C TEC CORP
S-3/A, 1994-11-10
TELEPHONE COMMUNICATIONS (NO RADIOTELEPHONE)
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As filed with the Securities and Exchange Commission on November 10, 1994
                                                Registration No. 33-54433
    
==============================================================================




                      SECURITIES AND EXCHANGE COMMISSION
                            WASHINGTON, D.C. 20549

                             -----------------
   
                                Amendment No. 5
    
                                      to
                                   FORM S-3
                            REGISTRATION STATEMENT
                                     UNDER
                          THE SECURITIES ACT OF 1933

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

                               C-TEC CORPORATION
            (Exact name of Registrant as specified in its charter)

             Pennsylvania                          23-2093008
    (State or other jurisdiction of             (I.R.S. Employer
    incorporation or organization)             Identification No.)


                            105 Carnegie Center
                            Princeton, NJ 08540
                              (609) 734-3700
            (Address, including zip code, and telephone number,
      including area code of Registrant's principal executive offices)

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

                            Raymond B. Ostroski
                    Vice President and General Counsel
                             C-TEC Corporation

                            105 Carnegie Center
                            Princeton, NJ 08540
                              (609) 734-3700
         (Name, address, including zip code, and telephone number,
                including area code, of agent for service)


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


                                 Copy to:
                             Peter R. Douglas
                           Davis Polk & Wardwell
                           450 Lexington Avenue
                         New York, New York 10017
                              (212) 450-4000

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

      Approximate date of commencement of proposed sale to the public:  As
soon as practicable after the effective date of this Registration Statement.
      If the only securities being registered on this Form are being offered
pursuant to dividend or interest reinvestment plans, please check the
following box. ( )
      If any of the securities being registered on this Form are to be offered
on a delayed or continuous basis pursuant to Rule 415 under the Securities Act
of 1933, other than securities offered only in connection with dividend or
interest reinvestment plans, check the following box. ( )

                             -----------------
   
      THIS REGISTRATION AGREEMENT SHALL HEREAFTER BECOME EFFECTIVE IN
ACCORDANCE WITH THE PROVISIONS OF SECTION 8(a) OF THE SECURITIES ACT OF
1933.
    

PROSPECTUS (Subject to Completion)                                      [LOGO]
   
Issued November 10, 1994
    


                               14,858,634 Shares
                               C-TEC Corporation
                                 Common Stock


   
     C-TEC Corporation, a Pennsylvania corporation (the "Company"), is
distributing to holders of record of shares of its Common Stock, par value
$1.00 per share (the "Common Stock"), and to holders of record of shares of
its Class B Common Stock, par value $1.00 per share (the "Class B Stock",
and collectively with the Common Stock, the "Company Stock"), transferable
subscription rights (the "Rights") to subscribe for and purchase additional
shares of the Common Stock for a price of $[ ] per share (the "Subscription
Price").  Such shareholders will receive nine Rights for every ten shares of
Company Stock held by them as of the close of business on November 10, 1994
(the "Record Date").  No fractional Rights or cash in lieu thereof will be
distributed or paid by the Company.  The number of Rights distributed by
the Company to each record holder (a "Holder") of Company Stock will be
round ed up to the nearest whole number.  Rights holders may purchase one
share of Common Stock for each whole Right held.  Each Right also carries
the right to subscribe (the "Oversubscription Privilege") at the
Subscription Price for shares of Common Stock that are not otherwise
purchased pursuant to the exercise of Rights.  See "The Rights
Offering--Subscription Privileges--Oversubscription Privilege." The Rights
will be evidenced by transferable certificates.  Once a holder has
exercised any Rights, such exercise may not be revoked.  There can be no
assurance that the Company will receive any proceeds from the exercise of
the Rights.


    
   
     The Rights will expire at 5:00 p.m., New York City time, on December
1, 1994, unless extended (as it may be extended, the "Expiration Date").
Shareholders who do not exercise or sell their Rights will relinquish the
value inherent in the Rights.  Accordingly, shareholders are strongly urged
to exercise or sell their Rights.  See "Investment Considerations--
Dilution."

     As of November 10, 1994, RCN Corporation, a Delaware corporation
("RCN"), owns directly or indirectly, 600,768 shares of Common Stock,
representing 7.5% of the outstanding Common Stock, and 5,094,223 shares of
Class B Stock, representing 59.6% of the outstanding Class B Stock.  RCN
will receive 5,125,492 Rights in respect of the shares of Company Stock it
owns, and such Rights represent 34.5% of the total Rights to be
distributed.  RCN has informed the Company that it intends to exercise the
Rights it receives for an aggregate subscription price of $[ ] and that it
intends to exercise the Oversubscription Privilege for an aggregate
subscription price of approximately $50,000,000 to subscribe for [ ]
additional shares of Common Stock.  The opportunity to exercise the
Oversubscription Privilege is available to all holders of rights on the
same terms.  RCN does not intend to purchase any additional Rights through
open market purchases or otherwise.  The Common Stock has less voting power
per share than the Class B Stock.  See "Description of Capital Stock--
Voting Rights and Powers." As a result of its ownership of 59.6% of the
Class B Stock and 7.5% of the Common Stock, RCN has, and after the Rights
Offering will have, effective control of the Company.
    

     The principal market for the Common Stock is The NASDAQ Stock Market's
National Market ("NASDAQ").  It is anticipated that the Rights will trade
on NASDAQ under the symbol "CTEXR." Certain registered broker-dealers have
indicated to the Company that they intend to make a market in the Rights.
There can be no assurance, however, that a market for the Rights will
develop.  Rights may also be sold in over-the-counter and private sales
transactions.  Orders to sell Rights must be received by the Subscription
Agent (as hereinafter defined) not later than 11:00 a.m. on November 23,
1994, if a holder wishes to sell Rights through the Subscription Agent.  On
June 30, 1994, the last day on which trade prices were reported prior to
the public announcement of the Rights Offering, the closing sale price of
the Common Stock on NASDAQ was $25.25 per share.  On November 10, 1994, the
closing sale price of the Common Stock on NASDAQ was $[ ] per share.

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


   THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES
    AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION, NOR HAS THE
     SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION
         PASSED UPON THE ACCURACY OR ADEQUACY OF THIS PROSPECTUS.  ANY
             REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.


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


     SHAREHOLDERS WHO DO NOT EXERCISE THEIR RIGHTS IN FULL WILL EXPERIENCE
      DILUTION IN THEIR RELATIVE PERCENTAGE OWNERSHIP IN THE COMPANY UPON
     ISSUANCE OF THE COMMON STOCK TO SHAREHOLDERS EXERCISING THEIR RIGHTS.


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


    BEFORE MAKING AN INVESTMENT DECISION, POTENTIAL INVESTORS SHOULD CARE-
      FULLY CONSIDER THE FACTORS SET FORTH IN "INVESTMENT CONSIDERATIONS"
       IN ADDITION TO THE OTHER INFORMATION CONTAINED IN THIS PROSPECTUS


                                     Underwriting Discounts    Proceeds to the
                  Price to Public      and Commissions (1)        Company(2)
                  ---------------    ----------------------    ---------------

Per Share.....   $                           N/A                $
Total.........   $                           N/A                $

   
(1)   See "Plan of Distribution" for information with respect to contingent
      fees payable by the Company.
(2)   Before deduction of estimated expenses of $1,325,000 payable by the
      Company, including registration fees, listing fees, NASD review fees,
      financial advisory, legal and accounting fees, subscription agent
      fees, information agent fees, soliciting dealer fees, printing
      expenses and other miscellaneous fees and expenses.

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

             The date of this Prospectus is November 10, 1994.
    

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

                             AVAILABLE INFORMATION

      The Company is subject to the informational requirements of the
Securities Exchange Act of 1934, as amended (the "Exchange Act"), and in
accordance therewith files reports, proxy statements and other information
with the Securities and Exchange Commission (the "Commission").  Reports,
proxy statements and other information filed by the Company can be inspected
and copied at the public reference facilities maintained by the Commission at
Room 1024, 450 Fifth Street, N.W., Washington, D.C. 20549 and at the Regional
Offices of the Commission located at 7 World Trade Center, 13th Floor, New
York, New York 10048 and Northwest Atrium Center, 500 West Madison Street,
Chicago, Illinois 60661.  Copies of such material can be obtained upon written
request addressed to the Public Reference Section of the Commission at 450
Fifth Street, N.W., Washington D.C. 20549, at prescribed rates.  The Company's
Common Stock is quoted on NASDAQ and such reports, proxy statements and other
information can also be inspected at the offices of NASDAQ Operations, 1735 K
Street, N.W., Washington, D.C. 20006.

      The Company has filed with the Commission a Registration Statement on
Form S-3 (together with any amendments thereto, the "Registration Statement")
under the Securities Act of 1933, as amended (the "Securities Act"), with
respect to the shares of Common Stock issuable upon exercise of the Rights.
This Prospectus does not contain all the information set forth in the
Registration Statement.  Such additional information may be obtained from the
Commission's principal office in Washington, D.C.  Statements contained in
this Prospectus or in any document incorporated in this Prospectus by
reference as to the contents of any contract or other document referred to
herein or therein are not necessarily complete, and, in each instance,
reference is made to the copy of such contract or other document filed as an
exhibit to the Registration Statement or such other document, each such
statement being qualified in all respects by such reference.

                      DOCUMENTS INCORPORATED BY REFERENCE

   
      The following documents filed by the Company (File No. 0-11053) with
the Commission pursuant to Section 13 of the Exchange Act are incorporated
herein by reference:  (i) the Company's Annual Report on Form 10-K for the
fiscal year ended December 31, 1993, as amended on October 28, 1994 and as
further amended on November 10, 1994, (ii) the Company's Proxy Statement
dated March 15, 1994, (iii) the Company's Quarterly Report on Form 10-Q for
the quarter ended March 31, 1994, as amended on October 28, 1994, (iv) the
Company's Quarterly Report on Form 10-Q for the six months ended June 30,
1994, as amended on October 28, 1994, (v) the Company's Current Report on
Form 8-K dated September 26, 1994 and (vi) the Company's Current Report on
Form 8-K dated October 27, 1994, as amended on November 10, 1994.
    

      All documents filed by the Company pursuant to Section 13(a), 13(c), 14
or 15(d) of the Exchange Act subsequent to the date of this Prospectus and
prior to the termination of the offering of the Common Stock shall be deemed
to be incorporated by reference into this Prospectus and to be a part hereof
from the date of filing of such documents.  Any statement contained in a
document incorporated or deemed to be incorporated by reference herein shall
be deemed to be modified or superseded for purposes of this Prospectus to the
extent that a statement contained herein or in any other subsequently filed
document which is also deemed to be incorporated by reference herein modifies
or supersedes such statement.  Any such statement so modified or superseded
shall not be deemed, except as so modified or superseded, to constitute a part
of this Prospectus.

      This Prospectus incorporates documents by reference which are not
presented herein or delivered herewith.  The Company will provide without
charge to each person, including each beneficial owner, to whom a copy of this
Prospectus has been delivered, on the written or oral request of such person,
a copy of any or all documents referred to above which have been incorporated
by reference into this Prospectus except the exhibits to such documents unless
such exhibits are specifically incorporated by reference into the information
that the Prospectus incorporates.  Telephone requests for such copies should
be directed to the Information Agent at (212) 929-5500 or (800) 322-2885, or,
if made in writing, to MacKenzie Partners, Inc., 156 Fifth Avenue, 9th Floor,
New York, NY 10010.  Such requests may also be directed to Raymond B.
Ostroski, Vice President and General Counsel at (609) 734-3803 or, if made
in writing, to C-TEC Corporation, 105 Carnegie Center, Princeton, NJ 08540
attention:  Raymond B.  Ostroski, Vice
President and General Counsel.

                              PROSPECTUS SUMMARY

            The following material is qualified in its entirety by the
information appearing elsewhere in this Prospectus and in the documents
incorporated in this Prospectus by reference.

                                  THE COMPANY

      The Company was organized in 1979 and is incorporated under the laws of
the Commonwealth of Pennsylvania.  The Company is a holding company with
wholly owned subsidiaries which are engaged in various aspects of the
telecommunications industry and which are organized into five principal groups
- - Telephone, Cable, Communications Services, Mobile Services, and Long
Distance.  Through its wholly owned subsidiaries, the Company also has
ownership interests in a number of other entities providing telecommunications
services.

      The Telephone Group consists of a Pennsylvania public utility providing
local telephone service to a 19 county, 5,067 square mile service territory in
Pennsylvania.  As of June 30, 1994, the Telephone Group serviced approximately
215,000 main access lines.  Of these 168,000 were residential and 47,000 were
primarily related to business.  This Group's operating territory is rural,
containing only 42.4 access lines per square mile as compared to a
Pennsylvania average of approximately 151 lines per square mile.  The Group's
79 central offices serve an average of approximately 2,700 lines and 65 square
miles.

      The Cable Group is a cable television operator with cable television
systems located in the States of New York, New Jersey, Michigan and Delaware.
The Group owns and operates cable television systems serving approximately
236,000 customers and manages cable television systems with an additional
36,000 customers, ranking it among the top 35 multiple system operators in the
United States. On October 12, 1994 the Company announced the pending
acquisition of a Pennsylvania cable television provider, Twin County Trans
Video, Inc. ("Twin County"). For information on the pending acquisition
and pro forma effect of such acquisition, see "Recent Developments" and
"Pro Forma Condensed Consolidated Financial Statements," respectively.

   
      The Communications Services Group presently carries out business
principally in the Northeastern United States providing telecommunications
related engineering and technical services.  The Group headquarters is
located in Princeton, New Jersey and the services are provided out of
regional offices in Pennsylvania, New York, New Jersey and Virginia.
    

      The Mobile Services Group previously operated cellular telephone systems
in metropolitan statistical areas ("MSAs") and rural statistical areas
("RSAs") throughout eight counties in Northeastern and Central Pennsylvania
and 24 counties in Southeast Iowa, serving a total population of 1.5 million.
On September 9, 1994, the Company completed the sale of its cellular
properties to Independent Cellular Network, Inc. ("ICN") for approximately
$182.5 million, subject to certain adjustments to be made within 90 days
after closing estimated to result in approximately $7 million of additional
proceeds.  For information on the pro forma effect of such sale, see "Pro
Forma Condensed Consolidated Financial Statements." The Group also operates
paging and message management services in Northeastern Pennsylvania.  These
business units were not sold to ICN as part of the cellular sale.

      The Long Distance Group principally operates in Pennsylvania.  The Group
began operations in 1990 by servicing the local service area of the Telephone
Group.  In late 1992, the Long Distance Group entered the
Wilkes-Barre/Scranton territory served by Bell Atlantic.  In late 1993, the
Group established sales offices in additional markets in Philadelphia,
Pittsburgh, Harrisburg and Allentown.  The primary focus in these markets is
providing service to residential and business customers.

      The Company believes that the long term competitiveness of
telecommunications systems will be based upon the capacity to provide voice,
video and data services over a single network (a "Full Service Network").
Although still in the formative stages, Full Service Networks will combine key
attributes of the cable television and telephone networks including the high
capacity of cable television networks and the access to switching of telephone
networks.  The Company believes that because of its experience in the design,
construction and operation of both telephone and cable television systems, it
is well positioned to implement competitive Full Service Networks designed
around such systems or other platforms.  The Company intends to develop Full
Service Networks utilizing certain of the Company's cable television and
telephone systems  or other platforms (such as leased or overbuilt
facilities), to expand the footprint available for upgrade through
acquisitions, joint ventures and similar strategic investments, to implement
these expanded services at an early stage relative to its competitors and to
explore opportunities to expand its business into international markets.

      On or about October 29, 1993, RCN acquired 600,768 shares of Common
Stock and 5,094,223 shares of Class B Stock of the Company from a group
consisting of Andrew J. Sordoni III, William B. Sordoni, Stephen Sordoni and
Charles E. Parente (including entities wholly owned or controlled by any one
or more of them) (the "Sellers") pursuant to the terms of the Stock Purchase
Agreement dated June 17, 1993 among the Sellers, RCN and Kiewit Diversified
Group, Inc.  The purchase price paid by RCN was $202,327,191 and the source of
such funds was RCN's and its affiliates' working capital.  This transaction
represented approximately 34% of the equity and approximately 57% of the
voting control of the Company.  RCN nominees currently constitute a majority
of the Board of Directors of the Company.

   
      The Company's principal executive offices are located at 105 Carnegie
Center Princeton, NJ 08540 (telephone:(609) 734-3700).
    

                              THE RIGHTS OFFERING

   
Rights.................  Each Holder of Company Stock will receive nine
                           transferable Rights for every ten shares of
                           Company Stock held of record on November 10,
                           1994 (the "Record Date").  The number of Rights
                           distributed by the Company to each Holder of
                           Company Stock will be rounded up to the nearest
                           whole number.  An aggregate of approximately
                           14,858,634 Rights will be distributed pursuant
                           to the Rights Offering.  Each Right will be
                           exercisable for one share of Common Stock.  An
                           aggregate of approximately 14,858,634 shares of
                           Common Stock (the "Underlying Shares") will be
                           sold upon exercise of the Rights assuming
                           exercise of all Rights.  The distribution of the
                           Rights and sale of Underlying Shares is referred
                           to herein as the "Rights Offering." See "The
                           Rights Offering--The Rights."
    

Basic Subscription
  Privilege............  Rights holders are entitled to purchase for the
                           Subscription Price one share of Common Stock for
                           each whole Right held (the "Basic Subscription
                           Privilege").  See "The Rights
                           Offering--Subscription Privileges--Basic
                           Subscription Privilege."

Oversubscription
  Privilege............  Each holder of Rights who elects to exercise in full
                           his or her Basic Subscription Privilege may also
                           subscribe at the Subscription Price for additional
                           Underlying Shares available as a result of
                           unexercised Rights, if any (the "Oversubscription
                           Privilege").  If an insufficient number of
                           Underlying Shares is available to satisfy fully all
                           elections to exercise the Oversubscription
                           Privilege, the available Underlying Shares will be
                           prorated among holders who exercise their
                           Oversubscription Privilege based on the respective
                           numbers of Rights exercised by such holders
                           pursuant to the Basic Subscription Privilege.  See
                           "The Rights Offering--Subscription
                           Privileges--Oversubscription Privilege."

Subscription Price.....  $[   ] in cash per share of Common Stock subscribed
                           for pursuant to the Basic Subscription Privilege or
                           the Oversubscription Privilege.

   
Shares of Common Stock
  Outstanding after
  Rights Offering......  Approximately 22,820,900 shares, based on the
                           number of shares outstanding on November 10, 1994
                           and assuming exercise of all Rights.

Intent of RCN..........  RCN has informed the Company that it intends to
                           exercise the 5,125,492 Rights it will receive in
                           respect of the shares of Company Stock currently
                           owned by RCN for an aggregate subscription price
                           of $_______ and that it intends to exercise the
                           Oversubscription Privilege for an aggregate
                           subscription price of approximately $50,000,000
                           to subscribe for [     ] additional shares of
                           Common Stock. The opportunity to exercise the
                           Oversubscription Privilege is available to all
                           holders of Rights on the same terms. See "The
                           Rights Offering--Subscription Privileges--
                           Oversubscription Privilege."
                           RCN does not intend to purchase any additional
                           Rights through open market purchases or otherwise.
    

Transferability
  of Rights............  The Rights are transferable, and it is anticipated
                           that they will trade on NASDAQ under the symbol
                           "CTEXR."  Certain registered broker-dealers have
                           indicated that they intend to make a market in the
                           Rights during the period the Rights are
                           outstanding.  No assurance can be given, however,
                           that a market for the Rights will develop or, if
                           such a market develops, how long it will continue.

                         The Subscription Agent will endeavor to sell Rights
                           for holders who deliver a Subscription Certificate
                           with the instruction for sale properly executed to
                           the Subscription Agent by 11:00 a.m., New York City
                           time, on November 23, 1994.  See "The Rights
                           Offering--Method of Transferring Rights."

Record Date............  November 10, 1994.

   
Expiration Date........  December 1, 1994, at 5:00 p.m., New York City
                         time, unless extended.
    

Procedure for Exer-
  cising Rights........  Basic Subscription Privileges and Oversubscription
                           Privileges may be exercised by properly
                           completing and signing the Subscription Certificate
                           evidencing the Rights (a "Subscription
                           Certificate") and forwarding such Subscription
                           Certificate (or following the Guaranteed Delivery
                           Procedures), with payment of the Subscription Price
                           for each Underlying Share subscribed for pursuant
                           to the Basic Subscription Privilege and the
                           Oversubscription Privilege, to the Subscription
                           Agent on or prior to the Expiration Date.  Any
                           Rights holder subscribing for an aggregate of more
                           than 5000 Underlying Shares pursuant to the
                           Oversubscription Privilege prior to the Expiration
                           Date shall not be required to deliver payment for
                           such number of Underlying Shares in excess of 5000
                           until the Expiration Date.  The Company, in its sole
                           discretion, may determine to waive payment for such
                           number of Underlying Shares in excess of 5000
                           subscribed for pursuant to the Oversubscription
                           Privilege until after the Expiration Date and after
                           all prorations and adjustments contemplated by the
                           terms of the Rights Offering have been effected.
                           If the mail is used to forward Subscription
                           Certificates, it is recommended that insured,
                           registered mail be used.  No interest will be paid
                           on funds delivered in payment of the Subscription
                           Price.

                         Once a holder of Rights has exercised the Basic
                           Subscription Privilege or the Oversubscription
                           Privilege, such exercise may not be revoked.
                           See "The Rights Offering--Exercise of Rights."

   
Procedure for Exer-
cising Rights by
Foreign and Certain
Other Shareholders....   Subscription Certificates will not be mailed to
                           Holders of Company Stock whose addresses are
                           outside the United States or who have an APO or
                           FPO address, but will be held by the
                           Subscription Agent for their account.  To
                           exercise such Rights, such a Holder must notify
                           the Subscription Agent on or prior to 11:00
                           a.m., New York City time, on November 23, 1994,
                           and must establish to the satisfaction of the
                           Subscription Agent that such exercise is
                           permitted under applicable law.  If such a Holder
                           does not notify the Subscription Agent and
                           provide acceptable instructions to the Subscription
                           Agent by such time, such Rights will be sold,
                           if feasible, and the net proceeds, if any, remitted
                           to such Holder.  See "The Rights Offering--Foreign
                           and Certain other Shareholders."
    

Persons Holding Shares,
  or Wishing to Exer-
  cise Rights, Through
  Others...............  Persons holding shares of Company Stock and receiving
                           the Rights distributable with respect thereto,
                           through a broker, dealer, commercial bank, trust
                           company or other nominee, as well as persons
                           holding certificates of Company Stock personally
                           who would prefer to have such institutions
                           effect transactions relating to the Rights on
                           their behalf, should contact the appropriate
                           institution or nominee and request it to effect
                           the transactions for them.  See "The Rights
                           Offering--Exercise of Rights."

Issuance of Common
  Stock................  Certificates representing shares of Common Stock
                           purchased pursuant to the Basic Subscription
                           Privilege will be delivered to subscribers as soon
                           as practicable after the corresponding Rights have
                           been validly exercised and full payment for shares
                           has been received and cleared.  For shares
                           purchased pursuant to the Oversubscription
                           Privilege, delivery of certificates will occur as
                           soon as practicable after the Expiration Date and
                           after all prorations and adjustments contemplated
                           by the terms of the Rights Offering have been
                           effected.  See "The Rights Offering--Subscription
                           Privileges."

   
Use of Proceeds........  The net cash proceeds received by the Company from
                           the sale of the shares of Common Stock offered
                           hereby, after payment of fees and expenses, would
                           be approximately [$300] million, assuming full
                           exercise of the Rights.  The Rights Offering is,
                           however, not conditioned upon any minimum level of
                           exercise of the Rights, and there can be no
                           assurance that the Company will raise any proceeds
                           from the Rights Offering.  RCN has, however,
                           informed the Company that it intends to exercise
                           the Rights it receives for an aggregate
                           subscription price of $[     ] and  that it intends
                           to exercise the Oversubscription Privilege for
                           an aggregate subscription price of approximately
                           $50,000,000 to subscribe for [     ] additional
                           shares of Common Stock. The opportunity to
                           exercise the Oversubscription Privilege is
                           available to all holders of Rights on the same
                           terms. See "The Rights Offering--Subscription
                           Privileges--Oversubscription Privilege."
                           RCN does not intend to purchase any additional
                           Rights through open market purchases or otherwise.
                           The net proceeds, if any, from the Rights Offering
                           will be used for general corporate purposes.
                           Specifically, the Company expects that such
                           proceeds, together with the proceeds from the
                           recently completed sale of the Company's
                           cellular properties, will be used primarily (i)
                           to finance the pending acquisition of Twin
                           County, (ii) to prepay $100,000,000 in aggregate
                           principal amount of the Company's 9.52% Senior
                           Secured Notes due December 1, 2001 (the "Senior
                           Secured Notes"), (iii) to develop Full Service
                           Networks utilizing certain of the Company's
                           cable television and telephone systems or other
                           platforms (such as leased or overbuilt
                           facilities) and (iv) for potential acquisitions,
                           joint ventures and similar strategic investments
                           in the telecommunications industry.  Prior to
                           the consummation of the Rights Offering, the
                           Company may prepay the Senior Secured Notes by
                           entering into a short term revolving credit
                           facility on terms the Company believes are
                           favorable and then repay such short term credit
                           facility with the proceeds of the Rights
                           Offering.  See "Recent Developments," "Use of
                           Proceeds" and "Corporate Strategy."
    

Subscription Agent.....  The First National Bank of Boston.  See "Subscription
                           Agent."

Information Agent......  MacKenzie Partners, Inc.  See "Information Agent."

Investment Consider-
  ations...............  There are substantial risks in connection with this
                           offering that should be considered by prospective
                           purchasers.  See "Investment Considerations."

                 SELECTED FINANCIAL AND OPERATING INFORMATION

   
The following selected historical financial information as of and for the
periods ended June 30, 1994 and June 30, 1993 is unaudited but, in the
opinion of the Company's management, includes all recurring adjustments
necessary for a fair presentation of the results of operations for such
periods.  Information as of and for the six months ended June 30, 1994 and
June 30, 1993 has been derived from, and should be read in conjunction
with, the Company's unaudited consolidated condensed financial statements
for such periods, which are included in the Company's Quarterly Report on
Form 10-Q for the six months ended June 30, 1994, as amended on October 28,
1994, which report is incorporated by reference in this Prospectus.  The
results for such interim periods are not necessarily indicative of the
results for the full fiscal year.  The information as of and for the three
fiscal years ended December 31, 1993 has been derived from, and should be
read in conjunction with, the Company's Consolidated Financial Statements
for the three fiscal years ended December 31, 1993, which have been audited
by independent public accountants and are included in the Company's Annual
Report on Form 10-K for the fiscal year ended December 31, 1993, as amended
on October 28, 1994, and as further amended on November 10, 1994, which
report is incorporated by reference in this Prospectus and the Company's
consolidated financial statements for the three fiscal years ended December
31, 1992 which have been audited by independent public accountants and are
included in the Company's Annual Report on Form 10-K for the fiscal year
ended December 31, 1992 as previously filed with the Commission.  The
information with respect to the fiscal years ended December 31, 1990 and
December 31, 1989 has been derived from, and should be read in conjunction
with, the Company's Consolidated Financial Statements for the three fiscal
years ended December 31, 1992, 1991 and 1990, which have been audited by
independent public accountants and are included in the Company's Annual
Reports on Form 10-K for the fiscal years ended December 31, 1992, 1991 and
1990, respectively, as previously filed with the Commission.
    

                     Summary Financial and Operating Data
          (dollars in thousands except per share and operating data)
<TABLE>
<CAPTION>
                                                                                                             Six Months Ended
                                                                   Year Ended December 31,                      June 30,(1)
                                              -----------------------------------------------------------    ------------------
                                                1989(2)       1990        1991        1992         1993       1993        1994
                                              ---------    ---------   ---------    ---------    --------    -------    -------
<S>                                           <C>          <C>         <C>          <C>          <C>         <C>        <C>
Consolidated Statement of Operations Data:
 Sales....................................    $161,005     $200,383    $232,818     $256,564     $283,987   $138,230   $145,114
 Operating income before depreciation
  and amortization........................      65,386       80,638      89,738      105,370      107,644     55,805     58,253
 Depreciation and amortization............      43,673       62,712      78,145       75,289       73,103     36,927     36,690
 Operating income.........................      21,713       17,926      11,593       30,081       34,541     18,879     21,563
 Interest income..........................       1,721        1,321       1,801        2,178        1,609        839      1,250
 Interest expense.........................     (14,632)     (31,889)    (37,472)     (37,321)     (34,204)   (17,147)   (16,333)
 Other income (expense)...................         (11)      (1,242)        685          291        1,408        152        613
 Income (loss) before income taxes........       8,791      (13,884)    (23,393)       1,303        5,342      4,711      7,986
 Provision (benefit) for income taxes.....       3,903       (3,782)     (5,486)       3,284       10,714      4,465      3,973
 Income (loss) before minority interest
  and equity in unconsolidated
  entities................................       4,888      (10,102)    (17,907)      (1,981)      (5,372)       246      4,013
 Income (loss) from continuing operations
  before cumulative effect of
  accounting principle changes............       5,787       (9,594)    (19,415)      (2,061)      (5,486)       279      3,818(3)
 Cumulative effect of changes in
  accounting principles...................          --           --          --           --       (1,163)    (1,163)      (393)
 Net income (loss)........................       4,460       (9,943)    (12,392)      (2,061)      (6,649)      (884)       564
 Net income (loss) per share..............         .27         (.60)       (.75)        (.13)        (.40)      (.05)       .03
 Capital expenditures.....................      52,146       69,657      55,050       51,207       59,142     34,212     27,162
Cable(4):
 Sales....................................      35,868       63,925      76,128       85,299       93,550     46,262     47,402
 Operating expenses(5)....................      37,358       72,747      80,589       85,070       90,931     44,294     44,925
 Operating income before depreciation
  and amortization(5).....................      14,807       28,056      35,401       40,937       44,328     22,784     23,394
 Depreciation and amortization............      16,297       36,878      39,862       40,708       41,709     20,816     20,917
Telephone:
 Sales....................................     110,834      113,104     119,310      123,039      125,293     62,617     61,129
 Operating expenses(5)....................      70,485       71,424      75,599       71,360       75,580     39,214     36,212
 Operating income before depreciation
  and amortization(5).....................      63,481       63,621      67,057       72,285       72,465     35,256     36,413
 Depreciation and amortization............      23,132       21,941      23,346       20,606       22,752     11,853     11,496
Mobile Services:(6)
 Sales....................................       6,466       10,753      13,993       18,687       24,810     10,912     15,165
 Operating expenses(5)....................      10,670       13,551      25,956       27,723       26,354     11,559     13,804
 Operating income (loss) before
  depreciation and amortization(5)........        (933)        (550)      1,442        3,552        5,590      2,931      4,851
 Depreciation and amortization............       3,271        2,248      13,405       12,588        7,134      3,578      3,490
Communication Services:
 Sales....................................       7,837       10,941      14,325       14,015       18,895      8,363      8,931
 Operating expenses(5)....................       8,860       14,425      17,815       15,118       19,923      8,828      9,369
 Operating income (loss) before
  depreciation and amortization(5)........        (924)      (3,351)     (3,287)        (891)        (649)      (299)      (276)
 Depreciation and amortization............          99          133         203          212          379        166        162
Long Distance:
 Sales....................................           -        1,660       9,062       15,445       21,383     10,044     12,470
 Operating expenses(5)....................           -        2,449      10,378       16,957       25,041     10,945     16,000
 Operating income (loss) before
  depreciation and amortization(5)........           -         (742)       (888)      (1,163)      (3,232)      (737)    (3,290)
 Depreciation and amortization............           -           47         428          349          426        164        240
________________________________
<FN>

  (1)  Unaudited.
  (2)  Restated to reflect a disposition accounted for as a
       discontinued operation.
  (3)  Excludes extraordinary charge of $2,861 for
       debt prepayment penalty.
  (4)  Excludes the effects of the Company's pending acquisition of Twin
       County. For information on the pro forma effect of such pending
       acquisition, see "Pro Forma Condensed Consolidated Financial
       Statements."
  (5)  Fiscal 1989 amounts have been restated to conform to the presentation in
       fiscal years 1990 through 1993 which excludes the effects of
       allocated general corporate expenses on operating income (loss)
       before depreciation and amortization and on operating expenses.
  (6)  On September 9, 1994, the Company completed the sale of its cellular
       properties to ICN for approximately $182,500, subject to certain
       adjustments to be made within 90 days after closing estimated to
       result in approximately $7 million additional proceeds. For
       information on the pro forma effect of such sale, see "Pro Forma
       Condensed Consolidated Financial Statements."
</TABLE>

<TABLE>
<CAPTION>
                                                                      December 31,                               June 30,(1)
                                             ------------------------------------------------------------    ------------------
                                                1989          1990        1991        1992         1993       1993        1994
                                             ----------    ---------   ---------    ---------    --------    -------    -------
<S>                                         <C>          <C>         <C>          <C>         <C>         <C>          <C>
Balance Sheet Data:
 Cash and temporary cash investments.......     6,306       24,057      49,636       58,837      60,182       57,063      47,328
 Total assets..............................   486,850      580,429     596,000      586,366     579,564      620,825     570,865
 Long term debt............................   268,290      364,970     432,482      421,780     409,293      415,310     386,187
 Common shareholders' equity...............    92,591       77,932      69,009       66,824      60,363       65,789      60,927
Operating Data:(1)
Cable Systems(2):
 Homes passed..............................   286,289      322,755     334,461      343,871     354,035      349,209     355,595
 Basic Subscribers (approximate)(3)........   175,000      197,000     207,000      218,000     224,000      228,000     236,000
 Premium revenue per average
  subscriber per month.....................     $7.75        $7.37       $6.61        $6.31       $6.01        $5.97       $5.52
Telephone:
 Access lines - business (approximate).....    32,000       37,000      38,000       41,000      44,000       42,000      47,000
 Access lines - residential
  (approximate)............................   152,000      157,000     160,000      163,000     167,000      165,000     168,000
 Access lines total (approximate)..........   184,000      194,000     198,000      204,000     211,000      207,000     215,000
 Average daily carrier access
   minutes of use(4)....................... 1,705,313    1,789,721   1,884,622    1,940,051   2,146,046    2,088,263   2,324,579
 Telephone employees.......................       763          665         635          610         608          616         609
 Telephone employees per 10,000
   access lines............................     41.47        34.28       32.07        29.90       28.82        29.76       28.33
________________________________
<FN>

  (1)  Unaudited.
  (2)  Excludes the effects of the Company's pending acquisition of Twin
       County.
  (3)  A home with one or more television sets connected
       to a cable television system is counted as one basic subscriber.
  (4)  Access minute data was derived from the Telephone Group's revenue
       system for all toll jurisdictions and divided by 365 to determine
       average daily usage.
</TABLE>


                             INVESTMENT CONSIDERATIONS

      Each prospective purchaser should carefully examine all of the
information contained in this Prospectus and should give particular
consideration to the following risk factors:

Operating Losses

      The Company has experienced losses from continuing operations since 1990
and may incur losses from continuing operations in the future.  The Company
incurred losses of $6,649,000, $2,061,000, $19,415,000 and $9,594,000 for the
years ended December 31, 1993, 1992, 1991 and 1990, respectively.  There can
be no assurance as to when, if ever, the Company will recognize a profit from
continuing operations.

Dividend Policy and Restrictions

      Since 1989, the Company has maintained a policy of not paying cash
dividends.  The Company does not intend to alter this policy in the
foreseeable future.  Certain debt instruments to which the Company is a party
contain restrictions on the payment of cash dividends on Company Stock.

Indefinite Amount and Use of Proceeds

   
      The net cash proceeds from the Rights Offering after payment of fees and
expenses would be approximately [$300] million, assuming full exercise of all
Rights.  The Rights Offering is, however, not conditioned upon any minimum
level of exercise of the Rights.  Consequently, there can be no assurance that
the Company will raise any proceeds from the Rights Offering.  RCN has,
however, informed the Company that it intends to exercise the Rights it
receives for an aggregate subscription price of $[   ] and that it intends to
exercise the Oversubscription Privilege for an aggregate subscription price
of approximately $50,000,000 to subscribe for [ ] additional shares of
Common Stock.  RCN does not intend to purchase any additional Rights
through open market purchases or otherwise.
    

      The Company expects to use the net proceeds, if any, from the Rights
Offering to further its corporate strategy.  More specifically, the Company
expects to use such proceeds, together with the proceeds from the recently
completed sale of the Company's cellular properties, (i) to finance the
acquisition of Twin County, (ii) to prepay $100,000,000 in aggregate
principal amount of the Company's 9.52% Senior Secured Notes due December
1, 2001, (iii) to develop Full Service Networks utilizing certain of the
Company's cable television and telephone systems or other platforms (such
as leased or overbuilt facilities) and (iv) for potential acquisitions,
joint ventures and other similar strategic investments in the
telecommunications industry.  Prior to the consummation of the Rights
Offering, the Company may prepay the Senior Secured Notes by entering into
a short term revolving credit facility on terms the Company believes are
favorable and then repay such short term credit facility with the proceeds
of the Rights Offering.  See "Recent Developments," "Use of Proceeds," and
"Corporate Strategy".  The Company's plans for the establishment of such
Full Service Networks are still being developed and are subject to a number
of variables, not all of which are within the control of the Company.

      The Company's ability to grow through acquisitions, joint ventures and
similar strategic investments in the telecommunications industry will depend
on the availability of reasonably priced properties, joint venture
opportunities and investments and on the Company's ability to compete
successfully for such properties, opportunities and investments against other
companies, including companies with greater financial resources than the
Company.  Although the Company is exploring a number of possible
transactions, the Company has no commitment for any material
acquisition, joint venture or investment, other than the pending acquisition
of Twin County described in "Recent Developments," and there can be no
assurance that appropriate acquisition, joint venture and investment
opportunities will arise in the future.  The Company desires to position
itself to take advantage of strategic opportunities as they arise.  The
Company cannot predict with any degree of precision how much capital will
be needed for this purpose because of the uncertainty as to what
opportunities, if any, will arise.  If the Company does not raise adequate
capital through the Rights Offering to pursue opportunities that may arise
and that further its corporate strategy, the Company may attempt to raise
capital through other means.

      Although substantially all of the proceeds from the Rights Offering and
the cellular sale are intended to be applied toward effecting the Company's
corporate strategy, such proceeds are not otherwise being designated for any
more specific purpose.  Pending their utilization for other corporate
purposes, the Company expects to invest the proceeds from the Rights Offering
and the cellular sale primarily in Treasury obligations, money market
instruments and other similar securities.

Highly Competitive Industry

      The Company engages in various aspects of the telecommunications
industry, and certain of the businesses in which it engages are in highly
competitive sectors of the industry.  In addition, as a result of
technological, regulatory and other legal developments, the Company faces the
risk of new or increased competition in virtually all businesses in which it
engages.  Although these developments are expected to provide new
opportunities for the Company, it is not possible to predict their future
effect on the telecommunications industry in general or on the Company in
particular.

Effect of Regulation


      Most of the businesses operated by the Company are subject to extensive
regulation.  In recent years, the Company's Cable Group, like other operators
of cable television systems, has become subject to extensive regulation at the
federal, state and local levels.  Many aspects of such regulation are
currently the subject of judicial proceedings and administrative or
legislative proceedings or proposals.  On October 5, 1992, Congress passed the
Cable Television Consumer Protection and Competition Act of 1992 (the "Cable
Act") which significantly expanded the scope of regulation of certain
subscriber rates and a number of other matters in the cable industry, such as
mandatory carriage of local broadcast stations and retransmission consent, and
which will increase the administrative costs of complying with such
regulations.  On April 1, 1993, the Federal Communications Commission (the
"FCC") adopted its initial regulations on cable television rates, and on
February 22, 1994, the FCC adopted revised rate regulations that became
effective on May 15, 1994.

      The Company anticipates that certain provisions of the Cable Act that do
not relate to rate regulation -- such as the provisions relating to
retransmission consent and customer service and technical standards -- will
reduce the operating margins of the Company's Cable Group.  Otherwise, the
Company is currently unable to predict the effect that implementation of the
rate regulations and other provisions of the Cable Act will have on its
business and results of operations in future periods.  No assurance can be
given at this time that such matters will not have a material adverse effect
on the Company's business and results of operations in the future.  Also, no
assurance can be given as to what other future actions Congress, the FCC or
other regulatory authorities may take or the effects thereof on the cable
industry in general or on the Company in particular.

      The Cable Group's performance is dependent to a large extent on its
ability to obtain and renew its franchise agreements from local government
authorities on acceptable terms.  To date, all of the Group's franchises have
been renewed or extended, generally at or prior to their stated expirations
and on acceptable terms.  No assurance can be given in this regard as to
future franchise renewals.  No one franchise accounts for more than 10% of the
Group's total revenue.

      The Company's local exchange telephone subsidiary, Commonwealth
Telephone Company ("CTCo"), is subject to a rate-making process regulated by
the Pennsylvania Public Utility Commission ("PPUC").  Consequently, the
ability of the Company's Telephone Group to generate increased income and cash
flow is largely dependent on its ability to increase its subscriber base,
obtain higher message volumes and control its expenses.  During 1993, the PPUC
conducted an investigation of the appropriateness of CTCo transactions with
affiliates and analyzed the earnings of CTCo.  Following this investigation
CTCo and the PPUC entered into an agreement imposing certain requirements and
restrictions on CTCo.  Among other things, CTCo agreed to provide its
residential customers the enhancement of touch-tone service free of charge
beginning February 1, 1994.  The agreement also states that, barring
unforeseen regulatory changes, CTCo will not increase basic service rates
prior to January 1, 1997.  The PPUC has also required CTCo to permit only
income taxes actually paid to be recognized as a cost of service.
Accordingly, subsequent to December 31, 1993, the Company will not record
deferred income taxes on certain temporary differences.  These requirements
and restrictions are not expected to have a material adverse effect on the
Company.

Control by Principal Shareholder

      On most matters, including the election of directors, the holders of
Common Stock and the holders of Class B Stock vote as a class with each share
of Common Stock entitled to one vote and each share of Class B stock entitled
to 15 votes.  RCN controls over 50% of the total votes of all outstanding
shares of Company Stock.  Consequently RCN is able to elect a majority of the
members of the Board of Directors of the Company and thereby control the
Company's policies and operations.  In addition, RCN's share ownership gives
it the ability to control certain corporate actions requiring shareholder
approval.  RCN will continue to control over 50% of the total votes of all
outstanding shares of Company Stock after the Rights Offering and if no
holders of Rights other than RCN exercise their Rights, RCN will own [   ]% of
the Common Stock, 59.6% of the Class B Stock and [   ]% of the combined votes
of all Company Stock.  The control of the Company by RCN may tend to deter
nonnegotiated tender offers or other efforts to obtain control of the Company
and thereby deprive shareholders of opportunities to sell shares at prices
higher than those prevailing in the market.

Relationship with RCN; Conflicts of Interest; Noncompetition Agreement

      RCN is a subsidiary of Kiewit Diversified Group, Inc. ("KDG"), which is
a wholly owned subsidiary of Peter Kiewit Sons', Inc. ("PKS").  KDG owns 90%
of RCN, and David C. McCourt, Chairman and Chief Executive Officer of the
Company, owns the remaining 10% of RCN.  KDG owns approximately 70% of and
controls MFS Communications Company, Inc. ("MFS").  MFS provides a variety of
telecommunications services, primarily over its digital fiber optic
telecommunications networks.  Certain of the officers and directors of the
Company are also officers or directors of PKS, KDG, RCN and MFS.  As a result
of the common control of the Company and MFS, possible conflicts of interest
could arise, for example, if either the Company or MFS were presented with the
opportunity to engage in a business competing with the other or if the Company
and MFS were to enter into a business relationship together.  Potential
conflicts of interest will be dealt with on a case-by-case basis taking into
consideration relevant factors including the requirements of NASDAQ and
prevailing corporate practices.

      The Company and PKS have entered into a Noncompetition Agreement dated
as of May 26, 1993.  The Noncompetition Agreement provides, among other
things, that until the earlier to occur of (i) the tenth anniversary of the
date of the Noncompetition Agreement and (ii) the date on which PKS ceases to
own at least 30% of the issued and outstanding shares of common stock of MFS,
PKS will not, and will cause its subsidiaries and affiliates (which would
include the Company), not to compete directly or indirectly with MFS for the
provision of certain telecommunications services to business or government
users.  In addition, PKS will not, and will cause its subsidiaries not to
compete against MFS in the network systems integration and facilities
management businesses with certain limited exceptions.

Uncertain Market for Rights

      Certain registered broker-dealers have indicated to the Company that
they intend to make a market in the Rights.  No assurance can be given,
however, regarding whether a market for the rights will develop and, if one
does develop, how long it will continue or the prices at which the Rights
will trade from time to time in relation to the Common Stock.  Moreover,
because the Rights are new securities, the trading markets, if any, for the
Rights may be volatile.  There also can be no assurance that the shares of
Common Stock issuable upon exercise of the Rights will trade at or above
the Subscription Price.

Dilution

      Holders who do not exercise their Rights will experience a decrease in
their proportionate interest in the equity ownership and voting power of the
Company.  The sale of the Rights may not compensate a holder for all or any
part of any reduction in the market value of such shareholder's Company Stock
resulting from the Rights Offering.  Shareholders who do not exercise or sell
their Rights will relinquish any value inherent in the Rights.  Accordingly,
holders are strongly urged to exercise or sell their Rights.

      The Subscription Price per share of Common Stock exceeds the net
tangible book value per share of Company Stock.  Accordingly, the purchasers
of the Common Stock in the Rights Offering will experience immediate and
substantial dilution.  See "Dilution."

   
      Based on the 7,962,266 shares of Common Stock and 8,547,327 shares of
Class B Stock outstanding as of November 10, 1994, the consummation of the
Rights Offering would result (on a pro forma basis as of such date and
assuming no additional Rights are issued as a result of rounding the number
of Rights distributed to holders up to the nearest whole number) in an
increase of 14,858,634 shares of Common Stock outstanding.
    

Market Considerations

      There can be no assurance that the market price of the Common Stock
will not decline during the period the Rights are outstanding or that,
following the issuance of the Rights and the sale of the Underlying Shares
upon exercise of Rights, a subscribing Rights holder will be able to sell
shares purchased in the Rights Offering at a price equal to or greater than
the Subscription Price.  Once a holder of Rights has exercised the Basic
Subscription Privilege or the Oversubscription Privilege, such exercise may
not be revoked.  Moreover, until certificates are delivered, subscribing
Rights holders may not be able to sell the shares of Common Stock that they
have purchased in the Rights Offering.  Certificates representing shares of
Common Stock purchased pursuant to the Basic Subscription Privilege will be
delivered as soon as practicable after the corresponding Rights have been
validly exercised and full payment for the shares has been received and
cleared.  For shares purchased pursuant to the Oversubscription Privilege,
delivery of certificates will occur as soon as practicable after the
Expiration Date and after all prorations and adjustments contemplated by
the terms of the Rights Offering have been effected.

      No interest will be paid to Rights holders on funds delivered to the
Subscription Agent pursuant to the exercise of Rights pending delivery of
Underlying Shares.


                                USE OF PROCEEDS

   
      The net cash proceeds from the Rights Offering after payment of fees and
expenses would be approximately [$300] million, assuming full exercise of all
Rights.  The Rights Offering is, however, not conditioned upon any minimum
level of exercise of the Rights, and there can be no assurance that the
Company will raise any proceeds from the Rights Offering.  RCN has,
however, informed the Company that it intends to exercise the Rights it
receives for an aggregate subscription price of $[ ] and that it intends to
exercise the Oversubscription Privilege for an aggregate subscription price
of approximately $50,000,000 to subscribe for [    ] additional shares of
Common Stock. The opportunity to exercise the Oversubscription Privilege is
available to all holders of Rights on the same terms.  See "The Rights
Offering--Subscription Privileges--Oversubscription Privilege." RCN does
not intend to purchase any additional Rights through open market purchases
or otherwise.
    

      The net proceeds, if any, from the Rights Offering will be used for
general corporate purposes.  In the event that all Rights are not exercised
the Company expects that, consistent with its corporate strategy as
described below, the proceeds, together with the proceeds from the recently
completed sale of the Company's cellular properties, will be used, first,
to finance the pending acquisition of Twin County, second, to prepay
$100,000,000 in aggregate principal amount of the Company's 9.52% Senior
Secured Notes due December 1, 2001 (the "Senior Secured Notes"), third, to
develop Full Service Networks utilizing certain of the Company's cable
television and telephone systems or other platforms (such as leased or
overbuilt facilities) and, fourth, for potential acquisitions, joint
ventures and similar strategic investments in the telecommunications
industry.  See "Recent Developments" and "Corporate Strategy".  The Company
desires to position itself to take advantage of strategic opportunities as
they arise.  The Company cannot predict with any degree of precision how
much capital will be needed for this purpose because of the uncertainty as
to what opportunities will arise.  If the Company does not raise adequate
capital through the Rights Offering to pursue opportunities that may arise
and that further its corporate strategy, the Company may attempt to raise
capital through other means.

      Prior to the consummation of the Rights Offering, the Company may
prepay the Senior Secured Notes by entering into a short term revolving
credit facility on terms the Company believes are favorable and then repay
such short term credit facility with the proceeds from the Rights Offering.
The Company intends to prepay the Senior Secured Notes in order to
eliminate certain restrictive covenants in those securities that could
inhibit the Company's ability to pursue its corporate strategy. In order to
prepay the Senior Secured Notes, the Company is required to pay the holders
of those notes a "make whole amount." The Company estimates that the make
whole amount will be approximately $5,000,000 in aggregate.

                              CORPORATE STRATEGY

      The Company believes that the long term competitiveness of
telecommunications systems will be based upon the capacity to provide Full
Service Networks.  Present basic telecommunications services such as cable
television and telephone are provided over separate networks and the
businesses of delivering these services have distinct and different
attributes.  Cable television (video) services are typically delivered over a
broad band, one-way network with revenues generated principally on a
subscription basis.  Telephone (voice and data) service is provided over a
two-way, narrow band network with revenues generated both on a subscription
and a transaction basis.  Full Service Networks will combine key attributes of
both types of networks and businesses including the high capacity of cable
television networks and the access to switching of telephone networks.
Additionally, the Company believes these services (as well as various new
services) will generate revenues on both a subscription and a transaction
basis.

      The Company believes that because of its experience in the design,
construction and operation of both telephone and cable television systems it
is well positioned to implement competitive Full Service Networks designed
around such systems as well as other platforms.  The Company has been in the
cable television business for nearly 15 years and has grown to be among the
top 35 multiple system operators in the country.  The Company has been in the
telephone business for nearly 100 years.  The Company believes that compared
to telephone systems of similar or greater size its telephone operations have
been among the most efficient in the United States as measured by employees
per 10,000 access lines and as measured by trouble reports.

      The Company intends to develop Full Service Networks utilizing certain
of the Company's cable television and telephone systems or other platforms and
to expand the footprint available for upgrade through acquisitions, joint
ventures and similar strategic investments in the telecommunications industry.
The Company intends to implement these expanded services at an early stage
relative to its competitors.  The Company also intends to explore
opportunities to expand its business into international markets.

      The Company believes that there will be acquisition and joint venture
opportunities involving system operators which do not otherwise have the
resources or expertise to effectively develop competitive networks.  With
adequate capital resources the Company believes it will be well positioned
to take advantage of such opportunities as they arise.  Although the
Company is exploring a number of possible transactions, the
Company has no commitment for any material acquisition, joint venture or
investment, other than the pending acquisition of Twin County described in
"Recent Developments," and there can be no assurance that appropriate
acquisition, joint venture and investment opportunities will arise in the
future.

                            RECENT DEVELOPMENTS

      The Mobile Services Group previously operated cellular telephone
systems in MSAs and RSAs throughout eight counties in Northeastern and
Central Pennsylvania and 24 counties in Southwest Iowa, serving a total
population of 1.5 million.  On September 9, 1994, the Company completed the
sale of its cellular properties to ICN for approximately $182.5 million
subject to certain adjustments to be made within 90 days after closing
estimated to result in approximately $7 million of additional proceeds.
For information on the pro forma effect of such sale, see "Pro Forma
Condensed Consolidated Financial Statements."

      C-TEC Cable Systems, Inc., a wholly owned subsidiary of the Company,
has entered into a Merger Agreement (the "Merger Agreement") with Twin
County Trans Video, Inc.  ("Twin County") and Bark Lee Yee, Stella C.  Yee,
Susan C.  Yee, Raymond C.  Yee and Kenneth C.  Yee, shareholders of Twin
County, and Robert G.  Tallman, as trustee of a trust holding certain
shares of Twin County common stock.  Founded in 1962, Twin County is one of
the nation's oldest cable companies and is currently one of the top 100
cable companies in the United States.  Twin County serves over 50
contiguous franchises, providing cable television service to approximately
74,000 subscribers in the Greater Lehigh Valley area of Pennsylvania,
situated within 75 miles of the New York, Philadelphia, and Wilkes-Barre
metropolitan areas.

      Under the terms of the Merger Agreement Twin County will merge with
and into C-TEC Cable Systems of Pennsylvania, Inc., a wholly owned
subsidiary of C-TEC Cable Systems, Inc.  The transaction is subject to
regulatory approval and certain other conditions.  For information on the
pro forma effect of such pending acquisition, see "Pro Forma Condensed
Consolidated Financial Statements."

      The aggregate consideration for the acquisition of all the capital
stock of Twin County and for certain related noncompetition agreements will
be cash of approximately $47.5 million, a promissory note of $4 million,
and exchangeable preferred stock of C-TEC Cable Systems, Inc. with an
aggregate liquidation preference of $52 million (the "Cable Preferred
Stock").  The Cable Preferred Stock consists of Cable Preferred Stock
Series A shares with a total liquidation preference of $41 million (the
"Cable Preferred Stock Series A") and Cable Preferred Stock Series B shares
with a total liquidation preference of $11 million (the "Cable Preferred
Stock Series B").  The cash portion of the purchase price is subject to
certain adjustments, which are not estimated to be material, based on the
excess of Twin County's liabilities over its cash balance at the closing date.

     The dividend rate on each series of Cable Preferred Stock is 5% per annum
of the liquidation preference, and unpaid dividends are cumulative.
Beginning three years from the closing date of the acquisition and expiring
ten years from such closing date, the holders of Cable Preferred Stock
Series A acting unanimously may exchange their Cable Preferred Stock with
the Company for 1,171,428 shares of common stock of the Company (the
"Series A Exchange Shares") and the holders of Cable Preferred Stock Series
B acting unanimously may exchange their Preferred Stock with the Company
for 285,714 shares of common stock of the Company (the "Series B Exchange
Shares").  During the same time period, the Company may elect to acquire
all, but not less than all of either or both series of Cable Preferred
Stock as follows:  (i) if the market value of the Exchange Shares for such
series at the time of election is greater than or equal to the aggregate
liquidation preference for such series, the consideration shall be the
Exchange Shares for such series and (ii) if the market value of the
Exchange Shares for such series at the time of election is less than the
aggregate liquidation preference for such series, the consideration shall
be, at the holders' option, either (x) an amount of cash equal to the
aggregate liquidation preference for such series or (y) the Exchange Shares
for such series.  If at the end of such period, neither the holders of the
Cable Preferred Stock nor the Company has made any of the elections
described above, then the holders of the Cable Preferred Stock acting
unanimously may elect to sell such stock to the Company for $52 million.

                PRICE RANGE OF COMMON STOCK AND DIVIDEND POLICY

      The principal market for the Common Stock is NASDAQ.  The following
table indicates the high and low per-share sales prices for the Common Stock
as reported by NASDAQ for the periods indicated
                                                       High        Low
                                                      ------      -----
   
1992
      First Quarter...............................    $16.25      $14.50
      Second Quarter..............................     15.00       10.75
      Third Quarter...............................     14.00        9.75
      Fourth Quarter..............................     15.25       10.00
1993
      First Quarter...............................     17.75       13.50
      Second Quarter..............................     25.00       15.75
      Third Quarter...............................     28.00       23.50
      Fourth Quarter..............................     33.50       23.75
1994
      First Quarter...............................     31.00       27.25
      Second Quarter..............................     28.50       24.50
      Third Quarter...............................     29.50       21.25
      Fourth Quarter(1)...........................    [28.25]     [23.00]
_______________

(1)  Through the close of business on November 10, 1994.
    

      Since 1989, the Company has maintained a policy of not paying cash
dividends.  The Company does not intend to alter this policy in the
foreseeable future.  Certain debt instruments to which the Company is a
party contain restrictions on the payment of cash dividends on the
Company's Common Stock.

                                   DILUTION

   
      The pro forma net tangible book value of the shares of Company Stock
as of June 30, 1994, reflecting the sale of the cellular properties and the
pending acquisition of Twin County, was approximately $23 million, or $1.28
per share assuming the exchange of the Cable Preferred Stock to be issued
in the pending Twin County acquisition.  See "Pro Forma Condensed
Consolidated Financial Statements." "Net tangible book value" per share
represents the amount of total tangible assets (total assets less
intangible assets) less total liabilities, divided by the number of shares
of Company Stock outstanding, assuming the Cable Preferred Stock to be
issued in connection with the pending Twin County acquisition had been
exchanged with the Company for 1,457,142 newly issued shares of Common
Stock.  After giving effect to the sale by the Company of the 14,858,634
shares of Common Stock offered hereby (assuming full exercise of the
Rights) and after deducting the estimated offering expenses, the adjusted
pro forma net tangible book value of the Company as of June 30, 1994 would
have been approximately $[ ], or $[ ] per share, representing an immediate
and substantial dilution of $[ ] per share in respect of shares of Common
Stock purchased pursuant to this Rights Offering.  The following table
illustrates this per share dilution:

Subscription Price.........................................          $[     ]
  Pro forma net tangible book value per share
    before offering........................................  $1.28
  Increase per share attributable to shareholders
    exercising Rights......................................   [     ]
Adjusted pro forma net tangible book value per share
    after offering.........................................           [     ]
Dilution to shareholders exercising Rights(1)..............          $[     ]
                                                                     ========

- -------------
(1) Dilution is determined by subtracting the pro forma net tangible book
    value per share from the Subscription Price paid by an investor for a
    share of Common Stock in the Rights Offering.
    

      The foregoing assumes no exercise of the options issued to officers
of the Company under its stock option plan.  As of November 10, 1994, options
to purchase 715,500 shares of Common Stock were outstanding with a weighted
average exercise price of $23.72 per share.  In addition, the Company has
granted options to purchase 250,000 shares of Common Stock to an executive
officer.  The exercise price of such options will be the market price of
the Common Stock on a date specified in early 1995.

                              THE RIGHTS OFFERING

The Rights

   
      The Company is distributing transferable Rights at no cost to the
record holders ("Holders") of outstanding shares of Company Stock as of
November 10, 1994 (the "Record Date").  The Company will distribute nine
Rights for every ten shares of Company Stock held on the Record Date.
The Rights will be evidenced by transferable subscription certificates (the
"Subscription Certificates") and each such Right entitles the holder
thereof to subscribe for one share of Common Stock.
    

      The Subscription Price of $________ per share of Common Stock
represents a discount of __% from the closing price of $______ for the
Common Stock as quoted on NASDAQ on November 10, 1994, the day of the
commencement of the Rights Offering.  There can be no assurance that the
Common Stock will trade at prices above the Subscription Price.  See
"Investment Considerations--Uncertain Market for Rights."

      No fractional Rights or cash in lieu thereof will be issued or paid.
The number of Rights distributed to each Holder will be rounded up to the
nearest whole number.  No Subscription Certificate may be divided in such a
way as to permit the holder of such certificate to receive a greater number of
Rights than the number to which such Subscription Certificate entitles its
holder, except  that a depository, bank, trust company, or securities broker
or dealer holding shares of Company Stock on the Record Date for more than one
beneficial owner may, upon proper showing to the Subscription Agent, exchange
its Subscription Certificate to obtain a Subscription Certificate for the
number of Rights to which all such beneficial owners in the aggregate would
have been entitled had each been a Holder on the Record Date.  The Company
reserves the right to refuse to issue any such Subscription Certificate if
such issuance would be inconsistent with the principle that each beneficial
owner's holdings will be rounded up to the nearest whole Right.

      Because the number of Rights distributed to each record holder will be
rounded up to the nearest whole number, beneficial owners of Company Stock who
are also the record holders of such shares will receive more Rights under
certain circumstances than beneficial owners of Company Stock who are not the
record holders of their shares and who do not obtain (or cause the record
holder of their shares of Company Stock to obtain) a separate Subscription
Certificate with respect to the shares beneficially owned by them, including
shares held in an investment advisory or similar account.  To the extent that
record holders of Company Stock or beneficial owners of Company Stock who
obtain a separate Subscription Certificate receive more Rights, they will be
able to subscribe for more shares pursuant to the Basic Subscription Privilege
and, in the event shares subscribed for pursuant to the Oversubscription
Privilege are prorated, such record holders or beneficial owners will be able
to subscribe for more shares pursuant to the Oversubscription Privilege.

   
      The issuance by the Company of shares of Common Stock pursuant to the
Rights Offering is not conditioned upon the subscription of any minimum number
of shares of Common Stock by holders of the Rights, and no assurance can be
given that the Company will raise any proceeds from the Rights Offering.  RCN
has, however, informed the Company that it intends to exercise the Rights it
receives for an aggregate subscription price of $[   ] and that it intends to
exercise the Oversubscription Privilege for an aggregate subscription price
of approximately $50,000,000 to subscribe for [ ] additional shares of Common
Stock.  The opportunity to exercise the Oversubscription Privilege is
available to all holders of Rights on the same terms. See "The Rights
Offering--Subscription Privileges--Oversubscription Privilege." RCN does
not intend to purchase any additional Rights through open market purchases
or otherwise.
    

      BEFORE EXERCISING OR SELLING ANY RIGHTS, POTENTIAL INVESTORS ARE URGED
TO READ CAREFULLY THE INFORMATION SET FORTH UNDER "INVESTMENT CONSIDERATIONS."

Expiration Date

   
      The Rights will expire at 5:00 p.m., New York City time, on December
1, 1994, unless extended (as it may be extended, the "Expiration Date").
After such time, unexercised Rights will be null and void.  The Company
will not be obligated to honor any purported exercise of Rights received by
the Subscription Agent after 5:00 p.m., New York City time, on the
Expiration Date, regardless of when the documents relating to such exercise
were sent, except pursuant to the Guaranteed Delivery Procedures described
below.
    

Subscription Privileges

      Basic Subscription Privilege.  Each Right will entitle the holder
thereof to receive, upon payment of the Subscription Price, one share of
Common Stock (the "Basic Subscription Privilege").  Certificates representing
shares of Common Stock purchased pursuant to the Basic Subscription Privilege
will be delivered to subscribers as soon as practicable after the
corresponding Rights have been validly exercised and full payment for shares
has been received and cleared.

      Oversubscription Privilege.  Subject to the allocation described below,
each Right also carries the right to subscribe at the Subscription Price for
additional shares of Common Stock (the "Oversubscription Privilege") up to the
amount offered hereby.  All beneficial holders who exercise the Basic

Subscription Privilege in full will be entitled to exercise the
  Oversubscription Privilege.

      Underlying Shares will be available for purchase pursuant to the
Oversubscription Privilege only to the extent that any Underlying Shares are
not subscribed for through the Basic Subscription Privilege.  If the
Underlying Shares not subscribed for through the Basic Subscription Privilege
(the "Excess Shares") are not sufficient to satisfy all subscriptions pursuant
to the Oversubscription Privilege, the Excess Shares will be allocated pro
rata (subject to the elimination of fractional shares) among those holders of
Rights exercising the Oversubscription Privilege, in proportion, not to the
number of shares requested pursuant to the Oversubscription Privilege, but to
the number of shares each beneficial holder exercising the Oversubscription
Privilege has purchased pursuant to the Basic Subscription Privilege;
provided, however, that if such pro rata allocation results in any Rights
holder being allocated a greater number of Excess Shares than such holder
subscribed for pursuant to the exercise of such holder's Oversubscription
Privilege, then such holder will be allocated only such number of Excess
Shares as such holder subscribed for and the remaining Excess Shares will be
allocated among all other holders exercising the Oversubscription Privilege.
Certificates representing shares of Common Stock purchased pursuant to the
Oversubscription Privilege will be delivered to subscribers as soon as
practicable after the Expiration Date and after all prorations and adjustments
contemplated by the terms of the Rights Offering have been effected.

      Banks, brokers and other nominee holders of Rights who exercise the
Basic Subscription Privilege and the Oversubscription Privilege on behalf of
beneficial owners of Rights will be required to certify to the Subscription
Agent and the Company, in connection with the exercise of the Oversubscription
Privilege, as to the aggregate number of Rights that have been exercised and
the number of Underlying Shares that are being subscribed for pursuant to the
Oversubscription Privilege by each beneficial owner of Rights on whose behalf
such nominee holder is acting.

Exercise of Rights

      Rights may be exercised by delivering to The First National Bank of
Boston (the "Subscription Agent"), at or prior to 5:00 p.m., New York City
time, on the Expiration Date, the properly completed and executed
Subscription Certificate evidencing such Rights with any signatures
required to be guaranteed so guaranteed, together with payment in full of
the Subscription Price for each Underlying Share subscribed for pursuant to
the Basic Subscription Privilege and the Oversubscription Privilege.  Any
Rights holder subscribing for an aggregate of more than 5000 Underlying
Shares pursuant to the Oversubscription Privilege prior to the Expiration
Date shall not be required to deliver payment for such number of Underlying
Shares in excess of 5000 until the Expiration Date.  The Company, in its
sole discretion, may determine to waive payment for such excess number of
Underlying Shares until after the Expiration Date and after all prorations
and adjustments contemplated by the terms of the Rights Offering have been
effected.  All payments must be by (a) check or bank draft drawn upon a
U.S. bank or postal or express money order payable to The
First National Bank of Boston, as Subscription Agent, or (b) by wire
transfer of same-day funds, in which case please contact the Subscription
Agent at (617) 575-2700 for such information.  Payments will be deemed to
have been received by the Subscription Agent only upon (i) clearance of any
uncertified check, (ii) receipt by the Subscription Agent of any certified
check or bank draft upon a U.S. bank or of any postal or
express money order or (iii) receipt of good funds in the Subscription
Agent's account designated above.  If paying by uncertified personal check,
please note that the funds paid thereby may take at least five business
days to clear.  Accordingly, holders of Rights who wish to pay the
Subscription Price by means of uncertified personal check are urged to make
payment sufficiently in advance of the Expiration Date to ensure that such
payment is received and clears by such date and are urged to consider
payment by means of certified or cashier's check, money order or wire
transfer of funds.

      The address to which the Subscription Certificates and payment of the
Subscription Price should be delivered is:

            By Mail:

            The First National Bank of Boston
            P.O. Box 1872
            Mail Stop 45-01-19
            Boston, Massachusetts
            02105-1872

            By Hand:

            BancBoston Trust Company of
              New York
            55 Broadway
            3rd Floor
            New York, New York
            10006

            By Overnight Courier:

            The First National Bank of Boston
            Shareholder Services Division
            150 Royall Street
            Mail Stop 45-01-19
            Canton, Massachusetts
            02021

If a Rights holder wishes to exercise Rights, but time will not permit such
holder to cause the Subscription Certificate or Subscription Certificates
evidencing such Rights to reach the Subscription Agent on or prior to the
Expiration Date, such Rights may nevertheless be exercised if all of the
following conditions (the "Guaranteed Delivery Procedures") are met:

          (i) such holder has caused payment in full of the Subscription Price
      for each Underlying Share being subscribed for pursuant to the Basic
      Subscription Privilege and the Oversubscription Privilege (subject to
      the right of the Company to waive advance payment in respect of the
      Oversubscription Privilege as described above) to be received (in the
      manner set forth above) by the Subscription Agent on or prior to the
      Expiration Date;

         (ii) the Subscription Agent receives, on or prior to the Expiration
      Date, a guarantee notice ("Notice of Guaranteed Delivery"),
      substantially in the form provided with the instructions as to use of
      C-TEC Corporation Subscription Certificates (the "instructions")
      distributed with the Subscription Certificates, from a member firm of a
      registered national securities exchange or a member of the National
      Association of Securities Dealers, Inc. ("NASD"), or from a commercial
      bank or trust company having an office or correspondent in the United
      States or from a bank, stockbroker, savings and loan association or
      credit union with membership in an approved signature guarantee
      medallion program, pursuant to Rule 17Ad-15 of the Exchange Act
      (each, an "Eligible Institution"), stating the name of the exercising
      Rights holder, the number of Rights represented by the Subscription
      Certificate or Subscription Certificates held by such exercising
      Rights holder, the number of Underlying Shares being subscribed for
      pursuant to the Basic Subscription Privilege and the number of
      Underlying Shares, if any, being subscribed for pursuant to the
      Oversubscription Privilege, and guaranteeing the delivery to the
      Subscription Agent of any Subscription Certificate evidencing such
      Rights within five NASDAQ trading days following the Expiration Date;
      and

   
        (iii) the properly completed Subscription Certificate evidencing the
      Rights being exercised, with any signatures required to be guaranteed
      so guaranteed, is received by the Subscription Agent within five
      NASDAQ trading days following the Expiration Date.  The Notice of
      Guaranteed Delivery may be delivered to the Subscription Agent in the
      same manner as Subscription Certificates at the address set forth
      above, or may be transmitted to the Subscription Agent by facsimile
      transmission (telecopy no.  (617) 575-2232 or -2233).  Additional
      copies of the form of Notice of Guaranteed Delivery are available
      upon request from the Information Agent, whose address and telephone
      number are set forth under "Information Agent."
    

      Funds received in payment of the Subscription Price for Excess Shares
subscribed for pursuant to the Oversubscription Privilege will be held in a
segregated account pending issuance of such Excess Shares.  If a Rights holder
exercising the Oversubscription Privilege is allocated less than all of the
shares of Common Stock which such holder subscribed for pursuant to the
Oversubscription Privilege, the excess funds paid by such holder in respect of
the Subscription Price for shares not issued shall be returned by mail without
interest or deduction as soon as practicable after the Expiration Date and
after all prorations and adjustments contemplated by the terms of the Rights
Offering have been effected.

      Unless a Subscription Certificate (i) provides that the shares of Common
Stock to be issued pursuant to the exercise of Rights represented thereby are
to be delivered to the record holder of such Rights or (ii) is submitted for
the account of an Eligible Institution, signatures on such Subscription
Certificate must be guaranteed by an Eligible Institution or other eligible
guarantor institution which is a member of or a participant in a medallion
guarantee program acceptable to the Subscription Agent.

      Holders who hold shares of Company Stock for the account of others, such
as brokers, trustees or depositories for securities, should notify the
respective beneficial owners of such shares as soon as possible to ascertain
such beneficial owners' intentions and to obtain instructions with respect to
the Rights.  If the beneficial owner so instructs, the record holder of such
Rights should complete Subscription Certificates and submit them to the
Subscription Agent with the proper payment.  In addition, beneficial owners of
Common Stock or Rights held through a record holder should contact the holder
and request the holder to effect transactions in accordance with such
beneficial owner's instructions.

      The instructions accompanying the Subscription Certificates should be
read carefully and followed in detail.  DO NOT SEND SUBSCRIPTION CERTIFICATES
TO THE COMPANY.

      THE METHOD OF DELIVERY OF SUBSCRIPTION CERTIFICATES AND PAYMENT OF THE
SUBSCRIPTION PRICE TO THE SUBSCRIPTION AGENT WILL BE AT THE ELECTION AND RISK
OF THE RIGHTS HOLDERS, BUT IF SENT BY MAIL IT IS RECOMMENDED THAT SUCH
CERTIFICATES AND PAYMENTS BE SENT BY REGISTERED MAIL, PROPERLY INSURED, WITH
RETURN RECEIPT REQUESTED, AND THAT A SUFFICIENT NUMBER OF DAYS BE ALLOWED TO
ENSURE DELIVERY TO THE SUBSCRIPTION AGENT AND CLEARANCE OF PAYMENT PRIOR TO
5:00 P.M., NEW YORK CITY TIME, ON THE EXPIRATION DATE.  BECAUSE UNCERTIFIED
PERSONAL CHECKS MAY TAKE AT LEAST FIVE BUSINESS DAYS TO CLEAR, YOU ARE
STRONGLY URGED TO PAY, OR ARRANGE FOR PAYMENT, BY MEANS OF CERTIFIED OR
CASHIER'S CHECK, MONEY ORDER OR WIRE TRANSFER OF FUNDS.

      All questions concerning the timeliness, validity, form and eligibility
of any exercise of Rights will be determined by the Company, whose
determinations will be final and binding.  The Company in its sole discretion
may waive any defect or irregularity, or permit a defect or irregularity to be
corrected within such time as it may determine, or reject the purported
exercise of any Right.  Subscriptions will not be deemed to have been received
or accepted until all irregularities have been waived or cured within such
time as the Company determines in its sole discretion.  Neither the Company,
the Subscription Agent, nor the Information Agent will be under any duty to
give notification of any defect or irregularity in connection with the
submission of Subscription Certificates or incur any liability for failure to
give such notification.

      Any questions or requests for assistance concerning the method of
exercising Rights or requests for additional copies of this Prospectus, the
Instructions or the Notice of Guaranteed Delivery should be directed to the
Information Agent, MacKenzie Partners, Inc., at its address set forth under
"Information Agent" (telephone:  (212) 929-5500 or (800) 322-2885).

No Revocation

      ONCE A HOLDER OF RIGHTS HAS EXERCISED THE BASIC SUBSCRIPTION PRIVILEGE
AND/OR THE OVERSUBSCRIPTION PRIVILEGE, SUCH EXERCISE MAY NOT BE REVOKED.

Method of Transferring Rights

      Rights may be purchased or sold through usual investment channels,
including banks and brokers.  It is anticipated that the Rights will be
traded on NASDAQ under the symbol "CTEXR." Rights also may be sold in
over-the-counter and private sales transactions.  Certain registered
broker-dealers have indicated that they intend to make a market in the Rights
during the period the Rights are outstanding.  No assurance can be given,
however, that a market for the Rights will develop or, if such a market
develops, as to how long it will continue.

      The Rights evidenced by a single Subscription Certificate may be
transferred in whole by endorsing the Subscription Certificate for transfer in
accordance with the instructions accompanying the Subscription Certificate.  A
portion of the Rights evidenced by a single Subscription Certificate (but not
fractional Rights) may be transferred by delivering to the Subscription Agent
a Subscription Certificate properly endorsed for transfer, with instructions
to register such portion of the Rights evidenced thereby in the name of the
transferee (and to issue a new Subscription Certificate to the transferee
evidencing such transferred Rights).  In such event, a new Subscription
Certificate evidencing the balance of the Rights will be issued to the Rights
holder or, if the Rights holder so instructs, to an additional transferee.

      The Rights evidenced by a Subscription Certificate also may be sold, in
whole or in part, through the Subscription Agent by delivering to the
Subscription Agent such Subscription Certificate properly executed for sale by
the Subscription Agent.  If only a portion of the Rights evidenced by a single
Subscription Certificate are to be sold by the Subscription Agent, such
Subscription Certificate must be accompanied by instructions setting forth the
action to be taken with respect to the Rights that are not to be sold.  If the
Rights can be sold, sales of such Rights will be deemed to have been effected
at the weighted average price received by the Subscription Agent on the day
such Rights are sold, less any applicable brokerage commissions, taxes and
other direct expenses of sale.  Promptly following the settlement of such
sale, the Subscription Agent will send the Rights holder a check for the net
proceeds (after deduction of any applicable brokerage commissions, taxes and
other direct expenses of the sale) from the sale of any Rights sold.  The
Company will pay the fees charged by the Subscription Agent for effecting such
sales.  Orders to sell Rights must be received by the Subscription Agent prior
to 11:00 a.m., New York City time, on November 23, 1994, and the Subscription
Agent's obligation to execute orders is subject to its ability to find buyers.

      Holders wishing to transfer all or a portion of their Rights (but not
fractional Rights) should allow a sufficient amount of time prior to the
Expiration Date for (i) the transfer instructions to be received and processed
by the Subscription Agent, (ii) a new Subscription Certificate to be issued
and transmitted to the transferee or transferees with respect to transferred
Rights, and to the transferor with respect to retained Rights, if any, and
(iii) the Rights evidenced by such new Subscription Certificates to be
exercised or sold by the recipients thereof.  Neither the Company nor the
Subscription Agent shall have any liability to a transferee or transferor of
Rights if Subscription Certificates are not received in time for exercise or
sale prior to the Expiration Date.

      Except for the fees charged by the Subscription Agent (which will be
paid by the Company as described above), all commissions, fees and other
expenses (including brokerage commissions and transfer taxes) incurred in
connection with the purchase, sale or exercise of Rights will be for the
account of the transferor of the Rights, and none of such commissions, fees or
expenses will be paid by the Company or the Subscription Agent.

Procedures for Book Entry Transfer Facility Participants

      The Company anticipates that the Rights will be eligible for transfer
through, and that the exercise of the Basic Subscription Privilege (but not
the Oversubscription Privilege) may be effected through, the facilities of the
Depository Trust Company, Midwest Securities Trust Company and Philadelphia
Depository Trust Company (collectively, the "Book Entry Facilities"; Rights
exercised through any such facility are referred to as "Book Entry Exercised
Rights").  The holder of a Book Entry Exercised Right may exercise the
Oversubscription Privilege in respect of such Book Entry Exercised Right by
properly executing and delivering to the Subscription Agent, at or prior to
5:00 p.m., New York City time, on the Expiration Date, a Nominee Holder
Oversubscription Form, together with payment of the Subscription Price for the
number of Underlying Shares for which the Oversubscription Privilege is to be
exercised.  Any Rights holder subscribing for an aggregate of more than 5000
Underlying Shares pursuant to the Oversubscription Privilege prior to the
Expiration Date shall not be required to deliver payment for such number of
Underlying Shares in excess of 5000 until the Expiration Date.  The Company,
in its sole discretion, may determine to waive payment for such excess number
of Underlying Shares until after the Expiration Date and after all prorations
and adjustments contemplated by the terms of the Rights Offering have been
effected.  Copies of the Nominee Holder Oversubscription Form may be obtained
from the Subscription Agent.

Effect of Rights Offering on Other Securities
and Stock Options of the Company and Company Plans

      The number of shares covered by certain stock options and the option
prices thereunder are subject to adjustment in accordance with the provisions
thereof.  The Company's stock option plan or, in certain cases, the stock
option agreements evidencing awards made thereunder, require the Compensation
Committee of the Board of Directors (the "Committee") to make appropriate
adjustments to the outstanding options or other awards in the event of any
split-ups, stock dividends, recapitalizations, mergers, consolidations,
combinations, exchanges of shares and the like (each an "adjustment event").
The Committee, whose determination shall be conclusive, has discretion to
determine the nature and extent of the adjustments to be made in order to make
the outstanding options or awards, immediately after such adjustment event,
equivalent to such options or awards immediately prior to such adjustment
event.

      The Committee will meet to determine whether the Rights Offering is an
adjustment event and if so, what adjustment to make.

Determination of Subscription Price

      The Subscription Price was determined by the Company and its Board of
Directors.  In making this determination, the Company considered, among other
factors, the market price of the Common Stock, the pro rata nature of the
offering and pricing discounts customarily applied in transactions of this
type.  The Subscription Price should not be considered an indication of the
actual value of the Company or the Common Stock.  See "Price Range of Common
Stock and Dividend Policy."

Intent of RCN

   
      RCN will receive 5,125,492 Rights in respect of the shares of Company
Stock it owns, and such Rights represent 34.5% of the total Rights to be
distributed.  RCN has informed the Company that it intends to exercise the
Rights it receives for an aggregate subscription price of $[    ] and that it
intends to exercise the Oversubscription Privilege for an aggregate
subscription price of approximately $50,000,000 to subscribe for [     ]
additional shares of Common Stock. The opportunity to exercise the
Oversubscription Privilege is available to all holders of Rights on the
same terms.  See "The Rights Offering--Subscription
Privileges--Oversubscription Privilege." If RCN is the only holder to
exercise its Rights, it will own approximately 59.6% of the Class B Stock
and [ ]% of the Common Stock.  RCN does not intend to purchase any
additional Rights through open market purchases or otherwise.
    

Foreign and Certain Other Shareholders

      Subscription Certificates will not be mailed to Holders whose
addresses are outside the United States or who have an APO or FPO address,
but will be held by the Subscription Agent for their account.  To exercise
such Rights, such a Holder must notify the Subscription Agent on or prior
to 11:00 a.m., New York City time, on November 23, 1994, and must establish
to the satisfaction of the Subscription Agent that such exercise is
permitted under appliable law.  If such a Holder does not notify the
Subscription Agent and provide acceptable instructions to the Subscription
Agent by such time, such Rights represented thereby will be sold, if
feasible, and the net proceeds, if any, remitted to such Holder.  If the
Rights can be sold, sales of such Rights will be deemed to have been
effected at the weighted average price received by the Subscription Agent
on the day such Rights are sold, less any applicable brokerage commissions,
taxes and other expenses.

Other Matters

      The Rights Offering is not being made in any state or other jurisdiction
in which it is unlawful to do so, nor is the Company selling or accepting any
offers to purchase any shares of Company Stock from Rights holders who are
residents of any such state or other jurisdiction.  The Company may delay the
commencement of the Rights Offering in certain states or other jurisdictions
in order to comply with the securities law requirements of such states or
other jurisdictions.  It is not anticipated that there will be any changes in
the terms of the Rights Offering.  The Company, if it so determines in its
sole discretion, may decline to make modifications to the terms of the Rights
Offering requested by certain states or other jurisdictions, in which event
Rights holders resident in those states or jurisdictions will not be eligible
to participate in the Rights Offering.

                    CERTAIN FEDERAL INCOME TAX CONSEQUENCES

      The following summary describes certain United States federal income tax
considerations applicable to U.S. Holders who hold Company Stock as a capital
asset and who receive Rights in respect of such Company Stock in the issuance
(the "Issuance").  This summary is based upon laws, regulations, rulings and
decisions currently in effect.  This summary does not discuss all aspects of
federal income taxation that may be relevant to a particular investor or to
certain types of investors subject to special treatment under the federal
income tax laws (for example, banks, dealers in securities, life insurance
companies, tax exempt organizations and foreign taxpayers), nor does it
discuss any aspect of state, local or foreign tax laws.

Issuance of the Rights

      Holders of Company Stock will not recognize taxable income in connection
with the receipt or exercise of the Rights.

Basis and Holding Period of the Rights

      Except as provided in the following sentence, the basis of the Rights
received by a shareholder as a distribution with respect to such shareholder's
Company Stock will be zero.  If either (i) the fair market value of the Rights
on the date of Issuance is 15% or more of the fair market value (on the date
of Issuance) of the Company Stock with respect to which they are received or
(ii) the shareholder elects, in his or her federal income tax return for the
taxable year in which the Rights are received, to allocate part of the basis
of such Company Stock to the Rights, then upon exercise or transfer of the
Rights, the shareholder's basis in such Company Stock will be allocated
between the Company Stock and the Rights in proportion to the fair market
values of each on the date of Issuance.  The holding period of a shareholder
with respect to the Rights received as a distribution on such shareholder's
Company Stock will include the shareholder's holding period for the Company
Stock with respect to which the Rights were issued.

Transfer of the Rights

      A shareholder who sells Rights received in the Issuance prior to
exercise will recognize gain or loss equal to the difference between the sale
proceeds and such shareholder's basis (if any) in the Rights sold.  Such gain
or loss will be long-term capital gain or loss if such shareholder's holding
period in the Rights (as discussed above) exceeds one year.  The excess of net
long-term capital gains over net short-term capital losses is taxed at a lower
rate than ordinary income for certain non-corporate taxpayers.  The
distinction between capital gain or loss and ordinary income is also
relevant for purposes of, among other things, limitations on the
deductibility of capital losses.

Lapse of the Rights

      Shareholders who allow the Rights received by them at the Issuance to
lapse will not recognize any gain or loss, and no adjustment will be made to
the basis of the Company Stock, if any, owned by such holders of the Rights.

Exercise of the Rights; Basis
and Holding Period of Common Stock

      Holders of Rights will not recognize any gain or loss upon the exercise
of such Rights.  The basis of the Common Stock acquired through exercise of
the Rights will be equal to the sum of the Subscription Price therefor and the
Rights holder's basis in such Rights (if any) as described above.  The holding
period for the Common Stock acquired through exercise of the Rights will begin
on the date the Rights are exercised.

      THE FOREGOING SUMMARY IS INCLUDED FOR GENERAL INFORMATION ONLY.
ACCORDINGLY, EACH SHAREHOLDER IS URGED TO CONSULT WITH HIS OR HER OWN TAX
ADVISOR WITH RESPECT TO THE TAX CONSEQUENCES OF THE RIGHTS OFFERING ON HIS OR
HER OWN PARTICULAR TAX SITUATION, INCLUDING THE APPLICATION AND EFFECT OF
STATE AND LOCAL INCOME AND OTHER TAX LAWS.


             PRO FORMA CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

   
      The following unaudited Pro Forma Condensed Consolidated Balance
Sheet as of June 30, 1994 gives effect to the disposition of cellular
properties and the pending acquisition of Twin County (the "transactions")
as though they had occurred on June 30, 1994.  The following unaudited Pro
Forma Condensed Consolidated Statements of Operations for the six months
ended June 30, 1994 and the year ended December 31, 1993 give effect to the
transactions as though they had occurred on January 1, 1993.  These pro
forma financial statements should be read in conjunction with (i)  Twin
County's historical financial statements and notes thereto contained in the
Company's Current Report on Form 8-K dated October 27, 1994, as amended on
November 10, 1994, and (ii) the Company's historical consolidated financial
statements and notes thereto contained in the Company's Annual Report on
Form 10-K for the fiscal year ended December 31, 1993, as amended on
October 28, 1994, and as further amended on November 10, 1994, and in the
Company's Quarterly Report on Form 10-Q for the six months ended June 30,
1994, as amended on October 28, 1994.  The Pro Forma Condensed Consolidated
Statements of Operations and Balance Sheet are not necessarily indicative
of the actual results of operations or financial position which would have
been reported if the transactions had occurred on the respective dates
referred to above nor do they purport to indicate the results of future
operations or financial position of the Company.  In the opinion of
management, all adjustments necessary to present fairly such pro forma
financial statements have been made.  Information with respect to Twin
County and the historical financial information of Twin County was provided
by Twin County.
    

<TABLE>
<CAPTION>
                                                                C-TEC Corporation
                                                  Pro Forma Condensed Consolidated Balance Sheet
                                                              (Dollars in Thousands)
                                                                   (Unaudited)
                                                                                 Twin County            Twin County
                                     C-TEC                                  Trans Video, Inc. July   Trans Video, Inc.
                                Corporation June    Cellular Disposition          31, 1994              Acquisition
                               30, 1994 (Actual)       Adjustments(a)            (Actual)(e)           Adjustments(b)     Pro Forma
                               ------------------   ---------------------   ----------------------   ------------------   ----------
<S>                            <C>                  <C>                     <C>                      <C>                  <C>
Current Assets
  Cash and temporary cash
    investments                       $47,328               $124,779                  $947               $(47,500)         $125,554
  Other current assets                 48,811                 12,783                 2,173                      -            63,767
  Deferred income taxes                 3,134                    (27)                1,390                      -             4,497
                                     --------               --------              --------               --------          --------
  Total current assets                 99,273                137,535                 4,510                (47,500)          193,818
                                     --------               --------              --------               --------          --------

Property, Plant and Equipment
  Telephone plant                     388,430                      -                     -                      -           388,430
  Cable plant                         180,902                      -                40,119                      -           221,021
  Mobile and Cellular Plant            30,468                (27,797)                    -                      -             2,671
  Other property, plant and equipment  12,143                      -                     -                      -            12,143
                                     --------               --------              --------               --------          --------
  Total property, plant and equipment 611,943                (27,797)               40,119                      -           624,265
  Accumulated depreciation            264,040                 (9,121)               23,948                (23,948)          254,919
                                     --------               --------              --------               --------          --------
  Net property, plant and equipment   347,903                (18,676)               16,171                 23,948           369,346
                                     --------               --------              --------               --------          --------
Investments                            14,771                 (1,283)                    -                      -            13,488
                                     --------               --------              --------               --------          --------
Intangible Assets, Net                 91,669                (33,236)                   45                109,177           167,655
                                     --------               --------              --------               --------          --------
Deferred Charges                       17,249                      -                 4,959                 (2,200)           20,008
                                     --------               --------              --------               --------          --------
Total Assets                         $570,865                 84,340               $25,685                $83,425          $764,315
                                     ========               ========              ========               ========          ========

LIABILITIES AND SHAREHOLDERS'
  EQUITY
Current Liabilities
  Current maturities of long-term
    debt and preferred stock           $9,449                  ($421)                    -                      -            $9,028
  Advance billings and customer
    deposits                            8,526                   (326)               $3,655                      -            11,855
  Accrued taxes                        11,684                      -                     -                      -            11,684
  Accrued interest                      6,567                    (37)                    -                      -             6,530
  Other current liabilities            34,513                 (3,215)                2,762                      -            34,060
                                     --------               --------              --------               --------          --------
  Total current liabilities            70,739                 (3,999)                6,417                      -            73,157
                                     --------               --------              --------               --------          --------
Long-Term Debt                        386,187                 (1,306)               11,941                 $4,000           400,822
                                     --------               --------              --------               --------          --------

Deferred Income Taxes and Investment
  Tax Credits                          30,572                 14,698                 1,372                 32,726            79,368
                                     --------               --------              --------               --------          --------
Other Deferred Credits                 19,718                      -                   654                      -            20,372
                                     --------               --------              --------               --------          --------
Minority Interest                       2,448                 (2,448)                    -                      -                 -
                                     --------               --------              --------               --------          --------
Exchangeable Preferred Stock
  of a Subsidiary                           -                      -                     -                 52,000            52,000
                                     --------               --------              --------               --------          --------
Redeemable Preferred Stock                274                      -                     -                      -               274
                                     --------               --------              --------               --------          --------
Common Shareholders' Equity
  Common Stock                         16,887                      -                   300                   (300)           16,887
  Additional paid-in capital           20,635                      -                     -                      -            20,635
  Retained earnings                    28,693                 77,395                 5,001                 (5,001)          106,088
  Treasury stock at cost, 377,842
    shares at June 30, 1994            (5,288)                     -                     -                      -            (5,288)
                                     --------               --------              --------               --------          --------

Total Shareholders' Equity             60,927                 77,395                 5,301                 (5,301)          138,322
                                     --------               --------              --------               --------          --------
Total Liabilities and Shareholders'
  Equity                             $570,865                $84,340               $25,685                $83,425          $764,315
                                     ========               ========              ========               ========          ========
</TABLE>



<TABLE>
<CAPTION>
                                                  Pro Forma Condensed Consolidated Statement of Operations
                                                           For the Six Months Ended June 30, 1994
                                                      (Dollars in Thousands Except Per Share Amounts)
                                                                        (Unaudited)
                                                 C-TEC                              Twin County
                                            Corporation Six                       Trans Video, Inc.     Twin County
                                              Months Ended       Cellular         Six Months Ended   Trans Video, Inc.
                                             June 30, 1994      Disposition        April 30, 1994       Acquisition         Pro
                                                (actual)       Adjustments (c)      (actual) (e)      Adjustments (f)     Forma (d)
                                            ----------------   ---------------    ----------------   -----------------   ----------
<S>                                         <C>                <C>                <C>                <C>                 <C>
Sales                                             $145,114         $(13,785)             $11,945                -         $143,274
Costs & Expenses                                   123,551          (12,264)               9,892           $6,315          127,494
                                                  --------         --------             --------         --------         --------
Operating Income                                    21,563           (1,521)               2,053           (6,315)         $15,780
Interest Income                                      1,250              (40)                  10                -            1,220
Interest Expense                                   (16,333)              79                 (418)            (100)         (16,772)
Gain on Sale of certain
  Pennsylvania Cable                                   893                -                    -                -              893
  Properties
Other Income, Net                                      613                3                    -                -              616
                                                  --------         --------             --------         --------         --------
Income (Loss) Before Income Taxes                    7,986           (1,479)               1,645           (6,415)           1,737
Provision for Income Taxes                           3,973           (1,008)                 775           (2,245)           1,495
                                                  --------         --------             --------         --------         --------
Income (Loss) Before Minority Interest
  and Equity in Unconsolidated Entities              4,013             (471)                 870           (4,170)             242

Preferred Dividends and Minority Interest
  in Income of Consolidated Entities                  (476)             429                    -           (1,300)          (1,347)

Equity in Income of Unconsolidated Entities            281              (91)                   -                -              190
                                                  --------         --------             --------         --------         --------

Income (Loss) Available for Common Stock Before
Extraordinary Charge and Cumulative Effect of
Accounting Principle Change (g)                     $3,818            $(133)                $870          $(5,470)           $(915)
                                                  ========         ========             ========         ========         ========

Earnings (Loss) Per Average Common Share:
Income before extraordinary charge and
cumulative effect of accounting principle change      $.23                                                                   $(.06)
                                                  ========         ========             ========         ========         ========

Average Common Shares Outstanding               16,509,593                                                              16,509,593
</TABLE>


<TABLE>
                                                       Pro Forma Condensed Consolidated Statement of Operations
                                                                 For the Year Ended December 31, 1993
                                                           (Dollars in Thousands Except Per Share Amounts)
                                                                             (Unaudited)

                                                                          Twin County
                                C-TEC Corporation                       Trans Video, Inc.       Twin County
                                    Year Ended         Cellular           Year Ended         Trans Video, Inc.
                                December 31, 1993     Disposition       October 31, 1993        Acquisition
                                     (actual)        Adjustments (c)      (actual) (e)        Adjustments (f)     Pro Forma (d)
                                -----------------    ---------------    -----------------    -----------------    -------------

<S>                             <C>                  <C>                <C>                  <C>                  <C>

Sales                                   $283,987        $(22,570)             $19,999                                $281,416
Costs & Expenses                         244,421         (22,924)              18,433          $(12,766)              252,696
Nonrecurring Charges                       5,025               -                    -                 -                 5,025
                                        --------         --------             --------         --------              --------

Operating Income                          34,541             354                1,566           (12,766)               23,695
Interest Income                            1,609               -                   15                 -                 1,624
Interest Expense                         (34,204)            184                 (827)             (200)              (35,047)
Gain on Sale of Marketable
  Equity Securities                        1,988               -                    -                 -                 1,988
Other Income, Net                          1,408             (62)                   -                 -                 1,346
                                        --------         --------             --------         --------              --------
Income (Loss) Before Income Taxes          5,342             476                  754           (12,966)               (6,394)
Provision for Income Taxes                10,714            (830)                 286            (4,408)                5,762
                                        --------         --------             --------         --------              --------
Income (Loss) Before Minority Interest
  and Equity in Unconsolidated
  Entities                                (5,372)          1,306                  468            (8,558)              (12,156)
Preferred Dividends and Minority
  Interest in income of
  Consolidated Entities                     (341)            256                    -            (2,600)               (2,685)
Equity in Income of Unconsolidated
  Entities                                   227            (155)                   -                 -                    72
                                        --------         --------             --------         --------              --------

Income (Loss) Available for Common Stock
  Before Extraordinary Charge and
  Cumulative Effect of Accounting
  Principle Change (g)                    (5,486)         $1,407                 $468          $(11,158)             $(14,769)
                                        ========         ========             ========         ========              ========

Earnings (Loss) Per Average
  Common Share:
  Income before extraordinary
  charge and cumulative effect
  of accounting principal change           $(.33)                                                                       $(.89)
                                        ========         ========             ========         ========              ========

Average Common Shares Outstanding     16,506,494                                                                   16,506,494
</TABLE>


         Notes to Pro Forma Condensed Consolidated Financial Statements

         (a)  Adjustments to record the disposition of certain cellular
properties.  The adjustments assume that the sales proceeds, net of certain
escrow reserves and holdbacks discussed below and net of income taxes
estimated to be payable after the utilization of certain net operating loss
carryforwards, are retained as temporary cash investments.  The escrow
reserves and holdbacks of approximately $16 million are included in other
current assets.  The adjustments assume the realization of deferred tax
assets of approximately $21 million, representing the tax benefits
associated with the utilization of approximately $54.7 million federal net
operating loss carryforwards and approximately $18.9 million state net
operating loss carryforwards.  The final resolution of the Company's
current IRS examination may impact the utilization of net operating loss
carryforwards.  Adjustments also assume a reduction in a related valuation
allowance for deferred tax assets of approximately $6 million.  An after-
tax gain of approximately $71 million was assumed to be recognized on the
sale.  Certain working capital adjustments to the sales price to be made
ninety days after closing were estimated to be approximately $7 million
based on the historical asset and liability balances at June 30, 1994.

         (b)  Adjustments to reflect the pending acquisition of Twin County.
The adjustments assume that the consideration for the acquisition will be
cash of approximately $47.5 million, a promissory note of $4 million, and
exchangeable preferred stock of C-TEC Cable Systems, Inc. with a
liquidation preference of $52 million (the "Cable Preferred Stock").  The
purchase price will reflect the fair value of the consideration for the
pending acquisition; such fair value may differ from assumptions used in
the preparation of the pro forma statements.  The purchase price has been
allocated based on assumptions of the fair values of the tangible and
identifiable intangible assets acquired and liabilities assumed.

         (c)  Adjustments to eliminate the historical results of operations of
certain cellular properties.  Corporate overhead allocated to cellular
operations has not been eliminated because that overhead would have been
reallocated to other business segments.

         (d)  The Pro Forma Consolidated Statements of Operations exclude a
non-recurring after-tax gain of approximately $71 million expected to be
realized on the sale, and the reversal of a valuation allowance for deferred
tax assets of approximately $6 million.

         (e)  Twin County has a fiscal year ending October 31.  Twin
County's most recent interim historical balance sheet as of July 31, 1994
is included in the pro forma condensed consolidated balance sheet.  Twin
County's statement of operations for the year ended October 31, 1993 is
included in the pro forma condensed consolidated statement of operations
for the year ended December 31, 1993.  Twin County's results of operations
for the six months ended April 30, 1994 which are included in the pro forma
condensed consolidated statement of operations for the six months ended
June 30, 1994 were derived from its most recent interim historical
statement of operations for the nine months ended July 31, 1994, as
follows:

<TABLE>
                                                                 Nine Months                            Six Months
                                                                    Ended                                  Ended
                                                                July 31, 1994       Adjustments       April 30, 1994
                                                               ----------------    --------------    -----------------
<S>                                                            <C>                 <C>               <C>

Sales                                                                  $18,208           $(6,263)             $11,945
Costs & Expenses                                                        15,677            (5,785)               9,892
                                                               ----------------    --------------    -----------------
Operating Income                                                         2,531              (478)               2,053
Interest Income                                                             20               (10)                  10
Interest Expense                                                          (661)              243                 (418)
Gain on sale of certain Pennsylvania Cable Properties                        -                 -                    -
Other Income, net                                                            -                 -                    -
                                                               ----------------    --------------    -----------------
Income Before Income Taxes                                               1,890              (245)               1,645
Provision for Income Taxes                                                 797               (22)                 775
                                                               ----------------    --------------    -----------------
Income Before Minority Interest and Equity in
Unconsolidated Entities                                                  1,093              (223)                 870
Equity in Income of Unconsolidated Entities                                  -                 -                    -
Minority Interest in Income of Consolidated Entities                         -                 -                    -
                                                               ----------------    --------------    -----------------
Income Before Extraordinary Charge and Cumulative
Effect of Accounting Principle Changes                                  $1,093             $(223)                $870
                                                               ================    ==============    =================
</TABLE>

   (f)  Adjustments to record additional depreciation and amortization
resulting from Twin County purchase price allocation and to increase
interest expense associated with a $4 million promissory note and to record
dividends of 5% on the $52 million of Cable Preferred Stock issued in
connection with the acquisition.

   (g)  For information purposes only, since 1989 C-TEC has maintained a
policy of not paying cash dividends.  C-TEC does not intend to alter this
policy in the foreseeable future.

                                  THE COMPANY

      The Company was organized in 1979.  It is incorporated under the laws
of the Commonwealth of Pennsylvania and has its principal office in
Princeton, NJ.  The Company is a holding company with wholly-owned
subsidiaries, which are engaged in various aspects of the
telecommunications industry and which are organized into five principal
groups - Telephone, Cable, Communications Services, Mobile Services, and
Long Distance.  Through its wholly owned subsidiaries, the Company also has
ownership interests in a number of other entities providing
telecommunications services.

      On or about October 29, 1993, RCN acquired 600,768 shares of Common
Stock and 5,094,223 shares of Class B Stock of the Company from a group
consisting of Andrew J. Sordoni III, William B. Sordoni, Stephen Sordoni and
Charles E. Parente (including entities wholly owned or controlled by any one
or more of them) (the "Sellers") pursuant to the terms of the Stock Purchase
Agreement dated June 17, 1993 among the Sellers, RCN and KDG.  The purchase
price paid by RCN was $202,327,191 and the source of such funds was RCN's and
its affiliates' working capital.  This transaction represented approximately
34% of the equity and approximately 57% of the voting control of the
Company.  RCN nominees currently constitute a majority of the Board of
Directors of the Company.

      Financial information regarding the Company's industry segments is
set forth in footnote 14 to the Consolidated Financial Statements included
in the Company's Annual Report on Form 10-K for the fiscal year ended
December 31, 1993, which is incorporated herein by reference.

      As of December 31, 1993, the Company had 1,282 full-time employees
including general office and administrative personnel.

Operations

      Telephone

      The Telephone Group consists of a Pennsylvania public utility providing
local telephone service to a 19 county, 5,067 square mile service territory in
Pennsylvania.  As of June 30, 1994, the Telephone Group provided service to
approximately 215,000 main access lines.  Of these 168,000 were residential
and 47,000 primarily related to business.  This Group's operating territory is
rural, containing only 42.4 access lines per square mile as compared to a
Pennsylvania average of approximately 151 lines per square mile.  The Group's
79 central offices serve an average of approximately 2,700 lines and 65 square
miles.

      In addition to providing local telephone service, this Group provides
network access and billing and collection services to interexchange carriers.
This Group also has other revenues which are considered non-regulated and
primarily relate to telecommunications equipment sales and services and
billing/collection services for interexchange long distance carriers.

      Intralata toll bypass and alternative local access telephone service
providers are potential competitive threats, although no significant
competition has occurred to date.  Intralata toll and access revenue comprise
a significant portion of the Group's business.

      Cable

      The Cable Group is a cable television operator with cable television
systems located in the States of New York, New Jersey, Michigan and Delaware.
The Group owns and operates cable television systems serving approximately
236,000 customers and manages cable television systems with an additional
36,000 customers, ranking it among the top 35 multiple system operators in the
United States. On October 12, 1994 the Company announced the pending
acquisition of Pennsylvania Cable Television provider, Twin County. For
information on the pending acquisition and pro forma effect of such pending
acquisition, see "Recent Developments" and "Pro Forma Condensed
Consolidated Financial Statements," respectively.

      During 1993, the Cable Group restructured rates and channel offerings to
comply with the basic rate regulations and to minimize the impact on revenue
of the Cable Act.  The future impact of the Cable Act on the Cable Group and
the cable television industry is still unclear.  The Cable Group's 1993
operating results were not significantly impacted by the Cable Act.  See
"Investment Considerations--Regulation."

      The Group's performance is dependent to a large extent on its ability to
obtain and renew its franchise agreements from local government authorities on
acceptable terms.  To date, all of the Group's franchises have been renewed or
extended, generally at or prior to their stated expirations and on acceptable
terms.  During 1993, the Cable Group completed negotiations with 64
communities resulting in franchise renewals on terms which are acceptable to
the Group.  The Cable Group has 369 franchises, 63 of which are due for
renewal within the next three years.  No one franchise accounts for more than
10% of the Group's total revenue.

      Competition for the Group's services traditionally has come from a
variety of providers including broadcast television, video cassette recorders
and home satellite dishes.  Direct broadcast satellite (DBS) which will allow
consumers to receive cable programming for a fee once they purchase a
receiving dish and a set-top terminal may increase competition in the future.
Two DBS companies have launched their services in 1994.  In addition,
recent changes in federal regulation allow telephone companies to lease
their networks to video programmers under the video dial-tone platform.
Also, the recently announced mergers of various telephone and cable
companies has heightened the concerns about competition in the future.  The
current regulatory environment appears to be fostering competition in cable
television by telephone companies, and in telephone by cable companies.
These regulations are still evolving.  The Cable and Telephone Groups
continue to monitor the progress of regulations affecting the
telecommunications industry and are developing a business plan to meet
future competition.  It is impossible to predict at this time the impact of
these technological and regulatory developments on the cable television
industry in general or on the Cable Group in particular.

      Mobile Services


      The Mobile Services Group previously operated cellular telephone
systems in MSAs and RSAs throughout eight counties in Northeastern and
Central Pennsylvania and 24 counties in Southeast Iowa, serving a total
population of 1.5 million.  On September 9, 1994, the Company completed the
sale of its cellular properties to ICN for approximately $182.5 million,
subject to certain adjustments to be made within 90 days after closing
estimated to result in approximately $7 million of additional proceeds.
For information on the pro forma effect of such sale, see "Pro Forma
Condensed Consolidated Financial Statements."

      The Group also operates paging and message management services in
Northeastern Pennsylvania.  These business units were not sold to ICN as a
part of the cellular sale.

      Communication Services

      The Communications Services Group presently carries on business
principally in the Northeastern United States providing telecommunications-
related engineering and technical services.  The Group headquarters is
located in Princeton, New Jersey and the services are provided out of
regional offices in Pennsylvania, New York, New Jersey and Virginia.

      The services provided by the Group include telephony engineering; system
integration; operation and management of telecommunications facilities for
large corporate clients, hospitals and universities; and installation of

premises distribution systems in large campus environments.  In addition, the
Communications Services Group sells, installs and maintains private branch
exchanges (PBXs) in Pennsylvania and New Jersey.  The Group has also expanded
its engineering services to include video and data engineering, and
successfully implemented several major projects during 1993.  These major
projects were contracts for the construction of integrated voice, video and
data distribution systems for a major university and for a governmental agency.

      The Group encounters major competition from interexchange carriers,
regional bell operating companies, independent telephone companies, system
integrators, interconnect companies and small independent consultants.  The
competition from various sources results in significant downward pressure on
the prices and margins for the services the Group provides.  The Group's cost
effective operations, competitive pricing, flexibility to meet customer
requirements, and reputation in the telecommunications industry for quality
service have been its primary strengths against the competition.

      Long Distance

      The Long Distance Group principally operates in Pennsylvania.  The Group
began operations in 1990 by servicing the local area of the Telephone Group.
In late 1992, the Long Distance Group entered the Wilkes-Barre/Scranton
territory served by Bell Atlantic.  In late 1993, the Group established sales
offices in additional markets in Philadelphia, Pittsburgh, Harrisburg and
Allentown.  The primary focus in these markets is to provide services to
residential and business customers.

      The Long Distance Group provides facility based services, is a
"reseller" of several types of services and employs the networks of several
long distance providers on a wholesale basis.  As a result of market share
growth, in 1993 the Group procured its own long distance switch which allows
customers to choose the Long Distance Group as their long distance provider
and dial the common "1+" to use the service.  This switched service enables
the Company to provide quality services such as private line services, 800
services, operating services and calling card services at reduced rates.  The
Group also provides telemarketing services, primarily to cable companies.

      Additionally, the Long Distance Group recognized the need for access to
AT&T services to sell nationwide to large business customers with multiple
locations.  In 1992, the Group procured access to AT&T Tariff 12 services
through a series of agreements.  The AT&T Tariff 12 arrangement is a regulated
tariff on file with the FCC pursuant to which AT&T services are provided at
specified rates.

      The interexchange (long-distance) carrier market is crowded and
competitive.  Recent industry surveys indicate an estimated 350-400
interexchange carriers in operation.  A key development was the rapid revenue
growth by regional and niche oriented companies.  Although the top three
carriers (AT&T, MCI and Sprint) account for almost 90% of all interexchange
carrier revenue, that share may decline as other interexchange carrier revenue
grows.

      Intense competition in the mid-sized business market reflects the rapid
growth of business customer revenue.  The residential market is still
dominated by the top three carriers.  However, this domination may decline
given increased price pressure combined with more aggressive marketing by the
regional carriers.

      In Pennsylvania, the Long Distance Group has mirrored the overall growth
statistics of the regional carriers.  Competition for the mid-sized business
market has come from other similarly situated carriers rather than the top
three.  The primary deviation from industry growth trends is seen in the
residential market segment in the Telephone Group's operating territories.
Here the Long Distance Group has continued to hold the predominant market
share.  A combination of value priced products, exceptional customer service
and aggressive marketing activities has been the Group's primary strength
against competition.

                         DESCRIPTION OF CAPITAL STOCK

      The following general summary of the Common Stock is qualified in its
entirety by reference to the Company's Amended and Restated Articles of
Incorporation, as further amended (the "Articles of Incorporation"), a copy of
which is on file with the Commission.  See "Available Information."

      The authorized capital stock of the Company is 43,753,203 shares,
consisting of 35,000,000 shares of Common Stock, par value $1.00 per share,
and 8,753,203 shares of Class B Stock, par value $1.00 per share.  As of
November 10, 1994, the Company had outstanding 7,962,266 shares of Common
Stock and 8,547,327 shares of Class B Stock.

Voting Rights and Powers

      With respect to all matters upon which shareholders are entitled to vote
(including the election of directors) or to which shareholders are entitled to
give consent, except as provided in the next sentence, the holders of the
outstanding shares of the Common Stock and the holders of any outstanding
shares of the Class B Stock shall vote together without regard to class, and
every holder of the outstanding shares of the Common Stock shall be entitled
to cast one vote for each share of the Common Stock held, and every holder of
any outstanding shares of the Class B Stock shall be entitled to cast fifteen
votes for each share of the Class B Stock held.  However, with respect to any
proposed amendment to the Articles of Incorporation which would (i) increase
or decrease the par value of any class, (ii) alter or change the preferences,
qualifications, limitations, restrictions or special or relative rights of the
shares of any class so as to affect the holders of such class adversely, (iii)
increase the authorized number of shares of any class, (iv) authorize a new
class of shares senior or superior in any respect to the shares of any class,
or (v) increase the number of authorized shares of any class senior or
superior in any respect to the shares of any class then authorized, the
approval of a majority of the votes entitled to be cast by the holders of the
class affected by the proposed amendment, voting separately as a class, shall
be obtained in addition to the approval of a majority of the votes entitled to
be cast by the holders of the Common Stock and the Class B Stock voting
together without regard to class as described above.

Dividends and Distributions

     Cash Dividends

      At any time shares of the Class B Stock are outstanding, as and when
cash dividends may be declared by the Board of Directors, the cash dividends
payable on shares of the Common Stock shall be in all cases at least 105% of
the cash dividend payable on shares of the Class B Stock.


     Other Dividends and Distributions


      In the case of dividends in the form of stock or other property of the
Company, each share of the Common Stock and each share of the Class B Stock is
equal in respect of rights and dividends except that in the case of dividends
or other distributions payable in stock or stock split-ups or divisions,
shares of the Class B Stock shall be distributed only with respect to the
Class B Stock and shares of the Common Stock may be distributed with respect
to both the Common Stock and the Class B Stock.

Other Rights

      Except as otherwise required by the Pennsylvania Business Corporation
Law or as otherwise provided in the Articles of Incorporation, each share of
the Common Stock and each share of the Class B Stock has identical powers,
preferences and rights, including rights in liquidation.

Conversion of Class B Stock

      Shares of Class B Stock shall be convertible at the option of the
respective holders thereof, at any time, into fully paid and nonassessable
shares of Common Stock on the basis of one share of Common Stock for each
share of Class B Stock.  Any holder of shares of the Class B Stock may elect
to convert any or all of such shares at one time or at various times, in such
holder's discretion.

      No payment or adjustment with respect to dividends on shares of the
Common Stock or on the Class B Stock shall be made in connection with any
conversion of shares of Class B Stock into shares of Common Stock except for
those shares of the Class B Stock converted subsequent to the record date for
the payment of a stock or cash dividend or other distribution on the shares of
the Class B Stock but prior to such payment.  In such an instance, the stock
or cash dividend or other distribution will be paid on the Class B Stock to the
registered holder of such shares as of the close of business on the record
date as if no conversion had been made.

      In the event of any capital reorganization or any reclassification of
the Common Stock (except for reorganizations or reclassifications involving a
subdivision or combination of outstanding shares of the Common Stock), the
shares of the Class B Stock shall thereafter have the right to be converted
into the number of shares of stock or other securities or property of the
Company to which outstanding shares of the Common Stock would have been
entitled upon the effective date of the reorganization or reclassification.

      If the shares of the Common Stock or the Class B Stock at any time
outstanding shall, by reclassification or otherwise, be subdivided into a
greater number of shares or combined into a lesser number of shares, the
shares of Class B Stock or Common Stock, respectively, then outstanding shall,
at the same time, be subdivided or combined, as the case may be, on the same
basis.

Liquidation Preferences

      In the event of dissolution, liquidation or winding up of the Company
whether voluntary or involuntary, holders of the Company Stock shall be
entitled to payment out of the assets of the Company ratably in accordance
with the number of shares held by them, respectively.

Duration of Class Rights and Powers

      At any time when less than 25,000 shares of Class B Stock are
outstanding any shares of the Class B Stock which are then outstanding shall
without any action by the Board of Directors or the holder or holders thereof,
automatically convert into and become for all purposes shares of Common Stock,
and the provisions of the Articles of Incorporation which provide for
different voting or cash dividend rights for the Common Stock and the Class B
Stock shall not be of any effect.  All shares of either or both the Common
Stock or the Class B Stock which are then outstanding shall have equal and
general voting power in all matters upon which shareholders of the Company are
entitled to vote or give consent, even if at such time there shall have been
fixed by the Board of Directors a record date for voting of any meeting of
shareholders.

General

      The transfer agent and registrar for the Company's shares of Common
Stock and Class B Stock is The First National Bank of Boston.

Common Stock Outstanding after Rights Offering

   
      Approximately 14,858,634 shares of Common Stock will be issued in
connection with the Rights Offering assuming exercise of all Rights.  Based on
the 7,962,266 shares of Common Stock outstanding as of November 10, 1994, the
issuance of such shares pursuant to the Rights Offering would result (on a pro
forma basis as of such date) in a 187% increase in the amount of
outstanding Common Shares.
    

      The outstanding shares of the Common Stock are listed on NASDAQ under
the symbol "CTEX."

                             PLAN OF DISTRIBUTION

   
      The Company has agreed to pay certain broker-dealers that have
entered into a Soliciting Dealer Agreement with the Company fees for their
soliciting efforts (the "Soliciting Fees") equal to $0.25 per share of
Common Stock for each share of Common Stock issued pursuant to the exercise
of Rights subject to a maximum Soliciting Fee of $250 in the case of each
person beneficially purchasing more than 1,000 shares of Common Stock
pursuant to the exercise of Rights.  The Soliciting Fees will be paid
directly to a broker-dealer designated on the applicable portion of the
Subscription Certificate.  Soliciting Fees will not be paid on any
undesignated exercise of Rights.
    

                              SUBSCRIPTION AGENT

      The Company has appointed The First National Bank of Boston as
Subscription Agent for the Rights Offering.  The Subscription Agent's address,
which is the address to which the Subscription Certificates and payment of the
Subscription Price (other than wire transfers) should be delivered, as well as
the address to which any Notice of Guaranteed Delivery must be delivered, is:

         By Mail:

         The First National Bank of Boston
         P.O. Box 1872
         Mail Stop 45-01-19
         Boston, Massachusetts
         02105-1872

         By Hand:

         BancBoston Trust Company of

           New York
         55 Broadway
         3rd Floor
         New York, New York
         10006

         By Overnight Courier:

         The First National Bank of Boston
         Shareholder Services Division
         150 Royall Street
         Mail Stop 45-01-19
         Canton, Massachusetts
         02021


      The Company will pay the fees and expenses of the Subscription Agent,
and has also agreed to indemnify the Subscription Agent from certain
liabilities in connection with the Rights Offering.



                               INFORMATION AGENT

         The Company has appointed MacKenzie Partners, Inc. as Information
Agent for the Rights Offering.  Any questions or requests for additional
copies of this Prospectus, the Instructions or the Notice of Guaranteed
Delivery may be directed to the Information Agent at the telephone number and
address below.

                           MacKenzie Partners, Inc.
                           156 Fifth Avenue
                           9th Floor
                           New York, New York 10010
                                      or
                           Call Toll Free
                           (800) 322-2885

The Company will pay the fees and expenses of the Information Agent and has
also agreed to indemnify the Information Agent from certain liabilities in
connection with the Rights Offering.

                                 LEGAL MATTERS

      The validity of the authorization and issuance of the securities offered
hereby is being passed upon by Raymond B. Ostroski, Vice President and General
Counsel of the Company.  Davis Polk & Wardwell, New York, New York, will
advise the Company with respect to certain other matters relating to the Rights
Offering.

                                    EXPERTS

      The Company consolidated balance sheets as of December 31, 1993 and
1992 and the consolidated statements of operations, common shareholders'
equity, and cash flows for each of the three years in the period ended
December 31, 1993, incorporated by reference in this Prospectus, have been
incorporated herein in reliance on the report, which includes an
explanatory paragraph referring to the Company's change in methods of
accounting for income taxes and postretirement benefits other than
pensions, of Coopers & Lybrand, independent accountants, given on the
authority of that firm as experts in accounting and auditing.


      The financial statements of Twin County Trans Video, Inc. as of and
for the years ended October 31, 1993 and 1992 incorporated by reference
herein to the Company's Current Report on Form 8-K filed with the
Commission on October 27, 1994, as amended on November 10, 1994, have been
incorporated by reference in reliance upon the report of Adams &
Associates, independent certified public accountants, and upon the
authority of that firm as experts in accounting and auditing.


   
No dealer, salesperson or any other person has
been authorized to give any information or to
make any representations other than those                        [LOGO]
contained or incorporated by reference in this
Prospectus in connection with the offer made by
this Prospectus, and, if given or made, such
information or representation must not be relied                  C-TEC
upon as having been sanctioned or authorized by                Corporation
the Company.  Neither the delivery of this
Prospectus nor any sale made hereunder shall
under any circumstances create any implication
that there has been no change in the affairs of the            14,858,634
Company since the date hereof.  This Prospectus                Shares of
does not constitute an offer or solicitation by               Common Stock
anyone in any jurisdiction in which the person                1.00 Par Value
making such offer or solicitation is not qualified to
do so or to any person to whom it is unlawful to
make such offer or solicitation.



                  TABLE OF CONTENTS

                                          Page
                                          ----

Available Information............           2
Documents Incorporated by
    Reference....................           2
Prospectus Summary...............           4
Investment Considerations........          12
Use of Proceeds..................          15
Corporate Strategy...............          16
Recent Developments..............          16
Price Range of Common Stock and
    Dividend Policy..............          18
Dilution.........................          19
The Rights Offering..............          19
Certain Federal Income Tax
    Consequences.................          27
Pro Forma Condensed Consolidated
    Financial Statements.........          29
The Company......................          33
Description of Capital Stock.....          36
Plan of Distribution.............          38
Subscription Agent...............          39                  PROSPECTUS
Information Agent................          39          Dated November 10, 1994
Legal Matters....................          40
Experts..........................          40
    

                                 PART II

                   INFORMATION NOT REQUIRED IN PROSPECTUS


Item 14.  Other Expenses of Issuance and Distribution

   
      The following table sets forth expenses in connection with the
issuance and distribution of the securities being registered.  All amounts
shown are estimated, except the SEC registration fee, the NASDAQ
National Market listing fees and the NASD review fee.

SEC registration fee.......................... $  114,998
NASDAQ listing fee............................     17,500
NASD review fee...............................     30,500
Soliciting Dealer Fees........................     25,000
Financial Advisor's fees and expenses.........    565,000
Subscription Agent's fees and expenses........     30,000
Information Agent's fees and expenses.........     37,500
Accounting fees...............................    104,000
Legal fees and expenses (including Blue Sky
  fees and expenses)..........................    350,000
Printing and engraving fees...................     30,000
Miscellaneous.................................     20,000
                                                ---------
      Total................................... $1,325,000
                                                =========

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


Item 15.  Indemnification of Directors and Officers

      Reference is made to Sections 1741 and 1742 of the 1988 Business
Corporation Law of the Commonwealth of Pennsylvania, which provide for
indemnification of directors and officers in certain circumstances.  In
addition, Article IV of the By-laws of C-TEC provides that, except as
prohibited by law, any director or officer of C-TEC is entitled to be
indemnified in any action or proceeding in which he or she may be involved
by virtue of holding such position.

      In addition, C-TEC maintains a directors' and officers' liability
insurance policy.

      For the undertaking with respect to indemnification, see Item 17
herein.


Item 16.  Exhibits

   
      5     -     Opinion of Raymond B. Ostroski

      23(a) -     Consent of Coopers & Lybrand

      23(b) -     Consent of Adams & Associates

      23(c) -     Consent of Raymond B. Ostroski (included in Exhibit 5)

      24(a) -     Power of attorney (included in the signature page to the
                  Registration Statement except in the case of the power of
                  attorney for Eugene Roth).*

      24(b) -     Power of attorney for Eugene Roth.*

      99(a) -     Form of Subscription Certificate.*

      99(b) -     Form of Instructions for Subscription Certificates.*

      99(c) -     Form of Notice of Guaranteed Delivery.*

      99(d) -     Form of Subscription Agency Agreement.

      99(e) -     Form of Soliciting Dealer Agreement.

- ---------------
* Previously filed.
    

Item 17.  Undertakings

      The undersigned registrant hereby undertakes that, for purposes of
determining any liability under the Securities Act of 1933, as amended,
each filing of the registrant's annual report pursuant to Section 13(a) or
15(d) of the Securities Exchange Act of 1934, as amended, that is
incorporated by reference in the registration statement 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.

     The undersigned registrant hereby undertakes that:

          (1)  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.

          (2)  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.

      Insofar as indemnification for liabilities arising under the
Securities Act of 1933, as amended, may be permitted to directors, officers
and controlling persons of the registrant pursuant to the provisions
referred to in Item 15 of this registration statement, 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 such 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
hereby, 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 such Act and will be governed by the
final adjudication of such issue.


                                SIGNATURES

   
     Pursuant to the requirements of the Securities Act of 1933, the
registrant hereby certifies that it has reasonable grounds to believe that
it meets all of the requirements for filing on Form S-3 and has duly caused
this Amendment to Registration Statement to be signed on its behalf by the
undersigned, thereunto duly authorized, in the city of Princeton, New
Jersey, on the 10th day of November, 1994.

                                        C-TEC CORPORATION


                                        By          *
                                          ______________________
                                             David C. McCourt
                                             Chairman and Chief
                                              Executive Officer

     Pursuant to the requirements of the Securities Act of 1933, this
Amendment to Registration Statement has been signed by the following
persons in the capacity and on the dates indicated.

        Signature                    Title                      Date
        ---------                    -----                      ----


            *
    -------------------       Director, Chairman and
     David C. McCourt         Chief Executive Officer      November 10, 1994


            *
    -------------------       President and
     Michael J. Mahoney       Chief Operating Officer      November 10, 1994


            *
    -------------------       Executive Vice President
       Bruce Godfrey          and Chief Financial Officer  November 10, 1994


            *
    -------------------       Director                     November 10, 1994
       James Q. Crowe


            *
    -------------------       Director                     November 10, 1994
    Walter E. Scott, Jr.


            *
    -------------------       Director                     November 10, 1994
     Richard R. Jaros

            *
    -------------------       Director                     November 10, 1994
     Robert E. Julian

            *
    -------------------       Director                     November 10, 1994
      Thomas C. Stortz

            *
    -------------------       Director                     November 10, 1994
     David C. Mitchell

            *
    -------------------       Director                     November 10, 1994
      Frank M. Henry

            *
    -------------------       Director                     November 10, 1994
    Donald G. Reinhard

            *
    -------------------       Director                     November 10, 1994
    Eugene Roth, Esquire

            *
    -------------------       Director                     November 10, 1994
     Stuart E. Graham

*By /s/ Raymond B. Ostroski
   ------------------------
        Raymond B. Ostroski
      Attorney-In-Fact
    


                                EXHIBIT INDEX


Exhibit
Number                 Description of Document
- -------                -----------------------

   

5               Opinion of Raymond B. Ostroski

23(a)           Consent of Coopers & Lybrand

23(b)           Consent of Adams & Associates

23(c)           Consent of Raymond B. Ostroski (included in Exhibit 5)

24(a)           Power of attorney (included in the signature page to the
                Registration Statement except in the case of the power of
                attorney for Eugene Roth).*

24(b)           Power of attorney for Eugene Roth.*

99(a)           Form of Subscription Certificate.*

99(b)           Form of Instructions for Subscription Certificates.*

99(c)           Form of Notice of Guaranteed Delivery.*

99(d)           Form of Subscription Agency Agreement.

99(e)           Form of Soliciting Dealer Agreement.

- --------------
 * Previously filed.
    

                                                                    Exhibit 5

                              Raymond B. Ostroski


                                       November 10, 1994


C-TEC Corporation
105 Carnegie Center
Princeton, NJ 08540


Ladies and Gentlemen:

               I am the Vice President and General Counsel of C-TEC
Corporation, a Pennsylvania corporation (the "Company"), and as such I have
acted as counsel for the Company in connection with the Registration Statement
on Form S-3, as amended (the "Registration Statement"), filed by the Company
with the Securities and Exchange Commission pursuant to the Securities Act of
1933, as amended (the "Act"), and the Rules and Regulations promulgated
thereunder (the "Rules"), and relating to (i) the distribution to holders of
record of shares of Common Stock, par value $1.00 per share, of the Company
("Common Stock") and to holders of record of shares of Class B Common Stock,
par value $1.00 per share, of the Company ("Class B Stock", and collectively
with the Common Stock, "Company Stock") nine transferable subscription rights
for every ten shares of Company Stock held of record at the close of business
on November 10, 1994 (plus such additional Rights as are necessary to round up
to whole Rights any fractional Rights to which beneficial owners of Company
Stock may be entitled) (collectively, the "Rights") and (ii) the shares of
Common Stock to be issued or delivered upon exercise of the Rights.

               I have examined originals or copies, certified or otherwise
identified to my satisfaction, of such documents, corporate records,
certificates of public officials and other instruments as I have deemed
necessary for the purpose of rendering this opinion.

               Based upon the foregoing, I am of the opinion that:

               1.    The Rights have been duly authorized and when validly
issued in accordance with such authorization, will constitute valid and
binding obligations of the Company enforceable against the Company in
accordance with their terms, subject to applicable bankruptcy, insolvency,
reorganization, moratorium and other similar laws affecting creditors' rights
generally and equitable principles of general applicability.

               2.    The Common Stock issuable or deliverable upon the
exercise of the Rights, when issued or delivered and paid for as contemplated
in the Registration Statement, will be validly issued, fully paid and
nonassessable.

               I am a member of the Bar of the Commonwealth of Pennsylvania
and the foregoing opinion is limited to the laws of the Commonwealth of
Pennsylvania and the Federal laws of the United States of America.

               I consent to the use of this opinion as an exhibit to the
Registration Statement and to the reference to my name under the caption
"Legal Matters" in the Prospectus included in the Registration Statement.  In
giving this consent, I do not thereby admit that I come within the category of
persons whose consent is required by the Act or the Rules.  This opinion is
rendered solely to you in connection with the above-captioned Registration
Statement.  This opinion may not be relied upon by you for any other purpose
or relied upon by or furnished to any other person without my prior written
consent.

                                       Very truly yours,

                                       /s/ Raymond B. Ostroski
                                       -------------------------
                                       Raymond B. Ostroski
                                       Vice President and General
                                       Counsel

                                                   Exhibit 23(a)



                      CONSENT OF INDEPENDENT ACCOUNTANTS


We consent to the incorporation by reference in this Amendment No. 5 to the
registration statement of C-TEC Corporation on Form S-3 (File No. 33-54433)
of our report, which includes an explanatory paragraph referring to the
Company's change in methods of accounting for income taxes and
postretirement benefits other than pensions, dated March 4, 1994, on our
audits of the consolidated financial statements and financial statement
schedules of C-TEC Corporation as of December 31, 1993 and 1992, and for
the years ended December 31, 1993, 1992 and 1991, which report is included
in C-TEC Corporation's Annual Report on Form 10-K for the fiscal year ended
December 31, 1993.  We also consent to the reference to our firm under the
caption "Experts".


                                               /s/ COOPERS & LYBRAND L.L.P.


Philadelphia, PA
November 10, 1994

                                                   Exhibit 23(b)



                      CONSENT OF INDEPENDENT ACCOUNTANTS


We consent to the incorporation by reference in this Amendment No. 5 to the
registration statement of C-TEC Corporation on Form S-3 (File No. 33-54433)
of our report dated November 9, 1994, on our audits or the financial
statements of Twin County Trans Video, Inc. as of October 31, 1993 and
1992, and for the years ended October 31, 1993 and 1992, which report is
included in C-TEC Corporation's Current Report on Form 8-K/A dated November
10, 1994.  We also consent to the reference to our firm under the caption
"Experts".



Adams & Associates, P.C.

/s/  Edward W. Adams, CPA
- -------------------------
     Edward W. Adams, CPA
     Managing Director
     Bethlehem, PA
     November 10, 1994

                         SUBSCRIPTION AGENCY AGREEMENT


          This Subscription Agency Agreement (the "Agreement") is made as
of November 10, 1994 between C-TEC Services, Inc.  ("Services") and The
First National Bank of Boston, as subscription agent (the "Agent").  All
terms not defined herein shall have the meaning given in the prospectus
(the "Prospectus") included in the (Registration Statement on Form S-3
(File No. 33-54433) filed by C-TEC Corporation (the "Company") with the
Securities and Exchange Commission on July 1, 1994, as amended by any
amendment filed with respect thereto (the "Registration Statement").

          WHEREAS, the Company proposes to make a subscription offer by
issuing certificates or other evidences of transferrable subscription
rights, in the form designated by the Company (the "Subscription
Certificates") to holders of record of shares (each a "Shareholder") of its
Common Stock, par value $1.00 per share (the "Common Stock"), and its Class
B Common Stock, par value $1.00 per share (the "Class B Stock, and
collectively with the Common Stock, the "Company Stock"), as of a record
date specified by the Company (the "Record Date"), pursuant to which each
shareholder will receive transferable subscription rights (the "Rights") to
subscribe for shares of Common Stock, as described in and upon such terms
as are set forth in the Prospectus included as a part of the Registration
Statement (the "Prospectus"); a final copy of the Prospectus has been or,
upon availability will promptly be, delivered to the Agent; and

          WHEREAS, Services wishes the Agent to perform certain acts on
behalf of the Company, and the Agent is willing to so act, in connection
with the distribution of the Subscription Certificates and the issuance and
exercise of the Rights to subscribe for Common Stock as therein set forth,
all upon the terms and conditions set forth herein.

          NOW, THEREFORE, in consideration of the foregoing and of the
mutual agreements set forth herein, the parties agree as follows:

1.  Appointment.  Services hereby appoints the Agent to act as subscription
agent for the Company in connection with the distribution of Subscription
Certificates and the issuance and exercise of the Rights in accordance with
the terms set forth in this Agreement and the Prospectus and the Agent
hereby accepts such appointment.

2.  Form and Execution of Subscription Certificates.  (a)  Each
Subscription Certificate shall be irrevocable.  The Agent shall, in its
capacity as Transfer Agent of the Company, maintain a register of
Subscription Certificates and the holders of record thereof (each of whom
shall be deemed a "Shareholder" hereunder for purposes of determining the
rights of holders of Subscription Certificates).  Each Subscription
Certificate shall, subject to the provisions thereof, entitle the
Shareholder in whose name it is recorded, or any transferee designated
therein, to the following:

          (1)  The right to purchase from the Company until the Expiration
Date, at the Subscription Price, a number of shares of Common Stock equal
to one share of Common Stock for each Right evidenced thereby (the "Basic
Subscription Privilege"); and

          (2)  The right to subscribe for additional shares of Common
Stock, subject to the availability of such shares and to the allotment of
such shares as may be available among Shareholders who exercise the
Oversubscription Privilege on the basis specified in the Prospectus;
provided, however, that such Shareholder has exercised the Basic
Subscription Privilege in respect of all Rights which he or she holds (the
"Oversubscription Privilege").

3.  Rights and Issuance of Subscription Certificates.  (a)  Each
Subscription Certificate shall evidence the Rights of the Shareholder
therein named to purchase shares of Common Stock upon the terms and
conditions therein and herein set forth.

          (b)  Upon the written authorization of the Company, signed by any
of its duly authorized officers, as to the Record Date, the Agent shall,
from a list of the Shareholders of Company Stock as of the Record Date to
be prepared by the Agent in its capacity as Transfer Agent of the Company,
prepare and record Subscription Certificates in the names of the
Shareholders, setting forth the number of Rights to subscribe for shares of
the Common Stock calculated on the basis of nine Rights for each ten shares
of Company Stock recorded on the books in the name of each such Shareholder
as of the Record Date.  The number of Rights distributed to each
Shareholder shall be rounded up to the nearest whole number.  No
Subscription Certificate may be divided in such a way as to permit the
holder of such certificate to receive a greater number of Rights than the
number to which such Subscription Certificate entitles its holder, except
that a depository, bank, trust company, or securities broker or dealer
holding shares of Company Stock, on the Record Date for more than one
beneficial owner may, upon execution and delivery to the Agent of a
Certification and Request for Additional Rights, substantially in the form
attached hereto as Exhibit A, exchange its Subscription Certificate to
obtain a Subscription Certificate for the number of Rights to which all
such beneficial owners in the aggregate would have been entitled had each
been a Holder on the Record Date.

          (c)  Each Subscription Certificate shall be dated as of the
Record Date and shall be executed manually or by facsimile signature of a
duly authorized officer of the Agent.  Upon the written advice, signed as
aforesaid, as to the effective date of the Registration Statement, the
Agent shall promptly countersign and deliver the Subscription Certificates,
together with a copy of the Prospectus, instructions as to the use of the
Subscription Certificates and any other document as the Company deems
necessary or appropriate, to all Shareholders with record addresses in the
United States (including its territories and possessions and the District
of Columbia).  No Subscription Certificate shall be valid for any purpose
unless so executed.  Delivery to Shareholders with record address inside
the United States shall be by first class mail (without registration or
insurance).  For those Shareholders having a record address outside the
United States or who have an APO or FPO address ("Foreign Shareholders")
(who will not receive Subscription Certificates and will receive only
copies of the Prospectus, instructions as to the use of the Subscription
Certificates and other documents as the Company deems necessary or
appropriate, if any), delivery shall be by air mail (without registration
or insurance) and by first class mail (without registration or insurance,)
to those Shareholders having APO or FPO addresses.

          (d)  The Rights evidenced by Subscription Certificates issued to
Foreign Shareholders will be held by the Agent for such Foreign
Shareholders' accounts until instructions are received to exercise, sell or
transfer the Rights.  To exercise such rights, such a Foreign Shareholder
must notify the Agent on or prior to 11:00 a.m., New York City time, on
November 23, 1994, and must establish to the satisfaction of the Agent that
such exercise is permitted under applicable law.  If such a holder does not
notify the Agent and provide acceptable instructions to the Agent by such
time, such Rights represented thereby will be sold by the First National
Bank of Boston, as agent, if feasible, and the net proceeds, if any,
remitted to such Foreign Shareholders.  If the Rights can be sold, sales of
such Rights will be deemed to have been effected at the weighted average
price received by the Agent on the day such Rights are sold, less any
applicable brokerage commissions, taxes and other expenses.

4.  Exercise.  (a)  Shareholders may acquire shares of Common Stock
pursuant to the Basic Subscription Privilege, and, if available, pursuant
to the Oversubscription Privilege by delivery to the Agent as specified in
the Prospectus of (i) the Subscription Certificate with respect thereto,
duly executed by such Shareholder in accordance with and as provided by the
terms and conditions of the Subscription Certificate, together with (ii)
the purchase price of $[ ] for each share of Common Stock subscribed for by
exercise of such Rights (the "Subscription Price"), in U.S. dollars by wire
transfer or by money order or check drawn on a bank in the United States,
in each case payable to the order of the Agent.  In the case of holders of
Rights that are held of record through a Depository (as defined below),
exercises of the Basic Subscription Privilege (but not the Oversubscription
Privilege) may be effected by instructing the Depository to transfer Rights
(such Rights "Depository Rights") from the Depository's account of such
holder to the Depository account of the Agent, together with payment of the
Subscription Price for each Underlying Share subscribed for pursuant to the
Basic Subscription Privilege.  The Oversubscription Privilege in respect of
Depository Rights may not be exercised through the Depository.  The holder
of a Depository Right may exercise the Oversubscription Privilege in
respect of such Depository Right by properly executing and delivering to
the Agent at or prior to 5:00 p.m., New York City time, on the Expiration
Date, a Nominee Holder Oversubscription Exercise Form, substantially in the
form attached hereto as Exhibit B or a Notice of Guaranteed Delivery,
together with payment of the appropriate Subscription Price for the number
of Underlying Shares for which the Oversubscription Privilege is to be
exercised.  Any Rights holder subscribing for an aggregate of more than
5,000 shares pursuant to the Oversubscription Privilege prior to the
Expiration Date shall not be required to deliver payment for such number of
underlying shares in excess of 5,000 until the Expiration Date.  Payments
will be deemed to have been received by the Agent only upon (i) clearance
on any uncertified check (for purposes hereof, an uncertified check will be
deemed to clear when the Agent has received good funds therefrom), (ii)
receipt by the Agent of any certified check or money order or (iii) receipt
of good funds by wire transfer to the Agent's account.  The Company, in its
sole discretion, may determine to waive payment for such excess number of
shares until after the Expiration Date and after all prorations and
adjustments contemplated by the terms of the Rights Offering have been
effected.  Nominees, (as defined below) who, on behalf of beneficial
owners, exercise the Basic Subscription Privilege and who wish to exercise
the Oversubscription Privilege, must properly execute and deliver to the
Agent at or prior to 5:00 p.m., New York City time, on the Expiration Date
a Nominee Holder Oversubscription Exercise Form and a Nominee Holder
Certification, substantially in the form attached hereto as Exhibit C.

          (b)  Rights may be exercised at any time after the date of
issuance of the Subscription Certificates with respect thereto but no later
than 5:00 P.M.  New York time on the Expiration Date.  For the purpose of
determining the time of the exercise of any Rights, delivery of any
material to the Agent shall be deemed to occur when such materials are
received at the Shareholder Services Division of the Agent specified in the
Prospectus.  Once a Shareholder has exercised the Basic Subscription
Privilege or the Oversubscription Privilege, such exercise may not be
revoked.

          (c)  Notwithstanding the provisions of Section 4(a) and 4(b)
regarding delivery of an executed Subscription Certificate to the Agent
prior to 5:00 P.M.  New York time on the Expiration Date, if prior to such
time the Agent receives a Notice of Guaranteed Delivery by facsimile
(telecopy) or otherwise from a member firm of a registered national
securities exchange or a member of the National Association of Securities
Dealers, Inc., or from a commercial bank or trust company having an office
or correspondent in the United States (each, an "Eligible Institution")
guaranteeing delivery of a properly completed and executed Subscription
Certificate, then such exercise of the Basic Subscription Privilege and
Oversubscription Privilege shall be regarded as timely, subject, however,
to receipt of (i) the duly executed Subscription Certificate by the Agent
within five NASDAQ trading days after the Expiration Date (the "Protect
Period") and (ii) payment in full of the subscription price (subject to the
right of the Company to waive advance payment in respect of the
Oversubscription Privilege as described above) prior to 5:00 p.m. on the
Expiration Date.

          (d)  As soon as practicable after the valid exercise of Rights
(for purposes hereof an exercise will not be treated as valid until such
time as the Agent receives good funds), the Agent shall send to each
exercising Shareholder (an "Exercising Shareholder")  (or, if shares of any
Company Stock on the Record Date are held by Depository Trust Company,
Midwest Securities Trust Company, Philadelphia Depository Trust Company
(each a "Depository") or any other depository or nominee (together with the
Depositories, "Nominees"), to such Nominee) the share certificates
representing the shares of Common Stock acquired pursuant to the Basic
Subscription Privilege.  As soon as practicable after the Expiration Date
and after all pro rations and adjustments contemplated by the terms of the
Rights Offering have been effected, the Agent shall send to each Exercising
Shareholder or Nominee who exercises an Oversubscription Privilege
certificates representing the shares of Common Stock acquired pursuant to
the Oversubscription Privilege, along with a letter explaining the
allocation of shares of Common Stock pursuant to the Oversubscription
Privilege.  (Any excess payment to be refunded by the Company to an
Exercising Shareholder who is not allocated the full amount of shares of
Common Stock subscribed for pursuant to the Oversubscription Privilege,
shall be mailed by the Agent to him or her without interest or deduction as
soon as practicable after the Expiration Date and after all prorations and
adjustments contemplated by the terms of the Rights Offering have been
effected.)

          (e)  If an exercising Rights holder has not indicated the number
of Rights being exercised, or if the Subscription Price payment forwarded
by such holder to the Agent is not sufficient (subject to the fifth
sentence of Section 4(a) above) to purchase the number of shares subscribed
for, the Rights holder will be deemed to have exercised the Basic
Subscription Privilege with respect to the maximum number of whole Rights
which may be exercised for the Subscription Price delivered to the Agent
and, to the extent that the Subscription Price payment delivered by such
holder exceeds the Subscription Price multiplied by the number of Rights
exercised (such excess being the "Subscription Excess"), the holder will be
deemed to have exercised its Oversubscription Privilege to purchase, to the
extent available, a number of whole Underlying Shares equal to the quotient
obtained by dividing the Subscription Excess by the Subscription Price.

          (f)  From the proceeds of the Offering, the Agent will pay
amounts due to Soliciting Dealers in accordance with the terms of the
Soliciting Dealer Agreement dated as of November 10, 1994 among the Company
and the Soliciting Dealers.

5.  Transfer or Sale of Rights.  (a)  Any Shareholder may transfer (i) all
of the Rights evidenced by a Subscription Certificate by properly endorsing
the Subscription Certificate or (ii) some of the Rights evidenced by a
Subscription Certificate (but not fractional Rights) by delivering to the
Agent such Subscription Certificate properly endorsed for transfer, with
instructions to register the Rights to be transferred in the name of the
transferee (and to issue a new Subscription Certificate to the transferee
evidencing such transferred Rights).  In such event, the Agent shall issue
a new Subscription Certificate evidencing the balance of the Rights to the
Shareholder or, if so instructed, to an additional transferee.  For
purposes of this Agreement the term "properly endorsed for transfer" shall
mean that each and every signature of a registered Shareholder or
Shareholders or assigns shall be made and guaranteed by an Eligible
Institution.  All transfer taxes and other governmental charges arising
from a transfer shall be paid by the transferring Shareholder.

          (b)  Any Shareholder may place an order with the Agent to sell
all or some of the Rights evidenced by a Subscription Certificate by
delivering to the Agent such Subscription Certificate properly executed for
sale by the Agent.  In the event that such holder places an order with the
Agent to sell some of the Rights evidenced by the Subscription Certificate,
such Shareholder shall instruct the Agent as to the action to be taken with
respect to the Rights that are not to be sold, and the Agent shall take
such action.  Promptly following such sale, the Agent shall send the
Shareholder a check for the net proceeds from the sale of any such Rights.
If the Rights can be sold, sales of such Rights will be deemed to have been
effected at the weighted average price received by the Agent on the day
such Rights are sold, less any applicable brokerage commissions, taxes and
other expenses, provided that the Company shall pay the fees of the Agent
in respect of such sales.  Orders to sell Rights must be received by the
Agent not later than 11:00 a.m.  New York City time on November 23, 1994.
The Agent's obligation to execute orders is subject to its ability to find
buyers.

6.  Validity of Subscriptions.  Irregular subscriptions not otherwise
covered by specific instructions herein shall be submitted to an
appropriate officer of the Company and handled in accordance with his or
her instructions.  Such instructions will be documented by the Agent
indicating the instructing officer and the date thereof.

7.  Oversubscription.  If, after allocation of shares of Common Stock to
Exercising Shareholders, there remain shares not subscribed for through the
Basic Subscription Privilege (the "Excess Shares"), then the Agent shall
allocate such Excess Shares to Shareholders who have exercised all the
Rights initially issued to them and who wish to acquire more than the
number of shares for which the Rights issued to them are exercisable.  If
the number of shares for which the Oversubscription Privilege has been
exercised is greater than the Excess Shares, the Agent shall allocate pro
rata the Excess Shares among the Shareholders exercising the
Oversubscription Privilege based on the number of shares each Shareholder
exercising the Oversubscription Privilege has purchased pursuant to the
Basic Subscription Privilege; provided, however, that if such pro rata
allocation results in any Shareholder being allocated a greater number of
Excess Shares than such Shareholder subscribed for pursuant to the exercise
of such Shareholder's Oversubscription Privilege, then such Shareholder
will be allocated only such number of Excess Shares as such Shareholder
subscribed for and the remaining Excess Shares will be allocated among all
other Shareholders exercising the Oversubscription Privilege.  The
percentage of Excess Shares each oversubscribing Shareholder may acquire
will be rounded up or down to result in delivery of whole shares of Common
Stock.  The Agent shall advise the Company immediately upon the completion
of the allocation set forth above as to the total number of shares
subscribed and distributable.

8.  Delivery of Certificates.  The Agent will deliver (i) certificates
representing those shares of Common Stock purchased pursuant to exercise of
the Basic Subscription Privilege as soon as practicable after the
corresponding Rights have been validly exercised and full payment for such
shares has been received and cleared and (ii) certificates representing
those shares purchased pursuant to the exercise of the Oversubscription
Privilege as soon as practicable after the Expiration Date and after all
prorations and adjustments contemplated by the Rights Offering have been
effected, but in no event shall share certificates be delivered after the
time period set forth in Section 4(d) hereof.  The Agent will include a
copy of the Prospectus with each certificate delivered, unless a Prospectus
was previously delivered to such Shareholder.

9.  Holding Proceeds of Rights Offering in Escrow.  (a)  All proceeds
received by the Agent from Shareholders in respect of the exercise of
Rights shall be held by the Agent, on behalf of the Company, in a
segregated, interest-bearing escrow account (the "Escrow Account").  As
soon as practicable after the receipt of any proceeds in respect of the
exercise of the Basic Subscription Privilege, the Agent shall deliver all
such proceeds to the Company, together with any interest thereon.

          (b)  The Agent shall deliver all proceeds received in respect of
the exercise of the Oversubscription Privilege (including interest earned
thereon) to the Company as promptly as practicable, but in no event later
than 10 business days after all prorations and adjustments contemplated by
the terms of the Rights Offering have been effected.  Pending delivery to
the Company as provided herein or disbursement in the manner described in
Section 4(d) above, funds held in the Escrow Account shall be invested by
the Agent at the direction of the Company.

10.  Reports.  Daily, during the period commencing with the mailing of the
Subscription Certificates and ending on the Expiration Date (and in the
case of guaranteed deliveries pursuant to Section 4(c), the period ending
five NASDAQ trading days after the Expiration Date) the Agent will report
by telephone or telecopier (by 12:00)  Noon, New York time), confirmed by
letter, to an officer of the Company, data regarding Rights exercised, the
total number of shares of Common Stock subscribed for, and payments
received therefor, bringing forward the figures from the previous day's
report in each case so as to show the cumulative totals and any such other
information as may be reasonably requested by the Company.

11.  Loss or Mutilation;  Cancellation.  (a)  If any Subscription
Certificate is lost, stolen, mutilated or destroyed, the Agent may, on such
terms which will indemnify and protect the Company and the Agent as the
Agent and the Company shall agree (which shall, in the case of a mutilated
Subscription Certificate include the surrender and cancellation thereof),
issue a new Subscription Certificate of like denomination in substitution
for the Subscription Certificate so lost, stolen, mutilated or destroyed.

          (b)  All Subscription Certificates surrendered for the purpose of
exercise, exchange, substitution or transfer shall be canceled by the
Agent, and no Subscription Certificates shall be issued in lieu thereof
except as expressly permitted by provisions of this Agreement.  The Company
shall deliver to the Agent for cancellation and retirement, and the Agent
shall so cancel and return, any other Subscription Certificate purchased or
acquired by the Company otherwise than upon the exercise thereof.  The
Agent shall deliver all canceled Subscription Certificates to the Company,
or shall, at the written request of the Company, destroy such canceled
Subscription Certificates, and in such case shall deliver a certificate of
destruction thereof to the Company.

12.  Compensation for Services.  The Company agrees to pay to the Agent
certain fees, as set forth in the schedule hereto, for services performed
hereunder, which services include any other services not described herein
but customarily performed by the Subscription/Escrow Agent in a rights
offering.  The Company further agrees that it will reimburse the Agent for
its reasonable out-of-pocket expenses incurred in the performance of its
duties as such.

13.  Instructions and Indemnification.  The Agent undertakes the duties
and obligations imposed by this Agreement upon the following terms and
conditions:

          (a)  The Agent shall be entitled to rely upon any instructions or
directions furnished to it by an appropriate officer of the Company,
whether in conformity with the provisions of this Agreement or constituting
a modification hereof or a supplement hereto.  Without limiting the
generality of the foregoing or any other provision of this Agreement, the
Agent, in connection with its duties hereunder, shall not be under any duty
or obligation to inquire into the validity or invalidity or authority or
lack thereof of any instruction or direction from an appropriate officer of
the Company which conforms to the applicable requirements of this Agreement
and which the Agent reasonably believes to be genuine and shall not be
liable for any delays, errors or loss of data occurring by reason of
circumstances beyond the Agent's control, including, without limitation,
acts of civil or military authority, national emergencies, labor
difficulties, fire, flood, catastrophe, acts of God, insurrection, war,
riots or failure of the mails, transportation, communication or power
supply.

          (b)  The Company will indemnify the Agent for, and hold it
harmless against, any liability and expense which may arise out of or in
connection with the services described in this Agreement or the
instructions or directions furnished to the Agent relating to this
Agreement by an appropriate officer of the Company; provided, however, that
such agreement does not extend to, and the Agent shall not be indemnified
or held harmless with respect to any liability or expense which shall arise
out of, or be incurred or suffered as a result of, the Agent's negligence,
bad faith, misconduct or breach of this Agreement.  The Company shall not
indemnify the Agent with respect to any claim or action settled without its
consent, which consent shall not be unreasonably withheld.

          (c)  The Agent will promptly notify the Company of any claim with
respect to which it may seek indemnity hereunder.  The Company shall be
entitled to participate at its own expense in the defense of any suit
brought to enforce any such claim, and if the Company so elects, the
Company shall assume the defense of any such suit.  In the event that the
Company assumes such defense, the Company shall not thereafter be liable
for the fees and expenses of any additional counsel that the Agent retains,
so long as the Company shall retain counsel reasonably satisfactory to the
Agent, to defend such suit.

14.  Changes in Subscription Certificate.  The Agent may, without the
consent or concurrence of the Shareholders in whose names Subscription
Certificates are registered, by supplemental agreement or otherwise, concur
with the Company in making any changes or corrections in a Subscription
Certificate that it shall have been advised by counsel (who may be counsel
for the Company) is appropriate to cure any ambiguity or to correct any
defective or inconsistent provision or clerical omission or mistake or
manifest error therein or herein contained, and which shall not be
inconsistent with the provision of the Subscription Certificate except
insofar as any such change may confer additional rights upon the
Shareholders.

15.  Assignment, Delegation.  (a)  Neither this Agreement nor any rights or
obligations hereunder may be assigned or delegated by either party without
the written consent of the other party.

          (b)  This Agreement shall inure to the benefit of and be binding
upon the parties and their respective permitted successors and assigns.
Nothing in this Agreement is intended or shall be construed to confer upon
any other person any right, remedy or claim or to impose upon any
other person any duty, liability or obligation.

16.  Governing Law.  The validity, interpretation and performance of this
Agreement shall be governed by the law of the State of New York.

17.  Severability.  The parties hereto agree that if any of the provisions
contained in this Agreement shall be determined invalid, unlawful or
unenforceable to any extent, such provisions shall be deemed modified to
the extent necessary to render such provisions enforceable.  The parties
hereto further agree that this Agreement shall be deemed severable, and the
invalidity, unlawfulness or enforceability of any term or provision thereof
shall not affect the validity, legality or enforceability of this Agreement
or of any other term or provision hereof.

18.  Counterparts.  This Agreement may be executed in one or more
counterparts, each of which shall be deemed an original and all of which
together shall be considered one and the same agreement.

19.  Captions.  The captions and descriptive headings herein are for the
convenience of the parties only.  They do not in any way modify, amplify,
alter or give full notice of the provisions hereof.

20.  Facsimile Signatures.  Any facsimile signature of any party hereto
shall constitute a legal, valid and binding execution hereof by such party.

21.  Further Actions.  Each party agrees to perform such further acts and
execute such further documents as are necessary to effect the purposes of
this Agreement.

22.  Additional Provisions.  Except as specifically modified by this
Agreement, the Agent's rights and responsibilities set forth in the
Agreement for Stock Transfer Services between the Company and the Agent are
hereby ratified and confirmed and continue in effect.

               IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be duly executed as of the day and year first above written.


                                 THE FIRST NATIONAL BANK OF BOSTON



                                 By: _____________________________
                                     Name:
                                     Title:



                                 C-TEC SERVICES, INC.



                                 By: _____________________________
                                     Name:
                                     Title:


                               SCHEDULE OF FEES
                    FOR SUBSCRIPTION/ESCROW AGENT SERVICES

                                    between

                             C-TEC SERVICES, INC.

                                      and

                       THE FIRST NATIONAL BANK OF BOSTON

A.       TERM

         The term of this Agreement shall be for a period of six (6) months,
         commencing from the effective date of this Agreement, November 10,
         1994.

B.       FEE FOR SERVICES

         $22,500.00 - Administrative fee to include:

            bullet   Subscription Certificate issued and mailed (if Machine
                     Enclosed)
            bullet   Subscription Certificates Received and Processed, up to
                     2,000 items; excess to be billed at $8.00 each
            bullet   Defective Subscription Certificates Received and
                     Processed (Telephone Calls if Necessary), up to 250
                     Items; excess to be billed at $12.00 each
            bullet   Notices of Guaranteed Delivery Received
            bullet   Per Withdrawal of Subscription Certificate, if
                     Applicable, up to 100 withdrawals; excess to be billed at
                     $10.00 each
            bullet   Sales of Rights, up to 400 items; excess to be billed at
                     $8.00 each
            bullet   Over Subscription, Proration, (if applicable)
            bullet   Per Each Dealer Solicitation Form Received, up to 50
                     Items; excess to be billed at $5.00 each
            bullet   Other services customary for a transaction of this type
____________________

         $ 2,500.00 - Escrow Agent Fee to Handle Daily
               Investment of Funds Received



                                                                  EXHIBIT A


                CERTIFICATION AND REQUEST FOR ADDITIONAL RIGHTS


To the Subscription Agent:

         The undersigned hereby certifies that it is a broker-dealer
registered with the Securities and Exchange Commission, commercial bank or
trust company, securities depository or participant therein, or nominee
therefor, holding of record ___________ shares of Common Stock, par value
$1.00 per share (the "Common Shares"), and _________ shares of Class B
Common Stock, par value $1.00 per share (the "Class B Stock", and
collectively with the Common Stock, the "Company Stock") of C-TEC
Corporation (the "Company") on behalf of __________ beneficial owners as of
the close of business on November 10, 1994, the Record Date for the
offering by the Company of 14,858,634 shares of Common Stock pursuant to
transferable subscription rights (the "Rights") being distributed to record
holders of shares of Company Stock, all as described in a Prospectus dated
November 10, 1994 (the "Prospectus"), a copy of which the undersigned has
received.  Nine Rights are being distributed for each ten shares of Company
Stock held of record as of the close of business on the Record Date, and
any fractional Right will be rounded up to the nearest whole number.  The
undersigned further certifies that _________ beneficial owners on whose
behalf it held, as of the close of business on the Record Date, _________
shares of Company Stock registered in the name of the undersigned are each
entitled to an additional Right in accordance with the principle that any
fractional Right to which a beneficial owner would otherwise be entitled
should be rounded up to the nearest whole number.  Accordingly, the
undersigned requests that, upon surrender of its Subscription Certificate
evidencing _________ Rights, a Subscription Certificate evidencing
_________ Rights (including _________ additional Rights) be issued.  The
undersigned further certifies that each such beneficial owner is a bona
fide beneficial owner of shares of Company Stock, that such beneficial
ownership is reflected on the undersigned's records and that all shares of
Company Stock which, to the undersigned's knowledge, are beneficially owned
by any such beneficial owner through the undersigned have been aggregated
in calculating the foregoing.  The undersigned agrees to provide the
Company or its designee with such additional information as the Company
deems necessary to verify the foregoing.


                                 ________________________
                                 Name of Record Holder


                                 By:_____________________

                                    Name:
                                    Title:
                                    Address:
                                    Telephone Number:

                                 Date: ______________,1994


                                                               EXHIBIT B

                               C-TEC CORPORATION RIGHTS OFFERING



                 NOMINEE HOLDER OVERSUBSCRIPTION EXERCISE FORM PLEASE
                  COMPLETE ALL APPLICABLE INFORMATION


By Mail:                                By Express Mail or Overnight:
The First National Bank of Boston       The First National Bank of Boston
P.O.  Box 1872                          Shareholder Services Division
Mail Stop 45-01-19                      150 Royall Street
Boston, Massachusetts                   Mail Stop 45-01-19
02105-1872                              Canton, Massachusetts 02021

                         By Hand:
                         BancBoston Trust Company of New York
                         55 Broadway 3rd Floor
                         New York, New York

   THIS FORM IS TO BE USED ONLY BY NOMINEE HOLDERS TO EXERCISE THE
OVERSUBSCRIPTION PRIVILEGE IN RESPECT OF RIGHTS WITH RESPECT TO WHICH THE
BASIC SUBSCRIPTION PRIVILEGE WAS EXERCISED TO THE FULLEST EXTENT POSSIBLE
AND DELIVERED THROUGH THE FACILITIES OF A COMMON DEPOSITORY.  ALL OTHER
EXERCISES OF OVERSUBSCRIPTION PRIVILEGES MUST BE EFFECTED BY THE DELIVERY
OF SUBSCRIPTION CERTIFICATES.

   THE TERMS AND CONDITIONS OF THE RIGHTS OFFERING ARE SET FORTH IN THE
COMPANY'S PROSPECTUS DATED [ ], 1994 (THE ``PROSPECTUS'')  AND ARE
INCORPORATED HEREIN BY REFERENCE.  COPIES OF THE PROSPECTUS ARE AVAILABLE
UPON REQUEST FROM THE INFORMATION AGENT, MACKENZIE PARTNERS, INC.  AT (800)
322-2885.

   THIS FORM OR A NOTICE OF GUARANTEED DELIVERY MUST BE RECEIVED BY THE
SUBSCRIPTION AGENT WITH PAYMENT IN FULL BY 5:00 P.M., NEW YORK CITY TIME,
ON [ ], 1994 (THE ``EXPIRATION DATE'').

   1.  The undersigned hereby certifies to the Company and the Subscription
Agent that it is a participant in _________________________[Name of
Depository] (the ``Depository'') and that it has either (1) exercised the
Basic Subscription Privilege in respect of Rights and delivered such
exercised Rights to the Subscription Agent by means of transfer to the
Depository Account of the Company or (ii) delivered to the Subscription
Agent a Notice of Guaranteed Delivery in respect of the exercise of the
Basic Subscription Privilege and will deliver the Rights called for in and
in accordance with such Notice of Guaranteed Delivery to the Subscription
Agent by means of transfer to such Depository Account of the Company.

   2.  The undersigned hereby exercises the Oversubscription Privilege to
purchase, to the extent available, _______ shares of Common Stock and
certifies to the Company and the Subscription Agent by execution of a
Nominee Holder Certification that such Oversubscription Privilege is being
exercised for the account or accounts of persons (which may include the
undersigned) on whose behalf all Basic Subscription Rights have been
exercised to the fullest extent possible.

   3.  The undersigned understands that payment of the Subscription Price
of $[ ] per share for each share of Common Stock subscribed for pursuant to
the Oversubscription Privilege must be received by the Subscription Agent
at or before 5:00 p.m., New York City time, on the Expiration Date and
represents that such payment, in the aggregate amount of $____________,
either (check appropriate box):

  box  has been or is being delivered to the Subscription Agent [pursuant
       to the Notice of Guaranteed Delivery referred to above]

                                    or

  box  is being delivered to the Subscription Agent herewith

                                    or

  box  has been delivered separately to the Subscription Agent;and, in the
       case of funds not delivered pursuant to a Notice of Guaranteed
       Delivery, is or was delivered in the manner set forth below (check
       appropriate box and complete information relating thereto):

  box  wire transfer of funds

       -- name of transferor institution....................................

       -- date of transfer..................................................

       -- confirmation number (if available)................................

  box  uncertified check

  box  certified check

  box  bank draft (cashier's check)


                                   ........................................
                                   Basic Subscription Confirmation Number

                                   ........................................
                                   Depository Participant Number

                                   ........................................
                                   Name of Depository Participant


                                   By......................................
                                     Name:
                                     Title:

Dated: _______________, 1994


PARTICIPANTS EXERCISING THE OVERSUBSCRIPTION PRIVILEGE PURSUANT HERETO MUST
SEPARATELY SUBMIT A NOMINEE HOLDER CERTIFICATION TO THE SUBSCRIPTION AGENT.
SUCH NOMINEE HOLDER CERTIFICATIONS ARE AVAILABLE FROM THE SUBSCRIPTION
AGENT.


                                                                 EXHIBIT C

                               C-TEC CORPORATION

                         NOMINEE HOLDER CERTIFICATION


   The undersigned, a bank, broker or other nominee holder of Rights
(``Rights'') to purchase shares of Common Stock, par value $1.00 per share
(``Common Stock''), of C-TEC Corporation (the ``Company'') pursuant to the
rights offering (the "Rights Offering") described and provided for in the
Company's prospectus dated November 10, 1994, (the ``Prospectus''), hereby
certifies to the Company and to The First National Bank of Boston, as
Subscription Agent for such Rights Offering, that (1) the undersigned has
exercised, on behalf of beneficial owners thereof, (which may include the
undersigned), the number of Rights specified below pursuant to the Basic
Subscription Privilege (as defined in the Prospectus) on behalf of
beneficial owners of Rights who have subscribed for the purchase of
additional shares of Common Stock pursuant to the Oversubscription
Privilege (as defined in the Prospectus);  (2) the undersigned has listed
below each such exercised Basic Subscription and the corresponding
Oversubscription Privilege (without identifying any such beneficial owner)
and (3) each such beneficial owner's Basic Subscription has been exercised
to the fullest extent possible:

               Number of        Number of
               Rights           Rights
               Exercised        Exercised
               Pursuant         Pursuant                         Estimated
               to Basic         to Over-          Rights         Soliciting
               Subscription     subscription      Certificate    Dealer
               Privilege        Privilege         Number         Fee Due*
               ------------     ------------      -----------    ----------


 1.            ____________     ____________      ___________    __________

 2.            ____________     ____________      ___________    __________

 3.            ____________     ____________      ___________    __________

 4.            ____________     ____________      ___________    __________

 5.            ____________     ____________      ___________    __________

 6.            ____________     ____________      ___________    __________

 7.            ____________     ____________      ___________    __________

 8.            ____________     ____________      ___________    __________

 9.            ____________     ____________      ___________    __________

10.            ____________     ____________      ___________    __________

            (Attach additional beneficial owner list if necessary)

                                                  ____________________________
                                                  Name of Nominee Holder


_______________________________________________   ____________________________
Depository Participant Number (if applicable)     Address

_______________________________________________
Basic Subscription Confirmation Number(s)         By: ________________________
                                                      Name:             (Date)
                                                      Title:
                                                      Telephone Number:


*  The Company will pay Soliciting Dealers that have entered into a
   Soliciting Dealer Agreement with the Company fees for their soliciting
   efforts (the "Soliciting Fees") equal to $0.25 per share of Common Stock
   for each share of Common Stock issued pursuant to the exercise of
   Rights; such Soliciting Fee with respect to exercised rights shall be
   paid to the broker_dealer, if any, designated on the applicable portion
   of the subscription certificate, provided that such Soliciting Fee shall
   not exceed $250 in the case of any person beneficially purchasing more
   than an aggregate of 1,000 Common Shares pursuant to the exercise of
   Rights.  In the event that the Oversubscription Privilege is not
   allocated in full, the Estimated Soliciting Dealer Fee will be reduced
   accordingly.

                          SOLICITING DEALER AGREEMENT


Ladies and Gentlemen:

          C-TEC Corporation, a Pennsylvania corporation (the "Company"),
proposes to issue to holders (the "Common Holders") of its outstanding
Common Stock, par value $1.00 per share (the "Common Stock"), and to
holders (the "Class B Holders" and collectively with the Common Holders,
the "Holders") of its outstanding shares of Class B Common Stock, par value
$1.00 per share (the "Class B Stock" and collectively with the Common
Stock, the "Company Stock"), transferable rights entitling such Holders to
subscribe for shares of Common Stock (each a "Share" and, collectively, the
"Shares"; such issuance is herein referred to as the "Offer").  Pursuant to
the terms of the Offer, the Company is issuing each Holder [   ] transferable
rights (each a "Right" and, collectively, the "Rights") for each [   ] shares
of Company Stock held on the record date set forth in the accompanying
Prospectus (the "Prospectus").  Such Rights entitle Holders to acquire
during the period set forth in the Prospectus, and at the subscription
price set forth in the Prospectus, one Share for each Right held on the
terms and subject to the conditions set forth in the Prospectus.

               The Company is seeking to form for purposes of soliciting
exercises of Rights pursuant to the Offer, a group of soliciting dealers
consisting of brokers and dealers who shall be members in good standing of the
National Association of Securities Dealers, Inc. (the "NASD") or brokers or
dealers not registered under the Securities Exchange Act of 1934, as amended
(the "Exchange Act"), with their principal place of business located outside
the United States, its territories or possessions who agree to solicit
exercises of Rights only in accordance with the laws applicable to such
activities and agree to solicit no exercises of Rights within the United
States, its territories or its possessions or from persons who are nationals
thereof or residents therein and who agree, although not members of the NASD,
to conform to the Rules of Fair Practice of the NASD, in soliciting exercises
of Rights outside the United States, its territories and possessions, to the
same extent as though they were members thereof (the members of such group
being hereinafter called the "Soliciting Dealers").  You are invited to become
one of the Soliciting Dealers and by your confirmation hereof you agree to act
in such capacity, in accordance with the terms and conditions herein and in
your confirmation hereof, to obtain exercises of Rights pursuant to the Offer.

               1.  Solicitation and Solicitation Material.  Solicitation and
other activities by you hereunder shall be undertaken only in accordance with
this Agreement, the Securities Act of 1933, as amended (the "Securities Act"),
the Exchange Act, and the applicable rules and regulations of the Securities
and Exchange Commission.  Accompanying this Agreement are copies of the
following documents:  the Prospectus describing the terms of the Offer, a form
of the Subscription Certificate, a Blue Sky Memorandum and letters to
stockholders.  Additional copies of these documents will be supplied in
reasonable quantities upon your request.  You agree that during the period of
the Offer you will not use any solicitation material other than that referred
to above and such as may hereafter be furnished to you by us.

               2.  Compensation of Soliciting Dealers.  As compensation for
the services of the Soliciting Dealers hereunder, the Company will pay to each
Soliciting Dealer a fee in the amount of $0.25 per Share for each Share issued
pursuant to the Offer through such Soliciting Dealer's efforts, including the
exercise of Rights by a Soliciting Dealer for its own account pursuant to the
exercise of Rights; provided that such soliciting fee shall not exceed $250 in
the case of any person beneficially purchasing more than an aggregate of 1000
Shares pursuant to the exercise of Rights.  A Soliciting Dealer shall be
entitled to the foregoing compensation only where the insertion of such
Soliciting Dealer's name has been made on the Subscription Certificate in the
place so provided and where the Company shall have received from such
Soliciting Dealer an executed copy of this Agreement in the form hereof.

               No compensation shall be payable in respect of any particular
exercise of Rights if, in the opinion of counsel for the Company, such
compensation cannot legally be paid in respect of such exercise of Rights
because of the provisions of applicable state law or for any other reason.  In
case of any dispute or disagreement as to the amount of compensation payable
to any Soliciting Dealer hereunder, or, in the event of any dispute or
disagreement as to the proper recipient of any such compensation, the decision
of the Company shall be conclusive.

               For the purpose of this Section 2, the Offer will expire on the
expiration date (the "Expiration Date") set forth in the Prospectus.  No
compensation will be payable to Soliciting Dealers with respect to Rights
exercised after expiration of the Offer.

               3.  Trading.  (a) You represent and warrant that (i) you have
not engaged and will not engage in any activity in respect of the Shares, the
Class B Stock or the Rights in violation of the Exchange Act or the rules and
regulations thereunder, including without limitation Rules 10b-6, 10b-7 and
10b-8 under the Exchange Act and (ii) you have and will conform to the Rules
of Fair Practice of the NASD in respect of the Shares, the Class B Stock and
the Rights.

               (b)  Acceptance of compensation by you will constitute a
representation that you are eligible to receive such compensation and that you
have complied and will comply with the preceding provision and your other
agreements hereunder.

               4.  Unauthorized Information and Representations.  Neither you
nor any other person is authorized by the Company to give any information or
make any representations in connection with this Agreement or the Offer other
than those contained in the Prospectus and other authorized solicitation
material furnished by the Company, and you hereby agree not to use any
solicitation material other than material referred to in this Section 4.
Without limiting the generality of the foregoing, you agree not to publish,
circulate or otherwise use any other advertisement or solicitation material
without the prior written approval of the Company.  You are not authorized to
act as agent of the Company in any respect, and you agree not to act as such
agent and not to purport to act as such agent.  On becoming a Soliciting
Dealer and in soliciting exercises of Rights, you agree to comply with any
applicable requirements of the Securities Act, the Exchange Act, and the rules
and regulations thereunder, and to perform and comply with the agreements set
forth in your confirmation of your acceptance of this Agreement, a copy of the
form of which is appended hereto.

               5.  Blue Sky and Securities Laws.  The enclosed Blue Sky
Memorandum indicates the states in which it is believed that acceptances of
the Offer may be solicited under the applicable Blue Sky or securities laws.
Under no circumstances will you as a Soliciting Dealer engage in any
activities hereunder in any state (a) which is not listed in said enclosed
Blue Sky Memorandum as a state in which acceptances of the Offer may be
solicited under the Blue Sky or securities law of such state or (b) in which
you may not lawfully so engage.  The Blue Sky Memorandum shall not be
considered solicitation material as that term is herein used.  You authorize
the undersigned to cause to be filed in the Department of State of the State
of New York a Further State Notice with respect to the Shares complying with
the provisions of Article 23-A of the General Business Law of the State of New
York, if required by such provisions. You hereby represent that you, your
affiliates and your associated persons (as defined for purposes of the
Rules of fair Practice of the NASD) do not (and, during the term of this
Agreement, will not) collectively own 10% or more of the common equity of
the Company.

               6.  Termination.  This Agreement may be terminated by written
or telegraphic notice to you from the Company, or to the Company from you, and
in any case it will terminate upon the expiration or termination of the Offer;
provided, however, that such termination shall not relieve the Company of the
obligation to pay when due all fees payable to you hereunder with respect to
Shares acquired pursuant to the exercise of Rights through the close of
business on the date of such termination or relieve the Company of its
obligations referred to under Section 8 hereof, and shall not relieve you of
any obligation or liability under Sections 3, 4, 5, 9 and 10 hereof.

               7.  Liability of Company.  Nothing herein contained shall
constitute the Soliciting Dealers partners with one another, or agents of the
Company, or shall render the Company liable for the obligations of any
Soliciting Dealers, nor constitute the Company the agent of any Soliciting
Dealer.  The Company shall be under no liability to any Soliciting Dealer or
any other person for any act or omission or any matter connected with this
Agreement or the Offer, except that the Company shall be liable for
obligations expressly assumed by the Company in Section 2 of this Agreement
and the Company shall be liable on the basis set forth in Section 8 hereof to
indemnify certain persons.

               8.  Indemnification.  (a)  The Company agrees to indemnify and
hold harmless each Soliciting Dealer, the directors, officers, employees and
agents of each Soliciting Dealer and each person who controls any Soliciting
Dealer within the meaning of the Securities Act or the Exchange Act against
any and all losses, claims, damages or liabilities, joint or several, to which
they or any of them may become subject under the Securities Act, the Exchange
Act or other Federal or state statutory law or regulation, at common law or
otherwise, insofar as such losses, claims, damages or liabilities (or actions
in respect thereof) arise out of or are based upon any untrue statement or
alleged untrue statement of a material fact contained in the Prospectus (as
amended or supplemented if such Prospectus is amended or supplemented) or
arise out of or are based upon the omission or alleged omission to state
therein a material fact required to be stated therein or necessary to make the
statements therein not misleading and the Company agrees to reimburse each
such indemnified party, as incurred, for any legal or other expenses
reasonably incurred by them in connection with investigating or defending any
such loss, claim, damage, liability or action.  The foregoing indemnity
agreement is in addition to any liability which the Company may otherwise have.

               (b)   Promptly after receipt by an indemnified party under this
Section 8 of notice of the commencement of any action, such indemnified party
will, if a claim in respect thereof is to be made against the Company under
this Section 8, notify the Company in writing of the commencement thereof; but
the failure so to notify the Company will not relieve it from any liability
under paragraph (a) above unless and to the extent the Company is prejudiced
thereby.  The Company shall be entitled to appoint counsel of the Company's
choice at the Company's expense to represent the indemnified party in any
action for which indemnification is sought (in which case the Company shall
not thereafter be responsible for the fees and expenses of any separate
counsel retained by the indemnified party or parties except as set forth
below); provided, however, that such counsel shall be reasonably satisfactory
to the indemnified party.  Notwithstanding the Company's election to appoint
counsel to represent the indemnified party in an action, the indemnified party
shall have the right to employ separate counsel (including local counsel), and
the Company shall bear the reasonable fees, costs and expenses of such
separate counsel if (i) the use of counsel chosen by the Company to represent
the indemnified party would present such counsel with a conflict of interest,
(ii) the Company shall not have employed counsel reasonably satisfactory to
the indemnified party to represent the indemnified party within a reasonable
time after notice of the institution of such action or (iii) the Company shall
authorize the indemnified party to employ separate counsel at the expense of
the Company.  The Company will not, without the prior written consent of an
indemnified party, which consent shall not be unreasonably withheld, settle or
compromise or consent to the entry of any judgment with respect to any pending
or threatened claim, action, suit or proceeding in respect of which
indemnification or contribution may be sought hereunder (whether or not such
indemnified party is an actual party to such claim or action) unless such
settlement, compromise or consent includes an unconditional release of such
indemnified party from all liability arising out of such claim, action, suit
or proceeding.  The Company shall not be liable for any settlement, compromise
or consent effected without its prior written consent, which consent shall not
be unreasonably withheld.

               (c)   In the event that the indemnity provided in paragraph (a)
of this Section 8 is unavailable to or insufficient to hold harmless an
indemnified party for any reason, the Company agrees to contribute to the
aggregate losses, claims, damages and liabilities (including legal or other
expenses reasonably incurred in connection with investigating or defending
same) (collectively "Losses") to which the Company and one or more of the
Soliciting Dealers may be subject in such proportion as is appropriate to
reflect the relative benefits received by the Company and by the Soliciting
Dealers from the offering of the Shares and Rights; in no case shall any
Soliciting Dealer be responsible for any amount in excess of the amounts
received by such Soliciting Dealer pursuant to Section 2 hereof.  If the
allocation provided by the immediately preceding sentence is unavailable for
any reason, the Company and the Soliciting Dealers shall contribute in such
proportion as is appropriate to reflect not only such relative benefits but
also the relative fault of the Company and of the Soliciting Dealers in
connection with the statements or omissions which resulted in such Losses as
well as any other relevant equitable considerations.  Benefits received by the
Company shall be deemed to be equal to the total net proceeds from the
Offering (before deducting expenses), and benefits received by the Soliciting
Dealers shall be deemed to be equal to the total amounts received by the
Soliciting Dealers pursuant to Section 2 hereof.  Relative fault shall be
determined by reference to whether any alleged untrue statement or omission
relates to information provided by the Company or not.  The Company and the
Soliciting Dealers agree that it would not be just and equitable if
contribution were determined by pro rata allocation or any other method of
allocation which does not take account of the equitable considerations
referred to above.  Notwithstanding the provisions of this paragraph (c), no
person guilty of fraudulent misrepresentation (within the meaning of Section
11(f) of the Securities Act) shall be entitled to contribution from any person
who was not guilty of such fraudulent misrepresentation.  For purposes of this
Section 8, each person who controls a Soliciting Dealer within the meaning of
either the Securities Act or the Exchange Act and each director, officer,
employee and agent of a Soliciting Dealer shall have the same rights to
contribution as such Soliciting Dealer, and each person who controls the
Company within the meaning of either the Securities Act or the Exchange Act,
each officer of the Company who shall have signed the Registration Statement
relating to the Offering and each director of the Company shall have the same
rights to contribution as the Company, subject in each case to the applicable
terms and conditions of this paragraph (c).

               9.  Delivery of Prospectus.  You agree to deliver to each
person who owns beneficially shares of Company Stock registered in your name,
and who exercises Rights on a Subscription Certificate on which your name, to
your knowledge, has been inserted, a Prospectus prior to the exercise of such
person's Rights.

               10.  Status of Soliciting Dealer.  You (a) represent that you
are a member in good standing of the NASD or (b) represent that you are a
broker or dealer with your principal place of business located outside the
United States, its territories or its possessions and not registered under the
Exchange Act, and you agree (1) to solicit exercises of Rights only in
accordance with the laws applicable to such activities and to solicit no
exercises of Rights within the United States, its territories or possessions
or from persons who are nationals thereof or residents therein, and (2) that,
although not a member of the NASD, in acting under this Agreement you will
conform to the Rules of Fair Practice of the NASD, including Sections 8, 24
and 36 of Article III thereof, in soliciting exercises of Rights outside the
United States, its territories and possessions to the same extent as though
you were a member thereof.

               11.  Notices.  Any notice hereunder shall be in writing or by
telegram and if to you as a Soliciting Dealer shall be deemed to have been
duly given if mailed or telegraphed to you at the address to which this letter
is addressed.

               12.  Parties in Interest.  The Agreement herein set forth is
intended for the benefit of the Soliciting Dealer and the Company.

               13.  Confirmation.  Please confirm your agreement to become one
of the Soliciting Dealers under the terms and conditions set forth herein and
in the attached confirmation by completing and executing the confirmation and
sending it via facsimile to C-TEC Corporation, 105 Carnegie Center, Princeton,
NJ  08540, 609-734-3830, Attention: Chief Financial Officer with a copy to The
First National Bank of Boston, 617-575-2233.

               14.   Fee Confirmation.  Promptly upon expiration of the
offering, please complete and forward to The First National Bank of Boston via
facsimile (617-575-2233) the Appendix to this Agreement.  You represent and
warrant that the information set forth in the Appendix will be complete and
accurate, and you agree to verify such information upon request.

               NOTICE:  If the Confirmation is not signed, dated and returned
as set forth above prior to the expiration of the Offer, no fees will be
payable hereunder.

                                 Very truly yours,

                                 C-TEC CORPORATION


                                 By:________________________________
                                     Name:    Bruce Godfrey
                                     Title:   Executive Vice President
                                               and Chief Financial Officer

Dated: November 10, 1994


                ALL QUESTIONS CONCERNING THE SOLICITING DEALER
                   AGREEMENT SHOULD BE DIRECTED TO MACKENZIE
                   PARTNERS, INC., TOLL FREE AT 800-322-2885


                                 CONFIRMATION

C-TEC Corporation
105 Carnegie Center
Princeton, NJ  08540

Attention:  Bruce Godfrey, Executive Vice President
                   and Chief Financial Officer
                 Facsimile: (609) 734-3830
                 Telephone: (609) 734-3802

                 with a copy to:

                 The First National Bank of Boston
                 Facsimile: (617) 575-2233
                 Telephone: (617) 575-2700

Ladies and Gentlemen:

          We hereby confirm our acceptance of the terms and conditions of
the letter captioned "Soliciting Dealer Agreement" which was attached
hereto upon our receipt hereof (this "Agreement") with reference to the
Offer of C-TEC Corporation (the "Company") described therein.  We hereby
acknowledge receipt of the Prospectus and other solicitation material
referred to in this Agreement, and confirm that in executing this
confirmation we have relied upon such Prospectus and other solicitation
material authorized by the Company and upon no other representations
whatsoever, written or oral.  We also confirm that we are a broker or
dealer who is a member in good standing of the National Association of
Securities Dealers, Inc. or a broker or dealer not registered under the
Securities Exchange Act of 1934 with its principal place of business
located outside the United States, its territories or possessions who by
signing below also (a) agrees to solicit exercises of Rights only in
accordance with the laws applicable to such activities and to solicit no
exercises of Rights within the United States, its territories or its
possessions, or from persons who are nationals thereof or residents therein
and (b) agrees, although not a member of such Association, to conform to
the Rules of Fair Practice of such Association in acting under this
Agreement in soliciting exercises of Rights outside the United States, its
territories and possessions, to the same extent as though we were a member
thereof.  In connection with the offer, we represent that we have complied,
and agree that we will comply, with any applicable requirements of the
Securities Act of 1933, the Securities Exchange Act of 1934, any applicable
securities or Blue Sky laws and the rules and regulations under the
Securities Act of 1933, the Securities Exchange Act of 1934 and any
applicable securities or Blue Sky laws.  We also represent that we, our
affiliates and our associated persons (as defined for purposes of the Rules
of Fair Practice of the NASD) do not (and, during the term of this
Agreement, will not) collectively own 10% or more of the common equity of
the Company.

                                           __________________________________
                                                       Firm Name


                                           By:_______________________________
                                                  Authorized Signature


                                           Address:

                                           __________________________________

                                           __________________________________


Dated:  _______________, 1994

               NOTICE:  If a copy of this Confirmation is not signed, dated
and returned to the Company prior to the expiration of the Offer, no fees will
be payable hereunder.


                      C-TEC CORPORATION RIGHTS OFFERING
                   APPENDIX TO SOLICITING DEALER AGREEMENT
                   TO BE COMPLETED BY THE SOLICITING DEALER


Name and Address      __________________________________________________
of Soliciting Dealer  __________________________________________________
                      __________________________________________________


                     Number of Shares           Numbers of Shares
                     Subscribed for             Subscribed for
                     Pursuant to the Basic      Pursuant to the
Beneficial           Subscription               Oversubscription
Owners   *           Privilege                  Privilege
- -----------------    -----------------------    -----------------------

Owner No. 1
_______________________________________________________________________
Owner No. 2
_______________________________________________________________________
Owner No. 3
_______________________________________________________________________
Owner No. 4
_______________________________________________________________________
Owner No. 5
_______________________________________________________________________
Owner No. 6
_______________________________________________________________________
Owner No. 7
_______________________________________________________________________
Owner No. 8
_______________________________________________________________________
Owner No. 9
_______________________________________________________________________
Owner No.10
_______________________________________________________________________
Owner No.11
_______________________________________________________________________
Owner No.12
_______________________________________________________________________
Owner No.13
_______________________________________________________________________
Owner No.14
_______________________________________________________________________
Owner No.15
_______________________________________________________________________
Owner No.16
_______________________________________________________________________
Owner No.17
_______________________________________________________________________
Owner No.18
_______________________________________________________________________
Owner No.19
_______________________________________________________________________
Owner No.20
_______________________________________________________________________

* Names of Beneficial Owners need not be provided


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