NATIONAL MEDIA CORP
S-3, 1998-09-25
CATALOG & MAIL-ORDER HOUSES
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<PAGE>

   As filed with the Securities and Exchange Commission on September 25, 1998

                                                     Registration No. 333-______

                       SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549

                                ----------------
                                    FORM S-3
                             REGISTRATION STATEMENT
                                      UNDER
                           THE SECURITIES ACT OF 1933
                                 ---------------

                           NATIONAL MEDIA CORPORATION
             (Exact name of registrant as specified in its charter)

                                    Delaware
         (State or other jurisdiction of incorporation or organization)

                                   13-2658741
                     (I.R.S. Employer Identification Number)

                             15821 Ventura Boulevard
                                    Suite 570
                            Encino, California 91416

                    (Address of principal executive offices)

            Brian J. Sisko, Senior Vice President and General Counsel
                         Eleven Penn Center, Suite 1100
                               1835 Market Street
                        Philadelphia, Pennsylvania 19103
                     (Name and address of agent for service)

                                 (215) 988-4600
          (Telephone number, including area code, of agent for service)
                               ------------------

Approximate date of commencement of proposed sale to the public: As soon as
practicable after the Registration Statement becomes effective.

If the only securities being registered on this form are being offered pursuant
to dividend or interest reinvestment plans, 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
investment plans. Check the following box. |X|

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

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

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

Pursuant to Rule 429 under the Securities Act of 1933, as amended, the Form of
Prospectus included herein also relates to the securities registered under the
Registrant's Registration Statement on Form S-3 (Reg. No. 333-48205) declared
effective by the Securities and Exchange Commission (the "Commission") on April
16, 1998, is intended for use therewith, and constitutes a post-effective
amendment thereto.



<PAGE>

                         CALCULATION OF REGISTRATION FEE

<TABLE>
<CAPTION>

                                                             Proposed              Proposed           Amount of
  Title of Securities           Amount to be             Maximum Offering      Maximum Aggregate    Registration
   to be Registered              Registered               Price Per Share       Offering Price           Fee
<S>                          <C>                      <C>                   <C>                  <C>
  Common Stock, par value
  $.01 per share                4,318,579 (1)            $3.375/share (2)       $14,575,204(2)      $4,300.00(2)
- -------------------------------------------------------------------------------------------------------------------
</TABLE>

(1)    5,750,000 shares of Registrant's Common Stock issuable upon conversion of
       the ValueVision Note and exercise of the 1995 ValueVision Warrants and
       1998 ValueVision Warrants have been previously registered on a
       Registration Statement on Form S-3 declared effective by the Commission
       on April 16, 1998 (Reg. No. 333-48205) (the "Prior Registration
       Statement") and a registration fee of $3,817.00 (based on a market price
       of $2.25 per share of Common Stock) was paid in connection therewith.
       Pursuant to Rule 416(a) under the Securities Act of 1933, as amended (the
       "Securities Act"), the number of shares of Common Stock set forth in the
       Calculation of Registration Fee Table issuable in respect of the
       ValueVision Note, the 1995 Warrants and the 1998 Warrants is subject to
       adjustment by reason of stock splits, stock dividends, and other similar
       transactions in the Common Stock.

(2)    Based on the average of the high and low sales price of the Registrant's
       Common Stock as reported by the New York Stock Exchange on September 21,
       1998, as estimated solely for the purpose of calculating the registration
       fee in accordance with Rule 457(c) under the Securities Act of 1933, as
       amended.


The Registrant hereby amends this registration statement on such date or dates
as may be necessary to delay its effective date until the Registrant shall file
a further amendment which specifically states that this registration statement
shall thereafter become effective in accordance with section 8(a) of the
Securities Act or until the registration statement shall become effective on
such date as the Securities and Exchange Commission, acting pursuant to said
section 8(a), may determine.




<PAGE>

"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."





<PAGE>

                              SUBJECT TO COMPLETION

PROSPECTUS

                           NATIONAL MEDIA CORPORATION
                         Eleven Penn Center, Suite 1100
                               1835 Market Street
                        Philadelphia, Pennsylvania 19103
                                 (215) 988-4600

                      ------------------------------------
                        10,068,579 Shares of Common Stock
                      ------------------------------------


         This prospectus concerns the offer and sale by the selling stockholder
named herein (the "Selling Stockholder"), from time to time, of up to 10,068,579
common shares (the "Offered Shares"), par value $.01 per share (the "Common
Stock") of National Media Corporation (together with its subsidiaries, the
"Company" or the "Registrant").

         The Offered Shares (the "Conversion Shares") consist of the shares of
Common Stock issuable by the Company upon conversion by the Selling Stockholder
of a promissory note executed by the Company held by the Selling Stockholder, as
amended by a letter agreement, dated August 11, 1998, between NM Acquisition
Co., LLC, the Selling Stockholder and the Company (the "ValueVision Note") and
upon exercise of the 1995 Warrants and 1998 Warrants issued by the Company to
the Selling Stockholder. Certain shares of Common Stock issuable by the Company
upon conversion by the Selling Stockholder of the ValueVision Note and exercise
of the 1995 Warrants and 1998 Warrants were registered for resale pursuant to a
Registration Statement on Form S-3 (Reg. No. 333-48205) declared effective by
the Securities and Exchange Commission on April 16, 1998. The conversion price
of the ValueVision Note is $1.073125 per share of Common Stock. The exercise
price of the 1995 Warrants and the 1998 Warrants is $2.74 per share of Common
Stock.

         Pursuant to Rule 416(a) under the Securities Act of 1933, as amended
(the "Securities Act"), the number of Offered Shares issuable in respect of the
ValueVision Note, the 1995 Warrants and the 1998 Warrants is subject to
adjustment by reason of stock splits, stock dividends and other similar
transactions in the Common Stock.

         None of the proceeds from the sale of the Offered Shares by ValueVision
 will be received by the Company. The Company will pay substantially all of the
 expenses with respect to the offering and sale of the Offered Shares to
the public, including the costs associated with registering the Offered Shares
under the Securities Act and preparing and printing this Prospectus. Any
underwriting commission and broker fees, however, as well as any applicable
transfer taxes, are payable individually by the Selling Stockholder.

         The Company's Common Stock is listed on the New York Stock Exchange
("NYSE") and the Philadelphia Stock Exchange ("PHLX") under the symbol "NM." On
September 21, 1998, the closing sale price for the Common Stock, as quoted on
the New York Stock Exchange ("NYSE"), was $3.4375 per share.


                   SEE "RISK FACTORS" BEGINNING ON PAGE 7 FOR
                CERTAIN INFORMATION THAT SHOULD BE CONSIDERED BY
                             PROSPECTIVE INVESTORS.
                      ------------------------------------

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

               The date of this Prospectus is September __, 1998.

                                        1

<PAGE>

         Pursuant to this Prospectus, the Offered Shares may be sold by the
Selling Stockholder, from time to time while the Registration Statement to which
this Prospectus relates is effective, on the NYSE, the PHLX or otherwise at
prices and terms prevailing at the time of sale, at prices and terms related to
such prevailing prices and terms, in negotiated transactions or at fixed prices.
The Selling Stockholder has advised the Company that it currently intends to
sell all or a portion of the Offered Shares pursuant to this Registration
Statement from time to time in any manner described under "Plan of
Distribution." See "Plan of Distribution." Notwithstanding the registration of
the offer and sale of Offered Shares hereunder to subsequent purchasers, the
Selling Stockholder to whom the Offered Shares were initially issued by the
Company, whether or not an affiliate of the Company, that acquires the
Conversion Shares will be required to deliver this Prospectus in accordance with
the Securities Act in connection with any transaction involving the resale of
such securities.





                                        2

<PAGE>

         NO PERSON HAS BEEN AUTHORIZED TO GIVE ANY INFORMATION OR TO MAKE ANY
REPRESENTATIONS NOT CONTAINED IN THIS PROSPECTUS IN CONNECTION WITH THE OFFERING
MADE BY THIS PROSPECTUS, AND IF GIVEN OR MADE, SUCH INFORMATION OR
REPRESENTATIONS MUST NOT BE RELIED UPON AS HAVING BEEN AUTHORIZED BY THE COMPANY
OR THE SELLING STOCKHOLDER. THIS PROSPECTUS DOES NOT CONSTITUTE AN OFFER TO BUY
THE SECURITIES TO WHICH THIS PROSPECTUS RELATES IN ANY JURISDICTION TO ANY
PERSON TO WHOM IT IS NOT LAWFUL TO MAKE SUCH AN OFFER OR SOLICITATION IN SUCH
JURISDICTION. NEITHER 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 COMPANY SINCE THE DATE HEREOF OR SINCE THE DATE AS
OF WHICH INFORMATION IS SET FORTH HEREIN.


                              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 and other information with the Commission.
Such reports, proxy and information statements and other information can be
inspected and copied at prescribed rates at the Public Reference Section of the
Commission at 450 Fifth Street, N.W., Room 1024, Washington, D.C. 20549, and at
the Commission's regional offices located at 7 World Trade Center, New York, New
York 10048, and Citicorp Center, 500 West Madison Street, Suite 1400, Chicago,
Illinois 60661-2511. Such reports and other information filed with the
Commission can be reviewed through the Commission's Electronic Data Gathering
Analysis and Retrieval System, which is publicly available through the
Commission's website (http:www.sec.gov). The Common Stock of the Company is
listed on the NYSE and the PHLX and reports, proxy and information material and
other information concerning the Company may be inspected at the offices of the
NYSE, 20 Broad Street, New York, New York 10005 and the PHLX, 1900 Market
Street, Philadelphia, Pennsylvania 19103.

         This Prospectus constitutes a part of a registration statement on Form
S-3 (the "Registration Statement") filed by the Company with the Commission
under the Securities Act with respect to the securities offered hereby. This
Prospectus does not contain all the information set forth in the Registration
Statement, certain parts of which are omitted in accordance with the rules and
regulations of the Commission. Reference is hereby made to the Registration
Statement and to the exhibits thereto for further information with respect to
the Company and the securities offered hereby. Copies of the Registration
Statement and the exhibits thereto are on file at the offices of the Commission
and may be obtained upon payment of the prescribed fee or may be examined
without charge at the Public Reference Section of the Commission described
above. Statements contained herein concerning the provisions of documents are
necessarily summaries of such documents, and each statement is qualified in its
entirety by reference to the copy of the applicable document filed with the
Commission.


                 INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE

         The following documents filed by the Company with the Commission are
incorporated herein by reference:

         (a)      The Company's Annual Report on Form 10-K for the fiscal year
                  ended March 31, 1998 (the "Form 10-K");

         (b)      Amendment No. 1 on Form 10-K/A;

         (c)      The Company's Quarterly Report on Form 10-Q for the quarter
                  ended June 30, 1998;

         (d)      The Company's Current Reports on Form 8-K, dated April 8,
                  1998, June 1, 1998 , July 15, 1998 and August 13, 1998;

         (e)      The Company's proxy statement on Schedule 14A, dated September
                  23, 1998; and

         (f)      The description of the Company's Common Stock contained in the
                  Company's Registration Statement on Form 8-A, dated August 28,
                  1990, including all amendments and reports filed for the
                  purpose of updating such description.


         All documents filed 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
completion or termination of this offering shall be deemed to be incorporated by

                                        3

<PAGE>

reference in this Prospectus and to be part hereof from the date of filing of
such documents. Any statement contained in a document, all or a portion of which
is 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 also is or is deemed to be incorporated by reference herein,
modifies or supersedes such statement. Any statement so modified or superseded
shall not be deemed, except as so modified or superseded, to constitute a part
of this Prospectus.

         The Company will provide without charge to each person, including any
beneficial owner, to whom this Prospectus is delivered, upon written or oral
request, a copy of any or all of such documents which are incorporated herein by
reference (other than exhibits to such documents unless such exhibits are
specifically incorporated by reference into the documents that this Prospectus
incorporates). Written or oral requests for copies should be directed to
National Media Corporation, c/o Quantum Television, 15821 Ventura Boulevard,
Suite 570, Encino, California 91416; Attention: Director of Investor Relations,
phone number 818-461-6400.


                                        4

<PAGE>

                           FORWARD-LOOKING STATEMENTS

         This Prospectus contains "forward-looking" statements regarding
potential future events and developments affecting the business of the Company.
Such statements relate to, among other things, (i) the transactions described
under "Recent Developments" below; (ii) competition for customers for the
Company's products and services; (iii) the uncertainty of developing or
obtaining rights to new products that will be accepted by the market and the
timing of the introduction of new products into the market; (iv) the limited
market life of the Company's products; and (v) other statements about the
Company or the direct response consumer marketing industry.

         The Company's ability to predict the results or the effect of any
pending events on the Company's operating results is inherently subject to
various risks and uncertainties, including competition for products, customers
and media access; the risks of doing business abroad; the uncertainty of
developing or obtaining rights to new products that will be accepted by the
market; the limited market life of the Company's products; and the effects of
government regulations. Reference is made in particular to the discussion under
"Management's Discussion and Analysis of Financial Condition and Results of
Operations" in the Company's 1998 Annual Report and Quarterly Report on Form
10-Q incorporated in this Prospectus by reference. Such forward-looking
statements include those preceded by, followed by or that include the words
"believes," "expects," "anticipates," "intends,""plans," "estimates" or similar
expressions.


                                   THE COMPANY

         The Company is principally engaged in the use of direct response
transactional television programming, known as infomercials, to sell consumer
products. The Company manages all phases of direct marketing for the majority of
its products in both the United States and international markets, including
product selection and development, manufacturing by third parties, production
and broadcast of infomercials, order processing and fulfillment and customer
service.

         The Company is engaged in direct marketing of consumer products in the
United States and Canada through its wholly-owned subsidiary, Quantum North
America, Inc. (formerly Media Arts International, Ltd.), which the Company
acquired in 1986, and internationally through its wholly-owned subsidiaries:
Quantum International Limited, which the Company acquired in 1991; Quantum Far
East Ltd., through which the Company operates in all Asian countries other than
Japan; Quantum International Japan Company Limited, which the Company formed in
June 1995; and Prestige Marketing Limited ("Prestige") and Suzanne Paul Holdings
Pty Limited and its operating subsidiaries (collectively, "Suzanne Paul"), which
the Company acquired in July 1996. The Company produces infomercials through
Quantum Television (formerly d/b/a DirectAmerica Corporation), which the Company
acquired in October 1995.

         The Company is a Delaware corporation, with its principal executive
offices located at 15821 Ventura Boulevard, Suite 570, Encino, California 91416
and its telephone number is 818-461-6400.


                               RECENT DEVELOPMENTS

         On August 11, 1998, the Company executed definitive agreements with NM
Acquisition Co., LLC ("ACO"), a new Delaware limited liability company formed
for the purpose of the Transactions described herein, relating to a transaction
pursuant to which an investor group (the "Investor Group") has agreed to acquire
a substantial equity interest in and operational control of the Company through
the purchase from the holders thereof (the "Series D Holders") of $10,000,000 of
the Company's Series D Convertible Preferred Stock, par value of $.01 per share
(the "Series D Preferred Stock"), and the purchase from the Company of
$20,000,000 to $22,000,000 of the Company's newly-created Series E Convertible
Preferred Stock, par value $.01 per share (the "Series E Preferred Stock")
(together with the other transactions contemplated thereby, the "Transactions").

         At the time of the execution of the definitive agreements regarding the
Transactions, the Investor Group consummated the acquisition of 10,000 shares of
the Company's outstanding Series D Preferred Stock, along with warrants to
purchase 992,942 shares of Common Stock which had previously been issued to the
original holders of the Series D Preferred Stock (collectively, the "Series D
Securities") from the Series D Holders for an aggregate of $10,000,000. Upon
consummation of such acquisition, the Investor Group, the Series D Holders and
the Company eliminated the floating conversion price feature of the Series D
Preferred Stock, fixing the conversion price at $1.073125 per share of Common
Stock and agreed to certain limitations regarding sales of the Series D
Securities and the Common Stock issuable upon conversion and/or exercise of the
Series D Securities. In the event the Transactions are not consummated, or upon
the occurrence of certain events, including a subsequent "change in control" of
the Company, the agreements related to the elimination of the floating
conversion price feature of the Series D Preferred Stock, the

                                        5

<PAGE>

sales limitations with respect to the Series D Securities and the Common Stock
issuable upon conversion and/or exercise of the Series D Securities and certain
other covenants with respect to sales of the Series D Securities and the Common
Stock issuable upon conversion and/or exercise of the Series D Securities will
terminate.

         In addition to the $10,000,000 acquisition of the Series D Securities,
ACO entered into a stock purchase agreement with the Company pursuant to which
the Investor Group agreed to invest a minimum of $20,000,000 and a maximum of
$22,000,000 directly into the Company in exchange for shares of the Company's
newly-created Series E Preferred Stock. The Series E Preferred Stock will be
convertible into shares of Common Stock at a fixed conversion price of $1.50 per
share (subject to adjustment for certain anti-dilution events).

         Upon execution of the definitive agreements regarding the Transactions,
Stephen C. Lehman was named Acting Chief Executive Officer of the Company. Mr.
Lehman, Eric R. Weiss and Andrew M. Schuon were also named to the Company's
Board of Directors as designees of ACO. The Company also entered into a
consulting agreement (the "Consulting Agreement") with Temporary Media Co., LLC,
a newly-formed limited liability company controlled by Mr. Lehman, Mr. Weiss and
Daniel M. Yukelson ("TMC"), pursuant to which TMC is presently providing
executive management consulting services to the Company pending consummation of
the Transactions. In connection with the Consulting Agreement, the Company
granted to TMC (i) a five-year option (the "TMC Options") to purchase up to
212,500 shares of Common Stock, subject to certain vesting requirements, at an
exercise price of $1.32 per share and (ii) contingent warrants (the "TMC
Warrants"), which will only become effective following consummation of the
Transactions, to purchase up to 3,762,500 shares of Common Stock, at exercise
prices ranging from $1.32 per share to $3.00 per share. In the event that the
Company's stockholders do not approve the Transactions, all TMC Warrants and all
non-vested TMC Options will be cancelled. Additionally, if TMC materially
breaches its duties and obligations under the Consulting Agreement and such
breach remains uncured for 30 days, all TMC Warrants and all non-vested TMC
Options will be cancelled. 1,000,000 of the TMC Warrants shall not be exercised
by TMC or any employee of TMC and may only be transferred to any officer,
director, employee or consultant of the Company other than Messrs. Lehman,
Weiss, Yukelson or any employee of TMC. TMC expects to use the TMC Warrants to
retain and attract highly qualified executive personnel and other persons
associated with the Company's programming to the Company and that the TMC
Warrants will have additional terms which provide for the vesting of the TMC
Warrants over a three to five year period.

         As a result of negotiations initiated by the Company and ACO, the
Company also executed agreements with First Union National Bank ("First Union")
and ValueVision providing for modifications to the Company's two primary credit
facilities. First Union waived all outstanding financial covenant violations and
modified certain financial covenants pending consummation of the Transactions
upon receipt of a $190,000 fee. First Union also agreed to accept payment of 75%
of all outstanding principal obligations in full satisfaction of the Company's
indebtedness, provided such payment is made to First Union by November 15, 1998
and all other outstanding fees and accrued interest are paid in full.

         ValueVision has agreed to waive its right to accelerate repayment of
its $10,000,000 demand note (the "ValueVision Note") pending Closing of the
Transactions, other than in the event of an acceleration of the First Union
facility. ValueVision also agreed to certain standstill provisions and certain
limitations regarding the Company's payment of the ValueVision Note prior to
January 1, 1999. In consideration thereof, the Company agreed to re-price
certain warrants held by ValueVision to $2.74 per share. The Company retained
its right to repay the ValueVision Note upon maturity in cash or shares of
Common Stock (at $1.073125 per share) at the Company's option.

         The Company has filed with the Securities and Exchange Commission, the
New York Stock Exchange and the Philadelphia Stock Exchange a definitive proxy
statement describing the Transactions.

                                        6

<PAGE>

                                  RISK FACTORS

         The purchase of the shares of Common Stock offered hereby involve
certain risks. In addition to the other information set forth and incorporated
by reference in this Prospectus, the following factors should be considered
carefully by prospective investors in evaluating an investment in the shares of
Common Stock offered hereby. The Company's fiscal year ends on March 31.
References to fiscal 1998, fiscal 1997 etc. refer to the fiscal period ending in
the indicated calendar year.

Recent Losses; Cash Flow

         The Company has suffered net losses in four of its last five fiscal
years, including net losses of approximately $56.8 million in fiscal 1998,
approximately $45.7 million in fiscal 1997, approximately $670,000 in fiscal
1995 and approximately $8.7 million in fiscal 1994. The Company also reported a
net loss of approximately $3.2 million for the first quarter of fiscal 1999.
Based upon the deterioration which occurred in the Company's financial condition
during fiscal 1997 and 1998 and the presence of certain other conditions, as of
June 29, 1998, the Company's independent auditors opined that substantial doubt
existed as to the Company's ability to continue as a going concern. During
calendar year 1998, the Company has also experienced, as result of such losses
and other circumstances, significant cash flow difficulties. While the Company
has developed a business plan and implemented a number of programs designed to
reduce costs and return the Company to profitability, there can be no assurance
that the Company's business plan adequately addresses the circumstances and
situations which resulted in the Company's performance in the periods referred
to above. Unless the Company has adequately addressed the reasons for its recent
results of operations, there can be no assurance as to the Company's future
results of operations.

Nature of the Infomercial Industry

         The worldwide infomercial industry is now characterized by extreme
competition for products, customers and media access. The Company's future in
this industry will depend in part on its access to, and efficient management of,
media time; the introduction of successful products and the full exploitation of
such products through not only direct marketing but also traditional retail
marketing and other channels of distribution, including the Internet; its
ability to enhance its product lines and support product marketing and sales
with efficient order fulfillment and customer services; and its ability to
successfully integrate the entities or businesses the Company has or may acquire
into an efficient global company. The future revenues of the business will
depend substantially on the Company's ability to create and maintain an
effective, integrated organization to develop, introduce and market products
that (i) address changing consumer needs on a timely basis; (ii) establish and
maintain effective distribution channels (infomercial and non-infomercial) for
its products; and (iii) develop new geographic markets while expanding
profitable established geographic markets. There can be no assurance that the
Company will be able to achieve these goals. While the Company maintains an
internal product development group responsible for seeking out new products from
third parties, there can be no assurance that present and potential third party
product providers will choose to market products through the Company in the
future. Delays in product introductions and short falls in successful product
introductions played a significant part in the Company's fiscal 1997, 1998 and
subsequent results of operations. Any significant delays or reductions in
product introductions in the future periods could have a material adverse effect
on the Company's future results of operations.

Dependence on Foreign Sales

         The Company had no sales outside the United States and Canada prior to
June 1991. The Company now markets products to consumers in over 70 countries.
In fiscal 1998, 1997 and 1996, approximately 54.9%, 47.4% and 51.6%,
respectively, of the Company's net revenues were derived from sales to customers
outside the United States and Canada. In fiscal 1998, 1997 and 1996, sales in
Germany accounted for approximately 7.5%, 5.7% and 7.0%, respectively, of the
Company's net revenues. In early 1994, the Company began airing its infomercials
in Asia. Sales of the Company's products in Asia accounted for approximately
15.2% of' the Company's net revenues for fiscal 1998, down from 19.8% in fiscal
1997. Sales of the Company's products in Japan, which represented a significant
portion of Asian revenues, accounted for approximately 11.5% of the Company's
net revenues in fiscal 1998, down from 17.7% in fiscal 1997. The economic
downturn in these markets has materially adversely affected the Company. A
turnaround is not yet expected. Geographical expansion of sales activity has
resulted in increased working capital requirements as a result of additional
lead time for delivery of and payment for product prior to receipt of sale
proceeds. While the Company's foreign operations have the advantage of airing
infomercials that have already proven successful in the United States market, as
well as successful infomercials produced by domestic and other international
companies with limited media access and distribution capabilities, there can be
no assurance that the Company's foreign operations will continue to generate
similar levels of net revenues. Competition in the Company's international
marketplace is increasing rapidly. In addition, the Company is subject to many
risks associated with doing business abroad, including: adverse fluctuations in
currency exchange rates; transportation delays and interruptions; political and
economic

                                        7

<PAGE>

disruptions; the imposition of tariffs and import and export controls; and
increased customs or local regulations. The occurrence of any one or more of the
foregoing could have a material adverse effect on the Company's results of
operations.

Entering into New Markets

         As the Company enters into new markets, including countries in Asia and
South America, it is faced with the uncertainty of never having done business in
those commercial, political and social settings. Accordingly, despite the
Company's best efforts, its likelihood of' success in each new market which it
enters is unpredictable for reasons particular to each such market. It is also
possible that, despite the Company's apparently successful entrance into a new
market, some unforeseen circumstance could arise which would limit the Company's
ability to continue to do business or to expand in that new market.

Dependence on New Products; Unpredictable Market Life; Inventory Management and
Product Returns

         The Company is dependent on its continuing ability to develop or obtain
rights to new products to supplement or replace existing products as they mature
through their product life cycles. The Company's future results of operations
will also be dependent upon its ability to proactively manage its products
through their life cycles. The Company's five most successful products in each
of fiscal 1998, 1997 and 1996 accounted for approximately 40.3%, 41.2% and
46.0%, respectively, of the Company's net revenues for such periods. For the
most part, the Company's five most successful products change from year to year.
Revenues are dependent from year to year on the introduction of new products.
Even if the Company is able to introduce new products, there can be no assurance
that such new products will be successful. The Company's future results of
operations depend on its ability to spread its revenue (sales) stream over a
larger number of products in a given period and to more effectively exploit the
full revenue potential of each product it introduces through all levels of
consumer marketing, whether directly or through third parties.

         Product sales and results of operations for a given period will depend
upon, among other things, a positive customer response to the Company's
infomercials, the Company's effective management of product inventory and the
stage in their life cycles of products sold during such period. Customer
response to infomercials depends on many variables, including, the appeal of the
products being marketed, the effectiveness of the infomercials, the availability
of competing products and the timing and frequency of air-time. There can be no
assurance that the Company's new products will receive market acceptance.

         In the event the Company does not have an adequate supply of inventory,
as a result of production delays or shortages or inadequate inventory management
or cash flow difficulties, it may lose potential product sales. The ability of
the Company to maintain systems and procedures to more effectively manage its
inventory (and its infomercial airings), in the domestic as well as
international markets, is of critical importance to the Company's continuing
cash flow and results of operations. It is possible that, during a product's
life, unanticipated obsolescence of such product may occur or problems may arise
regarding regulatory, intellectual property, product liability or other issues
which may affect the continued viability of the product for sale despite the
fact that the Company may still hold a sizable inventory position in such
product. Most of the Company's products have a limited market life. Accordingly,
it is extremely important that the Company fully realize the potential of each
successful product.

         Historically, the majority of products generate their most significant
domestic revenue in their introductory year. Foreign revenues have tended to be
generated more evenly over a somewhat longer period. In the event the number of
times an infomercial is broadcast within a market is increased, the market life
of such product in such market may decrease. There can be no assurance that a
product which has produced significant sales will continue to produce
significant, or any, sales in the future. As a result, the Company is dependent
on its ability to adapt to market conditions and competition as well as other
factors which affect the life cycles of its products and its ability to continue
to identify and successfully market new products. The failure of newly
introduced products or significant delays in the introduction of, or failure to
introduce, new products would adversely impact the Company's results of
operations in terms of both lost opportunity cost and actual loss of dollars
invested.

         Even when market acceptance for the Company's new products occurs, the
Company's results of operations may be adversely impacted by returns of' such
products, either pursuant to the Company's warranties or otherwise. While the
Company establishes reserves against such returns which it believes are adequate
based upon historic levels and product mix, there can be no assurance that the
Company will not experience unexpectedly high levels of returns (in excess of'
its reserves) for certain products. In the event that returns exceed reserves,
the Company's results of operations would be adversely affected.


                                        8

<PAGE>

Dependence on Third Party Manufacturers and Service Providers

         The Company has historically been dependent on third party sources,
both foreign and domestic, to manufacture all of its products. From time to
time, the Company has also been dependent to an extent upon a number of
companies which serve to fulfill orders placed for the Company's products and/or
provide telemarketing services. The inability of the Company, either temporarily
or permanently, to obtain a timely supply of product to fulfill sales orders for
a specific product or to satisfy orders for such product could have a material
adverse effect on the Company's results of operations. Moreover, because the
time from this initial approval of a product by the Company's product
development personnel to the first sale of such product is relatively short, the
Company's ability to cause its manufacturing sources to meet its production and
order fulfillment deadlines at reasonable costs and produce a high-quality
product or render quality service is important to its business. There can be no
assurance that the Company will successfully manage this process in such a way
to maximize its sales of its products. Since the Company often relies on foreign
manufacturers, it must allow longer lead times for products to fulfill customer
orders. Utilizing such foreign manufacturers exposes the Company to the general
risks of doing business abroad.

Dependence on Media Access; Effective Management of Media Time

         The Company has historically been dependent on having access to media
time to televise its infomercials on cable networks, network affiliates and
local stations. The Company's future results of operation will also depend upon
the Company's ability to manage its media time, taking advantage of long-term
purchases where prudent and spot purchases where necessary. This media
management function must also include a meaningful coordination between
available infomercials and available media time. In the normal course of
business, the Company's media contracts expire pursuant to their terms from time
to time. There can be no assurance that, as existing contracts expire, the
Company will be able to purchase or renew media time on a long-term basis or at
favorable price levels. The Company purchases a significant amount of its media
time from cable television and satellite networks. These cable television and
satellite networks assemble programming for transmission to multiple and local
cable system operators. These cable system operators may not be required to
carry all of the network's programming. The Company currently does not pay and
is not paid for the "privilege" of being broadcast by these operators. It is
possible that, if demand for air time grows, these operators will begin to
charge the Company to continue broadcasting the Company's infomercials or limit
the amount of time available for broadcast. Recently, larger multiple system
operators have elected to change their operations by selling "dark" time (i.e.,
the hours during which a station does not broadcast its own programming).
Significant increases in the cost of' media time or significant decreases in the
Company's access to media time, domestically or internationally, including, but
not limited to, any failure to renew or extend existing agreements, could have a
material adverse effect on its results of operations. There can also be no
assurances that, even if the Company secures media access, its programming will
attract viewers or that its products will enjoy consumer acceptance. In
addition, periodically, due to world events, media access and the number of
persons viewing the Company's infomercials in one or more markets may be
substantially diminished. In such circumstances, the Company's results of
operations for such periods may be adversely affected. In recent periods the
Company has experienced an increase in the demand by international media
suppliers for fixed rates and/or for minimum revenue guarantees, both of which
increase the Company's risk.

         Whenever the Company makes advance purchases and commitments to
purchase media time, if the Company does not manage such media time effectively,
such failure could have a material adverse effect on the Company's results of
operations. In the event the Company is unable to utilize all of the media time
it has acquired, it attempts to arrange to sell a portion of its media time to
others. There can be no assurance, however, that the Company will be able to use
all of its media time or sell it to others or that, upon expiration of such
long-term contracts, the Company will be able to successfully negotiate
extensions of such contracts on terms favorable to the Company. The Company's
existing agreement with Mitsui & Co., Ltd. ("Mitsui") regarding its operations
in Japan will terminate on January 1, 1999. The Company and Mitsui are involved
in negotiations to restructure their relationships in Japan and Asia in order to
address changes in that market and other circumstances which have arisen. The
inability of the Company to extend one or more of such contracts on reasonable
terms as they expire could have a material adverse effect on the Company's
results of operations. In April 1998 the Company began leasing a twenty-four
hour transponder on a newly-launched Eutelstat satellite, the "Hotbird IV," the
coverage of which reaches across the European continent. The Company expects to
incur significant start up costs in connection with the transponder lease. There
can be no assurance that the Company will be able to effectively utilize such
media time. Failure to do so could have a material adverse effect on the Company
and its results of operations.

Litigation Involving the Company

         The infomercial industry has historically been very litigious and the
Company in recent years has been involved in significant legal proceedings and
has incurred significant charges in prior periods related to such litigation.

                                        9

<PAGE>

Abbreviated information regarding the status of current material pending
litigation involving the Company is set forth below. However, as it pertains to
previously reported matters, such information does not purport to be complete
and is qualified in its entirety by the detailed description of the legal and
regulatory proceedings set forth in the reports filed by the Company pursuant to
the Exchange Act and incorporated by reference herein. Such descriptions
variously include information relating to the status of the proceedings and the
Company's evaluation of the claims made against it. Certain of such previously
reported matters have been resolved substantially in accordance with the terms
set forth in such prior disclosure. In addition, the Company consummated the
acquisition of DirectAmerica in October 1995 and the acquisition of Positive
Response Television, Inc. ("Positive Response") in May 1996. As a result of
these acquisitions, all liabilities of DirectAmerica and Positive Response
became liabilities of the respective wholly-owned subsidiary of the Company into
which each of DirectAmerica and Positive Response was merged. The Company also
acquired Prestige and Suzanne Paul in July 1996, including all of their
respective liabilities.

WWOR Litigation

         In March 1997, WWOR-TV filed a breach of contract action in the United
States District Court for New Jersey against one of the Company's operating
subsidiaries alleging that the subsidiary wrongfully terminated a contract for
the purchase of media time, seeking in excess of $1,000,000 in compensatory
damages. The Company is contesting the action. At this stage, the Company cannot
predict the outcome of this matter; however, even if plaintiffs were to succeed
on all of their claims, the Company does not believe that such result would have
a material adverse impact on the Company's results of operations.

Regulatory Matters

         As a result of prior settlements with the FTC, the Company has agreed
to two consent orders. Prior to the Company's acquisition of Positive Response,
Positive Response and its Chief Executive Officer, Michael S. Levey, also agreed
to a consent order with the FTC. Among other things, such consent orders require
Positive Response and Mr. Levey to submit compliance reports to the FTC staff.
The Company and Mr. Levey submitted compliance reports as well as additional
information requested by the FTC staff. In June 1996, the Company received a
request from the FTC for additional information regarding certain of the
Company's infomercials in order to determine whether the Company was operating
in compliance with the consent orders referred to above. The FTC later advised
the Company that it believed the Company had violated one of the consent orders
by allegedly failing to substantiate certain claims made in one of its
infomercials which it no longer airs in the United States. The Company has
provided information to the FTC to demonstrate substantiation. If the Company's
substantiation is deemed to be insufficient by the FTC, the FTC has a variety of
enforcement mechanisms available to it, including, but not limited to, monetary
penalties. While no assurances can be given, the Company does not believe that
any remedies to which it may become subject will have a material adverse effect
on the Company's results of operations or financial condition. The FTC recently
notified the Company that it had concerns about claims being made in one of the
Company's current infomercials and also raised questions concerning certain
aspects of the Company's pricing practices in certain of its current
infomercials. The Company is responding to the FTC's inquiries.

         In addition, in Spring 1997, in accordance with applicable regulations,
the Company notified the CPSC of breakages which were occurring in its Fitness
Strider product. The Company also notified the CPSC of its replacement of
certain parts of the product with upgraded components. The CPSC reviewed the
Company's testing results in order to assess the adequacy of the Company's
upgraded components. The CPSC also undertook its own testing of the product and,
in November 1997, informed the Company that the CPSC compliance staff had made a
preliminary determination that the Fitness Strider product and upgraded
component present a substantial product hazard, as defined under applicable law.
The Company and the CPSC staff are discussing voluntary action to address the
CPSC's concerns, including replacement of the affected components. At present,
management of the Company does not anticipate that any action agreed upon, or
action required by the CPSC, will have any material adverse impact on the
Company's financial condition or results of operations. The Company has also
been contacted by Australian consumer protection regulatory authorities
regarding the safety and fitness of the Fitness Strider product and an exercise
rider product marketed only in Australia and New Zealand. At this point, the
Company cannot predict whether the outcome of these matters regarding the
Fitness Strider will have a material adverse impact upon the Company's financial
condition or results of operations.

         In August 1998, the Company received notice from the NYSE that the
Company did not meet the NYSE's standards for continued listing. The NYSE also
requested that the Company provide information regarding any actions taken or
proposed by the Company to restore the Company to compliance with the NYSE
standards. The Company is formulating its response to the NYSE notification and
request. The delisting of the Company's Common Stock from trading on the NYSE
would have a material adverse effect on the Company.


                                       10

<PAGE>

Product Liability Claims

         Products sold by the Company may expose it to potential liability from
claims by users of such products, subject to the Company's rights, in certain
instances, to indemnification against such liability from the manufacturers of
such products. The Company generally requires the manufacturers of its products
to carry product liability insurance, although in certain instances where a
limited quantity of products are purchased from non-U.S. vendors, the vendor may
not be formally required to carry product liability insurance. Certain of such
vendors, however, maintain such insurance. There can be no assurance that such
parties will maintain this insurance or that this coverage will be adequate to
cover all potential claims, including coverage in amounts which it believes to
be adequate. There can be no assurance that the Company will be able to maintain
such coverage or obtain additional coverage on acceptable terms, or that such
insurance will provide adequate coverage against all potential claims.

Competition

         The Company competes directly with many companies which generate sales
from infomercials. The Company also competes with a large number of consumer
product companies and retailers which have substantially greater financial,
marketing and other resources than the Company, some of which have recently
commenced, or indicated their intent to conduct, direct response marketing. The
Company also competes with companies that make imitations of the Company's
products at substantially lower prices. Products similar to the Company's
products may be sold in department stores, pharmacies, general merchandise
stores and through magazines, newspapers, direct mail advertising and catalogs.

Dependence on Key Personnel

         The Company's executive officers have substantial experience and
expertise and make significant contributions to the Company's growth and
success. In particular, the Company is highly dependent on certain of its
employees responsible for product development and production of infomercials.
The unexpected loss of the services of one or more of such individuals could
have a material adverse effect on the Company. The employment agreement of John
W. Kirby, the Company's President, expires in September 1998. There is no
assurance that the Company will be able to reach a new agreement with Mr. Kirby.

Year 2000 Issues

         The efficient operation of the Company's business is dependent in part
on its computer hardware, software programs and operating systems (collectively,
"Programs and Systems"). These Programs and Systems are used in several key
areas of the Company's business, including merchandise purchasing, inventory
management, pricing, sales, shopping and financial reporting, as well as in
various administrative functions. The Company has been evaluating its Programs
and Systems to identify potential Year 2000 compliance issues. These actions are
necessary to ensure that the Programs and Systems will recognize and process the
Year 2000 and beyond. It is anticipated that modification or replacement of some
of the Company's Programs and Systems will be necessary to make such Programs
and Systems Year 2000 compliant. The Company is also communicating with
suppliers, financial institutions and others to coordinate Year 2000 conversion.

         Based on present information, the Company believes that it will be able
to achieve such Year 2000 compliance through a combination of modification of
some existing Programs and Systems, and the replacement of other Programs and
Systems with new Programs and Systems that are already Year 2000 compliant.
However, no assurance can be given that these efforts will be successful. The
Company does not expect that the expenses and capital expenditures associated
with achieving Year 2000 compliance will have a material effect on its financial
condition or results of operations.

Convertible Securities; Shares Eligible for Future Sale

         Sales of substantial amounts of the shares of Common Stock currently
issued, issuable upon conversion or exercise of securities convertible into or
exercisable for Common Stock or of the shares of Common Stock offered hereby
could adversely affect the market value of the Common Stock, depending upon the
timing of such sales, and, in the case of convertible and exercisable
securities, may effect a dilution of the book value per share of Common Stock.

         As of September 25, 1998, there were 25,466,937 shares of Common Stock
outstanding, nearly all of which were freely tradeable without restriction under
the Securities Act unless held by affiliates. In addition, as of September 25,
1998, approximately 44,000,000 shares of Common Stock were reserved for issuance
upon exercise of outstanding warrants (including the TMC Warrants), options
(including the TMC Options), the Company's Series B

                                       11

<PAGE>

Convertible Preferred Stock and the Company's Series D Convertible Preferred
Stock. In the event that the Transactions are consummated, the Company will be
required to reserve for issuance an additional 13,333,333 shares of Common Stock
for issuance upon conversion of the Series E Preferred Stock (assuming the
purchase by ACO of $20,000,000 of Series E Preferred Stock) and the Company will
be obligated to file and have declared effective a registration statement
registering for resale by ACO (or its designee) the shares of Common Stock
issuable upon conversion and/or exercise of the Series E Preferred Stock, the
TMC Warrants and the TMC Options.


                                 USE OF PROCEEDS

         The Company will not receive any proceeds from the sale of the
Conversion Shares offered hereby. The Selling Stockholders will receive all of
the net proceeds from the sale of the Conversion Shares offered hereby.

                                       12

<PAGE>

                               SELLING STOCKHOLDER

         The following table sets forth the name of the Selling Stockholder, the
number of shares of Common Stock beneficially owned by the Selling Stockholder
as of September 25, 1998 and the number of Offered Shares which may be offered
for sale pursuant to this Prospectus by such Selling Stockholder. During the
past three years, the Selling Stockholder and the Company have engaged in
certain business transactions, including a merger agreement which was terminated
prior to consummation in June 1998. See the Company's Annual Report on Form 10-K
for the fiscal year ended March 31, 1998. The Offered Shares may be offered from
time to time by the Selling Stockholder named below. See "Plan of Distribution."
However, the Selling Stockholder is under no obligation to sell all or any
portion of the Offered Shares, nor is the Selling Stockholder obligated to sell
any such Offered Shares immediately under this Prospectus. Because the Selling
Stockholder may sell all or part of the Offered Shares, no estimate can be given
as to the number of shares of Common Stock that will be held by the Selling
Stockholder upon termination of any offering made hereby.

         Pursuant to Rule 416(a) under the Securities Act, the shares of Common
Stock issuable in respect of the ValueVision Note are subject to adjustment by
reason of stock splits, stock dividends, and other similar transactions in the
Common Stock.

<TABLE>
<CAPTION>

                                                                                        Common Shares Beneficially
                                                                                         Owned After Offering (1)
                                          Number of Common
                                        Shares Beneficially         Common Shares                       Percent of
Name of Selling Stockholder           Owned Prior to Offering      Offered Hereby         Number       Outstanding
- ---------------------------------------------------------------------------------------------------------------------
<S>                                          <C>                     <C>                   <C>               
ValueVision International, Inc.              750,000(2)              10,068,579            0(2)             -
</TABLE>

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

(1)      Assumes the sale of all Offered Shares.

(2)      In accordance with Section 13(d) of the Securities Exchange Act of
         1934, as amended, and the terms of the ValueVision Note, does not
         include shares of Common Stock which may be issued upon conversion of
         the ValueVision Note, including 5,000,000 shares of Common Stock that
         were previously registered for resale on a Registration Statement on
         Form S-3 (Reg. No. 333-48205) declared effective by the Commission on
         April 16, 1998, and 4,318,570 shares of Common Stock being registered
         for resale pursuant hereto. The 9,318,570 shares of Common Stock
         issuable upon conversion of the ValueVision Note represents the number
         of shares issuable upon conversion of $10,000,000 in principal due to
         ValueVision pursuant to the terms of the ValueVision Note at a
         conversion price of $1.073125 per share of Common Stock. The exercise
         price of the 1995 Warrants and 1998 Warrants is $2.74 per share of
         Common Stock.





                                       13

<PAGE>

                              PLAN OF DISTRIBUTION

         The Offered Shares are being offered on behalf of the Selling
Stockholder and the Company will not receive any proceeds from the Offering. The
Offered Shares may be sold or distributed from time to time by the Selling
Stockholder, or by pledgees, donees or transferees of, or other successors in
interest to, the Selling Stockholder, directly to one or more purchasers
(including pledgees) or through brokers, dealers or underwriters who may act
solely as agent or may acquire Offered Shares as principals, at market prices
prevailing at the time of sale, at prices related to such prevailing market
prices, at negotiated prices, or at fixed prices, which may be changed. The sale
of the Offered Shares may be effected in one or more of the following methods:
(i) ordinary brokers' transactions, which may include long or short sales; (ii)
transactions involving cross or block trades or otherwise on the NYSE and PHLX;
(iii) purchases by brokers, dealers or underwriters as principal and resale by
such purchasers for their own accounts pursuant to this Prospectus; (iv) "at the
market" to or through market makers or into established trading markets,
including direct sales to purchasers or sales effected through agents; (vi) any
combination of the foregoing, or by any other legally available means. In
addition, the Selling Stockholder or its successor in interest may enter into
hedging transactions with broker-dealers who may engage in short sales of
Offered Shares in the course of hedging the position they assume with the
Selling Stockholder. The Selling Stockholder or its successor in interest may
also enter into option or other transactions with broker-dealers that require
the delivery by such broker-dealers of the Offered Shares, which Offered Shares
may be resold thereafter pursuant to this Prospectus. There can be no assurance
that all or any of the Offered Shares will be issued to, or sold by, the Selling
Stockholder.

         Brokers, dealers, underwriters or agents participating in the sale of
the Offered Shares as agents may receive compensation in the form of
commissions, discounts or concessions from the Selling Stockholder and/or
purchasers of the Offered Shares for whom such broker-dealers may act as agent,
or to whom they may sell as principal, or both (which compensation to a
particular broker-dealer may be less than or in excess of customary
commissions). The Selling Stockholder and any broker-dealers or other persons
who act in connection with the sale of Offered Shares hereunder may be deemed to
be "Underwriters" within the meaning of the Securities Act, and any commission
they receive and proceeds of any sale of Offered Shares may be deemed to be
underwriting discounts and commissions under the Securities Act. Neither the
Company nor the Selling Stockholder can presently estimate the amount of such
compensation. The Company knows of no existing arrangements between the Selling
Stockholders any other shareholders, broker, dealer, underwriter or agent
relating to the sale or distribution of the Offered Shares.

         The Selling Stockholder and any other persons participating in the sale
or distribution of the Shares will be subject to applicable provisions of the
Exchange Act and the rules and regulations thereunder, which provisions may
limit the timing of purchases and sales of any of the Offered Shares by the
Selling Stockholder or any other such persons. The foregoing may affect the
marketability of the Offered Shares.

         The Company will pay substantially all of the expenses incident to the
registration, offering and sale of the Offered Shares to the public other than
commissions or discounts of underwriters, broker-dealers or agents. The Company
has also agreed to indemnify the Selling Stockholder and certain related persons
against certain liabilities, including liabilities under the Securities Act.


                                  LEGAL MATTERS

         The validity of the Offered Shares has been passed upon for the Company
by Brian J. Sisko, Esq., Senior Vice President and General Counsel of the
Company.


                                     EXPERTS

         The consolidated financial statements and schedule of National Media
Corporation appearing in the Company's Annual Report (Form 10-K) for the year
ended March 31, 1998 have been audited by Ernst & Young LLP, independent
auditors, as set forth in their report thereon (which contains an explanatory
paragraph indicating that matters exist that raise substantial doubt as to the
Company's ability to continue as a going concern) included therein and
incorporated herein by reference. Such consolidated financial statements and
schedule have been incorporated herein by reference in reliance upon such report
given upon the authority of such firm as experts in accounting and auditing.

                                       14

<PAGE>

No dealer, salesman or any other person has been authorized to give any
information or to make any representations not contained in this Prospectus in
connection with the offering described herein and, if given or made, such
information or representation must not be relied upon as having been authorized
by the Company or the Selling Stockholder. This Prospectus does not constitute
an offer to sell or a solicitation of an offer to buy a security other than the
shares of Common Stock offered hereby, nor does it constitute an offer to sell
or a solicitation of an offer to buy any of the securities offered hereby in any
jurisdiction to any person to whom it is unlawful to make such offer or
solicitation in such jurisdiction. Neither the delivery of this Prospectus nor
any sale made hereunder shall, under any circumstances, create any implication
that the information contained herein is correct as of any date subsequent to
the date hereof.


                                TABLE OF CONTENTS


<TABLE>
<CAPTION>

                                                                                                               Page

<S>                                                                                                             <C>
Available Information...........................................................................................  3
Incorporation of Certain
Documents by Reference..........................................................................................  3
Forward-Looking Statements......................................................................................  5
The Company.....................................................................................................  5
Recent Developments.............................................................................................  5
Risk Factors..................................................................................................... 7
Use of Proceeds..................................................................................................12
Selling Stockholder..............................................................................................13
Plan of Distribution.............................................................................................14
Legal Matters....................................................................................................14
Experts..........................................................................................................14
</TABLE>


                        10,068,579 Shares of Common Stock


                           NATIONAL MEDIA CORPORATION



                                   PROSPECTUS




                               September __, 1998









<PAGE>

                                     PART II

               INFORMATION REQUIRED IN THE REGISTRATION STATEMENT

Item 14. Other Expenses of Issuance and Distribution.

         The following is an itemized statement of the estimated amounts of all
expenses payable by the Registrant in connection with the registration of the
Offered Shares, other than underwriting discounts and commissions:
<TABLE>
<CAPTION>

<S>                                                                                    <C>         
         Registration Fee--Securities and Exchange Commission...................        $   4,300.00
         *Blue Sky fees and expenses.............................................       $   1,000.00
         *Accountants' fees and expenses ........................................       $   3,000.00
         *Legal fees and expenses ...............................................       $   5,000.00
         *Printing and EDGAR expenses ...........................................       $   2,000.00
         *Miscellaneous .........................................................       $   2,500.00
                                                                                        ------------
                  Total .........................................................       $  17,800.00
                                                                                        ------------
                                                                                        ------------
</TABLE>

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

* Estimate


Item 15. Indemnification of Directors and Officers.

         The Company has adopted in its Certificate of Incorporation and Bylaws
the provisions of Section 102(b)(7) of the Delaware General Corporation Law
which eliminate or limit the personal liability of a director to the Company or
its stockholders for monetary damages for breach of fiduciary duty as a
director, except that this provision shall not eliminate or limit the liability
of a director for any breach of the director's duty of loyalty to the Company or
its stockholders, for acts or omissions not in good faith or which involve
intentional misconduct or a knowing violation of the law, under Section 174 of
the Delaware General Corporation Law, or for any transaction from which the
director derived an improper personal benefit.

         Further, the Company's Certificate of Incorporation and Bylaws provide
that the Company shall indemnify all persons whom it may indemnify pursuant to
Section 145 of the Delaware Corporation Law to the full extent permitted
therein. Section 145 provides, subject to various exceptions and limitations,
that the Company may indemnify its directors or officers if such director or
officer is a party or is threatened to be made a party to any threatened,
pending or completed action, suit or proceeding, whether civil, criminal,
administrative or investigative, by reason of the fact that he is or was a
director or officer of the Company, or is or was serving at the request of the
Company as a director or officer of another corporation, against expenses
(including attorneys' fees), judgments, fines and amounts paid in settlement
actually and reasonably incurred by him in connection with such action, suit or
proceeding if he acted in good faith and in a manner he reasonably believed to
be in or not opposed to the best interests of the Company, and, with respect to
any criminal action or proceeding, had no reasonable cause to believe his
conduct was unlawful. The determination of whether indemnification is proper
under the circumstances, unless made by a court, shall be made by a majority of
a quorum of disinterested members of the Board of Directors, independent legal
counsel or the stockholders of the Company. In addition, the Company shall
indemnify its directors or officers to the extent that they have been successful
on the merits or otherwise in defense of any such action, suit or proceeding, or
in the defense of any claim, issue or matter therein, against expenses
(including attorneys' fees) actually and reasonably incurred by them in
connection therewith.


Item 16. Exhibits and Financial Statement Schedules.

         (a)      Schedule of Exhibits.


                                      II-1

<PAGE>

<TABLE>
<CAPTION>
     Exhibit
     Number      Exhibit
     -------     -------
  <S>         <C>
     2.1(1)       Agreement and Plan of Merger and Reorganization, dated as of
                  October 24, 1995, by and among the Registrant, DA Acquisition
                  Corp., DirectAmerica Corporation, California Production Group,
                  Inc. and other parties thereto.

     2.2(2)       Agreement and Plan of Merger and Reorganization, dated as of
                  January 17, 1996 and amended as of April 4, 1996, by and among
                  the Registrant, PRT Acquisition Corp. and Positive Response
                  Television, Inc.

     2.3(3)       Acquisition Agreement, dated as of May 30, 1996, by and among
                  Registrant, Paul Meier, Susan Barnes, Alan Meier and Tancot
                  Pty Limited.

     2.4(3)       Acquisition Agreement, dated as of May 29, 1996, by and among
                  Registrant, Paul Meier, Susan Barnes and Prestige Marketing
                  Holdings Limited.

     2.5(4)       Agreement and Plan of Merger and Reorganization, dated as of
                  August 7, 1996, by and among Registrant, NLA Acquisition
                  Corp., Nancy Langston & Associates, Inc. and Nancy Langston.

     2.6(5)       Agreement and Plan of Reorganization and Merger, dated as of
                  January 5, 1998, by and among Registrant, ValueVision
                  International, Inc. and V-L Holdings Corp.

     4.1(6)       Certificate of Designations, Preferences and Rights of Series
                  D Convertible Preferred Stock.

     4.2(6)       Form of Warrant issued in connection with Series D Convertible
                  Preferred Stock.

     4.3(7)       Rights Agreement dated as of January 3, 1994.

     4.4(7)       Amendment No. 1 to Rights Agreement, dated as of March 6,
                  1994.

     4.5(8)       Amendment No. 2 to Rights Agreement, dated as of September 26,
                  1994.

     4.6(8)       Amendment No. 3 to Rights Agreement, dated as of September 30,
                  1994.

     4.7(8)       Amendment No. 4 to Rights Agreement, dated as of November 30,
                  1994.

     4.8(9)       Amendment No. 5 to Rights Agreement, dated as of August 14,
                  1997.

     4.9(8)       Certificate of Designations, Preferences and Rights of Series
                  B Convertible Preferred Stock.

     4.10(10)     Director's Stock Grant Plan.

     4.11(11)     Form of Warrant to Purchase Common Stock of the Registrant,
                  dated November 24, 1995, issued to Value Vision International,
                  Inc. concerning an aggregate of 500,000 shares at an exercise
                  price of $8.865 per share.

     4.12(11)     Form of Warrant to Purchase Common Stock of the Registrant,
                  dated November 24, 1995, issued to various persons concerning
                  an aggregate of 500,000 shares at an exercise price of $10.00
                  per share.

     4.13(12)     Certificate of Designations, Preferences and Rights of the
                  Series C Convertible Preferred Stock.

     4.14(12)     Form of Warrant issued in connection with the Series C
                  Convertible Preferred Stock.

     4.14(a)(6)   Amendment to Form of Warrant issued to holders of Series C
                  Convertible Preferred Stock.

     4.15(13)     Warrant Agreement by and between the Registrant and
                  ValueVision International, Inc., dated as of January 5, 1998,
                  as amended.
</TABLE>


                                      II-2

<PAGE>

<TABLE>
<CAPTION>

  <S>         <C>
     4.16(13)     Warrant Certificate No. 1, dated January 5, 1998, issued by
                  the Registrant to ValueVision International, Inc. to purchase
                  250,000 shares of the Registrant's common stock, as amended.

     5(13)        Opinion and Consent of Brian J. Sisko, Esquire.

    10.1(6)       Amendment No. 1 to Registration Rights Agreement by and among
                  the Company and the Series D Investors.

    10.2(5)       $10,000,000 Demand Promissory Note, dated January 5, 1998,
                  issued by the Company to ValueVision.

    10.3(13)      Warrant Agreement by and between the Company and ValueVision,
                  dated as of September 1998.

    10.4(5)       Registration Rights Agreement by and between the Company and
                  ValueVision, dated as of January 5, 1998.

  23.1(13)        Consent of Ernst & Young LLP, independent auditors, with
                  respect to the consolidated financial statements of National
                  Media Corporation for the year ended March 31, 1997.
</TABLE>

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


(1)      Incorporated by reference to Registrant's Current Report on Form 8-K
         dated October 19, 1995.

(2)      Incorporated by reference to Registrant's Current Report on Form 8-K
         dated May 17, 1996.

(3)      Incorporated by reference to Registrant's Current Report on Form 8-K
         dated July 1, 1996.

(4)      Incorporated by reference to Registrant's Current Report on Form 8-K
         dated August 7, 1996.

(5)      Incorporated by reference to Registrant's Current Report on Form 8-K/A
         dated January 5, 1998.

(6)      Incorporated by reference to Registrant's Registration Statement on
         Form S-3 (File No. 333-48205).

(7)      Incorporated by reference to Registrant's Annual Report on Form 10-K
         for fiscal year ended March 31, 1994.

(8)      Incorporated by reference to Registrant's Annual Report on Form 10-K
         for fiscal year ended March 31, 1995.

(9)      Incorporated by reference to Registrant's Quarterly Report on Form 10-Q
         for the period ended September 30, 1997.

(10)     Incorporated by reference to Registrant's Registration Statement on
         Form S-8 filed October 19, 1995.

(11)     Incorporated by reference to Registrant's Quarterly Report on Form 10-Q
         for the period ended December 31, 1995.

(12)     Incorporated by reference to Registrant's Report on Form 8-K dated
         September 18, 1997.

(13)     Filed herewith.


Item 17. Undertakings.

(a)     The undersigned Registrant hereby undertakes:

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

                  (A)      to include any prospectus required by section 10(a)
(3) of the Securities Act;


                                      II-3

<PAGE>

                  (B) to reflect in the Prospectus any facts or events arising
after the effective date of the Registration Statement (or the most recent
post-effective amendment thereof) which, individually or in the aggregate,
represent a fundamental change in the information set forth in the Registration
Statement.

                  (C) to include any material information with respect to the
plan of distribution not previously disclosed in the Registration Statement or
any material change to such information in the Registration Statement; provided,
however, that paragraphs (1)(i) and (1)(ii) do not apply if the information
required to be included in a post-effective amendment by those paragraphs is
contained in periodic reports filed by the registrant pursuant to Section 13 or
Section 15(d) of the Exchange Act that are incorporated by reference in the
Registration Statement.

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

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

        (iv) For purposes of determining any liability under the Securities Act,
each filing of the registrant's annual report pursuant to Section 13(a) or 15(d)
of the Exchange Act that is incorporated by reference in the Registration
Statement shall be deemed to be a new registration statement relating to the
securities offered herein, and the offering of such securities at that time
shall be deemed to be the initial bona fide offering thereof.

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


                                      II-4

<PAGE>

                                   SIGNATURES

Pursuant to the requirements of the Securities Act of 1933, as amended, the
Registrant 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 Registration
Statement to be signed on its behalf by the undersigned, thereunto duly
authorized, in the City of Philadelphia, Commonwealth of Pennsylvania, on this
25th day of September, 1998.

                        NATIONAL MEDIA CORPORATION


                        BY: /s/ Stephen C. Lehman
                           ---------------------------------------------------
                            Stephen C. Lehman, Acting Chief Executive Officer


                                POWER OF ATTORNEY

Each of the undersigned officers and directors of National Media Corporation
whose signature appears below hereby appoints Frederick S. Hammer as true and
lawful attorney-in-fact for the undersigned with full power of substitution, to
execute in his name and on his behalf in each capacity stated below, any and all
amendments (including post-effective amendments) to this Registration Statement
as the attorney-in-fact shall deem appropriate, and to cause to be filed any
such amendment (including exhibits thereto and other documents in connection
therewith) to this Registration Statement with the Securities and Exchange
Commission, as fully and to all intents and purposes as such person might or
could do in person, hereby ratifying and confirming all that said
attorneys-in-fact, or any of them, may lawfully do or cause to be done by virtue
hereof.

Pursuant to the requirements of the Securities Act of 1933, as amended, this
Registration Statement has been signed by the following persons in the
capacities indicated on this 25th day of September, 1998.

<TABLE>
<CAPTION>

               Signature                                        Title(s)
               ---------                                        --------
<S>                                     <C> 
  /s/ Stephen C. Lehman                     Acting Chief Executive Officer and Director
- ---------------------------------
Stephen C. Lehman

  /s/ John J. Sullivan                      Chief Financial Officer
- ---------------------------------
John J. Sullivan

  /s/ Albert R. Dowden                      Director
- ---------------------------------
Albert R. Dowden

  /s/ William M. Goldstein
- ---------------------------------
William M. Goldstein                        Director

                                            Chairman of the Board and Director
- ---------------------------------
Frederick S. Hammer

  /s/ John W. Kirby                         President and Director
- ---------------------------------
John W. Kirby

  /s/ Andrew M. Schuon                      Director
- ---------------------------------
Andrew M. Schuon

  /s/ Robert N. Verratti                    Director
- ---------------------------------
Robert N. Verratti

  /s/ Eric R. Weiss
- ---------------------------------
Eric R. Weiss                               Director

  /s/ Jon W. Yoskin, II
- ---------------------------------
Jon W. Yoskin,  II                          Director
</TABLE>



<PAGE>

                                  EXHIBIT INDEX
<TABLE>
<CAPTION>

Exhibit
Number            Description
- -------           -----------
<S>             <C>
4.15              Warrant Agreement by and between the Registrant and
                  ValueVision International, Inc., dated as of January 5, 1998,
                  as amended.

4.16              Warrant Certificate No. 1, dated January 5, 1998, issued by
                  the Registrant to ValueVision International, Inc. to purchase
                  250,000 shares of the Registrant's common stock, as amended.

5                 Opinion and Consent of Brian J. Sisko, Esquire.

10.3              Warrant Agreement by and between the Company and ValueVision,
                  dated as of September __, 1998.

23.1              Consent of Ernst & Young LLP, independent auditors, with
                  respect to the consolidated financial statements of National
                  Media Corporation for the year ended March 31, 1998.
</TABLE>










<PAGE>

                                                                    EXHIBIT 4.15



<PAGE>

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














                                WARRANT AGREEMENT



                                 BY AND BETWEEN

                           NATIONAL MEDIA CORPORATION

                                       AND

                         VALUEVISION INTERNATIONAL, INC.



                           DATED AS OF JANUARY 5, 1998













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



<PAGE>

                                TABLE OF CONTENTS

<TABLE>
<CAPTION>

                                                                                                               Page
                                                                                                               ----
<S>               <C>                                                                                         <C>
SECTION 1.            Warrant Certificates........................................................................1

SECTION 2.            Execution of Warrant Certificates...........................................................1

SECTION 3.            Warrant Register............................................................................1

SECTION 4.            Registration of Transfers and Exchanges.....................................................1

SECTION 5.            Warrants; Exercise of Warrants..............................................................2

SECTION 6.            Payment of Taxes............................................................................3

SECTION 7.            Mutilated or Missing Warrant Certificates...................................................3

SECTION 8.            Reservation of Warrant Shares; Rights.......................................................3

SECTION 9.            Obtaining Stock Exchange Listings...........................................................4

SECTION 10.           Adjustment of Exercise Price and Number of Warrant Shares Issuable..........................4

SECTION 11.           Fractional Interests.......................................................................13

SECTION 12.           Notices to Warrant holders.................................................................13

SECTION 13.           Notices to Company and ValueVision.........................................................14

SECTION 14.           Supplements and Amendments.................................................................15

SECTION 15.           Successors.................................................................................15

SECTION 16.           Governing Law..............................................................................15

SECTION 17.           Benefits of This Agreement.................................................................15

SECTION 18.           Counterparts...............................................................................15
</TABLE>

                                       i

<PAGE>

                      THIS WARRANT AGREEMENT (the "Agreement") is dated as of
January 5, 1998 and entered into by and between NATIONAL MEDIA CORPORATION, a
Delaware corporation (the "Company"), and ValueVision International, Inc., a
Minnesota corporation ("ValueVision").

                      WHEREAS, the Company proposes to issue to ValueVision, or
its designee, Common Stock Warrants, as hereinafter described (the "Warrants"),
to purchase up to an aggregate of 250,000 shares of Common Stock, $.01 par value
per share, of the Company (the "Common Stock") (the Common Stock issuable on
exercise of the Warrants being referred to herein as the "Warrant Shares").

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

                      SECTION 1. Warrant Certificates. The certificates
evidencing the Warrants (the "Warrant Certificates") to be delivered pursuant to
this Agreement shall be in registered form only and shall be substantially in
the form set forth in Exhibit A attached hereto.

                      SECTION 2. Execution of Warrant Certificates. Warrant
Certificates shall be signed on behalf of the Company by its Chairman of the
Board or its President or a Vice President and by its Secretary or an Assistant
Secretary under its corporate seal. Each such signature upon the Warrant
Certificates may be in the form of a facsimile signature of the present or any
future Chairman of the Board, President, Vice President, Secretary or Assistant
Secretary and may be imprinted or otherwise reproduced on the Warrant
Certificates and for that purpose the Company may adopt and use the facsimile
signature of any person who shall have been Chairman of the Board, President,
Vice President, Secretary or Assistant Secretary, notwithstanding the fact that
at the time the Warrant Certificates shall be delivered or disposed of he shall
have ceased to hold such office. The seal of the Company may be in the form of a
facsimile thereof and may be impressed, affixed, imprinted or otherwise
reproduced on the Warrant Certificates.

                      In case any officer of the Company who shall have signed
any of the Warrant Certificates shall cease to be such officer before the
Warrant Certificates so signed shall have been disposed of by the Company, such
Warrant Certificates nevertheless may be delivered or disposed of as though such
person had not ceased to be such officer of the Company; and any Warrant
Certificate may be signed on behalf of the Company by any person who, at the
actual date of the execution of such Warrant Certificate, shall be a proper
officer of the Company to sign such Warrant Certificate, although at the date of
the execution of this Warrant Agreement any such person was not such officer.

                      SECTION 3. Warrant Register. The Company shall number and
register the Warrant Certificates in a register as they are issued.

                      SECTION 4. Registration of Transfers and Exchanges. The
Company shall from time to time register the transfer of any outstanding Warrant
Certificates in a Warrant register to be maintained by the Company upon
surrender of such Warrant Certificates accompanied by a written instrument or
instruments of transfer in form satisfactory to the Company, duly executed by
the registered holder or holders thereof or by the duly appointed legal
representative thereof or by a duly authorized attorney. Upon any such
registration of transfer, a new Warrant Certificate shall be issued to the
transferee(s) and the surrendered Warrant Certificate shall be cancelled and
disposed of by the Company.

                                       1

<PAGE>

                      The Warrant holders agree that each certificate 
representing Warrant Shares will bear the following legend:

                      "THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT
                      BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933 OR THE
                      SECURITIES LAWS OF ANY STATE AND MAY NOT BE SOLD OR
                      OTHERWISE DISPOSED OF EXCEPT PURSUANT TO AN EFFECTIVE
                      REGISTRATION STATEMENT UNDER SUCH ACT AND APPLICABLE STATE
                      SECURITIES LAWS OR AN APPLICABLE EXEMPTION TO THE
                      REGISTRATION REQUIREMENTS OF SUCH ACT OR SUCH LAWS."

                      Warrant Certificates may be exchanged at the option of the
holder(s) thereof, when surrendered to the Company at its office for another
Warrant Certificate or other Warrant Certificates of like tenor and representing
in the aggregate a like number of Warrants (in denominations representing a
multiple of 25,000 shares). Warrant Certificates surrendered for exchange shall
be cancelled and disposed of by the Company.

                      If, at the time of the surrender of any of the Warrants in
connection with any exercise, transfer, or exchange of any of the Warrants, the
Company may require, as a condition of allowing such exercise, transfer or
exchange that the holder or transferee of the Warrants, as the case may be,
furnish to the Company a written opinion of counsel (which opinion shall be in
form, substance and scope customary for opinions of counsel in comparable
transactions) to the effect that such exercise, transfer, or exchange may be
made without registration under the Securities Act of 1933, as amended (the
"Securities Act").

                      SECTION 5. Warrants; Exercise of Warrants. (a) Subject to
the terms of this Agreement, at any time after August 15, 1998, each holder of
the Warrants shall have the right, which may be exercised commencing at the
opening of business on the foregoing date and until 5:00 p.m., New York City
time, on January 5, 2003 (the "Exercise Period"), to receive from the Company
the number of fully paid and nonassessable Warrant Shares which the holder may
at the time be entitled to receive on exercise of such Warrants and payment to
the Company of the Exercise Price (as defined below) then in effect for such
Warrant Shares. Each Warrant not exercised prior to 5:00 p.m., New York City
time, on January 5, 2003 shall become null and void and all rights thereunder
and all rights in respect thereof under this Agreement shall cease as of such
time.

                      (b) A Warrant may be exercised by surrender to the Company
at its office designated for such purpose (the address of which is set forth in
Section 13 hereof) of the certificate or certificates evidencing the Warrants to
be exercised with the form of election to purchase on the reverse thereof duly
filled in and signed, which signature shall be guaranteed by a bank or trust
company having an office or correspondent in the United States or a broker or
dealer which is a member of a registered securities exchange or the National
Association of Securities Dealers, Inc., and upon payment to the Company of the
exercise price (the "Exercise Price") which is set forth in the form of Warrant
Certificate attached hereto as Exhibit A, subject to adjustment pursuant to
Section 10, for the number of Warrant Shares in respect of which such Warrants
are then exercised. Payment of the aggregate Exercise Price shall be made (i) in
cash or by certified or official bank check payable to the order of the Company
or (ii) in the manner provided in Section 5(a).

                      Subject to the provisions of Section 6 hereof, upon such
surrender of Warrants and payment of the Exercise Price, the Company shall issue
and cause to be delivered with all reasonable dispatch to or upon the written
order of the holder and in such name or names as the Warrant holder may
designate, a certificate or certificates for the number of full Warrant Shares
issuable upon the

                                       2

<PAGE>

exercise of such Warrants together with cash as provided in Section 11;
provided, however, that if any capital reorganization or reclassification of
capital stock or consolidation, merger or lease or sale of assets is proposed to
be effected by the Company as described in subsection (m) of Section 10 hereof,
or a tender offer or an exchange offer for shares of Common Stock of the Company
shall be made, upon such surrender of Warrants and payment of the Exercise Price
as aforesaid, the Company shall, as soon as possible, but in any event not later
than two business days thereafter, issue and cause to be delivered the full
number of Warrant Shares issuable upon the exercise of such Warrants in the
manner described in this sentence together with cash as provided in Section 11.
Such certificate or certificates shall be deemed to have been issued and any
person so designated to be named therein shall be deemed to have become a holder
of record of such Warrant Shares as of the date of the surrender of such
Warrants and payment of the Exercise Price.

                      The Warrants shall be exercisable, at the election of the
holders thereof, either in full or from time to time in part and, in the event
that a certificate evidencing Warrants is exercised in respect of fewer than all
of the Warrant Shares issuable on such exercise at any time prior to the date of
expiration of the Warrants, a new certificate evidencing the remaining Warrant
or Warrants will be issued and delivered pursuant to the provisions of this
Section and of Section 2 hereof.

                      All Warrant Certificates surrendered upon exercise of
Warrants shall be cancelled and disposed of by the Company. The Company shall
keep copies of this Agreement and any notices given or received hereunder
available for inspection by the Warrant holders during normal business hours at
its office.

                      SECTION 6. Payment of Taxes. The Company will pay all
documentary stamp taxes attributable to the initial issuance of Warrant Shares
upon the exercise of Warrants; provided, however, that the Company shall not be
required to pay any tax or taxes which may be payable in respect of any transfer
involving the issue of any Warrant Certificates or any certificates for Warrant
Shares in a name other than that of the registered holder of a Warrant
Certificate surrendered upon the exercise of a Warrant, and the Company shall
not be required to issue or deliver such Warrant Certificates or certificates
for Warrant Shares unless and until the person or persons requesting the
issuance thereof shall have paid to the Company the amount of such tax or shall
have established to the satisfaction of the Company that such tax has been paid.

                      SECTION 7. Mutilated or Missing Warrant Certificates. In
case any of the Warrant Certificates shall be mutilated, lost, stolen or
destroyed, the Company may in its discretion issue, in exchange and substitution
for and upon cancellation of the mutilated Warrant Certificate, or in lieu of
and substitution for the Warrant Certificate lost, stolen or destroyed, a new
Warrant Certificate of like tenor and representing an equivalent number of
Warrants, but only upon receipt of evidence reasonably satisfactory to the
Company of such loss, theft or destruction of such Warrant Certificate and
indemnity, if requested, also reasonably satisfactory to it. Applicants for such
substitute Warrant Certificates shall also comply with such other reasonable
regulations and pay such other reasonable charges as the Company may prescribe.

                      SECTION 8. Reservation of Warrant Shares; Rights. The
Company will at all times reserve and keep available, free from preemptive
rights, out of the aggregate of its authorized but unissued Common Stock or its
authorized and issued Common Stock held in its treasury, for the purpose of
enabling it to satisfy any obligation to issue Warrant Shares upon exercise of
Warrants, the maximum number of shares of Common Stock which may then be
deliverable upon the exercise of all outstanding Warrants.

                                       3

<PAGE>

                      The Company shall issue, together with each Warrant Share
issued upon exercise of a Warrant, one Right (as defined in the Merger
Agreement) (or other securities in lieu thereof), and any rights issued to
holders of Common Stock in addition thereto or in replacement therefor, whether
or not such rights shall be exercisable at such time, but only if such rights
are issued and outstanding and held by other holders of Common Stock at such
time and have not expired.

                      The Company or, if appointed, the transfer agent for the
Common Stock (the "Transfer Agent") and every subsequent transfer agent for any
shares of the Company's capital stock issuable upon the exercise of any of the
rights of purchase aforesaid will be irrevocably authorized and directed at all
times to reserve such number of authorized shares as shall be required for such
purpose. The Company will keep a copy of this Agreement on file with the
Transfer Agent and with every subsequent transfer agent for any shares of the
Company's capital stock issuable upon the exercise of the rights of purchase
represented by the Warrants. The Company will furnish such Transfer Agent a copy
of all notices of adjustments and certificates related thereto, transmitted to
each holder pursuant to Section 12 hereof.

                      Before taking any action which would cause an adjustment
pursuant to Section 10 hereof to reduce the Exercise Price below the then par
value (if any) of the Warrant Shares, the Company will take any corporate action
which may, in the opinion of its counsel, be necessary in order that the Company
may validly and legally issue fully paid and nonassessable Warrant Shares at the
Exercise Price as so adjusted.

                      The Company covenants that all Warrant Shares which may be
issued upon exercise of Warrants will, upon issue, be fully paid, nonassessable,
free of preemptive rights and free from all taxes, liens, charges and security
interests with respect to the issue thereof.

                      SECTION 9. Obtaining Stock Exchange Listings. The Company
shall from time to time take all action which may be necessary so that the
Warrant Shares, immediately upon their issuance upon the exercise of Warrants,
will be listed on the principal securities exchanges and markets within the
United States of America, if any, on which other shares of Common Stock are then
listed.

                      SECTION 10. Adjustment of Exercise Price and Number of
Warrant Shares Issuable. The Exercise Price and the number of Warrant Shares
issuable upon the exercise of each Warrant are subject to adjustment from time
to time upon the occurrence of the events enumerated in this Section 10. For
purposes of this Section 10, "Common Stock" means shares now or hereafter
authorized of any class of common stock of the Company and any other stock of
the Company, however designated, that has the right (subject to any prior rights
of any class or series of preferred stock) to participate in any distribution of
the assets or earnings of the Company without limit as to per share amount.

         (a)          Adjustment for Change in Capital Stock.

                      If the Company:

                      (1) pays a dividend or makes a distribution on its Common
         Stock in shares of its Common Stock;

                      (2) subdivides its outstanding shares of Common Stock into
         a greater number of shares; or

                                       4

<PAGE>

                      (3) combines its outstanding shares of Common Stock into a
         smaller number of shares;

then the Exercise Price in effect immediately prior to such action shall be
proportionately adjusted in accordance with the formula:


                                            O
                                 E' = E x  ---
                                            A


Where:

         E'=          the adjusted Exercise Price

         E =          the current Exercise Price

         O =          the number of shares of Common Stock outstanding prior to 
                      such action

         A =          the number of shares of Common Stock outstanding 
                      immediately after such action

                      In the case of a dividend or distribution the adjustment
shall become effective immediately after the record date for determination of
holders of shares of Common Stock entitled to receive such dividend or
distribution, and in the case of a subdivision or combination, the adjustment
shall become effective immediately after the effective date of such corporate
action.

                      If after an adjustment a holder of a Warrant upon exercise
of it may receive shares of two or more classes of capital stock of the Company,
the Company shall determine the allocation of the adjusted Exercise Price
between the classes of capital stock. After such allocation, the exercise
privilege and the Exercise Price of each class of capital stock shall thereafter
be subject to adjustment on terms comparable to those applicable to Common Stock
in this Section 10.

                      Such adjustment shall be made successively whenever any
event listed above shall occur.

         (b)          Adjustment for Rights Issue.

                      If the Company distributes any rights, options or warrants
to all holders of its Common Stock entitling them at any time after the record
date mentioned below to purchase shares of Common Stock at a price per share
less than the Current Market Price (as defined in Section 10(f)) per share on
that record date, the Exercise Price shall be adjusted in accordance with the
formula:


                                                   N x P
                                               O + -----
                                                    M
                                     E' = E x  ------------
                                                  O + N


                                       5

<PAGE>

where:

     E'=  the adjusted Exercise Price.

     E=   the current Exercise Price.

     O=   the number of shares of Common Stock outstanding on the record date.

     N=   the number of additional shares of Common Stock issuable upon exercise
          of the rights, options or warrants offered.

     P=   the exercise price per share of the additional shares issuable upon
          exercise of the rights, options or warrants.

     M=   the Current Market Price per share of Common Stock on the record date.

                      The adjustment shall be made successively whenever any
such rights, options or warrants are issued and shall become effective
immediately after the record date for the determination of stockholders entitled
to receive the rights, options or warrants. If at the end of the period during
which such rights, options or warrants are exercisable, (i) not all rights,
options or warrants shall have been exercised, or (ii) the exercise price per
share for which shares of Common Stock are issuable pursuant to such rights,
options or warrants shall be increased or decreased solely by virtue of
provisions therein contained for an automatic increase or decrease in such
exercise price per share upon the occurrence of a specified date or event, then,
the Exercise Price shall be immediately readjusted to what it would have been
if, in the case of clause (i) above, "N" in the above formula had been the
number of shares actually issued or, in the case of clause (ii) above, "P" in
the above formula had been the exercise price per share, as so increased or
decreased, as the case may be.

         (c)      Adjustment for Other Distributions.

                      If the Company distributes to all holders of its Common
Stock any of its assets (including but not limited to cash), debt securities,
preferred stock, or any rights or warrants to purchase debt securities,
preferred stock, assets or other securities of the Company, the Exercise Price
shall be adjusted in accordance with the formula:

                                         M - F
                                E' = E x -----
                                           M


where:

     E'=  the adjusted Exercise Price.

     E=   the current Exercise Price.

     M=   the Current Market Price per share of Common Stock on the record date
          mentioned below.

                                       6

<PAGE>

     F=   the Fair Market Value (as defined in Section 10(f)) on the record date
          of the assets, securities, rights or warrants applicable to one share
          of Common Stock.

                  The adjustment shall be made successively whenever any such
distribution is made and shall become effective immediately after the record
date for the determination of stockholders entitled to receive the distribution.

                  This subsection does not apply to rights, options or warrants
referred to in subsection (b) of this Section 10 or distributions of business
units of the Company covered by subsection (n) of this Section 10.

         (d)      Adjustment for Below Market Issuances of Common Stock.

                  If the Company issues shares of Common Stock for a
consideration per share less than the Current Market Price per share on the date
the Company fixes the offering price of such additional shares, the Exercise
Price shall be adjusted in accordance with the formula:


                                              P
                                         O + ---
                                              M
                                E' = E x -----------
                                              A


where:


     E'=  the adjusted Exercise Price.

     E=   the then current Exercise Price.

     O=   the number of shares outstanding immediately prior to the issuance of
          such additional shares.

     P=   the aggregate consideration received for the issuance of such 
          additional shares.

     M=   the Current Market Price per share on the date of issuance of such
          additional shares.

     A=   the number of shares outstanding immediately after the issuance of
          such additional shares.

                  The adjustment shall be made successively whenever any such
issuance is made, and shall become effective immediately after such issuance.

                  This subsection (d) does not apply to:

                  (1)      any of the transactions described in subsections (b)
                           and (c) of this Section 10,

                  (2)      the exercise of the Warrants, or


                                       7

<PAGE>

                  (3)      Common Stock issued upon the exercise of rights or
         warrants issued to the holders of Common Stock for which rights or 
         warrants an adjustment has been made pursuant to Section 10(b) or 
         Section 10(e),

         No duplicative adjustment shall be made in the event of a right,
warrant or convertible or exchangeable security requiring an adjustment
hereunder and the subsequent exercise or conversion of such right, warrant or
convertible or exercisable security.

         (e)      Adjustment for Below Market Issuances of Convertible or
                  Exchangeable Securities.

                  If the Company issues any securities convertible into or
exchangeable for Common Stock (other than securities issued in transactions
described in subsections (b) and (c) of this Section 10) for a consideration per
share of Common Stock initially deliverable upon conversion or exchange of such
securities less than the Current Market Price per share on the date of issuance
of such convertible or exchangeable securities, the Exercise Price shall be
adjusted in accordance with this formula:


                                                 P
                                            O + ---
                                                 M
                                  E' = E x --------
                                            O + D

where:

     E'=  the adjusted Exercise Price.

     E=   the then current Exercise Price.

     O=   the number of shares outstanding immediately prior to the issuance of
          such convertible or exchangeable securities.

     P=   the aggregate consideration received for the issuance of such
          convertible or exchangeable securities.

     M=   the Current Market Price per share on the date of issuance of such
          convertible or exchangeable securities.

     D=   the maximum number of shares deliverable upon conversion or in
          exchange for such convertible or exchangeable securities at the 
          initial conversion or exchange rate.

                  The adjustment shall be made successively whenever any such
issuance is made, and shall become effective immediately after such issuance.

                  If (i) all of the Common Stock deliverable upon conversion or
exchange of such securities have not been issued when such securities are no
longer outstanding, or (ii) the exercise price per share for which shares of
Common Stock are issuable pursuant to such securities shall be increased or
decreased solely by virtue of provisions therein contained for an automatic
increase or decrease in such exercise price per share upon the occurrence of a
specified date or event, then the Exercise Price shall promptly be readjusted in
accordance with the formula in this Section 10(e) to

                                       8

<PAGE>

the Exercise Price which would then be in effect had the adjustment upon the
issuance of such securities been made on the basis of, in the case of clause (i)
above, the actual number of shares of Common Stock issued upon conversion or
exchange of such securities or, in the case of clause (ii) above, the exercise
price per share, as so increased or decreased, as the case may be.

         (f)      Certain Definitions.

                  (1)      Current Market Price.

                  In subsections (b), (c), (d) and (e) of this Section 10, the
                  current market price per share of Common Stock on any date is:

                           (i) if the Common Stock is not registered under the
                  Securities Exchange Act of 1934, as amended (the "Exchange
                  Act"), then the Fair Market Value of the Common Stock based
                  upon the Fair Market Value of 100% of Company if sold as a
                  going concern and without regard to any discount for the lack
                  of liquidity or on the basis that the relevant shares of the
                  Common Stock do not constitute a majority or controlling
                  interest in Company and assuming, if applicable, the exercise
                  or conversion of all in-the-money warrants, convertible
                  securities, options or other rights to subscribe for or
                  purchase any additional shares of capital stock of Company or
                  securities convertible or exchangeable into such capital
                  stock; or

                           (ii) if the Common Stock is registered under the
                  Exchange Act, the average of the Quoted Prices of the Common
                  Stock for 20 consecutive trading days immediately preceding
                  the date in question. The "Quoted Price" of the Common Stock
                  is the last reported sales price of the Common Stock on the
                  New York Stock Exchange ("NYSE"), or if the Common Stock is
                  reported by Nasdaq National Market System, as reported by
                  Nasdaq National Market System, or if the Common Stock is
                  listed on a national securities exchange other than the NYSE,
                  the last reported sales price of the Common Stock on such
                  exchange (which shall be for consolidated trading if
                  applicable to such exchange), or if neither so reported or
                  listed, the last reported bid price of the Common Stock.

                  (2) Fair Market Value. Fair Market Value means the value
                  obtainable upon a sale in an arm's length transaction to a
                  third party under usual and normal circumstances, with neither
                  the buyer nor the seller under any compulsion to act, with
                  equity to both, as determined by the Board of Directors of the
                  Company (the "Board") in good faith; provided, however, that
                  if ValueVision shall dispute the Fair Market Value as
                  determined by the Board, ValueVision may undertake to have it
                  and the Company retain an Independent Expert. The
                  determination of Fair Market Value by the Independent Expert
                  shall be final, binding and conclusive on the Company and
                  ValueVision. All costs and expenses of the Independent Expert
                  shall be borne by ValueVision unless the determination of Fair
                  Market Value by the Independent Expert is more than 5% more
                  favorable to Company than the Fair Market Value determined by
                  the Board, in which event the cost of the Independent Expert
                  shall be shared equally by ValueVision and Company, or more
                  than 10% more favorable to Company than the Fair Market Value
                  determined by the Board, in which event the cost of the
                  Independent Expert shall be borne solely by Company.

                                       9

<PAGE>

                  (3) Independent Expert. Independent Expert means an investment
                  banking firm reasonably agreeable to Company and ValueVision
                  who does not (and whose Affiliates do not) have a financial
                  interest in Company or any of its Affiliates.

         (g)      Consideration Received.

                  For purposes of any computation respecting consideration
received pursuant to subsections (d) and (e) of this Section 10, the following
shall apply:

                  (1) in the case of the issuance of shares of Common Stock for
         cash, the consideration shall be the amount of such cash, provided that
         in no case shall any deduction be made for any commissions, discounts
         or other expenses incurred by the Company for any underwriting of the
         issue or otherwise in connection therewith;

                  (2) in the case of the issuance of shares of Common Stock for
         a consideration in whole or in part other than cash, the consideration
         other than cash shall be deemed to be the Fair Market Value thereof;

                  (3) in the case of the issuance of securities convertible into
         or exchangeable for shares, the aggregate consideration received
         therefor shall be deemed to be the consideration received by the
         Company for the issuance of such securities at the date of such
         issuance plus the additional consideration as of the date of such
         issuance, if any, to be received by the Company upon the conversion or
         exchange thereof (the consideration in each case to be determined in
         the same manner as provided in clauses (1) and (2) of this subsection).

         (h)      When De Minimis Adjustment May Be Deferred.

                  No adjustment in the Exercise Price need be made unless the
adjustment would require an increase or decrease of at least 1% in the Exercise
Price. Any adjustments that are not made shall be carried forward and taken into
account in any subsequent adjustment.

                  All calculations under this Section shall be made to the
nearest cent or to the nearest 1/100th of a share, as the case may be.

         (i)      When No Adjustment Required.

                  No adjustment need be made for rights to purchase Common Stock
pursuant to a Company plan for reinvestment of dividends or interest.

                  No adjustment need be made for a change in the par value or no
par value of the Common Stock.

                  No adjustment will be made for shares issued upon the exercise
of the Warrants, upon the conversion of the Demand Note, upon conversion of the
Series C Convertible Preferred Stock outstanding on the date hereof (or the
Series D Convertible Preferred Stock issuable in exchange therefore) or upon the
exercise of the 750,000 options owned by Robert Verratti as of the date hereof.

                  To the extent the Warrants become convertible into cash, no
adjustment need be made thereafter as to the cash. Interest will not accrue on
the cash.

                                       10

<PAGE>

         (j)      Notice of Adjustment.

                  Whenever the Exercise Price is adjusted, the Company shall
provide the notices required by Section 12 hereof.

         (k)      Voluntary Reduction.

                  The Company from time to time may reduce the Exercise Price by
any amount for any period of time if the period is at least 20 days and if the
reduction is irrevocable during the period; provided, however, that in no event
may the Exercise Price be less than the par value of a share of Common Stock.

                  Whenever the Exercise Price is reduced, the Company shall mail
to Warrant holders a notice of the reduction. The Company shall mail the notice
at least 15 days before the date the reduced Exercise Price takes effect. The
notice shall state the reduced Exercise Price and the period it will be in
effect.

                  A reduction of the Exercise Price does not change or adjust
the Exercise Price otherwise in effect for purposes of subsections (a), (b),
(c), (d) and (e) of this Section 10.

         (l)      Notice of Certain Transactions.

                  If:

                  (1) the Company takes any action that would require an
         adjustment in the Exercise Price pursuant to subsections (a), (b), (c),
         (d) or (e) of this Section 10 and if the Company does not arrange for
         Warrant holders to participate pursuant to subsection (i) of this
         Section 10;

                  (2) the Company takes any action that would require a
         supplemental Warrant Agreement pursuant to subsection (m) of this
         Section 10; or

                  (3)      there is a liquidation or dissolution of the Company,

the Company shall mail to Warrant holders a notice stating the proposed record
date for a dividend or distribution or the proposed effective date of a
subdivision, combination, reclassification, consolidation, merger, transfer,
lease, liquidation or dissolution. The Company shall mail the notice at least 15
days before such date. Failure to mail the notice or any defect in it shall not
affect the validity of the transaction.

         (m)      Reorganization of Company.

                  If the Company effects a capital reorganization or
recapitalization of its capital stock or consolidates or merges with or into, or
transfers or leases all or substantially all its assets to, any person, then, as
a condition precedent to the consummation of such transaction, lawful and
adequate provisions shall be made whereby the Warrant holder shall thereafter
have the right to purchase and receive upon the basis and the terms and
conditions specified in this Agreement and in lieu of the shares of Common Stock
immediately theretofore purchasable and receivable upon the exercise of the
rights represented hereby, such shares of stock, securities, cash or other
assets which the holder of a Warrant would have received immediately after the
reorganization, recapitalization, consolidation, merger, transfer or lease if
the holder had exercised such Warrant immediately before

                                       11

<PAGE>

the effective date of the transaction, and in any case appropriate provision
shall be made with respect to the rights and interests of the holders thereof to
the end that the provisions hereof (including without limitation provisions for
adjustments of the number of shares of Common Stock purchasable and receivable
upon the exercise of the Warrants) shall thereafter be applicable, as nearly as
may be, in relation to any shares of stock, securities, cash or assets
thereafter deliverable upon the exercise thereof. The Company shall not effect
any such consolidation, merger, transfer or lease, unless, prior to the
consummation thereof, the corporation formed by or surviving any such
consolidation or merger if other than the Company, or the person to which such
sale or conveyance shall have been made, shall enter into and deliver to the
holders of Warrants at the last address thereof appearing on the books of the
Company, a supplemental Warrant Agreement so providing and further providing for
adjustments which shall be as nearly equivalent as may be practical to the
adjustments provided for in this Section.

                  If the issuer of securities deliverable upon exercise of
Warrants under the supplemental Warrant Agreement is an affiliate of the formed,
surviving, transferee or lessee corporation, that issuer shall join in the
supplemental Warrant Agreement.

                  If this subsection (m) applies, subsections (a), (b), (c), (d)
and (e) of this Section 10 do not apply.

         (n)      [Intentionally Omitted]

         (o)      When Issuance or Payment May Be Deferred.

                  In any case in which this Section 10 shall require that an
adjustment in the Exercise Price be made effective as of a record date for a
specified event, the Company may elect to defer until the occurrence of such
event (i) issuing to the holder of any Warrant exercised after such record date
the Warrant Shares and other capital stock of the Company, if any, issuable upon
such exercise over and above the Warrant Shares and other capital stock of the
Company, if any, issuable upon such exercise on the basis of the Exercise Price
and (ii) paying to such holder any amount in cash in lieu of a fractional share
pursuant to Section 11; provided, however, that the Company shall deliver to
such holder a due bill or other appropriate instrument evidencing such holder's
right to receive such additional Warrant Shares, other capital stock and cash
upon the occurrence of the event requiring such adjustment.

         (p)      Adjustment in Number of Shares.

                  Upon each adjustment of the Exercise Price pursuant to this
Section 10, each Warrant outstanding prior to the making of the adjustment in
the Exercise Price shall thereafter evidence the right to receive upon payment
of the adjusted Exercise Price that number of shares of Common Stock (calculated
to the nearest hundredth) obtained from the following formula:


                                            E
                                  N' = N x ---
                                            E'


where:

                                       12

<PAGE>

     N'= the adjusted number of Warrant Shares issuable upon exercise of a
         Warrant by payment of the adjusted Exercise Price.

     N=  the number or Warrant Shares previously issuable upon exercise of a
         Warrant by payment of the Exercise Price immediately prior to
         adjustment.

     E'= the adjusted Exercise Price.

     E=  the Exercise Price immediately prior to adjustment.

         (q)      Form of Warrants.

                  Irrespective of any adjustments in the Exercise Price or the
number or kind of shares purchasable upon the exercise of the Warrants, Warrants
theretofore or thereafter issued may continue to express the same price and
number and kind of shares as are stated in the Warrants initially issuable
pursuant to this Agreement.

                  SECTION 11. Fractional Interests. The Company shall not be
required to issue fractional Warrant Shares on the exercise of Warrants. If more
than one Warrant shall be presented for exercise in full at the same time by the
same holder, the number of full Warrant Shares which shall be issuable upon the
exercise thereof shall be computed on the basis of the aggregate number of
Warrant Shares purchasable on exercise of the Warrants so presented. If any
fraction of a Warrant Share would, except for the provisions of this Section 11,
be issuable on the exercise of any Warrants (or specified portion thereof), the
Company shall pay an amount in cash equal to the Current Market Price (as
defined in Section 10(f)) on the day immediately preceding the date the Warrant
is presented for exercise, multiplied by such fraction.

                  SECTION 12. Notices to Warrant holders. Upon any adjustment of
the Exercise Price pursuant to Section 10, the Company shall promptly thereafter
(i) cause to be filed with the Secretary of the Company a certificate of the
Chief Operating Officer and Chief Financial Officer of the Company setting forth
the Exercise Price after such adjustment and setting forth in reasonable detail
the method of calculation and the facts upon which such calculations are based
and setting forth the number of Warrant Shares (or portion thereof) issuable
after such adjustment in the Exercise Price, upon exercise of a Warrant and
payment of the adjusted Exercise Price, which certificate shall, absent manifest
error, be conclusive evidence of the correctness of the matters set forth
therein, and (ii) cause to be given to each of the registered holders of the
Warrant Certificates at his address appearing on the Warrant register written
notice of such adjustments and a copy of such certificate by first-class mail,
postage prepaid. Where appropriate, such notice may be given in advance and
included as a part of the notice required to be mailed under the other
provisions of this Section 12.

                  In case:

                  (a) the Company shall authorize the issuance to all holders of
         shares of Common Stock of rights, options or warrants to subscribe for
         or purchase shares of Common Stock or of any other subscription rights
         or warrants; or

                  (b) the Company shall authorize the distribution to all
         holders of shares of Common Stock of evidences of its indebtedness or
         assets (other than cash dividends or cash distributions payable out of
         consolidated earnings or earned surplus or dividends payable in

                                       13

<PAGE>

         shares of Common Stock or distributions referred to in subsection (a) 
of Section 10 hereof); or

                  (c) of any consolidation or merger to which the Company is a
         party and for which approval of any shareholders of the Company is
         required, or of the conveyance or transfer of the properties and assets
         of the Company substantially as an entirety, or of any reclassification
         or change of Common Stock issuable upon exercise of the Warrants (other
         than a change in par value, or from par value to no par value, or from
         no par value to par value, or as a result of a subdivision or
         combination), or a tender offer or exchange offer for shares of Common
         Stock; or

                  (d) of the voluntary or involuntary dissolution, liquidation
         or winding up of the Company;

                  (e) the Company proposes to take any action (other than
         actions of the character described in Section 10(a)) which would
         require an adjustment of the Exercise Price pursuant to Section 10; or

                  (f) the Company proposes to participate in any transaction
         described in either Section 10(m) or Section 10(n);

then the Company shall cause to be given to each of the registered holders of
the Warrant Certificates at his address appearing on the Warrant register, at
least 10 business days prior to the applicable record date hereinafter
specified, or promptly in the case of events for which there is no record date,
by first-class mail, postage prepaid, a written notice stating (i) the date as
of which the holders of record of shares of Common Stock to be entitled to
receive any such rights, options, warrants or distribution are to be determined,
or (ii) the initial expiration date set forth in any tender offer or exchange
offer for shares of Common Stock, or (iii) the date on which any such
consolidation, merger, conveyance, transfer, dissolution, liquidation or winding
up is expected to become effective or consummated, and the date as of which it
is expected that holders of record of shares of Common Stock shall be entitled
to exchange such shares for securities or other property, if any, deliverable
upon such reclassification, consolidation, merger, conveyance, transfer,
dissolution, liquidation or winding up. The failure to give the notice required
by this Section 12 or any defect therein shall not affect the legality or
validity of any distribution, right, option, warrant, consolidation, merger,
conveyance, transfer, dissolution, liquidation or winding up, or the vote upon
any action.

                  Nothing contained in this Agreement or in any of the Warrant
Certificates shall be construed as conferring upon the holders thereof the right
to vote or to consent or to receive notice as shareholders in respect of the
meetings of shareholders or the election of Directors of the Company or any
other matter, or any rights whatsoever as shareholders of the Company.

                  SECTION 13. Notices to Company and ValueVision. Any notice or
demand authorized by this Agreement to be given or made by the registered holder
of any Warrant Certificate to or on the Company shall be sufficiently given or
made when and if deposited in the mail, first class or registered, postage
prepaid, addressed to the office of the Company expressly designated by the
Company at its office for purposes of this Agreement (until the Warrant holders
are otherwise notified in accordance with this Section by the Company), as
follows:

                                       14

<PAGE>

                  if to the Company, initially at Eleven Penn Center, Suite
         1100, 1835 Market Street, Philadelphia, Pennsylvania 19103, Attention:
         General Counsel and thereafter at such other address, notice of which
         is given in accordance with the provisions of this Section 13, with a
         copy to Klehr, Harrison, Harvey, Branzburg & Ellers LLP, 1401 Walnut
         Street, Philadelphia, Pennsylvania 19102, Attention: Stephen T.
         Burdumy, Esq.

                  Any notice pursuant to this Agreement to be given by the
         Company to the registered holder(s) of any Warrant Certificate shall be
         sufficiently given when and if deposited in the mail, first-class or
         registered, postage prepaid, addressed (until the Company is otherwise
         notified in accordance with this Section by such holder) to such holder
         at the following address:

                  if to a registered holder of any Warrant Certificate, at the
         most current address given by such holder to the Company in accordance
         with the provisions of this Section 13, which address initially is,
         with respect to ValueVision, 6740 Shady Oak Road, Eden Praire,
         Minnesota 55344-3433, Attention: General Counsel, with a copy to Latham
         & Watkins, 633 West Fifth Street, Los Angeles, California 90071,
         Attention: Michael Sturrock, Esq.


                  SECTION 14.       Supplements and Amendments.  This Agreement 
may be supplemented or amended from time to time subject to approval by the 
parties hereto.

                  SECTION 15.       Successors.  All the covenants and 
provisions of this Agreement by or for the benefit of the Company shall bind and
inure to the benefit of its respective successors and assigns hereunder.

                  SECTION 16.       Governing Law. This Agreement and each 
Warrant Certificate issued hereunder shall be deemed to be a contract made under
the laws of the State of Delaware and for all purposes shall be construed in
accordance with the internal laws of said State.

                  SECTION 17.       Benefits of This Agreement. Nothing in this
Agreement shall be construed to give to any person or corporation other than the
Company and the registered holders of the Warrant Certificates any legal or
equitable right, remedy or claim under this Agreement; and this Agreement shall
be for the sole and exclusive benefit of the Company and the registered holders
of the Warrant Certificates.

                  SECTION 18.       Counterparts.  This Agreement may be 
executed in any number of counterparts and each of such counterparts shall for
all purposes be deemed to be an original, and all such counterparts shall
together constitute but one and the same instrument.

                            [Signature Page Follows]

                                       15

<PAGE>

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


                                            NATIONAL MEDIA CORPORATION



                                            By:
                                               ---------------------------------
                                                Title:







                                            VALUEVISION INTERNATIONAL, INC.
                                            (OR ITS DESIGNEE)



                                             By:
                                                --------------------------------
                                                 Title:


                                       S-1


<PAGE>

                                                                    EXHIBIT 4.16


THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER
THE SECURITIES ACT OF 1933 OR THE SECURITIES LAWS OF ANY STATE AND MAY NOT BE
SOLD OR OTHERWISE DISPOSED OF EXCEPT PURSUANT TO AN EFFECTIVE REGISTRATION
STATEMENT UNDER SUCH ACT AND APPLICABLE STATE SECURITIES LAWS OR AN APPLICABLE
EXEMPTION TO THE REGISTRATION REQUIREMENT OF SUCH ACT OR SUCH LAWS.

<PAGE>

No. 1                                                             250,000 Shares

                               Warrant Certificate

                           NATIONAL MEDIA CORPORATION

                  This Warrant Certificate certifies that ValueVision
International, Inc., ("ValueVision") or registered assigns, is the registered
holder of 250,000 Warrants expiring on January 5, 2003 (the "Warrants") to
purchase Common Stock, $.01 par value (the "Common Stock"), of NATIONAL MEDIA
CORPORATION, a Delaware corporation (the "Company"). Each Warrant entitles the
holder upon exercise to receive from the Company on or before 5:00 p.m. New York
City Time on January 5, 2003, one fully paid and nonassessable share of Common
Stock (a "Warrant Share") at the initial exercise price (the "Exercise Price")
equal to $2.74 per share of Common Stock, payable in lawful money of the United
States of America upon surrender of this Warrant Certificate and payment of the
Exercise Price at the office of the Company designated for such purpose, but
only subject to the conditions set forth herein and in the Warrant Agreement
referred to on the reverse hereof. The Exercise Price and number of Warrant
Shares issuable upon exercise of the Warrants are subject to adjustment upon the
occurrence of certain events set forth in the Warrant Agreement.

                  No Warrant may be exercised after 5:00 p.m., New York Time on
January 5, 2003, and to the extent not exercised by such time such Warrants
shall become null and void.

                  Reference is hereby made to the further provisions of this
Warrant Certificate set forth below and such further provisions shall for all
purposes have the same effect as though fully set forth at this place.

                  This Warrant Certificate shall not be valid unless signed by
officers of the Company as set forth in Section 2 of the Warrant Agreement.



<PAGE>

                  IN WITNESS WHEREOF, the Company has caused this Warrant
Certificate to be signed by its President and by its Secretary and has caused
its corporate seal to be affixed hereunto or imprinted hereon.

Dated:  January 5, 1998


                                             NATIONAL MEDIA CORPORATION


                                             By:
                                                --------------------------------
                                                President


                                             By:
                                                --------------------------------
                                                Secretary


<PAGE>

                                   [Continued]

                  The Warrants evidenced by this Warrant Certificate are part of
a duly authorized issue of Warrants expiring on January 5, 2003. The Warrants
(issued in denominations representing a multiple of 25,000 shares) entitle the
holder on exercise to receive shares of Common Stock, $0.01 par value, of the
Company (the "Common Stock"), and are issued or to be issued pursuant to a
Warrant Agreement dated as of January 5, 1998, as amended (the "Warrant
Agreement"), duly executed and delivered by the Company, which Warrant Agreement
is hereby incorporated by reference in and made a part of this instrument and is
hereby referred to for a description of the rights, limitation of rights,
obligations, duties and immunities thereunder of the Company and the holders
(the words "holders" or "holder" meaning the registered holders or registered
holder) of the Warrants. A copy of the Warrant Agreement may be obtained by the
holder hereof upon written request to the Company.

                  Warrants may be exercised at any time after August 15, 1998
and before January 5, 2003. The holder of Warrants evidenced by this Warrant
Certificate may exercise them by surrendering this Warrant Certificate, with the
form of election to purchase set forth hereon properly completed and executed,
together with payment of the Exercise Price at the office of the Company
designated for such purpose, but only subject to the conditions set forth herein
and in the Warrant Agreement referred to below. In the event that upon any
exercise of Warrants evidenced hereby the number of Warrants exercised shall be
less than the total number of Warrants evidenced hereby, there shall be issued
to the holder hereof or his assignee a new Warrant Certificate evidencing the
number of Warrants not exercised. No adjustment shall be made for any dividends
on any Common Stock issuable upon exercise of this Warrant.

                  The Warrant Agreement provides that upon the occurrence of
certain events the Exercise Price set forth on the face hereof may, subject to
certain conditions, be adjusted. If the Exercise Price is adjusted, the Warrant
Agreement provides that the number of shares of Common Stock issuable upon the
exercise of each Warrant shall be adjusted. No fractions of a share of Common
Stock will be issued upon the exercise of any Warrant, but the Company will pay
the cash value thereof determined as provided in the Warrant Agreement.

                  The holders of the Warrants are entitled to certain
registration rights with respect to the Common Stock purchasable upon exercise
thereof. Said registration rights are set forth in full in a Registration Rights
Agreement dated as of January 5, 1998, between the Company and ValueVision (as
amended by that certain letter agreement, dated August 11, 1998, between the
Company and ValueVision). A copy of the Registration Rights Agreement (as
amended) may be obtained by the holder hereof upon written request to the
Company.

                  Warrant Certificates, when surrendered at the office of the
Company by the registered holder thereof in person or by legal representative or
attorney duly authorized in writing, may be exchanged, in the manner and subject
to the limitations provided in the Warrant Agreement, but without payment of any
service charge, for another Warrant Certificate or Warrant Certificates of like
tenor evidencing in the aggregate a like number of Warrants.



<PAGE>

                  Upon due presentation for registration of transfer of this
Warrant Certificate at the office of the Company a new Warrant Certificate or
Warrant Certificates of like tenor and evidencing in the aggregate a like number
of Warrants shall be issued to the transferee(s) in exchange for this Warrant
Certificate, subject to the limitations provided in the Warrant Agreement,
without charge except for any tax or other governmental charge imposed in
connection therewith.

                  The Company may deem and treat the registered holder(s) hereof
as the absolute owner(s) of this Warrant Certificate (notwithstanding any
notation of ownership or other writing hereon made by anyone), for the purpose
of any exercise hereof, of any distribution to the holder(s) hereof, and for all
other purposes, and the Company shall not be affected by any notice to the
contrary. Neither the Warrants nor this Warrant Certificate entitles any holder
hereof to any rights of a stockholder of the Company.



<PAGE>

                         [Form of Election to Purchase]

                    (To Be Executed Upon Exercise Of Warrant)


                  The undersigned hereby irrevocably elects to exercise the
right, represented by this Warrant Certificate, to receive __________ shares of
Common Stock and herewith tenders payment for such shares to the order of
NATIONAL MEDIA CORPORATION in the amount of $_________ in accordance with the
terms hereof. The undersigned requests that a certificate for such shares be
registered in the name of ________________, whose address is
_______________________________ and that such shares be delivered to
________________ whose address is ___________ ______________________. If said
number of shares is less than all of the shares of Common Stock purchasable
hereunder, the undersigned requests that a new Warrant Certificate representing
the remaining balance of such shares be registered in the name of
______________, whose address is _________________________, and that such
Warrant Certificate be delivered to _________________, whose address is
__________________.


                                        Signature:
                                                  ------------------------------


Date:
     -----------------------------


                                 Signature Guaranteed:
                                                      --------------------------




<PAGE>

                                                                       EXHIBIT 5



<PAGE>

                           NATIONAL MEDIA CORPORATION
                         Eleven Penn Center, Suite 1100
                               1835 Market Street
                             Philadelphia, PA 19103







                               September 25, 1998











Board of Directors
National Media Corporation
Eleven Penn Center, Suite 1100
1835 Market Street
Philadelphia, Pennsylvania 19103

         Re:      Registration Statement on Form S-3

Gentlemen:

         I am general counsel to National Media Corporation (the "Company") and
have caused to be prepared a registration statement on Form S-3 in connection
with the proposed registration of shares of the Company's common stock, par
value $.01 per share (the "Common Stock") pursuant to the Securities Act of
1933, as amended (the "Securities Act"). Such registration statement, as it may
be amended or supplemented from time to time, including all exhibits thereto, is
referred to hereinafter as the "Registration Statement."

         The shares to be registered (the "Offered Shares") consist of (i)
4,318,579 shares of Common Stock (the "ValueVision Conversion Shares") issuable
pursuant to the terms of a promissory note executed by the Company in favor of
ValueVision International, Inc. ("ValueVision"), as amended by a letter
agreement, dated August 11, 1998, between NM Acquisition Co., LLC, the Company
and ValueVision. The Offered Shares may be offered and sold from time to time
for the account of the entity referred to in the Registration Statement as
"Selling Stockholder."



<PAGE>

Board of Directors
September 25, 1998
Page 2


         In this regard, I have examined: (i) the agreements (the "Agreements")
pursuant to which the Selling Stockholder has received or may acquire the
Offered Shares from the Company; (ii) the Company's Certificate of Incorporation
and Bylaws, each as amended and as presently in effect; (iii) the Registration
Statement; and (iv) such officers' certificates, resolutions, minutes, corporate
records and other documents as I have deemed necessary or appropriate for
purposes of rendering the opinions expressed herein.

         In rendering such opinions, I have assumed the authenticity of all
documents and records examined, the conformity with the original documents of
all documents submitted to me as copies and the genuineness of all signatures.

         The opinions expressed herein are based solely upon my review of the
documents and other materials expressly referred to above. Other than such
documents and related materials, I have not reviewed any documents in rendering
such opinions. Such opinions are therefore qualified by the scope of that
document examination.

         Based upon and subject to the foregoing, and on such other examinations
of law and fact as I have deemed necessary or appropriate in connection
herewith, I am of the opinion that, upon issuance in accordance with the
provisions of the appropriate Agreements, the ValueVision Conversion Shares will
be duly authorized, validly issued, fully paid and nonassessable shares of
Common Stock.

         This opinion is limited to the laws of the Commonwealth of Pennsylvania
and the General Corporation Law of the State of Delaware; provided, however,
that no opinion is hereby rendered as to the state securities laws of either the
Commonwealth of Pennsylvania or the State of Delaware. Except as expressly
otherwise noted herein, this opinion is given as of the date hereof.

         I hereby consent to the filing of this opinion as an exhibit to the
Registration Statement and to the reference made to me under the caption "Legal
Matters" in the Prospectus constituting a part of the Registration Statement. By
giving such consent, I do not hereby admit that I fall within the category of
persons whose consent is required pursuant to Section 7 of the Securities Act.


                                       Very truly yours,

                                       /s/ Brian J. Sisko, Esq.

                                       Brian J. Sisko, Esq.




<PAGE>

                                                                    EXHIBIT 10.3



<PAGE>

NEITHER THIS WARRANT NOR THE SECURITIES ISSUABLE UPON EXERCISE HEREOF NOR ANY
INTEREST OR PARTICIPATION HEREIN OR THEREIN MAY BE SOLD, ASSIGNED, PLEDGED,
HYPOTHECATED, ENCUMBERED OR IN ANY OTHER MANNER TRANSFERRED OR DISPOSED OF
EXCEPT IN COMPLIANCE WITH THE SECURITIES ACT OF 1933, AS AMENDED (THE
"SECURITIES ACT") AND THE TERMS AND CONDITIONS HEREOF. THE HOLDER OF THIS
WARRANT AND THE SECURITIES ISSUABLE UPON EXERCISE HEREOF ARE SUBJECT TO THE
RESTRICTIONS HEREIN SET FORTH.

THESE SECURITIES ARE HELD SUBJECT TO THE TERMS, COVENANTS AND CONDITIONS OF
TELEMARKETING, PRODUCTION AND POST-PRODUCTION AGREEMENT DATED APRIL 13, 1995 BY
AND AMONG NATIONAL MEDIA COMPANY (THE "COMPANY") AND VALUEVISION INTERNATIONAL,
INC. ("VVI"), AS AMENDED BY THAT CERTAIN AGREEMENT, DATED AUGUST 11, 1998 BY AND
AMONG THE COMPANY, NM ACQUISITION CO., LLC AND VVI, AND MAY NOT BE SOLD IN AN
OPEN MARKET TRANSACTION EXCEPT IN ACCORDANCE WITH THE TERMS AND PROVISIONS
THEREOF. A COPY OF SAID AGREEMENT IS ON FILE AND MAY BE INSPECTED AT THE
PRINCIPAL EXECUTIVE OFFICES OF THE COMPANY.

VOID AFTER 5:00 P.M., PHILADELPHIA, PENNSYLVANIA TIME, NOVEMBER 23, 2005


                     **************************************


                                     WARRANT
                                       to
                              PURCHASE COMMON STOCK
                                       of
                           NATIONAL MEDIA CORPORATION



                     **************************************

         This certifies that, for good and valuable consideration, National
Media Corporation, a Delaware corporation (the "Company"), grants to ValueVision
International, Inc. ("VVI") or permitted registered assigns (the "Warrantholder"
or "Warrantholders"), the right to subscribe for and purchase from the Company,
at $2.74 per share (the "Exercise Price"), from and after 9:00 A.M.
Philadelphia, Pennsylvania time on November 23, 1996 (the "Initial Exercise
Date"), and to and including 5:00 P.M. New York City time on November 23, 2005
(the "Expiration Date"), 500,000 shares, as such number of shares may be
adjusted from time to time (the "Warrant Shares"), of the Company's Common
Stock, par value $0.01 per share (the "Common Stock"), subject to the provisions
and upon the terms and conditions herein set forth. The Exercise Price and the
number of Warrant Shares are subject to adjustment from time to time as provided
in Section 6.


                                        1

<PAGE>

SECTION 1.  Exercise of Warrant; Limitation on Exercise; Payment of Taxes.

         1.1 Exercise of Warrant.

                  (a) Subject to Section 1.1(d) hereof, this Warrant shall vest
and become exercisable with respect to 166,667 Warrant Shares on December 23,
1996 and on November 23, 1997 and with respect to 166,666 Warrant Shares on
November 23, 1998 (each date on which Warrants may vest is referred to herein as
a "Vesting Date"). At any time and from time to time after the Initial Exercise
Date, the Warrantholder may exercise this Warrant, in whole or in part (subject
to the vesting of the Warrant as set forth in the immediately preceding
sentence), by presentation and surrender of this Warrant to the Company at its
principal executive offices or at the office of its stock transfer agent, if
any, with the Subscription Form annexed hereto duly executed and accompanied by
cash payment of the full Exercise Price for each Warrant Share to be purchased
(subject to VVI's ability to apply certain amounts payable by the Company to VVI
under the Telemarketing Agreement (as defined in Section 1.1(d) hereof) against
the Exercise Price as set forth in Section 1.3 hereof).

                  (b) Upon receipt of this Warrant, with the Subscription Form
duly executed and accompanied by payment of the aggregate Exercise Price for the
Warrant Shares for which this Warrant is then being exercised, the Company shall
cause to be issued certificates for the total number of whole shares of Common
Stock for which this Warrant is being exercised (adjusted to reflect the effect
of the antidilution provisions contained in Section 6 hereof, if any, and as
provided in Sections 5 and 8.8 hereof) in such denominations as are requested
for delivery to the Warrantholder, and the Company shall thereupon deliver such
certificates to the Warrantholder. The stock certificates so delivered shall be
in such denominations as may be specified by the Warrantholder and shall be
issued in the name of the Warrantholder or, if permitted by Section 5 and in
accordance with the provisions thereof, such other name as shall be designated
in the Subscription Form. The Warrantholder shall be deemed to be the holder of
record of the shares of Common Stock issuable upon such exercise,
notwithstanding that the stock transfer books of the Company shall then be
closed or that certificates representing such shares of Common Stock shall not
then be actually delivered to the Warrantholder. If at the time this Warrant is
exercised, a registration statement is not in effect to register under the
Securities Act of 1933, the Warrant Shares issuable upon exercise of this
Warrant, the Company may require the Warrantholder to make such customary
representations, and may place such customary legends on certificates
representing the Warrant Shares, as may be reasonably required in the opinion of
counsel to the Company to permit the Warrant Shares to be issued without such
registration.

                  (c) If this Warrant shall have been exercised only in part,
the Company shall, at the time of delivery of the certificates for the Warrant
Shares, deliver to the Warrantholder a new Warrant evidencing the rights to
purchase the remaining Warrant Shares, which new Warrant shall in all other
respects be identical with this Warrant. No adjustments or payments shall be
made on or in respect of Warrant Shares issuable on the exercise of this Warrant
for any regular cash dividends paid or payable to holders of record of Common
Stock prior to the date as of which the Warrantholder shall be deemed to be the
record holder of such Warrant Shares.

                  (d) Notwithstanding anything herein to the contrary, no
Warrants shall vest on a Vesting Date in the event (i) VVI shall be in material
breach of that certain Telemarketing, Production and Post-Production Agreement
dated April 13, 1995 by and between the Company and

                                        2

<PAGE>

VVI (the "Telemarketing Agreement") on such Vesting Date unless the Company
shall thereafter fail to terminate the Telemarketing Agreement as a result of
such breach; (ii) any representation made by VVI in Section 9 of that certain
Settlement Agreement dated April 13, 1995 by and between the Company and VVI
(the "Settlement Agreement") shall not be true on such Vesting Date or (iii) VVI
shall have failed, after receiving written notice of such failure from the
Company at least sixty (60) days prior to such Vesting Date, to make available
to the Company sufficient capacity to provide to the Company inbound telephone
call-taking services for at least one million (1,000,000) inbound telephone
calls (at a rate not to exceed 100,000 inbound telephone calls in any month)
during the thirteen (13) month period (in the case of the first Vesting Date
hereunder) or the twelve (12) month period (in the case of the second and third
Vesting Dates hereunder) preceding such Vesting Date in accordance with Section
l(a) of the Telemarketing Agreement.

         1.2 Limitation on Exercise. If this Warrant is not exercised prior to
5:00 P.M. on the Expiration Date (or the next succeeding Business Day, if the
Expiration Date is a Saturday, Sunday or a day on which the New York Stock
Exchange is authorized to close or on which the Company is otherwise closed for
business (a "Nonbusiness Day"), this Warrant, or any new Warrant issued pursuant
to Section 1.1, shall cease to be exercisable and shall become void and all
rights of the Warrantholder hereunder shall cease. This Warrant shall not be
exercisable and no Warrant Shares shall be issued hereunder, prior to 9:00 A.M.
New York City time on the Initial Exercise Date.

         1.3 Payment of Exercise Price. Payment of the Exercise Price shall be
made to the Company in cash; by certified or official bank check payable in
United States dollars to the order of the Company; or by any combination of the
foregoing. Notwithstanding the foregoing, VVI may apply all or any part of the
aggregate amount of any Telemarketing Differential (as defined in the
Telemarketing Agreement) and any Production and Post Production Differential (as
defined in the Telemarketing Agreement) against payment of the Exercise Price by
providing irrevocable notice of such election to the Company on the Subscription
Form. Any election by VVI to apply Telemarketing Differential or Production and
Post Production Differential against all or any portion of the Exercise Price
due hereunder shall be irrevocable and shall reduce the amount of Telemarketing
Differential and Production and Post Production Differential available for
application against future exercises of this Warrant.

         1.4 Payment of Taxes. The issuance of certificates for Warrant Shares
shall be made without charge to the Warrantholder for any stock transfer or
other issuance tax in respect thereto; provided, however, that the Warrantholder
shall be required to pay any and all taxes which may be payable in respect to
any transfer involved in the issuance and delivery of any certificates for
Warrant Shares in a name other than that of the then Warrantholder as reflected
upon the books of the Company.

SECTION 2.  Reservation and Listing of Shares, Etc.

All Warrant Shares which are issued upon the exercise of the rights represented
by this Warrant shall, upon issuance and payment of the Exercise Price, be
validly issued, fully paid and nonassessable and free from all taxes, liens,
security interests, charges and other encumbrances with respect to the issue
thereof other than taxes in respect of any transfer occurring contemporaneously
with such issue. During the period within which this Warrant may be exercised,
the Company shall at all times have authorized and reserved, and keep available
free from preemptive rights, a sufficient number of shares of Common Stock to
provide for the exercise of this Warrant, and if at

                                        3

<PAGE>

any time the number of authorized but unissued shares of Common Stock shall not
be sufficient to effect the exercise of this Warrant (and all other Warrants and
securities of the Company convertible into or exercisable or exchangeable for
Common Stock), in addition to such other remedies as shall be available to a
Warrantholder, the Company will take such corporate action as may, in the
opinion of its counsel, be necessary to increase its authorized but unissued
shares of Common Stock to such number of shares as shall be sufficient for such
purposes. In addition, prior to the issuance of any Warrant Shares, the Company
shall at its expense procure the listing of the Warrant Shares (or any other
issues of capital stock issuable upon the exercise of this Warrant if such other
class of capital stock is then so listed) which shall be issued upon exercise of
this Warrant (subject to official notice of issuance) as then may be required on
all stock exchanges or interdealer quotation systems on which the Common Stock
is then listed and shall maintain such listing if and so long as any shares of
the same class shall be listed on such stock exchanges or interdealer quotation
systems. The Company shall, from time to time, take all such action as may be
required to assure that the par value per share of the Warrant Shares is at all
times equal to or less than the then effective Exercise Price.

SECTION 3.  Exchange, Loss or Destruction of Warrants.

If permitted by Section 5 and in accordance with the provisions thereof, upon
surrender of this Warrant to the Company with a duly executed instrument of
assignment and funds sufficient to pay any transfer tax, the Company shall,
without charge, execute and deliver a new Warrant of like tenor in the name of
the assignee named in such instrument of assignment and this Warrant shall
promptly be cancelled. Upon receipt by the Company of evidence reasonably
satisfactory to it of the loss, theft, destruction or mutilation of this
Warrant, and, in the case of loss, theft or destruction, of such bond or
indemnification as the Company may reasonably require, and, in the case of such
mutilation, upon surrender and cancellation of this Warrant, the Company will
execute and deliver a new Warrant of like tenor. The term "Warrant" as used
herein includes any Warrants issued in substitution or exchange of this Warrant.

SECTION 4.  Ownership of Warrant; Certain Rights of Warrantholders.

                  (a) The Company may deem and treat the person in whose name
this Warrant is registered as the holder and owner hereof (notwithstanding any
notations of ownership or writing hereon made by anyone other than the Company)
for all purposes and shall not be affected by any notice to the contrary, until
presentation of this Warrant for registration of transfer as provided in
subsection 1.1, Section 3 or Section 5.

                  (b) Nothing contained in this Warrant shall be construed as
conferring upon the Warrantholder or its transferees the right to vote or to
receive dividends or to consent or to receive notice as a stockholder in respect
of any meeting of stockholders for the election of directors of the Company or
of any other matter, or any rights whatsoever as stockholders of the Company.
The Company shall give notice to the Warrantholder by registered mail if at any
time prior to the expiration or exercise in full of the Warrants, any of the
following events shall occur:

                           (i) the Company shall authorize the payment of 
any dividend payable in any securities upon shares of Common Stock or authorize 
the making of any distribution (other than a regular cash dividend paid out of 
net profits legally available therefor) to all holders of Common Stock;

                                        4

<PAGE>

                           (ii) the Company shall authorize the issuance to 
all holders of Common Stock of any additional shares of Common Stock or
securities that are convertible into or exercisable for shares of Common Stock
("Common Stock Equivalents") or of rights, options or warrants to subscribe for
or purchase Common Stock or Common Stock Equivalents or of any other
subscription rights, options or warrants;

                           (iii) a dissolution, liquidation or winding up of 
the Company (other than in connection with a consolidation, merger, or sale or
conveyance of the property of the Company as an entirety or substantially as an
entirety); or

                           (iv) a capital reorganization or reclassification
of the Common Stock (other than a subdivision or combination of the outstanding
Common Stock and other than a change in the par value of the Common Stock) or
any consolidation or merger of the Company with or into another corporation
(other than a consolidation or merger in which the Company is the continuing
corporation and that does not result in any reclassification or change of Common
Stock outstanding) or in the case of any sale or conveyance to another
corporation of the property of the Company as an entirety or substantially as an
entirety.

                  Such giving of notice shall be initiated at least 20 days
prior to the date fixed as a record date or effective date or the date of
closing of the Company's stock transfer books for the determination of the
stockholders entitled to such dividend, distribution, issuance or subscription
rights, or for the determination of the stockholders entitled to vote on such
proposed merger, consolidation, sale, conveyance, dissolution, liquidation or
winding up. Such notice shall specify such record date or the date of closing
the stock transfer books, as the case may be. Failure to provide such notice
shall not affect the validity of any action taken in connection with such
dividend, distribution, issuance or subscription rights, or proposed merger,
consolidation, sale, conveyance, dissolution, liquidation or winding up.

SECTION 5.  Split-Up, Combination, Exchange and Transfer of Warrant.

                  (a) Subject to the provisions of Section 5(b), this Warrant
may be split up, combined or exchanged for another Warrant or Warrants
containing the same terms to purchase a like aggregate number of Warrant Shares.
If the Warrantholder desires to split up, combine or exchange this Warrant, he,
she or it shall make such request in writing delivered to the Company and shall
surrender to the Company this Warrant and any other Warrants to be so split up,
combined or exchanged. Upon any such surrender for a split up, combination or
exchange, the Company shall execute and deliver to the person entitled thereto a
Warrant or Warrants, as the case may be, as so requested. The Company shall not
be required to effect any split up, combination or exchange which will result in
the issuance of a Warrant entitling the Warrantholder to purchase upon exercise
a fraction of a share of Common Stock or a fractional Warrant. The Company may
require such Warrantholder to pay a sum sufficient to cover any tax or
governmental charge that may be imposed in connection with any split up,
combination or exchange of Warrants.

                  (b) Prior to the termination of the Telemarketing Agreement,
neither this Warrant nor any of Warrantholder's rights hereunder may be disposed
of or encumbered (any such action, a "Transfer") without the prior written
consent of the Company. Neither this Warrant nor the Warrant Shares may be
transferred except in accordance with and subject to the provisions of the
Securities Act and the rules and regulations promulgated thereunder. If at the
time of a

                                        5

<PAGE>

Transfer, a registration statement is not in effect to register this Warrant or
the Warrant Shares, the Company may require the Warrantholder to make such
customary representations, and may place such customary legends on certificates
representing this Warrant, as may be reasonably required in the opinion of
counsel to the Company to permit a Transfer without such registration.

SECTION 6.  Certain Adjustments.

                  (a) If at any time or from time to time the Company shall (i)
take a record of the holders of the Common Stock for the purpose of entitling
them to receive a dividend payable in, or other distribution of, shares of
Common Stock, (ii) subdivide the outstanding shares of Common Stock into a
larger number of shares of Common Stock or (iii) combine the outstanding shares
of Common Stock into a smaller number of shares of Common Stock, then the number
of shares of Common Stock thereafter issuable upon exercise of this Warrant and
the Exercise Price then in effect shall be adjusted so that this Warrant shall
be exercisable for the same number of shares that a record holder of the number
of shares of Common Stock issuable upon exercise of this Warrant immediately
prior to the happening of such event would own or be entitled to receive after
the happening of such event and so that the aggregate Exercise Price payable for
the purchase of all Warrant Shares pursuant to this Warrant shall remain
unchanged. Any adjustments required by this Section 6(a) shall be made whenever
and as often as any specified event requiring an adjustment shall occur. If the
Company shall take a record of the holders of the Common Stock for the purpose
of effecting such distribution, subdivision or combination and shall, thereafter
and before such distribution, subdivision, or combination, legally abandon its
plan to pay or deliver such distribution or effect such subdivision or
combination, then thereafter no adjustment shall be required by reason of the
taking of such record and any such adjustment previously made in respect thereof
shall be rescinded and annulled.

                  (b) If at any time prior to the exercise of this Warrant in
full, the Company shall (i) issue or sell any Common Stock or Common Stock
Equivalents without consideration or for consideration per share (in cash,
property or other assets) less than the current market price per share on the
date of such issuance or sale as determined pursuant to Section 6(d) or (ii) fix
a record date for the issuance of subscription rights, options or warrants to
all holders of Common Stock entitling them to subscribe for or purchase Common
Stock (or Common Stock Equivalents (as hereinafter defined)) at a price (or
having an exercise or conversion price per share) less than the current market
price of the Common Stock (as determined pursuant to Section 6(d)) on the record
date described below, the Exercise Price shall be adjusted so that the Exercise
Price shall equal the price determined by multiplying the Exercise Price in
effect immediately prior to the date of such sale or issuance (which date in the
event of a distribution to stockholders shall be deemed to be the record date
set by the Company to determine stockholders entitled to participate in such
distribution) by a fraction, the numerator of which shall be (i) the number of
shares of Common Stock outstanding on the date of such sale or issuance, plus
(ii) the number of additional shares of Common Stock which the aggregate
consideration received by the Company upon such issuance or sale (plus the
aggregate of any additional amount to be received by the Company upon the
exercise of such subscription rights, options or warrants) would purchase at
such current market price per share of the Common Stock and the denominator of
which shall be (i) the number of shares of Common Stock outstanding on the date
of such issuance or sale, plus (ii) the number of additional shares of Common
Stock offered for subscription or purchase (or into which the Common Stock
Equivalents so offered are exercisable or convertible). Whenever the Exercise
Price payable upon exercise of this Warrant is adjusted pursuant to this Section
6(b), the number of Warrant Shares

                                        6

<PAGE>

issuable upon exercise of this Warrant shall simultaneously be adjusted by
multiplying the number of Warrant Shares issuable upon exercise of this Warrant
by the Exercise Price in effect on the date of such adjustment and dividing the
product so obtained by the Exercise Price, as adjusted. Any adjustments required
by this Section 6(b) shall be made immediately after such issuance or sale or
record date, as the case may be. Such adjustments shall be made successively
whenever such event shall occur. To the extent that shares of Common Stock (or
Common Stock Equivalents) are not delivered in connection with such subscription
rights, options or warrants, the Exercise Price shall be readjusted to the
Exercise Price which would then be in effect had the adjustments made upon the
issuance of such rights, options or warrants been made upon the basis of
delivery of only the number of shares of Common Stock (or Common Stock
Equivalents) actually delivered. In the case of an issue of additional Common
Stock or Common Stock Equivalents for cash, the consideration received by the
Company therefor, before deducting therefrom any discount or commission or other
expenses allowed, paid or incurred by the Company for underwriting of, or
otherwise in connection with, the issuance thereof, shall be deemed to be the
amount received by the Company therefor. In the case of an issue of additional
Common Stock or Common Stock Equivalents for consideration in whole or in part
other than cash, the consideration other than cash shall be deemed to be the
fair value thereof as reasonably determined by the Company's Board of Directors,
irrespective of any accounting treatment. No adjustments to the Exercise Price
or the number of Warrant Shares issuable upon exercise of this Warrant shall be
made pursuant to this Section 6(b) for (x) any transaction for which adjustment
thereto is required to be made pursuant to Section 6(a) hereof, (y) the exercise
of Warrants or (2) the conversion, exchange or exercise of any Common Stock
Equivalents.

                  (c) For purposes of this Section 6, "Common Stock
Equivalents" shall mean any options, warrants or other securities or rights
convertible into, or exercisable or exchangeable for, shares of Common Stock.

                  (d) For the purpose of any computation under this Section 6,
the current market price per share of Common Stock at any date shall be deemed
to be the average of the daily closing prices for the 20 consecutive trading
days immediately preceding such date. The closing price for each day shall be
the last sale price of the Common Stock or, in case no such reported sales take
place on such day, the average of the last reported bid and asked prices of the
Common Stock in either case on the principal national securities exchange on
which the Common Stock is admitted to trading or listed, or if not listed or
admitted to trading on any such exchange, the representative closing bid price
of the Common Stock as reported by NASDAQ, or other similar organization if
NASDAQ is no longer reporting such information, or if not so available, the fair
market price of the Common Stock as determined by the Company's Board of
Directors. The term "issue" shall include the sale other disposition of shares
held by or on account of the Company or in the treasury of the Company but until
so sold or otherwise disposed of such shares shall not be deemed outstanding.

                  (e) In the event that at any time, as a result of any
adjustment made pursuant to Section 6, the Warrantholder thereafter shall become
entitled to receive any shares of the Company other than Common Stock,
thereafter the number of such other shares so receivable upon exercise of any
Warrant shall be subject to adjustment from time to time in a manner and on
terms as nearly equivalent as practicable to the provisions with respect to the
Common Stock contained in Section 6.


                                        7

<PAGE>

                  (f) In case of any reclassification, capital reorganization or
other change of outstanding shares of Common Stock (other than a dividend,
distribution, subdivision or combination of the outstanding Common Stock
provided for in Section 6(a) and other than a change in the par value of the
Common Stock or in case of any consolidation or merger of the Company with or
into another corporation (other than a merger with a subsidiary in which the
Company is the continuing corporation and that does not result in any
reclassification, capital reorganization or other change of outstanding shares
of Common Stock of the class issuable upon exercise of this Warrant)) or in case
of any sale, lease, transfer or conveyance to another corporation of the
property and assets of the Company as an entirety or substantially as an
entirety, the Company shall, as a condition precedent to such transaction, cause
such successor or purchasing corporation, as the case may be, to execute with
the Warrantholder an agreement granting the Warrantholder the right thereafter,
upon payment of the Exercise Price in effect immediately prior to such action,
to receive upon exercise of this Warrant the kind and amount of shares and other
securities and property which it, he or she would have owned or have been
entitled to receive after the happening of such reclassification, change,
consolidation, merger, sale or conveyance had this Warrant been exercised
immediately prior to such action. Such agreement shall provide for adjustments
in respect of such shares of stock and other securities and property, which
shall be as nearly equivalent as may be practicable to the adjustments provided
for in this Section 6. In the event that in connection with any such
reclassification, capital reorganization, change, consolidation, merger, sale or
conveyance, additional shares of Common Stock shall be issued in exchange,
conversion, substitution or payment, in whole or in part, for, or of, a security
of the Company other than Common Stock, any such issue shall be treated as an
issue of Common Stock covered by the provisions of this Section 6. The
provisions of this Section 6 shall similarly apply to successive
reclassifications, capital reorganizations, consolidations, mergers, sales or
conveyances.

                  (g) Liquidating Dividends, Etc. If the Company at any time
while Warrants are outstanding and unexpired makes a distribution of its assets
to the holders of its Common Stock as a dividend in liquidation or by way of
return of capital or other than as a dividend payable out of earnings or surplus
legally available for dividends under applicable law or any distribution to such
holders made in respect of the sale of all or substantially all of the Company's
assets (other than under the circumstances provided for in the foregoing
subsections (a) through (f)), the holder of this Warrant shall be entitled to
receive upon the exercise hereof, in addition to the shares of Common Stock
receivable upon such exercise, and without payment of any consideration other
than the Exercise Price, an amount in cash equal to the value of such
distribution per share of Common Stock multiplied by the number of shares of
Common Stock which, on the record date for such distribution, are issuable upon
exercise of this Warrant (with no further adjustment being made following any
event which causes a subsequent adjustment in the number of shares of Common
Stock issuable upon the exercise hereof), and an appropriate provision therefor
should be made as part of any such distribution. The value of a distribution
which is paid in other than cash shall be determined in good faith by the Board
of Directors.

                  (h) If at any time prior to the date of the original issuance
of this Warrant, or at any time thereafter while this Warrant is outstanding, a
Distribution Date (as defined in the Company's Rights Agreement as of January 3,
1994 by and between the Company and Mellon Securities Trust Company (the "Rights
Plan") shall occur and all of the Rights (as defined in the Rights Plan) then
issued and outstanding pursuant to such Rights Plan shall not be redeemed by the
Company for nominal consideration of $.001 per Right within the redemption
period provided for in Section 23 of the Rights Plan, then in such event there
shall be promptly issued to the holder of this

                                        8

<PAGE>

Warrant, that number of Rights under the Rights Plan as would have been issued
to such holder if immediately prior to the Distribution Date the holder had
exercised his right to purchase, and the Company had issued to him, all Warrant
Shares issuable to him upon exercise of this Warrant and he was the record owner
of such Warrant Shares on the date provided for in the Rights Plan for
determining the stockholders of record entitled to receive Rights Certificates
(as defined in the Rights Plan). If the Company shall be prohibited from issuing
such Rights to the Warrant holder by law or by the terms of the Rights Plan,
then the Warrant Holder shall have the right under this paragraph (h) to
purchase or acquire (by exchange of securities or otherwise) the same number and
class of equity securities of the Company as such holder would have had the
right to so purchase or otherwise acquire if the Rights described in the
preceding sentence had been issued to him, for the same consideration as the
holder would have paid or tendered under such Rights and on the same other terms
and conditions as would have been applicable under such Rights if such Rights
had been issued to such holder as provided in the preceding sentence. The intent
of this paragraph (h) is to protect the holder of the Warrant from the dilution
of and diminution in the value of his investment in the Company that would occur
if the Rights under the Rights Plan become exercisable or exchangeable for stock
of the Company following the occurrence of a Distribution Date and the
provisions of this Warrant shall be liberally interpreted in order to give
effect to this intention. The Board of Directors of the Company shall also take
such other actions as may be necessary to carry out the purpose and intent of
this paragraph.

                  (i) No Impairment. The Company will not, by amendment of its
Certificate of Incorporation or through any reorganization, recapitalization,
transfer of assets, consolidation, merger, dissolution, issue or sale of
securities or any other voluntary action, avoid or seek to avoid the observance
or performance of any of the terms to be observed or performed hereunder by the
Company, but will at all times in good faith assist in the carrying out of all
the provisions of this Section 6 and in the taking of all such action as may be
necessary or appropriate in order to protect the rights of the Warrantholders
against impairment.

                  (j) Certificate as to Adjustments. Upon the occurrence of each
adjustment or readjustment of the Exercise Price pursuant to this Section 6, the
Company, at its expense, shall promptly compute such adjustment or readjustment
in accordance with the terms hereof and prepare and furnish to each
Warrantholder a certificate setting forth such adjustment or readjustment and
showing in detail the facts upon which such adjustment or readjustment is based.
The Company shall, upon the written request at any time of any Warrantholder,
furnish or cause to be furnished to such holder a like certificate setting forth
(A) such adjustment and readjustment, (B) the Exercise Price at the time in
effect, and (C) the number of shares of Common Stock and the amount, if any, of
other property which at the time would be received upon the exercise of this
Warrant.

SECTION 7. Registration Rights. Each present and future holder of Warrant Shares
shall be entitled to the benefits of the registration rights granted pursuant to
this Section 7.

         The Company covenants and agrees as follows:

                  (a) Definitions.  For purposes of this Section 7:

                           (i) The term "register," "registered," and 
"registration" refer to a registration effected by preparing and filing a 
registration statement or similar document in

                                        9

<PAGE>

compliance with the Securities Act, and the declaration or ordering of
effectiveness of such registration statement or document;

                           (ii) The term "Registrable Securities" means the
Warrant Shares and all shares of Common Stock issued as (or issuable upon the
conversion or exercise of any warrant, right or other security which is issued
as) a dividend or other distribution with respect to, or in exchange for or in
replacement of, any of the Warrant Shares excluding in all cases, however, any
Registrable Securities (x) sold by a person in a transaction in which his rights
under this Section 7 are not assigned, (y) sold in a public offering registered
under the Securities Act or (z) sold pursuant to Rule 144 promulgated under the
Securities Act;

                           (iii) The number of shares of "Registrable Securities
then outstanding" shall be determined by the number of shares of Common Stock
outstanding which are, and the number of shares of Common Stock issuable
pursuant to then exercisable or convertible securities which are, Registrable
Securities;

                           (iv) The term "Holder" means any person owning or
having the right to acquire Registrable Securities or any assignee thereof in
accordance with Section 5(b) hereof, and

                           (v) The term "Form S-3" means such form under the
Securities Act as in effect on the date hereof or any registration form under
the Securities Act subsequently adopted by the SEC which permits inclusion or
incorporation of substantial information by reference to other documents filed
by the Company with the SEC.

                  (b) Request for Registration.

                           (i) If the Company shall receive at any time, on
or after the first anniversary hereof, a written request from the Holders of a
majority of the Registrable Securities then outstanding that the Company file a
registration statement under the Securities Act covering the registration of at
least sixty percent (60%) of the Registrable Securities then outstanding, then
the Company shall, within ten (10) business days of the receipt thereof, give
written notice of such request to all Holders, and shall, subject to the
limitations of Section 7(b)(ii), effect as soon as practicable, and in any event
within 90 days of the receipt of such request, the registration under the
Securities Act of the Registrable Securities which the Holders request to be
registered within twenty (20) days of the mailing of such notice by the Company.
If within fifteen (15) days of the exercise of a demand registration right
granted under this Section 7(b), the Company notifies the Holders of the
Registrable Securities making such demand that the Company wishes to register
securities of the same class for its own account on the registration statement
being filed pursuant to the demand for offering to the public via a firm
commitment underwriting, then the Company may include securities for its own
account in such registration statement; provided, however, that if the managing
underwriter determines and advises in writing that the inclusion of any or all
such securities for the Company's account in the registration statement covered
by the requests for registration made under this Section 7(b)(ii) would be
detrimental to the offering of the Registrable Securities being sold in such
registration, then the requisite number of securities for the Company's account
shall be excluded from registration hereunder and, provided, further, that if
the Company includes any securities for its own account on the registration
statement filed pursuant to this Section 7(b), such registration shall not be
counted as one of Holders' demand registrations pursuant

                                       10

<PAGE>

to this Section 7(b) and the Holders shall not be required to reimburse the
Company for any expenses incurred by it in connection with such registration.

                           (ii) If the Holders initiating the registration 
request hereunder (the "Initiating Holders") intend to distribute the
Registrable Securities covered by their request by means of an underwriting,
they shall so advise the Company as a part of their request made pursuant to
this Section 7(b) and the Company shall include such information in the written
notice referred to in Section 7(b)(i). In such event, the right of any Holder to
include its, his or her Registrable Securities in such registration shall be
conditioned upon such Holder's participation in such underwriting and the
inclusion of such Holder's Registrable Securities in the underwriting (unless
otherwise mutually agreed by a majority in interest of the Initiating Holders
and such Holder) to the extent provided herein. All Holders proposing to
distribute their securities through such underwriting shall (together with the
Company as provided in Section 7(d)(v)) enter into an underwriting agreement in
customary form with the underwriter or underwriters selected for such
underwriting by a majority in interest of the Initiating Holders. VVI
acknowledges that the Preference Holders (as hereinafter defined) have the right
to include certain securities in any registration under this Section 7(b).
Notwithstanding any other provision of this Section 7(b), if the underwriter
advises the Initiating Holders in writing that marketing factors require a
limitation of the number of shares to be underwritten, then the Company shall so
advise all Holders of Registrable Securities which would otherwise be
underwritten pursuant hereto, and the number of shares of securities that may be
included in the underwriting shall be allocated first among all holders (the
"Preference Holders") of Company securities covered by the registration rights
("Other Securities") granted pursuant to either that certain Securities Purchase
Agreement dated as of September 30, 1994 (as amended as of December 19, 1994) by
and among the Company and the purchasers named therein or that certain
Registration Rights Agreement dated as of December 19, 1994 by and among the
Company and the other signatories thereto or those certain Warrants to purchase
an aggregate of up to 66,264 shares of the Company's Common Stock issued
pursuant to that certain Release and Settlement Agreement dated February 10,
1995 by and between the Company and The Wall Street Group, Inc. (the "Preferred
Rights"); and next among all Initiating Holders and other Holders who have been
provided the notice required by Section 7(b)(i) in proportion (as nearly as
practicable) to the number of shares of Registrable Securities requested to be
included in such registration by such Holder and which would be eligible for
inclusion in the registration but for the application of this sentence. In the
event Holders are not permitted to include at least seventy-five (75%) percent
of the shares of Registrable Securities that they requested pursuant to Section
7(b)(i) to be included in a demand registration as a result of the application
of the immediately preceding sentence, such registration shall not be counted as
one of the Holders' demand registrations pursuant to this Section 7(b) and the
Holders shall not be required to reimburse the Company for any expenses incurred
by it in connection with such registration. In the event, as a result of the
second immediately preceding sentence, Holders are permitted to include at least
seventy-five (75%) percent but less than one hundred (100%) percent of the
shares of Registrable Securities that they requested pursuant to Section 7(b)(i)
to be included in any registration which would be the last demand registration
to which the Holders would be entitled pursuant to this Section 7(b) but for the
application of this sentence, the Holders shall be entitled to effect an
additional demand registration in accordance with the provisions set forth in
this Section 7(b) and the Holders shall not be required to reimburse the Company
for any expenses incurred by it in connection with any such additional
registration.

                                       11

<PAGE>

                           (iii) Subject to the last sentences of Sections
7(b)(ii) and (v) hereof, the Company is obligated to effect only two (2)
registrations pursuant to this Section 7(b).

                           (iv) Notwithstanding the foregoing, the Company 
shall not be required to file a registration statement pursuant to a request of
the Initiating Holders during either (i) the one hundred twenty (120) day period
following the effective date of any registration of Company securities which
includes Registrable Securities or Other Securities or (ii) the period of time
beginning on the date the Company files a registration statement with the SEC
covering Other Securities in a firm commitment underwriting and ending on the
earlier to occur of (x) the date which is 120 days after such registration
becomes effective, (y) the date on which the Company withdraws such registration
with the SEC or (z) the date which is 180 days after the date the Company files
such registration statement. In addition, if the Company shall furnish to
Holders requesting a registration statement pursuant to this Section 7(b) a
certificate signed by the President of the Company stating that in the good
faith judgment of the board of directors of the Company it would be seriously
detrimental to the Company and its stockholders for such registration statement
to be filed and it is therefore essential to defer the filing of such
registration statement, the Company shall have the right to defer such filing
for a period of not more than ninety (90) days after receipt of the request of
the Initiating Holders; provided, however, that the Company may not utilize this
right more than once in any twelve (12) month period.

                           (v) VVI acknowledges that the Company has 
granted the Preferred Holders the right to participate in registrations of the
Company's securities required to be undertaken pursuant to this Section 7(b). If
within forty-five (45) days of the exercise of a demand registration right
granted pursuant to this Section 7(b), the Company notifies the Holders of the
Registrable Securities that the Preferred Holders wish to include Other
Securities for their account in such registration, then the Company may include
Other Securities for the account of such Preferred Holders in such registration
and, in the case of an underwritten offering, may reduce the number of shares of
Registrable Securities included in such registration in accordance with the
provisions set forth in Section 7(b)(ii); provided, however, that if the Holders
are not permitted to include at least seventy-five (75%) percent of the shares
of Registrable Securities that they requested pursuant to Section 7(b)(i) to be
included in a demand registration as a result of the applications of this
sentence, such registration shall not be counted as one of Holders' demand
registrations pursuant to this Section 7(b) and the Holders shall not be
required to reimburse the Company for any expenses incurred by it in connection
with such registration. In the event, as a result of the immediately preceding
sentence, Holders are permitted to include at least seventy-five (75%) percent
but less than one hundred (100%) percent of the shares of Registrable Securities
that they requested pursuant to Section 7(b)(i) to be included in any
registration which would be the last demand registration to which the Holders
would be entitled pursuant to this Section 7(b) but for the application of this
sentence, the Holders shall be entitled to effect an additional demand
registration in accordance with the provisions set forth in this Section 7(b)
and the Holders shall not be required to reimburse the Company for any expenses
incurred by it in connection with any such additional registration.

                           (vi) In the event that the Warrant would expire at
any time when the Holders have requested registration of Registrable Securities
pursuant to Section 7(b)(i) and either (x) the Company is not required to file a
registration statement during such time pursuant to Section 7(b)(iv) or (y) the
Holders are not permitted to include all of the Registrable Securities that they
requested to be included in such demand registration pursuant to Section
7(b)(ii) or (v), then

                                       12

<PAGE>

the term of the Warrant (but only with respect to Registrable Securities that
were not included in such demand registration by reason of the circumstances
described in clause (x) or (y)) shall be extended until a registration statement
registering such Registrable Securities is effective.

                  (c) Company Registration. If (but without any obligation to do
so) the Company proposes to register (including for this purpose a registration
effected by the Company for stockholders other than the Holders) any shares of
its Common Stock under the Securities Act in connection with the public offering
of such securities solely for cash (other than a registration relating solely to
the sale of securities to employees pursuant to stock option awards and/or to
participants in a Company employee benefit or stock plan, or a registration on
any form which does not include substantially the same information, other than
information related to the selling stockholders or their plan of distribution,
as would be required to be included in a registration statement covering the
sale of the Registrable Securities), the Company shall, at such time, promptly
give each Holder written notice of such registration. Upon the written request
of each Holder given within twenty (20) days after mailing of such notice by the
Company, the Company shall, subject to the provisions of the immediately
preceding sentence and Section 7(h) hereof, cause to be registered under the
Securities Act all of the Registrable Securities that each such Holder has
requested to be so registered. Notwithstanding anything herein to the contrary,
in the case of a registration required to be undertaken by the Company pursuant
to the Preferred Rights (a "Limited Piggyback Registration"), the Company shall
not be required to include any Registrable Securities in such Limited Piggyback
Registration if either (i) the Preferred Holders (whose determination shall be
made by Preferred Holders holding a majority of the securities covered by such
demand registration rights which are to be included in such registration) or the
managing underwriter (in the case of an underwritten offering) determine in good
faith that the inclusion of any or all of the Registrable Securities would be
detrimental to the offering of the Preferred Holders' securities or any
securities to be sold in such registration for the Company's account or (ii) the
number of Other Securities to be included in such registration would be reduced
by the inclusion of the Registrable Securities in such registration. In the
event the number of shares of Registrable Securities requested by Holders to be
included in a registration is reduced by application of the immediately
preceding sentence, the number of Registrable Securities to be included in the
registration statement shall be allocated among the Holders who have provided
the notice required by this Section 7(c) in proportion (as nearly as
practicable) to the number of Registrable Securities requested to be included in
such registration by such Holder and which would be eligible for inclusion in
such registration but for the application of the immediately preceding sentence.

                  (d) Obligations of the Company. Whenever required under this
Section 7 to effect the registration of any Registrable Securities, the Company
shall, as expeditiously as reasonably possible:

                           (i) Prepare and file with the Securities and 
Exchange Commission (the "SEC") a registration statement with respect to such
Registrable Securities and use its best efforts to cause such registration
statement to become effective, and, upon the request of the Holders of a
majority of the Registrable Securities registered thereunder, keep such
registration statement effective for up to one hundred twenty (120) days.

                           (ii) Prepare and file with the SEC such 
amendments and supplements to such registration statement and the prospectus
used in connection with such registration statement

                                       13

<PAGE>

as may be necessary to comply with the provisions of the Securities Act with
respect to the disposition of all securities covered by such registration
statement.

                           (iii) Furnish to the Holders such numbers of copies
of a prospectus, including a preliminary prospectus, in conformity with the
requirements of the Securities Act, and such other documents as they may
reasonably request in order to facilitate the disposition of Registrable
Securities owned by them.

                           (iv) Use its best efforts to register and qualify
the securities covered by such registration statement under such other
securities or Blue Sky laws of such jurisdictions as shall be reasonably
requested by the Holders, provided that the Company shall not be required to
qualify to do business or to file a general consent to service of process in any
such states or jurisdictions.

                           (v) In the event of any underwritten public 
offering, enter into and perform its obligations under an underwriting
agreement, in usual and customary form, with the managing underwriter of such
offering. Each Holder participating in such underwriting shall also enter into
and perform its obligations under such an agreement.

                           (vi) Notify each Holder of Registrable Securities
covered by such registration statement at any time when a prospectus relating
thereto is required to be delivered under the Securities Act of the happening of
any event as a result of which the prospectus included in such registration
statement, as then in effect, includes an untrue statement of a material fact or
omits to state a material fact required to be stated therein or necessary to
make the statements therein not misleading in the light of the circumstances
then existing.

                           (vii) In the case of an underwritten public offering,
furnish, at the request of any Holder requesting registration of Registrable
Securities pursuant to this Section 7, on the date that such Registrable
Securities are delivered to the underwriters for sale in connection with a
registration pursuant to this Section 7, (A) an opinion, dated such date, of the
counsel representing the Company for the purposes of such registration, in such
form and substance as is customarily given to underwriters in an underwritten
public offering, addressed to the underwriters and (B) a letter dated such date,
from the independent certified public accountants of the Company, in such form
and substance as is customarily given by independent certified public
accountants to underwriters in an underwritten public offering, addressed to the
underwriters.

                  (e) Furnish Information. It shall be a condition precedent to
the obligations of the Company to take any action pursuant to this Section 7
with respect to the Registrable Securities of any selling Holder that such
Holder shall have furnished to the Company such information regarding itself,
the Registrable Securities held by it, and the intended method of disposition of
such securities as shall be required to effect the registration of such Holder's
Registrable Securities.

                  (f) Expenses of Demand Registration. Except as set forth in
this Section 7(f), the Company shall bear and pay all expenses incurred by it in
connection with any registrations, filings or qualifications pursuant to Section
7(b), including without limitation all registration, filing and qualification
fees, printers, and accounting fees, and fees and disbursements of counsel for
the Company; provided, however, that (subject to Sections 7(b)(ii) and (v)
hereof) the Holders participating in any registration pursuant to Section 7(b)
shall reimburse the Company for (i) all

                                       14

<PAGE>

such expenses (up to a maximum of Twenty Five Thousand ($25,000.00) Dollars per
registration) pro rata based upon the number of Registrable Securities included
in such registration by all Holders (excluding, however, any expenses
attributable to the inclusion of any other securities therein, including,
without limitation, any Other Securities) and (ii) for any expenses of any
registration proceeding begun pursuant to Section 7(b) if the registration
request is subsequently withdrawn at the request of the Holders of a majority of
the Registrable Securities to be registered (in which case all Holders
participating in such withdrawn registration shall bear such expenses pro rata
based upon the number of Registrable Securities to be included in such
registration), unless the Holders of a majority of the Registrable Securities
agree to forfeit their right to one demand registration pursuant to Section
7(b); provided further, however, that, in the case of clause (ii) hereof, if at
the time of such withdrawal the Holders have learned of a material adverse
change in the condition, business, or prospects of the Company from that known
to the Holders at the time of their request, then the Holders shall not be
required to reimburse the Company for any of such expenses and shall retain
their rights pursuant to Section 7(b). In no event shall the Company be required
to pay any expenses incurred by a Holder in connection with any registration,
filing or qualification pursuant to Section 7(b).

                  (g) Expenses of Company Registration. The Company shall bear
and pay all expenses incurred by it in connection with any registration, filing
or qualification of Registrable Securities with respect to the registrations
pursuant to Section 7(c), including without limitation all registration, filing,
and qualification fees, printers and accounting fees and all fees and
disbursements of counsel for the Company relating or allocable thereto. The
Company shall not pay any expenses incurred by a Holder in connection with any
such registration, filing or qualification, including, but not limited to
underwriting discounts and commissions relating to Registrable Securities and
the fees and disbursements of any professional advisors (including attorneys and
accountants) utilized by the selling Holders in connection with such
registration, filing or qualification.

                  (h) Reduction of Registrable Securities Included in Piggyback
Registration Statement. In connection with any offering involving an
underwriting of shares being issued by the Company, the Company shall not be
required under Section 7(c) hereof to include any of the Holders' securities in
such underwriting unless they accept the customary and reasonable terms of the
underwriting as agreed upon between the Company and the underwriters selected by
it, and then only in such quantity as will not, in the opinion of the
underwriters, jeopardize the success of the offering by the Company. If the
total amount of securities, including Registrable Securities, requested by
stockholders to be included in such offering exceeds the amount of securities
sold other than by the Company that the underwriters reasonably believe
compatible with the success of the offering, then the Company shall be required
to include in the offering only that number of such securities, including
Registrable Securities, which the underwriters believe will not jeopardize the
success of the offering (the securities so included to be allocated first among
all holders of Other Securities and next apportioned pro rata among the Holders
who have provided notice required by Section 7(c) and all other holders (other
than holders of Other Securities) of securities subject to registration rights
granted by the Company in proportion (as nearly as practicable) to the number of
shares of securities requested to be included in such registration by such
Holder and such other holders and which would have been eligible for inclusion
in such registration but for the application of this sentence, or in such other
proportions as shall mutually be agreed to by such selling stockholders). For
purposes of the provision of the preceding sentence concerning pro rata
apportionment amongst the selling stockholders, for any selling stockholder
which is a partnership

                                       15

<PAGE>

or corporation, the partners, retired partners and stockholders of such Holder,
or the estates and family members of any such partners and retired partners and
any trusts for the benefit of any of the foregoing persons shall be deemed to be
a single "selling stockholder," and any pro rata reduction with respect to such
"selling stockholder" shall be based upon the aggregate amount of shares
carrying registration rights owned by all entities and individuals included in
such "selling stockholder," as defined in this sentence.

                  (i) Delay of Registration. No Holder shall have any right to
obtain or seek an injunction restraining or otherwise delaying any registration
by the Company as the result of any controversy that might arise with respect to
the interpretation or implementation of this Section 7.

                  (j) Indemnification and Contribution. In the event any
Registrable Securities are included pursuant to a registration statement under
this Section 7:

                           (i) To the extent permitted by law, the Company 
will indemnify and hold harmless each Holder, any underwriter (as defined in the
Securities Act) and each person if any, who controls such Holder or underwriter
within the meaning of the Securities Act or the Securities Exchange Act of 1934,
as amended (the "Exchange Act") against any 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 any other federal or state law,
insofar as such losses, claims, damages or liabilities (or actions in respect
thereof) arise out of or are based upon any of the following statements,
omissions or violations (collectively a "Violation"): (A) any untrue statement
or alleged untrue statement of a material fact contained in such registration
statement, including any preliminary prospectus (but only if such is not
corrected in the final prospectus) contained therein or any amendments or
supplements thereto, (B) 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 (but only if such is not corrected in the final
prospectus), or (C) any violation or alleged violation by the Company in
connection with the registration of Registrable Securities under the Securities
Act, the Exchange Act, any state securities law or any rule or regulation
promulgated under the Securities Act, the Exchange Act or any state securities
law; and the Company will pay to each such Holder, underwriter or controlling
person, as incurred, any legal or other expenses reasonably incurred by them in
connection with investigating or defending any such loss, claim, damage,
liability or action; provided, however, that the indemnity agreement contained
in this Section 7(j)(i) shall not apply to amounts paid in settlement of any
such loss, claim, damage, liability or action if such settlement is effected
without the consent of the Company (which consent shall not be unreasonably
withheld), nor shall the Company be liable in any such case for any such loss,
claim, damage, liability or action to the extent that it arises out of or is
based upon a violation which occurs in reliance upon and in conformity with
written information furnished expressly for use in connection with such
registration by any such Holder, underwriter or controlling person.

                           (ii) To the extent permitted by law, each selling
Holder will indemnify and hold harmless the Company, each of its directors, each
of its officers who has signed the registration statement, each person, if any,
who controls the Company within the meaning of the Securities Act, any
underwriter, any other Holder selling securities in such registration statement
and any controlling person of any such underwriter or other Holder, against any
losses, claims, damages or liabilities (joint or several) to which any of the
foregoing persons may become subject, under the Securities Act, the Exchange Act
or other federal or state law, insofar as such losses, claims, damages or
liabilities (or actions in respect thereto) arise out of or are based upon any

                                       16

<PAGE>

Violation, in each case to the extent (and only to the extent) that such
Violation occurs in reliance upon and in conformity with written information
furnished by such Holder expressly for use in con nection with such
registration; and each such Holder will pay, as incurred, any legal or other
expenses reasonably incurred by any person intended to be indemnified pursuant
to this Section 7(j)(ii), in connection with investigating or defending any such
loss, claim, damage, liability or action; provided, however, that the indemnity
agreement contained in this Section 7(j)(ii) shall not apply to amounts paid in
settlement of any such loss, claim, damage, liability or action if such
settlement is effected without the consent of the Holder, which consent shall
not be unreasonably withheld; provided that in no event shall any indemnity
under this Section 7(j)(ii) exceed the net proceeds from the offering received
by such Holder.

                           (iii) Promptly after receipt by an indemnified party
under this Section 7(j) of notice of the commencement of any action (including
any governmental action), such indemnified party will, if a claim in respect
thereof is to be made against any indemnifying party under this Section 7(j),
deliver to the indemnifying party a written notice of the commencement thereof
and the indemnifying party shall have the right to participate in, and, to the
extent the indemnifying party so desires, jointly with any other indemnifying
party similarly noticed, to assume the defense thereof with counsel mutually
satisfactory to the parties; provided, however, that an indemnified party shall
have the right to retain its own counsel, with the fees and expenses to be paid
by the indemnifying party, if representation of such indemnified party by the
counsel retained by the indemnifying party would be inappropriate due to actual
or potential differing interests between such indemnified party and any other
party represented by such counsel in such proceeding. The failure to deliver
written notice to the indemnifying party within a reasonable time of the
commencement of any such action, if prejudicial to its ability to defend such
action, shall relieve such indemnifying party of any liability to the
indemnified party under this Section 7(j), but the omission so to deliver
written notice to the indemnifying party will not relieve it of any liability
that it may have to any indemnified party otherwise than under this Section
7(j).

                           (iv) In order to provide for just and equitable 
contribution in circumstances in which the indemnification provided for in
Section 7(j)(i) and (ii) is applicable but for any reason is held to be
unavailable from the Company with respect to all Holders or any Holder, the
Company and the Holder or Holders, as the case may be, shall contribute to the
aggregate losses, claims, damages and liabilities (including any investigation,
legal and other expenses incurred in connection with, and any amount paid in
settlement of, any action, suit or proceeding or any claims asserted) to which
the Company and one or more of the Holders may be subject in such proportion as
is appropriate to reflect the relative fault of the Company on the one hand, and
the Holder or Holders on the other, in connection with statements or omissions
which resulted in such losses, claims, damages or liabilities. Notwithstanding
the foregoing, no Holder shall be required to contribute any amount in excess of
the net proceeds received by such Holder from the Registrable Securities as the
case may be, sold by such Holder pursuant to the registration statement. 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. Each person, if any,
who controls a Holder within the meaning of the Securities Act shall have the
same rights to contribution as such Holder.

                           (v) The obligations of the Company and Holders 
under this Section 7(j) shall survive the completion of any offering of
Registrable Securities in a registration statement under this Section 7 or
otherwise.

                                       17

<PAGE>

                  (k) Reports Under the Exchange Act. With a view to making
available to the Holders the benefits of Rule 144 promulgated under the
Securities Act and any other rule or regulation of the SEC that may at any time
permit a Holder to sell securities of the Company to the public without
registration or pursuant to a registration on Form S-3, the Company agrees to:

                           (i) make and keep public information available, 
as those terms are understood and defined in Rule 144 of the SEC;

                           (ii) at all times take all such action as may be 
necessary or advisable to enable the Holders to utilize Form S-3 for the sale of
their Registrable Securities;

                           (iii) file with the SEC in a timely manner all
reports and other documents required of the Company under the Securities Act and
the Exchange Act; and

                           (iv) furnish to any Holder, so long as the Holder
owns any Registrable Securities, forthwith upon its request (i) a written
statement by the Company as to its compliance with the reporting requirements of
SEC Rule 144, the Securities Act and the Exchange Act, or as to its qualified
status as a registrant whose securities may be resold pursuant to Form S-3, (ii)
a copy of the most recent annual or quarterly report of the Company and such
other reports and documents so filed by the Company, and (iii) such other
information as may be reasonably requested in availing any Holder of any rule or
regulation of the SEC which permits the selling of any such securities without
registration or pursuant to such form.

                  (1) Limitations on Subsequent Registration Rights. From and
after the date of this Agreement, the Company shall not, without the prior
written consent of the Holders of a majority of the outstanding Registrable
Securities, enter into any agreement with any holder or prospective holder of
any securities of the Company which would allow such holder or prospective
holder (i) to include such securities in any registration filed under Section
7(b) hereof, unless under the terms of such agreement, such holder or
prospective holder may include such securities in any such registration only to
the extent that the inclusion of this securities will not reduce the amount of
the Registrable Securities of the Holders which is included in such
registration; (ii) to make a demand registration which could result in such
registration statement being declared effective within one hundred twenty (120)
days after the effective date of any registration effected pursuant to Section
7(b) hereof or (iii) to include such securities in any registration in which the
Holders may include Registrable Securities pursuant to Section 7(c) hereof,
unless under the terms of such agreement, such holder or prospective holder may
include such securities in any such registration only on a basis no more
favorable than pro rata with all Holders of Registrable Securities in proportion
(as nearly as practicable) to the number of shares of securities to be included
in such registration by such Holder and such other holders.

                  (m) The provisions of this Section 7 shall survive any
expiration of the Warrants evidenced hereby until the earlier to occur of (i)
the date that all Warrant Shares held by all Holders may be sold for resale
pursuant to Rule 144 under the Exchange Act without reduction as a result of
Rule 144(e) thereunder and (ii) the date that no Warrants or Warrant Shares are
held by any Holder.

SECTION 8.  Miscellaneous.


                                       18

<PAGE>

         8.1 Entire Agreement. This Warrant constitutes the entire agreement
between the Company and the Warrantholders with respect to this Warrant and
Warrant Shares.

         8.2 Binding Effects; Benefits. This Warrant shall inure to the benefit
of and shall be binding upon the Company, the Warrantholders and holders of
Warrant Shares and their respective heirs, legal representatives, successors and
assigns. Nothing in this Warrant, expressed or implied, is intended to or shall
confer on any person other than the Company, the Warrantholders and holders of
Warrant Shares, or their respective heirs, legal representatives, successors or
assigns, any rights, remedies, obligations or liabilities under or by reason of
this Warrant or the Warrant Shares.

         8.3 Amendments and Waivers. This Warrant may not be modified or amended
except by an instrument in writing signed by the Company and Warrantholders that
hold Warrants entitling them to purchase at least 50% of the Warrant Shares. The
Company, any Warrantholder or holders of Warrant Shares may, by an instrument in
writing, waive compliance by the other party with any term or provision of this
Warrant on the part of such other party hereto to be performed or complied with.
The waiver by any such party of a breach of any term or provision of this
Warrant shall not be construed as a waiver of any subsequent breach.

         8.4 Section and Other Headings. The section and other headings
contained in this Warrant are for reference purposes only and shall not be
deemed to be a part of this Warrant or to affect the meaning or interpretation
of this Warrant.

         8.5 Further Assurances. Each of the Company, the Warrantholders and
holders of Warrant Shares shall do and perform all such further acts and things
(including, without limitation, any required filings under the Hart-Scott-Rodino
Antitrust Improvements Act of 1976, as amended) and execute and deliver all such
other certificates, instruments and/or documents (including without limitation,
such proxies and/or powers of attorney as may be necessary or appropriate) as
any party hereto may, at any time and from time to time, reasonably request in
connection with the performance of any of the provisions of this Warrant.

         8.6 Notices. All demands, requests, notices and other communications
required or permitted to be given under this Warrant shall be in writing and
shall be deemed to have been duly given if delivered personally or sent by
United States certified or registered first class mail, postage prepaid, to the
parties hereto at the following addresses or at such other address as any party
hereto shall hereafter specify by notice to the other party hereto:

                  (a)      if to the Company, addressed to:

                           National Media Corporation
                           Eleven Penn Center
                           1835 Market Street, Suite 1100
                           Philadelphia, Pennsylvania 19103
                           Attention: General Counsel

                  (b) if to any Warrantholder or holder of Warrant Shares,
addressed to the address of such person appearing on the books of the Company.


                                       19

<PAGE>

                  Except as otherwise provided herein, all such demands,
requests, notices and other communications shall be deemed to have been received
on the date of personal delivery thereof or on the third business day after the
mailing thereof.

         8.7 Separability. Any term or provision of this Warrant which is
invalid or unenforceable in any jurisdiction shall, as to such jurisdiction, be
ineffective to the extent of such invalidity or unenforceability without
rendering invalid or unenforceable any other term or provision of this Warrant
or affecting the validity or enforceability of any of the terms or provisions of
this Warrant in any other jurisdiction.

         8.8 Fractional Shares. No fractional shares or scrip representing
fractional shares shall be issued upon the exercise of this Warrant. With
respect to any fraction of a share called for upon any exercise hereof, the
Company shall pay to the Warrantholder an amount in cash equal to such fraction
multiplied by the current market price (as determined as of the date of
exercise, and with reference to the applicable trading market, in accordance
with Section 1.l(a)(ii)) of a share of such stock as of the date of such
exercise.

         8.9 Rights of the Holder. The Warrantholder shall not, solely by virtue
of this Warrant, be entitled to any rights of a stockholder of the Company,
either at law or in equity.

         8.10 Governing Law. This Warrant shall be deemed to be a contract made
under the laws of the State of Delaware and for all purposes shall be governed
by and construed in accordance with the laws of such State applicable to
contracts made and performed in Delaware.


                                       20

<PAGE>

         IN WITNESS WHEREOF, the Company has caused this Warrant to be signed by
its duly authorized officer.

                                   NATIONAL MEDIA CORPORATION




                                   By:
                                      -------------------------------------
                                      Name:
                                      Title:


Dated September __, 1998

                                       21

<PAGE>

                                   ASSIGNMENT


(To be executed only upon assignment of Warrant Certificate)

                  For value received, _________________ hereby sells, assigns
and transfers unto ___________________ the within Warrant Certificate, together
with all right, title and interest therein, and does hereby irrevocably
constitute and appoint ______________________ attorney, to transfer said Warrant
Certificate on the books of the within-named Company with respect to the number
of Warrants set forth below, with full power of substitution in the premises:

<TABLE>
<CAPTION>

         Name(s) of
         Assignee(s)                Address                            No. of Warrant Shares
         -----------                -------                            ---------------------
      <S>                        <C>                                <C>

</TABLE>






And if said number of Warrants shall not be all the Warrants represented by the
Warrant Certificate, a new Warrant Certificate is to be issued in the name of
said undersigned for the balance remaining of the Warrants represented by said
Warrant Certificate.

Dated:  _______________, 19 __



                                 -----------------------------------------------
                                 Note:    The above signature should correspond 
                                          exactly with the name on the face of 
                                          this Warrant Certificate.

                                       22

<PAGE>

                                SUBSCRIPTION FORM
                    (To be executed upon exercise of Warrant
                           pursuant to Section 1.1(a))

                  The undersigned hereby irrevocably elects to exercise the
right of purchase represented by the within Warrant Certificate for, and to
purchase thereunder, ________ shares of Common Stock, as provided for therein,
and delivers payment in full of the Exercise Price in the amount of $________ as
follows:
<TABLE>
<CAPTION>

             <S>                                                  <C>
                  Cash                                                 $
                                                                        -----------
                  Certified or Official bank check                     $
                                                                        -----------
                  Application of Telemarketing Differential
                      and Production and Post Production
                      Differential                                     $
                                                                        -----------
</TABLE>

                  Please issue a certificate or certificates for such Common
Stock in the name of, and pay any cash for any fractional share to:

                               Name:
                                    ------------------------------------------
                            Address:
                                    ------------------------------------------

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

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

                Social Security No.:
                                    ------------------------------------------
                  (Please Print Name, Address and Social Security No.)

                          Signature:
                                    ------------------------------------------
                                    NOTE: The above signature should 
                                          correspond exactly with the name on 
                                          the first page of this Warrant 
                                          Certificate or with the name of the 
                                          assignee appearing in the 
                                          assignment form delivered herewith.

                  And if said number of shares shall not be all the shares
purchasable under the within Warrant Certificate, a new Warrant Certificate is
to be issued in the name of said undersigned for the balance remaining of the
shares purchasable thereunder rounded up to the next higher number of shares.


                                       23


<PAGE>



                                                                    EXHIBIT 23.1


<PAGE>

                         Consent of Independent Auditors


We consent to the reference to our firm under the caption "Experts" in the
Registration Statement (Form S-3) and related Prospectus of National Media
Corporation for the registration of 4,318,579 shares of its common stock and to
the incorporation by reference therein of our report dated June 29, 1998 with
respect to the consolidated financial statements and schedule of National Media
Corporation included in its Annual Report (Form 10-K) for the year ended March
31, 1998, filed with the Securities and Exchange Commission.

/s/ Ernst & Young LLP

Philadelphia, Pennsylvania
September 24, 1998






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