, 1998

Park `N View, Inc.
11711 N.W. 39th Street
Coral Springs, Florida 33065

Re: Registration Statement on Form S-1 (No. 333-59903)

Ladies and Gentlemen:

We have acted as counsel to Park `N View, Inc., a Delaware
corporation (the "Company"), in connection with a Registration Statement on Form
S-1 (the "Registration Statement") filed with the Securities and Exchange
Commission under the Securities Act of 1933, as amended (the "Act"), relating to
(i) the offering for resale from time to time by certain selling security
holders named in the prospectus included in the Registration Statement or in
supplements thereto of an aggregate of 75,000 warrants (the "Warrants") to
purchase an aggregate of 505,375 shares (as such number may be adjusted from
time to time in accordance with the terms of the Warrants, the "Warrant Shares")
of the Company's Common Stock, par value $.001 per share (the "Common Stock"),
(ii) the offering for resale from time to time of the Warrant Shares by the
initial investors in the 75,000 units consisting of $75,000,000 aggregate
principal amount of 13% Senior Notes due 2008 of the Company and 75,000
Warrants, and (iii) the offer and sale by the Company of the Warrant Shares to
transferees of such initial investors upon exercise of the Warrants by such
transferees.

We have participated in the preparation of the Registration Statement
and have reviewed originals or copies, certified or otherwise identified to our
satisfaction, of such documents and records of the Company and such other
instruments and other certificates of public officials, officers and
representatives of the Company and such other persons, and we have made such
investigations of law, as we have deemed appropriate as a basis for the opinions
expressed below, including the Certificate of Incorporation, as amended, the
By-laws of the Company, and the Warrant Agreement, dated May 27, 1998 (the
"Warrant Agreement"), between the Company and State Street Bank and Trust
Company, as warrant agent.

In rendering the opinions expressed below, we have assumed the
authenticity of all documents submitted to us as originals and the conformity to
the originals of all documents

<PAGE> 2

KILPATRICK STOCKTON LLP

Park `N View, Inc.
September 18, 1998
Page 2

submitted to us as copies. In addition, we have assumed and have not verified
the accuracy as to factual matters of each document we have reviewed.

Based on the foregoing, and subject to the further assumptions and
qualifications set forth below, it is our opinion that:

1. The Warrants have been validly issued, fully paid and
non-assessable and constitute valid and legally binding obligations of the
Company enforceable in accordance with their terms and the terms of the Warrant
Agreement.

2. The Warrant Shares have been duly authorized for issuance by the
Company and, when issued upon exercise of the Warrants in accordance with the
terms thereof, will be validly issued, fully paid and non-assessable.

Insofar as the foregoing opinions relate to the legality, validity or
binding effect of any agreement or obligation of the Company, (a) we have
assumed that each party to such agreement or obligation has satisfied those
legal requirements that are applicable to it to the extent necessary to make
such agreement or obligation enforceable against it; (b) such opinions are
subject to applicable bankruptcy, insolvency, fraudulent conveyance and similar
laws affecting creditors' rights generally and to general principles of equity;
and (c) we express no opinion as to sections of the Warrant Agreement which
pertain to severability of illegal provisions or waiver of protection under
stay, extension or usury laws.

We are licensed in the State of North Carolina. Our opinions are
limited to the laws of the State of North Carolina and the applicable laws of
the State of Delaware, and we express no opinion concerning the laws of any
other jurisdiction.

We hereby consent to the filing of this opinion as an exhibit to the
Registration Statement and to the reference to this firm under the heading
"Legal Matters" in the Prospectus included in the Registration Statement. In
giving such consent, we do not thereby admit that we are "experts" within the
meaning of the Act or the rules and regulations of the Securities and Exchange
Commission issued thereunder with respect to any part of the Registration
Statement, including this exhibit.

Very truly yours,

/s/ Kilpatrick Stockton LLP

<PAGE> 1

EXHIBIT 12.1

PARK'N VIEW, INC.
COMPUTATION OF DEFICIENCY OF EARNINGS TO FIXED CHARGES

PERIOD FROM
SEPTEMBER 18,
1995 (DATE OF
INCORPORATION)
TO JUNE 30, YEAR ENDED YEAR ENDED
1996 JUNE 30, 1997 JUNE 30, 1998
-------------- ------------- ------------
<S> <C> <C> <C>
Net loss $ (1,961,237) $(6,045,020) $(13,733,747)

Preferred stock dividends (21,370) (852,850) (2,495,932)

Amortization of preferred stock
Issuance costs -- (64,432) (296,605)
------------ ----------- ------------
Deficiency of earnings to fixed charges
and preferred stock dividend requirements (1) $ (1,982,607) $(6,962,402) $(16,526,284)
============ =========== ============

</TABLE>
(1) Because of the Company's historic losses, the Company has experienced a
deficiency of earnings to fixed charges throughout its existence. Fixed charges
consist of preferred stock dividends and amortization of preferred stock
issuance costs.

<PAGE> 1

EXHIBIT 23.2

INDEPENDENT AUDITORS' CONSENT

We consent to the use in this Amendment No. 1 to Registration Statement No.
333-59903 of Park 'N View, Inc. on Form S-1 of our report dated September 11,
1998, appearing in the Prospectus, which is part of this Registration Statement.
We also consent to the reference to us under the heading "Experts" in such
Prospectus.

DELOITTE & TOUCHE LLP
Fort Lauderdale, Florida
September 18, 1998

<PAGE> 1

EXHIBIT 23.3

CONSENT

We hereby consent to the reference to the market assessment of the number
of long-haul truck drivers performed by Fletcher Spaght, Inc., for Park 'N
View, Inc. (the "Company") in the Company's registration statement on Form S-4.

FLETCHER SPAGHT, INC.

By: /s/ John Fletcher
Name: John Fletcher
Title: Chief Executive Officer

Date: September 18, 1998

<ARTICLE> 5

<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE BALANCE
SHEETS AT JUNE 30, 1997 AND JUNE 30, 1998 AND THE STATEMENTS OF OPERATIONS FOR
THE YEAR ENDED JUNE 30, 1997 AND THE YEAR ENDED JUNE 30, 1998 AND IS QUALIFIED
IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>

<S> <C> <C>
<PERIOD-TYPE> YEAR YEAR
<FISCAL-YEAR-END> JUN-30-1997 JUN-30-1998
<PERIOD-START> JUL-01-1996 JUL-01-1997
<PERIOD-END> JUN-30-1997 JUN-30-1998
<CASH> 4,717,394 19,810,656
<SECURITIES> 0 51,302,916
<RECEIVABLES> 16,937 189,580
<ALLOWANCES> 5,411 5,410
<INVENTORY> 259,825 362,738
<CURRENT-ASSETS> 5,127,358 71,761,367
<PP&E> 8,267,235 21,079,307
<DEPRECIATION> 616,482 2,630,706
<TOTAL-ASSETS> 12,938,783 94,578,127
<CURRENT-LIABILITIES> 2,313,814 5,109,226
<BONDS> 0 0
3,931,320 4,301,345
15,200,146 34,832,579
<COMMON> 4,318 4,318
<OTHER-SE> (8,936,245) (20,274,081)
<TOTAL-LIABILITY-AND-EQUITY> 12,938,783 94,578,127
<SALES> 888,397 3,503,776
<TOTAL-REVENUES> 888,397 3,503,776
<CGS> 2,077,689 6,598,993
<TOTAL-COSTS> 2,077,689 6,598,993
<OTHER-EXPENSES> 4,431,889 10,378,471
<LOSS-PROVISION> 594,691 35,151
<INTEREST-EXPENSE> (170,852) 224,905
<INCOME-PRETAX> (6,045,020) (13,733,747)
<INCOME-TAX> 0 0
<INCOME-CONTINUING> (6,045,020) (13,733,747)
<DISCONTINUED> 0 0
<EXTRAORDINARY> 0 0
<CHANGES> 0 0
<NET-INCOME> (6,045,020) (13,733,747)
<EPS-PRIMARY> (1.61) (3.83)
<EPS-DILUTED> (1.61) (3.83)

</TABLE>