ONSITE ACCESS INC, S-1, 1999-12-15

ONSITE ACCESS INC
S-1, 1999-12-15

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<PAGE>

AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON DECEMBER 15, 1999
REGISTRATION NO. 333-
________________________________________________________________________________
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
------------------------

FORM S-1
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
------------------------
ONSITE ACCESS, INC.
(EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)

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<S> <C> <C>
DELAWARE 4813 13-4076396
(STATE OR OTHER JURISDICTION OF (PRIMARY STANDARD INDUSTRIAL (I.R.S. EMPLOYER
INCORPORATION OR ORGANIZATION) CLASSIFICATION CODE NUMBER) IDENTIFICATION NO.)
</TABLE>

1372 BROADWAY
NEW YORK, NEW YORK 10018
(212) 324-1500
(ADDRESS, INCLUDING ZIP CODE, AND TELEPHONE NUMBER,
INCLUDING AREA CODE, OF REGISTRANT'S PRINCIPAL EXECUTIVE OFFICES)
------------------------
KENNETH J. HALL
EXECUTIVE VICE PRESIDENT AND CHIEF FINANCIAL OFFICER
ONSITE ACCESS, INC.
1372 BROADWAY
NEW YORK, NEW YORK 10018
(212) 324-1500
(NAME, ADDRESS, INCLUDING ZIP CODE, AND TELEPHONE NUMBER,
INCLUDING AREA CODE, OF AGENT FOR SERVICE)
------------------------
COPIES TO:

<TABLE>
<S> <C>
LEE S. PARKS, ESQ. WILLIAM J. WHELAN, III, ESQ.
STEVEN G. SCHEINFELD, ESQ. CRAVATH, SWAINE & MOORE
FRIED, FRANK, HARRIS, SHRIVER & JACOBSON WORLDWIDE PLAZA
ONE NEW YORK PLAZA 825 EIGHTH AVENUE
NEW YORK, NEW YORK 10004-1980 NEW YORK, NEW YORK 10019-7475
(212) 859-8000 (212) 474-1000
</TABLE>

------------------------
APPROXIMATE DATE OF COMMENCEMENT OF PROPOSED SALE TO THE PUBLIC: As soon as
practicable after this 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,
check the following box. [ ]

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

If delivery of the prospectus is expected to be made pursuant to Rule 434,
check the following box. [ ]
------------------------
CALCULATION OF REGISTRATION FEE

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<S> <C> <C>
PROPOSED MAXIMUM
AGGREGATE
TITLE OF EACH CLASS OF SECURITIES OFFERING AMOUNT OF
TO BE REGISTERED PRICE(1) REGISTRATION FEE
---------------- -------- -----------------
Common Stock, $0.001 par value per share.................... $200,000,000 $52,800
</TABLE>

(1) Estimated solely for the purpose of calculating the registration fee
pursuant to Rule 457(o) under the Securities Act of 1933.
------------------------
THE REGISTRANT HEREBY AMENDS THE 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.

________________________________________________________________________________

<PAGE>

THE INFORMATION IN THIS PRELIMINARY PROSPECTUS IS NOT COMPLETE AND MAY BE
CHANGED. WE MAY NOT SELL THESE SECURITIES UNTIL THE REGISTRATION STATEMENT FILED
WITH THE SECURITIES AND EXCHANGE COMMISSION IS EFFECTIVE. THIS PRELIMINARY
PROSPECTUS IS NOT AN OFFER TO SELL THESE SECURITIES AND IT IS NOT SOLICITING AN
OFFER TO BUY THESE SECURITIES IN ANY STATE WHERE THE OFFER OR SALE IS NOT
PERMITTED.

SUBJECT TO COMPLETION, DATED DECEMBER 15, 1999

PRELIMINARY PROSPECTUS

SHARES
[LOGO]
ONSITE ACCESS, INC.
COMMON STOCK

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

We are selling shares of common stock. The underwriters named in
this prospectus may purchase up to additional shares of common stock from
us to cover over-allotments.

This is an initial public offering of common stock. We expect the initial
public offering price to be between $ and $ per share, and will
apply to have the common stock included for quotation on the Nasdaq National
Market under the symbol 'OSAX'.

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

INVESTING IN OUR COMMON STOCK INVOLVES RISKS. SEE 'RISK FACTORS' BEGINNING
ON PAGE 6.

Neither the Securities and Exchange Commission nor any state securities
commission has approved or disapproved these securities or determined if this
prospectus is truthful or complete. Any representation to the contrary is a
criminal offense.

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

<TABLE>
<CAPTION>
PER SHARE TOTAL
--------- -----------
<S> <C> <C>
Public Offering Price....................................... $ $
Underwriting Discount....................................... $ $
Proceeds to OnSite Access, Inc. (before expenses)........... $ $
</TABLE>

The underwriters are offering the shares subject to various conditions. The
underwriters expect to deliver the shares to purchasers on or about
, 2000.

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

JOINT LEAD MANAGERS

SALOMON SMITH BARNEY J.P. MORGAN & CO.
------------------------
CIBC WORLD MARKETS THOMAS WEISEL PARTNERS LLC

, 2000

<PAGE>

INSIDE FRONT COVER
[artwork]

<PAGE>

YOU SHOULD RELY ONLY ON THE INFORMATION CONTAINED IN THIS PROSPECTUS. WE
HAVE NOT AUTHORIZED ANYONE TO PROVIDE YOU WITH DIFFERENT INFORMATION. WE ARE NOT
MAKING AN OFFER OF THESE SECURITIES IN ANY STATE WHERE THE OFFER IS NOT
PERMITTED. YOU SHOULD NOT ASSUME THAT THE INFORMATION PROVIDED BY THIS
PROSPECTUS IS ACCURATE AS OF ANY DATE OTHER THAN THE DATE ON THE FRONT COVER OF
THIS PROSPECTUS.

- ------------------------
TABLE OF CONTENTS

<TABLE>
<CAPTION>
PAGE
----
<S> <C>
Prospectus Summary.......................................... 2
Summary Financial Information............................... 5
Risk Factors................................................ 6
Cautionary Notice Regarding Forward-Looking Statements...... 18
Use of Proceeds............................................. 19
Dividend Policy............................................. 19
Capitalization.............................................. 20
Dilution.................................................... 21
Selected Financial Data..................................... 22
Management's Discussion and Analysis of Financial Condition
and Results of Operations................................. 24
Business.................................................... 32
Management.................................................. 45
Certain Transactions........................................ 54
Principal Stockholders...................................... 56
Description of Capital Stock................................ 59
Shares Eligible For Future Sale............................. 62
United States Tax Consequences to Non-United States
Holders................................................... 64
Underwriting................................................ 67
Legal Matters............................................... 69
Experts..................................................... 69
Where You Can Find More Information......................... 69
Index to Consolidated Financial Statements.................. F-1
</TABLE>

Until , 2000 (25 days after the date of this prospectus), all
dealers that buy, sell or trade the common stock, whether or not participating
in this offering, may be required to deliver a prospectus. This delivery
requirement is in addition to the obligation of dealers to deliver a prospectus
when acting as underwriters and with respect to their unsold allotments or
subscriptions.

<PAGE>

PROSPECTUS SUMMARY

This summary highlights information contained elsewhere in this prospectus.
This summary is not complete and does not contain all of the information that
you should consider before investing in our common stock. You should read the
entire prospectus carefully.

Unless otherwise indicated, all references in this prospectus give effect
to the conversion of our existing outstanding Series A, Series C and Series D
preferred stock into common stock on a one-for-one basis and the conversion of
our outstanding Series B preferred stock into common stock at the initial public
offering price, immediately prior to the completion of this offering, and do not
include the number of shares that we will issue if the underwriters exercise
their over-allotment option.

OUR BUSINESS

We provide comprehensive communications solutions for small and
medium-sized business customers in multi-tenant commercial office buildings. We
offer an integrated and scalable suite of voice, data and enhanced services
delivered through in-building broadband communications networks that we own and
operate. Our offerings include local and long distance voice services, high
speed Internet access, data networking and enhanced services.

We began offering services in the New York metropolitan area in September
1997. To date, we have contracts with real estate owners to offer our services
in buildings representing approximately million rentable square feet of
commercial office space and have 103 buildings in service representing
approximately 23.8 million rentable square feet. We are also developing a
nationwide data network and have constructed 10 data network access points to
serve up to 22 metropolitan areas. We intend to offer our services in up to 50
metropolitan areas over the next two to three years.

OUR STRATEGY

Our objective is to be the complete communications solutions provider to
small and medium-sized business customers in multi-tenant commercial office
buildings within our markets. To achieve our objective, we use the following
strategies:

Offer a bundled package of communications services. We provide a full
suite of communications services including voice, data and enhanced
services billed in a single invoice for customer convenience.

Establish lasting relationships with our customers. We deliver responsive,
high quality service and customer care on a personalized basis to foster
lasting relationships with our customers.

Create new distribution channels to address our customers' communications
and Internet needs. We plan to expand our service offerings to include new
broadband and web-based services. We plan to develop web portals designed
for individual buildings through which we will provide value added
services for our customers and real estate owners.

Partner with real estate owners. We establish mutually beneficial
relationships with real estate owners to facilitate our access to
buildings and penetration of our target customer base.

To implement these strategies, we have designed and begun deployment of a
high speed communications network architecture that addresses the current and
expected voice, data and enhanced services needs of our small and medium-sized
business customers. We plan to invest in, own and control network facilities
only when we believe that such investment provides competitive cost and
performance advantages. We believe our network architecture is:

Flexible. We install both copper and fiber-optic cabling to every floor of
a served building, allowing us to offer high speed data services through
either copper or fiber-based technologies on a customer by customer basis.

<PAGE>

Cost effective. We achieve economies of scale in providing high-speed data
services to small and medium-sized business customers because we aggregate
demand from many smaller enterprises within a building while creating
operating efficiencies through our building-centric network and service
approach.

Capital efficient. We deploy digital subscriber line equipment immediately
within our served buildings and allow for demand-driven deployment of more
expensive fiber-optic electronics as customer usage of high-bandwidth
communications services increases.

Scalable. We believe we will be able to provide value-added application
services such as e-commerce or business applications outsourcing to our
customers because we are constructing a reliable, high speed nationwide
network of data switching equipment, application servers and leased
communications capacity to link our served buildings.

We believe that our building-centric approach provides for capital and
operating efficiencies through the deployment of an in-building broadband
network and allows our sales and marketing effort to focus on a concentrated
base of target customers within a building.

OUR SOLUTION

Comprehensive communications solutions. We offer scalable solutions
designed to meet the voice, data and enhanced communications services
needs of small and medium-sized business customers. We aim to be the
single source of communications services for our customers.

Competitively priced services. We offer local voice services that are
typically priced lower than comparable voice services provided by
incumbent local telephone companies. We also offer long distance and high
speed Internet access at competitive rates and provide additional
discounts to customers who purchase bundled services.

Dedicated building communications managers. Our building communications
managers act as the customer's single point of contact to our company and
manage each of our served buildings. These managers work with existing and
prospective customers to tailor service offerings to meet a customer's
current and evolving communications needs.

Rapid and easy provisioning. Once we have installed our in-building
broadband network, we are typically able to provision services to new
customers on an average of five business days.

Responsive customer service. We maintain a network operations center which
permits us to identify and resolve network problems efficiently. We also
maintain a toll-free customer service hotline and employ field support
technicians who are on call 24 hours a day, 365 days a year.

Our principal executive office is located at 1372 Broadway, New York, New
York 10018, and our telephone number is (212) 324-1500. We maintain a site on
the World Wide Web at http://www.onsiteaccess.com; HOWEVER, THE INFORMATION
FOUND ON OUR WEBSITE IS NOT A PART OF THIS PROSPECTUS.

<PAGE>

THE OFFERING

<TABLE>
<S> <C>
Common stock offered by OnSite Access................ shares.
Common stock to be outstanding after this offering... shares or shares if the underwriters
exercise their over-allotment option in full.
These shares do not include 1,695,375 shares
reserved for issuance pursuant to options we
may issue in the future and 2,416,125 shares
subject to outstanding options, in each case
pursuant to our stock option plan. In
addition, these shares do not include
shares subject to outstanding warrants.
Use of proceeds...................................... We expect to use the net proceeds to fund the
continuing deployment of our network services
in our existing markets, as well as our
planned rollout into additional markets. We
also expect to use these proceeds for expenses
associated with the continued development of
our sales, marketing and infrastructure
activities and for general corporate purposes.
Proposed Nasdaq National Market symbol............... 'OSAX'
</TABLE>

<PAGE>

SUMMARY FINANCIAL INFORMATION

The following table presents our summary condensed consolidated financial
information and has been derived from our audited financial statements for the
period from July 5, 1996 (date of inception) through December 31, 1996, and for
the years ended December 31, 1997 and 1998 and from our unaudited financial
statements for the nine months ended September 30, 1998 and 1999, all of which
are included in another section of this prospectus. The results of operations
for interim periods are not necessarily indicative of full year results. As
adjusted balance sheet data gives effect to (1) the sale of shares of
common stock in this offering and (2) the conversion of our outstanding
preferred stock into common stock. The information set forth below should be
read in conjunction with 'Selected Financial Data,' 'Management's Discussion and
Analysis of Financial Condition and Results of Operations' and our consolidated
financial statements and the notes to our consolidated financial statements,
each of which is included in this prospectus.

EBITDA consists of net loss excluding non-cash equity consideration, net
interest, taxes, depreciation and amortization. We have provided EBITDA because
it is a measure of financial performance commonly used in the communications
industry, but other companies may calculate it differently from us. We have
presented EBITDA to enhance your understanding of our operating results. You
should not construe it as an alternative to operating income as an indicator of
our operating performance or as an alternative to cash flows from operating
activities as a measure of liquidity.

<TABLE>
<CAPTION>
PERIOD FROM
INCEPTION YEAR ENDED NINE MONTHS ENDED
(JULY 5, 1996) DECEMBER 31, SEPTEMBER 30,
TO DECEMBER 31, ------------------------ ------------------------
1996 1997 1998 1998 1999
------------------ --------- --------- --------- ----------
(IN THOUSANDS, EXCEPT SHARE AND PER SHARE DATA AND OTHER OPERATING DATA)
<S> <C> <C> <C> <C> <C>
STATEMENT OF OPERATIONS DATA:
Network service revenue.......................... $ -- $ 19 $ 871 $ 517 $ 2,317
Consulting revenue............................... 20 329 73 73 --
------ ------- ------- ------- --------
Total revenue.......................... 20 348 944 590 2,317
Operating expenses:
Direct costs of revenues.................... -- 140 634 374 1,762
Selling, general and administrative......... 77 1,177 3,975 2,631 10,971
Non-cash equity consideration............... -- 64 503 503 4,684
Depreciation and amortization............... 1 23 366 235 1,245
------ ------- ------- ------- --------
Total operating expenses............... 78 1,404 5,478 3,743 18,662
------ ------- ------- ------- --------
Operating loss................................... (58) (1,056) (4,534) (3,153) (16,345)
Other income (expense), net...................... (3) (64) (394) (221) (992)
------ ------- ------- ------- --------
Net loss......................................... (61) (1,120) (4,928) (3,374) (17,337)
Accreted dividends on preferred stock............ -- -- -- -- (834)
------ ------- ------- ------- --------
Net loss applicable to common stockholders....... $ (61) $(1,120) $(4,928) $(3,374) $(18,171)
------ ------- ------- ------- --------
------ ------- ------- ------- --------
Net loss per common share........................ $(0.02) $ (0.33) $ (1.19) $ (1.09) $ (4.06)
------ ------- ------- ------- --------
------ ------- ------- ------- --------
Weighted average number of shares outstanding.... 3,339,500 3,439,714 4,156,836 3,105,081 4,479,112
--------- --------- --------- --------- ---------
--------- --------- --------- --------- ---------
OTHER FINANCIAL DATA:
EBITDA........................................... $ (57) $ (969) $(3,665) $(2,415) $(10,416)

OTHER OPERATING DATA (AT THE END OF THE PERIOD):
Buildings in service............................. -- 2 24 14 80
Rentable square feet of buildings in service..... -- 309,900 4,508,221 2,782,436 19,865,753
</TABLE>

<TABLE>
<CAPTION>
SEPTEMBER 30, 1999
--------------------------
ACTUAL AS ADJUSTED
-------- -----------
(IN THOUSANDS)
<S> <C> <C>
BALANCE SHEET DATA:
Cash.................................................................................... $ 18,575 $
Property and equipment, net............................................................. 14,852
Total assets............................................................................ 37,222
Total liabilities....................................................................... 7,824
Redeemable preferred stock.............................................................. 40,239
Total stockholders' (deficit) equity.................................................... (10,841)
</TABLE>

<PAGE>

RISK FACTORS

This offering involves a high degree of risk. You should carefully consider
the risks described below and the other information in this prospectus,
including our consolidated financial statements and the related notes, before
you purchase any shares of our common stock.

RISKS RELATED TO OUR BUSINESS

OUR SHORT OPERATING HISTORY MAKES IT DIFFICULT TO PREDICT OUR SUCCESS

Our business was founded in July 1996, and we have a short operating
history for you to review in evaluating our business. We have limited historical
financial and operating data upon which you can evaluate our business and
prospects. We entered into our first access agreement in June 1997 and began to
provide commercial services in September 1997. We have limited commercial
operations and have recognized limited revenues since our inception. In
addition, our executive management team and other employees have worked together
at our company for only a short period of time. You should evaluate our chances
of financial and operational success in light of these factors as well as the
risks, uncertainties, expenses, delays and difficulties associated with starting
a new business.

WE EXPECT OUR NEGATIVE EBITDA, NET LOSSES AND NEGATIVE CASH FLOW TO CONTINUE AND
TO INCREASE

To date, we have incurred increasing negative EBITDA (earnings before
non-cash equity consideration, interest, taxes, depreciation and amortization),
substantial losses and negative cash flow on both an annual and quarterly basis.
In 1998, we had negative EBITDA of approximately $3.7 million, net losses of
approximately $4.9 million, and negative cash flow from combined operating and
investing activities of approximately $4.6 million. For the nine-month period
ended September 30, 1999, we had negative EBITDA of approximately $10.4 million,
net losses of approximately $17.3 million and negative cash flow from combined
operating and investing activities of approximately $21.8 million. We expect our
negative EBITDA, net losses and negative cash flow to continue and to increase.

Moreover, we expect to continue to incur significant development costs and,
as a result, we will need to generate significant revenue to achieve
profitability, which may not occur. If our revenue does not grow as expected or
as needed to offset our increases in development costs, it is likely our
business will not succeed.

OUR BUSINESS MODEL IS UNPROVEN AND MAY NOT SUCCEED

We have not validated our business model and strategy in the market. We
believe that the combination of our unproven business model and the highly
competitive and fast-changing communications market in which we compete makes it
impossible to predict (1) the extent to which our communications services will
achieve market acceptance, (2) favorable customer penetration in the buildings
where we provide service or (3) our overall success. To be successful, we must
develop, market and implement communications solutions that are widely accepted
by small and medium-sized businesses at prices that cover both our operating
expenses and our significant development costs. We may never be able to deploy
our communications solutions as planned, achieve significant market acceptance,
favorable operating results or profitability or generate revenues sufficient to
cover our capital and operating costs.

THERE MIGHT NOT BE SUFFICIENT DEMAND FOR OUR DATA AND ENHANCED SERVICES AMONG
SMALL AND MEDIUM-SIZED BUSINESSES

Demand for data services has grown rapidly, and this market is
characterized by rapidly changing technology, evolving industry standards and
frequent new service introductions. If the commercial market for Internet access
and other broadband data services develops more slowly than expected or if the
communications services that we offer are not widely accepted among small and
medium-sized businesses, our revenues will not grow as quickly as necessary to
achieve

<PAGE>

or sustain profitability. Demand and market acceptance for recently introduced
services in this industry, including our enhanced services, are also subject to
a high level of uncertainty. Heavy use of the Internet may impede further
development to the extent that users experience delays, transmission errors and
other difficulties. In addition, customers who have already invested substantial
resources in other technologies may be particularly reluctant or slow to employ
our services.

THE COMMUNICATIONS INDUSTRY IS HIGHLY COMPETITIVE, AND WE MAY NOT BE ABLE TO
COMPETE EFFECTIVELY

We face significant competition from traditional and new communications
companies, including in-building competitors, local and long distance telephone
companies and Internet, digital subscriber line and cable modem service
providers. Many of our competitors have longer operating histories and customer
relationships, greater financial, technical, and marketing resources, larger
customer bases and greater brand or name recognition than we have. Furthermore,
the numerous companies that may seek to enter our niche may expose us to severe
price competition for our services and for building access rights. Our
competitors may also be able to respond more quickly to technological
developments and changes in customers' needs. Any of these factors may cause us
not to compete effectively and could harm our business, results of operations
and ability to grow.

In-building competitors. In-building competitors, such as Allied Riser
Communications, Broadband Office, Cypress Communications, Intermedia
Communications, NEXTLINK Communications, RCN Telecom Services, SiteLine,
Teligent and WinStar are attempting to gain access to office buildings in our
target markets. To the extent these competitors successfully develop
relationships with real estate owners in our target markets, we may face
difficulties in building our networks and marketing our services within our
target buildings. In addition, some competitors have rights to install networks
and offer competitive services in some of the buildings in which we have access
rights.

Local telephone companies. Incumbent local telephone companies, including
the regional bell operating companies, and competitive local telephone companies
have several competitive strengths which may place us at a competitive
disadvantage. These competitive strengths include:

an established brand name and reputation;

significant capital to deploy fiber-optic equipment rapidly;

competitive price and service offerings; and

their own existing in-building and inter-building connections.

Long distance telephone companies. Many of the leading long distance
telephone carriers, including AT&T, MCI WorldCom and Sprint, are expanding their
capabilities to support high speed, end-to-end data networking services, and
could begin to develop their own in-building broadband networks. The newer
national long distance telephone carriers, such as BroadWing, Level 3, Qwest and
Williams Communications, are also building and managing nationwide high speed
fiber-optic data networks and partnering with Internet service providers. In
addition, these carriers may extend their networks by installing in-building
fiber optic cables.

Internet, digital subscriber line, and cable modem service providers.
Customers can use the services provided by Internet, digital subscriber line,
and cable modem service providers instead of our services. Internet service
providers, such as Concentric Networks, EarthLink, GTE Internetworking,
MindSpring, Prodigy, PSINet, Sprint, UUNET, a subsidiary of MCI WorldCom, and
Verio, provide Internet access to residential and business customers, generally
using the existing communications infrastructure. Digital subscriber line
companies, such as Covad, Network Access Solutions, NorthPoint and Rhythms
NetConnections, and/or their Internet service provider customers, typically
provide high speed Internet access. Cable modem service providers, such as
Excite@Home and its @Work subsidiary, High Speed Access, RCN Telecom Services
and Road Runner, also provide high speed Internet access. On-line service
providers, such as America Online, Compuserve, Microsoft Network, and WebTV,
provide Internet connectivity, ease-of-use and a stable environment for modem
connections.

<PAGE>

WE MUST OBTAIN ADDITIONAL ACCESS AGREEMENTS WITH REAL ESTATE OWNERS, INSTALL OUR
IN-BUILDING BROADBAND NETWORKS AND OBTAIN CUSTOMERS BEFORE OUR IN-BUILDING
COMPETITORS DO SO OR WE WILL FACE A COMPETITIVE DISADVANTAGE

Our success depends on our ability to obtain access agreements with real
estate owners, install our in-building broadband networks and obtain customers
before our in-building competitors do so. The first communications provider in a
building has the first opportunity to obtain customers. Once customers subscribe
for services from a communications provider, it becomes more difficult for
competitors to attract those customers. We may not be able to accomplish this
'first-mover' objective due to a number of factors, including:

real estate owners may decide not to permit us to install our networks in
their buildings or they may not offer terms that are as favorable as the
terms they offer our competitors;

our access agreements typically do not preclude our competitors from
gaining access to such buildings; and

each building in which we have obtained access rights but have not yet
built a network is also vulnerable to other in-building competitors.

Because of the foregoing, we could face a significant competitive
disadvantage and our business and results of operations would suffer. In
addition, if real estate owners elect not to renew our access agreements or not
to make favorable terms available on renewal, we could face a significant
competitive disadvantage and our business and results of operations would
suffer.

OUR BUSINESS WILL BE HARMED IF OUR INFORMATION PROCESSING SYSTEMS ARE NOT
REPLACED OR FURTHER DEVELOPED

Sophisticated information processing systems are vital to our growth and
our ability to achieve operating efficiencies. A failure of any of these systems
could substantially impair our ability to provide services, send invoices and
monitor our operations. Systems we have identified as being presently inadequate
to meet the increased demands of our anticipated growth include our (1) billing
and collections systems, (2) operational support systems, such as order entry,
order management, customer service databases and trouble ticketing, and
(3) administrative systems, such as financial, accounting and human resources.

We estimate that modifying or replacing these systems will cost
approximately $34 million over the next two years, although actual costs may be
higher. Our plans for the development and implementation of these systems rely,
for the most part, on acquiring products and services offered by third-party
vendors and integrating those products and services. We may be unable to
implement these systems on a timely basis or at all, and these systems may not
perform as expected. We may also be unable to maintain and upgrade these systems
as necessary.

We are also dependent on the systems of our voice and data providers, and,
in some cases, on the interface between our systems and those of our providers.
Therefore, any systems failures experienced by our providers could also have
similar adverse effects on our systems.

WE DEPEND HEAVILY ON A LIMITED NUMBER OF CUSTOMERS; A SIGNIFICANT REDUCTION IN
THE SERVICES PROVIDED TO THESE CUSTOMERS WOULD HARM OUR FINANCIAL CONDITION AND
RESULTS OF OPERATIONS

We derive a large portion of our revenue from a limited number of
customers. In 1998, our five largest customers accounted for approximately 41%
of our revenue, with Reckson Associates Realty Corp., an affiliate of Reckson
Service Industries, Inc., accounting for approximately 14% of our revenue and
C3I, Inc. accounting for approximately 13% of our revenue. For the nine months
ended September 30, 1999, our five largest customers accounted for approximately
25% of our revenue, with Reckson Associates accounting for approximately 6% of
our revenue and VANTAS, Incorporated, another affiliate of Reckson Service
Industries, accounting for approximately 12% of our revenue. The services
provided to these customers may not be sustained from year to year, and there is
a risk that these customers may not retain us in the future. Any cancellation,
deferral or significant reduction in services provided to these customers or a
significant number of smaller

<PAGE>

customers would have a material adverse effect on our financial condition and
results of operations.

WE DEPEND HEAVILY ON A LIMITED NUMBER OF REAL ESTATE OWNERS; A DETERIORATION IN
OUR RELATIONSHIP WITH THESE REAL ESTATE OWNERS WOULD HARM OUR FINANCIAL
CONDITION AND RESULTS OF OPERATIONS

We derive a large portion of our revenue from customers located within the
buildings of a limited number of real estate owners. In 1998, customers located
within the buildings of our three largest real estate owners accounted for
approximately 85% of our revenue, with customers located within buildings owned
by affiliates of Reckson Associates accounting for approximately 35% of our
revenue, customers located within J. General Real Estate's buildings accounting
for approximately 25% of our revenue and customers located within Penn Capital
Realty Inc.'s buildings accounting for approximately 24% of our revenue. For the
nine months ended September 30, 1999, customers located within the buildings of
our five largest real estate owners accounted for approximately 66% of our
revenue, with customers located within buildings owned by affiliates of Reckson
Associates accounting for approximately 22% of our revenue, customers located
within Taconic Investment Partners, LLC's buildings accounting for approximately
13% of our revenue, customers located within Penn Capital Realty's buildings
accounting for approximately 11% of our revenue and customers located within
Cogswell Realty Group, LLC's buildings accounting for approximately 11% of our
revenue. Our relationships with these real estate owners may not be sustained
from year to year, and there is a risk that these real estate owners may not
retain us upon the termination of an access agreement with one of their
buildings or consider us for their other buildings for which we currently do not
provide service. Real estate owners may permit competitors to offer services
within their buildings or terminate or fail to renew our access agreements, any
of which would have a material adverse effect on our financial condition and
results of operations. In addition, any deterioration in our relationship with
these real estate owners or a significant number of smaller real estate owners
would have a material adverse effect on our financial condition and results of
operations.

In addition, our typical license or access agreement has an initial term of
approximately five to ten years, with renewal options ranging from five to
fifteen years. Many of these agreements contain minimum performance criteria. If
these agreements are terminated for failure to meet these performance criteria
or are not otherwise renewed, then we may not have access to customers which
could have a material adverse effect on our financial condition and results of
operations.

THE COMMUNICATIONS INDUSTRY IS UNDERGOING RAPID TECHNOLOGICAL CHANGES, AND NEW
TECHNOLOGIES MAY BE SUPERIOR TO THE TECHNOLOGY WE USE

The communications industry is subject to rapid and significant
technological change, such as continuing developments in digital subscriber line
technology and alternative technologies for providing high speed data
communications, including cable modem, fixed wireless, satellite or other high
speed transmission technology. As a consequence:

we expect that new products and technologies will emerge that may be
superior and/or render obsolete the products and technologies we currently
use, including copper-based transmission technologies;

our success will depend on our ability to anticipate or adapt to new
technology on a timely basis; and

we will rely on third parties, including some of our competitors and
potential competitors, to develop and provide us with access to
communications and networking technology.

If we fail to adapt successfully to technological changes or fail to obtain
access to new or improved technologies, our business would suffer.

<PAGE>

WE MUST MAKE SIGNIFICANT CAPITAL EXPENDITURES BEFORE GENERATING REVENUE, WHICH
MAY PROVE INSUFFICIENT TO JUSTIFY THOSE EXPENDITURES

We will have to make significant capital expenditures to develop our
business and deploy our networks, services and systems. The amount and timing of
these expenditures are uncertain and will depend upon our ability to execute our
plans in a timely and cost-effective manner. If our revenue does not grow as
expected, or capital expenditures exceed our estimates, our business and
financial condition would suffer.

In particular, when we install our in-building broadband networks, we incur
significant initial expenditures. These expenditures vary depending on the size
of the building and whether we encounter any construction-related difficulties.
We typically install a network before we have any customers in that building.
Since we generally do not solicit customers within a building until our network
is in place, and since our costs can vary, we do not know whether we will be
able to recoup our expenditures within any building. If we fail to attract
enough customers, or any customers at all, within a particular office building,
we would not be able to recoup our expenditures within that building. In
addition, some of our agreements with real estate owners require us to remove
our equipment when our access agreements terminate or are not renewed.
Accordingly, we may incur significant costs in connection with this equipment
removal which could harm our financial condition and results of operations.

We would also need to install costly fiber-optic equipment to work with our
existing fiber-optic cabling if an immediate increase in demand for capacity
exceeds our current in-building broadband network capacity. We would also incur
significant additional expenses and experience losses if there were an immediate
increase in customer demand for fiber-optic capacity without a corresponding
increase in the prices our customers are willing to pay.

WE RELY ON THIRD PARTIES FOR VOICE AND DATA CONNECTIVITY AND COLLOCATION SPACE

We primarily rely on Cablevision LightPath and Focal Communications
Corporation to provide local voice services and MCI Worldcom to provide long
distance services to our customers. Technical difficulties arising from
Cablevision LightPath, Focal Communications or MCI WorldCom's voice networks, or
contractual or other problems with our business relationships with these voice
services providers, could have a material adverse effect on our business and
results of operations.

We primarily rely on Level 3 Communications to provide collocation space
for our data network access points. Contractual or other problems with our
business relationship with Level 3 could have a material adverse effect on our
business and results of operations.

We also rely on other communications providers for data connectivity. Our
failure to obtain adequate connections from other communications providers on a
timely basis could delay or impede our ability to provide services and generate
revenue. In addition, in some of our target markets, there is only one
established carrier available to provide the necessary connection. This
increases our costs and makes it extremely difficult, if not impossible, to
obtain redundant connections. Sufficient capacity or redundant capacity may not
be readily available from third parties at commercially reasonable rates, if at
all. Our failure to obtain sufficient redundant connectivity could result in
service interruptions or an inability to provide service in selected buildings
which could, in time, lead to a loss of customers and damage to our reputation.

We have committed to pay for approximately $12 million of services from our
voice and data providers through 2003. We will have to pay those carriers even
if we do not use their services.

OUR BUSINESS COULD SUFFER FROM A REDUCTION OR INTERRUPTION FROM OUR EQUIPMENT
SUPPLIERS OR OTHER THIRD PARTIES ON WHOM WE RELY FOR INSTALLATION AND PROVISION
OF FIELD SERVICE

We purchase our equipment from various vendors and outsource a significant
portion of the installation and field service of our networks to third parties.
Any reduction in or interruption of deliveries from our major equipment
suppliers, such as Copper Mountain, Lucent Technologies or Cisco Systems, or
interruption in service from any significant installer or field service provider
of our in-building broadband network, such as a local cabling company, could
delay our network

<PAGE>

buildout, impair our ability to acquire or retain customers and harm our
business generally. In addition, the price of the equipment we purchase may
substantially increase over time, increasing the costs we pay in the future. It
could take a significant period of time to establish relationships with
alternative suppliers for each of our technologies and substitute their
technologies into our network.

A SYSTEM FAILURE OR BREACH OF NETWORK SECURITY COULD DELAY OR INTERRUPT SERVICE
TO OUR CUSTOMERS

A natural disaster or other unanticipated interruption of service or damage
at any of our network facilities would impair the reliability of our
transmission services in our markets. Additionally, failure by any network
service provider to provide communications capacity required by us, as a result
of a natural disaster, operational disruption or for any other reason, could
cause interruptions in the delivery of our services. Damage or failure that
causes interruptions in the delivery of our services could impair our ability to
acquire or retain customers as well as harm our reputation and business.

Our network may be vulnerable to unauthorized access, computer viruses and
other disruptive problems. Unauthorized access could also potentially jeopardize
the security of confidential information stored in the computer systems of our
customers, which might result in liability to our customers, and also might
deter potential customers. Although we have implemented and plan to continue
adding security measures that are standard within the telecommunications
industry, we may be unable to implement such measures in a timely manner or, if
and when implemented, our security measures may be circumvented. Eliminating
computer viruses and alleviating other security problems may require
interruptions, delays or cessation of service to our customers and these
customers' end users. Any of the foregoing factors relating to network security
could have a material adverse effect on our business.

WE MAY BE UNABLE TO DELIVER OUR SERVICES IF OUR IN-BUILDING BROADBAND NETWORK OR
A DATA NETWORK ACCESS POINT ENCOUNTERS TECHNICAL DIFFICULTIES

Our in-building broadband network is the primary channel through which we
deliver our communications services to our customers. Our customers are derived
from the tenant base of a commercial office building, and each building in which
we have constructed our in-building broadband network is a site for potential
concentration of our customers. Since our customers within a commercial office
building are served by the same in-building broadband network, any network
problems affecting our in-building broadband network may affect the delivery of
services to all of our customers in that building. Any technical difficulties
within a particular in-building broadband network may prevent our customers in
that building from receiving services. In addition, traffic from our in-building
broadband networks is aggregated through a data network access point. Any
technical difficulties at a data network access point may prevent a group of in-
building broadband networks from receiving service. If we are unable to deliver
services as a result of any of these technical difficulties, our business may
suffer through the loss of revenues and customers.

OUR OPERATING RESULTS IN ONE OR MORE FUTURE PERIODS ARE LIKELY TO FLUCTUATE
SIGNIFICANTLY AND MAY FAIL TO MEET OR EXCEED THE EXPECTATIONS OF SECURITIES
ANALYSTS OR INVESTORS

Our quarterly operating results are likely to fluctuate significantly in
the future due to numerous factors, many of which are outside of our control.
These factors include:

the rate at which we can attract and retain customers and the rate of
tenant turnover in buildings in which we have installed our networks;

the prices our customers are willing to pay for the services we provide
and the intensity of price competition we face from competitors;

our expenditures related to the nationwide expansion of our networks and
the development of our services;

<PAGE>

the introduction of new services or technologies by our competitors that
are incompatible with or superior to the products and services we provide;

regulatory developments, including interpretations of the 1996
Telecommunications Act, which could intensify competition in the
telecommunications industry; and

technical difficulties or network downtime which could interfere with the
delivery of our services.

Because of these factors, our operating results in one or more future
periods could fail to meet the expectations of securities analysts or investors.
In that event, the trading price of our common stock would likely decline.

OUR FAILURE TO MANAGE OUR GROWTH EFFECTIVELY COULD IMPAIR OUR BUSINESS

If we are successful in implementing our business plan, our operations will
expand rapidly. This rapid expansion could place a significant strain on our
management, financial and other resources. Our network infrastructure may need
future expansions and adaptations to respond to growth in the number of
customers served, increased capacity demands and changes to our service
offerings.

Our ability to manage future growth, if it occurs, will depend on our
ability to:

control expenses related to our business plan;

maintain responsive customer service;

maintain regulatory compliance with federal and state authorities as we
enter into new metropolitan areas;

improve existing, and implement new, billing and collections, operational
support and administrative systems; and

expand, train and manage our employee base.

The failure to manage our growth effectively would impair our business and
operational performance. We also cannot be sure that we will be able to expand
or adapt our networks to meet the increasing demands of customers or evolving
industry standards.

WE WILL NEED SIGNIFICANT ADDITIONAL FUNDS, WHICH WE MAY NOT BE ABLE TO OBTAIN

We believe our current capital resources, including our credit facilities,
together with the proceeds of this offering, will be sufficient for our funding
and working capital requirements and for the deployment and operation of our
networks in targeted markets through approximately the second quarter of 2001.
We will need significant additional funds beyond then to complete our nationwide
build out. We expect that the actual amount and timing of our future capital
requirements will depend on the demand for our services and on regulatory,
technological and competitive developments, including additional market
developments and new opportunities, in our industry. We may seek additional
financing earlier than 2001 if:

we accelerate the schedule or expand the scope of our network rollout
plan;

our plans or projections change or prove to be inaccurate;

we acquire other companies or businesses; or

market conditions allow us to raise public or privately financed capital
on attractive terms.

We may be unsuccessful in raising sufficient capital at all or on terms
that we consider acceptable. If we are unable to obtain adequate funds on
acceptable terms, our ability to deploy and operate our networks, fund our
expansion or respond to competitive pressures would be significantly impaired.
These limitations could hinder our ability to become profitable.

<PAGE>

IF WE BORROW FUNDS IN THE FUTURE, IT COULD LIMIT OUR FLEXIBILITY

If we decide to borrow funds in the future to fund our business, the terms
of those borrowings would likely contain restrictive covenants that would limit
our ability to incur additional indebtedness, pay dividends or undertake certain
other transactions. These instruments could also require us to pledge assets as
security for the borrowings. If we were to leverage our business by incurring
significant debt, we may be required to devote a substantial portion of our cash
flow to service that indebtedness. This could require us to modify our business
plan, for example, by delaying the capital expenditures necessary to complete
our network.

WE MUST ATTRACT AND RETAIN KEY PERSONNEL IN A TIGHT LABOR MARKET OR WE WILL BE
UNABLE TO MANAGE OUR GROWTH

Competition for personnel with the qualifications we require is intense.
The loss of the services of key personnel or the failure to attract additional
personnel as required could have a material adverse effect on our ability to
grow and on the price of our common stock. We are also highly dependent upon the
efforts of our existing senior management team. Although we have entered into
employment arrangements with members of our executive management team, these
arrangements do not obligate the employees to remain with us for any length of
time. In addition, we have not purchased any 'key person' life insurance for any
of our executive officers. We also believe that our future success will depend
in large part on our ability to attract and retain qualified technical and sales
personnel.

OUR INTELLECTUAL PROPERTY PROTECTION MAY BE INADEQUATE TO PROTECT OUR
PROPRIETARY RIGHTS, AND WE MAY BE SUBJECT TO INFRINGEMENT CLAIMS

We rely on a combination of confidentiality agreements and other contracts
to establish and protect our technology and other intellectual property rights.
We have applied for federal registration of certain of our trademarks and
servicemarks that we believe are important for market identification or the
branding of our business. We have not yet obtained any such registrations, and
we cannot give any assurances that registrations will be issued for those
trademarks and servicemarks. We currently have no patents or patent applications
pending. The steps we have taken may be inadequate to protect our technology,
processes or other intellectual property. Moreover, as is the case in many
industries, our competitors may independently develop technologies or processes
that are substantially equivalent or superior to ours. Third parties may assert
infringement claims against us and, in the event of an unfavorable ruling on any
claim, we may be unable to obtain a license or similar agreement to use
technology, processes and intellectual property we rely upon to conduct our
business. We also rely on unpatented trade secrets and know-how to maintain our
competitive positions, which we seek to protect, in part, by confidentiality
agreements. However, these agreements may be breached or terminated, and we may
not have adequate remedies for any breach. In addition, our competitors may
otherwise learn or discover our trade secrets. Our management personnel were
previously employees of other communications companies. In many cases, these
individuals are conducting activities for us in areas similar to those in which
they were involved prior to joining us. As a result, we or our employees could
be subject to allegations of violation of trade secrets, breaches of
confidentiality and other similar claims.

OUR FAILURE AND THE FAILURE OF THIRD PARTIES TO BE YEAR 2000 COMPLIANT COULD
NEGATIVELY IMPACT OUR BUSINESS

Potential problems created by the Year 2000 could adversely affect our
business in a number of significant ways. We are evaluating our internal
information technology systems and contacting our information technology and
other third party suppliers to ascertain their Year 2000 status. However, we do
not know whether our own systems will be Year 2000 compliant by the year 2000 or
whether our third party suppliers' systems will be Year 2000 compliant by that
time and there may be significant operational problems caused by any failures of
these information technology

<PAGE>

systems. In addition, customers may spend less on our service in the second half
of 1999 as customers invest in Year 2000 readiness and systems rather than
purchase new or additional products from us. As a result, Year 2000 issues could
have a material adverse effect on virtually every aspect of our operations.

AS AN INTERNET ACCESS PROVIDER, WE MAY INCUR LIABILITY FOR INFORMATION
DISSEMINATED THROUGH OUR NETWORK

The law relating to the liability of Internet access providers and on-line
services companies for information carried on or disseminated through their
networks is unsettled. As the law in this area develops, the potential
imposition of liability upon us for information carried on and disseminated
through our network could require us to implement measures to reduce our
exposure to such liability, which may require the expenditure of substantial
resources or the discontinuation of certain products or service offerings. Any
costs that are incurred as a result of such measures or the imposition of
liability could harm our business.

OUR COMMUNICATIONS SERVICES ARE SUBJECT TO EXTENSIVE GOVERNMENT REGULATION THAT
COULD CHANGE IN AN ADVERSE MANNER

Communications services are subject to significant regulation at the
federal, state, local and international levels. These regulations affect us, our
existing and potential competitors, and our suppliers. Delays in receiving
required regulatory approvals or the enactment of new and adverse regulations or
regulatory requirements may have a material adverse effect on us. Also,
regulatory decisions affecting the telecommunications industry could affect our
operating results by increasing competition, decreasing revenue, increasing
costs or impairing our ability to offer certain services. Interconnection
agreements are also subject to state commission, FCC and judicial oversight.
These government bodies may modify the terms or prices of our interconnection
agreements in ways that adversely affect our business and expose us to increased
competition. For example, on December 9, 1999, the FCC ordered incumbent local
telephone companies to offer 'line sharing' arrangements that will permit
competing carriers to offer digital subscriber line services over the same
copper loop facilities used by the incumbent local telephone company to provide
voice telephone service. The prices for these arrangements will be determined by
state utility commissions. If these prices are set at low levels, it could allow
our competitors to offer low-cost alternatives to our services and put downward
pressure on our prices for Internet access and other data services.

REGULATORY AND LEGISLATIVE DEVELOPMENTS REGARDING ACCESS BY COMMUNICATIONS
SERVICE PROVIDERS TO OFFICE BUILDINGS COULD IMPAIR OUR BUSINESS

There is no current national legal requirement that owners or managers of
commercial office buildings give competitive providers of communications
services access to buildings to install communications equipment. Several states
have adopted such regulations, and others may be adopted elsewhere in the
future. Recently, the FCC announced that it is considering a rule to require
non-discriminatory riser access in multiple tenant buildings. Several bills have
been introduced in the current Congress that would impose similar obligations on
real estate owners although, to date, none of these bills have been passed. Some
of the issues being considered by the FCC and Congress include requiring real
estate owners to provide riser access to communications carriers on a
non-discriminatory basis and requiring some communications providers to provide
access to their risers to other communications providers. We cannot predict
whether or in what form these proposals will be adopted. If they are adopted and
regulatory or legal requirements change access rights to our target buildings or
our networks, these requirements could harm our business and expose us to
increased competition.

<PAGE>

POTENTIAL REGULATION OF INTERNET SERVICE PROVIDERS COULD ADVERSELY AFFECT OUR
OPERATIONS

To date, Internet service providers have been subject to very little
regulation by the federal and state governments. The FCC has exempted Internet
service providers from regulations governing communications carriers, including
the obligation to pay access charges and contribute to the Universal Service
Fund. The FCC is currently examining the status of Internet service providers
and the services they provide. If the FCC were to determine that Internet
service providers are required to pay contributions to the Universal Service
Fund in the same manner as communications carriers, it could have a material
adverse effect on us and all other Internet service providers. Also, various
levels of government are considering new laws concerning Internet user privacy,
infringement, pricing, quality of products and services, intellectual property
ownership, and taxation of Internet businesses. In some cases, courts have been
asked to apply existing laws in areas such as property ownership, copyright,
trademark, trade secret, obscenity and defamation to the Internet in new ways.
The adoption of new laws, or court decisions concerning the application of
existing laws to the Internet, may decrease the growth in the use of the
Internet or change the economics of providing Internet service to our customers,
which could have a material adverse effect on our business.

UNCERTAIN FEDERAL AND STATE TAX AND OTHER SURCHARGES ON OUR SERVICES MAY
INCREASE OUR PAYMENT OBLIGATIONS

Communications providers are subject to a variety of complex Federal and
state surcharges and fees on their gross revenues from interstate and intrastate
services, including regulatory fees, and surcharges related to the support of
the Universal Service Fund. A finding that we misjudged the applicability of the
surcharges and fees could increase our payment obligations and have a material
adverse effect on our business, financial condition or results of operations.

RISKS RELATED TO THIS OFFERING

THE SALE OR AVAILABILITY FOR SALE OF SUBSTANTIAL AMOUNTS OF OUR COMMON STOCK
COULD ADVERSELY AFFECT OUR STOCK PRICE

Sales of substantial amounts of our common stock (including shares issuable
upon the exercise of stock options or warrants) in the public market after the
completion of this offering, or the perception that these sales could occur,
could adversely affect the market price of our common stock and could materially
impair our ability to raise capital through offerings of our common stock in the
future. There will be shares of common stock outstanding immediately after
this offering, or shares if the underwriters exercise their over-allotment
option in full. The shares sold in this offering will be freely tradeable
without restriction or further registration under the Securities Act, unless
held by our 'affiliates' as that term is defined in Rule 144 under the
Securities Act. The shares of common stock outstanding prior to this
offering are 'restricted securities' as defined in Rule 144 and may not be sold
in absence of registration other than in accordance with Rule 144 or Rule 701
under the Securities Act or another exemption from registration.

In connection with this offering, we, our executive officers and directors
and some of our stockholders have agreed that, subject to specified exceptions,
for a period of 180 days after the date of this prospectus, we and they will
not, without the prior written consent of Salomon Smith Barney Inc., dispose of
or hedge any shares of our common stock or any securities convertible into or
exchangeable for our common stock. See 'Shares Eligible for Future Sale' for a
more detailed description of the restrictions on selling shares of our common
stock after this offering.

YOU WILL INCUR IMMEDIATE AND SUBSTANTIAL DILUTION

The initial public offering price is substantially higher than the net
tangible book value per share of the common stock. Therefore, you will incur
immediate dilution in net tangible book value of $ per share. You may
incur additional dilution if holders of stock options,

<PAGE>

whether currently outstanding or subsequently granted, exercise their options or
if warrantholders exercise their warrants to purchase common stock. See
'Dilution' on page 21 for more information.

OUR PRINCIPAL STOCKHOLDERS AND MANAGEMENT OWN A SIGNIFICANT PERCENTAGE OF OUR
COMPANY AND WILL BE ABLE TO EXERCISE SIGNIFICANT INFLUENCE

Our executive officers, directors and principal stockholders together will
beneficially own approximately % of our common stock after completion of this
offering. These stockholders, if they vote together, will be able to exercise
significant influence over all matters requiring stockholder approval, including
the election of directors and approval of significant corporate transactions.
This concentration of ownership may also delay or prevent a change in control of
us. See 'Principal Stockholders' on page 56 for information about the ownership
of common stock by our executive officers, directors and principal stockholders.

EXTERNAL FACTORS COULD ADVERSELY AFFECT THE MARKET PRICE OF OUR COMMON STOCK

There is currently no public market for our common stock, and we cannot
assure you that an active trading market will develop or be sustained after this
offering. The initial public offering price will be determined through
negotiation between us and representatives of the underwriters and may not be
indicative of the market price for the common stock after this offering.

The market price of our common stock could fluctuate significantly as a
result of:

economic and stock market conditions generally and specifically as they
may impact providers of communications services;

changes in financial estimates and recommendations by securities analysts
following our stock;

earnings and other announcements by, and changes in market evaluations of,
providers of communications services;

changes in business or regulatory conditions affecting providers of
communications services;

announcements or implementation by us or our competitors of technological
innovations or new communications services; and

trading volume of our common stock.

The securities of many companies have experienced extreme price and volume
fluctuations in recent years, often unrelated to the companies' operating
performance, and particularly in the communications sector. For example, market
prices for securities of technology companies, which may include voice,
Internet-related and data communications companies, have frequently reached
elevated levels, often following these companies' initial public offerings.
These levels may not be sustainable and may not bear any relationship to these
companies' operating performances. If the market price of our common stock
reaches an elevated level following this offering, it is likely to materially
decline. In the past, following periods of volatility in the market price of a
company's securities, a company's stockholders have often instituted securities
class action litigation against the company. If we were involved in such a class
action suit, it could have a material adverse effect on our business and
financial condition.

OUR MANAGEMENT HAS BROAD DISCRETION OVER THE USE OF PROCEEDS FROM THIS OFFERING

Our management has significant flexibility in applying the proceeds we
receive in this offering. Because the proceeds are not required to be allocated
to any specific investment or transaction, you cannot determine the value or
propriety of our management's use of the proceeds on our behalf. See 'Use of
Proceeds' on page 19 for a more detailed description of how management intends
to apply the proceeds of this offering.

<PAGE>

ANTI-TAKEOVER PROVISIONS OF DELAWARE'S GENERAL CORPORATION LAW AND OUR
CERTIFICATE OF INCORPORATION COULD DELAY OR DETER A CHANGE IN CONTROL

Amendments we intend to make to our amended and restated certificate of
incorporation and our bylaws, as well as various provisions of the Delaware
General Corporation Law, may make it more difficult to effect a change in
control of our company. The existence of these provisions may adversely affect
the price of our common stock, discourage third parties from making a bid for
our company or reduce any premiums paid to our stockholders for their common
stock. For example, we intend to amend our certificate of incorporation to
authorize our board of directors to issue up to shares of 'blank
check' preferred stock and to attach special rights and preferences to such
preferred stock. The issuance of this preferred stock may make it more difficult
for a third party to acquire control of us or cause the market price of our
common stock to decrease. We also intend to amend our certificate of
incorporation to provide for the division of the board of directors into three
classes as nearly equal in size as possible with staggered three-year terms.
This classification of the board of directors could have the effect of making it
more difficult for a third party to acquire our company, or of discouraging a
third party from acquiring control of our company. See 'Description of Capital
Stock -- Preferred Stock' and 'Description of Capital Stock -- Anti-takeover
Effects of Our Certificate of Incorporation and Bylaws and Provisions of
Delaware Law' for a more complete description of our capital stock, our
certificate of incorporation and the effects of the Delaware General Corporation
Law which could hinder a third party's attempts to acquire control of us.

<PAGE>

CAUTIONARY NOTICE REGARDING FORWARD-LOOKING STATEMENTS

This prospectus includes 'forward-looking statements' for purposes of the
Securities Act of 1933 and the Securities Exchange Act of 1934. All statements
other than statements of historical fact in this prospectus, including
statements regarding our competitive strengths, business strategy, future
financial position, budgets, projected costs and plans and objectives of
management are forward-looking statements. In addition, forward-looking
statements generally can be identified by the use of forward-looking terminology
such as 'may,' 'will,' 'expect,' 'should,' 'intend,' 'estimate,' 'anticipate,'
'believe,' 'continue' or similar terminology. We can give no assurance that the
expectations reflected in forward-looking statements will prove to have been
correct. Our actual results could differ materially from those anticipated in
these forward-looking statements as a result of factors including those set
forth under the 'Risk Factors,' 'Management's Discussion and Analysis of
Financial Condition and Results of Operations' and 'Business' sections, and
elsewhere in this prospectus. All written and oral forward-looking statements
attributable to us are expressly qualified in their entirety by the factors we
disclose that could cause our actual results to differ materially from our
expectations. We undertake no obligation to update publicly or revise any
forward-looking statements.

<PAGE>

USE OF PROCEEDS

We estimate that we will receive net proceeds of approximately $ million,
or approximately $ million if the underwriters' over-allotment option is
exercised in full, from the sale of the shares of common stock offered by us, at
an assumed initial public offering price of $ per share, after deducting the
estimated underwriting discounts and commissions and offering expenses payable
by us.

We expect to use the net proceeds of this offering for the following
purposes:

expenditures for the deployment of our network services in existing
markets, as well as our planned rollout into additional markets;

expenses associated with the continued development of our sales, marketing
and infrastructure activities; and

to fund operating losses.

Our management continually evaluates potential strategic acquisitions and
investments, but at the present time we have no understandings, commitments or
agreements with respect to any acquisition or investment. Pending such uses, we
intend to invest the net proceeds from this offering in U.S. government
securities and other investment-grade, interest-bearing instruments.

The foregoing represents our present intentions with respect to the
allocation of proceeds of this offering based upon our present plans and
business conditions. The occurrence of unforeseen events or changed business
conditions could result in the application of the proceeds of this offering in a
manner other than as described in the prospectus.

DIVIDEND POLICY

Our board of directors has never declared or paid any cash dividends on our
common stock and does not expect to do so in the foreseeable future. We
currently intend to retain any earnings to finance the expansion and development
of our business. Our board of directors will make any future determination of
the payment of dividends based on conditions then existing, including our
earnings, financial condition and capital requirements, as well as such economic
and other conditions as the board of directors may deem relevant. In addition,
the payment of dividends may be limited by financing agreements that we may
enter into in the future.

<PAGE>

CAPITALIZATION

The following table sets forth our capitalization (1) as of September 30,
1999 on an actual basis and (2) as adjusted for $19.5 million in equity
financing received in December 1999 pursuant to a preferred stock purchase
agreement with a group of private equity investors, the conversion of our
preferred stock into common stock, an amendment to our certificate of
incorporation to increase the number of our authorized shares of common stock to
million and preferred stock to million and the sale of million shares
of common stock offered by this prospectus.

The issued and outstanding common stock excludes, as of the completion of
this offering, (1) 1,695,375 shares reserved for issuance pursuant to options we
may issue in the future and 2,416,125 shares subject to outstanding options, in
each case pursuant to our stock option plan and (2) shares subject to
outstanding warrants.

This table should be read in conjunction with 'Selected Financial Data,'
'Management's Discussion and Analysis of Financial Condition and Results of
Operations' and our consolidated financial statements and the notes to our
consolidated financial statements, each of which is included in this prospectus.

<TABLE>
<CAPTION>
AS OF SEPTEMBER 30, 1999
--------------------------
ACTUAL AS ADJUSTED
---------- -------------
(IN THOUSANDS)
<S> <C> <C>
Cash and cash equivalents................................... $ 18,575 $
-------- ----------
-------- ----------
Capital lease obligations, net of current portion........... $ 2,487 $
Redeemable Series B, C and D preferred stock................ 40,239
Stockholders' equity (deficit):
Series A preferred stock, $0.001 par value: 5,869,000
shares authorized, issued and outstanding, actual; 0,
as adjusted........................................... 7,099
Common stock, $0.001 par value: 75,000,000 shares
authorized, 9,813,620 shares issued and outstanding,
actual; shares issued and outstanding, as adjusted.. 10
Additional paid-in capital.................................. 28,086
Stockholder loans........................................... (2,262)
Deferred equity consideration............................... (19,493)
Accumulated deficit......................................... (24,281)
-------- ----------
Total stockholders' equity (deficit).............. (10,841)
-------- ----------
Total capitalization........................................ $ 31,885 $
-------- ----------
-------- ----------
</TABLE>

<PAGE>

DILUTION

Our net tangible book value as of September 30, 1999, after giving effect
to the conversion of our outstanding preferred stock into common stock, was
approximately $ million, or $ per share. Net tangible book value per share
is equal to our total tangible assets minus total liabilities divided by the
number of shares of common stock outstanding. Assuming we had also sold the
shares of common stock offered hereby at an assumed initial public
offering price of $ , and after deducting underwriting discounts and
commissions and estimated offering expenses payable by us, our net tangible book
value at September 30, 1999 would have been approximately $ million, or
$ per share. This represents an immediate increase in net tangible book value
of $ per share to existing stockholders and an immediate dilution of $ per
share to new investors in this offering. Dilution is determined by subtracting
net tangible book value per share after the offering from the amount of cash
paid by a new investor for a share of common stock. The following table
illustrates the substantial and immediate per share dilution to new investors:

<TABLE>
<CAPTION>
PER SHARE
-----------------------
<S> <C> <C>
Assumed initial public offering price....................... $
Net tangible book value as of September 30, 1999.......
Increase attributable to new investors................. $
----------
Net tangible book value after giving effect to the
offering..................................................
----------
Dilution to new investors................................... $
----------
----------
</TABLE>

The following table sets forth as of September 30, 1999 the number of
shares of common stock purchased from us, the total consideration paid and the
average price per share paid by existing stockholders, after giving effect to
the conversion of our outstanding preferred stock into common stock, and by new
investors. The calculations with respect to shares purchased by new investors in
this offering reflect an assumed offering price of $ per share:

<TABLE>
<CAPTION>
SHARES PURCHASED TOTAL CONSIDERATION
-------------------- -------------------- AVERAGE PRICE
NUMBER PERCENT AMOUNT PERCENT PER SHARE
------ ------- ------ ------- -------------
<S> <C> <C> <C> <C> <C>
Existing stockholders................. % $ % $
New investors.........................
------- --- ------- ---
Total................................. % $ %
------- --- ------- ---
------- --- ------- ---
</TABLE>

If the underwriters exercise their over-allotment in full, the pro forma
net tangible book value per share of common stock as of September 30, 1999 would
have been $ per share, which would result in dilution to the new investors of
$ per share, and the number of shares held by the new investors will
increase to , or % of the total number of shares to be outstanding
after this offering.

The foregoing tables assume no exercise of any outstanding stock options or
warrants to purchase common stock. As of September 30, 1999, there were
outstanding options to purchase an aggregate of shares of common stock
at a weighted average exercise price of $ per share under our stock option
plan. As of September 30, 1999 there were outstanding warrants entitling the
holders to purchase an aggregate of shares of common stock at a
weighted average exercise price of $ per share. If all of these options and
warrants had been exercised on September 30, 1999 before the issuance of common
stock in this offering, our net tangible book value would have been
approximately $ , or $ per share. On issuance of common stock in
this offering, our net tangible book value on September 30, 1999 would have been
approximately $ , or $ per share, the increase in net tangible book
value attributable to new investors would have been $ per share and the
dilution in net tangible book value to new investors would have been $ per
share.

<PAGE>

SELECTED FINANCIAL DATA

The following selected financial data should be read in conjunction with,
and are qualified by reference to, 'Management's Discussion and Analysis of
Financial Condition and Results of Operations' and our consolidated financial
statements and the notes to our consolidated financial statements, each of which
is included in this prospectus. The selected financial data presented is for the
period from July 5, 1996 (date of inception) through December 31, 1996, the
years ended December 31, 1997 and 1998 and the nine months ended September 30,
1998 and 1999. The statement of operations data for the period from July 5, 1996
(date of inception) to December 31, 1996 and for the years ended December 31,
1997 and 1998 and the balance sheet information as of December 31, 1997 and 1998
are derived from our financial statements, which have been audited by Ernst &
Young LLP, independent auditors, and are included elsewhere in this prospectus.
The balance sheet data as of December 31, 1996 are derived from our audited
financial statements, which are not included in this prospectus. The statement
of operations data for each of the nine-month periods ended September 30, 1998
and 1999 and the balance sheet information as of September 30, 1999 are derived
from our unaudited financial statements, which are included in this prospectus.
In the opinion of management, the unaudited interim financial information
includes all adjustments, consisting of only normally recurring adjustments,
considered necessary for a fair presentation of such information. The results of
operations for interim periods are not necessarily indicative of full year
results.

<PAGE>

<TABLE>
<CAPTION>
PERIOD FROM
INCEPTION YEAR ENDED NINE MONTHS ENDED
(JULY 5, 1996) DECEMBER 31, SEPTEMBER 30,
TO DECEMBER 31, ------------------------- --------------------------
1996 1997 1998 1998 1999
---------------- ----------- ----------- ----------- ------------
(IN THOUSANDS, EXCEPT SHARE AND PER SHARE DATA AND OTHER OPERATING DATA)
<S> <C> <C> <C> <C> <C>
STATEMENT OF OPERATIONS DATA:
Network service revenue........ $ -- $ 19 $ 871 $ 517 $ 2,317
Consulting revenue............. 20 329 73 73 --
---------- ---------- ---------- ---------- -----------
Total revenue........ 20 348 944 590 2,317
Operating expenses:
Direct costs of
revenues................ -- 140 634 374 1,762
Selling, general and
administrative.......... 77 1,177 3,975 2,631 10,971
Non-cash equity
consideration........... -- 64 503 503 4,684
Depreciation and
amortization............ 1 23 366 235 1,245
---------- ---------- ---------- ---------- -----------
Total operating
expenses........... 78 1,404 5,478 3,743 18,662
---------- ---------- ---------- ---------- -----------
Operating loss................. (58) (1,056) (4,534) (3,153) (16,345)
Other income (expense), net.... (3) (64) (394) (221) (992)
---------- ---------- ---------- ---------- -----------
Net loss before income taxes... (61) (1,120) (4,928) (3,374) (17,337)
Provision for income taxes..... -- -- -- -- --
---------- ---------- ---------- ---------- -----------
Net loss....................... (61) (1,120) (4,928) (3,374) (17,337)
Accreted dividends on preferred
stock........................ -- -- -- -- (834)
---------- ---------- ---------- ---------- -----------
Net loss applicable to common
stockholders................. $ (61) $ (1,120) $ (4,928) $ (3,374) $ (18,171)
---------- ---------- ---------- ---------- -----------
---------- ---------- ---------- ---------- -----------
Net loss per common share...... $ (0.02) $ (0.33) $ (1.19) $ (1.09) $ (4.06)
---------- ---------- ---------- ---------- -----------
---------- ---------- ---------- ---------- -----------
Weighted average number of
shares outstanding........... 3,339,500 3,439,714 4,156,836 3,105,081 4,479,112
---------- ---------- ---------- ---------- -----------
---------- ---------- ---------- ---------- -----------
OTHER FINANCIAL DATA:
Net cash used in operating
activities................... $ (64) $ (891) $ (3,340) $ (2,124) $ (10,884)
Net cash used in investing
activities................... (9) (350) (1,241) (895) (10,915)
Net cash provided by financing
activities................... 73 1,362 5,381 3,054 39,452
EBITDA......................... (57) (969) (3,665) (2,415) (10,416)
Capital expenditures........... 3 588 1,979 1,093 13,768

OTHER OPERATING DATA
(AT THE END OF THE PERIOD):
Buildings in service........... -- 2 24 14 80
Rentable square feet of
buildings in service......... -- 309,900 4,508,221 2,782,436 19,865,753
</TABLE>

<TABLE>
<CAPTION>
DECEMBER 31, SEPTEMBER 30,
------------------------------------ -------------
1996 1997 1998 1999
---------- ---------- ---------- -------------
(IN THOUSANDS)
<S> <C> <C> <C> <C>
BALANCE SHEET DATA:
Cash........................................... $ -- $ 122 $ 922 $ 18,575
Property and equipment, net.................... 3 568 2,233 14,852
Total assets................................... 20 906 4,224 37,222
Total liabilities.............................. 5 845 8,772 7,824
Redeemable preferred stock..................... -- -- -- 40,239
Total stockholders' equity (deficit)........... 15 61 (4,548) (10,841)
</TABLE>

<PAGE>

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

The following discussion and analysis should be read in conjunction with
our consolidated financial statements and the notes to our consolidated
financial statements, each of which is included in this prospectus. This
prospectus contains forward-looking statements relating to future events and our
future financial performance. Actual results could be significantly different
from those discussed in this prospectus. Factors that could cause or contribute
to such differences include those summarized in the section entitled 'Risk
Factors,' as well as those discussed in other sections of this prospectus.

OVERVIEW

We provide comprehensive communications solutions for small and
medium-sized business customers in multi-tenant commercial office buildings. We
began offering services in the New York metropolitan area in September 1997. To
date, we have contracts with real estate owners to offer our services in
buildings representing approximately million rentable square feet of
commercial office space and have 103 buildings in service representing
approximately 23.8 million rentable square feet. We are also developing a
nationwide data network and have constructed 10 data network access points to
serve up to 22 metropolitan areas. We intend to offer our services in up to 50
metropolitan areas over the next two to three years.

Since our inception in July 1996, our principal activities have consisted
of:

entering into access agreements with real estate owners;

designing, developing and installing our in-building broadband networks;

identifying collocation space and locations for our data network access
points as well as acquiring and deploying equipment and facilities;

obtaining customers;

raising capital;

hiring management and other key personnel;

developing and integrating our billing and collections, operational
support and administrative systems;

negotiating and executing agreements with wholesale communications
providers; and

obtaining required governmental authorizations.

As a result of our development activities and the deployment of our
networks, from inception to date, we have incurred operating losses, net losses
and negative operating cash flow. As of September 30, 1999, we had an
accumulated deficit of approximately $24.3 million. We currently intend to
substantially increase our operating expenses and capital expenditures in an
effort to rapidly expand our infrastructure and network services on a nationwide
basis as well as develop and integrate our billing and collections, operational
support and administrative systems. We expect to incur substantial operating
losses, net losses and negative cash flow during the network build-out and
initial penetration of each new market we enter. These losses and negative cash
flows are expected to continue for at least the next several years.

FACTORS AFFECTING OPERATIONS

REVENUE

We currently derive a majority of our revenue from voice services and high
speed Internet access. We generally enter into one year service agreements with
our customers. Our voice services, including local and long distance, generally
have a monthly recurring line component and a usage-based component charged on a
per call or per minute basis. Data services are generally billed as fixed
monthly recurring charges based on data transfer speeds selected by the
customer. We also bill our customers for non-recurring installation charges and
certain equipment based on

<PAGE>

optional enhanced services, such as network security and virtual private
networks. All of our services are billed monthly in a single invoice.

We also selectively offer our services to customers in buildings in which
we have not installed our in-building broadband network. While providing
services to these customers has lower margins than providing services to our
in-building broadband network customers, we will continue to pursue these
customers to the extent they present strategic opportunities.

The market for voice and data services is highly competitive, and, as such,
we have seen our prices decline, and expect them to continue to decline, over
time. We expect in the coming years that an increasing percentage of our revenue
will come from high speed Internet access, data networking and enhanced services
such as virtual private networking, web-based e-mail, network security products
and remote access services.

DIRECT COSTS OF REVENUE

Our direct costs of revenue primarily include payments to wholesale voice
services providers, Internet and data transmission capacity providers and real
estate owners, as well as costs for customer premises equipment. We pay monthly
recurring and usage-based charges to wholesale voice services providers, which
typically vary based on our customers' monthly usage. In order to provide our
data services, including high speed Internet access, we pay fixed monthly
charges for data transmission circuits between our buildings and our data
network access points, as well as for connecting our data network access to our
Internet and data backbone providers. Our contracts with wholesale voice
services providers and Internet and data transmission capacity providers
typically range in terms from three to seven years and may include minimum
volume commitments. We do not provide or lease telephone equipment to customers.
However, we do install and expense data equipment provided at no cost to our
typical Internet access customer. We expect that our voice and connectivity
service costs will increase as we enter new markets and provide services for new
customers.

SELLING, GENERAL AND ADMINISTRATIVE EXPENSES

Our selling, general and administrative expenses include sales and
marketing, customer service, technical support, information systems, billing and
collections, general management and administrative functions. The number of our
employees in functional areas, such as customer service, engineering and
operations, will increase as we expand our network, and as the number of our
customers increases. Selling, general and administrative expenses include:

Sales and marketing costs. Our sales and marketing efforts focus on
creating, expanding and retaining our relationships with real estate
owners as well as the tenants of the buildings. Sales and marketing
includes costs of employee salaries and commissions, marketing,
advertising and promotional expenses.

General and administrative costs. As we expand our network, we expect the
number of employees located in specific markets to grow. Certain
functions, such as customer service, network operations, finance, billing
and site planning, are likely to remain centralized in order to achieve
economies of scale.

NON-CASH EQUITY CONSIDERATION

Non-cash equity consideration includes:

a charge for compensation to one of our officers;

amortization of deferred compensation resulting from the granting of stock
options and sales of restricted stock to our employees with exercise
prices per share treated for accounting purposes as below the fair value
of our common stock at the dates of grant. We are amortizing the deferred
compensation over the vesting period of the applicable stock option or
restricted stock. We expect to incur deferred compensation in current and
future quarters and these amounts could be material; and

<PAGE>

in November and December 1999, we agreed to issue warrants to real estate
agents to acquire shares of our common stock at an exercise price of $2.36
per share in exchange for services related to the facilitation of access
agreements with real estate owners. These warrants will vest upon the
performance of services or execution of access agreements with real estate
owners. The measurement dates for valuing the warrants will be the dates
on which the warrants vest. On the measurement dates, the prevailing fair
market value of the common stock less the exercise price of the warrants
will be expensed as non-cash equity consideration.

DEPRECIATION AND AMORTIZATION

Depreciation and amortization primarily includes depreciation of cabling
infrastructure, hardware and software, furniture and fixtures, and leasehold
improvements. Cabling infrastructure includes installation expense, such as the
capitalization of salaries and overhead in connection with installations of our
in-building broadband networks. We expect depreciation and amortization to
increase significantly as we expand and add new buildings to our network.

In November and December 1999, we agreed to issue to real estate owners
warrants to acquire shares of our common stock at an exercise price of $2.36 per
share. These warrants will vest upon the execution of access agreements for
specific buildings. The measurement dates for valuing the warrants will be the
dates on which the real estate owners sign the access agreements for specific
buildings. The fair value of the warrants will be capitalized and amortized over
future periods not to exceed the term of the related access agreements.

OTHER INCOME (EXPENSE), NET

Other income (expense), net consists primarily of net interest expenses
associated with our borrowings.

INCOME TAXES

Prior to July 1, 1999, our predecessor entities were limited liability
companies and, as such, all federal and state income taxes were the
responsibility of the members. From July 1, 1999 to September 30, 1999, we have
not generated any taxable income and, therefore, have not paid any federal
income taxes for this period. A full valuation allowance has been recorded on
the net deferred tax asset, consisting primarily of start-up costs and net
operating loss carryforwards, because of the uncertainty of the realization of
the deferred tax asset. As of September 30, 1999, this valuation allowance was
approximately $2.2 million. In the future, if we achieve operating profits and
the net operating losses have been exhausted or have expired, we may experience
significant tax expense.

RESULTS OF OPERATIONS

REVENUE

We began offering commercial services in September 1997 and network service
revenue for 1997 was $18,831. In addition, we provided consulting services to a
communications carrier under a service contract beginning in 1996 and ending the
first quarter of 1998. Revenue associated with this contract is shown as
consulting revenue, and we do not expect to provide similar services in the
future. During 1998 and 1999, we continued the development of our operations and
experienced growth in the number of buildings under contract, in-building
broadband networks installed and implemented and customers. Network service
revenue for 1998 was $870,846. Network service revenue for the nine-month period
ended September 30, 1999 was $2.3 million as compared to $516,441 for the
corresponding period in 1998. The increase in network service revenue for this
period is primarily attributable to growth in the number of in-building
broadband networks implemented and the growth in the number of customers due to
increased sales and marketing efforts within these buildings.

<PAGE>

In 1998, provision of services to customers in buildings in which we have
not installed our in-building broadband network accounted for approximately 10%
of our revenue. For the nine months ended September 30, 1999, provision of
services to these customers accounted for approximately 9% of our revenue
compared to 13% for the corresponding period in 1998.

Revenue from a limited number of customers has comprised a substantial
portion of our revenue and may represent a substantial portion of our revenue in
the future. In 1998, our five largest customers accounted for approximately 41%
of our revenue. For the nine months ended September 30, 1999, our five largest
customers accounted for approximately 25% of our revenue. Any cancellation,
deferral or significant reduction in services provided to these customers or a
significant number of smaller customers would have a material adverse effect on
our financial condition and results of operations.

Revenue from customers located within the buildings of a limited number of
real estate owners has comprised a substantial portion of our revenue and may
represent a substantial portion of our revenue in the future. In 1998, customers
located within the buildings of our three largest real estate owners accounted
for approximately 85% of our revenue. For the nine months ended September 30,
1999, customers located within the buildings of our five largest real estate
owners accounted for approximately 66% of our revenue. Real estate owners may
permit competitors to offer services within their buildings or terminate or fail
to renew our access agreements, any of which would have a material adverse
affect on our financial condition and results of operations. In addition, any
deterioration in our relationship with these real estate owners or a significant
number of smaller real estate owners would have a material adverse effect on our
financial condition and results of operations.

DIRECT COSTS OF REVENUE

From our inception through December 31, 1997, direct costs of revenue were
$139,580. For 1998, we recorded direct costs of revenue of $634,211. For the
nine-month period ended September 30, 1999, direct costs of revenue were $1.8
million as compared to $374,128 for the corresponding period in 1998. The
increase in direct costs of revenue for this period is primarily attributable to
growth in the number of in-building broadband networks implemented and the
growth in the number of customers due to increased sales and marketing efforts.

SELLING, GENERAL AND ADMINISTRATIVE EXPENSES

From our inception through December 31, 1997, selling, general and
administrative expenses were $1.3 million and consisted primarily of salaries
and legal and consulting fees incurred to establish a management team and
develop our business. For 1998, selling, general and administrative expenses
were $4.0 million. For the nine-month period ended September 30, 1999, selling,
general and administrative expenses were $11.0 million as compared to $2.6
million for the corresponding period in 1998. This increase is attributable to a
continued increase in staffing levels, increased marketing and advertising
efforts coinciding with the launch of commercial services on a nationwide basis,
increased legal fees associated with the development of additional markets and
office rent for our new headquarters.

NON-CASH EQUITY CONSIDERATION

We incurred non-cash equity consideration expenses in the amount of $63,642
in 1997 and $502,500 in 1998 for the issuance of options to one of our officers
to purchase equity interests in our company. For the nine months ended
September 30, 1999, we incurred non-cash equity consideration expenses in the
amount of $4.7 million for the issuance of stock options and restricted stock to
employees and officers of our company, compared to $502,500 for the
corresponding period in 1998. In future periods, we will record non-cash equity
consideration expenses from the issuance of stock options and restricted stock
over their vesting periods.

<PAGE>

Although we have not recognized non-cash equity consideration expenses
related to warrants issued to real estate agents, we expect to do so in future
periods and these amounts will be material.

DEPRECIATION AND AMORTIZATION

Depreciation and amortization was negligible for the period from our
inception through December 31, 1997 and was $366,087 for 1998. For the
nine-month period ended September 30, 1999, depreciation and amortization
expenses were $1.2 million as compared to $234,556 for the corresponding period
in 1998. The increase in depreciation and amortization costs is primarily
attributable to the deployment of our nationwide data network and to growth in
the number of in-building broadband networks installed. In future periods, we
expect depreciation and amortization to increase significantly.

Although we have not recognized amortization expense related to warrants
issued to real estate owners, we expect to do so in future periods and these
amounts will be material.

OTHER INCOME (EXPENSE), NET

From our inception through December 31, 1997, net interest expense was
$66,960, which was primarily attributable to preferred return allocations to
members in the predecessor limited liability company. For 1998, we recorded net
interest expense of $393,657, consisting primarily of interest expense on $6.5
million of convertible debt issued to an affiliate of Reckson Service
Industries. For the nine-month period ended September 30, 1999, net interest
expense was $1.0 million, which was primarily attributable to interest expense
on the $6.5 million of convertible debt issued to an affiliate of Reckson
Service Industries as well as interest expense on $20.0 million of promissory
notes issued to a group of private equity investors consisting of Reckson
Service Industries, Veritech Ventures LLC, Spectrum Equity Investors, III, L.P.,
J.P. Morgan Investment Corporation, Crosspoint Venture Partners and AT&T Venture
Fund II, L.P. This group is referred to in this prospectus as the 'private
equity investors.' The interest expense also includes the interest paid on a
$3.0 million senior secured promissory note issued to an affiliate of Reckson
Service Industries and to JAH Realties, L.P., an affiliate of a stockholder. For
the nine-month period ended September 30, 1998, net interest expense was
$221,272, which was primarily attributable to interest expense on the $6.5
million of convertible debt issued to an affiliate of Reckson Service
Industries.

<PAGE>

QUARTERLY FINANCIAL INFORMATION

The following table presents our unaudited quarterly statement of
operations data for 1998 and the first three quarters of 1999. This information
has been derived from our unaudited financial statements. In the opinion of
management, this unaudited information has been prepared on the same basis as
the annual financial statements and includes all adjustments consisting only of
normal recurring adjustments necessary for a fair presentation of the
information for the quarters presented. This information should be read in
conjunction with the financial statements and related notes included elsewhere
in the prospectus. The operating results for any quarter are not necessarily
indicative of results for any future period.

<TABLE>
<CAPTION>
THREE MONTHS ENDED
---------------------------------------------------------------------------------------
DEC. 31, MAR. 31, JUNE 30, SEPT. 30, DEC. 31, MAR. 31, JUNE 30, SEPT. 30,
1997 1998 1998 1998 1998 1999 1999 1999
-------- -------- -------- --------- -------- -------- -------- ---------
(IN THOUSANDS)
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Network service revenue.............. $ 19 $ 81 $ 165 $ 271 $ 354 $ 547 $ 748 $ 1,022
Consulting revenue................... -- 73 -- -- -- -- -- --
----- ----- ------ ------- ------- ------- ------- --------
Total revenue................ 19 154 165 271 354 547 748 1,022

Operating expenses:
Direct costs of revenue.......... 58 69 126 179 260 410 562 790
Selling, general and
administrative................. 503 558 798 1,275 1,344 1,744 3,365 5,862
Non-cash equity consideration.... -- -- -- 503 -- -- -- 4,684
Depreciation and amortization.... 16 51 81 103 131 202 330 713
----- ----- ------ ------- ------- ------- ------- --------
Total operating expenses..... 577 678 1,005 2,060 1,735 2,356 4,257 12,049
----- ----- ------ ------- ------- ------- ------- --------
Operating loss....................... (558) (524) (840) (1,789) (1,381) (1,809) (3,509) (11,027)
Other income (expense), net.......... (41) (43) (60) (118) (173) (281) (753) 42
----- ----- ------ ------- ------- ------- ------- --------
Net loss............................. $(599) $(567) $ (900) $(1,907) $(1,554) $(2,090) $(4,262) $(10,985)
----- ----- ------ ------- ------- ------- ------- --------
----- ----- ------ ------- ------- ------- ------- --------
</TABLE>

LIQUIDITY AND CAPITAL RESOURCES

The development and expansion of our business requires significant capital
expenditures. From inception through September 30, 1999, we have incurred
capital expenditures, including equipment held under capital leases, totaling
$16.3 million, primarily related to the construction of in-building broadband
networks and the buildout of data network access points.

To date, we funded our capital expenditures and operating losses through
various financings, including:

a $6.5 million convertible subordinated promissory note issued to an
affiliate of Reckson Service Industries in February 1998, which was
converted into 5,869,000 shares of Series A preferred stock in July 1999;

a $3.0 million senior secured promissory note issued to both JAH Realties,
L.P. and an affiliate of Reckson Service Industries in February 1999;

promissory notes for an aggregate principal amount of $20.0 million issued
to the private equity investors in April 1999. With the proceeds from the
$20.0 million in promissory notes, we repaid the $3.0 million senior
secured promissory note issued to both JAH Realties and an affiliate of
Reckson Service Industries;

as part of our reorganization and recapitalization transaction, we entered
into a preferred stock purchase agreement with our private equity
investors in April 1999. Pursuant to this agreement, we issued an
aggregate of 75,461,745 shares of Series B, Series C and Series D
preferred stock to our private equity investors in three installments from
July to December 1999, for an aggregate consideration of $60.0 million. We
issued the first installment of preferred stock to these private equity
investors in exchange for the cancellation of the $20.0 million in
promissory notes, plus accrued and unpaid interest of approximately
$500,000; and

in July 1999, pursuant to a subscription agreement, we issued 511,620
shares of our common stock to various affiliated parties for an aggregate
purchase price of $230,229.

<PAGE>

Upon completion of this offering, all outstanding shares of our Series A,
Series C and Series D preferred stock will automatically convert into shares of
our common stock on a one-for-one basis, and all outstanding shares of our
Series B preferred stock will automatically convert into shares of our common
stock at the initial public offering price.

We have operating lease commitments for office space and equipment which
expire through July 31, 2010. These operating leases provide for basic annual
rents plus escalation charges. Our minimum commitments through the life of these
leases amount to approximately $11.0 million.

In September 1999, we entered into a line of credit with Ascend
Communications, a wholly owned subsidiary of Lucent Technologies, Inc., which
expires on September 30, 2000. Under this line of credit, we may borrow $50
million for purchases of equipment from Lucent Technologies. Each draw on the
line of credit converts into a new 36 month lease. At September 30, 1999, we
made our first draw under this line of credit for $2.3 million. As of
September 30, 1999, future minimum lease payments under all existing equipment
leases, as well as the capital lease with Ascend, are $3.1 million.

We are in discussions with several financial institutions regarding a line
of credit for up to approximately $50 million. We expect to obtain this
financing prior to the completion of this offering; however, we cannot give any
assurance that we will obtain this financing.

We have also entered into contracts with our wholesale voice services
providers, Internet access providers and data transmission capacity providers.
If we fail to meet our minimum volume commitments for national connectivity
under these contracts, we will be obligated to pay underutilization charges.
Future minimum obligations through 2003 related to these contracts amount to
approximately $12.0 million.

We currently intend to substantially increase our operating expenses and
capital expenditures in an effort to rapidly expand our infrastructure and
network services on a nationwide basis. In addition, we intend to develop and
integrate our billing and collections, operational support and administrative
systems and estimate that modifying or replacing these systems will cost
approximately $34 million over the next two years, although actual costs may be
higher. During our expansion, we expect that our revenues will not increase at a
rate commensurate with these additional operating expenses and capital
expenditures, and therefore, our results of operations and liquidity will be
materially and adversely affected.

To effectively address the next generation of services that our customers
may request, we are also incurring costs to deploy fiber-optic cable as part of
our in-building broadband networks. To the extent our customers request these
services, or there is a significant increase in demand for high bandwidth data
services, we will need to install fiber-optic equipment in conjunction with our
fiber-optic in-building broadband network, and therefore, will incur additional
costs.

we accelerate the schedule or expand the scope of our network rollout
plan;

our plans or projections change or prove to be inaccurate;

we acquire other companies or businesses; or

market conditions allow us to raise public or privately financed capital
on attractive terms.

<PAGE>

YEAR 2000 READINESS

Until recently, computer programs were written to store only two digits of
date-related information in order to more effectively handle and store data.
These programs were unable to distinguish properly between the year 1900 and the
year 2000, and as such, risk failure with the changing of the century. This
circumstance is frequently referred to as the 'Year 2000 issue.'

We rely on information technology systems, applications and equipment in
several aspects of our business, including service delivery, network monitoring
and financial accounting. In this regard, we have conducted an assessment of our
information technology systems and believe that significant changes will not be
necessary in order to achieve a Year 2000 date conversion with little effect on
customers or disruption of business operations.

INTERNAL SYSTEMS

We acquired our internal systems from third party vendors, and we have
surveyed and received assurances from these vendors either that the products we
use are Year 2000 ready or that their recommended upgrades, which we have
installed, are Year 2000 ready. In addition to these assurances, we test all
third party products to determine whether they are Year 2000 ready. We are not
currently aware of any material operational issues associated with preparing our
systems for the Year 2000. Despite the assurances we receive, and the testing we
perform we may experience material unanticipated problems, both operational and
other, as a result of the Year 2000. In addition, there can be no guarantee that
we identified and remediated all of our material systems that could potentially
be impacted by the Year 2000. We may also experience material unexpected costs
or business interruption caused by undetected errors or defects in the
technology used in our systems. This could have a material adverse effect on our
business, financial condition, results of operations and the price of our common
stock.

VENDORS

We rely on communications providers to deliver services to our customers
and on other third party vendors for the equipment used in our in-building
broadband networks and data network access points. Our ability to provide our
voice and data services is dependent on the Year 2000 readiness of these third
parties. We have sought assurances from the communications carriers and third
party vendors we use that they are Year 2000 ready. Nevertheless, we cannot test
the Year 2000 readiness of such third parties, and failure of any of these third
parties to be Year 2000 ready by January 1, 2000 could result in a deterioration
in the performance of our network or other systems, or a complete system
failure, which would have a material adverse effect on our business, financial
condition, results of operations and the price of our common stock.
Additionally, data service providers who rely on the Internet could face serious
disruptions arising from the Year 2000 issue. We are also subject to external
forces that might generally affect industry and commerce, such as utility Year
2000 compliance failures and related service interruptions. All of these factors
could have a material adverse effect on our business, financial condition,
results of operations and the price of our common stock.

CUSTOMERS

The ability of our customers to receive our services depends on the
readiness of their personal computer equipment and the equipment and services of
communications and other third party vendors. We do not currently have any
information concerning the Year 2000 readiness status of our customers. If our
current or future customers fail to achieve Year 2000 readiness, it could have a
material adverse effect on our business, financial condition, results of
operations and the price of our common stock.

COSTS/CONTINGENCY PLANS

We do not anticipate our expenses for our Year 2000 compliance to be
material. However, the cost of developing and implementing a comprehensive
contingency plan, if necessary, could be material. We have not developed a
contingency plan to address situations that may result if either we or third
parties upon whom we rely are unable to achieve Year 2000 readiness.

<PAGE>

BUSINESS

OUR BUSINESS

Our facilities-based, building-centric approach is designed to address the
current and evolving communications needs of our customers. This approach
consists of developing a customized in-building broadband network that we
design, install, own and operate within multi-tenant commercial office buildings
and providing focused consultative sales and customer service. We believe that
by owning and operating the in-building broadband network, or what we refer to
as the 'first foot' of the communications network, we can better control our
relationship with our customers, from initial provisioning to ongoing customer
care, without requiring them to interface with other communications providers.
Our in-building broadband network, together with our consultative customer sales
and support, enables small and medium-sized businesses to obtain core telephony
services bundled with bandwidth-enabled data services, which we believe are not
otherwise available to them on a cost-effective basis.

OUR MARKET OPPORTUNITY

Small and medium-sized businesses represent a significant portion of the
total communications spending in the United States. According to International
Data Corporation, there are 7.4 million businesses in the United States with
under 100 employees. International Data Corporation estimates that spending on
voice and data communications by these customers totaled $53 billion in 1998,
and is expected to grow to $83 billion by 2003.

We believe that small and medium-sized businesses represent an attractive
market opportunity that has not been adequately served by incumbent local
telephone companies or competitive service providers. We believe that one of the
reasons this market segment has been underserved has been the inability of
incumbent service providers with legacy in-building narrowband networks to
obtain capital and operating efficiencies similar to those currently attained by
servicing large business customers. To achieve such efficiencies, we use
broadband technologies to focus on multi-tenant commercial office buildings
where small and medium-sized business are co-located. We believe that the high
concentration of target customers within these buildings creates efficiencies
for the deployment of our in-building broadband network and the marketing of our
services. Since these businesses often lack the scale and resources to hire
dedicated in-house communications professionals, we have found that they value
the simplified approach of working with a single source provider of integrated
communications solutions.

The U.S. Department of Energy estimates that there are approximately
188,000 commercial buildings in the United States larger than 50,000 square
feet, the majority of which we believe are multi-tenant commercial buildings. We
typically target commercial office buildings with greater than 50,000 rentable
square feet and ten or more tenants whose communications needs we believe are
underserved. The principal in-building communications network for the vast
majority of these buildings consists of original copper wiring installed by the
incumbent local telephone company. We have found that these legacy networks are
inadequate for provisioning high quality, high speed data services that are
increasingly demanded by small and medium-sized business customers.

<PAGE>

Accordingly, we believe we are well positioned to fully and cost-effectively
address the complete set of voice, data and enhanced services needs of this
market segment through our facilities-based, building-centric approach.

OUR STRATEGY

Offer a bundled package of communications services. We offer a complete
suite of voice, data and enhanced services to our customers. In many
cases, we initiate the customer relationship with voice services and
expand into data and other enhanced services. By offering comprehensive
communications services, we believe we can provide a customized suite of
services to fit each customer's individual needs. We believe that
customers who purchase our bundled services prefer a single provider for
all services as opposed to many individual providers for each service, and
therefore, are less likely to seek other providers.

Establish lasting relationships with our customers. We deliver responsive,
high quality service and customer care on a personalized basis to foster
lasting relationships with our customers. We provide tenants with
continuous sales and marketing service through our dedicated consultants,
whom we refer to as 'building communications managers.' We also provide
tenants with operational support and customer service through our customer
care representatives and customer service coordinators. We believe that
this focused team approach forges close relationships with our customers
and promotes increased customer penetration and retention.

Create new distribution channels to address our customers' communications
and Internet needs. We plan to expand our service offerings to include new
broadband and web-based services. We also intend to market and deliver
many of these new services to our customers through an enhanced web-based
interface that will allow our customers to obtain communications and
web-based services and various local and building-related services. For
that purpose we will develop web portals designed for individual buildings
through which we will provide both value added services for our customers
and real estate owners and a marketing and sales channel for our data
service partners, increasing bandwidth usage over our data network.

Partner with real estate owners. We will continue to establish mutually
beneficial relationships with real estate owners to facilitate our access
to buildings and penetration of our target customer base. We often work
with real estate owners to develop a joint marketing strategy to reach
prospective customers. Partnering with owners of large portfolios of
buildings also enables us to expand quickly and efficiently on a
nationwide basis. Building owners benefit from these relationships through
the addition of a no-cost, value-added technology upgrade to their
buildings as well as the opportunity to receive a portion of the
communications services revenue generated within their buildings.

Deploy capital efficient in-building broadband networks. We typically
install both copper and fiber-optic cabling in our served buildings, which
enables us to address the current needs of our customers while providing
for future growth in broadband capacity and increases in service features.
Initially, we deploy copper-based digital subscriber line equipment while
deferring investments in more expensive fiber-optic switching equipment.
We believe our digital subscriber line technology is capable of providing
the bandwidth necessary to satisfy our customers' current data needs while
requiring significantly less capital investment than immediately
activating our fiber-optic infrastructure. We selectively install
switching equipment for use with our fiber-optic cabling when a customer
has bandwidth needs exceeding the current capabilities of our copper-based
infrastructure. By minimizing our initial capital outlay, we broaden our
target market opportunity because we can economically

<PAGE>

serve a wider range of building sizes and pursue more cost-effective
customer penetration within buildings.

Own and control critical network elements. We own the critical in-building
broadband network elements of our served buildings, including the copper
and fiber-optic cabling and related high speed data communications
equipment. We are also developing a nationwide data network that connects
our served buildings and allows us to gain the cost and performance
advantages of data traffic aggregation, routing redundancy and proactive
network monitoring. We believe that owning data network elements, such as
switching equipment and application servers, enables us to create a
platform for providing highly reliable broadband applications. We believe
that these investments increase our control over the data network and
enhance our ability to provide faster, more reliable data services.

Expand our network to other major metropolitan areas. We are developing a
nationwide data network and have constructed 10 data network access points
to serve up to 22 metropolitan areas. We intend to offer our services in
up to 50 metropolitan areas over the next two to three years.

OUR SOLUTION

Our solution offers a number of advantages to small and medium-sized
business customers, including:

Comprehensive communications solutions. We offer scalable solutions
designed to meet the complete communications needs of small and
medium-sized business customers. Our services include: (1) voice services,
such as local and long distance, and custom calling features, (2) data
services such as high speed Internet access and data networking and
(3) enhanced services such as e-mail, web hosting, virtual private
networks and network security. Our bundled services are billed in a single
invoice for increased customer convenience.

Competitively priced services. Efficiencies created by our in-building
broadband network and the concentration of target customers within our
served buildings allow us to offer bundled services on a cost-effective
basis. We offer local voice services that are typically priced lower than
comparable voice services provided by incumbent local telephone companies.
We also offer long distance and high speed Internet access at competitive
rates and provide additional discounts to customers who purchase bundled
services.

Dedicated building communications managers. We create a local, single
point of contact for our customers by assigning a building communications
manager to each building to manage the ongoing relationship with each
customer. Our building communications managers work with existing and
prospective customers to identify solutions for their communications
needs. Once these requirements have been identified, the building
communications manager works with our operations department to develop and
deliver a customized bundle of services targeted to those customer's
current and evolving communications needs. We provide on-going incentives
for our building communications managers to increase customer penetration
and retention.

Rapid and easy provisioning. Unlike other communications providers who
rely on incumbent local telephone companies to complete each customer
installation, once we have installed our in-building broadband network, we
are typically able to provision services to a new customer on an average
of five business days. We connect each customer's voice and local area
networks directly to our in-building broadband network so that our
customers usually do not need to purchase or install any new equipment.
Our in-building broadband network also allows our existing customers to
upgrade to higher bandwidth data services or provision new services
without dispatch of technical personnel.

Responsive customer service. We have developed an organizational structure
dedicated to being responsive to customer needs and concerns. We maintain
a network operations center which permits us to identify and resolve
network problems efficiently. We also maintain a

<PAGE>

toll-free customer service hotline and employ field support technicians
who are on call 24 hours a day, 365 days a year.

Enhanced services. We currently provide our customers with enhanced
services including web-based e-mail, web hosting, virtual private
networking and network security products and services. Through internal
development and selective strategic alliances with commerce, content and
technology providers, we anticipate offering additional enhanced services
in the future. We have designed our in-building and nationwide data
networks to be capable of providing high availability, bandwidth-enabled
data services such as Internet protocol-based video streaming, information
technology outsourcing and business applications hosting.

OUR NETWORK

We believe our network architecture is designed to address the current
voice, data and enhanced services needs of our small and medium-sized business
customers in a capital efficient manner while ensuring that feature and
bandwidth capabilities exist to provide next generation services. We invest in
network facilities when we believe such investment provides competitive cost and
performance advantages.

NETWORK ARCHITECTURE

The major elements of our in-building and nationwide network architecture
include:

an in-building broadband network consisting of (1) a physical
point-of-presence in which we install and manage voice communications
equipment provided by our wholesale voice services providers and in which
we own, install and manage high speed data communications equipment and
(2) copper and fiber-optic cabling that we configure, install, own and
manage in the building's vertical utility shaft, also known as its riser
system;

nationwide data network access points consisting of high speed data
switching equipment and application servers that we own and co-locate with
national backbone providers;

voice and data transmission capacity provided through (1) our wholesale
voice services providers' network for voice services and (2) leased
communications capacity connecting our served buildings to our data
network access points and our data network access points to our network
operations center for data services; and

a network management system that we own and operate to monitor network and
system availability, performance and usage 24 hours a day, 365 days a
year.

IN-BUILDING BROADBAND NETWORK

We typically install both copper and fiber-optic cabling in our served
buildings, which enables us to address the current communications needs of our
customers while providing for future growth in broadband capacity and increase
in service features. The cabling extends from a termination block on each floor
to the voice and data switching equipment housed in our physical
point-of-presence. When a customer in the building initially requests service,
our technician extends a connection from the floor termination block to a
demarcation point inside the customer's leased office space. For data customers,
additional equipment is installed in the customer's premises and connected to
their internal local area network.

Each of our buildings typically has a dedicated 100 square foot locked
space that houses voice and data communications equipment. This area serves as
our physical point-of-presence within the building and is built to our
specifications to include primary power supplies and battery back-up equipment
capable of providing up to eight hours of standby power.

For data services, we typically own and install at our physical
point-of-presence digital subscriber line access multiplexer equipment capable
of providing high speed Internet and data connections to our customers within a
building. We believe our digital subscriber line technology is capable of
providing the bandwidth necessary to satisfy our customers' current data needs
and

<PAGE>

requires significantly less capital investment than immediately activating our
fiber-optic infrastructure. Our digital subscriber line equipment and copper
cabling can provide symmetrical data connections with speeds of up to
1.5 million bits per second today and is expected to expand to 6.0 million bits
per second within the next twelve months.

The speed and effectiveness of digital subscriber line technology vary
based on the quality of the copper cable and the distance of the end user from
the digital subscriber line access multiplexer equipment, which is typically
housed in a telephone carrier's central office. By locating data communications
equipment in our served buildings, we reduce the distance that our copper
cabling infrastructure extends from the furthest end user to the communications
equipment in our building point-of-presence. This distance is typically less
than 1,000 feet. We expect that the highest speed digital subscriber line
technologies can be deployed over our in-building copper infrastructure.

To ensure high quality service, we configure our in-building copper cabling
to minimize the potential interference and service degradation that can result
from transmitting voice and data signals over a shared medium. In addition, our
in-building copper cabling does not have elements such as loading coils or
bridged taps, which were commonly used by incumbent local telephone companies to
extend the functional reach of copper cable from their central office. Digital
subscriber line providers that provision service from an incumbent local
telephone company's central office often have to locate and remove loading coils
and bridged taps from the copper cable in order to provide service, an expensive
and inconvenient process.

For voice services, we connect our copper cabling infrastructure with a
voice digital loop carrier, which is owned by our wholesale voice services
provider and is located at our physical point-of-presence. We are evaluating new
technologies which would allow the integration of voice traffic from the
existing voice digital loop carrier equipment onto our owned data network
equipment. Since this migration would require additional capital expenditures,
we continue to evaluate this development as it becomes more efficient and
economical for our customers.

DATA NETWORK ACCESS POINTS

For our nationwide data network, we connect our in-building broadband
network to a regional data network access point. In most markets, we also use a
local data network access point to aggregate and direct traffic to a regional
data network access point. The regional data network access point consists of
application servers, communications traffic routers and data switching equipment
to provide connectivity to nationwide Internet service providers, also known as
Internet backbone providers. The switching equipment housed in our data network
access points can manage asynchronous transfer mode, frame relay and Internet
protocol transmissions, all of which are high speed, digital transmission
technologies. We generally connect each regional data network access point to
multiple Internet service providers to provide redundant Internet connectivity
to our network. In each of our regional data network access points, we co-locate
application servers that interconnect to other network and application service
providers. This approach allows us to provide value-added data applications to
our customers with a highly reliable, high speed nationwide network.

VOICE AND DATA TRANSMISSION CONNECTIVITY

For our voice network, our wholesale voice services providers are typically
responsible for connecting our in-building networks to their external
facilities. Currently, our wholesale voice services providers monitor all our
voice service elements.

For our data network, we lease the communications capacity that connects
the buildings we serve to our data network access points. A data network access
point connects to a national backbone as well as to our network operations
center where we manage and monitor our network traffic.

<PAGE>

NETWORK MANAGEMENT SYSTEM

We have built a network management system that monitors network and systems
availability, performance and usage 24 hours a day, 365 days a year. Our network
operations center generally allows us to test equipment at each point in our
in-building and nationwide data networks.

REAL ESTATE ACCESS

Prior to deploying our in-building broadband networks, we secure access
rights from the real estate owner to install and operate our in-building
broadband network within the commercial office building. Our typical license or
access agreement has an initial term of approximately five to ten years, with
renewal options ranging from five to fifteen years. Those agreements also may
provide for a marketing arrangement under which the real estate owner recommends
our services to existing and prospective tenants.

Property selection. Our real estate professionals select properties,
negotiate access agreements and facilitate partnerships with commercial real
estate owners nationwide. We focus on real estate investment trusts, property
managers, real estate agents and owners with portfolios of local properties. We
also target insurance companies and pension funds that hold commercial real
estate. We consider a number of factors in selecting buildings for our services,
including building location, building size, number of tenants, tenant mix,
revenue opportunity, competition, network access and build-out costs. We
typically target buildings with more 50,000 rentable square feet and ten or more
tenants. In addition, we evaluate the presence of any existing communications
providers in the building.

Value to Real Estate Owners. We offer the following value proposition to
real estate owners:

No cost, technology upgrade. We install, at no cost to the real estate
owner, an in-building broadband network that becomes an amenity to the
building.

Marketing and leasing amenity. Our services represent a significant
marketing and leasing amenity to attract and retain tenants, which we
believe increases tenant satisfaction and results in increased occupancy
and rental rates.

Recurring incremental revenue stream. We provide real estate owners with
the opportunity to share in the communications services revenues generated
within their buildings.

Building communications manager as an extension of the building staff. We
assign to each property a building communications manager who functions as
an extension of the building staff and is available to assist with the
day-to-day communications requirements of the tenants at no cost to the
real estate owner.

Real estate marketing. We support our business development efforts with
local and national advertising, trade show marketing and other marketing
support. We believe these efforts will be critical in facilitating the branding
of our company among real estate owners, brokers and management and leasing
agents and in educating them on the value of our services. The majority of the
advertising activities have been and will be focused within real estate trade
journals, as well as other local and national publications with sections
dedicated to or targeted to the real estate community.

Real estate agents and property managers. We plan to develop relationships
with third party agents or property managers who have influence with real estate
owners. These agents and managers are either large national real estate
brokerage firms or large national real estate tele-communications management
organizations. The terms of these relationships may require us to pay fees or
issue equity in our company in return for facilitating contracts with real
estate owners. In addition, we sometimes pay referral fees for contracted
buildings.

<PAGE>

OUR MAJOR REAL ESTATE RELATIONSHIPS

We have access agreements with a number of large national and regional real
estate owners, representing approximately million rentable square feet of
commercial office space in metropolitan areas.

<TABLE>
<CAPTION>
REAL ESTATE OWNER MARKETS
- ----------------- -------
<S> <C>
Angelo, Gordon & Co. ...... Dallas, Denver, Indianapolis, Los Angeles, New York Tri-State
Area, Philadelphia, Phoenix and Washington, DC
Childress Klein Properties. Atlanta, Austin
JMB/Walton Street Capital.. Boston, Chicago, Cleveland, Houston, Los Angeles,
Minneapolis, Pittsburgh, San Diego, San Francisco, Seattle,
South Florida
Reckson Associates......... New York Tri-State Area
SL Green Realty............ New York Tri-State Area
Starwood Capital........... Boston, Chicago, Los Angeles, New York Tri-State Area, Phoenix,
Washington, DC
The Taylor Simpson Group... Atlanta, Dallas, Detroit, Minneapolis, New York Tri-State Area, South
Florida, St. Louis
Tishman Speyer Properties.. Chicago, Indianapolis, Los Angeles, New York Tri-State Area, Orlando,
Washington, DC
Trizec Hahn................ Chicago, Detroit, Kansas City, Los Angeles, Minneapolis,
New York Tri-State Area, Pittsburgh, St. Louis
The Witkoff Group.......... Chicago, Dallas, New York Tri-State Area, Philadelphia
</TABLE>

In addition, we have agreements with both building communications agents
and leasing agents, including Cushman & Wakefield, Insignia/ESG and US Realtel.

NETWORK DEPLOYMENT PROCESS

We have assembled a group of communications professionals and construction
engineers with experience in riser infrastructures, local and wide area networks
and fiber-optics. We believe that our communications and construction
capabilities allow us to rapidly and efficiently deploy our in-building networks
within the markets we penetrate.

Standardized in-building broadband network model. Our communications
professionals and construction engineers have developed a standardized
in-building broadband network model that we can adapt and customize to a
particular building. This basic model is designed to achieve optimal service
delivery to our customers, maximize the technological and cost-efficiency of our
combination copper and fiber-optic cabling infrastructure and minimize the space
and resources dedicated to supporting our infrastructure and associated
electronic equipment.

Constructing our in-building broadband network. Prior to the commencement
of construction of an in-building broadband network, our construction engineers
conduct a formal, detailed survey of the building site. Our construction
engineers then develop a network design specific to the building based on our
standard in-building broadband network methodology. The construction engineers
also identify potential contractors from our pool of national and local vendors
to install our in-building broadband network. We typically outsource, on a fixed
price basis, services from cabling contractors and electrical contractors for
installation of the copper and fiber-optic cabling. Our own field technician
installs the voice and data communications equipment and coordinates the
installation process among our vendors to ensure that installation complies with
our design specifications as well as applicable national and local building and
industry codes and standards.

The total construction time for the completion of our in-building broadband
network and related equipment is typically between 60 and 90 days for a
metropolitan area commercial office building. For an average building with
approximately 167,000 rentable square feet, we expect

<PAGE>

to spend approximately $62,500 for the construction of the vertical copper and
fiber-optic infrastructure and the installation of related data electronic
equipment. These construction costs vary considerably with building size,
location, complexity of the construction project and other factors. We choose
not to invest in voice switching equipment or transmission facilities between
our owned network elements.

Building connections to our customers. Once we have completed the
construction and installation of our in-building broadband network and have
received an order for service from a customer, our field technicians connect the
customer's local area data network or telephone system to our in-building
broadband network and install any necessary customer premises equipment.
Typically, this connection can be completed on an average of five business days.
Once this connection is made, our field technician will help the customer test
the network connection to verify that the intended desktops or phones are
receiving our service.

Buildout of data network access points. We inspect, assemble, test and
inventory all data network access equipment prior to installation. We then work
with our collocation provider to identify the equipment location and service
requirements within the particular collocation facility. The equipment is
installed in the collocation facility by us or through a major equipment vendor.

OUR SERVICES

Our service offerings are designed to improve the business communications
capabilities of small and medium-sized business customers and include voice,
data and enhanced services. We provide a customized suite of services to fit our
customers' individual needs. These services fall into three categories and are
summarized as follows:

Voice services. We offer our customers the complete range of local and long
distance voice services that we purchase through our wholesale voice services
providers. Our local voice services include (1) standard phone lines with custom
line features such as voice mail, call waiting, call forwarding, call return,
three way conference calling, extension dialing, call hunting and caller ID and
(2) other high-volume dedicated circuit offerings such as T-1 access, which can
provide up to 24 voice channels. We also offer local number portability, which
allows our customers to retain their existing local phone number when switching
from their current local telephone provider to our service. We provide a
complete range of competitively priced domestic and international long distance
services, toll free service, conference calling, calling cards and operator
services.

Data services. Our data services currently include high speed Internet
access, frame relay data networking and other high-speed data transmission
services. We currently provide dedicated high speed Internet access in a variety
of bandwidth connections with symmetrical speeds of up to 1.5 million bits per
second. We expect to provide transmission speeds of up to 6.0 million bits per
second within the next twelve months. While some data service providers require
a user to dial a phone number and wait while the modem connects to the Internet,
our dedicated service is 'always on,' providing instantaneous connection to the
Internet and the ability to send and receive data continuously. We selectively
install fiber-optic switching equipment for use with our fiber-optic cabling
when a customer's current bandwidth needs exceed the existing capabilities of
our copper infrastructure.

Enhanced services. We offer enhanced services designed to provide
enterprise solutions for small and medium-sized businesses. These services
include (1) web-based e-mail, a hosted service based on a web mail interface
that requires no software downloads or configurations, (2) web-hosting, a
managed data service that provides customers with a web presence, (3) virtual
private networking, a data networking solution for secure, cost-effective
transmission of private Internet protocol traffic through the Internet and
(4) network and data security products and services which include corporate
firewall, user authentication and data encryption services.

We intend to increase our service offerings in the future to include
value-added business applications including (1) unified messaging services,
which allow users to send and receive e-mail, voicemail and faxes through a
single interface, (2) Internet protocol-based video conferencing,
(3) e-commerce services, which provide users the ability to sell products and
services on the

<PAGE>

Internet, (4) remote file storage and back-up and (5) business software
management, all delivered through a single, broadband connection that we
provide. We have designed our in-building broadband and nationwide data networks
to be capable of providing high availability, bandwidth-enabled services.
Through internal development and selective strategic alliances with commerce,
content and technology providers, we anticipate offering these enhanced services
through building-specific web interfaces or web portals.

OUR SALES AND MARKETING

We offer an attractively priced, comprehensive suite of voice and data
services utilizing a consultative sales approach. We use our relationship with
real estate owners, building management and leasing representatives to directly
market our services to the tenants in their properties. The key to our strategy
is our building communications manager, who acts as the building's
communications consultant and is responsible for developing and maintaining
relationships with the tenants within the building. By targeting buildings with
a high concentration of potential customers, we are able to increase the
effectiveness of our sales and marketing efforts.

Building sales and marketing approach. Prior to the completion of our
in-building broadband network, the building communications manager works with
the real estate owner or leasing agents to develop a database of the tenants and
profiles of their businesses and their potential communications needs. The real
estate owner then typically sends a survey and a letter introducing the building
communications manager to each tenant. We also use lobby signage, direct mail
and other promotional events to create awareness of our brand and services among
the tenants of the building. Shortly after completion of the in-building
broadband network, we typically schedule a kick-off lobby event led by the
building communications manager to provide tenants with the opportunity to meet
our employees and familiarize themselves with our services. The building
communications manager then follows up with direct consultative sales efforts
supported by on-going promotions which may include installation fee waivers or
discounts.

Building communications managers. We recruit our building communications
managers from the communications industry and provide them with on-going,
in-house training on our broad range of service offerings. Building
communications managers are compensated with a base salary and a commission plan
structured to encourage increased building penetration and customer retention
within their assigned buildings. While many communications companies pay their
sales personnel a large, one-time percentage of a sales commission shortly after
a sale, our building communications managers receive a smaller up-front sales
commission but have the opportunity for larger commissions paid over the life of
the customer relationship. We anticipate that this commission structure will not
only forge stronger customer relationships but will also reduce turnover of our
building communications managers.

Organizational structure. A building communications manager will typically
be responsible for several buildings depending on the size of the building and
the building's market demographics. In larger markets, we will have a team of
four to six building communications managers led by a team leader, who will in
turn report to the sales director for a given market. In smaller markets, the
building communications manager will report directly to the sales director. The
sales director will report to the general manager for the particular market. The
general manager has full sales and marketing responsibility for the given
market.

Sales and marketing support. We support our building communications
managers with sales engineering and account administrative support. Our sales
engineers can provide additional technical sales support for data and enhanced
services as needed by our customers. In addition, we have a centralized
marketing team responsible for developing, promoting and branding our services.
The marketing team is also responsible for ensuring that our services remain
competitive with the marketplace by continually monitoring the competitive
landscape on a market-by-market basis. The team monitors changes in service
offerings, competition and price variations. We supplement our sales and
marketing operations through our web site located at www.onsiteaccess.com.

<PAGE>

OUR CUSTOMER CARE

We have established an organizational structure dedicated to being highly
responsive to customer needs and concerns.

Rapid and easy provisioning. Unlike other providers of voice and
bandwidth-enabled data services who rely on incumbent local telephone
companies to complete each customer installation, once we have installed
our in-building broadband network, we are able to independently provision
a new customer in that building on an average of five business days.

Network management. We monitor our network 24 hours a day, 365 days a
year, from our network operations center. Our network management system
permits us to identify and resolve network problems quickly. The network
operations center maintains visibility into each element of our network,
allowing us to provide reliable service and efficient customer
installation, as well as rapid response to customer inquiries. Currently,
all voice service network elements are monitored by our voice services
providers who have procedures in place to notify our network operations
center when there is a problem with a voice connection or network element.

Customer service hotline. We operate a toll-free customer service hotline
that operates 24 hours a day, 365 days a year, to address customer needs
and concerns. Our customer service representatives are equipped to handle
requests for all of our services and are capable of dispatching technical
assistance to a customer location 24 hours a day, 365 days a year.

Field support. We have field technicians in each market who are on call
24 hours a day, 365 days a year. These technicians provide on-premises
field installation, troubleshooting, equipment repair and other customer
support functions.

Billing and back-office support. We currently issue customers' bills on a
monthly basis with a single bill for all services. Our customer service
center handles billing inquiries. We are in the process of implementing a
new billing system from Daleen Technologies that will enable us to
continue to provide a single integrated bill for all services used by a
customer as well as provide discounts to purchasers of bundled services.
We also plan to offer a web-based billing interface for customer
convenience. In addition, we are selecting and implementing a new
operations support system which will increase the speed and efficiency of
our order provisioning and customer care.

COMPETITION

The market for voice and data services for small and medium-sized
businesses is extremely competitive. We face competition on price and quality of
service from traditional and new communications companies with longer operating
histories, more established customer relationships, greater financial, technical
and marketing resources, larger customer bases and greater brand or name
recognition than we have. These competitors include:

in-building competitors;

incumbent local telephone companies;

long distance companies; and

Internet, digital subscriber line and cable modem service providers.

Furthermore, the numerous companies that may seek to enter our niche may
expose us to severe price competition for our services or for securing building
access rights. Our competitors may also be able to respond more quickly to
technological developments and changes in customers' needs. Any of these factors
may limit our ability to compete effectively and could harm our business,
results of operations and ability to grow. See 'Risk Factors -- Risks Related to
Our Business -- The communications industry is highly competitive, and we may
not be able to compete effectively.'

<PAGE>

GOVERNMENT REGULATION

Telecommunications services, including local and long distance telephone
services, are subject to regulation at both the federal and state levels. The
FCC regulates interstate services, and state public utilities commissions
regulate intrastate communications services, including local service. The FCC
has preempted state regulation of, and does not directly regulate, enhanced
services involving more than pure transmission of customer-provided information,
including Internet access services.

We are in the process of applying for authority from various state
regulatory commissions to provide voice telephone service. To date, we have
received authorization from the FCC for international services, and from New
York, Connecticut, California and the District of Columbia for local and
in-state long distance services. We do not expect to encounter substantial legal
barriers to entry into regulated communications services. We also do not expect
to face regulatory restrictions on the pricing or terms of any regulated
communications service offerings we might choose to offer that would have a
material adverse effect on our business. Changes in the regulatory environment,
however, could lead to more intrusive regulation of our service offerings and
prices that could have a material adverse effect on our business.

Building access. Under current FCC regulations, commercial real estate
owners have the right to control wiring within their premises, beyond the
demarcation point at which telecommunications carriers terminate their
facilities. The demarcation point is typically at a minimum point of entry to
the building, such as the basement. In some older buildings, demarcation points
may be located in each tenant's office, but the real estate owner may demand
that the carrier establish a new demarcation point at the minimum point of
entry. These rules allow the real estate owner to install and maintain its own
inside wire, or to contract with companies such as us to maintain wiring on its
behalf.

Currently, there is no national legal requirement that owners or managers
of commercial office buildings give access to competitive providers of
communications services, but such laws and regulations have been adopted in
several states. For example, state laws in Connecticut and Texas generally
require commercial real estate owners to provide nondiscriminatory access to
communications carriers who have customers within a building, and limit what the
real estate owner may charge for such access. These laws require that such
carriers be permitted to install their own inside wiring, and there is no
requirement that real estate owners allow these carriers to use existing inside
wiring.

Nationwide laws and regulations concerning building access have been
proposed in the past and may be adopted in the future. On June 10, 1999, the FCC
announced it was considering adopting rules on a number of issues related to
riser access in multiple tenant environments, and requested comments on the
issues, including the following:

the FCC's tentative conclusion that utilities must allow communications
and cable service providers access to rooftop and other rights-of-way and
riser conduit in multiple tenant environments on just, reasonable and
nondiscriminatory rates, terms and conditions;

whether incumbent phone companies should make available unbundled access
to riser cable and wiring within multiple tenant environments; and

whether real estate owners offering access to any communications provider
should be required to make comparable access available to all such
providers on a nondiscriminatory basis, and whether the FCC has the
authority to impose such a requirement.

In addition, several bills have been introduced in the current session of the
U.S. Congress that cover similar issues relating to access to building roofs,
risers and other rights-of-way, although none of these bills has been brought to
a vote to date. We cannot predict the outcome of the FCC's proceeding or of any
legislation that may be enacted into law, nor what effect, if any, it may have
on our business.

Telecommunications Act of 1996. The Telecommunications Act eliminates many
of the pre-existing legal barriers to competition in communications businesses.
The Telecommunications Act also preempts many of the state barriers to local
telephone service competition that previously

<PAGE>

existed in state and local laws and regulations and sets basic standards for
relationships between communications providers.

The Telecommunications Act removes barriers to entry in the local exchange
telephone market by preempting state and local laws that restrict competition
and by requiring incumbent local telephone companies, including the Bell
operating companies divested by AT&T in 1984, to provide nondiscriminatory
access and interconnection to potential competitors, such as cable operators,
wireless communications providers, and long distance companies. In addition, the
Telecommunications Act provides relief from the earnings restrictions and price
controls that have governed the local telephone business for many years. The
Telecommunications Act will also, once certain thresholds are met, allow the
Bell operating companies to enter the long distance market within their own
local service regions.

Regulations promulgated by the FCC under the Telecommunications Act require
incumbent telephone companies to open their telephone networks to competition by
providing competitors interconnection, access to unbundled network elements and
collocation facilities within central offices. Although we currently do not
contract directly with such companies for these services, we purchase network
services from vendors who have exercised these rights and thereby can offer us
competitive prices.

Numerous parties appealed certain aspects of the FCC's regulations under
the Telecommunications Act, and implementation of several provisions of the
rules was delayed while the courts considered these appeals. On January 25,
1999, the Supreme Court issued an opinion confirming the FCC's authority to
issue regulations implementing the pricing and other provisions of the
Telecommunications Act and reinstating most of the challenged rules. However,
the Supreme Court vacated a key FCC rule identifying the network elements that
incumbent local telephone companies are required to unbundle. In response to the
Supreme Court's decision, the FCC revised its rules on November 5, 1999, largely
reaffirming and in some respects extending the obligation of incumbent local
telephone companies to offer elements of their networks to competitors at
cost-based rates. We expect that this decision will be subject to further court
proceedings. On December 9, 1999, the FCC ordered incumbent local telephone
companies to offer 'line sharing' arrangements that will permit competing
carriers to offer digital subscriber line services over the same copper loop
facilities used by the incumbent local telephone company to provide voice
telephone service. The prices for these arrangements will be determined by state
utility commissions. If these prices are set at low levels, it could allow our
competitors to offer low-cost alternatives to our services and put downward
pressure on our prices for Internet access and other data services. Future
regulatory proceedings and court appeals may create delay and uncertainty in
effectuating the interconnection and local competition provisions of the
Telecommunications Act, and could affect the availability and pricing of the
network services we purchase.

The Telecommunications Act establishes certain conditions before Bell
operating companies are allowed to offer long distance service to customers
within their local service regions. These conditions include 14 'checklist'
requirements designed to open the Bell operating company networks to
competitors. Bell Atlantic currently has an application pending before the FCC
for authority to offer long distance service in New York State, one of its most
important markets. Although, no Bell operating company has yet received FCC
authorization to provide in-region long distance service, it is possible that
the FCC may approve Bell Atlantic's pending application and/or future
applications by other companies. When this happens, we anticipate that the Bell
operating companies will intensify their efforts to compete against our service
offerings.

Other regulatory issues. The data services business, including Internet
access, is largely unregulated at this time apart from federal, state, and local
laws and regulations applicable to businesses in general. However, we cannot
assure you that this business will not become subject to regulatory restraints.
Some federal, state and local governments are considering a number of
legislative and regulatory proposals with respect to Internet user privacy,
infringement, pricing, quality of products and services and intellectual
property ownership. We are also unsure how existing laws will be applied to the
Internet in areas such as property ownership, copyright,

<PAGE>

trademark, trade secret, obscenity and defamation. Additionally, some
jurisdictions have sought to impose taxes and other burdens on providers of data
services, and to regulate content provided via the Internet and other
information services. We expect that proposals of this nature will continue to
be debated in Congress and state legislatures in the future. The adoption of new
laws or the adaptation of existing laws to the Internet may decrease the use of
the Internet, which could in turn have a material adverse effect on our Internet
business.

The wiring and other facilities we install in buildings are subject to
numerous local regulations such as building and electrical codes, licensing
requirements and construction requirements. These regulations vary on a
city-by-city and county-by-county basis. At present, we have no plans to own any
transmission facilities outside of the buildings we serve (such as fiber-optic
cables or radio links to other buildings), but if we decide to do so in the
future then we will have to comply with a variety of additional laws, rules, and
regulations governing access to public rights-of-way, in the case of cable
facilities, and FCC licensing of the radio spectrum, in the case of radio
facilities.

EMPLOYEES

To date, we have 176 full-time employees, excluding temporary personnel and
consultants. None of our employees are represented by a labor union, and we
generally consider relations with our employees to be good.

PROPERTIES

Our corporate headquarters consist of approximately 43,000 rentable square
feet located in New York City, which we occupy under a lease that expires in
July 2010. We maintain a network operations center at another location in New
York City while construction of our new network operations center is in progress
at our corporate headquarters. We also lease space for sales offices and network
equipment installations in a number of other locations throughout the United
States.

LEGAL PROCEEDINGS

We are not a party to any pending material legal proceedings.

<PAGE>

MANAGEMENT

DIRECTORS AND EXECUTIVE OFFICERS

The following table sets forth information regarding our executive officers
and directors.

<TABLE>
<CAPTION>
NAME AGE POSITION
- ---- --- --------
<S> <C> <C>
EXECUTIVE OFFICERS AND DIRECTORS
Howard E. Taylor......... 49 Chairman of the Board and Chief Executive Officer
Scott M. Jarus........... 43 President and Chief Operating Officer
Kenneth J. Hall.......... 41 Executive Vice President and Chief Financial Officer
Sharon K. Kelly.......... 50 Executive Vice President and Chief Marketing Officer
Richard J. Miller........ 41 Executive Vice President, Business Development
W. Montgomery Cerf....... 42 Director
Steven Foster............ 37 Director
Matthew Mochary.......... 31 Director
Jeffrey D. Neumann....... 37 Director
Scott H. Rechler......... 32 Director

OTHER SENIOR MANAGEMENT

Daren W. Hornig.......... 32 Executive Vice President, Market Development
Executive Vice President and Chief Technology
Brandon R. Knicely....... 37 Officer
Brian M. Benz............ 38 Senior Vice President, Finance
Waiman Lee............... 47 Vice President, Information Services
Louis E. Martinez........ 31 Vice President, Operations
Joan E. Mazzu............ 33 Vice President, National Market Development
Julianne Wilhelm......... 55 Vice President, Human Resources
</TABLE>

HOWARD E. TAYLOR has been our Chairman and Chief Executive Officer and a
director since July 1999. From September 1997 to July 1999, he was the President
and Chief Operating Officer of WinStar Broadband Services, a provider of
business-to-business telecommunications services. From November 1994 to
September 1997, Mr. Taylor served as the President of Custom Business Group for
Southern New England Telephone. From September 1990 to November 1994, he was the
Vice President, Marketing, Multinational Accounts for MCI Communications.

SCOTT M. JARUS has been our President and Chief Operating Officer since June
1998. Prior to joining our company, Mr. Jarus served as Senior Vice President of
Operations at RCN Telecom, a full-service communications provider to the
residential market, from August 1997 to June 1998. From December 1994 to May
1997, Mr. Jarus was co-founder and Vice President of Multimedia Medical Systems,
a provider of high-end multimedia applications to the healthcare industry. From
July 1985 to October 1994, Mr. Jarus served as Vice President of Operations and
in other senior management positions at Metromedia Communications Corporation, a
domestic and international carrier of voice and data services.

KENNETH J. HALL has been our Executive Vice President and Chief Financial
Officer since July 1999. From April 1997 to December 1998, Mr. Hall served as
Senior Vice President, Chief Financial Officer and Treasurer of Icon CMT Corp.,
an Internet service provider and web-centric consulting firm. In December 1998,
upon Qwest Communications International, Inc.'s acquisition of Icon, Mr. Hall
served as Senior Vice President of Finance and Operations and Chief Financial
Officer of Qwest Internet Solutions Inc., a wholly owned subsidiary of Qwest,
until April 1999. From February 1996 to March 1997, he was the Chief Financial
Officer of Global DirectMail Corp, an international direct marketer of computer
products and office supplies. Prior to such time, Mr. Hall was employed by
National Football League Properties, Inc. as Vice President of Finance and
Administration and Chief Financial Officer from 1992 to 1995 and Director of
Finance from 1990 to 1991. Mr. Hall's experience also includes management
positions with Price Waterhouse L.L.P. and Coopers and Lybrand L.L.C.

<PAGE>

SHARON K. KELLY has been our Executive Vice President and Chief Marketing
Officer since September 1999. From April 1998 to September 1999, Ms. Kelly was
Senior Vice President, Business Operations for WinStar Broadband Services. From
December 1994 to April 1998, Ms. Kelly was Vice President, Marketing & Data
Sales for Southern New England Telephone. Ms. Kelly was the Principal of Sharon
Kelly & Associates, a strategic sales and marketing consulting firm from October
1991 to December 1994. From July 1987 to September 1991, Ms. Kelly was Vice
President/Group Director for Citicorp/Quotron Systems in their information
services division.

RICHARD J. MILLER has been our Executive Vice President, Business Development
since June 1999. From April 1996 to June 1999, Mr. Miller was a Senior Vice
President at GE Equity, a division of GE Capital, which invested in the
Internet, healthcare, retail and broadcasting industries. From October 1994 to
March 1996, Mr. Miller was a principal in Avatar Capital Partners, a consulting
and investment company. From July 1988 to September 1994, Mr. Miller was a
general partner in RFE Investment Partners, a venture capital fund. Mr. Miller
has also served with Ernst & Young as a tax manager and is a certified public
accountant.

W. MONTGOMERY CERF has been a director since July 1999. He is a Managing
Director of J.P. Morgan Capital Corporation, a subsidiary of J.P. Morgan & Co.,
which he joined in 1983. Mr. Cerf also serves as a director of NewSouth
Communications and is a member of the valuation committee for TL Ventures, III
and IV.

STEVEN FOSTER has been a director since September 1999. Mr. Foster has been an
Associate Partner at Crosspoint Venture Partners since January 1998. From
November 1995 to January 1998, Mr. Foster was Director, Business Development at
3Com Corporation. From January 1992 to October 1995, Mr. Foster held a similar
position at Hewlett Packard.

MATTHEW MOCHARY has been a director since July 1999. He is a Partner at Spectrum
Equity Investors, which he joined in June 1996. Prior to this Mr. Mochary was a
Consultant at Bain & Company. Mr. Mochary is a director of ICNT
(InternetConnect), MimEcom Corporation, Apex Site Management and Nassau
Broadcasting.

JEFFREY D. NEUMANN has been a director since July 1999. He is Executive Vice
President and Chief Investment Officer of Reckson Service Industries, Inc.,
which he joined in March 1998. From April 1996 to February 1998, Mr. Neumann was
a vice president at GE Equity, a division of GE Capital. Previously, Mr. Neumann
was the President of a manufacturing company and of a healthcare company.
Mr. Neumann is also a director of VANTAS Incorporated, eSourceOne, Inc.,
CommerceInc Corporation and Realty Tracking Services, Inc.

SCOTT H. RECHLER has been a director since July 1999. He is the President, Chief
Executive Officer and a director of Reckson Service Industries, Inc.
Mr. Rechler is also the Co-Chief Executive Officer, President and a director of
Reckson Associates Realty Corp. Mr. Rechler has been employed at Reckson
Associates Realty Corp. since 1989. Mr. Rechler is also a director of VANTAS
Incorporated, eSourceOne, Inc and Keystone Property Trust.

DAREN W. HORNIG has been our Executive Vice President, Market Development since
January 1997. He was also a co-founder of our company. From May 1996 to December
1996, Mr. Hornig was Managing Director, Business Development for Globix
Corporation, an Internet service provider. From May 1994 to May 1996,
Mr. Hornig was Associate Director of Real Estate in the New York tri-state area
for Galbreath Company, a nationwide professional real estate concern. From March
1991 to May 1994, Mr. Hornig was an associate with Newmark & Company Real
Estate, Inc.

BRANDON R. KNICELY has been our Executive Vice President and Chief Technology
Officer since August 1997. From May 1994 to August 1997, Mr. Knicely was a
principal with Networked Systems & Consulting Group, a consulting firm focused
on the design and performance of large internetworks. From 1993 to 1994, he
worked as a Director of Youth and Media Programs for the Church of Christ. From
1985 to 1993, Mr. Knicely worked as a communications specialist in the Sales and
Marketing division of IBM Corporation.

BRIAN M. BENZ has been our Senior Vice President, Finance since July 1999. Prior
to that time, Mr. Benz was our Chief Financial Officer from January 1998 to July
1999. Mr. Benz was Chief Financial Officer, Secretary at Yoyodyne Entertainment,
an Internet promotions and direct marketing service from December 1996 to
December 1997. From January 1994 to December 1996,

<PAGE>

Mr. Benz was Chief Financial Officer, Secretary for Physicians' Online. Prior to
that time, Mr. Benz was an investment banker with Merrill Lynch Interfunding, a
leveraged buyout fund and an accountant with Touche Ross & Co. Mr. Benz is a
certified public accountant.

WAIMAN LEE has been our Vice President of Information Services since November
1999. Prior to joining our company, Mr. Lee served as Vice President of
Information Technology at RCN Telecom, from September 1997 to November 1999.
From April 1984 to August 1997, Mr. Lee served as Senior Director of Information
Technology and in other management positions within the Information Technology
department at MobileMedia Communications Corporation, a provider of paging and
wireless communications products and services.

LOUIS E. MARTINEZ has been our Vice President, Operations since June 1998. From
January 1996 to June 1998, Mr. Martinez was Director of Network Operations at
IDT Corporation, an international telecommunications company. From January 1995
to January 1996, Mr. Martinez was the Director, Corporate Internet Sales at IDT.
Prior to such time, Mr. Martinez was employed by B.C. Textiles as Operations
Manager from March 1993 to January 1995.

JOAN E. MAZZU has been our Vice President, National Market Development since
November 1999. She was our General Manager from May 1999 to October 1999.
Ms. Mazzu served as Vice President, General Manager at Kastle Systems, a
full-service provider of electronic security services to the national real
estate market from September 1994 to May 1999. From April 1992 to August 1994,
Ms. Mazzu was Vice President of Operations for Kastle Systems.

JULIANNE WILHELM has been our Vice President, Human Resources since May 1999.
From September 1994 to May 1999, Ms. Wilhelm was Vice President, Human Resources
of Starter Corporation, an athletic apparel company. In April 1999, Starter
Corporation filed a petition under Chapter 11 of the U.S. Bankruptcy Code with
the U.S. Bankruptcy Court in Wilmington, Delaware. Prior to that time, she was
an executive recruiter with Johnson Smith & Knisely from September 1993 to
September 1994. Prior to that time, Ms. Wilhelm was Vice President, Human
Resources at Medical Economics Company, a healthcare publishing company, from
May 1990 to May 1993.

BOARD OF DIRECTORS

Our board of directors is currently composed of six directors. We intend to
amend our certificate of incorporation to divide the board of directors into
three classes: Class I, whose terms will expire at the annual meeting of
stockholders to be held in 2001, Class II, whose terms will expire at the annual
meeting of stockholders to be held in 2002, and Class III, whose terms will
expire at the annual meeting of stockholders to be held in 2003. At each annual
meeting of stockholders beginning in 2001, the successors to directors whose
terms will then expire will be elected to serve from the time of election and
qualification until the third annual meeting following election.

In addition, our certificate of incorporation will provide that the
authorized number of directors may be changed only by resolution of the board of
directors. Any additional directorships resulting from an increase in the number
of directors will be distributed among the three classes so that, as nearly as
possible, each class will consist of one-third of the total number of directors.

COMMITTEES OF THE BOARD OF DIRECTORS

Our committees consist of an audit committee, a funding committee and a
compensation committee. The audit committee recommends the annual appointment of
our auditors with whom the audit committee reviews the scope of audit and
non-audit assignments and related fees, accounting principles we use in
financial reporting, internal auditing procedures and the adequacy of our
internal control procedures. The audit committee is composed of Messrs. Cerf,
Mochary and Neumann. The funding committee determines when all drawdowns under
financing arrangements will be made and recommends other financings to the board
of directors. The funding committee is composed of Messrs. Mochary, Neumann and
Taylor. The compensation committee reviews and approves the compensation and
benefits for our key executive officers, administers our employee

<PAGE>

benefit plans and makes recommendations to the board of directors regarding
grants of stock options and other incentive compensation arrangements. Our
compensation committee is composed of Messrs. Cerf, Foster and Taylor.

COMPENSATION OF DIRECTORS

Directors who are also our employees receive no additional compensation for
their services as directors. Directors who are not our employees will not
receive a fee for attendance in person at meetings of our board of directors or
committees of our board of directors, but they will be reimbursed for travel
expenses and other out-of-pocket costs incurred in connection with attending
meetings.

EXECUTIVE OFFICERS

Our board of directors appoints our executive officers. Our executive
officers serve at the discretion of our board of directors.

EMPLOYMENT, SEVERANCE AND NON-COMPETITION AGREEMENTS

In June 1999 we entered into letter agreements with Messrs. Taylor and
Miller, and in July, October and September 1999 we entered into employment
agreements with Messrs. Hall and Jarus, and Ms. Kelly, respectively. The
agreements provide for Mr. Taylor to serve as our Chief Executive Officer, Mr.
Jarus to serve as our President and Chief Operating Officer, Mr. Hall to serve
as our Executive Vice President and Chief Financial Officer, Ms. Kelly to serve
as our Executive Vice President and Chief Marketing Officer, and Mr. Miller to
serve as our Executive Vice President, Business Development at an annual base
salary of $355,000, $270,000, $260,000, $215,000 and $200,000, respectively.
Messrs. Taylor, Jarus, Hall and Miller, and Ms. Kelly are each eligible to
receive a bonus based upon a combination of their individual and our overall
performance.

To compensate Mr. Taylor for the possible forfeiture of certain options
held by him to acquire shares of WinStar Communications, an affiliate of his
former employer, we extended him a three year loan in the principal amount of $2
million. We will forgive one third of the loan on each the first three
anniversaries of Mr. Taylor's employment if he is then employed by us. Should we
terminate Mr. Taylor's employment without cause, the remaining balance of the
loan will be forgiven. If Mr. Taylor's WinStar stock options are not forfeited,
Mr. Taylor will repay the loan in an amount up to the net after tax proceeds he
would have retained had he exercised the options and sold the underlying stock
on the date they were otherwise scheduled to vest.

Pursuant to their agreements, Messrs. Taylor, Jarus, Hall and Miller, and
Ms. Kelly were granted options and related stock purchase rights for 2,000,000
shares, 750,000 shares, 650,000 shares, 445,000 shares, and 400,000 shares of
common stock, respectively, in each case, at an exercise price of $.45 per
share. All of these options have been exercised and in each case the stock
purchased vests over a four year period. One-eighth of Messrs. Taylor, Hall and
Miller and Ms. Kelly's shares received upon exercise vest six months after each
commenced his or her employment with us, and 1/48th of such shares will continue
to vest each month thereafter, provided that they are still employed by us.
One-eighth of Mr. Jarus' shares received upon exercise vested on December 8,
1998, and 1/48th of such shares vested and continue to vest each month
thereafter, provided that he is still employed by us.

If Messrs. Taylor's or Hall's employment is terminated without cause during
the first year of their employment, they will be entitled to severance equal to
one year of base salary, and in addition, Mr. Hall will also be eligible to
receive his applicable bonus. If Messrs. Taylor's or Hall's employment is
terminated without cause anytime thereafter, they will be entitled to severance
equal to six months of their base salary, and in addition, Mr. Hall will be
entitled to an amount equal to his bonus for the last fiscal year, six months of
additional vesting of restricted stock purchased by him upon exercise of his
options and up to one year of benefits. If Mr. Jarus' employment is terminated
without cause he is entitled to severance equal to six months of his base
salary, six months of additional vesting of restricted stock purchased by him
upon exercise of

<PAGE>

his options and up to six months of benefits. If Messrs. Taylor, Hall or Jarus
are terminated within one year of a change in control of our company, they will
be entitled to severance equal to two times their base salary and all of the
restricted stock purchased by them upon the exercise of their options will
immediately vest. In addition, Messrs. Jarus and Hall will be entitled to
receive an amount equal to two times their bonus for the last fiscal year and
one year of benefits.

EXECUTIVE COMPENSATION

The table below summarizes information concerning the compensation paid by
us during 1998 to our Chief Executive Officer and our other highly compensated
executive officers whose combined salary and bonus exceeded $100,000
(collectively, the 'named executive officers').

SUMMARY COMPENSATION TABLE

<TABLE>
<CAPTION>
ANNUAL COMPENSATION
------------------------ ALL OTHER
NAME AND PRINCIPAL POSITION YEAR SALARY($) BONUS($) COMPENSATION($)
- --------------------------- ---- --------- -------- ---------------
<S> <C> <C> <C> <C>
Howard E. Taylor
Chairman of the Board and Chief Executive
Officer...................................... 1998(1) -- -- --
Scott M. Jarus
President and Chief Operating Officer(2)..... 1998 $ 98,718 $14,000 --
Kenneth J. Hall
Executive Vice President and Chief Financial
Officer...................................... 1998(3) -- -- --
Sharon K. Kelly
Executive Vice President and Chief Marketing
Officer...................................... 1998(4) -- -- --
Richard J. Miller
Executive Vice President, Business
Development.................................. 1998(5) -- -- --
Daren W. Hornig
Executive Vice President, Market
Development.................................. 1998 $347,245(6) $29,000 $17,230(7)
Brandon R. Knicely
Executive Vice President and Chief Technology
Officer...................................... 1998 $129,326 $56,080 $10,000(8)
Brian M. Benz
Senior Vice President of Finance............. 1998 $150,000 $19,500 $ 5,000(9)
</TABLE>

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

(1) Mr. Taylor commenced his employment in July 1999.

(2) Mr. Jarus acted as our Chief Executive Officer in 1998.

(3) Mr. Hall commenced his employment in July 1999.

(4) Ms. Kelly commenced her employment in September 1999.

(5) Mr. Miller commenced his employment in June 1999.

(6) Includes $209,011 in commissions.

(7) Represents a reimbursement for legal costs incurred by Mr. Hornig in
connection with revisions to his employment agreement.

(8) Represents a reimbursement for legal costs incurred by Mr. Knicely in
connection with revisions to his employment agreement.

(9) Represents life insurance premiums paid by us.

<PAGE>

ONSITE ACCESS, INC. 1999 STOCK PLAN

We adopted the OnSite Access, Inc. 1999 Stock Plan on June 30, 1999. The
1999 Stock Plan provides for the granting of incentive stock options to our
employees and nonqualified stock options and stock purchase rights to our
employees, directors and consultants.

The following is a summary description of the 1999 Stock Plan. This summary
description is qualified in its entirety by the plan which is filed as an
exhibit to this registration statement, of which this prospectus is a part.

OVERVIEW

The 1999 Stock Plan provides our employees, directors and consultants with
an opportunity to purchase shares of our common stock. The purpose of the plan
is to attract and retain the best available personnel and to incentivize them to
promote the success of our business.

ADMINISTRATION

The 1999 Stock Plan will be administered by the administrator, which will
be either the board of directors or a committee appointed by the board.

Generally, the administrator (1) will select those persons to whom options
and stock purchase rights will be granted, and (2) will determine the terms and
conditions of options and stock purchase rights, including the purchase price
per share and the vesting provisions.

ELIGIBLE INDIVIDUALS

Any of our current or future employees, directors or consultants will be
eligible to participate in the 1999 Stock Plan.

SHARES SUBJECT TO 1999 STOCK PLAN

The maximum number of shares available for the granting of options and
stock purchase rights under the 1999 Stock Plan is 9,489,897. If an option or
stock purchase right expires, is surrendered pursuant to an option exchange
program, or is otherwise terminated without having been exercised in full, the
shares allocated to the expired, surrendered or otherwise terminated option or
stock purchase rights may again become available for grant or sale under the
plan.

Options will be designated as either incentive stock options, or ISOs,
which are intended to qualify for special tax treatment, or nonqualified stock
options. The per share exercise price of any option or stock purchase right will
be fixed by the administrator at the time the option is granted. The per share
exercise price of any ISO will not be less than 100% of the fair market value on
the date the option is granted or 110% in the case of an option granted to a 10%
stockholder. Each option is exercisable at such dates and in such installments
as determined by the administrator. Each option will be for a term determined by
the administrator.

Options and stock purchase rights will not be transferable except by will
or the laws of descent or distribution.

The purchase price for shares acquired pursuant to the exercise of an
option must be paid in full concurrently with the exercise of an option. The
purchase price may be paid in cash, or as otherwise determined by the
administrator.

In the event of a merger of our company with or into another corporation,
or the sale of substantially all of our assets, each outstanding option and
stock purchase right shall be assumed or an equivalent option substituted by the
successor corporation or a parent or subsidiary of the successor corporation. In
the event that the successor corporation refuses to or otherwise does not assume
or substitute for the option or stock purchase right, the optionee shall have
the right to exercise the option or stock purchase right as to all of the shares
subject to the option, including shares as to which it would not otherwise be
exercisable.

<PAGE>

If an option or stock purchase right becomes fully vested and exercisable
in lieu of assumption or substitution in the event of a merger or sale of our
assets, the administrator shall notify the optionee in writing or electronically
that the option or stock purchase right shall be fully exercisable for a period
of 15 days from the date of such notice, and that the option or stock purchase
right shall terminate upon the exercise of such period. For the purposes of this
paragraph, the option or stock purchase right shall be considered assumed if,
following the merger or sale of assets, the option or right confers the right to
purchase or receive, for each share subject to the option or stock purchase
right immediately prior to the merger or sale of assets, the consideration
(whether stock, cash, or other securities or property) received in the merger or
sale of such assets by holders of common stock for each share held on the
effective date of the transaction (and, if holders were offered a choice of
consideration, the type of consideration chosen by the holders of a majority of
the outstanding shares).

STOCK PURCHASE RIGHTS

A stock purchase right allows a grantee to purchase shares which are
subject to a vesting schedule after purchase. A restricted stock purchase
agreement grants the company the right to repurchase the unvested shares upon
the voluntary or involuntary termination of the purchaser's service with the
company for any reason (including death or disability).

TERMINATION OF EMPLOYMENT

Each option agreement will set forth the terms and conditions applicable to
the option upon termination of the optionee's employment. In the absence of a
specified time in the option agreement, the option shall remain exercisable for
three (3) months following the optionee's termination. If the optionee does not
exercise his or her option in the specified time, the option shall terminate.

INCOME TAX WITHHOLDING

When an optionee recognizes taxable income in connection with the receipt
of shares under the 1999 Stock Plan, the optionee must pay us an amount equal to
the federal, state and local income taxes and other amounts as may be required
by law to be withheld by us prior to the issuance of shares. If permitted by the
administrator in satisfaction of the obligation to pay withholding taxes, the
optionee may elect to have withheld a portion of the shares then issuable to him
or her having an aggregate fair market value equal to the withholding taxes.

ADJUSTMENT UPON CHANGE IN CAPITALIZATION

In the event of a change in capitalization, the administrator will adjust
the maximum number and class of shares or other stock or securities with respect
to which options or stock purchase rights may be granted under the 1999 Stock
Plan to any eligible individual in any calendar year and the number and class of
shares or other stock or securities which are subject to outstanding options or
stock purchase rights and the purchase price covered by each outstanding option
or stock purchase right.

EFFECT OF LIQUIDATION

In the event of our proposed liquidation or dissolution, the administrator
shall notify each optionee as soon as practicable prior to the effective date of
the proposed transaction. The administrator in its discretion may provide for an
optionee to have the right to exercise his or her option or stock purchase right
until 15 days prior to the transaction as to all of the shares covered by the
option or stock purchase right, including shares which would not otherwise be
exercisable. In addition, the administrator may provide that any company
repurchase option applicable to any shares purchased upon exercise of an option
or stock purchase right shall lapse as to all shares, provided the proposed
dissolution or liquidation takes place at the time and in the manner

<PAGE>

contemplated. To the extent it has not been previously exercised, an option or
stock purchase right will terminate immediately prior to the consummation of
such proposed action.

MULTIPLE AGREEMENTS

The terms of any option under the 1999 Stock Plan will be set forth in an
agreement between us and the optionee.

AMENDMENT AND TERMINATION

The 1999 Stock Plan terminates on the tenth anniversary of its adoption.
The board may at any time and from time to time amend, alter, suspend or
terminate the plan. However, no such amendment, alteration, suspension or
termination may adversely alter any outstanding options without the consent of
the optionee. In addition, amendments may require stockholder approval.

FEDERAL INCOME TAX CONSEQUENCES APPLICABLE TO THE 1999 STOCK PLAN

In general, an optionee will not recognize taxable income upon the grant or
exercise of an ISO and we will not be entitled to any business expense
deduction. However, upon the exercise of an ISO, the excess of the fair market
value on the date of exercise of the shares received over the exercise price of
the option will be treated as an adjustment to alternative minimum taxable
income (unless the shares are sold in the same taxable year as exercise). In
order for the exercise of an ISO to qualify as an ISO, an optionee generally
must be an employee of Onsite or a subsidiary from the date the ISO is granted
through the date three months before the date of exercise or one year preceding
the date of exercise in the case of an optionee whose employment is terminated
due to disability. The employment requirement does not apply where an optionee's
employment is terminated upon death.

If an optionee holds the shares acquired upon exercise of an ISO for more
than two years after the date of grant and for more than one year after the date
of exercise, then upon disposition of the shares, the difference, if any,
between the sales price of the shares and the exercise price of the option will
be treated as long-term capital gain or loss. If an optionee disposes of the
shares acquired upon exercise of an ISO prior to satisfying these holding period
requirements, the optionee will recognize ordinary income at the time of
disposition, generally in an amount equal to the excess of the fair market value
of the shares at the time of exercise over the exercise price of the option. The
balance of any gain realized will be short-term or long-term capital gain. If
the optionee sells the shares prior to satisfying the holding period
requirements at a price below fair market value at the time the option was
exercised, the amount of ordinary income will be limited to the amount realized
on the sale over the exercise price of the option. In general, if we comply with
applicable income reporting requirements, we will be allowed a business expense
deduction to the extent an optionee recognizes ordinary income. If the optionee
disposes of the shares at a loss, the loss will be a capital loss.

In general, an optionee who receives a nonqualified stock option will not
recognize income at the time of the grant of the option. Upon exercise of a
nonqualified stock option, an optionee will recognize ordinary income in an
amount equal to the excess of the fair market value of the shares on the date of
exercise over the exercise price of the option. The basis in the shares acquired
upon exercise of a nonqualified stock option will equal the fair market value of
such shares at the time of exercise. The holding period of the shares for
capital gain purposes will begin on the date of exercise. In general, if we
comply with applicable income reporting requirements, we will be entitled to a
business expense deduction in the same amount as the optionee recognizes
ordinary income. In the event of a sale of the shares received upon the exercise
of a nonqualified stock option, any appreciation or depreciation after the
exercise date generally is taxed as capital gain or loss. However, any gain will
be subject to reduced tax rates if the shares were held for more than twelve
months.

In the absence of a Section 83(b) election (as described below), a grantee
who receives restricted stock upon exercise of a stock purchase right will
recognize no income at that time.

<PAGE>

When the restrictions expire, a grantee will recognize ordinary income (treated
as compensation) equal to the fair market value of the shares when the
restrictions expire over the amount paid (if any) for the restricted stock. If
the restrictions applicable to a grant of restricted stock expire over time (for
example, if the restrictions on 20% of a grant expire on specified anniversaries
of the date of grant), the grantee will include the fair market value of the
portion of the shares as to which the restrictions expire as ordinary income
(treated as compensation) as the restrictions expire. The grantee's basis in the
shares is equal to the amount included in income on the expiration of the
restrictions plus the amount paid, and the capital gains holding period begins
when the restrictions end. Any subsequent disposition of the shares will be
taxed as capital gain or loss, provided that any gain will be subject to reduced
rates of tax if the shares are held for more than 12 months. Dividends received
by the grantee in respect of shares of restricted stock constitute ordinary
income (treated as compensation) in the year received. In general, if we comply
with the applicable income reporting requirements, we will be entitled to a
business expense deduction equal to the amount of the shares when they are
included in the grantee's income, and we will also be entitled to a business
expense deduction (in the year paid) for dividends paid to the grantee in
respect of shares of restricted stock.

If a Section 83(b) election is made within 30 days of the initial grant of
restricted stock upon the exercise of a stock purchase right, the grantee must
include the fair market value of the shares on the date of grant, less the
amount paid for the shares, as ordinary income (treated as compensation) as of
the date of grant and the capital gains holding period begins at the time
issued. In general, if we comply with the applicable income reporting
requirements, we will be entitled to a corresponding business expense deduction
equal to the fair market value of the shares included in the grantee's income,
but dividends on the shares would not be deductible. Any subsequent disposition
of the shares by the grantee, other than by forfeiture, will be taxed as capital
gain or loss, provided that any gain will be subject to reduced rates of tax if
the shares are held for more than 12 months. No deduction is permitted to a
grantee who has made the Section 83(b) election and who subsequently forfeits
the restricted stock, other than a capital loss for the amount (if any) a
grantee paid for the restricted stock, over the amount realized (if any) upon
such forfeiture, and such loss will be treated as a short term or long term
capital loss. In that case, we would be required to include as ordinary income
the amount of deduction we claimed with respect to the restricted stock.

This discussion assumes that at the time of exercise, the sale of the
shares would not subject an optionee to liability under Section 16(b) of the
Exchange Act. Special rules may apply with respect to persons who may be subject
to Section 16(b). Optionees who are or may become subject to Section 16(b)
should consult with their own advisors.

EXCISE TAXES

Under certain circumstances, the accelerated vesting or exercise of options
or expiration of restrictions on restricted stock in connection with a change in
control of our company may be deemed an 'excess parachute payment' for purposes
of the golden parachute tax provisions of Section 280G of the Internal Revenue
Code. To the extent it is so considered, the grantee may be subject to a 20%
excise tax on the excess parachute payment and we may be denied a tax deduction
with respect to the excess parachute payment.

<PAGE>

CERTAIN TRANSACTIONS

REORGANIZATION, RECAPITALIZATION AND RELATED TRANSACTIONS

Our predecessor company was Veritech Ventures, LLC, a New York limited
liability company formed in July 1996. In November 1997, Veritech Ventures
contributed substantially all of its assets and liabilities to OnSite Ventures,
L.L.C., a Delaware limited liability company. In June 1999, we completed a
reorganization and recapitalization transaction in which OnSite Ventures merged
into our company. As a result of the merger, all of the membership interests in
OnSite Ventures were converted into shares of our common stock.

DEBT AGREEMENTS

In February 1998, we issued a 12% convertible subordinated promissory note
for $6.5 million to an affiliate of Reckson Service Industries. In connection
with our reorganization and recapitalization, this note was converted into
5,869,000 shares of Series A preferred stock.

In February 1999, we issued a 15% senior secured promissory note for $3.0
million to both JAH Realties and an affiliate of Reckson Service Industries.

In April 1999, we issued promissory notes for an aggregate principal amount
of $20.0 million to our private equity investors. With a portion of the proceeds
from the $20.0 million in promissory notes, we repaid the 15% senior secured
promissory note for $3.0 million issued to both JAH Realties and an affiliate of
Reckson Service Industries.

PREFERRED STOCK PURCHASE AGREEMENT

As part of our reorganization and recapitalization, we entered into a
preferred stock purchase agreement with our private equity investors. Pursuant
to this agreement, we have issued an aggregate of 75,461,745 shares of
Series B, Series C and Series D preferred stock for an aggregate consideration
of $60.0 million. We issued a portion of the preferred stock to our private
equity investors in exchange for the cancellation of the $20.0 million in
promissory notes, plus accrued and unpaid interest of approximately $500,000.

SUBSCRIPTION AGREEMENT

In July 1999, pursuant to a subscription agreement we issued shares of
common stock to stockholders, including 323,128 shares to an affiliate of
Reckson Service Industries, for consideration of $145,408.

INVESTOR RIGHTS AGREEMENT

The parties to the preferred stock purchase agreement and some of our
officers also entered into an investor rights agreement in April 1999, which
provides, among other things, that the preferred stockholders have rights to
participate in registration statements filed by us for the sale of our common
stock in an underwritten offering for our own account, subject to the ability of
the underwriters to limit the number of shares included in the registration and
giving priority to the issuance of shares held by us. The existence and exercise
of these registration rights may make it more difficult for us to arrange future
financings and may have an adverse effect on the market price of our common
stock.

VOTING AGREEMENT

The parties to the preferred stock purchase agreement also entered into a
voting agreement in April 1999, which provides, among other things, that:

Spectrum Equity Investors III, L.P., J.P. Morgan Investment Corporation
and Crosspoint Venture Partners may each nominate one member to our board
of directors;

an affiliate of Reckson Service Industries may nominate two members to our
board of directors;

<PAGE>

all of the parties to the voting agreement shall vote their shares in
favor of each other's nominees;

all of the parties to the voting agreement shall vote their shares of
common stock and preferred stock to elect our chief executive officer to
our board of directors; and

one of our founders who is an affiliate of a stockholder may attend all
meetings of our board of directors and committees and will be provided
with any materials that we provide to our board.

The voting agreement will terminate upon the closing of this offering.

RELATIONSHIPS WITH A STOCKHOLDER AND ITS AFFILIATES

From January 1, 1998 to September 30, 1999, we had communications services
agreements with affiliates of Reckson Service Industries to offer communications
services to tenants in their buildings. Under these agreements, we have paid a
total of $39,000 to these entities from January 1, 1998 to September 30, 1999.

From January 1, 1998 to September 30, 1999, we provided communications
services to affiliates of Reckson Service Industries. Revenues from these
entities totaled $580,000 during this period.

From January 1, 1998 to September 30, 1999, we paid affiliates of Reckson
Service Industries $58,000 for leased office space.

Scott Rechler, one of our directors, is the President, Chief Executive
Officer and a director of Reckson Service Industries.

We believe that these transactions are based on market terms and
conditions.

RELATIONSHIPS WITH ONE OF OUR PRINCIPAL UNDERWRITERS

In April 1999, as part of our reorganization and recapitalization, we
entered into a preferred stock purchase agreement pursuant to which we issued
shares of preferred stock to a group of private equity investors including
affiliates of J.P. Morgan & Co., which is a representative of the underwriters.
Under this agreement, we issued an aggregate of 13,205,805 shares of Series B, C
and D preferred stock to these affiliates of J.P. Morgan & Co. in exchange for
$10.5 million, a portion of which was paid in the form of cancellation of $3.5
million in indebtedness, including accrued and unpaid interest, issued in
connection with this agreement. The collective percentage ownership interest of
these entitles is % of our common stock. Each of the transactions with the
affiliates of J.P. Morgan & Co. has been approved by our board of directors and
was completed on substantially the same terms as with several other unaffiliated
third parties participating in the same transactions.

RELATIONSHIPS WITH MANAGEMENT AND EXECUTIVE OFFICERS

We have entered into employment offer letters and restricted stock purchase
agreements with some of our officers. See 'Management -- Employment, Severance
and Non-competition Agreements' and 'Management -- OnSite Access, Inc. 1999
Stock Plan.' In connection with the exercise of their options, we extended loans
on a full recourse basis to Messrs. Taylor, Jarus, Hall and Miller and Ms.
Kelly, in the principal amounts of $898,000, $336,750, $291,850, $199,805 and
$179,600, respectively. In addition, to compensate Mr. Taylor for the possible
forfeiture of certain options held by him to acquire shares of WinStar
Communications, an affiliate of his former employer, we extended him a three
year loan in the principal amount of $2 million which is forgiven in equal
installments annually.

<PAGE>

PRINCIPAL STOCKHOLDERS

The following table sets forth certain information regarding the beneficial
ownership of common stock as of December 13, 1999 and as adjusted to reflect the
sale of the common stock offered hereby by:

each person (or group within the meaning of Section 13(d)(3) of the
Securities Exchange Act of 1934) known by us to own beneficially 5% or
more of the common stock;

our directors and named executive officers; and

all our directors and executive officers as a group.

As used in this table, 'beneficial ownership' means the sole or shared
power to vote or direct the voting or to dispose or direct the disposition of
any security. A person is deemed to be the beneficial owner of securities that
can be acquired within 60 days from the date of this prospectus through the
exercise of any option, warrant or right. Shares of common stock subject to
options, warrants or rights that are currently exercisable or exercisable within
60 days are deemed outstanding for computing the ownership percentage of the
person holding such options, warrants or rights, but are not deemed outstanding
for computing the ownership percentage of any other person. The amounts and
percentages are based upon 41,808,365 shares of common stock outstanding as of
December 13, 1999, assuming the conversion of all outstanding preferred stock
except for the Series B preferred stock, and shares of common stock outstanding
as of the completion of this offering.

The address for each executive officer is c/o OnSite Access, Inc., 1372
Broadway, New York, New York 10018.

NUMBER OF SHARES OF
COMMON STOCK
BENEFICIALLY OWNED PERCENTAGE OWNED
PRIOR TO ---------------------------------
NAME AND AFTER OFFERING(1) PRIOR TO OFFERING AFTER OFFERING
---- --------------------- ----------------- --------------
<S> <C> <C> <C>
Reckson Service Industries, Inc.(2)............ 15,150,104 36.2% %
10 East 50th Street
New York, New York 10022

Spectrum Equity Investors III, L.P.(3). ....... 6,323,000 15.1
245 Lytton Avenue, Suite 175
Palo Alto, California 94301

Crosspoint Venture Partners(4) ................ 4,455,806 10.7
2925 Woodside Road
Woodside, California 94062

J.P. Morgan Investment Corporation(5) ......... 4,455,805 10.7
60 Wall Street
New York, New York 10260-0060

Jeffrey D. Neumann(6) ......................... 15,250,104 36.5
10 East 50th Street
New York, New York 10022

Scott H. Rechler(7) ........................... 15,240,104 36.5
10 East 50th Street
New York, New York 10022

Matthew Mochary(8) ............................ 6,323,000 15.1
245 Lytton Avenue, Suite 175
Palo Alto, California 94301

Steven Foster(9) .............................. 4,455,806 10.7
2925 Woodside Road
Woodside, California 94062

W. Montgomery Cerf(10) ........................ 4,455,805 10.7
60 Wall Street
New York, New York 10260-0060

Howard E. Taylor............................... 2,000,000 4.8

Daren W. Hornig(11)............................ 815,284 2.0
</TABLE>

(table continued on next page)

<PAGE>

(table continued from previous page)

<TABLE>
<CAPTION>
NUMBER OF SHARES OF
COMMON STOCK
BENEFICIALLY OWNED PERCENTAGE OWNED
PRIOR TO ----------------------------------
NAME AND AFTER OFFERING(1) PRIOR TO OFFERING AFTER OFFERING
---- --------------------- ----------------- --------------
<S> <C> <C> <C>

Scott M. Jarus................................. 750,000 1.8

Kenneth J. Hall................................ 650,000 1.6

Richard J. Miller.............................. 445,000 1.1

Sharon M. Kelly................................ 400,000 1.0

Brandon R. Knicely............................. 275,000 *

Brian M. Benz.................................. 225,000 *
All directors and executive officers as a group
(14 persons)(12)............................. 36,300,999 86.8
</TABLE>

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

* Represents beneficial ownership of less than one percent.

(1) Assumes conversion of all outstanding shares of preferred stock, except for
shares of Series B preferred stock which will convert automatically at the
initial public offering price.

(2) Consists of 8,466,396 shares held by RSI-OSA Holdings, Inc. and 6,683,708
shares held by RSI-OnSite Holdings LLC. Does not include 13,125,000 shares
of Series B preferred stock held by RSI-OnSite Holdings LLC.

(3) Does not include 12,416,667 shares of Series B preferred stock held by
Spectrum Equity Investors III, L.P.

(4) Does not include 8,750,000 shares of Series B preferred stock held by
Crosspoint Venture Partners.

(5) Consists of 3,564,644 shares held by J.P. Morgan Investment Corporation and
891,161 shares held by Sixty Wall Street SBIC Fund, L.P. Does not include
7,000,000 shares of Series B preferred stock held by J.P. Morgan Investment
Corporation or 1,750,000 shares of Series B preferred stock held by Sixty
Wall Street SBIC Fund, L.P.

(6) Consists of (a) 100,000 shares held by Mr. Neumann, (b) 8,466,396 shares
that Mr. Neumann may be deemed to beneficially own because he is an officer
of Reckson Service Industries, Inc., the sole member of RSI-OnSite Holdings
LLC, as to which Mr. Neumann disclaims beneficial ownership and
(c) 6,683,708 shares that Mr. Neumann may be deemed to beneficially own as
an officer of RSI-OnSite Holdings, Inc., a wholly owned subsidiary of
Reckson Service Industries, Inc., as to which Mr. Neumann disclaims
beneficial ownership. Does not include 13,125,000 shares of Series B
preferred stock held by RSI-OnSite Holdings LLC.

(7) Consists of (a) 90,000 shares held by Mr. Rechler, (b) 8,466,396 shares
that Mr. Rechler may be deemed to beneficially own because he is an
officer, director and stockholder of Reckson Service Industries, Inc., the
sole member of RSI-OnSite Holdings LLC, as to which Mr. Rechler disclaims
beneficial ownership and (c) 6,683,708 shares that Mr. Rechler may be
deemed to beneficially own as an officer of RSI-OnSite Holdings, Inc., a
wholly owned subsidiary of Reckson Service Industries, Inc., as to which
Mr. Rechler disclaims beneficial ownership. Does not include 13,125,000
shares of Series B preferred stock held by RSI-OnSite Holdings LLC.

(8) Consists of 6,323,000 shares that Mr. Mochary may be deemed to beneficially
own because he is a limited partner of Spectrum Equity Associates III,
L.P., the general partner of Spectrum Equity Investors III, L.P., as to
which Mr. Mochary disclaims beneficial ownership. Does not include
12,416,667 shares of Series B preferred stock held by Spectrum Equity
Investors III, L.P.

(9) Consists of 4,455,806 shares that Mr. Foster may be deemed to beneficially
own because he is a partner of Crosspoint Venture Partners, as to which Mr.
Foster disclaims beneficial ownership. Does not include 8,750,000 shares of
Series B preferred stock held by Crosspoint Venture Partners.
(footnotes continued on next page)

<PAGE>

(footnotes continued from previous page)

(10) Consists of (a) 3,564,644 shares that Mr. Cerf may be deemed to
beneficially own because he is a managing director of J.P. Morgan
Investment Corporation, as to which Mr. Cerf disclaims beneficial ownership
and (b) 891,161 shares that Mr. Cerf may be deemed to beneficially own
because he is a managing director of Sixty Wall Street SBIC Corporation,
the general partner of Sixty Wall Street SBIC Fund, L.P., as to which Mr.
Cerf disclaims beneficial ownership. Does not include 7,000,000 shares of
Series B preferred stock held by J.P. Morgan Investment Corporation or the
1,750,000 shares of Series B preferred stock held by Sixty Wall Street SBIC
Fund, L.P.
(11) Consists of (a) 735,284 shares held directly by Mr. Hornig and (b) 80,000
shares that Mr. Hornig may be deemed to beneficially own because such
shares are held by members of his immediately family, as to which Mr.
Hornig disclaims beneficial ownership.
(12) Includes shares that our directors may be deemed to beneficially own
because of their relationships with our private equity investors, as to
which they disclaim beneficial ownership. Excludes shares of Series B
preferred stock held by our private equity investors.

<PAGE>

DESCRIPTION OF CAPITAL STOCK

We intend to amend our certificate of incorporation and bylaws prior to the
completion of this offering. The forms of our certificate of incorporation and
bylaws will be filed as exhibits to the registration statement of which this
prospectus is a part. The following summarizes the terms and provisions of our
capital stock upon the closing of this offering. The summary is not complete,
and you should read the forms of our certificate of incorporation and bylaws.

Upon the closing of this offering, our authorized capital stock will
consist of million shares, par value $0.001 per share, of common stock and
million shares, par value $0.001 per share, of preferred stock.

COMMON STOCK

Each share of our common stock will be identical in all respects and will
entitle its holder to the same rights and privileges enjoyed by all other holder
of shares of common stock and will subject them to the same qualifications,
limitations and restrictions to which all other holders of common stock will be
subject.

VOTING RIGHTS

Holders of our common stock will be entitled to one vote per share on all
matters to be voted on by our stockholders. Holders of common stock will not
have cumulative rights, so that holders of a plurality of the shares of common
stock present at a meeting at which a quorum is present will be able to elect
all of our directors eligible for election in a given year. The holders of a
majority of the voting power of the issued and outstanding common stock will
constitute a quorum.

DIVIDENDS

Holders of our common stock will be entitled to receive ratably such
dividends, if any, as are declared by our board of directors out of funds
legally available for the declaration of dividends, subject to the preferential
rights of any holder of preferred stock that may from time to time be
outstanding.

LIQUIDATION

Upon our liquidation, dissolution or winding up, the holders of our common
stock will be entitled to share pro rata in the distribution of all of our
assets available for distribution after satisfaction of all of our liabilities
and the payment of the liquidation preference of any preferred stock that may be
outstanding.

OTHER PROVISIONS

The holders of our common stock will have no preemptive or other
subscription rights to purchase common stock, and there will be no redemptive
rights or sinking fund provisions.

PREFERRED STOCK

Our board of directors will be authorized to issue preferred stock in one
or more series and to establish the number of shares to be included in each
series and to fix the designations, powers, preferences and rights of the shares
of each series and any qualifications, limitations or restrictions of each
series. Because the board of directors will have the power to establish the
preferences and rights of the shares of any series of preferred stock, it may
afford the holders of any series of preferred stock preferences, powers and
rights, including voting rights, senior to the rights of the holders of common
stock. The issuance of preferred stock may have the effect of delaying,
deferring or preventing a change in control of our company.

<PAGE>

WARRANTS

In November and December 1999, we agreed to issue to real estate owners and
agents warrants to acquire shares of our common stock. The warrants have an
exercise price of $2.36 per warrant share and are typically exercisable for a
period of five years, at any time following the earlier of six months after our
initial public offering or 12 months from the date of the warrant agreement. The
warrants vest upon the holders meeting certain performance obligations as
outlined in the warrant agreements.

LIMITATION ON DIRECTORS' LIABILITIES

Our certificate of incorporation will limit the liability of our directors
to us and our stockholders to the fullest extent permitted by Delaware law.
Specifically, our directors will not be personally liable for money damages for
breach of fiduciary duty as a director, except for liability

for any breach of the director's duty of loyalty to us or our
stockholders;

for acts or omissions not in good faith or which involve intentional
misconduct or a knowing violation of law;

under Section 174 of the Delaware General Corporation Law, which concerns
unlawful payments of dividends, stock purchases or redemptions; and

for any transaction from which the director derived an improper personal
benefit.

ANTI-TAKEOVER EFFECTS OF OUR CERTIFICATE OF INCORPORATION AND BYLAWS AND
PROVISIONS OF DELAWARE LAW

Our certificate of incorporation, bylaws and Section 203 of the Delaware
General Corporation Law contain provisions that may make the acquisition of
control of our company by means of a tender offer, open market purchase, proxy
fight or otherwise, more difficult.

SECTION 203 OF THE DELAWARE GENERAL CORPORATION LAW

We must comply with the provisions of Section 203 of the Delaware General
Corporation Law. In general, Section 203 prohibits a publicly held Delaware
corporation from engaging in a 'business combination' with an 'interested
stockholder' for a period of three years after the date of the transaction in
which the person became an interested stockholder, unless the business
combination is approved in a prescribed manner.

A 'business combination' includes a merger, asset sale or other transaction
resulting in a financial benefit to the interested stockholder. An 'interested
stockholder' is a person who, together with affiliates and associates, owns, or,
in some cases, within three years prior, did own, 15% or more of the
corporation's voting stock. Under Section 203, a business combination between
OnSite and an interested stockholder is prohibited unless it satisfies one of
the following three conditions:

our board of directors must have previously approved either the business
combination or the transaction that resulted in the stockholder becoming
an interested stockholder;

upon consummation of the transaction that resulted in the stockholder
becoming an interested stockholder, the interested stockholder owned at
least 85% of our voting stock outstanding at the time the transaction
commenced, excluding, for purposes of determining the number of shares
outstanding, shares owned by (1) persons who are directors and also
officers and (2) employee stock plans, in some instances; and

the business combination is approved by our board of directors and
authorized at an annual or special meeting of the stockholders by the
affirmative vote of the holders of at least 66 2/3% of the outstanding
voting stock that is not owned by the interested stockholder.

<PAGE>

STAGGERED BOARD

Our certificate of incorporation will provide that the number of directors
shall be fixed from time to time by a resolution of our board of directors. Our
certificate of incorporation will also provide that the board of directors shall
be divided into three classes. The members of each class of directors will serve
for staggered three-year terms. As permitted by the Delaware General Corporation
Law, the members of our classified board of directors will be removable from
office only by our stockholders for cause. Vacancies on the board of directors
shall be filled by a majority of the remaining directors, or by a sole remaining
director, or by our stockholders if the vacancy was caused by the action of our
stockholders.

ADVANCE NOTICE PROVISION

Our certificate of incorporation and bylaws will provide that stockholders
must follow an advance notification procedure to nominate candidates for the
board of directors and to propose business to be conducted at an annual meeting.

SPECIAL MEETINGS OF STOCKHOLDERS; WRITTEN CONSENT PROVISION

Our certificate of incorporation will provide that special meetings of our
stockholders may be called only by the board of directors, the chairman of the
board or the president. Our certificate of incorporation will also remove our
stockholders' ability to act by written consent. These provisions may render it
more difficult for stockholders to take action opposed by the board of
directors.

ADOPTION, AMENDMENT OR REPEAL OF BYLAWS

Our certificate of incorporation will limit the ability of our stockholders
to adopt, amend or repeal our bylaws. Specifically, any adoption, amendment or
repeal of a bylaw by our stockholders will require passage by a supermajority
vote.

SUPERMAJORITY APPROVALS

The provisions of our certificate of incorporation referred to above will
not be able to be altered without supermajority approval by our stockholders.

TRANSFER AGENT AND REGISTRAR

The transfer agent and registrar for our common stock is .

<PAGE>

SHARES ELIGIBLE FOR FUTURE SALE

Upon completion of this offering, shares of common stock will be
outstanding, or shares if the underwriters exercise their
over-allotment option in full. Of these shares, the shares of common stock,
assuming the underwriters exercise their over-allotment option in full, sold in
this offering will be freely tradeable without restriction or further
registration under the Securities Act, unless held by an 'affiliate' of our
company as that term is defined in Rule 144 under the Securities Act. All of the
shares of common stock outstanding prior to this offering are 'restricted
securities,' as defined under Rule 144. These shares are restricted securities
because they were issued in private transactions not involving a public offering
and may not be sold in the absence of registration other than in accordance with
Rule 144 or Rule 701 promulgated under the Securities Act or another exemption
from registration. This prospectus may not be used in connection with any resale
of shares of common stock acquired in this offering by our affiliates.

In general, under Rule 144 as currently in effect, if a minimum of one year
has elapsed since the later of the date of acquisition of the restricted
securities from the issuer or from an affiliate of the issuer, a person (or
persons whose shares of common stock are aggregated), including persons who may
be deemed our affiliates, would be entitled to sell within any three-month
period a number of shares of common stock that does not exceed the greater of

(1) one percent of the then-outstanding shares of common stock, which
equals approximately shares immediately after this offering, or

(2) the average weekly trading volume during the four calendar weeks
preceding the date on which notice of the sale is filed with the SEC.

Sales under Rule 144 are also subject to specified restrictions as to the
manner of sale, notice requirements and the availability of current public
information about us. In addition, under Rule 144(k), if a period of at least
two years has elapsed since the later of the date restricted securities were
acquired from us or the date they were acquired from one of our affiliates, a
stockholder who is not our affiliate at the time of sale and who has not been
our affiliate for at least three months prior to the sale would be entitled to
sell shares of common stock in the public market immediately without compliance
with the foregoing requirements under Rule 144. Rule 144 does not require the
same person to have held the securities for the applicable periods. The
foregoing summary of Rule 144 is not intended to be a complete description
thereof.

In addition, any employee, director or officer of, or consultant to our
company who acquired shares pursuant to a written compensatory plan or contract
may be entitled to rely on the resale provisions of Rule 701 of the Securities
Act, which permits non-affiliates to sell their Rule 701 shares without having
to comply with the public information, holding period, volume limitation or
notice provisions of Rule 144, and permits our affiliates to sell their Rule 701
shares without having to comply with the holding period restrictions of Rule
144, in each case, commencing 90 days after the date of this prospectus.

Immediately following this offering, none of the 'restricted securities'
will be available for immediate sale in the public market pursuant to Rule
144(k). Beginning 90 days after the date of this prospectus, and without
consideration of the contractual restrictions described above, shares
issued under or acquired upon exercise of options issued under the 1999 Stock
Plan will be outstanding and eligible for sale in reliance upon Rule 701.
Additional shares may be available if options are exercised in the 180-day
period following the date of this prospectus. Shares of common stock issued
pursuant to the 1999 Stock Plan generally will be available for sale in the open
market by holders who are not our affiliates and, subject to the volume and
other applicable limitations of Rule 144, by holders who are our affiliates,
unless those shares are subject to vesting restrictions or the contractual
restrictions described above.

<PAGE>

Warrants to purchase shares of common stock will also be outstanding after
the completion of this offering. Holders of warrants have the right, subject to
certain conditions and limitations, to include their shares in various
registration statements relating to our securities. By exercising their
registration rights and causing a large number of shares to be registered and
sold in the public market, these holders may cause the price of our common stock
to fall. In addition, their participation in our registration statements could
have an adverse effect on our ability to raise needed capital.

Prior to this offering, there has been no public market for the common
stock. No information is currently available and we cannot predict the timing or
amount of future sales of shares, or the effect, if any, that future sales of
shares, or the availability of shares for future sale, will have on the market
price of the common stock prevailing from time to time. Sales of substantial
amounts of the common stock (including shares issuable upon the exercise of
stock options or warrants) in the public market after the lapse of the
restrictions described above, or the perception that such sales may occur, could
materially adversely affect the prevailing market prices for the common stock
and our ability to raise equity capital in the future. See 'Risk
Factors -- Risks Related to this Offering -- The sale or availability for sale
of substantial amounts of our common stock could adversely affect our stock
price.'

REGISTRATION RIGHTS

Some holders of our common stock are entitled to registration rights, which
are described under 'Certain Transactions -- Reorganization, Recapitalization
and Related Transactions -- Investor rights agreement.'

<PAGE>

UNITED STATES TAX CONSEQUENCES TO NON-UNITED STATES HOLDERS

The following is a general discussion of the principal United States
federal income and estate tax consequences of the ownership and disposition of
our common stock by a Non-U.S. Holder. As used in this prospectus, the term
'Non-U.S. Holder' is a person who holds our common stock other than:

a citizen or individual resident of the United States,

a corporation or partnership created or organized in or under the laws of
the United States or of any political subdivision of the United States,
other than a partnership treated as foreign under U.S. Treasury
regulations,

an estate whose income is includable in gross income for U.S. federal
income tax purposes regardless of its source, or

a trust, in general, if it is subject to the primary supervision of a
court within the U.S. and the control of one or more U.S. persons.

An individual may, subject to certain exceptions, be treated as a resident
of the U.S. for U.S. federal income tax purposes, instead of a nonresident, by,
among other things, being present in the United States for at least 31 days in
the calendar year and for an aggregate of at least 183 days during a three-year
period ending in the current calendar year -- counting for these purposes all
of the days present in the current year, one-third of the days present in the
immediately preceding year and one-sixth of the days present in the second
preceding year. Residents are subject to U.S. federal tax as if they were U.S.
citizens.

This discussion does not consider:

U.S. state and local or non-U.S. tax consequences,

specific facts and circumstances that may be relevant to a particular
Non-U.S. Holder's tax position, including, if our common stock is held by
a U.S. partnership, the U.S. tax consequences of holding and disposing of
our common stock may be affected by certain determinations made at the
partner level,

the tax consequences for the stockholders, partners or beneficiaries of a
Non-U.S. Holder,

special tax rules that may apply to certain Non-U.S. Holders, including
without limitation, banks, insurance companies, dealers in securities and
traders in securities, or

special tax rules that may apply to a Non-U.S. Holder that holds our
common stock as part of a 'straddle,' 'hedge' or 'conversion transaction.'

The following discussion is based on provisions of the U.S. Internal
Revenue Code of 1986, as amended, applicable Treasury regulations and
administrative and judicial interpretations, all as of the date of this
prospectus, and all of which are subject to change, retroactively or
prospectively. The following summary is for general information. ACCORDINGLY,
EACH NON-U.S. HOLDER SHOULD CONSULT A TAX ADVISOR REGARDING THE UNITED STATES
FEDERAL, STATE, LOCAL AND NON-U.S. INCOME AND OTHER TAX CONSEQUENCES OF
ACQUIRING, HOLDING AND DISPOSING OF SHARES OF OUR COMMON STOCK.

DIVIDENDS

We do not anticipate paying cash dividends on our common stock in the
foreseeable future. See 'Dividend Policy.' In the event, however, that dividends
are paid on shares of common stock, dividends paid to a Non-U.S. Holder of
common stock generally will be subject to withholding of United States federal
income tax at a 30% rate, or such lower rate as may be provided by an applicable
income tax treaty. Non-U.S. Holders should consult their tax advisors regarding
their entitlement to benefits under a relevant income tax treaty.

Dividends that are effectively connected with a Non-U.S. Holder's conduct
of a trade or business in the United States or, if an income tax treaty applies,
attributable to a permanent establishment in the United States ('U.S. trade or
business income'), are generally subject to U.S. federal income tax on a net
income basis at regular graduated rates, but are not generally subject

<PAGE>

to the 30% withholding tax if the Non-U.S. Holder files the appropriate U.S.
Internal Revenue Service form with the payor. Any U.S. trade or business income
received by a Non-U.S. Holder that is a corporation may also, under certain
circumstances, be subject to an additional 'branch profits tax' at a 30% rate or
such lower rate as specified by an applicable income tax treaty.

Dividends paid prior to 2001 to an address in a foreign country are
presumed, absent actual knowledge to the contrary, to be paid to a resident of
such country for purposes of the withholding discussed above and for purposes of
determining the applicability of a tax treaty rate. For dividends paid after
2000:

a Non-U.S. Holder of common stock who claims the benefit of an applicable
income tax treaty rate generally will be required to satisfy applicable
certification and other requirements,

in the case of common stock held by a foreign partnership, the
certification requirement will generally be applied to the partners of the
partnership and the partnership will be required to provide certain
information, including a United States taxpayer identification number, and

look-through rules will apply for tiered partnerships.

A Non-U.S. Holder of common stock that is eligible for a reduced rate of
U.S. withholding tax under an income tax treaty may obtain a refund or credit of
any excess amounts withheld by filing an appropriate claim for a refund with the
U.S. Internal Revenue Service.

GAIN ON DISPOSITION OF COMMON STOCK

A Non-U.S. Holder generally will not be subject to U.S. federal income tax
in respect of gain recognized on a disposition of common stock unless:

the gain is U.S. trade or business income, in which case, the branch
profits tax described above may also apply to a corporate Non-U.S. Holder,

the Non-U.S. Holder is an individual who holds the common stock as a
capital asset within the meaning of Section 1221 of the U.S. Internal
Revenue Code, is present in the United States for more than 182 days in
the taxable year of the disposition and meets certain other requirements,

the Non-U.S. Holder is subject to tax pursuant to the provisions of the
U.S. tax law applicable to certain United States expatriates, or

we are or have been a 'U.S. real property holding corporation' for federal
income tax purposes at any time during the shorter of the five-year period
ending on the date of disposition or the period that the Non-U.S. Holder
held the common stock.

Generally, a corporation is a 'U.S. real property holding corporation' if
the fair market value of its 'U.S. real property interests' equals or exceeds
50% of the sum of the fair market value of its worldwide real property interests
plus its other assets used or held for use in a trade or business. We have not
determined whether we are a 'U.S. real property holding corporation.' There is a
possibility that we are, or will become, such a corporation. Even if we are or
were to become a 'U.S. real property holding corporation,' the tax relating to
stock in a 'U.S. real property holding corporation' will not apply to a Non-U.S.
Holder whose holdings, direct and indirect, at all times during the applicable
period, constituted 5% or less of the common stock, provided that the common
stock was regularly traded on an established securities market.

FEDERAL ESTATE TAX

Common stock owned or treated as owned by an individual who is a Non-U.S.
Holder at the time of death will be included in the individual's gross estate
for United States federal estate tax purposes, unless an applicable estate tax
or other treaty provides otherwise and, therefore, may be subject to United
States federal estate tax.

<PAGE>

INFORMATION REPORTING AND BACKUP WITHHOLDING TAX

We must report annually to the U.S. Internal Revenue Service and to each
Non-U.S. Holder the amount of dividends paid to that holder and the tax withheld
with respect to those dividends. Copies of the information returns reporting
those dividends and withholding may also be made available to the tax
authorities in the country in which the Non-U.S. Holder is a resident under the
provisions of an applicable income tax treaty or agreement.

Under certain circumstances, U.S. Treasury Regulations require information
reporting and backup withholding at a rate of 31% on certain payments on common
stock. Under currently applicable law, Non-U.S. Holders of common stock
generally will be exempt from these information reporting requirements and from
backup withholding on dividends paid prior to 2001 to an address outside the
U.S. For dividends paid after 2000, however, a Non-U.S. Holder of common stock
that fails to certify its Non-U.S. Holder status in accordance with applicable
U.S. Treasury Regulations may be subject to backup withholding at a rate of
31% on payments of dividends.

The payment of the proceeds of the disposition of common stock by a holder
to or through the U.S. office of a broker or through a non-U.S. branch of a U.S.
broker generally will be subject to information reporting and backup withholding
at a rate of 31% unless the holder either certifies its status as a Non-U.S.
Holder under penalties of perjury or otherwise establishes an exemption. The
payment of the proceeds of the disposition by a Non-U.S. Holder of common stock
to or through a non-U.S. office of a non-U.S. broker will not be subject to
backup withholding or information reporting unless the non-U.S. broker is a
'U.S. related person.' In the case of the payment of proceeds from the
disposition of common stock by or through a non-U.S. office of a broker that is
a U.S. person or a 'U.S. related person,' information reporting, but currently
not backup withholding, on the payment applies unless the broker receives a
statement from the owner, signed under penalty of perjury, certifying its
non-U.S. status or the broker has documentary evidence in its files that the
holder is a Non-U.S. Holder and the broker has no actual knowledge to the
contrary. For this purpose, a 'U.S. related person' is:

a 'controlled foreign corporation' for U.S. federal income tax purposes,

a foreign person 50% or more of whose gross income from all sources for
the three-year period ending with the close of its taxable year preceding
the payment, or for such part of the period that the broker has been in
existence, is derived from activities that are effectively connected with
the conduct of a U.S. trade or business, or

effective after 2000, a foreign partnership if, at any time during the
taxable year, (A) at least 50% of the capital or profits interest in the
partnership is owned by U.S. persons, or (B) the partnership is engaged in
a U.S. trade or business.

Effective after 2000, backup withholding may apply to the payment of
disposition proceeds by or through a non-U.S. office of a broker that is a U.S.
person or a 'U.S. related person' unless certain certification requirements are
satisfied or an exemption is otherwise established and the broker has no actual
knowledge that the holder is a U.S. person. Non-U.S. Holders should consult
their own tax advisors regarding the application of the information reporting
and backup withholding rules to them, including changes to these rules that will
become effective after 2000.

Any amounts withheld under the backup withholding rules from a payment to a
Non-U.S. Holder will be refunded, or credited against the holder's U.S. federal
income tax liability, if any, provided that the required information is
furnished to the U.S. Internal Revenue Service.

<PAGE>

UNDERWRITING

Subject to the terms and conditions stated in the underwriting agreement
dated the date of this prospectus, each underwriter named below has severally
agreed to purchase, and we have agreed to sell to each underwriter, the number
of shares set forth opposite the name of each underwriter.

<TABLE>
<CAPTION>
UNDERWRITER NUMBER OF SHARES
- ----------- ----------------
<S> <C>
Salomon Smith Barney Inc....................................
J.P. Morgan Securities Inc..................................
CIBC World Markets Corp.....................................
Thomas Weisel Partners LLC..................................
----------

Total..................................................
----------
----------
</TABLE>

The underwriting agreement provides that the obligations of the several
underwriters to purchase the shares included in this offering are subject to
approval of various legal matters by counsel and to certain other conditions,
such as , and . The underwriters are obligated to purchase all
the shares (other than those covered by the over-allotment option described
below) if they purchase any of the shares.

The underwriters, for whom Salomon Smith Barney Inc., J.P. Morgan
Securities Inc., CIBC World Markets Corp. and Thomas Weisel Partners LLC are
acting as representatives, propose to offer some of the shares directly to the
public at the public offering price listed on the cover page of this prospectus
and some of the shares to various dealers at the public offering price less a
concession not in excess of $ per share. The underwriters may allow, and
these dealers may reallow, a concession not in excess of $ per share on
sales to other dealers. If all of the shares are not sold at the initial
offering price, the representatives may change the public offering price and the
other selling terms. The representatives have advised us that the underwriters
do not intend to confirm any sales to any accounts over which they exercise
discretionary authority.

We have granted to the underwriters a 30-day option to purchase up to
additional shares of common stock at the public offering price less the
underwriting discount. The underwriters may exercise their option solely for the
purpose of covering over-allotments, if any, in connection with this offering.
To the extent this option is exercised, each underwriter will be obligated,
subject to various conditions, to purchase a number of additional shares
approximately proportionate to its initial purchase commitment.

At our request, the underwriters will reserve up to approximately
shares of common stock to be sold, at the initial public offering price, to our
directors, officers and employees, and their friends and family members. This
directed share program will be administered by Salomon Smith Barney Inc. The
number of shares of common stock available for sale to the general public will
be reduced to the extent these individuals purchase reserved shares. Any
reserved shares which are not so purchased will be offered by the underwriters
to the general public on the same basis as the other shares offered hereby.

Prior to this offering, there has been no public market for the common
stock. Consequently, the initial public offering price for the shares was
determined by negotiations between us and the representatives. Among the factors
considered in determining the initial public offering price were our records of
operations, our current financial condition, our future prospects, our markets,
the economic conditions in and future prospects for the industry in which we
compete, our

<PAGE>

management, and currently prevailing general conditions in the equity securities
markets, including current market valuations of publicly traded companies
considered comparable to our company. We cannot assure you, however, that the
price at which the shares will sell in the public market after this offering
will not be lower than the price at which they are sold by the underwriters or
that an active trading market in the common stock will develop and continue
after this offering.

We will apply to have our common stock included for quotation on the Nasdaq
National Market under the symbol 'OSAX'.

The following table shows the underwriting discounts and commissions to be
paid to the underwriters by us in connection with this offering. These amounts
are shown assuming both no exercise and full exercise of the underwriters'
option to purchase additional shares of common stock to cover over-allotments.

<TABLE>
<CAPTION>
PAID BY US
---------------------------
NO EXERCISE FULL EXERCISE
----------- -------------
<S> <C> <C>
Per share.................................................. $ $
Total................................................. $ $
</TABLE>

In connection with this offering, Salomon Smith Barney Inc., on behalf of
the underwriters, may over-allot, or engage in syndicate covering transactions,
stabilizing transactions and penalty bids. Over-allotment involves syndicate
sales of common stock in excess of the number of shares to be purchased by the
underwriters in this offering, which creates a syndicated short position.
Syndicate covering transactions involve purchases of the common stock in the
open market after the distribution has been completed in order to cover
syndicate short positions. Stabilizing transactions consist of bids or purchases
of common stock made for the purpose of preventing or retarding a decline in the
market price of the common stock while the offering is in progress. Penalty bids
permit the underwriters to reclaim a selling concession from a syndicate member
when Salomon Smith Barney Inc., in covering syndicate short positions or making
stabilizing purchases, repurchases shares originally sold by that syndicate
member. These activities may cause the price of the common stock to be higher
than the price that otherwise would exist in the open market in the absence of
these transactions. These transactions may be effected on the Nasdaq National
Market or in the over-the-counter market, or otherwise and, if commenced, may be
discontinued at any time.

We estimate that the total expenses, excluding underwriting discounts and
commissions, of this offering will be $ .

Thomas Weisel Partners LLC, one of the representatives of the underwriters,
was organized and registered as a broker-dealer in December 1998. Since December
1998, Thomas Weisel Partners has been named as a lead or co-manager on 98 filed
public offerings of equity securities, of which 78 have been completed, and has
acted as a syndicate member in an additional 53 public offerings of equity
securities. Thomas Weisel Partners does not have any material relationship with
us or any of our officers, directors or other controlling persons, except with
respect to its contractual relationship with us pursuant to the underwriting
agreement that will be entered into in connection with this offering.

Because entities controlled by J.P. Morgan & Co. beneficially own more than
10% of the preferred stock outstanding prior to the closing of this offering,
J.P. Morgan & Co. may be deemed to have a 'conflict of interest' with us under
Rule 2720 of the Conduct Rules of the National Association of Securities
Dealers. When a NASD member with a 'conflict of interest' participates as an
underwriter in a public offering, Rule 2720 states that the public offering
price per share can be no higher than that recommended by a 'qualified
independent underwriter' meeting specified standards. In accordance with this
rule, Salomon Smith Barney Inc. has assumed the responsibilities of acting as a
qualified independent underwriter. In its role as a qualified independent
underwriter, Salomon Smith Barney Inc. has performed a due diligence
investigation and participated in the preparation of this prospectus and the
registration statement of which this prospectus is a part.

<PAGE>

We have agreed to indemnify the underwriters against various liabilities,
including liabilities under the Securities Act of 1933, or to contribute to
payments the underwriters may be required to make in respect of any of those
liabilities.

LEGAL MATTERS

Fried, Frank, Harris, Shriver & Jacobson (a partnership including
professional corporations), New York, New York, will pass upon the validity of
the issuance of the shares of common stock offered hereby. Cravath, Swaine &
Moore, New York, New York, will pass upon certain legal matters in connection
with this offering for the underwriters.

EXPERTS

Ernst & Young LLP, independent auditors, have audited our consolidated
financial statements and schedule at December 31, 1997 and 1998 and for the
period from July 5, 1996 (date of inception) to December 31, 1996 and the years
ended December 31, 1997 and 1998, as set forth in their reports. We have
included our financial statements and schedule in the prospectus and elsewhere
in the registration statement in reliance on Ernst & Young LLP's reports, given
on their authority as experts in accounting and auditing.

WHERE YOU CAN FIND MORE INFORMATION

We have filed with the SEC a registration statement on Form S-1 with
respect to the common stock being offered by this prospectus. This prospectus
does not contain all of the information set forth in the registration statement
and the exhibits and schedules to the registration statement. For further
information with respect to us and the shares of common stock offered by this
prospectus, you should refer to the registration statement, including its
exhibits and schedules. Statements made in this prospectus as to any contract or
other document are not necessarily complete and you should refer to the exhibits
attached to the registration statement for copies of the actual contract or
document. You may review a copy of the registration statement, including its
exhibits and schedules, at the SEC's public reference room, located at 450 Fifth
Street, N.W., Washington, D.C. 20549, or at the SEC's regional offices located
at 500 West Madison Street, Suite 1400, Chicago, IL 60661, and Seven World Trade
Center, 13th Floor, New York, NY 10048 or on the Internet at http://www.sec.gov.
You may obtain a copy of this registration statement from the SEC's public
reference room upon payment of prescribed fees. Please call the SEC at
(800) SEC-0330.

As a result of this offering, we will become subject to the information and
reporting requirements of the Exchange Act and, in accordance therewith, will
file periodic reports, proxy statements and other information with the SEC.

<PAGE>

INDEX TO CONSOLIDATED FINANCIAL STATEMENTS

<TABLE>
<CAPTION>
<S> <C>
Report of Independent Auditors. F-2
Consolidated Balance Sheets................................. F-3
Consolidated Statements of Operations....................... F-4
Consolidated Statements of Stockholders' (Deficit) Equity... F-5
Consolidated Statements of Cash Flows....................... F-6
Notes to Consolidated Financial Statements.................. F-7
</TABLE>

F-1

<PAGE>

REPORT OF INDEPENDENT AUDITORS

To the Board of Directors of
ONSITE ACCESS, INC.

We have audited the accompanying consolidated balance sheets of OnSite Access,
Inc. (formerly OnSite Ventures LLC and Veritech Ventures LLC) (the 'Company') as
of December 31, 1997 and 1998, and the related consolidated statements of
operations, stockholders' (deficit) equity and cash flows for the period from
July 5, 1996 (date of inception) to December 31, 1996 and for the years ended
December 31, 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, the consolidated financial statements referred to above present
fairly, in all material respects, the financial position of OnSite Access, Inc.
(formerly OnSite Ventures LLC and Veritech Ventures LLC) at December 31, 1997
and 1998, and the consolidated results of its operations and its cash flows for
the period from July 5, 1996 (date of inception) to December 31, 1996 and for
the years ended December 31, 1997 and 1998 and in conformity with generally
accepted accounting principles.

/s/ ERNST & YOUNG LLP

New York, New York
November 5, 1999

F-2

<PAGE>

ONSITE ACCESS, INC.
CONSOLIDATED BALANCE SHEETS

<TABLE>
<CAPTION>
DECEMBER 31,
------------------------- SEPTEMBER 30,
1997 1998 1999
----------- ----------- -------------
(UNAUDITED)
<S> <C> <C> <C>
ASSETS
Current assets:
Cash............................................. $ 121,830 $ 921,545 $ 18,575,036
Accounts receivable, net of allowance for
doubtful accounts of $0, $68,831 and $217,007,
respectively................................... 13,725 374,066 901,126
Other current assets............................. 44,073 25,691 239,465
----------- ----------- ------------
Total current assets.................................. 179,628 1,321,302 19,715,627

Property and equipment, net........................... 568,451 2,233,364 14,852,214
Deferred financing costs, net......................... -- 326,839 --
Other assets.......................................... 158,326 342,199 2,653,667
----------- ----------- ------------
Total assets.......................................... $ 906,405 $ 4,223,704 $ 37,221,508
----------- ----------- ------------
----------- ----------- ------------
LIABILITIES AND STOCKHOLDERS'
EQUITY (DEFICIT)
Current liabilities:
Accounts payable................................. $ 228,901 $ 971,090 $ 1,457,682
Accrued expenses................................. 78,721 414,164 3,470,225
Current portion of capital lease obligations..... 50,945 201,205 240,701
----------- ----------- ------------
Total current liabilities............................. 358,567 1,586,459 5,168,608

Deferred rent......................................... 40,175 40,332 129,259
Capital lease obligations less current portion........ 118,782 361,724 2,487,337
Loan payable to stockholder, including accrued
interest of $2,778, $343,870 and $0, respectively... 327,778 6,738,870 --
Other liabilities..................................... -- 43,888 38,148

Redeemable preferred stock:
Series B -- redeemable -- par $.001: 50,000,000
shares authorized; 33,749,773 issued and
outstanding.................................... -- -- 33,532,701
Series C -- redeemable and convertible -- par
$.001: 25,069,634 shares authorized; 16,921,890
issued and outstanding......................... -- -- 6,603,261
Series D -- redeemable and convertible -- par
$.001: 392,111 shares authorized; 264,674
issued and outstanding......................... -- -- 103,280
----------- ----------- ------------
Total redeemable preferred stock................. -- -- 40,239,242

Stockholders' equity (deficit):
Series A preferred stock -- par $.001:
convertible -- 5,869,000 shares authorized,
issued and outstanding......................... -- -- 7,098,923
Common stock -- par $.001; 75,000,000 shares
authorized; 9,813,620 issued and outstanding... -- -- 9,814
Additional paid-in capital....................... -- -- 28,085,526
Members' equity.................................. 1,242,707 1,562,069 --
Stockholders loans for restricted stock.......... -- -- (2,262,066)
Deferred equity consideration.................... -- -- (19,492,796)
Accumulated deficit.............................. (1,181,604) (6,109,638) (24,280,487)
----------- ----------- ------------
Total stockholders' equity (deficit).................. 61,103 (4,547,569) (10,841,086)
----------- ----------- ------------
Total liabilities and stockholders' equity
(deficit)........................................... $ 906,405 $ 4,223,704 $ 37,221,508
----------- ----------- ------------
----------- ----------- ------------
</TABLE>

See accompanying notes.

F-3

<PAGE>

ONSITE ACCESS, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS

Other income (expense):
Interest expense........ -- (2,833) (380,914) (207,403) (1,063,423)
Interest income......... -- 843 5,925 4,799 71,011
Preferred return and
other, net............ (3,000) (61,970) (18,668) (18,668) --
-------- ----------- ----------- ----------- ------------
Total other income
(expense).................. (3,000) (63,960) (393,657) (221,272) (992,412)

Net loss before income
taxes...................... (61,420) (1,120,184) (4,928,034) (3,374,496) (17,337,173)
Provision for income taxes... -- -- -- -- --
-------- ----------- ----------- ----------- ------------
Net loss..................... (61,420) (1,120,184) (4,928,034) (3,374,496) (17,337,173)
Accreted dividends on
preferred stock............ -- -- -- -- (833,676)
-------- ----------- ----------- ----------- ------------
Net loss applicable to common
stockholders............... $(61,420) $(1,120,184) $(4,928,034) $(3,374,496) $(18,170,849)
-------- ----------- ----------- ----------- ------------
-------- ----------- ----------- ----------- ------------
Net loss per common share.... $ (0.02) $ (0.33) $ (1.19) $ (1.09) $ (4.06)
-------- ----------- ----------- ----------- ------------
-------- ----------- ----------- ----------- ------------
Weighted average number of
shares outstanding -- basic
and diluted................ 3,339,500 3,439,714 4,156,836 3,105,081 4,479,112
---------- ----------- ----------- ----------- ------------
---------- ----------- ----------- ----------- ------------
</TABLE>

See accompanying notes.

F-4

<PAGE>

ONSITE ACCESS, INC.
CONSOLIDATED STATEMENTS OF STOCKHOLDERS' (DEFICIT) EQUITY
PERIOD FROM JULY 5, 1996 (DATE OF INCEPTION) TO
DECEMBER 31, 1996, AND YEARS ENDED DECEMBER 31, 1997, AND 1998
AND NINE MONTHS ENDED SEPTEMBER 30, 1999 (UNAUDITED)
<TABLE>
<CAPTION>
COMMON STOCK PREFERRED STOCK DEFERRED ADDITIONAL
MEMBERS' ------------------ ----------------------- STOCKHOLDER EQUITY PAID-IN
EQUITY SHARES AMOUNT SHARES AMOUNT LOANS CONSIDERATION CAPITAL
----------- --------- ------ --------- ----------- ----------- ------------- -----------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Capital
contributed........ $ 72,739 -- $ -- -- $ -- $ -- $ -- $ --
Preferred return..... 3,000 -- -- -- -- -- -- --
Net loss for the
period from July 5,
1996 (date of
inception) to
December 31,
1996............... -- -- -- -- -- -- -- --
----------- --------- ------ --------- ----------- ----------- ------------ -----------
Balance as of
December 31,
1996............... 75,739 -- -- -- -- -- --
Capital
contributed........ 1,041,356 -- -- -- -- -- -- --
Non-cash equity
consideration...... 63,642 -- -- -- -- -- -- --
Preferred return..... 61,970 -- -- -- -- -- -- --
Net loss for the year
ended December 31,
1997............... -- -- -- -- -- -- -- --
----------- --------- ------ --------- ----------- ----------- ------------ -----------
Balance as of
December 31,
1997............... 1,242,707 -- -- -- -- -- -- --
Return of capital.... (306,806) -- -- -- -- -- -- --
Capital
contributed........ 105,000 -- -- -- -- -- -- --
Non-cash equity
consideration...... 502,500 -- -- -- -- -- -- --
Preferred return..... 18,668 -- -- -- -- -- -- --
Net loss for the year
ended December 31,
1998............... -- -- -- -- -- -- -- --
----------- --------- ------ --------- ----------- ----------- ------------ -----------
Balance as of
December 31,
1998............... 1,562,069 -- -- -- -- -- -- --
Effect of
incorporation...... (1,562,069) 5,050,223 5,051 5,869,000 7,098,923 -- -- 1,651,734
Issuance of stock
options and
restricted stock... -- -- -- -- -- -- (24,176,489) 24,176,489
Stockholder loans for
restricted stock... -- 4,763,397 4,763 -- -- (2,262,066) -- 2,257,303
Amortization of
non-cash equity
consideration...... -- -- -- -- -- -- 4,683,693 --
Net loss for the nine
months ended
September 30,
1999............... -- -- -- -- -- -- -- --
Accreted dividends on
preferred stock.... -- -- -- -- -- -- -- --
----------- --------- ------ --------- ----------- ----------- ------------ -----------
Balance as of
September 30,
1999............... $ -- 9,813,620 $9,814 5,869,000 $ 7,098,923 $(2,262,066) $(19,492,796) $28,085,526
----------- --------- ------ --------- ----------- ----------- ------------ -----------
----------- --------- ------ --------- ----------- ----------- ------------ -----------

ACCUMULATED
DEFICIT TOTAL
------------ ------------
<S> <C> <C>
Capital
contributed........ $ -- $ 72,739
Preferred return..... -- 3,000
Net loss for the
period from July 5,
1996 (date of
inception) to
December 31,
1996............... (61,420) (61,420)
------------ ------------
Balance as of
December 31,
1996............... (61,420) 14,319
Capital
contributed........ -- 1,041,356
Non-cash equity
consideration...... -- 63,642
Preferred return..... -- 61,970
Net loss for the year
ended December 31,
1997............... (1,120,184) (1,120,184)
------------ ------------
Balance as of
December 31,
1997............... (1,181,604) 61,103
Return of capital.... -- (306,806)
Capital
contributed........ -- 105,000
Non-cash equity
consideration...... -- 502,500
Preferred return..... -- 18,668
Net loss for the year
ended December 31,
1998............... (4,928,034) (4,928,034)
------------ ------------
Balance as of
December 31,
1998............... (6,109,638) (4,547,569)
Effect of
incorporation...... -- 7,193,639
Issuance of stock
options and
restricted stock... -- --
Stockholder loans for
restricted stock... -- --
Amortization of
non-cash equity
consideration...... -- 4,683,693
Net loss for the nine
months ended
September 30,
1999............... (17,337,173) (17,337,173)
Accreted dividends on
preferred stock.... (833,676) (833,676)
------------ ------------
Balance as of
September 30,
1999............... $(24,280,487) $(10,841,086)
------------ ------------
------------ ------------
</TABLE>

See accompanying notes.

F-5

<PAGE>

ONSITE ACCESS, INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS

<TABLE>
<CAPTION>
PERIOD FROM
JULY 5, 1996
(DATE OF NINE MONTHS
INCEPTION) TO YEAR ENDED DECEMBER 31, ENDED SEPTEMBER 30,
DECEMBER 31, ------------------------- --------------------------
1996 1997 1998 1998 1999
------------- ----------- ----------- ----------- ------------
(UNAUDITED)
<S> <C> <C> <C> <C> <C>
OPERATING ACTIVITIES
Net loss............................... $(61,420) $(1,120,184) $(4,928,034) $(3,374,496) $(17,337,173)
Adjustments to reconcile net loss to
net cash used in operating
activities:
Depreciation and amortization..... 991 23,345 366,087 234,556 1,244,508
Allowance for doubtful accounts... -- -- 68,831 42,988 148,176
Deferred rent..................... -- 40,175 157 217 88,927
Preferred return.................. 3,000 61,970 18,668 18,668 --
Non-cash equity consideration..... -- 63,642 502,500 502,500 4,683,693
Interest on loan payable to
stockholder..................... -- 2,778 341,092 180,094 452,169
Changes in operating assets and
liabilities:
Accounts receivable.......... (11,994) (1,731) (429,172) (303,903) (675,236)
Other current assets......... -- (44,073) 18,382 19,672 (213,774)
Other assets................. -- (154,729) (187,470) (152,149) (2,311,468)
Accounts payable............. 5,256 159,341 509,330 391,525 486,592
Accrued expenses............. -- 78,721 335,443 315,994 2,554,957
Other liabilities............ -- -- 43,888 -- (5,738)
-------- ----------- ----------- ----------- ------------
Net cash used in operating
activities........................... (64,167) (890,745) (3,340,298) (2,124,334) (10,884,367)

INVESTING ACTIVITIES
Organization costs..................... (5,139) -- -- -- --
Acquisition of property and
equipment............................ (3,433) (349,850) (1,241,127) (894,521) (10,914,625)
-------- ----------- ----------- ----------- ------------
Net cash used in investing
activities........................... (8,572) (349,850) (1,241,127) (894,521) (10,914,625)

FINANCING ACTIVITIES
Payment of capital lease obligations... -- (3,931) (111,381) (96,441) (187,346)
Loan from stockholder.................. -- 325,000 6,070,000 3,695,000 --
Members' contributions................. 72,739 1,041,356 105,000 105,000 --
Sale of redeemable preferred stock..... -- -- -- -- 39,639,829
Return of capital...................... -- -- (306,806) (306,806) --
Deferred financing costs............... -- -- (375,673) (342,922) --
-------- ----------- ----------- ----------- ------------
Net cash provided by financing
activities........................... 72,739 1,362,425 5,381,140 3,053,831 39,452,483
-------- ----------- ----------- ----------- ------------
Increase in cash....................... -- 121,830 799,715 34,976 17,653,491
Cash at beginning of period............ -- -- 121,830 121,830 921,545
-------- ----------- ----------- ----------- ------------
Cash at end of period.................. $ -- $ 121,830 $ 921,545 $ 156,806 $ 18,575,036
-------- ----------- ----------- ----------- ------------
-------- ----------- ----------- ----------- ------------
</TABLE>

See accompanying notes.

F-6

<PAGE>

ONSITE ACCESS, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED WITH RESPECT TO THE NINE MONTHS ENDED SEPTEMBER 30, 1998 AND
SEPTEMBER 30, 1999)

1. DESCRIPTION OF BUSINESS AND BASIS OF PRESENTATION

The accompanying financial statements reflect the historical financial
information of OnSite Access, Inc., a Delaware Corporation. The original
predecessor company was Veritech Ventures, LLC ('Veritech'), which was formed on
July 5, 1996 as a New York limited liability company. On May 18, 1998, Veritech
contributed substantially all of its assets and liabilities to OnSite Ventures,
L.L.C. ('OSV'), a Delaware limited liability company. On June 30, 1999, OSV was
merged into OnSite Access, Inc. ('OSA'), a newly formed corporation. The
accompanying consolidated financial statements reflect the operations of
Veritech and OSV prior to the formation of OSA. The mergers were accounted for
as reorganizations.

The Company provides voice, data and enhanced services to small and
medium-sized business customers in multi-tenant commercial office buildings.

The Company's success will be affected by the risks, expenses and delays
encountered by early stage companies and the competitive environment in which
they operate. Certain key risk factors which may impact the Company include: the
Company's ability to successfully market its products and services and to
generate profitable results, the availability of adequate financial and capital
resources to finance the execution of the Company's business plan, the Company's
industry is highly competitive and competition is expected to increase, the
Company operates in an industry subject to rapid technological changes and
future changes may negatively impact the Company's ability to successfully
market its products and services, the availability of adequate network capacity
from other communications carriers as well as adequate third party field support
and network security, the inability to attract and retain key personnel,
inadequacy of intellectual property protections, regulatory and legislative
requirements and the Company's ability to manage its anticipated growth
including implementation of information processing systems. The Company's
failure to mitigate these significant risk factors will have a material adverse
effect on the Company's business, financial condition and results of operations.
Although management believes that the Company will be able to successfully
mitigate these risks, management cannot give assurances that it will be able to
do so or that the Company will ever operate profitably.

In accordance with Accounting Principles Board ('APB') Opinion No. 20, in
connection with this registration of its securities the Company changed its
method of capitalizing overhead costs relating to its infrastructure
construction and revised the estimate of the value of options issued to an
officer. The effect of these changes was to increase the net loss in 1997 and
1998 by approximately $64,000 and $15,000, respectively.

PRINCIPLES OF CONSOLIDATION

The consolidated financial statements include the accounts of the Company
and its subsidiaries. All significant intercompany accounts and transactions
have been eliminated in consolidation.

PROPERTY AND EQUIPMENT

Property and equipment are stated at cost and depreciated once placed in
service using the straight-line method. Equipment held under capital lease
obligations is amortized over the estimated useful life of the asset.

The Company periodically evaluates its long-lived assets, including
property and equipment, to determine whether events or changes in circumstances
have occurred that indicate the remaining asset balances may not be recoverable
and an impairment loss should be recorded. Recoverability of assets is measured
by comparing the carrying amount of an asset to the undiscounted future cash
flows estimated to be generated by the asset. If such assets are considered to
be impaired the impairment to be recognized is measured by the amount by which
the carrying amount of the assets exceeds the fair value of the assets.

F-7

<PAGE>

ONSITE ACCESS, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)
(UNAUDITED WITH RESPECT TO THE NINE MONTHS ENDED SEPTEMBER 30, 1998 AND
SEPTEMBER 30, 1999)

1. DESCRIPTION OF BUSINESS AND BASIS OF PRESENTATION -- CONTINUED
CASH AND CASH EQUIVALENTS

The Company considers all highly liquid financial instruments purchased
with a maturity of three months or less to be cash equivalents. At
September 30, 1999, the Company's cash and cash equivalents are maintained at
one financial institution.

CONCENTRATION

Revenue derived from significant customers (i.e., customers individually
accounting for 10% or more of the Company's revenues) for 1996 and for the years
ended December 31, 1997 and 1998 and for the nine months ended September 30,
1998 and 1999 was approximately 60% (one customer), 88% (one customer), 25% (two
customers), 41% (three customers) and 12% (one customer), respectively.

ADVERTISING COSTS

The Company's policy is to expense advertising costs as incurred. For the
years ended December 31, 1996, 1997 and for 1998 and for the nine months ended
September 30, 1998 and 1999, the Company incurred approximately $0, $19,000,
$85,000, $59,000 and $980,000 of advertising costs, respectively.

USE OF ESTIMATES

The preparation of financial statements in conformity with generally
accepted accounting principles requires management to make estimates and
assumptions that affect the amounts reported in the financial statements and
accompanying notes. Actual results could differ from those estimates.

INTERIM FINANCIAL INFORMATION

The unaudited interim information as of September 30, 1999 and for the nine
months ended September 30, 1998 and 1999 has been prepared on the same basis as
the annual financial statements and, in the opinion of the Company's management,
contains all adjustments (consisting of normal recurring accruals) necessary for
a fair presentation. Operating results for any interim period are not
necessarily indicative of results to be expected for the entire year.

REVENUE RECOGNITION

Revenue primarily includes voice and data services, including high speed
Internet access. Voice services are generally both subscription-based and
usage-based services to customers under one year contracts. Data services are
generally subscription-based services to customers under one year contracts.
Installation revenues are non-recurring fees for access to our network and, to
date, typically have not exceeded the direct cost of installation. Revenues are
recognized in the month in which the services are provided and the usage occurs.
All expenses related to services provided are recognized as incurred.

INCOME TAXES

The Company accounts for income taxes using the liability method. Under
this method, deferred tax assets and liabilities are determined based on
differences between the financial reporting and tax bases of assets and
liabilities.

F-8

<PAGE>

ONSITE ACCESS, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)
(UNAUDITED WITH RESPECT TO THE NINE MONTHS ENDED SEPTEMBER 30, 1998 AND
SEPTEMBER 30, 1999)

1. DESCRIPTION OF BUSINESS AND BASIS OF PRESENTATION -- CONTINUED
STOCK BASED COMPENSATION

The Company applies the disclosure-only provisions of Statement of
Financial Accounting Standards (SFAS) No. 123, Accounting for Stock-Based
Compensation. The Company accounts for stock options using APB Opinion No. 25,
Accounting for Stock Issued to Employees and related interpretations. Options
issued to non-employees are accounted for in accordance with SFAS No. 123.

EARNINGS (LOSS) PER SHARE

Earnings (loss) per share is calculated in accordance with SFAS No. 128,
Earnings per Share. Basic earnings (loss) per share is computed by dividing the
net income (loss) applicable to common shares by the weighted average number of
common shares outstanding during the period. Diluted earnings (loss) per share
adjusts basic earnings (loss) per share for the effects of convertible
securities, stock options and other potentially dilutive financial instruments,
only in the periods in which such effect is dilutive. There were no dilutive
securities in any of the periods presented herein.

RECENTLY ISSUED FINANCIAL ACCOUNTING STANDARDS

SFAS No. 131, Disclosure about Segments of an Enterprise and Related
Information, was issued in June 1997. The Company adopted the new statement for
the year ending December 31, 1998. This statement requires use of the
'management approach' model for segment reporting. The management approach model
is based on the way a company's management organizes segments within the company
for making operating decisions and assessing performance. Reportable segments
are based on products and services, geography, legal structure, management
structure, or any other manner in which management disaggregates a company. The
Company adopted this statement in fiscal 1998 in anticipation of an initial
public offering. The adoption of the statement did not have a significant impact
on its financial statements as it operates in one segment.

2. STOCKHOLDERS'/MEMBERS' EQUITY

Prior to the formation of OSA, the OSV and Veritech operating agreements
provided governance for the maintenance of individual member capital accounts,
the allocation of profit and loss to such capital accounts, the accretion of a
preferred return to certain outstanding member capital balances, and the return
of such capital from available cash flow. At the time of the merger of OSV and
the Company, all members equity interest accounts were converted to shares of
common stock.

During 1997 and 1998, the Company incurred non-cash compensation expenses
in the amount of $63,642 and $502,500, respectively, for the issuance to an
officer of the Company of options to purchase membership interests.

Under the terms of the OSV and Veritech operating agreements preferred
returns were guaranteed to certain members. Such preferred returns have been
recorded as expenses in the accompanying statements of operations.

F-9

<PAGE>

ONSITE ACCESS, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)
(UNAUDITED WITH RESPECT TO THE NINE MONTHS ENDED SEPTEMBER 30, 1998 AND
SEPTEMBER 30, 1999)

3. PROPERTY AND EQUIPMENT

Property and equipment consist of the following:

<TABLE>
<CAPTION>
DECEMBER 31,
------------------------- SEPTEMBER 30,
1997 1998 1999
------------ ---------- -------------
<S> <C> <C> <C>
Cabling infrastructure......................... $138,486 $ 994,688 $ 3,766,623
Computer hardware, software and equipment...... 378,319 1,389,294 9,007,587
Leasehold improvements......................... 69,330 92,892 2,954,244
Service vehicles............................... -- 40,592 102,740
Furniture and fixtures......................... 5,110 52,348 506,804
-------- ---------- -------------
591,245 2,569,814 16,337,998
Less accumulated depreciation and
amortization................................. 22,794 336,450 1,485,784
-------- ---------- -------------
$568,451 $2,233,364 $ 14,852,214
-------- ---------- -------------
-------- ---------- -------------
</TABLE>

Cabling infrastructure consists of wiring and labor and overhead charges
incurred in the installation of in-building broadband networks.

At December 31, 1997 and 1998 and September 30, 1998 and 1999, $64,000,
$233,000, $52,000 and $501,000 of equipment purchases are included in accounts
payable and accrued expenses, respectively.

4. CAPITAL LEASES

During 1997, 1998 and 1999, the Company entered into long-term lease
agreements for equipment. These leases have three year lease terms and bear
interest ranging from 10% to 15% per annum and provide the Company with a
bargain purchase option. For financial reporting purposes, equipment classified
as capital leases amounted to approximately $170,000, $563,000, $295,000 and
$2,728,000 at December 31, 1997 and 1998 and September 30, 1998 and 1999,
respectively.

The future minimum lease payments under the capital leases at
September 30, 1999 are as follows:

<TABLE>
<S> <C>
October 1 to December 31, 1999.............................. $ 72,059
2000........................................................ 1,147,793
2001........................................................ 1,187,753
2002........................................................ 697,060
----------
Total minimum lease payments........................... 3,104,665
Amounts representing interest............................... 376,627
----------
Present value of net minimum lease payments (including
current portion of $240,701).............................. $2,728,038
----------
----------
</TABLE>

5. CREDIT FACILITY

In 1999, the Company entered into a line of credit (the 'Agreement') with
Ascend Communications, a wholly owned subsidiary of Lucent Technologies, Inc.,
which expires on September 30, 2000. Under the Agreement, the Company may borrow
$50 million for purchases of equipment from Ascend. Each draw on the line of
credit converts into a new 36 month lease. At September 30, 1999, $25 million
was made available to the Company and the remaining $25 million was made
available to the Company in December 1999 when certain criteria, as defined by
the Agreement, were met. At September 30, 1999, the Company made its first draw
against this credit for $2.3 million. This equipment has been accounted for as a
capital lease.

F-10

<PAGE>

ONSITE ACCESS, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)
(UNAUDITED WITH RESPECT TO THE NINE MONTHS ENDED SEPTEMBER 30, 1998 AND
SEPTEMBER 30, 1999)

6. COMMITMENTS AND CONTINGENCIES

LEASES

The Company has operating lease commitments for office space and equipment
which expire through July 31, 2010. These operating leases provide for basic
annual rents plus escalation charges. Minimum commitments through the life of
such leases are approximately as follows:

<TABLE>
<S> <C>
October 1 to December 31, 1999.............................. $ 289,000
2000........................................................ 1,066,000
2001........................................................ 1,067,000
2002........................................................ 1,024,000
2003........................................................ 946,000
2004........................................................ 943,000
Thereafter.................................................. 5,264,000
-----------
Total.................................................. $10,599,000
-----------
-----------
</TABLE>

In accordance with the provisions of SFAS No. 13, Accounting for Leases,
the aggregate of the total minimum lease payments is amortized on the
straight-line method over the term of the lease. The difference between the
straight-line rent expense and the amounts paid in accordance with the terms of
the lease has been included in 'Deferred Rent'. Rent expense was approximately
$0, $64,000, $168,000, $108,000 and $784,000 for 1996 and for the years ended
December 31, 1997 and 1998 and for the nine months ended September 30, 1998 and
1999, respectively.

EMPLOYMENT ARRANGEMENTS

As of September 30, 1999, the Company has entered into employment
arrangements with certain executives, which obligate the Company to make total
payments of $1,247,500 through 2001.

NETWORK CONTRACTS

In order to provide its services, the Company enters into contracts with
its wholesale voice services providers, Internet access providers and data
transmission capacity providers. In the event the Company fails to meet its
minimum volume commitments for national connectivity it is obligated to pay
underutilization charges.

Future minimum obligations as of September 30, 1999, related to the
Company's voice and data connectivity contracts are as follows:

<TABLE>
<S> <C>
October 1 to December 31, 1999. $ 1,052,000
2000........................................................ 4,092,000
2001........................................................ 3,942,000
2002........................................................ 1,633,000
2003........................................................ 1,329,000
-----------
Total minimum lease obligations........................ $12,048,000
-----------
-----------
</TABLE>

COMMISSIONS AND FEES

The Company has entered into service agreements with real estate owners and
agents representing real estate owners pursuant to which the Company has the
right to provide equipment and services to the real estate owners' buildings and
tenants. Under the terms of these

F-11

<PAGE>

ONSITE ACCESS, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)
(UNAUDITED WITH RESPECT TO THE NINE MONTHS ENDED SEPTEMBER 30, 1998 AND
SEPTEMBER 30, 1999)

6. COMMITMENTS AND CONTINGENCIES -- CONTINUED
agreements, the Company is obligated to pay monthly fees and commissions upon
the completion of performance obligations. The agreements require the Company to
make future minimum payments approximating: $2,020,000 (October 1 to December
31, 1999), $1,116,000 (2000), $127,000 (2001), $128,000 (2002), $128,000 (2003),
$129,000 (2004) and $424,000 (thereafter).

7. DEBT

LOAN FROM STOCKHOLDER

As of December 31, 1997 and 1998, the Company had amounts outstanding under
a loan agreement with a stockholder of $325,000 and $6,500,000, respectively. In
connection with the $6,500,000 loan, the Company issued the lender a 1%
membership interest. Amounts outstanding bore interest at 12% per annum. In
connection with the Financing Facility (see Note 8), the 1% membership interest
and the principal and accrued interest outstanding under this loan agreement
were converted on July 1, 1999 into 5,869,000 shares of Series A preferred
stock.

BRIDGE LOANS

On February 10, 1999, the Company entered into a Senior Secured Promissory
Note and Loan and Security Agreement with certain stockholders in an amount not
to exceed $4 million (the 'Bridge Loan'). In February and March 1999, the
Company borrowed $3 million under the Bridge Loan which bore interest at 11% per
annum. The Bridge Loan, including accrued interest was repaid on April 16, 1999
in connection with the Financing Facility.

On April 16, 1999, the Company entered into promissory notes and security
agreements with each of the investors (the 'Investor Bridge Loan') in the
aggregate principal amount of $20 million, which bore interest at 12% per annum.
The Investor Bridge Loan, including accrued interest, of $20.5 million was
converted into Series B, C and D preferred stock on July 1, 1999.

8. PREFERRED STOCK

On July 1, 1999, pursuant to an agreement dated April 16, 1999, the Company
closed on a funding of up to $60 million in the form of Series B, C and D
preferred stock (the 'Financing Facility'). Simultaneously with the closing of
the Financing Facility, the Investor Bridge Loan, including the accrued
interest, of $20.5 million was converted into 17,083,106 shares of Series B
preferred stock, 8,565,344 shares of Series C preferred stock and 133,970 shares
of Series D preferred stock. In September 1999, the Company received an
additional $20 million under the Financing Facility in exchange for 16,666,667
shares of Series B preferred stock, 8,356,546 shares of Series C preferred
stock, and 130,704 shares of Series D preferred stock. In December 1999, the
Company received the remaining $19.5 million under the Financing Facility in
exchange for 16,250,227 shares of Series B preferred stock, 8,147,744 shares of
Series C preferred stock and 127,437 shares of Series D preferred stock.

Under the Company's Certificate of Designation, upon completion of a
qualified initial public offering ('IPO'), all outstanding shares of our
Series A, Series C and Series D preferred stock will automatically convert into
shares of our common stock on a one-for-one basis. In addition, effective as of
December 10, 1999, the Company amended its certificate of designation to provide
that Series B preferred stock will convert automatically into common stock upon
completion of a qualified IPO at the IPO price.

F-12

<PAGE>

ONSITE ACCESS, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)
(UNAUDITED WITH RESPECT TO THE NINE MONTHS ENDED SEPTEMBER 30, 1998 AND
SEPTEMBER 30, 1999)

8. PREFERRED STOCK -- CONTINUED
The preferred stockholders are entitled to certain rights as described
below:

The Series A, Series C and Series D preferred stock (collectively, the
'Convertible Preferred Stock') are convertible into common stock on a one for
one basis, subject to certain anti-dilution provisions, as defined, at any time
at the option of the holder or automatically in the event of a qualified IPO.
The holders of the Series A and C preferred stock are entitled to (a) one vote
for each share of preferred stock on those matters expressly provided for in the
Company's certificate of incorporation, bylaws or certificate of designation and
(b) on all other matters, one vote for each share of common stock into which
their shares of preferred stock would otherwise be converted.

The Series B, C and D preferred stock (collectively, the 'Redeemable
Preferred Stock') can be redeemed upon liquidation of the Company, including any
merger or acquisition where the existing stockholders of the Company own less
than 50% of the successor entity. In the event that the Redeemable Preferred
Stock has not been redeemed prior to July 1, 2004, the Redeemable Preferred
Stock would be redeemed in three installments on July 1, 2004, July 1, 2005 and
July 1, 2006. The redemption price for the Redeemable Preferred Stock would be
the original price paid per share, plus a 12% cumulative return less any
dividends paid. The Series A preferred stock has preferred liquidation rights
ahead of common stock holders, but is subject to the liquidation and redemption
rights of the Redeemable Preferred Stock.

9. INCOME TAXES

The Company was originally organized as a limited liability company ('LLC')
which elected to be taxed as a partnership for federal income tax purposes.
Since the Company was not subject to federal and state income taxes for the
period through June 30, 1999, no income tax provision was recorded. Instead, the
LLC members included the taxable income or loss of the Company in their
individual income tax returns.

Effective July 1, 1999, the Company converted to a corporation and is now
subject to federal, state and local income taxes. At June 30, 1999, the Company
recorded a net deferred tax liability of approximately $328,000.

For the three months ended September 30, 1999, the Company recorded a
cumulative net deferred tax benefit of $328,000. The Company, therefore, had no
provision for federal, state or local taxes for the nine month period ended
September 30, 1999.

Deferred income taxes represent the net tax effects of temporary
differences between the carrying amount of assets and liabilities for financial
reporting purposes and amounts used for income tax purposes.

F-13

<PAGE>

ONSITE ACCESS, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)
(UNAUDITED WITH RESPECT TO THE NINE MONTHS ENDED SEPTEMBER 30, 1998 AND
SEPTEMBER 30, 1999)

9. INCOME TAXES -- CONTINUED
Significant components of the Company's deferred tax assets and liabilities
consist of the following:

<TABLE>
<CAPTION>
SEPTEMBER 30, 1999
------------------
<S> <C>
Deferred Tax Assets:
Net operating loss carryforward....................... $2,596,000
Deferred rent......................................... 34,000
Accounts receivable allowances........................ 89,000
Organizational costs.................................. 77,000
Other................................................. 2,000
----------

Gross deferred tax asset................................... 2,798,000
Deferred tax liabilities:
Depreciation and amortization......................... (556,000)
----------
Gross deferred tax liability............................... (556,000)

Valuation allowance........................................ (2,242,000)
----------
Net deferred tax asset/(liability)......................... $ --
----------
----------
</TABLE>

At September 30, 1999, the deferred tax asset has been eliminated by the
valuation allowance because it is more likely than not that the Company will not
realize the tax benefit as defined by SFAS No. 109.

The reconciliations of income tax expense computed at the U.S. federal
statutory rate to income tax expense for 1996 and the years ended December 31,
1997, 1998 and for the nine months ended September 30, 1998 and 1999 are as
follows:

<TABLE>
<CAPTION>
DECEMBER 31, SEPTEMBER 30,
---------------------------------- -------------------------
1996 1997 1998 1998 1999
-------- --------- ----------- ----------- -----------
<S> <C> <C> <C> <C> <C>
Benefit at federal statutory rate
(35%)............................ $(21,000) $(366,000) $(1,720,000) $(1,290,000) $(4,429,000)
Expenses not deductible for U.S.
tax purposes..................... -- 24,000 77,000 58,000 8,000
Losses for which no benefit has
been provided.................... 21,000 342,000 1,643,000 1,232,000 4,421,000
-------- --------- ----------- ----------- -----------
$ -- $ -- $ -- $ -- $ --
-------- --------- ----------- ----------- -----------
-------- --------- ----------- ----------- -----------
</TABLE>

At September 30, 1999, the Company had a net operating loss carryforward of
approximately $6,332,000 for U.S federal income tax purposes. The Company's net
operating loss began accumulating effective July 1, 1999, the date of
incorporation. The net operating loss will expire in the year 2019.

10. RELATED PARTY TRANSACTIONS

During 1996 and the years ended December 31, 1997 and 1998 and the nine
months ended September 30, 1998 and 1999, the Company rented temporary office
space to house regional sales personnel from an affiliate whereby the Company
paid approximately $0, $0, $23,000, $15,000 and $35,000, respectively, to such
affiliate.

During the year ended December 31, 1997, the Company purchased $56,000 of
construction services from a related party of which $26,000 was included in
accounts payable at December 31, 1997.

F-14

<PAGE>

ONSITE ACCESS, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)
(UNAUDITED WITH RESPECT TO THE NINE MONTHS ENDED SEPTEMBER 30, 1998 AND
SEPTEMBER 30, 1999)

10. RELATED PARTY TRANSACTIONS -- CONTINUED
The Company provides telecommunication services to tenants in commercial
office buildings which are owned by an affiliate of one of the stockholders.
Revenue from tenants in this stockholder's affiliated buildings was
approximately $0, $0, $223,000, $125,000 and $519,000 and corresponding
commissions paid to the stockholder were approximately $0, $0, $9,000, $5,000
and $30,000, for 1996 and the years ended December 31, 1997 and 1998 and the
nine months ended September 30, 1998 and 1999, respectively.

Additionally, the Company provides telecommunications services to
affiliates of one of the stockholders. Revenues from this stockholder's
affiliates was approximately $0, $0, $153,000, $78,000 and $427,000 for 1996 and
for the years ended December 31, 1997 and 1998 and the nine months ended
September 30, 1998 and 1999, respectively.

11. ACCRUED EXPENSES

Accrued expenses consist of the following:

<TABLE>
<CAPTION>
DECEMBER 31,
------------------ SEPTEMBER 30,
1997 1998 1999
------- -------- --------------
<S> <C> <C> <C>
Service providers................................... $30,994 $ 57,902 $ 219,255
Commissions......................................... -- 46,936 173,991
Bonuses............................................. -- 271,326 1,158,245
Advertising......................................... -- -- 397,810
Property and equipment.............................. -- -- 501,104
Professional fees................................... 20,000 38,000 830,559
Other............................................... 27,727 -- 189,261
------- -------- ----------
$78,721 $414,164 $3,470,225
------- -------- ----------
------- -------- ----------
</TABLE>

12. STOCK OPTIONS

Under the Company's 1999 Stock Plan, as amended (the 'Plan'), 9,489,897
shares of common stock are available for award to employees, officers,
directors, or consultants. Pursuant to the Plan, the Company's board of
directors or a committee appointed by the board may grant stock options or stock
purchase rights. The terms of any particular grant, including any
performance-based requirements, vesting terms and other restrictions are
determined by the board or by a committee appointed by the board.

The exercise price of nonstatutory options may be above, at or below fair
market value of the common stock on the grant date. The exercise price of
incentive stock options must not be less than the fair market value on the grant
date. The exercise period of options may be set by the board or the committee
appointed by the board but may not exceed ten years.

The Company accounts for stock options and other employee awards under the
provisions of APB Opinion No. 25, Accounting for Stock Issued to Employees.

For the period from July 1, 1999 through September 30, 1999, the Company
granted 1,403,125 stock options with an exercise price of $.45 per share. For
the period from October 1, 1999 through December 13, 1999, the Company granted
1,028,000 stock options with an exercise price of $.45.

For the period from July 1, 1999 through September 30, 1999, the Company
sold 4,763,397 shares of restricted stock to certain officers of the Company for
$.45 per share. For the period from October 1, 1999 through December 13, 1999,
the Company sold 600,000 shares of restricted stock to certain officers of the
Company for $.45 per share.

F-15

<PAGE>

ONSITE ACCESS, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)
(UNAUDITED WITH RESPECT TO THE NINE MONTHS ENDED SEPTEMBER 30, 1998 AND
SEPTEMBER 30, 1999)

12. STOCK OPTIONS -- CONTINUED
The Company engaged an independent third party to perform a valuation of
the Company's common stock. The valuation indicated a common stock value of
$4.32 to $6.84 per share from July 1, 1999 through December 1, 1999.

The Company recorded deferred compensation of approximately $19,493,000 for
grants of stock options and the sales of restricted stock made between July 1,
1999 and September 30, 1999 and plans to record deferred compensation of
approximately $9,376,000 for grants of stock options made between
October 1, 1999 and December 13, 1999. The recorded deferred compensation
represents the difference between the exercise price of stock options
granted to employees or the sales price of restricted stock sold to certain
officers and fair market value based on the appraisals. This amount will be
amortized over the applicable vesting period, which is generally four years.

13. PRO FORMA EARNINGS PER SHARE

Simultaneously with the Company's IPO, pursuant to the terms of the
Company's Certificate of Designation, each share of Series A, C and D preferred
stock will automatically convert into shares of common stock on a one-for-one
basis (see Note 8). Accrued dividends on the preferred stock will be paid as of
the IPO. Assuming the offering price at the midpoint of the estimated price
range of the IPO of $ per share, the shares of Series B preferred stock
outstanding will be converted into shares of common stock. Had the
conversion of preferred stock occurred at the date of issuance, net loss per the
share for the nine months ended September 30, 1999 would have been $( ) per
share.

14. WARRANTS

In November and December 1999, the Company agreed to issue warrants to real
estate agents to acquire shares of our common stock at an exercise price of
$2.36 per share in exchange for services related to the facilitation of access
agreements with real estate owners. These warrants will generally vest upon the
performance of services or execution of access agreements with real estate
owners. The measurement dates for valuing the warrants will be the dates on
which the warrants vest. On the measurement date, the prevailing fair market
value of the common stock less the excercise price of the warrants will be
expensed as non-cash equity consideration.

In November and December 1999, the Company agreed to issue warrants to real
estate owners to acquire shares of our common stock at an exercise price of
$2.36 per share. These warrants will generally vest upon the execution of access
agreements for specific buildings. The measurement dates for valuing the
warrants will be the dates on which the real estate owners sign the access
agreements for specific buildings. The fair value of the warrants will be
capitalized and amortized over future periods not to exceed the term of the
related access agreements.

F-16

<PAGE>

- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
SHARES
ONSITE ACCESS, INC.
COMMON STOCK

[LOGO]
------------
PROSPECTUS
, 2000
------------

SALOMON SMITH BARNEY
J.P. MORGAN & CO.
CIBC WORLD MARKETS
THOMAS WEISEL PARTNERS LLC

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

<PAGE>

PART II
INFORMATION NOT REQUIRED IN PROSPECTUS

ITEM 13. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION.

The following table sets forth expenses and costs payable by us (other than
underwriting discounts and commissions) expected to be incurred in connection
with the issuance and distribution of the securities described in this
registration statement. All amounts are estimated except for the Securities and
Exchange Commission's registration fee and the National Association of
Securities Dealers' filing fee.

<TABLE>
<CAPTION>
AMOUNT
------
<S> <C>
SEC Registration fee under Securities Act................... $52,800
NASD filing fee............................................. 20,500
Nasdaq National Market listing fees......................... *
Legal fees and expenses..................................... *
Accounting fees and expenses................................ *
Printing and engraving expenses............................. *
Registrar and transfer agent fees........................... *
Miscellaneous expenses...................................... *
-------
Total....................................................... $
-------
-------
</TABLE>

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

* To be filed by amendment.

ITEM 14. INDEMNIFICATION OF DIRECTORS AND OFFICERS.

Section 102 of the Delaware General Corporation Law, as amended (the
'DGCL'), allows a corporation to eliminate the personal liability of directors
of a corporation to the corporation or its stockholders for monetary damages for
a breach of fiduciary duty as a director, except where the director breached his
duty of loyalty, failed to act in good faith, engaged in intentional misconduct
or knowingly violated a law, authorized the payment of a dividend or approved a
stock repurchase in violation of Delaware corporate law or obtained an improper
personal benefit. Section 145 of the DGCL provides that a corporation may
indemnify directors and officers as well as other employees and individuals
against expenses (including attorneys' fees), judgments, fines and amounts paid
in settlement in connection with specified actions, suits and proceedings,
whether civil, criminal, administrative, or investigative (other than an action
by or in the right of the corporation, a 'derivative action'), if they acted in
good faith and in a manner they 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 their conduct was unlawful. A
similar standard is applicable in the case of derivative actions, except that
indemnification only extends to expenses (including attorneys' fees) incurred in
connection with the defense or settlement of such action, and the statute
requires court approval before there can be any indemnification where the person
seeking indemnification has been found liable to the corporation. The statute
provides that it is not exclusive of other indemnification that may be granted
by a corporation's certificate of incorporation, bylaws, disinterested director
vote, stockholder vote, agreement, or otherwise.

Our certificate of incorporation includes a provision that eliminates the
personal liability of a director for monetary damages for breach of fiduciary
duty as a director, except for liability (i) for any breach of the director's
duty of loyalty to OnSite or its stockholders; (ii) for acts or omissions not in
good faith or that involve intentional misconduct or a knowing violation of law;
(iii) under Section 174 of the DGCL regarding the unlawful payment of dividends
or an unlawful stock purchase or redemption; or (iv) for any transaction from
which the director received an improper personal benefit. Our bylaws require us
to indemnify any person made or threatened to be made a party to an action, suit
or proceeding, whether criminal, civil, administrative or investigative, by

II-1

<PAGE>

reason of the fact that he or she or a person of whom he or she is the legal
representative is or was a director, officer, employee or agent of OnSite or is
or was serving at the request of OnSite as a director, officer, employee or
agent of another corporation or of a partnership, joint venture, trust or other
enterprise including service with respect to employee benefit plans maintained
or sponsored by us. Our bylaws also provide that we may advance expenses, as
incurred, to our directors, officers and other agents and employees in
connection with a legal proceeding. The indemnification provisions of our bylaws
are not exclusive of any other rights to which a person may be entitled by law,
agreement, vote of stockholders or disinterested directors or otherwise.

OnSite has obtained primary insurance policies insuring certain of its
directors and officers against certain liabilities they may incur in their
capacity as directors and officers. Under these policies, the insurer, on behalf
of OnSite, may also pay amounts for which OnSite has granted indemnification to
the directors and officers of OnSite.

ITEM 15. RECENT SALES OF UNREGISTERED SECURITIES.

Since our incorporation in April 1999, we have issued and sold the
securities listed below. All sales were made in reliance on Section 4(2) of the
Securities Act and/or Regulation D or Rule 701 promulgated under the Securities
Act and were made without general solicitation or advertising.

1. On July 1, 1999, we issued 4,537,603 shares of common stock to the
former members of OnSite Ventures, L.L.C., pursuant to our merger
agreement with OnSite Ventures, L.L.C., which provided that each
member's limited liability company common units automatically converted
into shares of our common stock upon consummation of our merger with
OnSite Ventures, L.L.C.

2. On July 1, 1999, in connection with our merger with OnSite Ventures,
L.L.C., we issued 5,869,000 shares of Series A preferred stock to
RSI-OSA Holdings, Inc. in exchange for the cancellation of a
$6.5 million promissory note, dated as of February 10, 1999, issued by
OnSite Ventures, L.L.C.

3. On July 1, 1999, we issued an aggregate of 17,083,106 shares of
Series B preferred stock, 8,565,344 shares of Series C preferred stock
and 133,970 shares of Series D preferred stock to a group of private
equity investors in exchange for the cancellation of promissory notes
issued by OnSite Ventures, L.L.C. in an aggregate principal amount of
approximately $20 million, plus accrued interest.

4. On July 1, 1999, pursuant to a subscription agreement, we issued an
aggregate of 511,620 shares of our common stock to certain affiliated
parties for a purchase price of $230,229.

5. On September 7, 1999, we issued an aggregate of 16,666,667 shares of
Series B preferred stock, 8,356,546 shares of Series C preferred stock
and 130,704 shares of Series D preferred stock to a group of private
investors in exchange for approximately $20.0 million of financing.

6. On December 10, 1999, we issued an aggregate of 16,250,227 shares of
Series B preferred stock, 8,147,744 shares of Series C preferred stock
and 127,437 shares of Series D preferred stock to a group of private
equity investors in exchange for approximately $19.5 million of
financing.

7. In November and December 1999, we agreed to issue to a group of real
estate owners and agents warrants to acquire shares of our common stock
in exchange for the execution of access agreements for specific
buildings and services related to the facilitation of access agreements.
The warrants have an exercise price of $2.36 per share.

8. To date, we have granted stock options to purchase an aggregate of
2,431,125 shares of our common stock at an exercise price of $.45 to our
employees and officers, pursuant to our 1999 Stock Plan.

9. To date, we have issued an aggregate of 5,363,397 shares of common stock
to certain of our officers as the result of exercises of restricted
stock purchase rights for aggregate consideration of approximately
$2,413,529 paid in the form of cash and/or promissory notes.

II-2

<PAGE>

ITEM 16. EXHIBITS AND FINANCIAL STATEMENT SCHEDULES.

(a) Exhibits:

The following documents are filed as exhibits to this registration statement:

<TABLE>
<CAPTION>
EXHIBIT DESCRIPTION
- ------- -----------
<C> <S>
1.1 Form of Underwriting Agreement*
3.1 Form of Certificate of Incorporation of OnSite Access, Inc.,
as amended and restated*
3.2 Form of Bylaws of OnSite Access, Inc., as amended and
restated*
4.1 Form of certificate for common stock*
5.1 Opinion of Fried, Frank, Harris, Shriver & Jacobson*
9.1 Voting Agreement, dated April 16, 1999*
10.1 Master Lease Agreement, dated September 29, 1999, between
Ascend Communications, Inc., a wholly owned subsidiary of
Lucent Technologies, Inc., and OnSite Access L.L.C.*
10.2 Lease for 1372 Broadway, New York, New York*
10.3 Series B, Series C and Series D Preferred Stock Purchase
Agreement, dated
April 16, 1999*
10.4 Subscription Agreement, dated July 1, 1999, between
RSI-OnSite Holdings LLC, Veritech Ventures LLC, Arthur Simon
and OnSite Access, Inc.*
10.5 Investor Rights Agreement, dated April 16, 1999*
10.7 1999 Stock Plan*
21.1 Subsidiaries of OnSite Access, Inc.*
23.1 Consent of Ernst & Young LLP
23.2 Consent of Fried, Frank, Harris, Shriver & Jacobson
(included in Exhibit 5.1 above)*
24.1 Power of Attorney (included on the signature page to the
Registration Statement)
27.1 Financial Data Schedule
</TABLE>

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

* To be filed by amendment.

(b) Financial Statement Schedules:

ITEM 17. UNDERTAKINGS.

Insofar as indemnification for liabilities arising under the Securities Act
of 1933 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 indemnification is against public policy as expressed in the 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 proceeding) 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 Act and will be governed by the final adjudication of
such issue.

The undersigned registrant hereby undertakes that:

(1) To provide to the underwriters at the closing specified in the
underwriting agreement certificates in such denominations and
registered in such names as required by the underwriters to permit
prompt delivery to each purchaser.

(2) For purposes of determining any liability under the Securities Act of
1933, the information omitted from the form of prospectus filed as part
of this registration statement in reliance upon Rule 430A and contained
in a form of prospectus filed by the registrant pursuant to
Rule 424(b)(1) or (4) or 497(h) under the Securities Act shall be
deemed to be part of this registration statement as of the time it was
declared effective.

(3) For the purpose of determining any liability under the Securities Act
of 1933, each post-effective amendment that contains a form of
prospectus 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.

II-3

<PAGE>

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 New York, State of New
York, on December 15, 1999.

ONSITE ACCESS, INC.

By /s/ KENNETH J. HALL
..................................
KENNETH J. HALL
EXECUTIVE VICE PRESIDENT AND CHIEF
FINANCIAL OFFICER

The undersigned directors and officers of OnSite Access, Inc. hereby
constitute and appoint Howard E. Taylor and Kenneth J. Hall and each of them
with full power to act without the other and with full power of substitution and
resubstitution, our true and lawful attorneys-in-fact with full power to execute
in our name and behalf in the capacities indicated below this Registration
Statement on Form S-1 and any and all amendments thereto, including
post-effective amendments to this Registration Statement and to sign any and all
additional registration statements relating to the same offering of securities
as this Registration Statement that are filed pursuant to Rule 462(b) of the
Securities Act of 1933, and to file the same, with all exhibits thereto and
other documents in connection therewith, with the Securities and Exchange
Commission and hereby ratify and confirm that all such attorneys-in-fact, or any
of them, or their substitutes shall lawfully do or cause to be done by virtue
hereof.

Pursuant to the requirements of the Securities Act, this registration
statement has been signed by the following persons in the capacities and on the
dates indicated.

<TABLE>
<CAPTION>
SIGNATURE TITLE DATE
--------- ----- ----
<C> <S> <C>
/s/ HOWARD E. TAYLOR Chairman of the Board and Chief December 15, 1999
......................................... Executive Officer (Principal
HOWARD E. TAYLOR Executive Officer)

/s/ KENNETH J. HALL Executive Vice President and Chief December 15, 1999
......................................... Financial Officer (Principal
KENNETH J. HALL Financial and Accounting Officer)

/s/ W. MONTGOMERY CERF Director December 15, 1999
.........................................
W. MONTGOMERY CERF

/s/ STEVEN FOSTER Director December 15, 1999
.........................................
STEVEN FOSTER

/s/ MATTHEW MOCHARY Director December 15, 1999
.........................................
MATTHEW MOCHARY

/s/ JEFFREY D. NEUMANN Director December 15, 1999
.........................................
JEFFREY D. NEUMANN

/s/ SCOTT H. RECHLER Director December 15, 1999
.........................................
SCOTT H. RECHLER
</TABLE>

II-4

<PAGE>

REPORT OF INDEPENDENT AUDITORS

We have audited the consolidated financial statements of OnSite Access,
Inc. (formerly OnSite Ventures LLC and Veritech Ventures LLC) as of December 31,
1997 and 1998, and for the period from July 5, 1996 (date of inception) to
December 31, 1996 and for the years ended December 31, 1997 and 1998, and have
issued our report thereon dated November 5, 1999 (included elsewhere in this
Registration Statement). Our audits also included the financial statement
schedule listed in Item 16(b) of this Registration Statement. This schedule is
the responsibility of the Company's management. Our responsibility is to
express an opinion based on our audits.

In our opinion, the financial statement schedule referred to above, when
considered in relation to the basic financial statements taken as a whole,
presents fairly in all material respects the information set forth therein.

/s/ ERNST & YOUNG LLP

New York, New York
November 5, 1999

S-1

<PAGE>

SCHEDULE II -- VALUATION AND QUALIFYING ACCOUNTS
ONSITE ACCESS, INC. AND SUBSIDIARIES

<TABLE>
<CAPTION>
COL. A COL. B COL. C COL. D COL. E
------ ------ ---------------------- ------ ------
ADDITIONS
----------------------
CHARGED TO
BALANCE AT CHARGED TO OTHER BALANCE AT
BEGINNING COSTS AND ACCOUNTS - DEDUCTIONS - END OF
DESCRIPTION OF PERIOD EXPENSES DESCRIBE DESCRIBE PERIOD
----------- --------- -------- -------- -------- ------
<S> <C> <C> <C> <C> <C>
YEAR ENDED DECEMBER 31, 1996:
Reserves and allowances deducted from asset accounts:
Allowance for uncollectible accounts................ -- -- -- (1) --

YEAR ENDED DECEMBER 31, 1997:
Reserves and allowances deducted from asset accounts:
Allowance for uncollectible accounts................ -- -- -- (1) --

YEAR ENDED DECEMBER 31, 1998:
Reserves and allowances deducted from asset accounts:
Allowance for uncollectible accounts................ -- $69,000 -- (1) $69,000
</TABLE>

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

(1) Uncollectible accounts written off, net of recoveries.

S-2

<PAGE>

EXHIBIT 23.1

CONSENT OF INDEPENDENT AUDITORS

We consent to the references to our firm under the captions 'Experts' and
'Selected Financial Data' and to the use of our reports dated November 5, 1999,
in the Registration Statement (Form S-1) and related Prospectus of OnSite
Access, Inc. for the registration of shares of its common stock.

ERNST & YOUNG LLP

New York, New York
December 13, 1999

<ARTICLE> 5
<MULTIPLIER> 1,000

<S> <C> <C>
<PERIOD-TYPE> YEAR 9-MOS
<FISCAL-YEAR-END> DEC-31-1998 DEC-31-1999
<PERIOD-START> JAN-01-1998 JAN-01-1999
<PERIOD-END> DEC-31-1998 SEP-30-1999
<CASH> 922 18,575
<SECURITIES> 0 0
<RECEIVABLES> 443 1,118
<ALLOWANCES> 69 217
<INVENTORY> 0 0
<CURRENT-ASSETS> 1,321 19,716
<PP&E> 2,570 16,338
<DEPRECIATION> 336 1,486
<TOTAL-ASSETS> 4,224 37,222
<CURRENT-LIABILITIES> 1,586 5,169
<BONDS> 563 2,728
<COMMON> 0 10
0 0
0 47,338
<OTHER-SE> (4,548) (17,950)
<TOTAL-LIABILITY-AND-EQUITY> 4,224 37,222
<SALES> 0 0
<TOTAL-REVENUES> 944 2,317
<CGS> 0 0
<TOTAL-COSTS> 634 1,763
<OTHER-EXPENSES> 4,300 16,479
<LOSS-PROVISION> 69 148
<INTEREST-EXPENSE> 388 1,063
<INCOME-PRETAX> (4,928) (17,337)
<INCOME-TAX> 0 0
<INCOME-CONTINUING> 0 0
<DISCONTINUED> 0 0
<EXTRAORDINARY> 0 0
<CHANGES> 0 0
<NET-INCOME> (4,928) (17,337)
<EPS-BASIC> (1.19) (4.06)
<EPS-DILUTED> (1.19) (4.06)