MEDIALINK WORLDWIDE INC, S-1/A, 1996-10-31

MEDIALINK WORLDWIDE INC
S-1/A, 1996-10-31
COMMUNICATIONS SERVICES, NEC

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<PAGE>

AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON OCTOBER 31, 1996

REGISTRATION NO. 333-14119

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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
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PRE-EFFECTIVE
AMENDMENT NO. 1
TO
FORM S-1
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933

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MEDIALINK WORLDWIDE INCORPORATED
(EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)

DELAWARE 52-1481284
(STATE OR OTHER JURISDICTION OF (I.R.S. EMPLOYEE
INCORPORATION OR ORGANIZATION) IDENTIFICATION NO.)

4899
(PRIMARY STANDARD INDUSTRIAL CLASSIFICATION CODE NUMBER)

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708 THIRD AVENUE
NEW YORK, NY 10017
(212) 682-8300
(ADDRESS, INCLUDING ZIP CODE, AND TELEPHONE NUMBER,
INCLUDING AREA CODE, OF REGISTRANT'S PRINCIPAL EXECUTIVE OFFICES)

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LAURENCE MOSKOWITZ
PRESIDENT AND CHIEF EXECUTIVE OFFICER
MEDIALINK WORLDWIDE INCORPORATED
708 THIRD AVENUE
NEW YORK, NY 10017
(212) 682-8300
(NAME, ADDRESS, INCLUDING ZIP CODE, AND TELEPHONE NUMBER,
INCLUDING AREA CODE, OF AGENT FOR SERVICE)

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

Copies to:

THEODORE WM. TASHLIK, ESQ. WILLIAM N. DYE, ESQ.
MARTIN M. GOLDWYN, ESQ. WILLKIE FARR & GALLAGHER
TASHLIK, KREUTZER & GOLDWYN P.C. ONE CITICORP CENTER
833 NORTHERN BOULEVARD 153 EAST 53RD STREET
GREAT NECK, NY 11021 NEW YORK, NY 10022
(516) 466-8005 (212) 821-8000

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

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

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

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

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

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

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

SUBJECT TO COMPLETION
Dated October 31, 1996

2,000,000 SHARES
[LOGO]
COMMON STOCK

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All of the 2,000,000 shares being offered hereby are being sold by Medialink
Worldwide Incorporated ('Medialink' or the 'Company'). Up to 300,000
additional shares may be sold by certain of the Company's stockholders
(the 'Selling Stockholders') in the event that the Underwriters
exercise their over-allotment option. The Company will not
receive any proceeds from the sale of shares by the Selling
Stockholders. See 'Principal and Selling Stockholders.'

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Prior to the offering, there has been no public market for the Common Stock. It
is currently estimated that the initial public offering price will be between
$9.00 and $11.00 per share. See 'Underwriting.' Application has been
made to have the Common Stock approved for quotation on the Nasdaq
National Market under the symbol 'MDLK.'

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

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

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UNDERWRITING
PRICE TO DISCOUNTS AND PROCEEDS TO
PUBLIC COMMISSIONS(1) COMPANY(2)
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PER SHARE $ $ $

TOTAL(3) $ $ $
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(1) The Company and the Selling Stockholders have agreed to indemnify the
Underwriters against certain liabilities, including liabilities under the
Securities Act of 1933, as amended. See 'Underwriting.'

(2) Before deduction of expenses payable by the Company estimated at $ .

(3) The Selling Stockholders have granted the several Underwriters a 30-day
option to purchase up to an additional 300,000 shares of Common Stock solely
to cover over-allotments, if any. If such option is exercised in full, the
total price to public, underwriting discounts and commissions and proceeds
to the Selling Stockholders will be $ , $ and $ ,
respectively. The proceeds to the Company will not change from the amount
set forth above. See 'Underwriting.'

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The Common Stock is being offered by the Underwriters named herein when, as
and if received and accepted by them, subject to their right to reject orders in
whole or in part and subject to certain other conditions. It is expected that
delivery of the shares will be made in New York, New York on or about
, 1996.

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DEAN WITTER REYNOLDS INC. WHEAT FIRST BUTCHER SINGER

, 1996

<PAGE>
Tap the Power of photo of person
videotaping

GLOBAL MEDIA

photo of
computer screen

We broadcast the stories
and project the images
that make the news on
television and radio, in the
workplace and in the home.
VIDEO NEWS RELEASES SATELLITE MEDIA
TOURS reaching Television Viewers

AUDIO NEWS RELEASES RADIO MEDIA
TOURS reaching Radio Listeners

VIDEO CONFERENCES LIVE BROADCASTS
reaching Internal Audiences

PUBLIC RELATIONS RESEARCH PRESS CLIPPING
ANALYSIS proving the Value of
Communications

PRESS RELEASE DISTRIBUTION reaching
Trade and Newspaper Readers

AUDIO/VIDEO VIA THE INTERNET reaching
On-line Newsrooms and the Public

photo of satellite
|
|
photo of hand at electronic board
|
|-------------------------------
| photo of a newscaster |
| |
- ----------------------------------------------------
photo of | photo of person in | photo of |
globe | control room | |
| | persons |
| | |
- -------------------------------------| hand on a |----------------------------
photo of audio photo of | MEDIALINK |
broadcaster globe radio knob | |
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| |
| Worldwide Communications Solutions |
------------------------------------------

HEADQUARTERS
New York

OFFICES
London
Atlanta
Chicago
Dallas
Los Angeles
Norwalk, CT
Washington

AFFILIATES
Brussels
Dubai
Geneva
Hamburg
Hong Kong
Johannesburg
Madrid
Melbourne
Oslo
Paris
Rome
San Juan/Miami
Seoul
Stockholm
Tel Aviv
Tokyo
Toronto

IN CONNECTION WITH THIS OFFERING, THE UNDERWRITERS MAY OVER-ALLOT OR EFFECT
TRANSACTIONS WHICH MAY STABILIZE OR MAINTAIN THE MARKET PRICE OF THE COMMON
STOCK AT A LEVEL ABOVE THAT WHICH MIGHT OTHERWISE PREVAIL IN THE OPEN MARKET.
SUCH TRANSACTIONS MAY BE EFFECTED ON THE NASDAQ NATIONAL MARKET OR OTHERWISE.
SUCH STABILIZING, IF COMMENCED, MAY BE DISCONTINUED AT ANY TIME.

<PAGE>
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NO DEALER, SALESPERSON OR OTHER PERSON HAS BEEN AUTHORIZED TO GIVE ANY
INFORMATION OR TO MAKE ANY REPRESENTATIONS NOT CONTAINED IN THIS PROSPECTUS IN
CONNECTION WITH THE OFFER CONTAINED HEREIN AND, IF GIVEN OR MADE, SUCH
INFORMATION OR REPRESENTATION MUST NOT BE RELIED UPON AS HAVING BEEN AUTHORIZED
BY THE COMPANY OR ANY UNDERWRITER. NEITHER THE DELIVERY OF THIS PROSPECTUS NOR
ANY SALE MADE HEREUNDER SHALL, UNDER ANY CIRCUMSTANCES, CREATE ANY IMPLICATION
THAT THERE HAS BEEN NO CHANGE IN THE AFFAIRS OF THE COMPANY SINCE THE DATE
HEREOF OR SINCE THE DATES AS OF WHICH INFORMATION IS SET FORTH HEREIN. THIS
PROSPECTUS DOES NOT 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 IN SUCH JURISDICTION.

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TABLE OF CONTENTS

<TABLE>
<CAPTION>
PAGE
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<S> <C>
Prospectus Summary............................. 4
Risk Factors................................... 7
Use of Proceeds................................ 12
Dividend Policy................................ 12
Dilution....................................... 13
Capitalization................................. 14
Selected Financial Information................. 15
Management's Discussion and Analysis of
Financial Condition and Results of
Operations................................... 16

<CAPTION>
PAGE
----
<S> <C>
Business....................................... 21
Management..................................... 33
Certain Transactions........................... 39
Principal and Selling Stockholders............. 40
Description of Capital Stock................... 42
Shares Eligible for Future Sale................ 45
Underwriting................................... 46
Legal Matters.................................. 47
Experts........................................ 47
Additional Information......................... 47
Index to Financial Statements.................. F-1
</TABLE>

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UNTIL , 1996 (25 DAYS AFTER THE DATE OF THIS PROSPECTUS) ALL
DEALERS EFFECTING TRANSACTIONS IN THE COMMON STOCK, WHETHER OR NOT PARTICIPATING
IN THIS DISTRIBUTION, MAY BE REQUIRED TO DELIVER A PROSPECTUS. THIS IS IN
ADDITION TO THE OBLIGATION OF DEALERS TO DELIVER A PROSPECTUS WHEN ACTING AS
UNDERWRITERS AND WITH RESPECT TO THEIR UNSOLD ALLOTMENTS OR SUBSCRIPTIONS.

<PAGE>
PROSPECTUS SUMMARY

The following summary is qualified in its entirety by reference to the more
detailed information and the Consolidated Financial Statements and Notes thereto
appearing elsewhere in this Prospectus.

THE COMPANY

Medialink is a leading worldwide provider of video and audio production and
distribution services for businesses and other organizations seeking to
communicate their news through television, radio and other media. The Company's
principal services are based on its core business -- satellite distribution of
video news releases (VNRs) and the electronic monitoring of their broadcast on
television. A VNR is the video equivalent of a conventional press release and is
used for the same purposes, such as to introduce a new product or service,
explain a technological breakthrough, communicate during a crisis or advocate a
position on an issue of public concern. VNRs are produced for easy integration
into newscasts and are distributed to the media for their use in complete or
edited form. The Company began offering video production services in 1994 and
has since developed a full range of video, audio and print services which it now
provides on a global basis. Services introduced since 1994 accounted for
approximately 27% of revenues for the nine months ended September 30, 1996.
Medialink enables its clients to reach more than 3,000 newsrooms at television
and radio networks, local stations, cable channels, direct broadcast satellite
systems, as well as on-line services, including those available on the Internet.

The Company has provided its services to more than 1,100 clients over the
last twenty-four months. The Company's clients include corporations such as
General Motors, IBM, Johnson & Johnson, Sony and Ciba Geigy/Sandoz;
organizations such as the American Association of Retired Persons and the
AFL-CIO; and the world's largest marketing communications firms such as
Burson-Marsteller, Hill & Knowlton, Edelman Public Relations Worldwide and the
Shandwick Group. No single client accounted for more than 4% of the Company's
revenues in 1995. Materials distributed by the Company have aired on ABC, CBS,
NBC and their affiliates, as well as CNN and CNBC in the United States, and the
BBC, CNN International, Sky News, RAI (Italy) and NHK (Japan) internationally.

Organizations that conduct public relations campaigns, including most
marketing communications agencies, do not generally find it cost-effective to
maintain the facilities and personnel necessary to produce material suitable for
use on news broadcasts and distribute it to the media, especially on a global
basis. As a result, it is often more economical to outsource such services from
a specialist firm such as the Company, which can provide the necessary talent
and production, distribution and monitoring facilities. While the Company serves
a global marketplace, it believes that the North American and United Kingdom
markets for its services total approximately $500 million.

Medialink's competitive advantages include its extensive operating history
with media outlets, key industry relationships, prominent client base,
combination of professional skills, ability to integrate new technology and
worldwide distribution and production capabilities. The Company has an exclusive

agreement with the Associated Press (the 'AP') to use the AP's dedicated links
to notify U.S. television and radio newsrooms of upcoming satellite
transmissions. The Company has agreements with the AP and ABC Radio Networks
Inc. ('ABC Radio') for satellite transmission of audio services to radio
stations in the U.S. The Company also has an agreement with Nielsen Media
Research and uses Competitive Media Reporting to monitor domestic television
station usage of video services. Internationally, the Company has a network of
17 affiliates in Europe, Latin America, South Africa, Asia and the Pacific Rim.
International revenues increased approximately 317% from $360,000 in 1993 to
$1.5 million in 1995.

The Company plans to expand its business by (i) developing new services;
(ii) leveraging its client relationships by cross-marketing services to its
clients; (iii) continuing its global expansion; and (iv) pursuing acquisitions
and strategic alliances with other companies that can add to the Company's
service capabilities or geographic scope. In July 1996 the Company, through its
wholly owned subsidiary Medialink PR Data Corporation ('Medialink PR Data'),
acquired certain assets of PR Data Systems, Inc. (the 'PR Data Acquisition') to
expand its research capabilities and to add print news release distribution
services.

<PAGE>
THE OFFERING

Common Stock offered by the Company........ 2,000,000 shares
Common Stock to be outstanding after....... 5,047,933 shares(1)
the Offering
Use of Proceeds............................ For general corporate purposes
and possible acquisitions. See
'Use of Proceeds.'
Nasdaq National Market symbol.............. MDLK

SUMMARY FINANCIAL INFORMATION
(IN THOUSANDS, EXCEPT PER SHARE AND OTHER DATA)

<TABLE>
<CAPTION>
NINE MONTHS ENDED
YEARS ENDED DECEMBER 31, SEPTEMBER 30,
----------------------------------------------------------------- ---------------------------------
1991 1992 1993 1994 1995 1995 1996
-------- -------- -------- -------- --------------------- --------- ---------------------
PRO PRO
ACTUAL FORMA(2) ACTUAL ACTUAL FORMA(2)
--------- --------- --------- --------- ---------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
STATEMENT OF OPERATIONS DATA:
Revenues................... $ 4,891 $ 5,802 $ 6,065 $ 7,548 $ 10,625 $ 12,237 $ 7,382 $ 11,158 $ 12,014
Gross profit............... 3,024 3,577 3,435 4,509 6,071 7,492 4,100 6,553 7,318
Operating income (loss).... 87 140 (215) 440 698 705 303 1,005 1,011
Net income (loss).......... $ 21(3) $ 144(3)$ (231) $ 1,464(4)$ 381 $ 374 $ 166 $ 579 $ 567
Net income (loss) before
tax valuation
reversal(4).............. $ 21(3) $ 144(3) $ (231) $ 222(4) $ 381 $ 374 $ 166 $ 579 $ 567
Pro forma net income per
share(5)................. $ 0.11 $ 0.05 $ 0.17
Shares used to compute pro
forma net income per
share(5)................. 3,453 3,453 3,485
OTHER DATA:
Number of offices.......... 4 4 5 6 7 8 7 8 8
Average revenues per sales
employee................. $326,000 $322,000 $347,000 $414,000 $ 506,000 $532,000
</TABLE>

SEPTEMBER 30, 1996
---------------------------
ACTUAL AS ADJUSTED(6)
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BALANCE SHEET DATA:
Working capital............................... $1,500 $19,400
Total assets.................................. 6,551 24,451
Long-term debt, net of current portion........ 284 284
Stockholders' equity.......................... 3,173 21,073

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(1) Does not include an aggregate of (i) 569,594 shares of Common Stock issuable
upon exercise of options outstanding under the Company's Amended and
Restated Stock Option Plan ('Stock Option Plan') and (ii) 62,400 shares of
Common Stock reserved for issuance upon exercise of options outstanding
under the 1996 Directors Stock Option Plan ('Directors Stock Option Plan').

(2) Gives effect to PR Data Acquisition as if the transaction occurred at the
beginning of the period presented. The Company paid for the PR Data
Acquisition through the payment of $120,000 cash, the issuance of 24,000
shares of Common Stock and the assumption of certain liabilities not to
exceed the book value of the assets acquired by $372,000. The pro forma
financial information is not necessarily indicative of the operating results
which would have been achieved had the acquisition occurred at the beginning
of the period presented or the results to be achieved in the future.

(3) Includes a loss of $40,000 from discontinued operations in 1991 and the
utilization of net operating losses resulting in tax benefits of $12,000 in
1991 and $49,000 in 1992.

(4) In accordance with Statement of Financial Accounting Standards No. 109, the
Company reversed its valuation allowance against deferred tax assets in the
amount of $1,242,000 in 1994. See Note 5 to the Company's Financial
Statements.

(5) See Note 9 to the Company's Financial Statements for an explanation of the
method used to determine the number of shares.

(6) Gives effect to the offering of 2,000,000 shares of Common Stock (at an
assumed price of $10.00 per share) and the estimated net proceeds of $17.9
million, as if the offering occurred on September 30, 1996.

5
<PAGE>
Medialink is headquartered in New York and maintains offices in Washington,
D.C., Chicago, Dallas, Los Angeles, Atlanta and Norwalk, Connecticut. Its
international activities are coordinated from its London office. Medialink was
incorporated under the laws of the State of Delaware in 1986. The Company

maintains its principal offices at 708 Third Avenue, New York, New York 10017.
The Company's telephone number is 212-682-8300. The Company's Internet address
is www.medialinkworldwide.com. Information contained in the Company's World Wide
Web ('Web') site shall not be deemed part of this Prospectus.

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

Unless otherwise indicated, all information in this Prospectus (i) assumes
no exercise of the Underwriters' over-allotment option, (ii) reflects a 1.2 for
1 stock split of the Common Stock effected in the form of a stock dividend on
July 31, 1996 and (iii) gives effect to the automatic conversion of all
outstanding shares of Series A, Series B and Series C Preferred Stock into an
aggregate of 2,111,669 shares of Common Stock to be effective upon the closing
of this offering (the 'Preferred Stock Conversions'). See 'Description of
Capital Stock.' Medialink is a service mark of the Company.

<PAGE>
RISK FACTORS

An investment in the shares of Common Stock offered hereby involves a high
degree of risk. The following factors, in addition to the other information in
this Prospectus, should be carefully considered in evaluating the Company and
its business before purchasing the shares of Common Stock offered hereby. This
Prospectus contains forward-looking statements which involve risks and
uncertainties. The Company's actual results in the future could differ
significantly from the results discussed in such forward-looking statements.
Factors that could cause or contribute to such a difference include, but are not
limited to, those discussed in 'Risk Factors' below, 'Management's Discussion
and Analysis of Financial Condition and Results of Operations' and 'Business,'
as well as those discussed elsewhere in this Prospectus.

FLUCTUATIONS IN QUARTERLY OPERATING RESULTS; SEASONALITY OF BUSINESS

The Company experiences quarterly seasonal variations in revenues as a
result of many factors, including its clients' business cycles and timing of
product introductions. As a result, the Company's revenues are typically lower
during the first and third quarters of the Company's fiscal year. The Company
expects this seasonality to continue in the future. In addition, other factors
that may cause the Company's quarterly results to fluctuate include timing of
the completion, material reduction or cancellation of projects or timing of the
receipt of new business, timing of the hiring or loss of sales personnel, the
relative profit mix of projects, strategic pricing decisions of the Company and
costs relating to the expansion of operations and other factors. Events which
dominate news broadcasts may cause the Company's clients to delay their use of,
or not use, the Company's services for a particular project as such clients may
determine that their messages may not receive adequate attention in light of the
coverage of other news events. Such circumstances could have a material adverse
effect on the Company's business, operating results and financial condition. See
'Management's Discussion and Analysis of Financial Condition and Results of
Operations.'

DEPENDENCE ON KEY PERSONNEL

The Company's success depends to a significant degree upon the continuing
contributions of, and on its ability to attract and retain, qualified management
and sales, operations, marketing and technical personnel. In particular, the
loss of the services of its founders, Laurence Moskowitz, the Company's Chairman
of the Board, President and Chief Executive Officer, or J. Graeme McWhirter, its
Executive Vice President and Chief Financial Officer, could have a material
adverse effect upon the Company. There can be no assurance that an adequate
replacement could be found if the Company were to lose the services of Mr.
Moskowitz or Mr. McWhirter. There can be no assurance that the Company will be
able to continue to attract and retain qualified management and sales,
operations, marketing and technical personnel in the future. The Company's
failure to attract and retain key personnel would have a material adverse effect
on its business, operating results and financial condition. The Company is the
beneficiary of a $1.25 million key man life insurance policy on the life of
Laurence Moskowitz. The Company has entered into employment agreements with its
executive officers which will become effective upon the consummation of this

offering. See 'Management.'

DEPENDENCE ON CERTAIN SUPPLIERS

The Company has an exclusive agreement with the AP for the operation of the
AP Express/Medialink Newswire serving approximately 740 television stations
across the U.S. The Company believes that its agreement with the AP gives it a
competitive advantage because of this ability to notify television stations of
upcoming video transmissions, and the termination of such agreement could have a
material adverse effect on the Company's business, operating results and
financial condition. The Company's agreement with the AP expires in November
1997 and the Company is currently negotiating an extension of such agreement.
There can be no assurance that such agreement will be extended, or if extended,
on terms favorable to the Company. The Company also has an agreement with
Nielsen Media Research and uses Competitive Media Reporting for electronic
monitoring of video television broadcasts. In addition, the Company has
agreements with the AP and ABC Radio for satellite transmissions of audio
services to radio stations in the U.S. The termination of any of these services
could have a material adverse effect on the Company's business, operating
results and financial condition. The Company benefits from favorable volume
pricing agreements with certain suppliers for satellite transmission services.
The inability in the future to obtain sufficient supply or service from these
and other vendors, or to develop alternative sources, could result in price
increases, delays or reductions in services which could have a material adverse
effect on the Company's business, operating results and financial condition.

7
<PAGE>
The Company's ability to distribute material to media outlets in accordance
with its clients' requirements depends on a number of factors. Some of these
factors are outside of the Company's control, including equipment failure and
interruption in services by its telecommunications service providers. The
Company's failure to make timely distributions could have a material adverse
effect on the Company's business, operating results and financial condition. The
Company has experienced increases in satellite transmission costs during the
past two years. The inability or unwillingness of the Company to pass such cost
increases to its clients could have a material adverse effect on the Company's
business, operating results and financial condition.

DEPENDENCE ON VIDEO NEWS RELEASES

A substantial portion of the Company's revenues to date has been derived
from the production, distribution and monitoring of VNRs in the U.S. and
overseas. A decline in demand for, or reduction in average prices charged by the
Company for, VNR services, whether as a result of competition, technological
change or otherwise, would have a material adverse effect on the Company's
business, operating results and financial condition. Additionally, the Company
is dependent upon the willingness of the media outlets to which it supplies VNRs
to actually use them on their news broadcasts. Should these media outlets reduce
the use of VNRs, there would be a material adverse effect on the Company's
business, operating results and financial condition. See 'Management's
Discussion and Analysis of Financial Condition and Results of Operations' and
'Business.'

DEPENDENCE ON NEW SERVICES FOR GROWTH

The Company believes that its growth will depend, in part, on its ability
to effectively market recently introduced services and to develop new services
in a timely and cost-effective manner. There can be no assurance that the
Company will be successful in marketing and developing these recently introduced
services or other new services or that if such development is completed, the
Company's planned introduction of these services will realize market acceptance
or will meet the technical or other requirements of its clients. If the Company
is unable to effectively market new services, there could be a material adverse
effect on the Company's business, operating results and financial condition. See
'Business.'

RISKS ASSOCIATED WITH ACQUISITIONS

The Company's growth strategy includes pursuing acquisitions in the
communications services industry. The success of this strategy depends not only
upon the Company's ability to identify and acquire suitable businesses on a
cost-effective basis, but also upon its ability to integrate acquired personnel,
operations, products, services and technology into its organization effectively,
to retain and motivate key personnel and to retain the clients of acquired
firms. There can be no assurance that the Company will be able to achieve any of
the foregoing. The Company competes for acquisition opportunities with other
companies that have significantly greater financial and other resources than
those of the Company. The Company may use Common Stock and/or Preferred Stock
(which could result in dilution to the purchasers of the Common Stock offered
hereby) or may incur long-term indebtedness or a combination thereof for all or
a portion of the consideration to be paid in future acquisitions. The Company
has no current plans, agreements or commitments and is not currently engaged in
any negotiations with respect to any acquisitions.

GLOBAL EXPANSION

The Company plans to continue its international expansion through direct
operations and foreign affiliations. There can be no assurance, however, that
the Company's services will achieve market acceptance in other countries. The
Company's ability to successfully enter these new markets will depend, in part,
on its ability to attract personnel with experience in these locations and to
attract partners with the necessary local business relationships. Changes in
government policies and regulations in foreign countries could require the
Company's services to be redesigned or could restrict the Company's ability to
deliver its material. Telecommunications standards in foreign countries differ
from those in the U.S. and may require the Company to incur substantial costs
and expend significant managerial resources to comply with such standards.
Furthermore, international business is subject to country-specific risks and
circumstances, including different tax laws, difficulties in expatriating
profits, currency exchange rate fluctuations, increases in duties, price
controls and the complexities of administering business abroad. These and other
related risks and circumstances could have a material adverse effect on the
Company's business, operating results and financial condition.

8
<PAGE>

ABILITY TO INTEGRATE NEW TECHNOLOGY

The communications industry is characterized by rapidly changing
technology. The Company's ability to remain competitive will depend in
significant part upon its ability to continue to integrate new technology into
its services. New technologies, as well as the introduction of services
embodying new technologies, could render the Company's existing services
obsolete or unmarketable. There can be no assurance that the Company will be
successful in identifying and developing new services that respond to
technological change, that the Company will not experience difficulties that
could delay or prevent the successful development, introduction and marketing of
these services or that its new or enhanced services will adequately meet the
requirements of the marketplace and achieve market acceptance. See 'Business.'

COMPETITION

The markets for the Company's services are highly competitive. The
principal competitive factors affecting the Company are effectiveness,
reliability, price, technological sophistication and timeliness. Numerous
specialty companies compete with the Company in each of its business lines
although no single company competes across all service lines. Many of the
Company's competitors or potential competitors have longer operating histories,
longer client relationships and significantly greater financial, management,
technological, sales, marketing and other resources than the Company. In
addition, clients could perform internally all or certain of the services
provided by the Company rather than outsourcing such services. The Company
expects that competition will increase substantially as a result of industry
consolidations and alliances, as well as through the emergence of new
competitors. The Company believes that the market for communications services
may become increasingly concentrated in the future as a result of the
acquisition and integration of smaller service providers, which are likely to
permit many of the Company's competitors to devote significantly greater
resources to the development and marketing of new competitive services. There
can be no assurance that existing or future competitors will not develop or
offer communications services that provide significant performance, price,
creative or other advantages over those offered by the Company. The Company
could face competition from companies in related communications markets which
could offer services that are similar or superior to those offered by the
Company. In addition, national and regional telecommunications providers could
enter the market with materially lower electronic delivery costs, and radio and
television networks could also begin transmitting business communications
separate from their news programming. The Company's ability to maintain and
attract clients depends to a significant degree on the quality of services
provided and its reputation among its clients and potential clients as compared
to that of competitors. There can be no assurance that the Company will not face
increased competition in the future or that such competition will not have a
material adverse effect on the Company's business, operating results and
financial condition.

MANAGEMENT OF GROWTH; RISKS ASSOCIATED WITH EXPANSION

The Company's business has grown rapidly in recent years. The Company's
expansion has resulted, and is expected in the future to result, in substantial
growth in the number of its employees and in increased responsibility for both

existing and new management personnel. The Company's success depends to a
significant extent on the ability of its executive officers and other members of
senior management, only one of whom has any executive management experience with
a public company, to manage that growth and operate effectively, both
independently and as a group. See 'Management.'

In addition, the Company plans to expand its services and open new offices.
There can be no assurance that the Company will be able to manage its recent or
any future expansion effectively and profitably, and any inability to do so
would have a material adverse effect on the Company's business, operating
results and financial condition. There also can be no assurance that the Company
will be able to sustain the rates of growth that it has experienced in the past.

ABSENCE OF LONG-TERM CONTRACTS

The Company's clients generally retain the Company on a project-by-project
basis rather than under long-term contracts. As a result, there can be no
assurance that a client will engage the Company for further services once a
project is completed. To the extent that a large number of the Company's current
clients do not continue to use the Company's services, and the Company is unable
to attract new clients, there would be a material adverse effect on the
Company's business, operating results and financial condition.

9
<PAGE>
SUSCEPTIBILITY TO GENERAL ECONOMIC CONDITIONS

The Company's revenues are affected by its clients' marketing
communications spending and advertising budgets. The Company's revenues and
results of operations may be subject to fluctuations based upon general economic
conditions in the geographic locations where it distributes its material. If
there were to be a general economic downturn or a recession in these geographic
locations, then the Company expects that business enterprises, including its
clients and potential clients, could substantially and immediately reduce their
marketing and communications budgets. In the event of such an economic downturn,
there would be a material adverse effect on the Company's business, operating
results and financial condition.

CONCENTRATION OF STOCK OWNERSHIP; POTENTIAL ISSUANCE OF PREFERRED STOCK;
PROVISIONS WITH POTENTIAL ANTI-TAKEOVER EFFECTS

Upon completion of this offering, the executive officers and directors of
the Company and their affiliates and other holders of 5% or more of the Common
Stock will beneficially own approximately 38.4% of the Common Stock
(approximately % if the Underwriters' over-allotment option is exercised in
full). As a result, these stockholders will be able to control or significantly
influence all matters requiring stockholder approval, including the election of
directors and approval of significant corporate transactions. Such concentration
of ownership may have the effect of delaying or preventing a change in control
of the Company. See 'Principal Stockholders.'

In addition, the Company's Board of Directors has the authority to issue up
to 1,000,000 shares of Preferred Stock and to determine the price, rights,
preferences, privileges and restrictions thereof, including voting rights,

without any further vote or action by the Company's stockholders. Although the
Company has no current plans to issue any shares of Preferred Stock, the rights
of the holders of Common Stock would be subject to, and may be adversely
affected by, the rights of the holders of any Preferred Stock that may be issued
in the future. Issuance of Preferred Stock could have the effect of delaying,
deferring or preventing a change in control of the Company. Furthermore, certain
provisions of the Company's Amended and Restated Certificate of Incorporation
and Amended and Restated Bylaws and of Delaware law could have the effect of
delaying, deferring or preventing a change in control of the Company. See
'Management,' 'Certain Transactions,' 'Principal and Selling Stockholders' and
'Description of Capital Stock.'

The Company is subject to the provisions of Section 203 of the Delaware
General Corporation Law which prevent certain Delaware corporations, including
those whose securities are listed on the Nasdaq National Market, from engaging,
under certain circumstances, in a 'business combination' with any 'interested
stockholder' for three years following the date that such stockholder became an
'interested stockholder.' A Delaware corporation may 'opt out' of this law with
an express provision in its original certificate of incorporation or an
amendment either to its certificate of incorporation or to its by-laws approved
by a majority of the outstanding voting shares. The Company has not opted out of
the law which may inhibit a third party 'interested stockholder' from commencing
a 'business combination.'

DISCRETION IN USE OF PROCEEDS

The Company intends to use the net proceeds from the sale of the Common
Stock offered hereby for general corporate purposes and possible acquisitions.
The Company, however, has not designated any specific use for these proceeds.
Accordingly, the Company will have complete discretion with respect to the use
of these proceeds and there can be no assurance that they can or will be
invested to yield a significant return. See 'Use of Proceeds.'

NO PRIOR MARKET; POSSIBLE VOLATILITY OF STOCK PRICE

Prior to this offering there has been no public market for the Company's
Common Stock and, although the Company has applied to have the Common Stock
approved for quotation and trading on the Nasdaq National Market, there can be
no assurance that an active trading market will develop or be sustained after
this offering. The initial public offering price of the Common Stock offered
hereby will be determined through negotiations among the Company and the
Representatives of the Underwriters and may not be indicative of future market
prices. There can be no assurance that the market price of the Common Stock will
not decline below the initial public offering price. The trading prices of the
Common Stock may be highly volatile and subject to wide fluctuations in response
to a number of factors, including variations in operating results, limited
trading volume,

10
<PAGE>
failure to meet expectations of, or a change in recommendation by, securities
analysts, announcements of extraordinary events such as litigation or
acquisitions, announcements of technological innovations or new services by the
Company or its competitors, as well as trends in the Company's industry and

general market conditions. In addition, stock markets have experienced extreme
price and volume fluctuations in recent years. This volatility has had a
substantial effect on the market prices of securities of many companies for
reasons frequently unrelated to the operating performance of the specific
companies. These broad market fluctuations may adversely affect the market price
of the Company's Common Stock. See 'Underwriting.'

IMMEDIATE AND SUBSTANTIAL DILUTION

Assuming an initial public offering price of $10.00 per share, investors
participating in this offering will incur immediate, substantial dilution of
approximately $6.10 in the net tangible book value per share. To the extent
outstanding options to purchase the Company's Common Stock are exercised, there
will be further dilution to such investors. See 'Dilution.'

SHARES ELIGIBLE FOR FUTURE SALES

Sales of a substantial number of shares of Common Stock in the public
market following this offering or the prospect of such sales could adversely
affect the market price of the Common Stock prevailing from time to time.

Upon completion of this offering, the Company will have 5,047,933 shares of
Common Stock outstanding. Of these shares, 2,000,000 shares of Common Stock
offered hereby will be freely transferable without restriction unless purchased
by 'affiliates' of the Company as that term is defined under Rule 144 ('Rule
144') promulgated under the Securities Act of 1933, as amended (the 'Securities
Act'). The remaining shares will be 'restricted securities' as that term is
defined in Rule 144 under the Securities Act and may not be sold other than
pursuant to an effective registration statement under the Securities Act or
pursuant to an exemption from such registration requirement. Subject to the
contractual restrictions discussed below, 3,021,412 shares of Common Stock will
be eligible for sale under Rule 144 from the date of this Prospectus. 2,111,669
of such shares are entitled to certain registration rights. See 'Description of
Capital Stock.' Certain of the Company's stockholders are subject to lock-up
agreements under which they have agreed not to sell or otherwise dispose of any
shares of Common Stock without the prior written consent of Dean Witter Reynolds
Inc. for a period of 180 days after the date of this Prospectus whether now
owned or hereafter acquired by such stockholders or with respect to which such
stockholders have or hereafter acquire the power of disposition or enter into
any swap or any other agreement or any transaction that transfers, in whole or
in part, directly or indirectly, the economic consequence of ownership of the
Common Stock or any Common Stock deemed to be beneficially owned by such
stockholders, whether any such swap or transaction is to be settled by delivery
of Common Stock or other securities, in cash or otherwise. Such stockholders
also have agreed not to exercise their registration rights for 180 days after
the date of this Prospectus and have granted Dean Witter Reynolds Inc. the right
of first refusal to be engaged as the lead manager of the underwritten public
offering of their shares if registration rights are exercised following the
expiration of the lock-up period until the date that is 12 months from the date
of this Prospectus. The Company has consented to any such engagement of Dean
Witter Reynolds Inc. The Company has agreed not to issue or sell any shares of

Common Stock, without the prior written consent of Dean Witter Reynolds Inc. for
a period of 180 days after the date of this Prospectus other than the issuance
of shares upon the exercise of stock options. Upon the expiration of the 180-day
lock-up period, certain of the shares of Common Stock subject to the lock-up
agreements will become eligible for sale in the public market subject to the
conditions of Rule 144. See 'Underwriting' and 'Shares Eligible For Future
Sales.'

The Company intends to file a Registration Statement on Form S-8 to
register the 812,648 shares of Common Stock issuable upon the exercise of
options granted under the Stock Option Plan and the Directors Stock Option Plan.
Following the filing of the Form S-8, shares of Common Stock issued upon the
exercise of options granted under the Stock Option Plan and the Directors Stock
Option Plan will be available for sale in the public market upon vesting of such
options, subject to Rule 144 volume limitations applicable to affiliates.

<PAGE>
USE OF PROCEEDS

The net proceeds to the Company from the sale of the 2,000,000 shares of
Common Stock offered by the Company hereby are estimated to be $17.9 million,
assuming a public offering price of $10.00 per share, and after deducting the
Underwriters' discounts and commissions and the estimated offering expenses
payable by the Company.

The Company intends to use the net proceeds of this offering for general
corporate purposes and possible acquisitions. No portion of the proceeds of this
offering has been allocated to any specific acquisition. Although the Company
reviews and considers possible acquisitions on an on-going basis, no specific
acquisitions are planned as of the date of this Prospectus. Pending such uses,
the Company plans to invest the net proceeds of this offering in short-term,
interest-bearing investment grade securities. See 'Business.'

DIVIDEND POLICY

The Company has never paid dividends on its Common Stock. The Company
intends to retain any earnings to provide funds for utilization in its business
and does not anticipate paying any cash dividends on its Common Stock in the
foreseeable future. The Company's loan agreement contains provisions which
prohibit the payment of cash dividends by the Company.

<PAGE>
DILUTION

At September 30, 1996 the pro forma net tangible book value of the Company,
as adjusted to give effect to the Preferred Stock Conversions as if the
Preferred Stock Conversions had occurred on September 30, 1996, was $1,802,533
or $0.59 per share of Common Stock outstanding. 'Pro Forma net tangible book
value' per share represents the total amount of the Company's tangible assets
less total liabilities, divided by the number of shares of Common Stock
outstanding prior to the offering. After giving effect to the sale by the
Company of the 2,000,000 shares of Common Stock offered hereby (at an assumed
initial public offering price of $10.00 per share and after deducting estimated
underwriting discounts and offering expenses), the pro forma net tangible book
value of the Company at September 30, 1996 would have been $19,702,533 or $3.90
per share. This amount represents an immediate increase of $3.31 per share to
existing stockholders and an immediate dilution of $6.10 per share to new
investors. The following table illustrates this per share dilution:

<TABLE>
<S> <C> <C>
Assumed initial public offering price per share of Common Stock....................... $10.00
Pro forma net tangible book value per share before the offering.................. $0.59
Increase per share attributable to the offering.................................. 3.31
-----
Pro forma net tangible book value per share of Common Stock after the offering........ 3.90
------
Dilution per share to new investors in the offering................................... $ 6.10
------
------
</TABLE>

The following table sets forth, on a pro forma basis at September 30, 1996,
after giving effect to the Preferred Stock Conversions and the offering, the
number of shares of Common Stock purchased from the Company, the total
consideration paid and the average price per share paid by the existing
stockholders and by the investors purchasing shares of Common Stock offered
hereby (assuming an initial public offering price of $10.00 per share before
deducting underwriting discounts and offering expenses):

<TABLE>
<CAPTION>
SHARES PURCHASED TOTAL CONSIDERATION AVERAGE
--------------------- ---------------------- PRICE
NUMBER PERCENT AMOUNT PERCENT PER SHARE
---------- ------- ----------- ------- ---------
<S> <C> <C> <C> <C> <C>
Existing stockholders(1).................. 3,047,933 60.4% $ 3,884,261 16.3% $ 1.27
New investors(1).......................... 2,000,000 39.6 20,000,000 83.7 10.00
---------- ------- ----------- -------
Total..................................... 5,047,933 100.0% $23,884,261 100.0%
---------- ------- ----------- -------
---------- ------- ----------- -------
</TABLE>

- ------------------
(1) If the over-allotment option is exercised in full, sales by Selling
Stockholders will reduce the number of shares held by the existing
stockholders to 2,747,933 shares or approximately 54.4% of the total shares
of Common Stock outstanding and will increase the number of shares held by
new investors to 2,300,000 or approximately 45.6% of the total shares of
Common Stock outstanding after this offering. See 'Principal and Selling
Stockholders.'

The foregoing computations assume no exercise of options to purchase
569,594 shares of Common Stock reserved for issuance under the Company's Stock
Option Plan at a weighted average exercise price of $3.16 per share and 62,400

shares of Common Stock reserved for issuance under the Directors Stock Option
Plan at an exercise price of $3.54 per share. To the extent that any outstanding
options are exercised, there will be further dilution to new investors. See
'Management.'

<PAGE>
CAPITALIZATION

The following table sets forth the capitalization of the Company (i) on an
actual basis as of September 30, 1996 and (ii) as adjusted to give effect to the
Preferred Stock Conversions and the issuance and sale by the Company of the
2,000,000 shares of Common Stock offered hereby, at an estimated initial public
offering price of $10.00 per share, and the receipt of the estimated net
proceeds therefrom, after deducting the underwriting discounts and commissions
and estimated offering expenses payable by the Company. This table should be
read in conjunction with the Financial Statements and related Notes thereto,
'Management's Discussion and Analysis of Financial Condition and Results of
Operations' and the Unaudited Pro Forma Condensed Combined Financial Statements
appearing elsewhere in this Prospectus.

<TABLE>
<CAPTION>
SEPTEMBER 30, 1996
-------------------------
ACTUAL AS ADJUSTED
---------- -----------
<S> <C> <C>
Current portion of long-term debt........................................ $ 37,143 $ 37,143
---------- -----------
---------- -----------
Long-term debt........................................................... $ 283,950 $ 283,950
Stockholders' equity(1)
Preferred Stock, $.01 par value, 1,000,000 shares authorized; none
issued and outstanding, actual and as adjusted(2)................... -- --
Series A, 10% Cumulative Convertible Preferred Stock, $1.50 par value;
655,417 shares authorized, issued and outstanding actual; none
issued and outstanding as adjusted.................................. 983,126 --
Series B, 10% Cumulative Preferred Stock, $1.35 par value; 475,185
shares authorized, issued and outstanding actual; none issued and
outstanding as adjusted............................................. 641,500 --
Series C, 10% Cumulative Convertible Preferred Stock, $2.75 par value;
645,455 shares authorized; 629,130 shares issued and outstanding
actual; none issued and outstanding as adjusted..................... 1,730,107 --
Common Stock, $.01 par value, 15,000,000 shares authorized; 936,264
shares issued and outstanding actual; 5,047,933 shares issued and
outstanding as adjusted............................................. 9,363 50,479
Additional paid-in capital............................................... 520,165 21,733,782
Accumulated deficit...................................................... (711,012) (711,012)
Equity adjustment for foreign currency translation....................... (634) (634)
---------- -----------
Total stockholders' equity............................................. 3,172,615 21,072,615
---------- -----------
Total capitalization..................................................... $3,456,565 $21,356,565
---------- -----------
---------- -----------
</TABLE>

- ------------------
(1) Does not include an aggregate of (i) 569,594 shares of Common Stock issuable
upon exercise of options outstanding under the Company's Stock Option Plan
at a weighted average exercise price of $3.16 per share of Common Stock and
(ii) 62,400 shares of Common Stock reserved for issuance upon exercise of
options outstanding under the Directors Stock Option Plan, at an exercise
price of $3.54 per share.

(2) Contingent upon the effectiveness of this offering.

<PAGE>
SELECTED FINANCIAL INFORMATION
(IN THOUSANDS, EXCEPT PER SHARE AND OTHER DATA)

The following selected historical financial information presented below as
of and for each of the five years ended December 31, 1995 have been derived from
financial statements of the Company audited by KPMG Peat Marwick LLP,
independent certified public accountants. The financial statements as of
December 31, 1994 and 1995 and for each of the years in the three year period
ended December 31, 1995 are included elsewhere in this Prospectus. The selected
unaudited historical information presented below for the nine month periods
ended September 30, 1995 and 1996 and as of September 30, 1996, are derived from
the unaudited financial statements of the Company included elsewhere in this
Prospectus. In the opinion of management of the Company, the unaudited financial
information reflects all adjustments, consisting of normal recurring
adjustments, necessary to present fairly the financial information for such
periods and as of such date. The results of the nine month periods ended
September 30, 1995 and 1996 are not necessarily indicative of results to be
expected for the full year.

The unaudited pro forma information gives effect to the PR Data Acquisition
as if it had occurred at the beginning of the period presented. The pro forma
information is not necessarily indicative of the results of operations that
would have been reported if the PR Data Acquisition had occurred during those
periods, or that may be reported in the future.

This data should be read in conjunction with the historical financial
statements of the Company and PR Data Systems Inc. ('PR Data') and the Unaudited
Pro Forma Condensed Combined Financial Statements of the Company appearing
elsewhere in this Prospectus.

Gross profit.................. 3,024 3,577 3,435 4,509 6,071 7,492 4,100 6,553 7,318
General and administrative
expenses.................... 2,937 3,437 3,651 4,069 5,373 6,787 3,797 5,548 6,307
-------- -------- -------- -------- -------- --------- ------ ------- ---------
Operating income (loss)....... 87 140 (215) 440 698 705 303 1,005 1,011
Other income (expense)........ (12) 18 (3) 1 15 (11 ) 12 5 (27)
-------- -------- -------- -------- -------- --------- ------ ------- ---------
Income (loss) before income
taxes....................... 75 158 (218) 441 713 694 315 1,010 984
Income tax expense
(benefit)................... 26 63 13 (1,023)(1) 332 320 149 431 417
-------- -------- -------- -------- -------- --------- ------ ------- ---------
Income (loss) from continuing
operations before
discontinued operations and
extraordinary
item........................ 49 95 (231) 1,464(1) 381 374 166 579 567
Net income (loss)............. $ 21(2) $ 144(2) $ (231) $ 1,464(1) $ 381 $ 374 $ 166 $ 579 $ 567
-------- -------- -------- -------- -------- --------- ------ ------- ---------
-------- -------- -------- -------- -------- --------- ------ ------- ---------
Net income (loss) applicable
to common stock............. $ (295)(2) $ (184)(2) $ (566) $ 1,129 $ 46 $ 374 $ (85 ) $ 327 $ 567
Net income (loss) before tax
valuation reversal(1)....... $ 21(2) $ 144 (2) $ (231) $ 222 $ 381 $ 374 $ 166 $ 579 $ 567
Pro forma net income per
share(3) $ 0.11 $0.05 $ 0.17
Shares used to compute pro
forma net income per
share(3).................... 3,453 3,453 3,485
OTHER DATA:
Number of offices............. 4 4 5 6 7 8 7 8 8
Average revenues per sales
employee.................... $326,000 $322,000 $347,000 $414,000 $506,000 $532,000
</TABLE>

<TABLE>
<CAPTION>
DECEMBER 31, SEPTEMBER 30,
---------------------------------------------- -------------
1991 1992 1993 1994 1995 1996
------ ------ ------ ------ ------ -------------
<S> <C> <C> <C> <C> <C> <C>
BALANCE SHEET DATA:
Working capital.......................................... $ 248 $ 370 $ 218 $ 887 $1,722 $ 1,500
Total assets............................................. 1,399 1,483 1,683 3,237 4,387 6,551
Long-term debt, net of current portion................... 30 -- -- -- -- 284
Stockholders' equity..................................... 488 750 557 2,017 2,425 3,173
</TABLE>

- ------------------
(1) In accordance with Statement of Financial Accounting Standards No. 109, the
Company reversed its valuation allowance against deferred tax assets in the
amount of $1,242,000 in 1994. See Note 5 to the Company's Financial
Statements.

(2) Includes a loss of $40,000 from discontinued operations in 1991 and the
utilization of net operating losses resulting in tax benefits of $12,000 in
1991 and $49,000 in 1992.

(3) See Note 9 to the Company's Financial Statements for an explanation of the
method used to determine the number of shares.

<PAGE>
MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS

OVERVIEW

The following discussion of the Company's historical results of operations
and of its liquidity and capital resources should be read in conjunction with
the Selected Financial Information of the Company and the Financial Statements
of the Company and the Notes thereto included elsewhere in the Prospectus.

The Company was formed in September 1986 and initially concentrated on the
satellite distribution of VNRs and the electronic monitoring of their broadcast
on television. The Company has grown as a result of the introduction of new
services and domestic and international expansion. The Company now provides a
wide array of services on a worldwide basis. These services include video
distribution and monitoring (introduced in 1987), live broadcasts, including
satellite media tours and video conferencing (1988), video production, research
and analysis of marketing communications campaigns and programs (1994) and audio
distribution and production (1996). Services introduced since 1994 (video
production, audio distribution and production, research and analysis, and print
distribution) accounted for approximately 27% of revenues for the nine months
ended September 30, 1996. The PR Data Acquisition in July 1996 has expanded the
Company's research capabilities and added print news release distribution
services. The following table illustrates on a percentage of revenues basis the
changing mix of the Company's revenues since 1992:

<TABLE>
<CAPTION>
NINE MONTHS
ENDED
YEARS ENDED DECEMBER 31, SEPTEMBER 30,
---------------------------- -------------
SERVICES 1992 1993 1994 1995 1996
- -------------------------------------------- ---- ---- ---- ---- -------------
<S> <C> <C> <C> <C> <C>
Video distribution and monitoring........... 73% 75% 73% 61% 52%
Video production............................ -- NM 7 12 19
Live broadcasts............................. 27 25 20 22 21
Audio distribution and production........... -- -- -- -- 2
Research and analysis....................... -- -- NM 5 5
Print distribution.......................... -- -- -- -- 1
</TABLE>

The Company launched its international services and established an office
in London in 1993. The Company has since developed 17 affiliate relationships
which enable the Company to provide global production and distribution.
International revenues more than quadrupled from $360,000 in 1993 to $1.5
million in 1995. International revenues increased by $1.1 million, or 110% from

$1.0 million for the nine months ended September 30, 1995 to $2.1 million for
the nine months ended September 30, 1996.

In addition to adding new services, the Company has continued to expand
geographically by adding new offices, most recently in Dallas in 1994 and
Atlanta in 1995, and by adding personnel to existing offices. Each new office
has resulted in the development of new client relationships.

Clients pay for production, distribution, monitoring and live broadcasts on
a fixed-fee basis. The Company does not charge the media for airing the clients'
material. The Company's revenues do not depend on the usage by the media of the
clients' material. The Company's production department specifies in advance of
each project the services to be provided for the specified fee. In the event
that a project requires additional services, the client incurs additional fees.
Research is conducted pursuant to contracts and on a project basis. These
contracts and projects are priced on a fixed-fee basis. Distribution and live
broadcast revenues are recognized upon the completion of the project. Video
production and research revenues are recognized on the percentage of completion
basis. Generally, video production projects are completed within one month from
the time they are initiated; research projects can last for up to one year.

Direct costs include costs associated with the use of the AP
Express/Medialink Newswire, satellite transmission, electronic monitoring,
production crews, editing, studios, tabulation services and sales commissions.
Satellite transmission costs have increased during the past two years. During
the third quarter of 1995 the Company began to pass such increase in costs to
its clients. General and administrative expenses

16
<PAGE>
include all salary-related costs as well as general overhead costs such as
advertising, travel and entertainment expenses, and rent.

The Company consummated the PR Data Acquisition in July 1996. PR Data had
revenues of approximately $1.7 million in 1995. The Company paid for the PR Data
Acquisition through the payment of $120,000 cash, the issuance of 24,000 shares
of Common Stock and the assumption of certain liabilities not to exceed the book
value of the assets acquired by $372,000. In addition, the Company will make
payments in the aggregate amount of $410,000 payable over the next five years
under the terms of non-compete agreements with certain officers and stockholders
of PR Data. The transaction was accounted for as a purchase.

GENERAL

Results of Operations

The following table sets forth for the periods indicated certain components
of the Company's statement of operations as a percentage of revenues.

<TABLE>
<CAPTION>
YEARS ENDED DECEMBER 31,
----------------------------------------
1993 1994 1995
------------------------ ------------------------ ------------------------
<S> <C> <C> <C>
Revenues.............................. 100.0% 100.0% 100.0%
Direct costs.......................... 43.4 40.3 42.9
------ ------ ------
Gross profit.......................... 56.6 59.7 57.1
General and administrative expenses... 60.2 53.9 50.6
------ ------ ------
Operating income (loss)............... (3.6) 5.8 6.5
Other income.......................... -- -- 0.1
------ ------ ------
Income (loss) before income taxes..... (3.6) 5.8 6.6
Income tax expense (benefit).......... 0.2 (13.6)(1) 3.1
------ ------ ------
Net income (loss)..................... (3.8)% 19.4%(1) 3.5%
------ ------ ------
------ ------ ------

<CAPTION>
NINE MONTHS ENDED SEPTEMBER 30,
------------------------------------------------------------------
1995 1996
------------------------------- -------------------------------
<S> <C> <C>
Revenues.............................. 100.0% 100.0%
Direct costs.......................... 44.5 41.3
------ ------
Gross profit.......................... 55.5 58.7
General and administrative expenses... 51.4 49.7
------ ------
Operating income (loss)............... 4.1 9.0
Other income.......................... 0.1 0.0
------ ------
Income (loss) before income taxes..... 4.2 9.0
Income tax expense (benefit).......... 2.0 3.8
------ ------
Net income (loss)..................... 2.2% 5.2%
------ ------
------ ------
</TABLE>

- ------------------
(1) In accordance with Statement of Financial Accounting Standards No. 109, the
Company reversed its valuation allowance against deferred tax assets in the

amount of $1,242,000 in 1994. See Note 5 to the Company's Financial
Statements.

NINE MONTHS ENDED SEPTEMBER 30, 1996 COMPARED TO THE NINE MONTHS ENDED SEPTEMBER
30, 1995

Revenues. Revenues increased by $3.8 million, or 51.2%, from $7.4 million
for the nine months ended September 30, 1995 (the 'September 1995 Period') to
$11.2 million for the nine months ended September 30, 1996 (the 'September 1996
Period'). This increase was primarily due to increased sales of VNR production
services, which increased by $1.2 million, increased sales of VNR distribution
services, which increased by $1.3 million, and live broadcast services, which
increased by $687,000. In addition, following the PR Data Acquisition in July
1996 Medialink PR Data contributed $250,000 to the Company's revenues. Revenues
from international services contributed $941,000 to the Company's revenue
growth.

Direct Costs. Direct costs increased by $1.3 million, or 40.2%, from $3.3
million for the September 1995 Period to $4.6 million for the September 1996
Period. Direct costs as a percentage of revenues decreased to 41.3% for the
September 1996 Period from 44.5% for the September 1995 Period, reflecting an
increase in business activity and the mix of business during the period.

General and Administrative Expenses. General and administrative expenses
increased by $1.7 million, or 46.2%, from $3.8 million for the September 1995
Period to $5.5 million for the September 1996 Period. General

17
<PAGE>

and administrative expenses as a percentage of revenues decreased to 49.7% for
the September 1996 Period from 51.4% for the September 1995 Period. Salary
related costs increased by $1.0 million as the Company strengthened its upper
and mid-level management, expanded its sales and operations staff and as a
result of the PR Data Acquisition. In addition, sales and marketing costs
increased by $108,000 for the September 1996 Period and rent and utilities
increased by $149,000 for the September 1996 Period resulting from the expansion
of the Company's sales and operations staff and the PR Data Acquisition.

Operating Income. As a result of the foregoing, operating income increased
by $702,000, or 231.7%, from $303,000 for the September 1995 Period to $1.0
million for the September 1996 Period. As a percentage of revenues, operating
income for the September 30, 1996 Period was 9.0% as compared with 4.1% for the
September 1995 Period.

Income Tax Expense. Income tax expense reflects an allocation based on the
full year anticipated tax expense. Combined federal, state and local taxes were
anticipated to be 42.7% for the September 1996 Period and were 47.2% for the
September 1995 Period.

YEAR ENDED DECEMBER 31, 1995 COMPARED TO THE YEAR ENDED DECEMBER 31, 1994

Revenues. Revenues increased by $3.1 million, or 40.7%, from $7.5 million
for the year ended December 31, 1994 to $10.6 million for the year ended
December 31, 1995. The increase was primarily due to increased sales of VNR
distribution services, which increased by $930,000, VNR production services,
which increased by $780,000, live broadcast services, which increased by
$780,000, and research and analysis services, which increased by $500,000. These
increases were primarily attributable to international revenue growth which
increased by $650,000, improved productivity of the Company's sales and
marketing team, the growth of U.S. production services and the introduction of
research and analysis services at the end of 1994.

Direct Costs. Direct costs increased by $1.6 million, or 49.9%, from $3.0
million in 1994 to $4.6 million in 1995. Direct costs as a percentage of
revenues increased from 40.3% of revenues for 1994 to 42.9% of revenues for
1995. This increase was attributable to a change in the mix of the Company's
business and an increase in satellite costs.

General and Administrative Expenses. General and administrative expenses
increased by $1.3 million, or 32.0%, from $4.1 million in 1994 to $5.4 million
in 1995. General and administrative expenses as a percentage of revenues
decreased to 50.6% in 1995 from 53.9% in 1994. Salary-related costs increased by
$700,000 in 1995 as the Company increased its staff to respond to the increased
demand for the Company's services and sales and marketing costs increased by
$100,000 in 1995.

Operating Income. As a result of the foregoing, operating income increased
by $258,000, or 58.6%, from $440,000 in 1994 to $698,000 in 1995. As a
percentage of revenues, operating income for 1995 was 6.5% as compared with 5.8%
for 1994.

Income Tax Expense (Benefit). In 1994 the income tax benefit resulted
primarily from the reversal of the balance of the Company's valuation allowance
on deferred tax assets in accordance with SFAS No. 109 as a result of the
Company's determination that it had become more likely than not that such
deferred tax assets would be realized.

YEAR ENDED DECEMBER 31, 1994 COMPARED TO THE YEAR ENDED DECEMBER 31, 1993

Revenues. Revenues increased by $1.5 million, or 24.4%, from $6.0 million
for the year ended December 31, 1993 to $7.5 million in the year ended December
31, 1994. This increase was primarily due to increased sales of VNR distribution
services which increased by $1.0 million, and VNR production services which
increased by $490,000. These increases were primarily attributable to improved

productivity of the Company's sales and marketing team, the introduction of VNR
production services in the U.S. and international revenue growth which increased
by $475,000.

Direct Costs. Direct costs increased by $409,000, or 15.6%, from $2.6
million in 1993 to $3.0 million in 1994. Direct costs as a percentage of
revenues decreased to 40.3% in 1994 from 43.3% in 1993. The gross margin
improved as a result of the change in the mix in the Company's business.

18
<PAGE>
General and Administrative Expenses. General and administrative expenses
increased by $418,000, or 11.5%, from $3.7 million in 1993 to $4.1 million in
1994. General and administrative expenses as a percentage of revenues decreased
to 53.9% in 1994 from 60.2% in 1993. Salary-related costs increased by $219,000
in 1994 and sales and marketing costs increased by $84,000 in 1994.

Operating Income (Loss). As a result of the foregoing, operating income
increased by $656,000, from an operating loss of $215,000 in 1993 to an
operating profit of $440,000 in 1994. As a percentage of revenues, operating
income for 1994 was 5.8% as compared with a loss of 3.5% for 1993.

Income Tax Expense (Benefit). Income tax expense reflected on the
statement of operations represents federal, state and local taxes. In 1994 the
income tax benefit resulted primarily from the reversal of the Company's
valuation allowance on deferred tax assets in accordance with SFAS No. 109. In
1993, income tax expense reflected state and local taxes as the Company had
determined that, based on its operating losses and the level of its deferred tax
assets, it was unable to conclude that it was more likely than not that such
deferred tax assets would be realized in the future.

QUARTERLY RESULTS

The Company experiences quarterly seasonal variations in revenues as a
result of several factors, including its clients' business cycles and timing of
product introductions. Accordingly, since the Company's salary and overhead
costs are relatively stable from quarter to quarter, the Company's results from
operations have been higher in the second and fourth quarters. The following
table presents the Company's operating results for the eight quarters ended
September 30, 1996. The information for each of these quarters is unaudited but
has been prepared on the same basis as the Company's audited financial
statements and in the opinion of the Company's management reflects all the
adjustments made in conjunction with the Company's audited financial statements
and notes thereto appearing elsewhere in the prospectus. Operating results for
any quarter are not indicative of results for any future periods.

<TABLE>
<CAPTION>
THREE MONTHS ENDED
----------------------------------------------------------------------------------------
DECEMBER 31, MARCH 31, JUNE 30, SEPTEMBER 30, DECEMBER 31, MARCH 31, JUNE 30,
1994 1995 1995 1995 1995 1996 1996
------------ --------- -------- ------------- ------------ --------- --------
(IN THOUSANDS)
<S> <C> <C> <C> <C> <C> <C> <C>
Revenues........................ $ 2,126 $ 2,018 $ 2,920 $ 2,445 $ 3,242 $ 3,329 $ 4,102
Direct costs.................... 860 876 1,329 1,078 1,270 1,439 1,769
------------ --------- -------- ------------- ------------ --------- --------
Gross profit.................... 1,266 1,142 1,591 1,367 1,972 1,890 2,333
General and administrative
expenses...................... 1,099 1,192 1,284 1,319 1,578 1,568 1,832
------------ --------- -------- ------------- ------------ --------- --------
Operating income (loss)......... 167 (50) 307 48 394 322 501
Other income (expense).......... 2 3 4 5 3 7 6
------------ --------- -------- ------------- ------------ --------- --------
Income (loss) before taxes...... 169 (47) 311 53 397 329 507
Income tax expense (benefit).... 69 (22) 145 25 185 134 207
------------ --------- -------- ------------- ------------ --------- --------
Net income (loss)............... $ 100 $ (25) $ 166 $ 28 $ 212 $ 195 $ 300
------------ --------- -------- ------------- ------------ --------- --------
------------ --------- -------- ------------- ------------ --------- --------
Pro forma net income (loss) per
share(1)...................... $ 0.03 $ (0.01) $ 0.05 $ 0.01 $ 0.06 $ 0.05 $ 0.09

<CAPTION>
THREE MONTHS
ENDED
--------------
SEPTEMBER 30,
1996
--------------
(IN THOUSANDS)
<S> <C>
Revenues........................ $ 3,727
Direct costs.................... 1,397
-------------
Gross profit.................... 2,330
General and administrative
expenses...................... 2,148
-------------
Operating income (loss)......... 182
Other income (expense).......... (9)
-------------
Income (loss) before taxes...... 173
Income tax expense (benefit).... 90
-------------
Net income (loss)............... $ 83
-------------
-------------
Pro forma net income (loss) per
share(1)...................... $ 0.03
</TABLE>

<TABLE>
<CAPTION>
AS A PERCENTAGE OF REVENUES
----------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
Revenues........................ 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0%
Direct costs.................... 40.5 43.4 45.5 44.2 39.2 43.2 43.1
------------ --------- -------- ------------- ------------ --------- --------
Gross profit.................... 59.5 56.6 54.5 55.8 60.8 56.8 56.9
General and administrative
expenses...................... 51.6 59.0 44.0 53.9 48.7 47.1 44.7
------------ --------- -------- ------------- ------------ --------- --------
Operating income (loss)......... 7.9 (2.4) 10.5 1.9 12.1 9.7 12.2
Other income (expense).......... -- 0.1 0.1 0.2 0.1 0.2 0.1
------------ --------- -------- ------------- ------------ --------- --------
Income (loss) before taxes...... 7.9 (2.3) 10.6 2.1 12.2 9.9 12.3
Income tax expense (benefit).... 3.2 (1.1) 5.0 1.0 5.7 4.0 5.0
------------ --------- -------- ------------- ------------ --------- --------
Net income (loss)............... 4.7% (1.2)% 5.6% 1.1% 6.5% 5.9% 7.3%
------------ --------- -------- ------------- ------------ --------- --------
------------ --------- -------- ------------- ------------ --------- --------

<CAPTION>
AS A
PERCENTAGE
OF REVENUES
-------------
<S> <C>
Revenues........................ 100.0%
Direct costs.................... 37.5
-------------
Gross profit.................... 62.5
General and administrative
expenses...................... 57.7
-------------
Operating income (loss)......... 4.8
Other income (expense).......... (0.2)
-------------
Income (loss) before taxes...... 4.6
Income tax expense (benefit).... 2.4
-------------
Net income (loss)............... 2.2%
-------------
-------------
</TABLE>

- ------------------
(1) See Note 9 to the Company's Financial Statements for an explanation of the
method used to determine the number of shares.

19
<PAGE>
LIQUIDITY AND CAPITAL RESOURCES

The Company has financed its operations primarily through cash generated
from operations. Since the end of 1994, the Company's cash balance has increased
by approximately $344,000 from $262,000 as of December 31, 1994 to $606,000 as
of September 30, 1996 as a result of continued profitability. The Company has no
capital expenditure plans other than in the ordinary course of business
consistent with its prior practices. Capital expenditures were approximately
$394,000 for 1995 and $412,000 for the nine months ended September 30, 1996. The
Company believes that the net proceeds from the offering and cash flow from
operations will be sufficient to fund its cash needs for at least the next
twelve months.

The Company has a credit facility secured by the Company's accounts
receivable and all other assets of the Company which matures on February 28,
1997, bears interest at the prime rate plus 1% and is payable monthly. Under the
terms of the credit facility, the Company can borrow up to the lesser of
$500,000 or 70% of its eligible accounts receivable, as defined in the agreement
governing the credit facility, and is prohibited from paying cash dividends on
its stock. As of September 30, 1996 the Company had no borrowings outstanding
under the credit facility.

EFFECTS OF NEW ACCOUNTING PRONOUNCEMENTS

Long-Lived Assets. In March 1995, the Financial Accounting Standards Board
('FASB') issued SFAS No. 121, 'Accounting for the Impairment of Long-Lived
Assets and for Long-Lived Assets to Be Disposed Of.' This statement is effective
for fiscal years beginning after December 15, 1995. The adoption of this
statement in fiscal 1996 did not have a material effect on the Company's
financial statements.

Stock-Based Compensation. In October 1995, the FASB issued SFAS No. 123,
'Accounting for Stock-Based Compensation,' which requires adoption of the
disclosure provisions no later than fiscal years beginning after December 15,
1995 and adoption of the measurement and recognition provisions for non-employee
transactions no later than after December 15, 1995. The new standard defines a
fair value method of accounting for the issuance of stock options and other
equity instruments. Under the fair value method, compensation cost is measured
at the grant date based on the fair value of the award and is recognized over
the service period, which is usually the vesting period. Pursuant to SFAS No.
123, companies are encouraged, but not required, to adopt the fair value method
of accounting for employee stock-based transactions. Companies are also
permitted to continue to account for such transactions under Accounting
Principles Board Opinion ('APB') No. 25, 'Accounting for Stock Issued to
Employees,' but would be required to disclose in a note to the financial
statements pro forma net income and per share amounts as if the company had
applied the new method of accounting. SFAS No. 123 also requires increased
disclosures for stock-based compensation arrangements regardless of the method
chosen to measure and recognize compensation for employee stock-based
arrangements. The Company has elected to continue to account for such
transactions under APB No. 25 and will disclose the required pro forma effect on
net income and earnings per share in its annual financial statements.

<PAGE>
BUSINESS

The Company began offering video production services in 1994 and has since
developed a full range of video, audio and print services which it now provides
on a global basis. Medialink enables its clients to reach more than 3,000
newsrooms at television and radio networks, local stations, cable channels,
direct broadcast satellite systems, as well as on-line services, including those
available on the Internet. The Company also coordinates live television
interviews through satellite media tours (SMTs) and produces live broadcasts of
newsworthy events for its clients. Similar to its video services, the Company
also offers its clients audio news releases (ANRs) and radio media tours (RMTs).
The Company believes that its proprietary database of over 40,000 news contacts,
which includes their editorial preferences and technical requirements, increases
the Company's efficiency.

The Company has provided its services to more than 1,100 clients over the
last twenty-four months. The Company's clients include corporations such as
General Motors, IBM, Johnson & Johnson, Sony and Ciba Geigy/Sandoz;
organizations such as the American Association of Retired Persons and the
AFL-CIO; and the world's largest marketing communications firms such as
Burson-Marsteller, Hill & Knowlton, Edelman Public Relations Worldwide and the
Shandwick Group. No single client accounted for more than 4% of the Company's
revenues in 1995. Materials distributed by the Company have aired on ABC, CBS,
NBC and their affiliates, as well as CNN and CNBC in the United States, and the
BCC, CNN International, Sky News, RAI (Italy) and NHK (Japan) internationally.

As an integral part of its services, the Company monitors media usage of
the material it distributes. Television usage is monitored using electronic
technology and data provided by several independent services, including Nielsen
Media Research and Competitive Media Reporting. Radio usage is monitored using
data provided by independent news tracking services, as well as data collected
automatically when radio stations call in to the Company's automated digital ANR
retrieval system. The Company provides its clients with monitoring reports which
include the date and time at which the clients' material was used, the media and
markets in which it was used and a report on the size and demographic
composition of the audience. The Company believes that this ability to
accurately monitor and report usage on a timely basis is critical to its
success. The Company also offers research and analysis services which provide
customized studies to measure the results of clients' public relations programs,
analyze competitive trends and measure return on investment of their marketing
communications efforts. As a result of the PR Data Acquisition in July 1996, the
Company expanded its research capabilities and added print news release

distribution services. In August 1996 the Company changed its corporate name
from Video Broadcasting Corporation to Medialink Worldwide Incorporated.

INDUSTRY BACKGROUND

While the Company serves a global marketplace, it believes that the North
American and United Kingdom markets for its services total approximately $500
million. The Company believes that the following trends have created growing
opportunities for its services in domestic and international markets:

Increasing Importance of Television as a Communications Medium. The
average amount of time that Americans over the age of 18 spend watching
television has increased by 5% over the last five years to 30 hours per week per
person and is projected to grow an additional 5% over the next five years
according to a regularly published industry source. At the same time, the
average time spent by that same group reading newspapers has
declined nearly 5% over this period to 3.25 hours per week and is expected to
continue to decline over the next five years according to the same source. In
addition, a 1994 survey by the Roper organization indicates that 72% of
Americans get most of their news from television.

21
<PAGE>
Growing Number of Media Outlets. As the number of traditional media
outlets (broadcast, cable television and radio) has increased and as new media
outlets (on-line and Internet) develop, there has also been a proliferation of
news programs such as MSNBC and CNNfn. As a result, it has become more difficult
to deliver newsworthy material effectively to all media outlets. Increasingly,
organizations and their marketing communications firms are looking for
cost-effective and efficient ways of reaching all of these media outlets.

Outsourcing of Communications Services. At the same time that new
technologies and new media outlets have rendered marketing communications more
complex, few organizations have developed the capacity to provide key marketing
communications services (including video production and distribution)
internally. Many organizations have also followed the trend of reducing their
marketing communications staffs and now often outsource these functions. Outside
service providers offer several advantages, including: the ability to reach a
greater share of the available media; the avoidance of costs such as hiring
additional staff; and the opportunity to act quickly by utilizing the outside
service providers' distribution channels that could take months or years to
develop internally.

THE COMPANY'S COMPETITIVE ADVANTAGES

The Company believes that it is strategically positioned to benefit from
industry trends because of its ability to provide a wide array of video and
audio production, distribution, monitoring and research services on a worldwide
basis. The Company's competitive advantages include its extensive operating
history with media outlets, key industry relationships, prominent client base,
combination of professional skills, ability to integrate new technology and
worldwide production and distribution capabilities.

Extensive Operating History with Media Outlets. The Company has completed

more than 10,000 projects over the course of its ten years of operations and, as
a result, has developed strong relationships with both television and radio
newsrooms worldwide. As evidenced by the frequent usage of its news releases by
media outlets, the Company believes that it has developed a reputation as a
reliable producer of newsworthy, broadcast-quality VNRs and ANRs. In addition,
the Company has created a proprietary database of information about more than
740 television stations, more than 2,300 radio stations in the U.S. and 300
other media outlets worldwide. This database contains historical usage patterns
of the stations, information preferences demonstrated by the stations' news
directors and editors and incorporates underlying demographic data describing
the audiences reached by each station.

Key Industry Relationships. The Company has established key relationships
with prominent news distribution and support services companies. For the past
nine years, the Company has benefited from an exclusive arrangement with the AP
for the use of its dedicated links to newsroom computers at television and,
recently, radio stations in the U.S., to notify stations of upcoming video and
audio satellite transmissions. This system is the largest advisory service for
satellite-delivered news, and is relied upon by television and radio stations
across the U.S. The Company also uses the AP for audio transmissions by
satellite. In addition, through an agreement with ABC Radio, the Company's audio
services reach more than 2,300 radio stations in the U.S. Medialink primarily
monitors domestic television station usage of VNRs, SMTs and live broadcast
events under an agreement with Nielsen Media Research and also uses Competitive
Media Reporting's monitoring services.

Prominent Client Base. The Company has provided its services to more than
1,100 clients worldwide over the last twenty-four months. The Company has
developed client relationships with such companies as AT&T, Columbia Tristar
Pictures, Federal Express, General Mills, Hasbro, Intel, MCI and Toyota. The
Company also works with the world's largest public relations firms,
not-for-profit organizations and government entities. The clients for the
Company's research and analysis services include corporations such as GTE,
General Motors, Kraft Foods, Miller Brewing and NYNEX. Repeat assignments from
established clients represented a significant portion of the Company's revenues
for fiscal 1995 and the nine months ended September 30, 1996, accounting for 63%
and 70%, respectively. The Company believes that the prominence of its client
base enhances its reputation among news professionals and helps it attract new
clients.

Combination of Professional Skills. The Company's staff is comprised of
professionals from the fields of public and investor relations, broadcast and
print journalism, production and distribution technology and media and marketing
research. This combination of skills enhances the Company's understanding of the
communications services industry and has enabled the Company to develop its
wide-ranging expertise. The

22
<PAGE>
public relations skills of its staff helps the Company to effectively articulate
the messages that its clients want to communicate. The broadcast and print
journalism background of its employees provides the Company with the ability to

translate the messages into video and audio content in a broadcast style that is
familiar to the news media and that can be easily integrated into news
programming. The production and distribution technology background of the
Company's operations staff contributes a broad understanding of newsrooms'
technical requirements which enables the Company to adapt its services to
changes in hardware and transmission systems. The media and marketing background
of the Company's research personnel enables Medialink to integrate sophisticated
market research techniques into its services.

Ability to Integrate New Technology. The Company's ability to integrate
new technology into its services significantly enhances its high-quality,
cost-effective services worldwide. Medialink adapts and implements new
technology through internal development and deployment, strategic alliances and
marketing and vendor agreements. Currently, the Company is experimenting with
digital video and audio transmission and retrieval systems. The Company
continuously monitors technological developments that have the potential to
enhance the value of its services.

Worldwide Distribution and Production. The Company offers its services on
a worldwide basis through all of its offices and through a network of 17
affiliates. The affiliates are independently owned companies which possess
production and marketing capabilities as well as demonstrated working
relationships with local media. All affiliates are trained in the Company's
methods of operation. In Asia, the Pacific Rim, South Africa and Latin America,
the affiliates market the Company's services and provide the Company's clients
with production, distribution and monitoring services. In Europe, the affiliates
market the Company's services to their own clients and provide production
services for the Company's clients.

STRATEGY

The Company's strategy is to maintain and leverage its leading position in
video distribution to become the premiere provider of production, distribution
and monitoring services for its clients' news across all media. The Company
believes that it can continue to broaden its communications services and reach
its strategic objective by (i) developing new services; (ii) leveraging its
client relationships by cross-marketing services to its clients; (iii)
continuing its global expansion; and (iv) pursuing acquisitions and strategic
alliances with companies that can add to the Company's service capabilities or
geographic scope. The following are the key elements of the Company's strategy:

Develop New Services. In recent years the Company has expanded its
services beyond its original video distribution and live broadcast services.
Video production, introduced in 1994, contributed 19% of revenues for the nine
months ended September 30, 1996; and research and analysis, and audio production
and distribution services, introduced in 1994 and 1996, respectively,
contributed 7% of revenues for the nine months ended September 30, 1996. The
Company developed its audio services to satisfy the demand of existing clients
and to offer its services to an expanded range of clients. With the PR Data
Acquisition in July 1996, the Company expanded its research capabilities and
added print news release distribution services. The Company is currently
developing digital video and audio distribution services for the Internet.

Leverage Client Relationships through Cross-Marketing. The Company's
client relationships typically begin with a single project, but often develop to
a point where a client may use several of the Company's services on multiple
occasions. The Company intends to leverage its client relationships by selling
its clients additional communications services, including the production of VNRs
and the production and distribution of ANRs. At present, fewer than 20% of the
Company's clients use its video production services and fewer than 2% use its
audio production and distribution services. The Company also intends to market
its expanded research and analysis service to its clients and to offer its
existing services to PR Data clients. Because production and research services
require a higher degree of collaboration between the Company and its clients and
are typically delivered over a longer period of time, the Company believes that
these services contribute to developing closer client relationships, thus
increasing the Company's opportunity to sell clients a broader range of
services.

Continue to Expand Globally. Since the Company established operations in
London, approximately 30% of the Company's annual revenue growth has been from
international operations. The Company has expanded and will continue to expand
its client base through aggressive marketing, the establishment of additional
sales

23
<PAGE>
offices in the U.S., the expansion of its international affiliate network,
particularly in Asia and the Pacific Rim, and the hiring of additional
personnel.

Pursue Acquisitions and Strategic Alliances. The Company operates within a
fragmented industry that includes competitors which do not have the resources to
take advantage of emerging technologies or to offer a full range of integrated
communications support services. At the same time, the Company believes that its
clients are increasingly demanding a full array of integrated services on a
worldwide basis. The Company believes that these trends will encourage
consolidation within the industry and create opportunities for acquisitions and
strategic alliances. No specific acquisitions are planned as of the date of this
Prospectus. There can be no assurance that the Company will be successful in
acquiring and then integrating acquired operations and personnel. See 'Risk
Factors.'

MEDIALINK CLIENTS AND SERVICES

The Company offers its clients a wide array of services which may be
purchased individually or in a customized package. The Company's services
include the following:

VIDEO SERVICES
------------------------------------

Video News Release Distribution
and Monitoring:
Domestic
International
Electronic Press Kits

Internet Delivery
(under development)

Live Broadcasts:
Satellite Media Tours
Special Event Broadcasts
Video Conferences

Video News Release Production:
Domestic
International

Public Service Announcements

AUDIO SERVICES
------------------------------------

Audio News Release Distribution
and Monitoring:
Domestic
International

Radio Media Tours
Audio Conferences
Public Service Announcements
Internet Delivery
(under development)

RESEARCH AND
ANALYSIS SERVICES
AND OTHER SERVICES
------------------------------------

News Coverage Analysis
Campaign Effectiveness
Assessment
Competitive Analysis
Performance Benchmarking
Press Release Distribution

<PAGE>
CLIENTS

The Company has a wide variety of clients, either directly or through the
client's marketing communications support firms. Clients range from Fortune 100
companies to trade associations, government entities and not-for-profit
organizations. Client relationships generally begin with a limited assignment
and have often grown to the provision of a variety of integrated services. The
following chart demonstrates the breadth of services that the Company offers to
a representative list of clients. Some of the clients listed are parent
companies of subsidiaries who use the Company's services. Unless otherwise
indicated, all of the clients listed in the table below are direct clients of
the Company. For the fiscal year ended 1995, no client accounted for more than
4% of the Company's revenues.

<TABLE>
<CAPTION>
CLIENTS SERVICES PROVIDED
- ----------------------------------------------- -------------------------------------------------------------------------
CORPORATIONS, TRADE ASSOCIATIONS VIDEO VIDEO LIVE RESEARCH
AND NOT-FOR-PROFIT ORGANIZATIONS DISTRIBUTION PRODUCTION BROADCAST AND ANALYSIS AUDIO PRINT
- ----------------------------------------------- ------------ ---------- --------- ------------ ----- -----
<S> <C> <C> <C> <C> <C> <C>
COMPUTER/ELECTRONICS
AT&T........................................... / / / / / /
Ameritech...................................... / / / /
Cable & Wireless............................... / / / /
Ericsson*...................................... / /
GTE............................................ / / / /
IBM............................................ / / / / / / / /
Intel.......................................... / /
Hewlett Packard................................ / / / /
MCI............................................ / / / / / / / /
Microsoft*..................................... / /
NYNEX.......................................... / / / /
Packard Bell*.................................. / /
Sega........................................... / / / /
Sony*.......................................... / / / / / / / / / /
Sprint*........................................ / /
ENTERTAINMENT
Buena Vista Home Video......................... / /
Castle Rock Entertainment...................... / / / /
Disney......................................... / /
MCA Universal.................................. / /
National Basketball Association................ / /
Time Warner*................................... / / / / / /
20th Century Fox............................... / / / / / /

CONSUMER PRODUCTS
Federal Express*............................... / / / / / /
General Mills*................................. / / / /
Hasbro*........................................ / / / /
Heinz*......................................... / / / / / /
Kraft Foods*................................... / / / / / / / / / /
Lever Brothers*................................ / / / /
Miller Brewing*................................ / / / / / / / /
Pepsi*......................................... / / / / / / / /
Phillip Morris*................................ / /
VISA USA....................................... / / / /
HEALTH AND PHARMACEUTICAL
Abbott Laboratories*........................... / / / /
Ciba Geigy/Sandoz.............................. / / / /
Glaxo-Wellcome*................................ / /
Janssen Pharmaceutica*......................... / /
Johnson & Johnson.............................. / / / / / /
Merck*......................................... / / / / / /
Smith Kline/Beecham*........................... / / / /
</TABLE>

(table continued on next page)

25
<PAGE>

PUBLIC RELATIONS FIRMS
- -----------------------------------------------
Burson-Marsteller.............................. / / / / / /
Edelman Public Relations Worldwide............. / / / /
Fleishman-Hillard.............................. / / / /
Golin/Harris................................... / / / /
Hill & Knowlton................................ / / / /
Ogilvy Adams & Rinehart........................ / / / / / /
Porter/Novelli................................. / / / / / /
Shandwick Group................................ / / / / / /

INDEPENDENT PRODUCERS
- -----------------------------------------------
Corporate Television Group..................... / / / /
Perri Productions.............................. / /
Robert Chang Productions....................... / /
Washington Independent Productions............. / / / / / /

GOVERNMENT AGENCIES/NOT-FOR-PROFIT
ORGANIZATIONS
- -----------------------------------------------
American Assoc. of Retired Persons............. / / / /
British Department of the Environment.......... / / / /
European Commission............................ / / / /
Labor Institute for Public Affairs
(AFL-CIO)*................................... / / / / / /
National Institutes of Health.................. / /
U.S. Dept. of Labor............................ / /
U.S. Federal Reserve........................... / / / /
U.S. Fish & Wildlife Service................... / /
</TABLE>

- ------------------
* Some or all of the projects were received indirectly through a marketing
communications firm or an independent producer.

SERVICES

Video Services

Each of the Company's video services is composed of a combination of three
basic elements: notification, distribution and monitoring. Notification is the
process of informing newsrooms that material will be available, when it will be
available and how it will be delivered. Distribution is the process of
delivering the material, usually by satellite. Monitoring is the process of
collecting data on its usage and analyzing and reporting that usage back to the
client.

VNR Distribution. VNRs are the video equivalents of a conventional press
release and are used for the same purposes, such as to introduce a new product
or service, explain a technological breakthrough, communicate during a crisis or
advocate a position on an issue of public concern. VNRs are produced on
deadlines ranging from a few hours to a few weeks. VNRs are distributed to
broadcasters and formatted in broadcast-news style for easy integration, in

complete or edited form, into television and cable news programs. A VNR package
(fully narrated story with announce track) usually runs from 90 seconds to two
minutes. A VNR

26
<PAGE>
package also includes, in certain cases, B-roll (supplemental video to help
television news producers customize the story), which may also be distributed
separately.

An example of a VNR project distributed domestically and monitored by the
Company is Pepsi's broadcast campaign to counter rumors that syringes had been
found in soft drink cans. Pepsi produced four VNRs which aired in one week and
countered the rumors by showing the viewing public how difficult it would be to
tamper with the canning process. The Company's electronic monitoring indicated a
cumulative audience of 488 million over the one-week period, including airings
on ABC, NBC, CBS, CNN and CNBC.

The price for the domestic distribution and monitoring of a VNR typically
ranges from approximately $4,500 to $10,000, depending on project
specifications. The price for international distribution and monitoring of a VNR
typically ranges from approximately $8,000 to $30,000, depending on project
specifications.

VNR Production. The Company also produces VNRs. The VNR production process
begins with a consultation between the client and a Company producer following
which the producer and the client agree on the concept, a deadline and a
production budget. The producer prepares a script, schedules a freelance camera
crew, edits the videotape and submits it for client approval prior to
distribution.

The Company produced and distributed a VNR for the Hard Rock Cafe of the
opening of the Hard Rock Hotel and Casino in Las Vegas. The Company's electronic
monitoring indicated a cumulative audience of more than 36 million from 190
airings on 137 television stations or network news programs, including CNN, Hard
Copy, Inside Edition, WWOR, WABC in New York, KNBC in Los Angeles, WLS in
Chicago, WCAU in Philadelphia, WCVB in Boston, KDFW and WFAA in Dallas, KTRK in
Houston and WJW in Cleveland.

The price for domestic distribution and production of a VNR typically
ranges from approximately $9,000 to $30,000, depending on project
specifications. The price for international distribution and production of a VNR
typically ranges from approximately $12,000 to $40,000, depending on project
specifications.

Electronic Press Kits. The Company also produces and distributes
Electronic Press Kits (EPKs) for entertainment clients. EPKs are longer version
VNRs promoting upcoming feature films and home video cassettes which are
distributed to entertainment reviewers and reporters at television stations for
airing as part of their film reviews. EPKs include a trailer previewing scenes
from the film, location shots of the film sets and interviews of the stars and
director.

Buena Vista Pictures retained the Company in June 1996 to distribute an EPK
to promote the opening of The Hunchback of Notre Dame. The Company's monitoring
of the EPK indicated a cumulative audience of more than 47 million on more than
500 television news broadcasts. Portions of the EPK aired on networks and
stations such as CNN, WWOR in New York, KABC and KCBS in Los Angeles, WBBN and
WGN in Chicago, WPVI in Philadelphia, KRON in San Francisco, WMUR in Boston,
WJLA and WRC in Washington, DC and WFAA in Dallas.

The price for EPK production and distribution typically ranges from
approximately $7,500 to $25,000, depending on project specifications.

Live Broadcast Services. Live broadcast services include Satellite Media
Tours (SMTs), news conferences and special-event broadcasts. SMTs consist of a
sequence of one-on-one satellite interviews with a series of pre-booked
television reporters typically at 12 to 20 stations across the country or around
the world. Typical SMT applications include, among others, an interview with a
celebrity or author promoting an upcoming event, product, movie or book release.
SMTs generally are conducted from a studio but can originate from remote
locations. SMTs may be aired live by the television station or recorded for
later airing.

An example of a SMT coordinated by the Company was the American Egg Board's
promotion of the benefits of eggs in the diet featuring a National Football
League star. The Company's monitoring of the SMT indicated a cumulative audience
of 3.3 million. Portions of the SMT aired on 20 television stations or cable
systems, including WNBC in New York, Newschannel 8 in Washington, DC, KTVU in
San Francisco, WAGA in Atlanta, WEWS in Cleveland, WTHR in Indianapolis and WTNH
in Hartford.

The price for a SMT typically ranges from approximately $9,000 to $21,000,
depending on project specifications.

27
<PAGE>
Other live broadcast services include interviews, news conferences and
interactive video conferences. Examples of these include: coverage from the
floor the New York Stock Exchange of the first day of trading of Revlon's shares
and production of a major international video conference for Johnson & Johnson,
featuring primary speakers in Orlando, Florida, an interactive presentation from
a speaker in Zurich, Switzerland, as well as elements from news programs that
originated in many of the conference participants' home countries.

The price for live broadcast distribution ranges from approximately $10,000
to $200,000, depending on project specifications.

Audio Services

ANRs. ANRs are used for the same purposes as VNRs. ANRs are distributed to
radio stations for news, public affairs and 'talk radio' programs. ANRs are
produced on deadlines ranging from less than an hour to several days. ANRs are
produced for easy integration into a station's programming and are formatted for

their use in complete or edited form. Usage monitoring is conducted by telephone
surveys, traditional clipping services that monitor radio news in selected major
markets and an automated digital telephone retrieval system.

An example of an ANR produced and distributed by the Company was the
promotion of the initial availability of Nicotrol(Registered), an
over-the-counter nicotine patch distributed by McNeil Consumer Products.
Monitoring of the ANR indicated a cumulative audience of 3.8 million for
portions of the ANR from airings on 102 stations or networks nationwide
including Bloomberg Business News and in major markets such as New York,
Chicago, Boston, Detroit, Houston, Atlanta, Cleveland and Baltimore.

The price for domestic production and distribution of an ANR typically
ranges from approximately $3,500 to $5,500, depending on project specifications.
The price for international production and distribution of an ANR typically
ranges from approximately $10,000 to $20,000, depending on project
specifications.

RMTs. Medialink also offers RMTs. Similar to SMTs, RMTs consist of a
sequence of one-on-one interviews with a series of pre-booked radio stations
across the country or around the world. RMTs generally are conducted by
telephone from a studio, often in conjunction with a SMT. In October 1996 the
Company produced a RMT for 20th Century Fox in which actor Tom Hanks promoted
his new feature film 'That Thing You Do.' The RMT originated from the Company's
digital radio studio in its New York office. The monitoring of this RMT
indicated a cumulative audience of 1.4 million. The RMT was aired nationwide,
including radio stations in New York, Chicago, San Francisco, Detroit, Dallas,
Washington, Miami, Atlanta, Seattle, San Diego and Minneapolis.

The price for a RMT typically ranges from approximately $4,900 to $6,900,
depending on project specifications.

Research and Analysis Services

Through its Medialink Public Relations Research division, the Company
provides customized studies which clients use to gauge the effectiveness of
their public relations efforts. Based on data provided by electronic monitoring
and press clipping services, the Company uses statistical analyses to measure
the quantity and quality of the client's print and broadcast news coverage. The
reports include a digest of newspaper, magazine and broadcast coverage;
circulation and viewership totals; a qualitative scoring of the tone and content
of the coverage; and, upon request, an estimate of the price that equivalent
exposure would have cost if paid advertising were used.

Medialink also offers interpretive analyses that provide an overall
appraisal of the efficiency and impact of a client's communications efforts; a
comparison of the client's news coverage with that of its competitors; a
benchmark against which future efforts can be measured; and a gauge of return on
investment for marketing communications programs. In some cases the Company
conducts field research, interviewing journalists to ascertain their attitudes
toward a client company. Certain projects require the Company to survey the
public to determine how a client's reputation may have been affected by the
client's public relations efforts. Clients use these reports to continually
refine their public relations programs.

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<PAGE>
The division's clients include AT&T, General Motors, GTE, Miller Brewing,
Kodak, Nynex and Kraft Foods. Research and analysis projects vary widely in
price depending on specifications and can range in price from $5,000 for a
single project to an annual retainer of $200,000.

Other Services. Medialink's other services include production and
distribution of Public Service Announcements (PSAs), distribution of photographs
and other graphic material to television stations and the distribution of
conventional press releases. PSAs are video messages in the public interest,
generally produced for non-profit organizations, that are aired by television
stations as a public service. The Company also transmits still photos or
graphics that are distributed with a press release to visually enhance the story
and are used as illustrations in newscasts while a news announcer reads the
story. Medialink also provides print distribution services, which includes the
distribution of conventional press releases via facsimile and mail.

Services Under Development. The Company is experimenting with an Internet
audio service called 'Medialink News Now.' The Company posts digital audio files
at www.medialinkvideonews.com. Although the service is intended primarily for
radio stations, any computer user with the appropriate equipment can retrieve
broadcast-quality audio from this Web site. In addition, the Company is testing
various technologies that might provide the basis for a service that delivers
video via the Web. This experiment could evolve into a system that allows
television stations to preview VNRs.

CASE STUDIES

The following case studies illustrate the Company's marketing
communications solutions for certain of the Company's clients, in each case
indicating the message to be conveyed to the public, the manner in which the
Company's services were employed and the results the services achieved.

General Mills. The Betty Crocker Products division of General Mills sought
to generate maximum publicity for a complete makeover of Betty Crocker, a
consumer icon celebrating its 75th anniversary. General Mills had, periodically,
updated the look of this fictional character in order to keep the symbol of the
Betty Crocker brand contemporary. Along with a wide range of public relations
activities undertaken by the client to maximize consumer awareness of the
brand's changes, the client employed a suite of video services, including a live
satellite transmission of the introduction ceremony, a SMT and a VNR.

The live broadcast was hosted by a key brand manager for the Betty Crocker
brand, who introduced the artists and several of the 75 women who inspired the
new composite Betty Crocker portrait. Corporate executives discussed the brand's
heritage and demonstrated how Betty Crocker's appearance had changed over the
years. Immediately following this event, Medialink coordinated a SMT during
which newscasters from 23 stations interviewed the artist and the brand
executive. In addition, video from the introduction ceremony was incorporated
into a VNR that was carried by major-market television stations and on ABC's
'Good Morning America' and 'World News Tonight.'

The Company's monitoring of the live broadcast, SMT and VNR indicated a
cumulative audience of 42 million. This project demonstrates the Company's
ability to orchestrate several of its services in a manner intended to amplify
the public exposure of a significant corporate event.

Web-TV. In July 1996 Web-TV introduced the first product to provide
consumers with access to the Internet via household television sets. The system
is based on a set-top box manufactured by Sony and Philips that allows users to
navigate the Web with a device that resembles a television remote control.
Medialink produced a VNR in which the company's founder demonstrated the system
and coordinated a SMT that was featured on the news broadcasts of 21 stations,
as well as CNNfn. To broaden exposure for this development, Medialink created an
ANR using the audio component of the television release. The ANR was carried by
all-news radio stations in New York, Los Angeles and Philadelphia, among others.

The Company's monitoring of the VNR, SMT and ANR indicated a cumulative
audience of 24.8 million. This project demonstrates Medialink's ability to
produce material for one medium and readily adapt it to others, in this instance
from television to radio.

Speedo International. Speedo International, a major manufacturer of
aquatic sporting gear, sought to capitalize on the interest in competitive
swimming surrounding the 1996 summer Olympics, as it introduced a

29
<PAGE>
new line of swimsuits. The swimsuits were made from Aquablade(Registered), a
proprietary material, that, according to scientific tests reported by Speedo,
added as much as 8% to a swimmer's speed.

The client sought television news coverage in Europe, Australia and Latin
America. Medialink's London office coordinated the production of a VNR, which
included footage of scientific testing, 3-D computer animation and underwater
photography. Segments were produced using athletes from various countries and in
various languages so that broadcasters could select an interview to give the
story a local appearance. The VNR was distributed through Medialink's affiliate
network.

The Company's monitoring of the VNR indicated a cumulative audience of 174
million in 12 countries. This project demonstrates the Company's ability to
support a client's global requirements and to provide appropriate material to
media in several countries around the world.

DISTRIBUTION AND MONITORING SYSTEMS

Video. The Company provides VNR notification advisories to U.S. television
newsrooms through the exclusive AP Express/Medialink Newswire. These
notification advisories include a description and script of the VNR, as well as

the technical satellite transmission information needed by stations to receive
the material. Medialink typically distributes the VNR by satellite transmission
or by fiber optic cable. To monitor domestic broadcasts of VNRs, the Company
encodes each transmission using technologies provided by Nielsen Media Research
and Competitive Media Reporting. This encoding enables Nielsen Media Research
and Competitive Media Reporting to electronically monitor the broadcasts.
Monitoring data is then analyzed by the Company and combined with relevant
additional information collected by Medialink, audience ratings from Nielsen
Media Research and audience demographics. Medialink packages this information
for the client into daily monitoring reports for the first five days after a VNR
is distributed. Reports are then provided on a weekly basis for the next three
weeks and a final comprehensive report is presented to the client five weeks
after the VNR's distribution.

The Company coordinates international distribution through its London
office. Notification advisories are provided by broadcast fax and telephone.
Distribution is primarily by satellite, although most international VNR
distributions also require cassette delivery by overnight courier. The Company
monitors international broadcasts through a combination of telephone surveys and
analysis of clipping services data.

The Company uses the AP Express/Medialink Newswire, faxes and telephone
calls to notify television stations of the availability of a SMT. SMTs are
conducted by satellite. The Company's media relations department schedules
interviews with each of the stations participating in the SMT. SMTs are
monitored in the same manner as are VNRs.

Audio. The Company uses the AP Express/Medialink Radio Newswire, broadcast
fax and telephone calls, as appropriate, to notify more than 2,300 radio
stations. This group of stations includes virtually all radio stations with
significant news or talk-centered programming. Medialink uses the satellite
transmission facility of the AP to transmit ANRs and RMTs to stations that
subscribe to this AP service.

Medialink also has an agreement with ABC Radio for the satellite
transmission of ANRs. ABC Radio offers this service on a common-carrier basis
which allows for the receipt of this material by ABC Radio network affiliates
and otherwise unaffiliated stations. Medialink also stores and distributes ANRs
on a digital system that can be called by radio stations using a toll-free
number. ANR monitoring is performed by telephone surveys, by analyzing data
provided by third party monitoring services and tabulating station calls to the
digital system.

The Company distributes RMTs in the U.S. by telephone. The scheduling of
interviews with stations is arranged by the Company's media relations
department. RMTs are monitored by the Company in the same manner as it monitors
ANRs.

Other. The Company continues to enhance its existing, and develop new,
electronic distribution capabilities by employing and integrating new
technology. The Company intends to capitalize on the commercial development of
the Internet as a promotional tool and as an additional distribution channel.
The Company created a Web site which contains the Company's promotional and
educational material (www.medialinkworldwide.com). The Company has also created

an additional Web site for broadcast journalists, editors and producers which
contains notification information and links to other Web sites with more
in-depth information concerning the Company's clients and their communication
releases (www.medialinkvideonews.com).

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<PAGE>
Currently, the Company is developing Internet audio services. In addition, the
Company is testing other Internet technologies to expand its video service
offerings.

SALES AND MARKETING

As of October 1, 1996 the Company employed a team of 31 sales, marketing
and sales support personnel in seven U.S. offices and in London. Services are
also marketed internationally by the Company's 17 affiliates located in Europe,
Asia, the Pacific Rim, South Africa and Latin America. Each salesperson receives
a base salary but is compensated primarily through a commission structure that
is based on sales volume and profitability. Each salesperson participates in
ongoing training programs in sales techniques and communications technology.
Details regarding the Company's operations by geographic area are included in
Note 6 to the Company's Financial Statements.

The sales force concentrates on cultivating long-term relationships with
clients. Certain sales personnel specialize in particular industries, such as
the pharmaceutical or high-tech industries, developing an in-depth knowledge of
the industry. The support personnel screen prospects so that the sales personnel
can focus their efforts on presenting the Company's services in an appropriate
manner. Sales personnel are trained to represent all of the Company's service
offerings and are encouraged to create opportunities to sell multiple services.

The Company's marketing programs are designed to position the Company as a
leading provider of integrated video, audio and research services.
Company-sponsored workshops, typically attended by 60 clients and potential
clients, are central to the Company's marketing efforts. At these workshops,
outside authorities and Company personnel make presentations concerning current
developments in the news and public relations industries. In addition, the
Company is able to discuss its services and demonstrate how these services can
serve the needs of workshop attendees. The workshops are held around the world
and cover such subjects as combining radio and television techniques;
international opportunities; and obtaining news exposure for health and medical
projects. Management believes that these workshops are an efficient way to
strengthen the bonds between its sales force and its clients, and that this has
contributed to the increase in the average revenues per salesperson/sales
assistant from $347,000 in 1993 to $506,000 in 1995. The Company also uses
brochures, video tapes, advertisements in trade publications and its Web sites
as marketing tools.

COMPETITION

although no single company competes across all service lines. Many of the
Company's competitors or potential competitors have longer operating histories,
longer client relationships and significantly greater financial, management,
technological, sales, marketing and other resources than the Company. In
addition, clients could perform internally all or certain of the services
provided by the Company rather than outsourcing such services. The Company
expects that competition will increase substantially as a result of industry
consolidations and alliances, as well as through the emergence of new
competitors. The Company believes that the market for communications services
may become increasingly concentrated in the future as a result of the
acquisition and integration of smaller service providers, which are likely to
permit many of the Company's competitors to devote significantly greater
resources to the development and marketing of new competitive products and
services. There can be no assurance that existing or future competitors will not
develop or offer services that provide significant performance, price, creative
or other advantages over those offered by the Company. The Company could face
competition from companies in related communications markets which could offer
services that are similar or superior to those offered by the Company. In
addition, national and regional telecommunications providers could enter the
market with materially lower electronic delivery costs, and radio and television
networks could also begin transmitting business communications separate from
their news programming. The Company's ability to maintain and attract clients
depends to a significant degree on the quality of services provided and its
reputation among its clients and potential clients as compared to that of
competitors. There can be no assurance that the Company will not face increased
competition in the future or that such competition will not have a material
adverse effect on the Company's business, operating results and financial
condition. See 'Risk Factors.'

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EMPLOYEES

As of October 1, 1996, the Company had approximately 103 employees
including 56 in operations, 31 in sales and marketing and 18 in administration.
None of the Company's employees is represented by a labor union. Management
believes that its employee relations are good. The Company also engages on a
part-time, project-by-project basis, independent production crews at various
locations worldwide. These crews have the skills, training and experience which
the Company requires for its production services.

The Company's staff of professionals come from a variety of backgrounds in
the fields of public and investor relations, broadcast and print journalism,
production and distribution technology and media and marketing research. As a
result of downsizing in the broadcast journalism industry, the Company has been
able to attract experienced personnel from this industry. The Company seeks and
hires staff with appropriate credentials and relevant experience in the fields
of journalism, media and marketing, video and audio production, distribution,
research and analysis, and public and investor relations services. Personnel
have experience with organizations including ABC News, CBS News, the BBC, Time
Warner, Dow Jones, The New York Times, PR Newswire, Knight Ridder, United Press
International, CNBC, The Times of London and Edelman Public Relations Worldwide.

FACILITIES

The Company's New York City headquarters consist of approximately 15,000
square feet of leased space and the Company's international office located in
London, England, consists of approximately 1,500 square feet of leased space.
The Company also maintains leased offices in Washington, D.C.; Los Angeles,
California; Chicago, Illinois; Norwalk, Connecticut; Dallas, Texas and Atlanta,
Georgia. The Company believes that its facilities are adequate to meet its
current requirements.

LEGAL PROCEEDINGS

The Company is not a party to any material legal proceedings.

<PAGE>
MANAGEMENT

EXECUTIVE OFFICERS AND DIRECTORS

The executive officers and directors of the Company are as follows:

<TABLE>
<CAPTION>
NAME AGE POSITION
- ------------------------------------------ --- ---------------------------------------------------------------
<S> <C> <C>
Laurence Moskowitz........................ 45 Chairman of the Board, President and Chief Executive Officer
J. Graeme McWhirter....................... 40 Executive Vice President, Chief Financial Officer and Assistant
Secretary
David Davis............................... 60 Senior Vice President/International, Director
Nicholas F. Peters........................ 45 Senior Vice President/Operations
Mark Manoff............................... 44 Senior Vice President/Sales
Mark Weiner............................... 41 Vice President/Research and Media Relations
Mary Buhay................................ 31 Vice President/Sales and Special Services
Harold Finelt(1)(2)(3).................... 36 Director
Donald Kimelman(2)(3)..................... 49 Director
James J. O'Neill(1)....................... 58 Director
Gerald P. Rodeen.......................... 49 Director
Theodore Wm. Tashlik(2)(3)................ 56 Director
</TABLE>

- ------------------
(1) Member of the Audit Committee
(2) Member of the Compensation Committee
(3) Member of the Stock Option Committee

Laurence Moskowitz, the founder of Medialink, has served as Chairman,
President and Chief Executive Officer of the Company since its inception in
1986. He began his professional career as a reporter for United Press
International in Pittsburgh before being promoted to an editor for UPI in
Philadelphia. In 1976 Mr. Moskowitz founded Mediawire, a Philadelphia-based
regional public relations newswire which was merged into PR Newswire, a unit of
United News & Media plc, where he was Vice President until leaving to form
Medialink.

J. Graeme McWhirter, a co-founder of Medialink, has served as Chief
Financial Officer since 1986 and has been Executive Vice President since 1992.
From 1984 to 1988, Mr. McWhirter was Executive Vice President and Chief
Financial Officer of Commonwealth Realty Trust, a publicly quoted Real Estate
Investment Trust. From 1976 to 1984, Mr. McWhirter was with KPMG Peat Marwick in
London and Philadelphia as a manager.

David Davis has been a member of Medialink's Board of Directors since
September 1992 and in 1996 became Senior Vice President/International. From
September 1992 to the date of this offering, The Davis Partnership, a
partnership beneficially owned by Mr. Davis, served as a consultant to the
Company. From 1968 to 1992, Mr. Davis was employed by Edelman Public Relations

Worldwide. During such period, Mr. Davis was a manager responsible for Europe
and Asia Pacific and served as Vice Chairman at Daniel J. Edelman, Inc. From
1951 to 1968, Mr. Davis was a journalist for Britain's national Press
Association, Universal News Services (Britain's first business newswire), and
the Times of London.

Nicholas F. Peters has served as Senior Vice President/Operations since
January 1996. From April 1992 to January 1996, Mr. Peters was Vice
President/Operations and from October 1987 to April 1992, he was Executive
Editor and then Vice President/Sales & Marketing. From April 1983 to October
1987, Mr. Peters was a newswriter and producer at CBS News, working with Dan
Rather and Charles Osgood. From May 1979 to April 1983, he was News Director at
WHYY, the National Public Radio affiliate in Philadelphia. From February 1973 to
May 1979, he was a newspaper reporter with the Indianapolis Star, Raleigh (N.C.)
Times and Philadelphia Bulletin.

Mark Manoff has served as Senior Vice President/Sales since January 1996.
From April 1992 to January 1996, Mr. Manoff served as Vice President/Sales and
from February 1989 to April 1992 he served as its Vice President/Operations. Mr.
Manoff opened Medialink's Washington, D.C. office in November 1987 and served as
its general manager until February 1989. Mr. Manoff was chief political
correspondent for the Philadelphia Daily News from January 1979 to March 1983.
Mr. Manoff served as a political consultant in New York and

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<PAGE>
Washington from March 1983 to January 1986 and was an editor in the Dow Jones
Community newspaper group.

Mark Weiner joined Medialink in September 1994 as Vice President/Research
and Media Relations. From April 1986 to September 1992, Mr. Weiner served as a
Managing Partner of PR Data. From September 1992 to September 1993, Mr. Weiner
served as Senior Vice President of Copernicus: The Marketing Investment Strategy
Group, a marketing and research consultancy. He was a columnist with McNaught
Newspaper Syndicate and the New York Times News Service from 1979 to 1984.

Mary Buhay has served as Vice President/Sales and Special Services since
July 1996. Ms. Buhay joined Medialink in March 1993 as Sales Manager, in October
1993 she was promoted to New York Bureau Manager and in August 1995 she was
appointed Associate Vice President for eastern and mid-western sales. From 1988
to 1993, Ms. Buhay held sales management positions in the news and advertising
division of Radio TV Reports, a broadcast research firm owned by the Arbitron
Company.

Harold Finelt has served as a director of the Company since 1987. Mr.
Finelt joined American Research & Development, a private venture capital firm,
as an associate in 1986 and he has been a Vice President of such firm since
1990. He is a general partner of American Research & Development's venture funds
and a general partner of Hospitality Technology Funds, L.P.

Donald Kimelman has served as a director of the Company since 1987. Mr.
Kimelman has been the Pennsylvania editor of the Philadelphia Inquirer
responsible for supervising state and suburban coverage since January 1996. Mr.
Kimelman worked for the Annapolis Evening Capital and the Baltimore Sun prior to

joining The Philadelphia Inquirer. At the Inquirer, he had local, national,
foreign and investigative assignments prior to becoming an editor. From 1981 to
1983, he was a national correspondent and from 1983 to 1987 he was Moscow bureau
chief. Mr. Kimelman was deputy editor of the editorial page of The Philadelphia
Inquirer from 1987 to 1993 and became foreign editor in August 1994.

James J. O'Neill has served as a director of the Company since 1994. Since
1995 he has acted as a private financial consultant. From 1990 to 1995 Mr.
O'Neill served as a Senior Vice President of Rothschild Inc.

Gerald P. Rodeen has served as a director of the Company since 1986. Mr.
Rodeen has been a partner of the law firm of Dilks, Rodeen, Gibson & Smith Ltd.
for more than five years.

Theodore Wm. Tashlik has served as a director of the Company since 1992.
Mr. Tashlik has been a member of the law firm of Tashlik, Kreutzer & Goldwyn
P.C., which represents the Company in certain matters, for more than five years.

COMMITTEES OF THE BOARD OF DIRECTORS

The Board has standing Audit, Compensation and Stock Option Committees. The
Audit Committee consists of Harold Finelt and James J. O'Neill and the
Compensation and Stock Option Committees consists of Harold Finelt, Donald
Kimelman and Theodore Wm. Tashlik. The Audit Committee makes recommendations
concerning the engagement of independent public accountants, reviews with the
independent public accountants the plans and results of the audit engagement,
reviews the independence of the independent public accountants, considers the
range of audit and non-audit fees and reviews the adequacy of the Company's
internal controls. The Compensation Committee is responsible for establishing
salaries, bonuses, and other compensation for the Company's officers, and the
Stock Option Committee is responsible for administering the Company's stock
option plans.

CLASSIFICATION OF BOARD OF DIRECTORS

The seven directors comprising the Board of Directors are divided into
three classes, each class with as equal a number of directors as possible.
Messrs. Rodeen and O'Neill constitute Class I and will stand for election at the
annual meeting of stockholders to be held in 1997. Messrs. Tashlik and Davis
constitute Class II and will stand for election at the annual meeting of
stockholders to be held in 1998. Messrs. Finelt, Kimelman and Moskowitz
constitute Class III and will stand for election at the annual meeting of
stockholders to be held in 1999. After their initial term following the
offering, directors in each class will serve three year terms. All directors
will serve until successors have been duly elected and qualified. Officers are
chosen by and serve at the discretion of the Board of Directors. There are no
family relationships among the directors and executive officers of the Company.

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<PAGE>
COMPENSATION OF DIRECTORS

Directors do not receive any compensation for their services. Directors
receive reimbursements of expenses incurred in attending meetings and are
eligible to participate in the Company's Directors Stock Option Plan. The
Directors Stock Option Plan provides that each non-employee director shall
automatically be granted options to purchase 3,000 shares of Common Stock upon
his election as a director, at an exercise price equal to the fair market value
of the Common Stock. Thereafter, each non-employee director shall be granted
options to purchase 3,000 shares of Common Stock on the anniversary of the
election or appointment of such director. Through the date hereof the Company
has granted non-qualified options to purchase an aggregate of 62,400 shares of
Common Stock to the directors at an exercise price of $3.54 per share.

EXECUTIVE COMPENSATION

The following table shows compensation paid for the year ended December 31,
1995 to (i) the Chief Executive Officer and (ii) the Company's four other most
highly compensated individuals who were serving as officers on December 31, 1995
and whose salary plus bonus exceeded $100,000 for the year ended December 31,
1995 (collectively, the 'Named Executive Officers').

<TABLE>
<CAPTION>
LONG-TERM
COMPENSATION
AWARDS
------------
ANNUAL COMPENSATION SECURITIES
----------------------------- UNDERLYING
NAME AND PRINCIPAL POSITION SALARY ($)(1) BONUS ($)(1) OPTIONS (#)
- --------------------------------------------------------------------- ------------- ------------ ------------
<S> <C> <C> <C>
Laurence Moskowitz
Chairman of the Board,
President and Chief Executive Officer.............................. $ 132,203 $ 24,000 9,600
J. Graeme McWhirter
Executive Vice President,
Chief Financial Officer and Assistant Secretary.................... 118,926 6,000 8,400
Nicholas F. Peters
Senior Vice President/Operations................................... 100,983 8,200 7,200
Mark Manoff
Senior Vice President/Sales........................................ 101,699 8,200 7,200
Mary Buhay
Vice President of Sales/Special Services........................... 47,351 70,455(2) 3,600
</TABLE>
- ------------------
(1) All figures are rounded down to the nearest whole dollar.
(2) Includes sales commission of $70,255.

OPTION GRANTS IN LAST FISCAL YEAR

The following table contains information concerning stock option grants
made to each of the Named Executive Officers in 1995. No stock appreciation
rights were granted to these individuals during such year.

<TABLE>
<CAPTION>
POTENTIAL
REALIZABLE
INDIVIDUAL GRANTS (1) VALUE AT ASSUMED
-------------------------------------------------------- ANNUAL RATES OF
NUMBER OF PERCENT OF STOCK PRICE
SHARES TOTAL OPTIONS APPRECIATION FOR
UNDERLYING GRANTED TO EXERCISE OPTION TERM(3)
OPTIONS EMPLOYEES IN PRICE PER EXPIRATION ------------------
NAME GRANTED(#) FISCAL YEAR(2) SHARE DATE 5%($) 10%($)
- ---------------------------------------- ----------- -------------- --------- ---------- ------- -------
<S> <C> <C> <C> <C> <C> <C>
Laurence Moskowitz...................... 9,600 12.8% $2.29 6/30/2005 $35,810 $57,021
J. Graeme McWhirter..................... 8,400 11.2 2.29 6/30/2005 31,333 49,893
Nicholas F. Peters...................... 7,200 9.6 2.29 6/30/2005 26,857 42,766
Mark Manoff............................. 7,200 9.6 2.29 6/30/2005 26,857 42,766
Mary Buhay.............................. 3,600 4.8 2.29 6/30/2005 13,429 21,383
</TABLE>

(Footnotes on next page)

35
<PAGE>
(Footnotes from previous page)
- ------------------
(1) These options have a term of 10 years, subject to earlier termination upon
certain events related to termination of employment and amendment or
termination of the Plan. Each of these options was granted at an exercise
price equal to the estimated fair market value of the underlying stock on
the date of the grant, as determined by the Board of Directors. The option
shares vested 20% on the date of grant and will vest 20% on each anniversary
date thereafter.
(2) Based on options granted for an aggregate of 75,000 shares during the year
ended December 31, 1995.
(3) The 5% and 10% assumed compounded annual rates of stock price appreciation
are mandated by rules of the Securities and Exchange Commission. There can
be no assurance provided to any executive officer or any other holder of the
Company's securities that the actual stock price appreciation over the
ten-year option term will be at the assumed 5% and 10% levels or at any
other defined level. Unless the market price of the Common Stock appreciates
over the option term, no value will be realized from the option grants made
to the Named Executive Officers.

OPTION EXERCISES AND FISCAL YEAR-END VALUES

The following table sets forth information concerning option exercises and
option holdings for the year ended December 31, 1995 with respect to each of the
Named Executive Officers. No Named Executive Officers exercised any options
during such year.

AGGREGATE OPTION EXERCISES IN LAST FISCAL YEAR
AND FISCAL YEAR-END OPTION VALUES

<TABLE>
<CAPTION>
NUMBER OF SHARES
UNDERLYING UNEXERCISED VALUE OF UNEXERCISED
OPTIONS ON DECEMBER 31, IN-THE-MONEY OPTIONS ON
1995(#) DECEMBER 31, 1995 ($)(1)
---------------------------- ----------------------------
NAME EXERCISABLE UNEXERCISABLE EXERCISABLE UNEXERCISABLE
- ----------------------------------------------------------- ----------- ------------- ----------- -------------
<S> <C> <C> <C> <C>
Laurence Moskowitz......................................... 10,560 8,340 $22,186 $11,111
J. Graeme McWhirter........................................ 10,320 7,380 21,886 9,911
Nicholas F. Peters......................................... 8,160 6,240 17,189 8,299
Mark Manoff................................................ 8,160 6,240 17,189 8,299
Mary Buhay................................................. 720 2,880 900 3,600
</TABLE>

- ------------------
(1) Based on the fair market value of the Company's Common Stock at December 31,
1995, of $3.54 per share (as determined by the Company's Board of Directors)
less the exercise price payable for such shares.

EMPLOYMENT CONTRACTS

Each of the Company's executive officers has entered into an employment
agreement with the Company which commences on the date of the closing of this
offering.

The employment agreements with Messrs. Moskowitz and McWhirter provide for
an annual base salary of not less than $150,000 and $135,000, respectively, plus
a bonus to be awarded annually at the discretion of the Compensation Committee.
The employment agreements have a term of three years.

The employment agreements with Messrs. Peters, Manoff and Ms. Buhay provide
for annual base salaries of not less than $108,500, $108,500 and $80,000,
respectively, plus bonuses to be awarded annually at the discretion of the
Compensation Committee. In addition, Ms. Buhay is entitled to receive certain
sales commissions. The employment agreements have a term of two years.

The employment agreement with Mr. David Davis provides for an annual base
salary of $135,000 plus a bonus based upon the Company's European pre-tax
profits as compared to targeted levels. The employment agreement has a term of
two years. Prior to the effectiveness of such agreement, Mr. Davis was a partner
in a consultant to the Company. See 'Certain Transactions.'

The employment agreements entitle these executive officers to participate
in the health, insurance, pension and other benefits, if any, generally provided
to employees of the Company.

The employment agreements contain covenants prohibiting the solicitation of

employees and the solicitation of clients and vendors during certain periods and
covenants prohibiting the improper disclosure of confidential information at any
time. The employment agreements also provide that the executive officer, with
certain exceptions, until two years after the termination of his or her
employment with the Company, would not participate in any capacity in any
business activities with respect to the production of video and audio public

36
<PAGE>
relations materials for distribution to news media, the distribution of public
relations text, audio and video to news media and the general public via
satellite, cassette, wire or other means, the maintenance of data bases of media
contacts for and on behalf of clients, the analysis and written appraisal of
public relations and public affairs campaigns as determined through press
clipping review or electronic data base searches, and such other businesses as
the Company may conduct from time to time.

The Company may terminate the employment of the executive officers upon the
death or extended disability of the executive officer or for cause (as defined).
If the employment of the executive officer is terminated by the Company without
cause, the employment agreements require the Company to continue to pay the
executive officer's salary and health and insurance benefits for a period of one
year after such termination in the case of Messrs. Moskowitz and McWhirter and a
period of between three to six months in all other cases, or until the
termination of the employment agreement or the commencement of employment
elsewhere, if earlier.

STOCK OPTION PLANS

THE AMENDED AND RESTATED STOCK OPTION PLAN

The Company's Amended and Restated Stock Option Plan ('Stock Option Plan')
provides for options for a total of 670,808 shares of Common Stock authorized to
be granted under the Stock Option Plan. The Stock Option Plan provides for the
grant of options to its employees, directors and consultants in order to provide
them with financial incentives to promote the success of the Company's long term
business objectives and to increase their proprietary interest in the success of
the Company. The Stock Option Plan provides for a fifteen year expiration period
for non-qualified stock options and ten years for incentive stock options
granted thereunder and allows for the exercise of options by delivery by the
optionee of previously owned Common Stock of the Company having a fair market
value equal to the option price, or by delivery by the optionee of exercisable
options valued at the excess of the aggregate fair market value of the Common
Stock subject to such options over the aggregate exercise price of such options,
or by a combination of cash and Common Stock. During 1995, the Company granted
options to purchase 75,000 shares of Common Stock at exercise prices of $2.29
and having an expiration date of June 30, 2005. During 1995, 4,800 options were
exercised and 204,548 shares were available for future grant under the Stock
Option Plan. At September 30, 1996 there were outstanding options to purchase
569,594 shares of Common Stock under the Stock Option Plan and 63,054 options
were available for future grant. During 1996 the Company granted options to
purchase 411,494 shares at an average exercise price ranging from $3.54 to $6.46
per share.

The Stock Option Plan is administered by the Stock Option Committee of the
Board of Directors. The Committee has broad discretion in determining the
recipients of options and numerous other terms and conditions of the options.
The exercise price for shares purchased upon the exercise of non-qualified stock
options granted under the Plan is determined by the Stock Option Committee as of
the date of the grant. The exercise price of an incentive stock option must be
at least equal to the fair market value of the Common Stock on the date such
option is granted (110% of the fair market value for shareholders who, at the
time the option is granted, own more than 10% of the total combined classes of
stock of the Company or any subsidiary). No employees may be granted incentive
stock options in any year for shares having a fair market value, determined as
of the date of grant, in excess of $100,000.

No incentive option may have a term of more than ten years, five years for
shareholders holding 10% or more of the Common Stock of the Company. Options
generally may be exercised only if the option holder remains continuously
associated with the Company or a subsidiary from the date of grant to the date
of exercise. However, options may be exercised upon termination of employment or
upon the death or disability of any employee within certain specified periods.

1996 DIRECTORS STOCK OPTION PLAN

The Company's 1996 Directors Stock Option Plan ('Directors Stock Option
Plan') provides for options for a total of 180,000 shares of Common Stock
authorized to be granted under the Directors Stock Option Plan. Pursuant to the
Directors Stock Option Plan, the Company has granted to each non-employee
director non-qualified options to purchase 2,400 shares of Common Stock for each
year that such individual was a member of the Board of Directors prior to 1996;
provided, however, that in no event shall the number of options granted for
service prior to 1996 exceed 14,400 shares. Through the date hereof the Company
has granted non-qualified

37
<PAGE>
options to purchase an aggregate of 62,400 shares of Common Stock to
non-employee directors at an exercise price of $3.54 per share.

The Directors Stock Option Plan provides for the automatic annual grant of
options to non-employee directors and is administered by the Board of Directors.
Commencing January 31, 1997, and as of each anniversary date thereafter, each
non-employee director who was in office as of the effective date of the
Directors Stock Option Plan will be automatically granted an option to purchase
3,000 shares of Common Stock. Each non-employee director who was not a director
as of the effective date of the Directors Stock Option Plan shall be granted, as
of the date of his election, options to purchase 3,000 shares of Common Stock
and shall be granted as of each anniversary date thereafter, options to purchase
an additional 3,000 shares of Common Stock.

To remain eligible, a non-employee director must continue to be a member of
the Board of Directors. Options granted to directors for services prior to 1996
are all vested and exercisable; each option granted thereafter is exercisable in
increments of 33 1/3% per year commencing on the first anniversary date of the

date of grant. The exercise price for all options may not be less than the fair
market value of the Common Stock on the date of grant. Options under the
Directors Stock Option Plan have a term of 15 years and may be exercised for
limited periods after a person ceases to serve as a director.

401(k) PLAN

The Company has a 401(k) tax deferred savings plan (the '401(k) Plan'). All
Company employees are eligible to participate in the 401(k) Plan and may make
elective salary reduction contributions to the 401(k) Plan of up to 15% of their
annual compensation, subject to a dollar limit established by law. In addition,
the Company may provide, in its discretion, a matching contribution equal to a
percentage of the employee's contribution. Participants are fully vested at all
times in the amounts they contribute to the 401(k) Plan. Only participants who
have completed a year of service during the 401(k) Plan year and are actively
employed on the last day of such year are vested in the Company's matching
contributions for such year. The Company's contributions are tax deductible to
the Company. Benefits under the 401(k) Plan generally become payable upon
retirement, death or disability.

<PAGE>
CERTAIN TRANSACTIONS

Pursuant to a consulting agreement, dated March 1, 1994, between the
Company and The Davis Partnership, a partnership which is beneficially owned by
Mr. Davis, served as a consultant to the Company. Mr. David Davis, on behalf of
The Davis Partnership, provides services to the Company based in its London
office, including planning, marketing, staffing and operations, and developing
strategic partnerships in the United Kingdom and Europe. For such services, the
Davis Partnership received $93,611 and $76,385 for the fiscal years ended
December 31, 1995 and December 31, 1994, respectively. Under the terms of the
consulting agreement, the Company is obligated to pay to The Davis Partnership
an annual consulting fee equal to 54,000 pounds and a bonus determined by a
formula contained in the consulting agreement. The bonus is to be paid 50% in
cash and 50% in shares of Common Stock. As part of the bonus under the
consulting agreement, Mr. Davis received 2,521 shares of Common Stock in March
1996. The term of this Consulting Agreement was automatically renewed on January
1, 1996 for a twelve month period. Upon the completion of this offering, the
Consulting Agreement will be terminated and Mr. Davis will enter into an
employment agreement with the Company. See 'Management.'

The Company believes that material affiliated transactions between the
Company and its directors, officers, principal stockholders or any affiliates
thereof have been, and will be in the future, on terms no less favorable than
could be obtained from unaffiliated third parties.

<PAGE>
PRINCIPAL AND SELLING STOCKHOLDERS

The following table sets forth certain information as of the date hereof
regarding the beneficial ownership of the Company's Common Stock prior to and
upon completion of the offering, assuming no exercise of the Underwriters'
over-allotment option, (i) by each of the Company's directors and Named
Executive Officers, (ii) by all directors and Named Executive Officers as a
group, (iii) by each person who is known by the Company to own beneficially more
than 5% of the Company's Common Stock, and (iv) by each of the Selling
Stockholders.

<TABLE>
<CAPTION>
SHARES BENEFICIALLY
OWNED PRIOR TO PERCENTAGE OF
DIRECTORS, OFFERING(1) NUMBER OF SHARES
NAMED EXECUTIVE OFFICERS -------------------- SHARES SUBJECT BENEFICIALLY OWNED
AND 5% STOCKHOLDERS NUMBER PERCENT TO OVER-ALLOTMENT AFTER OFFERING(2)
- ------------------------------------------------------ --------- ------- ----------------- ------------------
<S> <C> <C> <C> <C>
American Research & Development II, L.P.(3) .......... 595,070 19.5% 11.8%
c/o American Research & Development Corp.
45 Milk Street
Boston, MA 02109
New York State Business Venture Partnership .......... 440,506 14.5 8.7
c/o Rothschild Inc.
1251 Avenue of the Americas
51st Floor
New York, NY 10020
Laurence Moskowitz(4) ................................ 411,474 13.4 8.1
c/o Medialink Worldwide Incorporated
708 Third Avenue
New York, NY 10017
Harriet Himmel Gilman ................................ 270,667 8.9 5.4
c/o The Chase Manhattan Private Bank
(Florida), N.A.
218 Royal Palm Way
Palm Beach, FL 33480
Henry L. Kimelman(5) ................................. 171,111 5.6 3.4
P.O. Box 301709
St. Thomas, Virgin Islands 00803
J. Graeme McWhirter(6)................................ 98,519 3.2 1.9
Nicholas F. Peters(7)................................. 20,960 * *
Mark Manoff(8)........................................ 39,644 1.3 *
Mary Buhay(9)......................................... 2,800 * *
Harold Finelt(10) .................................... 609,470 19.9 12.0
c/o American Research & Development Corp.
45 Milk Street
Boston, MA 02109
Donald Kimelman(11)................................... 56,400 1.8 1.1
James J. O'Neill(9)................................... 4,800 * *
Gerald P. Rodeen(12).................................. 97,722 3.2 1.9

Theodore Wm. Tashlik(12).............................. 46,221 1.5 *
David Davis(13)....................................... 14,281 * *
All Named Executive Officers and Directors
as a Group (11 Persons)............................. 1,402,291 43.5 26.9
</TABLE>

(Footnotes on next page)
40
<PAGE>
(Footnotes from previous page)

- ------------------
* Represents less than 1% of the outstanding shares of Common Stock
including shares issuable to such beneficial owner under options which
are presently exercisable or will become exercisable within 60 days.

(1) Unless otherwise indicated, each person has sole voting and investment
power with respect to the shares shown as beneficially owned by such
person.

(2) If the over-allotment option is exercised in full, the percentage of

shares beneficially owned after offering of , and
will be reduced to , and , respectively.

(3) Francis J. Hughes, Jr. and Harold Finelt are the individual general
partners of ARD Partners USA, L.P., a general partner of ARD Master,
L.P., the sole general partner of American Research & Development II,
L.P., and as such may be deemed to beneficially own all shares held by
American Research & Development II, L.P. Each of such general partners
disclaims beneficial ownership of a portion of such shares.

(4) Includes 31,620 shares of Common Stock which may be acquired upon the
exercise of stock options which are presently exercisable or will become
exercisable within 60 days.

(5) Does not include an aggregate of 144,000 shares of Common Stock held by
the Charlotte Kimelman Charitable Remainder Trust, Henry L. Kimelman
Charitable Remainder Trust, Henry L. Kimelman Family Foundation and SDJ
Family Trust as to which Mr. Kimelman disclaims beneficial ownership.

(6) Includes 27,939 shares of Common Stock which may be acquired upon the
exercise of stock options which are presently exercisable or will become
exercisable within 60 days. Also includes 6,000 shares owned by the
McWhirter Family LLC which may be deemed to be beneficially owned by Mr.
McWhirter.

(7) Includes 17,960 shares of Common Stock which may be acquired upon the
exercise of stock options which are presently exercisable or will become
exercisable within 60 days.

(8) Includes 18,020 shares of Common Stock which may be acquired upon the
exercise of stock options which are presently exercisable or will become
exercisable within 60 days.

(9) Represents shares of Common Stock which may be acquired upon the
exercise of stock options which are presently exercisable or will become
exercisable within 60 days.

(10) Includes 595,070 shares of Common Stock held by American Research
Development II, L.P. Francis J. Hughes, Jr. and Harold Finelt are the
individual general partners of ARD Partners USA, L.P., a general partner
of ARD Master, L.P., the sole general partner of American Research &
Development II, L.P., and as such may be deemed to beneficially own all
shares held by American Research & Development II, L.P. Each of such
general partners disclaims beneficial ownership of a portion of such
shares. Also includes 14,400 shares of Common Stock which may be acquired
upon the exercise of stock options which are presently exercisable or
will become exercisable within 60 days.

(11) Includes 14,400 shares of Common Stock which may be acquired upon the
exercise of stock options which are presently exercisable or will become
exercisable within 60 days. Also includes 42,000 shares of Common Stock
held by SDJ Family Trust as to which Mr. Kimelman has voting power and
beneficial ownership of 33% of such shares.

(12) Includes 14,400 shares of Common Stock which may be acquired upon the
exercise of stock options which are presently exercisable or will become
exercisable within 60 days.

(13) Includes 11,760 shares of Common Stock which may be acquired upon the
exercise of stock options which are presently exercisable or will become
exercisable within 60 days.

<PAGE>
DESCRIPTION OF CAPITAL STOCK

COMMON STOCK

The Amended and Restated Certificate of Incorporation of the Company
authorizes the issuance of up to 15,000,000 shares of Common Stock, par value of
$.01 per share. Upon completion of the offering, there will be 5,047,933 shares
of Common Stock issued and outstanding. As of the date of this Prospectus, there
are 3,047,933 shares of Common Stock outstanding held of record by 70
stockholders. To date, there has been no public market for the Common Stock.

Holders of Common Stock ('Holders') are entitled to one vote per share for
each share held of record on all matters submitted to a vote of the
stockholders. Holders are entitled to receive ratably such dividends as may be
declared by the Board on the Common Stock out of funds legally available
therefor. The Holders have no preemptive rights, cumulative voting rights, or
rights to convert shares of Common Stock into any other securities, and are not
subject to future calls or assessments by the Company. All shares of Common
Stock of the Company issued in connection with the offering will be fully paid
and nonassessable.

PREFERRED STOCK

The Amended and Restated Certificate of Incorporation authorizes the Board
of Directors to issue up to an aggregate of 1,000,000 shares of preferred stock
(the 'Preferred Stock'), to establish one or more series of Preferred Stock and
to determine, with respect to each such series, the preferences, rights and
other terms thereof. The authorized class of Preferred Stock may be issued in
series from time to time with such designations, relative rights, priorities,
preferences, qualifications, limitations and restrictions thereof as the Board
of Director determines. The rights, priorities, preferences, qualifications,
limitations and restrictions of different series of Preferred Stock may differ
with respect to dividend rates, amounts payable on liquidation, voting rights,
conversion rights, redemption provisions, sinking fund provisions and other
matters. The Board of Directors may authorize the issuance of Preferred Stock
which ranks senior to the Common Stock with respect to the payment of dividends
and the distribution of assets on liquidation. In addition, the Board of
Directors is authorized to fix the limitations and restrictions, if any, upon
the payment of dividends on Common Stock to be effective while any shares of
Preferred Stock are outstanding. The Board of Directors, without stockholder
approval, can issue Preferred Stock with voting and conversion rights which
could adversely affect the voting power of the holders of Common Stock. Upon
completion of the offering, no shares of Preferred Stock will be outstanding and
the Board of Directors has no present plans to issue any such shares.

In accordance with their terms, the outstanding shares of the Series A,
Series B and Series C Preferred Stock will, upon the closing of this offering,
convert into an aggregate of 2,111,669 shares of Common Stock.

STOCK MARKET LISTING

Application has been made to have the Common Stock approved for quotation
on the Nasdaq National Market under the symbol 'MDLK.'

REGISTRATION RIGHTS

The holders of 2,111,669 shares of Common Stock are entitled to certain
rights with respect to the registration of such shares under the Securities Act.
Under the terms of agreements between the Company and these holders, if the
Company proposes to register any of its securities under the Securities Act,
either for its own account or the account of other security holders exercising
registration rights, such holders are entitled to notice of such registration
and are entitled to include at the Company's expense shares of such Common Stock
therein; provided, among other conditions, that the underwriters of any offering
have the right to limit the number of such shares included in such registration.
In addition, such holders may require the Company, on not more than two
occasions and only in the event the aggregate offering price of such shares is
greater than $5 million, to file a registration statement under the Securities
Act at the Company's expense with respect to such shares, and the Company is
required to use its best efforts to effect such registration, subject to certain
conditions and limitations. Further, these holders may require the Company to
register all or a portion of their shares with registration rights on Form S-3,
when the Company is eligible to use such form, subject to certain conditions and
limitations.

42
<PAGE>
CERTAIN ANTITAKEOVER PROVISIONS

Preferred Stock. The Amended and Restated Certificate of Incorporation
authorizes the Board of Directors to establish one or more series of Preferred
Stock and to determine, with respect to any series of Preferred Stock, the
preferences, rights and other terms of such series. See 'Preferred Stock.' The
Company believes that the ability of the Board of Directors to issue one or more
series of Preferred Stock will provide the Company with increased flexibility in
structuring possible future financings and acquisitions and in meeting other
corporate needs. The authorized shares of Preferred Stock, as well as shares of
Common Stock, would be available for issuance without further action by the
Company's stockholders, unless such action is required by applicable law or the
rules of any stock exchange or automated quotation system on which the Company's
securities may be listed or traded. Although the Board of Directors has no
present intention to do so, it could, in the future, issue a series of Preferred
Stock which, due to its terms, could impede a merger, tender offer or other
transaction that some, or a majority, of the Company's stockholders might
believe to be in their best interests.

Section 203 of the Delaware General Corporation Law. The Company is
subject to the provisions of Section 203 of the Delaware General Corporation Law
(the 'Antitakeover Law') regulating corporate takeovers. The Antitakeover Law
prevents certain Delaware corporations, including those whose securities are
listed on the Nasdaq National Market, from engaging, under certain
circumstances, in a 'business combination' (which includes a merger or sale of
more than 10% of the corporation's assets) with any 'interested stockholder' (a
stockholder who acquired 15% or more of the corporation's outstanding voting
stock without the prior approval of the corporation's Board of Directors) for
three years following the date that such stockholder became an 'interested
stockholder.' A Delaware corporation may 'opt out' of the Antitakeover Law with

an express provision in its original certificate of incorporation, or an express
provision in its certificate of incorporation or by-laws resulting from a
stockholders' amendment approved by at least a majority of the outstanding
voting shares. The Company has not 'opted out' of the application of the
Antitakeover Law.

Classified Board of Directors. The Company's Amended and Restated
Certificate of Incorporation provides for the Board of Directors to be divided
into three classes of directors serving staggered three-year terms. As a result,
approximately one-third of the Board of Directors will be elected each year.
Classification of the Board of Directors expands the time required to change the
composition of a majority of directors and may tend to discourage a takeover bid
for the Company. Moreover, under the General Corporation Law of the State of
Delaware, in the case of a corporation having a classified Board of Directors,
the stockholders may remove a director only for cause. The provisions of
Delaware law, when coupled with provisions of the Company's Amended and Restated
Certificate of Incorporation and Amended and Restated By-Laws authorizing only
the Board of Directors to fill vacant directorships, will preclude stockholders
of the Company from removing incumbent directors without cause and
simultaneously gaining control of the Board of Directors by filling the
vacancies with their own nominees.

Certain Other Provisions. The Company's Amended and Restated Certificate
of Incorporation does not provide for cumulative voting in the election of
directors. The Company's Amended and Restated By-Laws provide that stockholders
must own fifty percent of the Common Stock to be permitted to call a special
meeting of the stockholders.

Reference is made to the full text of the Company's Amended and Restated
Certificate of Incorporation and its Amended and Restated By-Laws and the
foregoing statute for their entire terms. The partial summary contained above is
not intended to be complete. See 'Risk Factors--Concentration of Stock
Ownership; Potential Issuance of Preferred Stock; Provisions with Potential
Anti-Takeover Effects.'

LIMITATION OF LIABILITY AND INDEMNIFICATION MATTERS

The Company's Amended and Restated Certificate of Incorporation limits the
liability of directors for monetary damages to the maximum extent permitted by
Delaware law. Such limitation of liability has no effect on the availability of
equitable remedies, such as injunctive relief or rescission.

The Company's Amended and Restated By-Laws provide that the Company will
indemnify its directors, officers, employees and agents (including persons
serving at the request of the Company as a director, officer, employee or agent
of another organization, including service with respect to an employee benefit
plan and any

43
<PAGE>
former director, officer, employee or agent, or other such person) against
certain liabilities to the fullest extent permitted by Delaware law. The Company
is also empowered under its Amended and Restated By-Laws to purchase insurance
on behalf of any person whom it is required or permitted to indemnify. The

Company has entered into indemnification agreements with each of its current
directors and officers, which provide for indemnification of, and advancement of
expenses to, such persons to the greatest extent permitted by Delaware law,
including by reason of action or inaction occurring in the past and
circumstances in which indemnification and advancement of expenses to such
persons is permitted or is discretionary to the greatest extent permitted by
Delaware law. These provisions may have the practical effect in certain cases of
eliminating the ability of stockholders to collect monetary damages from
directors. The Company believes that theses provisions will assist the Company
in attracting and retaining qualified individuals to serve as directors or
officers. It is the opinion of the staff of the Securities and Exchange
Commission that indemnification provisions such as those contained in these
agreements have no effect on a director's or officer's liability under the
federal securities laws.

At the present time, there is no pending litigation or proceeding involving
a director, officer, employee or other agent of the Company in which
indemnification would be required or permitted. The Company is not aware of any
threatened litigation or proceeding which may result in a claim for such
indemnification.

TRANSFER AGENT AND REGISTRAR

The transfer agent and registrar for the Common Stock will be ChaseMellon
Shareholder Services, 450 West 33rd Street, New York, New York 10001.

<PAGE>
SHARES ELIGIBLE FOR FUTURE SALE

Certain of the Company's stockholders are subject to lock-up agreements
under which they have agreed not to sell or otherwise dispose of any shares of
Common Stock without the prior written consent of Dean Witter Reynolds Inc. for
a period of 180 days after the date of this Prospectus whether now owned or
hereafter acquired by such stockholders or with respect to which such
stockholders have or hereafter acquire the power of disposition or enter into
any swap or any other agreement or any transaction that transfers, in whole or
in part, directly or indirectly, the economic consequence of ownership of the
Common Stock or any Common Stock deemed to be beneficially owned by such
stockholders, whether any such swap or transaction is to be settled by delivery
of Common Stock or other securities, in cash or otherwise. Such stockholders
also have agreed not to exercise their registration rights for 180 days after
the date of this Prospectus and have granted Dean Witter Reynolds Inc. the right
of first refusal to be engaged as the lead manager of the underwritten public
offering of their shares if registration rights are exercised following the
expiration of the lock-up period until the date that is 12 months from the date
of this Prospectus. The Company has consented to any such engagement of Dean
Witter Reynolds Inc. The Company has agreed not to issue or sell any shares of
Common Stock, without the prior written consent of Dean Witter Reynolds Inc. for
a period of 180 days after the date of this Prospectus other than the issuance
of shares upon the exercise of stock options. Upon the expiration of the 180-day
lock-up period, certain of the shares of Common Stock subject to the lock-up
agreements will become eligible for sale in the public market subject to the
conditions of Rule 144. See 'Underwriting.'

In general, under Rule 144 as currently in effect, an affiliate of the
Company, or person (or persons whose shares are aggregated) who has beneficially
owned restricted securities for at least two years but less than three years,
will be entitled to sell in any three-month period a number of shares that does
not exceed the greater of (i) 1% of the then outstanding shares of Common Stock

(5,047,933 shares immediately after this offering) or (ii) the average weekly
trading volume during the four calendar weeks immediately preceding the date on
which notice of the sale is filed with the Securities and Exchange Commission.
Sales pursuant to Rule 144 are subject to certain requirements relating to
manner of sale, notice and availability of current public information about the
Company. A person (or persons) whose shares are aggregated who is not deemed to
have been an affiliate of the Company at any time during the 90 days immediately
preceding the sale and who has beneficially owned his or her shares for a least
three years is entitled to sell such shares pursuant to Rule 144(k) without
regard to the limitations described above. In general, under Rule 701 under the
Securities Act as currently in effect, any employee, consultant or advisor of
the Company who purchases shares from the Company in connection with a
compensatory stock or option plan or other written agreement related to
compensation is eligible to resell such shares 90 days after the effective date
of this offering in reliance on Rule 144, but without compliance with certain
restrictions contained in Rule 144. Rule 701 is available for stockholders of
the Company as to all shares issued pursuant to stock option exercises occurring
on or after May 20, 1988 (the effective date of the Rule) of options granted
prior to the offering.

<PAGE>
UNDERWRITING

The Underwriters named below, for whom Dean Witter Reynolds Inc. and Wheat,
First Securities, Inc. are acting as representatives (the 'Representatives'),
have severally agreed, subject to the terms and conditions of an underwriting
agreement (the 'Underwriting Agreement'), to purchase from the Company the
number of shares of Common Stock set forth opposite their respective names
below:

<TABLE>
<CAPTION>
UNDERWRITER NUMBER OF SHARES
- ---------------------------------------------------------------------------- ----------------
<S> <C>
Dean Witter Reynolds Inc....................................................
Wheat, First Securities, Inc................................................
----------------
Total..................................................................
----------------
----------------
</TABLE>

The Underwriting Agreement provides that the obligations of the several
Underwriters thereunder are subject to approval of certain legal matters by
counsel and to various other conditions. The nature of the Underwriters'
obligation is such that they must purchase all of the shares of Common Stock
offered to the public (other than those covered by the over-allotment option
described below), if any of such shares are purchased.

Prior to the offering, there has been no public market for the shares of
Common Stock. The initial public offering price for the shares of Common Stock
was determined through agreement among the Company and the Representatives.
Among the factors considered in making such determination were the prevailing
market conditions and general economic conditions, the market prices of
securities and certain financial and operating information of publicly traded
companies which the Company and the Representatives believed to be comparable to
the Company, the earnings and certain other financial and operating information
of the Company in recent periods, the future prospects of the Company and its
industry in general and other factors deemed relevant.

The Company has been advised by the Underwriters that the Underwriters
propose to offer the shares of Common Stock directly to the public at the
initial public offering price set forth on the cover page of this Prospectus and
to certain dealers (who may include Underwriters) at the public offering price
less a concession not to exceed $ per share. Such dealers may reallow a
concession not to exceed $ per share in sales to other dealers. After the
initial public offering, the public offering price and concessions and
reallowances to dealers may be changed by the Underwriters.

The Selling Stockholders have granted the Underwriters an option
exercisable for 30 days from the date of this Prospectus to purchase up to
300,000 additional shares of Common Stock at the initial public offering price
less the underwriting discounts and commissions, solely to cover

over-allotments. To the extent such option is exercised, each Underwriter will
be obligated, subject to certain conditions, to purchase approximately the same
percentage of such additional shares of Common Stock as the number of shares of
Common Stock set forth opposite each Underwriter's name in the preceding table
bears to the total number of shares of Common Stock listed in such table.

The Company and the Selling Stockholders have agreed to indemnify the
several Underwriters against certain liabilities, including liabilities under
the Securities Act, or to contribute to payments the Underwriters may be
required to make in respect thereof.

The Company, the Company's officers and directors, and certain holders of
Common Stock have agreed not to offer, sell, contract to sell or otherwise
dispose of any shares of Common Stock or any securities convertible into or
exercisable or exchangeable for Common Stock or any right to acquire Common
Stock for a period of 180 days after the date of this Prospectus without the
prior written consent (which consent may be given without notice to the
Company's stockholders or other public announcement) of Dean Witter Reynolds
Inc. Dean Witter Reynolds Inc. has advised the Company that it has no present
intention of releasing any of the Company's

46
<PAGE>
stockholders from such lock-up agreements until the expiration of such 180-day
period. See 'Shares Eligible for Future Sale.'

The Representatives have advised the Company and the Selling Stockholders
that the Underwriters do not intend to confirm sales to any account over which
they exercise discretionary authority.

The Company, each of its directors and executive officers and certain other
stockholders of the Company have agreed with the Underwriters that they will not
offer, sell or contract to sell, or otherwise dispose of or enter into any
agreement to sell, directly or indirectly, any securities convertible into, or
exchangeable or exercisable for, shares of Common Stock for a period of 180 days
after the date of this Prospectus without the prior written consent of Dean
Witter Reynolds Inc. See 'Shares Eligible for Future Sale.'

At the Company's request, the Representatives have reserved up to
shares of Common Stock for sale at the initial public offering price to the
Company's employees and other persons having certain relationships with the
Company. The number of shares of Common Stock available for sale to the general
public will be reduced to the extent these persons purchase such reserved
shares. Any reserved shares not purchased will be offered by the Underwriters to
the general public on the same terms as the other shares offered hereby.

LEGAL MATTERS

Certain legal matters with respect to the legality of the securities
offered hereby will be passed upon for the Company by Tashlik, Kreutzer &
Goldwyn P.C., Great Neck, New York. Theodore Wm. Tashlik, a member of Tashlik,
Kreutzer & Goldwyn P.C. and a director of the Company, beneficially owns 31,821
shares of the Company's Common Stock and stock options to purchase 14,400 shares
of Common Stock. Certain legal matters will be passed upon for the Underwriters

by Willkie Farr & Gallagher, New York, New York.

EXPERTS

The financial statements of the Company as of December 31, 1994 and 1995
and for each of the years in the three-year period ended December 31, 1995 and
the financial statements of PR Data Systems, Inc. as of December 31, 1994 and
1995 and for the years then ended have been included herein and in the
registration statement in reliance upon the reports of KPMG Peat Marwick LLP,
independent certified public accountants, appearing elsewhere herein, and upon
the authority of said firm as experts in accounting and auditing.

ADDITIONAL INFORMATION

The Company has filed with the Securities and Exchange Commission (the
'Commission') in Washington, D.C., a Registration Statement on Form S-1 under
the Securities Act, relating to the Common Stock offered hereby. This
Prospectus, which constitutes a part of the Registration Statement, does not
contain all of the information set forth in the Registration Statement, certain
items of which are contained in exhibits and schedules to the Registration
Statement as permitted by the rules and regulations of the Commission.
Statements contained in this Prospectus as to the contents of any contract,
agreement or any other document referred to herein are not necessarily complete.
Where such contract, agreement or other document is an exhibit to the
Registration Statement, reference is made to such exhibit for a more complete
description of the matter involved, each such statement being qualified in all
respects by such reference. For further information regarding the Company and
the securities offered hereby, reference is made to the Registration Statement
and to the exhibits filed as a part thereof, which may be inspected at the
office of the Commission without charge or copies of which may be obtained
therefrom upon request to the Commission and payment of the prescribed fee.

A copy of the Registration Statement and the exhibits thereto may be
inspected without charge at the public reference facilities maintained by the
Commission's Headquarters at 450 Fifth Street, Room 1024, N.W., Judiciary Plaza,
Washington, D.C. 20549, and at the Commission's Regional Offices at Citicorp
Center, 500 West Madison Street, Suite 1400, Chicago, Illinois 60661, and 7
World Trade Center, 13th Floor, New York, New York 10048, and copies of all or
any part of the Registration Statement may be obtained from such offices upon
the payment of the fees prescribed by the Commission. The Commission maintains a
Web site that contains reports, proxy and information statements and other
information regarding the Company. The address of such Web site is
http://www.sec.gov.

The Company intends to furnish to its stockholders annual reports
containing financial statements audited by independent auditors and quarterly
reports containing unaudited financial data for the first three quarters of each
fiscal year.

<PAGE>
INDEX TO FINANCIAL STATEMENTS

<TABLE>
<CAPTION>
PAGE
----
<S> <C>
Historical
- -----------------------------------------------------------------------------------------------------------
Medialink Worldwide Incorporated
Independent Auditors' Report............................................................................... F-2
Balance Sheets............................................................................................. F-3
Statements of Operations................................................................................... F-4
Statements of Stockholders' Equity......................................................................... F-5
Statements of Cash Flows................................................................................... F-6
Notes to Financial Statements.............................................................................. F-7
PR Data Systems, Inc.
Independent Auditors' Report............................................................................... F-14
Balance Sheets............................................................................................. F-15
Statements of Operations and Accumulated Deficit........................................................... F-16
Statements of Cash Flows................................................................................... F-17
Notes to Financial Statements.............................................................................. F-18

Pro Forma
- -----------------------------------------------------------------------------------------------------------
Medialink Worldwide Incorporated
Unaudited Pro Forma Condensed Combined Financial Statements................................................ F-22
Unaudited Pro Forma Condensed Combined Statement of Operations for the nine months ended September 30,
1996..................................................................................................... F-23
Unaudited Pro Forma Condensed Combined Statement of Operations for the year ended December 31, 1995........ F-24
Notes to Unaudited Pro Forma Condensed Combined Financial Statements....................................... F-25
</TABLE>

F-1

<PAGE>
INDEPENDENT AUDITORS' REPORT

The Board of Directors
Medialink Worldwide Incorporated:

We have audited the accompanying balance sheets of Medialink Worldwide
Incorporated as of December 31, 1994 and 1995, and the related statements of
operations, stockholders' equity and cash flows for each of the years in the
three-year period ended December 31, 1995. These financial statements are the
responsibility of the Company's management. Our responsibility is to express an
opinion on these financial statements based on our audits.

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

In our opinion, the financial statements referred to above present fairly,
in all material respects, the financial position of Medialink Worldwide
Incorporated as of December 31, 1994 and 1995, and the results of its operations
and its cash flows for each of the years in the three-year period ended December
31, 1995, in conformity with generally accepted accounting principles.

KPMG Peat Marwick LLP

August 16, 1996
New York, New York

F-2

<PAGE>
MEDIALINK WORLDWIDE INCORPORATED
BALANCE SHEETS

<TABLE>
<CAPTION>
DECEMBER 31, SEPTEMBER 30,
-------------------------- -------------
1994 1995 1996
----------- ----------- -------------
(UNAUDITED)
<S> <C> <C> <C>
ASSETS
Current Assets:
Cash and cash equivalents................................... $ 262,414 $ 306,678 $ 606,232
Accounts receivable, less allowance for doubtful accounts of
$87,584, $161,367 and $245,004 in 1994, 1995 and 1996,
respectively (Note 2)..................................... 1,335,339 2,418,029 3,185,477
Prepaid expenses and other current assets................... 167,317 262,492 158,957
Deferred tax assets--current portion (Note 5)............... 333,697 617,314 319,746
----------- ----------- -------------
Total current assets...................................... 2,098,767 3,604,513 4,270,412
----------- ----------- -------------
Property and Equipment:
Furniture and fixtures...................................... 143,717 184,292 367,528
Office equipment............................................ 621,919 604,599 788,124
Leasehold improvements...................................... 101,969 174,621 299,720
----------- ----------- -------------
867,605 963,512 1,455,372
Less accumulated depreciation and amortization.............. 547,667 419,132 566,387
----------- ----------- -------------
Net property and equipment................................ 319,938 544,380 888,985
Due from officers............................................. 6,532 6,532 4,883
Goodwill net of amortization (Note 10)........................ -- -- 668,888
Deferred tax assets (Note 5).................................. 714,286 134,389 45,502
Other intangible assets--net (Note 10)........................ -- -- 312,066
Other assets.................................................. 97,676 97,518 360,220
----------- ----------- -------------
Total assets.............................................. $ 3,237,199 $ 4,387,332 $ 6,550,956
----------- ----------- -------------
----------- ----------- -------------

LIABILITIES AND STOCKHOLDERS' EQUITY

Current Liabilities:
Current portion of obligations under capital leases (Note
3)........................................................ $ -- $ -- $ 11,699
Current portion of long-term debt (Note 10)................. -- -- 37,143
Current portion of covenant not to compete (Note 10)........ -- -- 60,000
Accounts payable............................................ 1,065,072 1,586,561 2,171,245
Accrued expenses............................................ 113,203 229,009 408,559
Income taxes payable........................................ 33,945 67,132 82,241
----------- ----------- -------------
Total current liabilities................................. 1,212,220 1,882,702 2,770,887
Commitment under covenant not to compete, excluding current
portion (Note 10)........................................... -- -- 252,066
Deferred rent payable......................................... 8,433 79,878 40,696
Obligation under capital leases, excluding current portion
(Note 3).................................................... -- -- 30,742
Long-term debt, excluding current portion (Note 10)........... -- -- 283,950
----------- ----------- -------------
Total liabilities......................................... 1,220,653 1,962,580 3,378,341
----------- ----------- -------------
Stockholders' Equity (Note 4):
Series A, 10% cumulative convertible preferred stock, $1.50
par value. Authorized; issued and outstanding 655,417
shares.................................................... 983,126 983,126 983,126
Series B, 10% cumulative convertible preferred stock, $1.35
par value. Authorized; issued and outstanding 475,185
shares.................................................... 641,500 641,500 641,500
Series C, 10% cumulative convertible preferred stock, $2.75
par value. Authorized 645,455 shares; issued and
outstanding 629,130 shares................................ 1,730,107 1,730,107 1,730,107
Common stock, $.01 par value. Authorized
15,000,000 shares; issued and outstanding 901,943,
906,743 and 936,264 shares in 1994, 1995 and
1996, respectively........................................ 9,019 9,067 9,363
Additional paid-in capital.................................. 346,572 352,524 520,165
Accumulated deficit......................................... (1,671,117) (1,289,882) (711,012)
Equity adjustment for foreign currency translation.......... (22,661) (1,690) (634)
----------- ----------- -------------
Total stockholders' equity................................ 2,016,546 2,424,752 3,172,615
----------- ----------- -------------
Total liabilities and stockholders' equity................ $ 3,237,199 $ 4,387,332 $ 6,550,956
----------- ----------- -------------
----------- ----------- -------------
</TABLE>

See accompanying notes to financial statements.
F-3

<PAGE>
MEDIALINK WORLDWIDE INCORPORATED
STATEMENTS OF OPERATIONS

<TABLE>
<CAPTION>
NINE MONTHS ENDED
YEARS ENDED DECEMBER 31, SEPTEMBER 30,
----------------------------------------- --------------------------
1993 1994 1995 1995 1996
----------- ----------- ----------- ----------- -----------
(UNAUDITED)
<S> <C> <C> <C> <C> <C>
Revenues.............................. $ 6,064,569 $ 7,547,761 $10,624,680 $ 7,382,316 $11,158,239
Direct costs (Note 7)................. 2,629,114 3,038,503 4,553,349 3,282,667 4,604,668
----------- ----------- ----------- ----------- -----------
Gross profit..................... 3,435,455 4,509,258 6,071,331 4,099,649 6,553,571
General and administrative expenses
(Note 3)............................ 3,650,569 4,068,786 5,373,307 3,796,548 5,548,433
----------- ----------- ----------- ----------- -----------
Operating (loss) income.......... (215,114) 440,472 698,024 303,101 1,005,138
Other income (expense):
Interest expense.................... (12,332) (6,205) -- -- (14,674)
Interest and other income........... 9,259 7,062 15,273 11,939 19,144
----------- ----------- ----------- ----------- -----------
(Loss) income before income
taxes.......................... (218,187) 441,329 713,297 315,040 1,009,608
Income tax expense (benefit) (Note
5).................................. 13,222 (1,022,963) 332,062 148,707 430,738
----------- ----------- ----------- ----------- -----------
Net (loss) income................ $ (231,409) $ 1,464,292 $ 381,235 $ 166,333 $ 578,870
----------- ----------- ----------- ----------- -----------
----------- ----------- ----------- ----------- -----------
Net (loss) income applicable to common
stock............................... $ (566,882) $ 1,128,819 $ 45,762 $ (85,272) $ 327,265
----------- ----------- ----------- ----------- -----------
----------- ----------- ----------- ----------- -----------
Pro forma net income per common
and common equivalent
share--unaudited (Note 9)...... $ 0.11 $ 0.05 $ 0.17
----------- ----------- -----------
----------- ----------- -----------
</TABLE>

See accompanying notes to financial statements.

F-4

<PAGE>
MEDIALINK WORLDWIDE INCORPORATED
STATEMENTS OF STOCKHOLDERS' EQUITY

<TABLE>
<CAPTION>
SERIES A, 10% SERIES B, 10% SERIES C, 10%
CUMULATIVE CUMULATIVE CUMULATIVE
CONVERTIBLE CONVERTIBLE CONVERTIBLE
COMMON STOCK PREFERRED STOCK PREFERRED STOCK PREFERRED STOCK
-------------------- -------------------- -------------------- ---------------------
NO. OF NO. OF NO. OF NO. OF
SHARES PAR VALUE SHARES PAR VALUE SHARES PAR VALUE SHARES PAR VALUE
------- --------- ------- --------- ------- --------- ------- ----------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Balance at December 31,
1992.................... 879,650 $ 8,796 655,417 $ 983,126 475,185 $ 641,500 629,130 $1,730,107
Issuance of common stock.. 19,293 193 -- -- -- -- -- --
Stock options exercised... 3,000 30 -- -- -- -- -- --
Net loss.................. -- -- -- -- -- -- -- --
Translation adjustment.... -- -- -- -- -- -- -- --
------- --------- ------- --------- ------- --------- ------- ----------
Balance at December 31,
1993.................... 901,943 9,019 655,417 983,126 475,185 641,500 629,130 1,730,107
Net income................ -- -- -- -- -- -- -- --
Translation adjustment.... -- -- -- -- -- -- -- --
------- --------- ------- --------- ------- --------- ------- ----------
Balance at December 31,
1994.................... 901,943 9,019 655,417 983,126 475,185 641,500 629,130 1,730,107
Stock options exercised... 4,800 48 -- -- -- -- -- --
Net income................ -- -- -- -- -- -- -- --
Translation adjustment.... -- -- -- -- -- -- -- --
------- --------- ------- --------- ------- --------- ------- ----------
Balance at December 31,
1995.................... 906,743 9,067 655,417 983,126 475,185 641,500 629,130 1,730,107
Issuance of common
stock--unaudited........ 26,521 266 -- -- -- -- -- --
Stock options exercised--
unaudited............... 3,000 30 -- -- -- -- -- --
Net income--unaudited..... -- -- -- -- -- -- -- --
Translation adjustment--
unaudited............... -- -- -- -- -- -- -- --
------- --------- ------- --------- ------- --------- ------- ----------
Balance at September 30,
1996--unaudited......... 936,264 $ 9,363 655,417 $ 983,126 475,185 $ 641,500 629,130 $1,730,107
------- --------- ------- --------- ------- --------- ------- ----------
------- --------- ------- --------- ------- --------- ------- ----------

<CAPTION>
EQUITY
ADJUSTMENT
FOR
ADDITIONAL FOREIGN TOTAL
PAID-IN ACCUMULATED CURRENCY STOCKHOLDERS'
CAPITAL DEFICIT TRANSLATION EQUITY
---------- ----------- ---------- -------------
<S> <C> <C> <C> <C>
Balance at December 31,
1992.................... $318,928 $(2,904,000) $(28,131) $ 750,326
Issuance of common stock.. 23,924 -- -- 24,117
Stock options exercised... 3,720 -- -- 3,750
Net loss.................. -- (231,409 ) -- (231,409)
Translation adjustment.... -- -- 10,176 10,176
---------- ----------- ---------- -------------
Balance at December 31,
1993.................... 346,572 (3,135,409 ) (17,955) 556,960
Net income................ -- 1,464,292 -- 1,464,292
Translation adjustment.... -- -- (4,706) (4,706)
---------- ----------- ---------- -------------
Balance at December 31,
1994.................... 346,572 (1,671,117 ) (22,661) 2,016,546
Stock options exercised... 5,952 -- -- 6,000
Net income................ -- 381,235 -- 381,235
Translation adjustment.... -- -- 20,971 20,971
---------- ----------- ---------- -------------
Balance at December 31,
1995.................... 352,524 (1,289,882 ) (1,690) 2,424,752
Issuance of common
stock--unaudited........ 163,921 -- -- 164,187
Stock options exercised--
unaudited............... 3,720 -- -- 3,750
Net income--unaudited..... -- 578,870 -- 578,870
Translation adjustment--
unaudited............... -- -- 1,056 1,056
---------- ----------- ---------- -------------
Balance at September 30,
1996--unaudited......... $520,165 $ (711,012 ) $ (634) $ 3,172,615
---------- ----------- ---------- -------------
---------- ----------- ---------- -------------
</TABLE>

See accompanying notes to financial statements.

F-5

<PAGE>
MEDIALINK WORLDWIDE INCORPORATED
STATEMENTS OF CASH FLOWS

<TABLE>
<CAPTION>
NINE MONTHS
YEARS ENDED DECEMBER 31, ENDED SEPTEMBER 30,
-------------------------------------- ----------------------
1993 1994 1995 1995 1996
---------- ---------- ---------- -------- ----------
(UNAUDITED)
<S> <C> <C> <C> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
Net (loss) income................................ $ (231,409) $1,464,292 $ 381,235 $166,333 $ 578,870
Adjustments to reconcile net (loss) income to net
cash (used in) provided by operating activities:
Depreciation and amortization.................... 117,547 127,377 148,509 106,057 160,339
Provision for bad debts.......................... 58,105 5,601 74,701 53,896 83,638
Equity adjustment for foreign currency
translation.................................... 10,176 (4,706) 20,971 39,483 1,056
Loss on disposal of assets....................... -- -- 22,489 22,489 --
Deferred income taxes............................ -- (1,047,983) 296,280 130,816 386,455
Deferred rent payable............................ (9,666) (5,951) 71,445 364 (39,182)
Increase in accounts receivable.................. (211,067) (375,383) (1,154,422) (514,295) (562,371)
Decrease in due from officers.................... 3,000 -- -- -- 1,649
(Increase) decrease in prepaid expenses and other
current assets................................. (67,696) (41,993) (94,713) (66,794) 105,068
Increase in accounts payable and accrued
expenses....................................... 226,491 261,133 635,325 344,385 450,589
(Decrease) increase in income taxes payable...... (3,199) 23,313 33,187 31,781 15,109
---------- ---------- ---------- -------- ----------
Total adjustments.............................. 123,691 (1,058,592) 53,772 148,182 602,350
---------- ---------- ---------- -------- ----------
Net cash (used in) provided by operating
activities................................... (107,718) 405,700 435,007 314,515 1,181,220
---------- ---------- ---------- -------- ----------
CASH FLOWS FROM INVESTING ACTIVITIES:
Net cash used in acquisition of PR Data Systems,
Inc............................................ -- -- -- -- (119,801)
Additions to property and equipment.............. (62,420) (127,407) (394,496) (346,072) (412,188)
Increase in other assets......................... (4,049) (60,117) (2,247) (14,188) (8,381)
---------- ---------- ---------- -------- ----------
Net cash used in investing activities.......... (66,469) (187,524) (396,743) (360,260) (540,370)
---------- ---------- ---------- -------- ----------

CASH FLOWS FROM FINANCING ACTIVITIES:
Deferred offering costs.......................... -- -- -- -- (253,425)
Proceeds from exercise of options................ -- -- 6,000 -- 3,750
Proceeds from issuance of common stock........... 27,867 -- -- -- 9,186
Principal payments under covenant not to
compete........................................ -- -- -- -- (4,970)
Borrowings under note payable--bank.............. 250,000 -- -- -- --
Principal payments under capital lease
obligations.................................... -- -- -- -- (1,950)
Repayments of note payable--bank................. (70,000) (180,000) -- -- (84,980)
Repayment of long-term debt...................... -- -- -- -- (8,907)
---------- ---------- ---------- -------- ----------
Net cash provided by (used in) financing
activities................................... 207,867 (180,000) 6,000 -- (341,296)
---------- ---------- ---------- -------- ----------
Net increase in cash and cash equivalents...... 33,680 38,176 44,264 (45,745) 299,554
CASH AND CASH EQUIVALENTS at beginning of
period....................................... 190,558 224,238 262,414 262,414 306,678
---------- ---------- ---------- -------- ----------
CASH AND CASH EQUIVALENTS at end of period..... $ 224,238 $ 262,414 $ 306,678 $216,669 $ 606,232
---------- ---------- ---------- -------- ----------
---------- ---------- ---------- -------- ----------
</TABLE>

See accompanying notes to financial statements.

F-6

<PAGE>
MEDIALINK WORLDWIDE INCORPORATED
NOTES TO FINANCIAL STATEMENTS

INFORMATION AS OF SEPTEMBER 30, 1996 AND INFORMATION RELATING TO THE NINE MONTHS
ENDED SEPTEMBER 30, 1995 AND 1996 IS UNAUDITED.

(1) SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

(a) Description of Business

Medialink Worldwide Incorporated (the 'Company') is a Delaware corporation
incorporated on September 24, 1986. In August 1996 the Company changed its name
from Video Broadcasting Corporation. The Company is a worldwide provider of
video and audio production and distribution services for business and other
organizations that seek to communicate their news through television, radio and
other media. Since July 18, 1996, as a result of the acquisition of
substantially all of the assets and liabilities of PR Data Systems Inc. ('PR
Data'--see note 10), the Company has expanded its research capabilities and
added print news release distribution services. The Company has seven offices in
the United States and one office in the United Kingdom ('UK').

(b) Revenue Recognition

Fees earned from the distribution and monitoring of video news releases and
the distribution of printed news releases are recognized in the period that the
release is distributed. Fees earned for satellite media tours and producing
video news releases and live broadcasts are recognized in the period that
services are performed.

Property and equipment are stated at cost. Depreciation on property and
equipment is computed on the straight-line method over the estimated useful
lives of the assets. Leasehold improvements are amortized over the shorter of
the lease term or estimated useful life of the asset.

(d) Deferred Rent Payable

In accordance with Statement of Financial Accounting Standards No. 13,
'Accounting for Leases,' the Company recognizes rental costs on a straight-line
basis over the fixed term of the lease period. Deferred rent payable represented
the excess of rental expense recorded over rental payments to date.

(e) Cash and Cash Equivalents

The Company considers all highly liquid debt instruments with original
maturities of three months or less to be cash equivalents. At December 31, 1994

and 1995 and September 30, 1996, cash equivalents consisted of amounts on
deposit in money market accounts amounting to $186,776, $109,159 and $55,294,
respectively.

(f) Foreign Currency Translation

Foreign operations' financial statements are translated to U.S. dollars in
accordance with Statement of Financial Accounting Standards No. 52, 'Foreign
Currency Translation.' Assets and liabilities of the foreign bureau are
translated into U.S. dollars at year-end rates of exchange. Statements of
operations accounts are translated at the average exchange rate prevailing
during the year. Resulting translation adjustments are reported as a separate
component of stockholders' equity.

(g) Income Taxes

The Company accounts for income taxes under the provisions of Statement of
Financial Accounting Standards No. 109, 'Accounting for Income Taxes' (Statement
109). Under the asset and liability method of Statement 109, deferred tax assets
and liabilities are recognized for the future tax consequences attributable to
differences between the financial statement carrying amounts of existing assets
and liabilities and their respective tax bases and operating loss and tax credit
carryforwards. Deferred tax assets and liabilities are measured using enacted
tax rates expected to apply to taxable income in the years in which those
temporary differences are

F-7
<PAGE>
MEDIALINK WORLDWIDE INCORPORATED
NOTES TO FINANCIAL STATEMENTS--(CONTINUED)

INFORMATION AS OF SEPTEMBER 30, 1996 AND INFORMATION RELATING TO THE NINE MONTHS
ENDED SEPTEMBER 30, 1995 AND 1996 IS UNAUDITED.

(1) SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES--(CONTINUED)

expected to be recovered or settled. Under Statement 109, the effect on deferred
tax assets and liabilities of a change in tax rates is recognized in income in
the period that includes the enactment date.

(h) Use of Estimates

Management of the Company has made a number of estimates and assumptions
relating to the reporting of assets and liabilities and the disclosure of
contingent assets and liabilities to prepare these financial statements in
conformity with generally accepted accounting principles. Actual results could
differ from those estimates.

(i) Fair Value of Financial Instruments

The carrying values of financial instruments approximate their estimated

fair value because of the short maturity of these instruments.

(j) Unaudited Interim Financial Statements

In the opinion of management, the unaudited interim balance sheet as of
September 30, 1996 and the related statements of operations, stockholders'
equity and cash flows for the nine months ended September 30, 1995 and 1996 have
been prepared on the same basis as the audited financial statements contained
herein and include all adjustments, consisting only of normal recurring
adjustments, necessary for a fair presentation of the financial information set
forth therein. The results of operations for the nine months ended September 30,
1996, are not necessarily indicative of the results that may be expected for the
year end December 31, 1996.

(2) NOTE PAYABLE--BANK

In March 1995, the Company entered into a credit facility with a bank.
Under this agreement, the Company can borrow up to the lesser of $500,000 or 70%
of the eligible accounts receivable, as defined in the agreement, through
February 28, 1997. The interest rate for the bank borrowings is the prime rate
plus 1.00% and is payable monthly. The loan is secured by the Company's accounts
receivable and all other assets of the Company. No borrowings were outstanding
under this credit facility at December 31, 1994 and 1995 or September 30, 1996.
The loan agreement requires the Company to meet certain financial ratio tests
and prohibits the payment of cash dividends.

Borrowings in 1993 and 1994 under a previous credit facility with another
bank bore interest at the prime rate plus 1 3/4%.

(3) LEASE COMMITMENTS

The Company has several noncancelable operating leases for office space
expiring at various dates through 2004. As of December 31, 1995, future minimum
lease payments under noncancelable operating leases are as follows:

<TABLE>
<CAPTION>
YEAR ENDING DECEMBER 31, AMOUNT
- -------------------------------------------------------------------------------- ----------
<S> <C>
1996............................................................................ $ 482,000
1997............................................................................ 442,000
1998............................................................................ 445,000
1999............................................................................ 374,000
2000............................................................................ 295,000
Thereafter...................................................................... 1,106,000
----------
$3,144,000
----------
----------
</TABLE>

Total rent expense for operating leases in the years ended December 31,
1993, 1994 and 1995 and the nine months ended September 30, 1996 was $362,993,
$368,171, $326,916 and $471,391, respectively.

F-8
<PAGE>
MEDIALINK WORLDWIDE INCORPORATED
NOTES TO FINANCIAL STATEMENTS--(CONTINUED)

INFORMATION AS OF SEPTEMBER 30, 1996 AND INFORMATION RELATING TO THE NINE MONTHS
ENDED SEPTEMBER 30, 1995 AND 1996 IS UNAUDITED.

(3) LEASE COMMITMENTS--(CONTINUED)

The Company leases copier equipment under capital leases. Minimum future lease
payments under capital leases at September 30, 1996 are:

<TABLE>
<CAPTION>
PERIOD ENDING DECEMBER 31,
- ---------------------------------------------------------------
<S> <C>
1996........................................................... $ 4,988
1997........................................................... 14,963
1998........................................................... 14,963
1999........................................................... 17,919
2000........................................................... 351
--------
Total minimum lease payments................................... 53,184
Less amount representing interest.............................. (10,743)
--------
Present value of net minimum lease payments.................... 42,441
Less current portion........................................... (11,699)
--------
$ 30,742
--------
--------
</TABLE>

(4) STOCKHOLDERS' EQUITY

Stock Split

In July 1996, the Company effected a 1.2 for one stock split. In addition,
the Company restated its Certificate of Incorporation to increase its authorized
capitalization from 5,000,000 shares of common stock, par value $.01 per share
('Common Stock'), to 15,000,000 shares. These changes resulted in an increase in
Common Stock and corresponding decrease in additional paid-in capital. All per
share data and references to numbers of shares have been restated for all
periods presented to reflect these changes.

Preferred Shares

Annual dividends on the Series A, 10% cumulative convertible preferred
stock, Series B, 10% cumulative convertible preferred stock and Series C, 10%
cumulative convertible preferred stock are cumulative, commencing July 1, 1989
for Series A and Series B and October 31, 1989 for Series C, until declared and
paid at the discretion of the Board of Directors. At December 31, 1995,
dividends in arrears on the Series A, Series B and Series C cumulative
convertible preferred stock amounted to approximately $639,000, $417,000 and
$1,017,000, respectively.

Each share of Series A, Series B and Series C cumulative convertible
preferred stock is convertible at any time at the option of the stockholder into
1.2 shares of Common Stock and will convert into 1.2 shares of Common Stock upon
the closing of an initial public offering pursuant to which the Company receives
net cash proceeds of at least $5 million, and in which the public price per
share is at least $5.50.

Stock Option Plan for Employees

The Company has a stock option plan (the 'Stock Option Plan') that provides
for the granting of options to employees to purchase shares of the Common Stock.
The Company has reserved 490,808 shares for the exercise of these options. In
January 1996, the Company increased the shares reserved for grant by 180,000.
The option price under the Plan shall not be less than 85% of the fair market
value of such share of Common Stock on the date of the grant as determined by
the Company. Under the Stock Option Plan, options issued are exercisable at such
times as determined by the Company but no later than ten years after the date of
the grant.

Options to purchase 251,100 shares of Common Stock at $1.25 and $2.29 per
share were granted and are outstanding at December 31, 1995. Twenty percent of
the options become exercisable each July 1, commencing in the year the options
are granted. The options expire six years from the date of grant. However, upon
the

F-9
<PAGE>
MEDIALINK WORLDWIDE INCORPORATED
NOTES TO FINANCIAL STATEMENTS--(CONTINUED)

INFORMATION AS OF SEPTEMBER 30, 1996 AND INFORMATION RELATING TO THE NINE MONTHS
ENDED SEPTEMBER 30, 1995 AND 1996 IS UNAUDITED.

(4) STOCKHOLDERS' EQUITY--(CONTINUED)

termination of employment of any person, the options will expire 90 days after
the termination date, but no later than the specified expiration date.

In February and July of 1996, 387,494 and 24,000 options were granted at
exercise prices of $3.54 and $6.46, respectively, with a five-year term pursuant
to the Stock Option Plan.

Activity under the Stock Option Plan is summarized as follows:

<TABLE>
<CAPTION>
NINE MONTHS
ENDED
DECEMBER 31, SEPTEMBER 30,
----------------------------- -------------
1993 1994 1995 1996
------- ------- ------- -------------
<S> <C> <C> <C> <C>
Outstanding options at January 1........................ 277,500 262,500 213,600 251,100
Granted--option prices ranging from $1.25 per share in
1993, $1.25 per share in 1994, $2.29 per share in 1995
and $3.54 and $6.46 per share in 1996................. -- 14,400 75,000 411,494
Exercised............................................... (3,000) -- (4,800) (3,000)
Cancelled and expired................................... (12,000) (63,300) (32,700) (90,000)
------- ------- ------- -------------
Outstanding (in 1996, exercisable at $1.25 to $6.46 per
share) at end of period............................... 262,500 213,600 251,100 569,594
------- ------- ------- -------------
------- ------- ------- -------------
Exercisable (in 1996, exercisable at $1.25 to $6.46 per
share) at end of period............................... 201,480 208,740 214,140 189,639
------- ------- ------- -------------
------- ------- ------- -------------
Available for grant at end of period.................... 17,948 66,848 204,548 63,054
------- ------- ------- -------------
------- ------- ------- -------------
</TABLE>

Stock Option Plan for Directors

In February 1996, the Company established a stock option plan (the
'Directors Stock Option Plan') that provides for the granting of options to
non-employee members of the Company's Board of Directors to purchase shares of
the Common Stock. The Company has reserved 180,000 shares for the exercise of
these options. The option price under the Directors Stock Option Plan shall not
be less than the fair market value of such share of Common Stock on the date of
the grant as determined by the Company. Under the Directors Stock Option Plan,
options issued are exercisable at such times as determined by the Company but no
later than fifteen years after the date of the grant.

Options to purchase 62,400 shares of Common Stock at $3.54 per share were
granted to non-employee directors in February 1996 for services rendered prior
to 1996. No individual directors' grant exceeded 14,400 shares. The options
expire fifteen years from the date of grant. However, upon the termination of
board membership of any person, the options will expire 90 days after the
termination date, but no later than the specified expiration date. These
directors will be eligible for additional grants of 3,000 shares per year in
future years if they continue to serve the Company in that capacity. Such future
grants would become exercisable over a three-year period.

Common Stock Warrants

In 1989, the Company issued warrants to purchase 10,110 shares of its
Common Stock at $2.50 per share. Such warrants expired in 1994.

Deferred Compensation Plan

The Company has a 401(k) plan (the '401(k) Plan') covering all eligible
employees. The 401(k) Plan is currently funded by voluntary salary deductions by
plan members and is limited to the maximum amount that can be deducted for
Federal income tax purposes. The Company is not required to make contributions
to the 401(k) Plan; however, employer contributions may be made on a
discretionary basis. For the three years ended

F-10
<PAGE>
MEDIALINK WORLDWIDE INCORPORATED
NOTES TO FINANCIAL STATEMENTS--(CONTINUED)

INFORMATION AS OF SEPTEMBER 30, 1996 AND INFORMATION RELATING TO THE NINE MONTHS
ENDED SEPTEMBER 30, 1995 AND 1996 IS UNAUDITED.

(4) STOCKHOLDERS' EQUITY--(CONTINUED)

December 31, 1995, the Company's expenses in connection with the 401(k) Plan
were $16,186, $20,320 and $27,233 for 1993, 1994 and 1995, respectively, and
$44,366 for the nine months ended September 30, 1996 which is reflected in
general and administrative expenses in the accompanying financial statements.

(5) INCOME TAXES

The provision for income taxes expense (benefit) consists of the following:

<TABLE>
<CAPTION>
NINE MONTHS
ENDED
YEAR ENDED DECEMBER 31, SEPTEMBER 30,
----------------------------------- -------------
1993 1994 1995 1996
-------- ----------- -------- -------------
<S> <C> <C> <C> <C>
Current:
Federal......................................... $ -- $ 12,393 $ 20,000 $ 22,617
State and local................................. 13,222 12,627 15,782 21,666
-------- ----------- -------- -------------
13,222 25,020 35,782 44,283
Deferred:
Federal......................................... -- (783,341) 221,462 299,226
State and local................................. -- (264,642) 74,818 87,229
-------- ----------- -------- -------------
-- (1,047,983) 296,280 386,455
-------- ----------- -------- -------------
$ 13,222 $(1,022,963) $332,062 $ 430,738
-------- ----------- -------- -------------
-------- ----------- -------- -------------
</TABLE>

Income tax (benefit) expense differs from the amount computed by
multiplying the statutory rate of 34% to income before income taxes due to the
following:

<TABLE>
<CAPTION>
NINE MONTHS
ENDED
YEAR ENDED DECEMBER 31, SEPTEMBER 30,
----------------------------------- -------------
1993 1994 1995 1996
-------- ----------- -------- -------------
<S> <C> <C> <C> <C>
Income tax (benefit) expense at statutory rate.... $(74,184) $ 150,052 $242,929 $ 343,267
Increase (reduction) in income taxes resulting
from:
State and local income taxes, net of Federal
income tax benefit........................... 13,222 40,717 59,796 71,871
Nondeductible expenses.......................... -- 16,159 9,337 13,306
Increase (reduction) in valuation allowance..... 74,184 (1,242,284) -- --
Other........................................... -- 12,393 20,000 2,294
-------- ----------- -------- -------------
$ 13,222 $(1,022,963) $332,062 $ 430,738
-------- ----------- -------- -------------
-------- ----------- -------- -------------
</TABLE>

The tax effects of temporary differences that give rise to significant
portions of the deferred tax assets at December 31, 1994 and 1995 and September
30, 1996 are presented below:

<TABLE>
<CAPTION>
1994 1995 1996
---------- -------- --------
<S> <C> <C> <C>
Deferred tax assets:
Accounts receivable, principally due to allowance for doubtful
accounts.................................................... $ 35,857 $ 46,114 $ 82,886
Leasehold improvements, principally due to differences in
amortization................................................ 12,202 4,457 11,390
Equipment, principally due to differences in depreciation...... 26,063 33,441 34,112
Net operating loss carryforward................................ 973,861 667,691 214,243
Other.......................................................... -- -- 22,617
---------- -------- --------
Net deferred tax asset........................................... $1,047,983 $751,703 $365,248
---------- -------- --------
---------- -------- --------
</TABLE>

F-11
<PAGE>
MEDIALINK WORLDWIDE INCORPORATED
NOTES TO FINANCIAL STATEMENTS--(CONTINUED)

INFORMATION AS OF SEPTEMBER 30, 1996 AND INFORMATION RELATING TO THE NINE MONTHS
ENDED SEPTEMBER 30, 1995 AND 1996 IS UNAUDITED.

(5) INCOME TAXES--(CONTINUED)

Upon the adoption of Statement 109 in 1993, because of its operating losses
and the level of deferred tax assets, the Company could not conclude that it was
more likely than not that its deferred tax assets would be realized and,
consequently, set up a valuation allowance. At December 31, 1994, based on its
earnings for the year and expectations of future earnings, the Company
determined that it was more likely than not that its deferred tax assets would
be realized and, consequently, reversed the remaining valuation allowance.

(6) FOREIGN OPERATIONS

Selected financial information regarding the Company's UK office as of and
for the years ended December 31, 1993, 1994 and 1995 and for the nine months

ended September 30, 1996 is as follows:

<TABLE>
<CAPTION>
1993 1994 1995 1996
--------- --------- ---------- ----------
<S> <C> <C> <C> <C>
Total assets...................................... $ 393,878 $ 560,295 $ 940,086
--------- ---------- ----------
--------- ---------- ----------
Total liabilities................................. $ 156,233 $ 327,818 $ 500,965
--------- ---------- ----------
--------- ---------- ----------
Revenues.......................................... $ 360,074 $ 834,749 $1,484,670 $1,880,619
--------- --------- ---------- ----------
--------- --------- ---------- ----------
Operating gain (loss)............................. $(281,081) $(103,341) $ (21,606) $ 82,620
--------- --------- ---------- ----------
--------- --------- ---------- ----------
</TABLE>

(7) COMMITMENTS

On April 30, 1990, the Company entered into an agreement for communications
services. The agreement, which was amended and restated on November 1, 1993,
extends until November 1, 1997. The agreement provides for guaranteed minimum
payments which currently approximate $516,000 per year. Charges included in
direct costs on the accompanying statement of operations under this agreement
amounted to $516,344, $497,617 and $526,516 for the years ended December 31,
1993, 1994 and 1995, respectively, and $383,133 for the nine months ended
September 30, 1996.

(8) SUPPLEMENTAL CASH FLOWS INFORMATION

Cash paid for interest and income taxes during the years ended December 31,
1993, 1994 and 1995 and the nine months ended September 30, 1996 was as follows:

<TABLE>
<CAPTION>
1993 1994 1995 1996
------- ------ ------ -------
<S> <C> <C> <C> <C>
Interest...................................................... $12,332 $6,205 $ -- $14,674
Income taxes.................................................. $16,421 $2,868 $3,733 $28,615
</TABLE>

In connection with the acquisition of the operations of PR Data Systems,
Inc. ('PR Data') in July 1996, the Company issued shares of Common Stock to the
sellers valued at $155,000 and assumed certain of the obligations and
liabilities of PR Data as at the closing date with the exception that such
obligations and liabilities assumed could not exceed the book value of assets
acquired by more than $372,000.

(9) UNAUDITED PRO FORMA INFORMATION

Pro forma net income per common and common equivalent share is calculated
using the weighted average number of shares of Common Stock outstanding during
the period, plus Common Stock issuable pursuant to options granted under the
Stock Option Plan issued at prices below the assumed initial public offering
price per share during the twelve-month period immediately preceding the initial
filing date of the Company's Registration Statement for its public offering,
assuming such Common Stock was outstanding for all periods presented. In
addition, shares of Common Stock issuable upon the conversion of all shares of
Series A, Series B and Series C Preferred Stock into shares of Common Stock are
included in the calculation as if they were outstanding for all periods
presented. The weighted average number of common equivalent shares outstanding
during the period ended December 31, 1995 and September 30, 1996, after
reflecting a 1 for 1.2 stock split effective July 31, 1996 was 3,453,109 and
3,485,011, respectively.

F-12

<PAGE>
MEDIALINK WORLDWIDE INCORPORATED
NOTES TO FINANCIAL STATEMENTS--(CONTINUED)

INFORMATION AS OF SEPTEMBER 30, 1996 AND INFORMATION RELATING TO THE NINE MONTHS
ENDED SEPTEMBER 30, 1995 AND 1996 IS UNAUDITED.

(10) ACQUISITION OF PR DATA SYSTEMS, INC.

On July 18, 1996, the company entered into an asset purchase agreement (the
'Agreement') with PR Data and its stockholders. Under the terms of the
Agreement, the Company acquired all of PR Data's tangible and intangible assets
for cash of $120,000 and through the issuance of 24,000 shares of the Company's
Common Stock valued at $155,000. The Company also assumed certain of the
obligations and liabilities of PR Data as at the closing date with the exception
that such obligations and liabilities assumed could not exceed the book value of
assets acquired by more than $372,000.

The Company also entered into non-compete agreements with the principal
officers and stockholders of PR Data. These agreements are for periods of five
years and provide for quarterly payments aggregating $410,000 during this
period. The present value of each of the non-compete asset and the related
payment obligation at September 30, 1996 is $312,066, respectively.

The Company has accounted for this acquisition as a purchase. The
information for the nine months ended September 30, 1996 contained in the
accompanying 1996 financial statements reflect the operating results of PR Data
subsequent to July 18, 1996.

The purchase price exceeds the fair value of the assets acquired and
assumed by approximately $677,000 which has been allocated to goodwill. In
addition, the non-compete agreements have been recorded as an intangible asset
at the present value of the related payments, calculated using the Company's
estimated rate at the time of 9.5%. Goodwill is being amortized over 15 years
and the non-compete agreements are being amortized over five years.

Immediately following the acquisition, the Company converted certain of the
liabilities of PR Data that it assumed, which were payable to a former
stockholder of PR Data, into a note in the amount of $330,000. This note bears
interest at 8% and is payable in equal installments over seven years. Aggregate
principal payments under this note after September 30, 1996 are as follows:

<TABLE>
<CAPTION>
PERIOD AMOUNT
- -------------------------------------------------------------- --------
<S> <C>
Period ending December 31,
1996..................................................... $ 9,085
1997..................................................... 38,193
1998..................................................... 41,341
1999..................................................... 44,749
2000..................................................... 48,437
2001..................................................... 52,430
2002..................................................... 56,752
2003..................................................... 30,106
--------
Total principal payments................................. 321,093
less current portion..................................... (37,143)
--------
$283,950
--------
--------
</TABLE>

F-13

<PAGE>
INDEPENDENT AUDITORS' REPORT

THE BOARD OF DIRECTORS
PR DATA SYSTEMS, INC.:

We have audited the accompanying balance sheets of PR Data Systems, Inc. as
of December 31, 1994 and 1995, and the related statements of operations and
accumulated deficit and cash flows for the years then ended. These financial
statements are the responsibility of the Company's management. Our
responsibility is to express an opinion on these financial statements based on
our audits.

In our opinion, the financial statements referred to above present fairly,
in all material respects, the financial position of PR Data Systems, Inc. as of
December 31, 1994 and 1995, and the results of its operations and its cash flows
for the years then ended in conformity with generally accepeted accounting
principles.

KPMG Peat Marwick LLP

New York, New York
August 22, 1996

F-14

<PAGE>
PR DATA SYSTEMS, INC.
BALANCE SHEETS

<TABLE>
<CAPTION>
DECEMBER 31, JUNE 30,
-------------------- -----------
1994 1995 1996
-------- -------- -----------
(UNAUDITED)
<S> <C> <C> <C>
ASSETS
Current Assets:
Cash....................................................................... $ 5,083 $ 4,008 $ --
Accounts receivable net of allowance for doubtful accounts of $25,000 and
$18,000 in 1994 and 1995, respectively.................................. 219,838 248,229 252,320
Prepaid expenses........................................................... 3,104 2,707 1,284
-------- -------- -----------
Total current assets.................................................... 228,025 254,944 253,604
Property and equipment, net of accumulated depreciation of $238,027 and
$216,540 in 1994 and 1995, respectively (Note 2)........................... 54,892 90,301 77,576
Security deposits............................................................ 6,035 7,731 7,731
Deferred loan costs.......................................................... 7,044 5,166 4,227
-------- -------- -----------
Total assets............................................................ $295,996 $358,142 $ 343,138
-------- -------- -----------
-------- -------- -----------

LIABILITIES AND STOCKHOLDERS' DEFICIT
Current Liabilities:
Current portion of obligations under capital leases (Note 3)............... 8,307 11,699 11,699
Current portion of long-term debt (Note 4)................................. 136,455 104,442 87,513
Loans payable (Note 5)..................................................... -- 11,500 --
Accounts payable........................................................... 136,361 133,160 129,717
Amounts payable to related parties (Note 5):
Accrued interest........................................................ 49,785 76,910 90,107
Accrued rent............................................................ 30,922 43,470 27,962
Accrued salaries........................................................... 29,390 30,535 32,598
Other accrued expenses..................................................... 1,488 235 1,888
Deferred revenue........................................................... 51,806 54,056 --
Income taxes payable....................................................... 895 615 349
-------- -------- -----------
Total current liabilities............................................... 445,409 466,622 381,833
Obligations under capital leases, excluding current portion (Note 3)......... 36,390 38,541 31,876
Long-term debt, payable to related parties (Note 4).......................... 287,362 293,107 353,607
-------- -------- -----------
Total liabilities....................................................... 769,161 798,270 767,316
-------- -------- -----------
Commitments (Notes 3 and 5)
Stockholders' Deficit:
Common stock, no par value. Authorized, issued and outstanding 200
shares.................................................................. 17,000 17,000 17,000
Accumulated deficit........................................................ (490,165) (457,128) (441,178)
-------- -------- -----------
Total stockholders' deficit............................................. (473,165) (440,128) (424,178)
-------- -------- -----------
Total liabilities and stockholders' deficit............................. $295,996 $358,142 $ 343,138
-------- -------- -----------
-------- -------- -----------
</TABLE>

See accompanying notes to financial statements.

F-15

<PAGE>
PR DATA SYSTEMS, INC.
STATEMENTS OF OPERATIONS AND ACCUMULATED DEFICIT

<TABLE>
<CAPTION>
YEARS ENDED SIX MONTHS
DECEMBER 31, ENDED JUNE 30,
------------------------ ----------------------
1994 1995 1995 1996
---------- ---------- --------- ---------
(UNAUDITED)
<S> <C> <C> <C> <C>
Revenues................................ $1,669,783 $1,691,603 $ 808,557 $ 843,788
Direct expenses......................... 344,961 263,133 141,947 116,006
---------- ---------- --------- ---------
Gross profit....................... 1,324,822 1,428,470 666,610 727,782
Selling, general and administrative
expenses.............................. 1,377,169 1,354,019 657,611 681,763
---------- ---------- --------- ---------
Operating (loss) income............ (52,347) 74,451 8,999 46,019
Interest expense........................ (38,401) (40,799) (33,410) (29,486)
---------- ---------- --------- ---------
(Loss) income before income
taxes............................ (90,748) 33,652 (24,411) 16,533
Income taxes (Note 6)................... 624 615 365 583
---------- ---------- --------- ---------
Net (loss) income.................. (91,372) 33,037 (24,776) 15,950
Accumulated deficit at beginning of
period................................ (398,793) (490,165) (490,165) (457,128)
---------- ---------- --------- ---------
Accumulated deficit at end of period.... $ (490,165) $ (457,128) $(514,941) $(441,178)
---------- ---------- --------- ---------
---------- ---------- --------- ---------
</TABLE>
See accompanying notes to financial statements.

F-16

<PAGE>
PR DATA SYSTEMS, INC.
STATEMENTS OF CASH FLOWS

(INFORMATION AS OF JUNE 30, 1996 AND INFORMATION RELATING TO THE
SIX MONTHS ENDED JUNE 30, 1996 AND 1995 IS UNAUDITED.)

<TABLE>
<CAPTION>
YEARS ENDED SIX MONTHS
DECEMBER 31, ENDED JUNE 30,
-------------------- --------------------
1994 1995 1995 1996
-------- -------- -------- --------
(UNAUDITED)
<S> <C> <C> <C> <C>
Cash flows from operating activities:
Net (loss) income................................................ $(91,372) $ 33,037 $(24,776) $ 15,950
Adjustments to reconcile net (loss) income to net cash
provided by operating activities:
Depreciation and amortization................................. 10,118 17,840 10,620 13,664
Provision for doubtful accounts............................... 22,000 21,007 9,667 658
Loss on disposition of equipment and vehicles................. 675 1,143 1,143 --
Decrease (increase) in accounts receivable.................... 5,523 (49,398) 77,798 (4,749)
Decrease in prepaid expenses.................................. 745 397 1,561 1,423
(Decrease) increase in accounts payable....................... (11,309) (3,201) 4,975 (3,443)
Increase in amounts payable to related parties................ 31,925 39,673 (57,556) (2,311)
(Decrease) increase in accrued salaries....................... (888) 1,145 (169) 2,063
Decrease in other accrued expenses............................ (2,060) (1,253) 13,512 1,653
Increase in deferred revenue.................................. 51,806 2,250 (5,534) (54,056)
Increase (decrease) in income taxes payable................... 645 (280) (530) (266)
Increase in security deposits................................. (4,237) (1,696) (1,696) --
-------- -------- -------- --------
Net cash provided by operating activities................ 13,571 60,664 29,015 (29,414)
-------- -------- -------- --------
Cash flows from investing activities:
Capital expenditures for property and equipment.................. -- (35,554) (13,684) --
-------- -------- -------- --------
Net cash used in investing activities.................... -- (35,554) (13,684) --
-------- -------- -------- --------

Cash flows from financing activities:
Proceeds of borrowings from stockholders......................... 71,410 45,240 745 60,500
Proceeds of other borrowings..................................... 24,900 63,000 -- --
Principal payments on borrowings from stockholders............... (56,400) (39,495) -- --
Principal payments on loan from Small Business Administration.... (29,760) (32,013) (15,592) (16,929)
Principal payments under capital lease obligations............... (693) (11,417) (5,567) (6,665)
Principal payments on other borrowings........................... (24,900) (51,500) -- (11,500)
-------- -------- -------- --------
Net cash used in financing activities.................... (15,443) (26,185) (20,414) 25,406
-------- -------- -------- --------
Net decrease in cash..................................... (1,872) (1,075) (5,083) (4,008)
Cash at beginning of period........................................ 6,955 5,083 5,083 4,008
-------- -------- -------- --------
Cash at end of period.............................................. $ 5,083 $ 4,008 $ -- $ --
-------- -------- -------- --------
-------- -------- -------- --------
Supplemental schedule of noncash investing and financing
activities:
Acquisition of equipment under capital lease.................. $ 45,389 $ 16,960
-------- --------
-------- --------
Supplemental disclosures of cash flow information:
Cash paid during the year for:
Interest...................................................... $ 15,298 $ 29,343
-------- --------
-------- --------
Income taxes.................................................. $ 250 $ 250
-------- --------
-------- --------
</TABLE>
See accompanying notes to financial statements.

F-17

<PAGE>
PR DATA SYSTEMS, INC.
NOTES TO FINANCIAL STATEMENTS

INFORMATION AS OF JUNE 30, 1996 AND INFORMATION RELATING TO THE
SIX MONTHS ENDED JUNE 30, 1996 AND 1995 IS UNAUDITED.

(1) SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

(a) Description of Business

PR Data Systems, Inc. ('PR Data') is engaged in public relations services,
including the distribution of news releases to media and reporting on the
effectiveness of such releases in meeting the customers' requirements.

(b) Revenue Recognition

Fees earned for the distribution of news releases are recognized when the
services are performed and billed. PR Data typically enters into annual
agreements with customers under which it reports on the effectiveness of news
releases. Fees earned under these arrangements are recognized ratably over the
term of the agreement.

Property and equipment are stated at cost. Depreciation is calculated
principally on a straight-line basis over the estimated useful lives of the
assets. Equipment held under capital leases is amortized on a straight-line
basis over the lease term. Costs paid to a consultant to develop certain
databases used by PR Data have been deferred and are being amortized over five
years.

(d) Deferred Loan Costs

Costs incurred in obtaining a loan from the Small Business Administration
have been deferred and are being amortized over the term of the loan (six
years).

(e) Income Taxes

Income taxes are accounted for under the asset and liability method.
Deferred tax assets and liabilities are recognized for the future tax
consequences attributable to differences between the financial statement
carrying amounts of existing assets and liabilities and their respective tax
bases and operating loss and tax credit carryforwards. Deferred tax assets and
liabilities are measured using enacted tax rates expected to apply to taxable
income in the years in which those temporary differences are expected to be
recovered or settled. The effect on deferred tax assets and liabilities of a
change in tax rates is recognized in income in the period that includes the
enactment date. PR Data makes an allowance for deferred tax assets to the extent
that management considers that some portion or all of such assets will not be
realized.

(f) Financial Instruments

The fair value of financial instruments at December 31, 1994 and 1995
approximates cost due to the relatively short maturities of such instruments.

(g) Use of Estimates

Management of PR Data has made a number of estimates and assumptions
relating to the reporting of assets and liabilities and the disclosure of
contingent assets and liabilities to prepare these financial statements in
conformity with generally accepted accounting principles. Actual results could
differ from those estimates.

(h) Unaudited Interim Financial Statements

In the opinion of management, the unaudited interim balance sheet as of
June 30, 1996 and the related statements of operations and accumulated deficit
and cash flows for the six months ended June 30, 1995 and 1996 have been
prepared on the same basis as the audited financial statements contained herein
and include all adjustments, consisting only of normal recurring adjustments,
necessary for a fair presentation of the financial information set forth
therein. The results of operations for the six months ended June 30, 1996 are
not necessarily indicative of the results that may be expected for the year end
December 31, 1996.

F-18
<PAGE>
PR DATA SYSTEMS, INC.
NOTES TO FINANCIAL STATEMENTS--(CONTINUED)

INFORMATION AS OF JUNE 30, 1996 AND INFORMATION RELATING TO THE
SIX MONTHS ENDED JUNE 30, 1996 AND 1995 IS UNAUDITED.

(2) PROPERTY AND EQUIPMENT

Property and equipment consist of the following:

<TABLE>
<CAPTION>
1994 1995
--------- ---------
<S> <C> <C>
Copier equipment held under capital leases......................... $ 45,389 $ 62,349
Office furniture................................................... 20,982 22,332
Office and computer equipment and software......................... 226,548 222,160
--------- ---------
292,919 306,841
Less accumulated depreciation...................................... (238,027) (216,540)
--------- ---------
$ 54,892 $ 90,301
--------- ---------
--------- ---------
</TABLE>

Depreciation expenses amounted to $10,118 and $17,840 in 1994 and 1995,
respectively.

(3) OBLIGATIONS UNDER CAPITAL LEASES

Minimum future lease payments under capital leases at December 31, 1995
are:

<TABLE>
<CAPTION>
YEAR ENDING DECEMBER 31,
- ---------------------------------------------------------------
<S> <C>
1996........................................................... $14,963
1997........................................................... 14,963
1998........................................................... 14,963
1999........................................................... 17,919
2000........................................................... 351
-------
Total minimum lease payments................................... 63,159
Less amount representing interest.............................. (12,919)
-------
Present value of net minimum lease payments.................... $50,240
Less amount currently due...................................... (11,699)
-------
$38,541
-------
-------
</TABLE>

(4) LONG-TERM DEBT

Long-term debt consists of the following:

<TABLE>
<CAPTION>
1994 1995
-------- --------
<S> <C> <C>
Small Business Administration loan due August 31, 1998................ $136,455 $104,442
Stockholders' loans................................................... 287,362 293,107
-------- --------
423,817 397,549
Less current portion.................................................. 136,455 104,442
-------- --------
Long-term portion, net................................................ $287,362 $293,107
-------- --------
-------- --------
</TABLE>

The Small Business Administration loan bears interest at 2 1/4% over prime
(10 3/4% at December 31, 1995) and is payable in monthly installments over the
term of the loan. The loan is guaranteed by the officers and secured by third
mortgages on their residences and assignment of proceeds under the officers'

life insurance policies. Restrictive covenants include maintaining a current
ratio of not less than 1.5 to 1 at the end of any fiscal quarter and contain
limits as to officers' salary increases and paydowns on stockholder loans. PR
Data did not meet the current ratio requirement at December 31, 1994 or 1995.
Consequently, the entire loan balance is classified as a current liability on
the accompanying balance sheets.

The stockholders' loans bear interest at 8 1/2% or 2% over prime (10 1/2%
at December 31, 1995) and have been classified as long term as the shareholders
agreed not to demand repayment before January 1, 1997.

F-19
<PAGE>
PR DATA SYSTEMS, INC.
NOTES TO FINANCIAL STATEMENTS--(CONTINUED)

INFORMATION AS OF JUNE 30, 1996 AND INFORMATION RELATING TO THE
SIX MONTHS ENDED JUNE 30, 1996 AND 1995 IS UNAUDITED.

(5) RELATED PARTY TRANSACTIONS

During March 1992, PR Data entered into a five-year lease expiring in
September 1996 for office space from a partnership 50% owned by certain
stockholders. The lease agreement calls for a monthly base rent of $12,175 plus
escalation charges for real estate taxes. These escalation charges totaled
$17,894 and $19,794 in 1994 and 1995, respectively. PR Data negotiated a
reduction in the monthly payments to $10,175 for the period April 1, 1994
through March 31, 1995.

During 1995, a partnership, 50% owned by certain stockholders of PR Data,
advanced funds without interest to cover short-term working capital needs of PR
Data.

At December 31, 1994 and 1995, amounts payable to related parties included
rent payable to a partnership 50% owned by certain stockholders of $30,922 and
$43,370, respectively, and interest on stockholders' loans of $49,785 and
$76,910, respectively.

(6) INCOME TAXES

Income tax expense attributable to income from continuing operations
consists of:

<TABLE>
<CAPTION>
CURRENT DEFERRED TOTAL
------- -------- -----
<S> <C> <C> <C>
Year ended December 31, 1994:
Federal............................................... $ -- $ -- $ --
State and local....................................... 624 -- 624
------- -------- -----
$ 624 $ -- $ 624
------- -------- -----
------- -------- -----
Year ended December 31, 1995:
Federal............................................... -- -- --
State and local....................................... 615 -- 615
------- -------- -----
$ 615 $ -- $ 615
------- -------- -----
------- -------- -----
</TABLE>

Income tax expense differs from the amount computed by multiplying the
statutory rate of 34% to income (loss) before income taxes due to the following:

<TABLE>
<CAPTION>
1994 1995
-------- --------
<S> <C> <C>
Income tax (benefit) expense at statutory rate............... $(30,854) $ 11,442
Increase (reduction) in income taxes resulting from:
State taxes, net of Federal tax deduction.................. (4,244) 1,827
Nondeductible expenses..................................... 218 1,507
Increase (decrease) in valuation allowance................. 35,873 (15,447)
Other...................................................... (369) 1,286
-------- --------
$ 624 $ 615
-------- --------
-------- --------
</TABLE>

The tax effects of temporary differences that give rise to significant
portions of the deferred tax assets and deferred tax liabilities at December 31,
1994 and 1995 are presented below:

<TABLE>
<CAPTION>
1994 1995
--------- ---------
<S> <C> <C>
Deferred tax assets:
Net operating loss carryforwards........................ $ 133,512 $ 125,780
Accounts receivable principally due to allowance for
doubtful accounts.................................... 10,356 7,729
Property and equipment, due to differences in
depreciation for book and tax purposes............... 4,509 (579)
Other................................................... 1,350 1,350
--------- ---------
149,727 134,280
--------- ---------
</TABLE>

F-20
<PAGE>
PR DATA SYSTEMS, INC.
NOTES TO FINANCIAL STATEMENTS--(CONTINUED)

INFORMATION AS OF JUNE 30, 1996 AND INFORMATION RELATING TO THE
SIX MONTHS ENDED JUNE 30, 1996 AND 1995 IS UNAUDITED.

(6) INCOME TAXES--(CONTINUED)

<TABLE>
<CAPTION>
1994 1995
--------- ---------
<S> <C> <C>
Less valuation allowance................................ (149,727) (134,280)
--------- ---------
Deferred tax assets, net of valuation allowance...... $ -- $ --
--------- ---------
--------- ---------
</TABLE>

At December 31, 1995, PR Data has net operating loss carryforwards for
Federal income tax purposes of $243,482 which are available to offset future
Federal taxable income, if any, through 2009.

The net change in the total valuation allowance for the years ended
December 31, 1994 and 1995 was an increase of $35,873 and a decrease of $15,447,
respectively. In assessing the realizability of deferred tax assets, management
considers whether it is more likely than not that some portion or all of the
deferred tax assets will not be realized. The ultimate realization of deferred
tax assets is dependent upon the generation of future taxable income during the
periods in which those temporary differences become deductible. Management

considers the scheduled reversal of deferred tax liabilities and projected
future taxable income in making this assessment. In order to fully realize the
deferred tax assets, PR Data will need to generate future taxable income of
approximately $324,000 prior to the expiration of the net operating loss
carryforwards in 2009. Based upon the level of historical taxable income (loss)
and projection for future taxable income over the periods in which the deferred
tax assets are deductible, management could not conclude that it is more likely
than not that PR Data will be able to realize the benefits of these deductible
differences and, accordingly, has provided a valuation allowance equal to the
excess of deferred tax assets over deferred tax liabilities.

(7) BUSINESS CONCENTRATION

During 1994 and 1995, PR Data generated revenue of $481,400 and $479,000,
respectively, from services provided to two customers. The total accounts
receivable balance at December 31, 1994 and 1995 relating to these customers was
$34,302 and $64,528, respectively.

(8) SUBSEQUENT EVENT

On July 18, 1996, PR Data completed an asset purchase agreement (the
'Agreement') with Medialink Worldwide Incorporated, formerly known as Video
Broadcasting Corporation ('Medialink'), a Delaware corporation, and Medialink PR
Data Corporation (the 'Purchaser'), a Delaware corporation which is a wholly
owned subsidiary of Medialink.

Under the terms of the Agreement, the Purchaser acquired all of PR Data's
tangible and intangible assets for cash of $120,000 and through the issuance of
24,000 shares of Common Stock valued at $155,000. The purchaser also assumed all
of the obligations and liabilities of PR Data as at the closing date with the
exception that such obligations and liabilities assumed could not exceed the
book value of assets acquired by more than $372,000.

The Purchaser also entered into noncompete agreements with PR Data's
principal officers and stockholders. These agreements are for periods of five
years and provide for quarterly payments aggregating $410,000 during this
period.

F-21

<PAGE>
MEDIALINK WORLDWIDE INCORPORATED
UNAUDITED PRO FORMA CONDENSED COMBINED FINANCIAL STATEMENTS

The following Unaudited Pro Forma Condensed Combined Statements of
Operations for the nine months ended September 30, 1996 and the year ended
December 31, 1995 illustrates the effect of the PR Data Acquisition. The
Unaudited Pro Forma Condensed Combined Statements of Operations assumes that the
PR Data Acquisition occurred at the beginning of the periods presented.

Pursuant to the terms of the PR Data Acquisition, the Company issued 24,000
shares of Common Stock, made a cash payment of $120,000 and assumed certain
liabilities not to exceed the book value of assets acquired by more than
$372,000. In addition, the Company will make quarterly payments in the aggregate
amount of $410,000 payable over the next five years under the terms of
non-compete agreements with certain officers and stockholders of PR Data. The
transaction was accounted for as a purchase. The Unaudited Pro Forma Condensed
Combined Financial Statements also reflect the pay down of PR Data's existing
Small Business Administration loan in the amount of approximately $89,000 and
the conversion of long-term debt and certain other obligations of PR Data to its
stockholders into a new note in the amount of $330,000 which occurred
immediately following the consummation of the PR Data Acquisition.

The pro forma adjustments are based upon currently available information
and upon certain assumptions that management believes are reasonable. The PR
Data Acquisition has been recorded based upon the estimated fair market value of
the net tangible and intangible assets acquired at the date of the acquisition.
The adjustments included in the Unaudited Pro Forma Condensed Combined Financial
Statements represent management's preliminary determination of these adjustments
based upon available information. There can be no assurance that the actual
adjustments will not differ significantly from the pro forma adjustments
reflected in the pro forma financial information.

The Unaudited Pro Forma Condensed Combined Financial Statements are not
necessarily indicative of either future results of operations or results that
might have been achieved if the foregoing transaction had been consummated as of
the indicated dates. The Unaudited Pro Forma Condensed Combined Financial
Statements should be read in conjunction with the historical financial
statements of Medialink and PR Data included elsewhere herein, together with the
related notes thereto.

F-22

<PAGE>

MEDIALINK WORLDWIDE INCORPORATED
UNAUDITED PRO FORMA CONDENSED COMBINED STATEMENT OF OPERATIONS
NINE MONTHS ENDED SEPTEMBER 30, 1996

<TABLE>
<CAPTION>
MEDIALINK PR DATA PRO FORMA
HISTORICAL HISTORICAL ADJUSTMENTS PRO FORMA
----------- ---------- ----------- -----------

<S> <C> <C> <C> <C>
Revenues............................................ $11,158,239 $928,154 $ (2,133)(1) $12,014,388
(69,872)(2)
Direct costs........................................ 4,604,668 161,875 (69,872)(2) 4,696,671
----------- ---------- ----------- -----------
Gross profit...................................... 6,553,571 766,279 (2,133) 7,317,717
General and administrative expenses................. 5,548,433 724,361 24,447(3) 6,306,696
27,083(4)
(17,628)(5)
----------- ---------- ----------- -----------
Operating income.................................. 1,005,138 41,918 (36,035) 1,011,021
Other income (expense)
Interest expense.................................. (14,674) (32,761) (3,480)(6) (45,910)
5,005(7)
Interest and other income......................... 19,144 0 19,144
----------- ---------- ----------- -----------
Income before income taxes........................ 1,009,608 9,157 (34,510) 984,255
Income tax expense.................................. 430,738 916 (14,632)(8) 417,022
----------- ---------- ----------- -----------
Net income.......................................... $ 578,870 $ 8,241 $ (19,878) $ 567,233
----------- ---------- ----------- -----------
----------- ---------- ----------- -----------
Net income per common and common equivalent share... $ 0.16(9)
-----------
-----------
</TABLE>

See accompanying notes to unaudited pro forma condensed combined financial
statements.

F-23

<PAGE>
MEDIALINK WORLDWIDE INCORPORATED
UNAUDITED PRO FORMA CONDENSED COMBINED STATEMENT OF OPERATIONS

<TABLE>
<CAPTION>
YEAR ENDED DECEMBER 31, 1995
--------------------------------------------------------
MEDIALINK PR DATA PRO FORMA
HISTORICAL HISTORICAL ADJUSTMENTS PRO FORMA
----------- ---------- ----------- -----------
<S> <C> <C> <C> <C>
Revenues.............................................. $10,624,680 $1,691,603 $ (8,229)(1) $12,237,144
(70,910)(2)
Direct costs.......................................... 4,553,349 263,133 (70,910)(2) 4,745,572
----------- ---------- ----------- -----------
Gross profit........................................ 6,071,331 1,428,470 (8,229) 7,491,572
General and administrative expenses................... 5,373,307 1,354,019 39,143(3) 6,786,155
50,000(4)
(30,314)(5)
----------- ---------- ----------- -----------
Operating income.................................... 698,024 74,451 (67,058) 705,417
Other income (expense)
Inerest expense..................................... -- (40,799) 4,972(6) (26,587)
9,240(7)
Interest and other income........................... 15,273 -- 15,273
----------- ---------- ----------- -----------
Income before income taxes.......................... 713,297 33,652 (52,846) 694,103
Income tax expense.................................... 332,062 615 (12,696)(8) 319,981
----------- ---------- ----------- -----------
Net income............................................ $ 381,235 $ 33,037 $ (40,150) $ 374,122
----------- ---------- ----------- -----------
----------- ---------- ----------- -----------
Pro forma net income per common and common equivalent
share............................................... $ 0.11(9)
-----------
-----------
</TABLE>

See accompanying notes to unaudited pro forma condensed combined financial
statements.

F-24

<PAGE>
MEDIALINK WORLDWIDE INCORPORATED
NOTES TO UNAUDITED PRO FORMA CONDENSED COMBINED FINANCIAL STATEMENTS

(1) Reflects the elimination of management fee income of PR Data from a related
party that will no longer be earned after the PR Data Acquisition.

(2) Reflects the elimination of fees for services paid to PR Data by Medialink.

(3) Reflects the amortization expenses of the excess of cost over the fair value
of the net tangible liabilities acquired in the PR Data Acquisition by use
of the straight-line method over 15 years.

(4) Reflects the amortization of the value assigned to various non-compete
agreements with certain officers and stockholders of PR Data.

(5) Reflects the adjustment to the salaries of the former officers and
stockholders of PR Data under the terms of their new employment agreements
with Medialink effective after the PR Data Acquisition.

(6) Reflects the effect of interest due on the note due to a stockholder of PR
Data in the principal amount of $330,000.

(7) Reflects the reduction in interest expense as a result of the payoff of the
Small Business Administration loan at the closing of the PR Data
Acquisition.

(8) Reflects the tax effect of the pro forma adjustments at Medialink's
effective tax rate.

(9) See Note 9 to the Company's Financial Statements for an explanation of the
method used to determine the pro forma net income per common and common
equivalent share.

F-25

<PAGE>

CASE STUDIES DESCRIPTION OF PHOTOS

PEPSI

Illustration shows man standing in front of assembly line on which soft drink
cans are being filled.

Pepsi was the target of rumors regarding product tampering in its soft drink
cans. Pepsi decided to counter these allegations by showing the public the
conditions under which the beverage was manufactured and packaged. VNRs were
produced to accomplish that, and were distributed by Medialink to TV stations
nationwide. Medialink's monitoring indicated that the releases achieved a
cumulative audience of 488 million over a one-week period.

GENERAL MILLS

General Mills wished to celebrate the 75th anniversary of the Betty Crocker
brand by unveiling the latest modernization "makeover" of the Betty Crocker
image. This was a significant corporate event, and management sought to
generate a maximum amount of news coverage. Medialink broadcast the ceremony at
which the new likeness was presented; conducted a Satellite Media Tour that
reached TV stations around the nation; and produced a VNR to extend the story's
reach. Medialink's monitoring indicated a cumulative audience of 42 million.

Illustration shows man standing in front of framed portrait of likeness of Betty
Crocker.

SPEEDO INTERNATIONAL

Illustration shows newscaster with three women in swimsuits.

This major swimwear manufacturer sought to introduce products made from a new
proprietary fabric, Aquablade(R), that, according to scientific tests reported
by Speedo, could increase a swimmer's speed by as much as 8%. This line was set
for release in Europe, Australia and Latin America. The challenge was to prepare
and distribute "master" material that could be readily adapted by TV stations
in numerous countries taking into account local languages and customs. This was
accomplished by coordinating the efforts of Medialink's international network of
affiliates. Medialink's monitoring indicated a cumulative audience of 174
million in 12 countries.

MEDIALINK

<PAGE>

[LOGO]

2,000,000 SHARES
COMMON STOCK

PROSPECTUS

DEAN WITTER REYNOLDS INC.
WHEAT FIRST BUTCHER SINGER

, 1996

<PAGE>
PART II

INFORMATION NOT REQUIRED IN PROSPECTUS

ITEM 13. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION.

The following table sets forth the costs and expenses, other than
underwriting discounts and commissions, payable by the Registrant in connection
with the sale of the Common Stock being registered. All items are estimated
except the SEC registration and NASD and NASDAQ filing fees.

<TABLE>
<S> <C>
SEC registration fee........................................... $ 7,667
NASD filing fee................................................ 3,030
NASDAQ fee..................................................... 30,120
Blue Sky fees and expenses..................................... 10,000
Printing and engraving expenses................................ *
Legal fees and expenses........................................ *
Accounting fees and expenses................................... *
Transfer agent fees............................................ *
Miscellaneous.................................................. *
-------
Total..................................................... $ *
-------
-------
</TABLE>

- ------------------
* To be filed by amendment.

ITEM 14. INDEMNIFICATION OF DIRECTORS AND OFFICERS.

Section 145 of the Delaware General Corporation Law (the 'DGCL') provides
that a corporation may indemnify directors and officers as well as other
employees and individuals against expenses (including attorneys' fees),
judgments, fines and amounts paid in settlement in connection with specified
actions, suits or proceedings, whether civil, criminal, administrative or
investigative (other than an action by or in the right of the corporation--a
'derivative action'), if they acted in good faith and in a manner they
reasonably believed to be in or not opposed to the best interests of the
corporation, and, with respect to any criminal action or proceeding, had no
reasonable cause to believe their conduct was unlawful. A similar standard is
applicable in the case of derivative actions, except that indemnification only
extends to expenses (including attorneys' fees) incurred in connection with the
defense or settlement of such actions, and the statute requires court approval
before there can be any indemnification where the person seeking indemnification
has been found liable to the corporation. The statute provides that it is not
exclusive of other indemnification that may be granted by a corporation's
charter, by-laws, disinterested director vote, stockholder vote, agreement or
otherwise.

Article Ninth of the Company's Amended and Restated Certificate of
Incorporation provides that each person who was or is made a party to (or is
threatened to be made a party to) or is otherwise involved in any civil or
criminal action, suit or proceeding by reason of the fact that such person is or
was a director or officer of the Company shall be indemnified and held harmless
by the Company to the fullest extent authorized by Section 145 of the DGCL
against all expense, liability and loss (including without limitation attorneys'
fees) incurred by such person in connection therewith.

Article Ninth of the Company's Amended and Restated Certificate of
Incorporation provides that, to the fullest extent permitted by the DGCL, the
Company's directors will not be personally liable to the Company or its
stockholders for monetary damages resulting from a breach of their fiduciary
duty as directors. However, nothing contained in such Article Ninth shall
eliminate or limit the liability of directors (i) for any breach of the
director's duty of loyalty to the Company or its stockholders, (ii) for acts or
omissions not in good faith or which involve intentional misconduct or a knowing
violation of the law, (iii) under Section 174 of the DGCL or (iv) for any
transaction from which the director derived an improper personal benefit.

Article XI of the Registrant's Amended and Restated By-Laws provides that
each person who was or is made 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

II-1
<PAGE>
director, officer, employee or agent of the Registrant or is or was serving at
the request of the Registrant as a director, officer, employee or agent of
another corporation or of a partnership, joint venture, trust or other
enterprise, whether the basis of such proceeding is alleged action in an
official capacity as a director, officer, employee or agent or in any other
capacity while serving as a director, officer, employee or agent, shall be
indemnified and held harmless by the Registrant to the fullest extent authorized
by the Delaware General Corporation Law, as the same exists or may hereafter be
amended, against all expense, liability and loss (including attorneys' fees,
judgments, fines, ERISA excise taxes or penalties and amounts paid in
settlement) reasonably incurred or suffered by such indemnitee in connection
therewith. Such indemnification shall continue as to an indemnitee who has
ceased to be a director, officer, employee or agent and shall inure to the
benefit of the indemnitee's heirs, executors and administrators.

The Company has entered into indemnification agreements with each of its
current directors and officers, which provide for indemnification of, and
advancement of expenses to, such persons to the greatest extent permitted by
Delaware law, including by reason of action or inaction occurring in the past,
and circumstances in which indemnification and advancement of expenses to such
persons are permitted or are discretionary to the greatest extent under Delaware
law.

Subsequent to the consummation of this offering, the Company intends to
maintain directors and officers liability insurance covering all directors and
officers of the Company against claims arising out of the performance of their

duties.

ITEM 15. RECENT SALES OF UNREGISTERED SECURITIES.

The following information is furnished with regard to all securities sold
by the Company within the past three years which were not registered under the
Securities Act. Amounts have been restated to reflect a 1.2 for 1 stock split of
the Common Stock effected in the form of a stock dividend on July 31, 1996.
These transactions were private transactions not involving a public offering and
were exempt from the registration provisions of the Securities Act pursuant to
Section 4(2) or Rule 701 thereof. Options granted to employees were granted
pursuant to the Company's stock option plans. Options granted to non-employee
directors were granted pursuant to the Directors Stock Option Plan.

On July 18, 1996, the Company granted to William Wubbenhorst, Jack
Schoonover and Nancy Schoonover stock options to purchase an aggregate of 24,000
shares of Common Stock at an exercise price of $6.46 per share, pursuant to
stock option agreements executed in connection with the PR Data Acquisition.

On July 18, 1996, the Company issued to William Wubbenhorst, Jack
Schoonover and Nancy Schoonover an aggregate of 24,000 shares of Common Stock,
valued at an aggregate of $155,000, pursuant to the Asset Purchase Agreement
executed in connection with the PR Data Acquisition.

In March 1996, the Company issued 2,521 shares of Common Stock to David
Davis, pursuant to a consulting agreement between the Company and The Davis
Partnership, a partnership which is beneficially owned by Mr. Davis.

On February 15, 1996, the Company granted to non-employee directors of the
Company stock options to purchase 62,400 shares of Common Stock at an exercise
price of $3.54 per share.

On July 1, 1995 and February 1, 1996, the Company granted to Laurence
Moskowitz stock options to purchase 9,600 and 92,400 shares of Common Stock,
respectively, at exercise prices of $2.29 and $3.54 per share, respectively.

On July 1, 1995 and February 1, 1996, the Company granted to J. Graeme
McWhirter stock options to purchase 8,400 and 76,394 shares of Common Stock,
respectively, at exercise prices of $2.29 and $3.54 per share, respectively.

On July 1, 1995 and February 1, 1996, the Company granted to Mark Manoff
stock options to purchase 7,200 and 39,700 shares of Common Stock, respectively,
at exercise prices of $2.29 and $3.54 per share, respectively.

II-2
<PAGE>
On July 1, 1995 and February 1, 1996, the Company granted to Nicholas F.
Peters stock options to purchase 7,200 and 39,400 shares of Common Stock,
respectively, at exercise prices of $2.29 and $3.54 per share, respectively.

On July 1, 1995 and February 1, 1996, the Company granted to Mary Buhay
stock options to purchase 3,600 and 6,800 shares of Common Stock, respectively,
at exercise prices of $2.29 and $3.54 per share, respectively.

On February 1, 1996, the Company granted to employees stock options to
purchase 132,800 shares of Common Stock at an exercise price of $3.54 per share.

On July 1, 1995, the Company granted to employees stock options to purchase
39,000 shares of Common Stock at an exercise price of $2.29.

On March 1, 1994, the Company granted to David Davis stock options to
purchase 14,400 shares of Common Stock at an exercise price of $1.25 per share.

ITEM 16. EXHIBITS AND FINANCIAL STATEMENT SCHEDULES.

(a) Exhibits

<TABLE>
<CAPTION>
EXHIBIT
NUMBER DESCRIPTION
- ---------- --------------------------------------------------------------------------------------------------------
<S> <C>
**1.1 -- Form of Underwriting Agreement.

**3.1 -- Amended and Restated Certificate of Incorporation of Medialink Worldwide Incorporated (the
'Company').

*3.2 -- Amended and Restated By-Laws of the Company.

**4.1 -- Specimen Stock Certificate.

**5.1 -- Legal Opinion of Tashlik, Kreutzer & Goldwyn P.C.

*10.1 -- Asset Purchase Agreement, dated July 18, 1996, between Medialink PR Data Corporation, Video
Broadcasting Corporation, PR Data Systems, Inc., Jack Schoonover, William Wubbenhorst and Nancy
Schoonover.

**10.2 -- Employment Agreement, dated , 1996 by and between Medialink Worldwide Incorporated
and Laurence Moskowitz.

**10.3 -- Employment Agreement, dated , 1996 by and between Medialink Worldwide Incorporated
and J. Graeme McWhirter.

**10.4 -- Employment Agreement, dated , 1996 by and between Medialink Worldwide Incorporated
and David Davis.

**10.5 -- Employment Agreement, dated , 1996 by and between Medialink Worldwide Incorporated
and Nicholas F. Peters.

**10.6 -- Employment Agreement, dated , 1996 by and between Medialink Worldwide Incorporated
and Mark Manoff.

**10.7 -- Employment Agreement, dated , 1996 by and between Medialink Worldwide Incorporated
and Mark Weiner.

**10.8 -- Employment Agreement, dated , 1996 by and between Medialink Worldwide Incorporated
and Mary Buhay.

*10.9 -- Non-Negotiable Subordinated Promissory Note, dated July 18, 1996, between Medialink PR Data
Corporation and William Wubbenhorst.

*10.10 -- Lease, dated July 18, 1996, between Oakwood Avenue Partners and Medialink PR Data Corporation.
</TABLE>

II-3
<PAGE>

*10.12 -- Lease Modification Agreement, dated December 1995 between Clemons Properties Partners and Video
Broadcasting Corporation.

*10.13 -- Second Lease Modification Agreement, dated March 4, 1996, between Clemons Properties Partners and
Video Broadcasting Corporation.

*10.14 -- Third Lease Modification Agreement, dated May, 1996, between Clemons Properties Partners and Video
Broadcasting Corporation.

*10.15 -- Sublease, dated April 1, 1996, between Video Broadcasting Corporation and Media on Demand, Inc.

*10.16 -- Lease, dated October 1, 1990, between 1401 New York Avenue, Inc. and Video Broadcasting
Corporation.

*10.17 -- First Amendment of Lease, dated March 25, 1996, between 1401 New York Avenue, Inc. and Video
Broadcasting Corporation.

*10.19 -- Office Lease, dated June 7, 1989, between Teachers' Retirement System of the State of Illinois and
Video Broadcasting Corporation.

*10.20 -- First Amendment to Lease, dated June 1, 1994 between Teachers' Retirement System of the State of
Illinois and Video broadcasting Corporation.

*10.21 -- Office Lease, dated May 5, 1994, between Copperfield Investment & Development Company and Video
Broadcasting Corporation.

*10.22 -- First Amendment to Lease, dated September 15, 1994, between Copperfield Investment & Development
Company and Video Broadcasting Corporation.

*10.23 -- Lease Agreement, dated November 14, 1994, between City & Corporate Counsel Limited and Video
Broadcasting Corporation Inc.

*10.24 -- Underlease, dated February 9, 1995, between City & Corporate Counsel Limited and Video
Broadcasting Corporation Inc.

*10.25 -- Agreement, dated March 6, 1996, between Medialink, Inc. and ABC Radio Networks, Inc.

*10.26 -- Agreement, dated February 9, 1993, between Video Broadcasting Corporation and
NewsWorthy(Registered).

*10.27 -- Renewal of Agreement, dated February 21, 1995, between Video Broadcasting Corporation and
NewsWorthy(Registered).

*10.28 -- Amended and Restated AP Express Agreement, dated November 1, 1992, between Press Association, Inc.
and Video Broadcasting Corporation.

*10.29 -- Addendum, dated February 21, 1996, to the AP Express Agreement, between Press Association, Inc.
and Video Broadcasting Corporation.

*10.30 -- Satellite Services Agreement, dated January 1, 1996, between Global Access Telecommunication
Services, Inc. and Medialink.

*10.31 -- Nielsen Sigma Service Agreement, dated September 14, 1994, between Video Broadcasting Corp. and
A.C. Nielsen Company.
</TABLE>

II-4

<PAGE>

*10.33 -- Video Broadcasting Corporation 401(k) Tax Deferred Savings Plan.

*10.34 -- Amended and Restated Stock Option Plan and form of Stock Option Agreement.

*10.35 -- Video Broadcasting Corporation 1996 Directors Stock Option Plan and form of 1996 Directors Stock
Option Agreement.

*10.36 -- Form of Indemnification Agreement.

*10.37 -- Consulting Agreement by and between Video Broadcasting Corporation and Davis Partnership dated
March 1, 1994.

**10.38 -- Tower Place Office Lease by and between Tower Place, L.P. and Medialink Worldwide Incorporated,
dated , 1996.

*21.1 -- List of Subsidiaries of the Company.

23.1 -- Consent of KPMG Peat Marwick LLP.

**23.2 -- Consent of Tashlik, Kreutzer & Goldwyn P.C. (contained in the opinion to be filed as Exhibit 5.1
hereto).

*24.1 -- Power of Attorney.
</TABLE>

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

* Previously filed.

** To be filed by amendment

(b) Financial Statement Schedules

Not applicable

ITEM 17. UNDERTAKINGS.

The undersigned Registrant hereby undertakes to provide to the Underwriters
at the closing specified in the Underwriting Agreement certificates in such
denominations and registered in such names as required by the Underwriters to

permit prompt delivery to each purchaser.

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 provisions described in Item 14, or otherwise, the
Registrant has been advised that, in the opinion of the Securities and Exchange
Commission, such indemnification is against public policy as expressed in the
Securities Act of 1933 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 of 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.

The undersigned Registrant hereby undertakes that:

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

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

II-5

<PAGE>
SIGNATURES

Pursuant to the requirements of the Securities Act of 1933, the Registrant
has duly caused this Pre-Effective Amendment No. 1 to Form S-1 Registration
Statement to be signed on its behalf by the undersigned, thereunto duly
authorized, in the City of New York, State of New York, on the 31st day of
October, 1996.

MEDIALINK WORLDWIDE INCORPORATED

By: /s/ LAURENCE MOSKOWITZ
Laurence Moskowitz
Chairman of the Board, President
and Chief Executive Officer

Pursuant to the requirements of the Securities Act of 1933, this
Pre-Effective Amendment No. 1 to Form S-1 Registration Statement has been signed
by the following persons in the capacities indicated below on the 31st day of
October, 1996.

<TABLE>
<S> <C>
/s/ LAURENCE MOSKOWITZ Chairman of the Board, President and Chief Executive Officer
Laurence Moskowitz (Principal Executive Officer)

* Executive Vice President, Chief Financial Officer and Assistant
J. Graeme McWhirter Secretary (Principal Financial and Accounting Officer)

* Senior Vice President/International, Director
David Davis

* Director
Harold Finelt

* Director
Donald Kimelman

* Director
James J. O'Neill

* Director
Gerald P. Rodeen

* Director
Theodore Wm. Tashlik

*By: /s/ LAURENCE MOSKOWITZ
Laurence Moskowitz
Attorney-in-Fact
by Power of Attorney
dated October 15, 1996
</TABLE>

II-6

<PAGE>
EXHIBIT INDEX

<TABLE>
<CAPTION>
EXHIBIT
NUMBER DESCRIPTION
- ---------- ---------------------------------------------------------------------------------------------
<S> <C>
**1.1 -- Form of Underwriting Agreement.
**3.1 -- Amended and Restated Certificate of Incorporation of Medialink Worldwide Incorporated
(the 'Company').
*3.2 -- Amended and Restated By-Laws of the Company.
**4.1 -- Specimen Stock Certificate.
**5.1 -- Legal Opinion of Tashlik, Kreutzer & Goldwyn P.C.
*10.1 -- Asset Purchase Agreement, dated July 18, 1996, between Medialink PR Data Corporation,
Video Broadcasting Corporation, PR Data Systems, Inc., Jack Schoonover, William
Wubbenhorst and Nancy Schoonover.
**10.2 -- Employment Agreement, dated , 1996 by and between Medialink Worldwide
Incorporated and Laurence Moskowitz.
**10.3 -- Employment Agreement, dated , 1996 by and between Medialink Worldwide
Incorporated and J. Graeme McWhirter.
**10.4 -- Employment Agreement, dated , 1996 by and between Medialink Worldwide
Incorporated and David Davis.
**10.5 -- Employment Agreement, dated , 1996 by and between Medialink Worldwide
Incorporated and Nicholas F. Peters.
**10.6 -- Employment Agreement, dated , 1996 by and between Medialink Worldwide
Incorporated and Mark Manoff.
**10.7 -- Employment Agreement, dated , 1996 by and between Medialink Worldwide
Incorporated and Mark Weiner.
**10.8 -- Employment Agreement, dated , 1996 by and between Medialink Worldwide
Incorporated and Mary Buhay.
*10.9 -- Non-Negotiable Subordinated Promissory Note, dated July 18, 1996, between Medialink PR
Data Corporation and William Wubbenhorst.
*10.10 -- Lease, dated July 18, 1996, between Oakwood Avenue Partners and Medialink PR Data
Corporation.
*10.11 -- Lease, dated September 21, 1994, between Clemons Properties Partner and Video
Broadcasting Corporation.
*10.12 -- Lease Modification Agreement, dated December , 1995 between Clemons Properties
Partners and Video Broadcasting Corporation.
*10.13 -- Second Lease Modification Agreement, dated March 4, 1996, between Clemons Properties
Partners and Video Broadcasting Corporation.
*10.14 -- Third Lease Modification Agreement, dated May, 1996, between Clemons Properties
Partners and Video Broadcasting Corporation.
*10.15 -- Sublease, dated April 1, 1996, between Video Broadcasting Corporation and Media on
Demand, Inc.
*10.16 -- Lease, dated October 1, 1990, between 1401 New York Avenue, Inc. and Video Broadcasting
Corporation.
*10.17 -- First Amendment of Lease, dated March 25, 1996, between 1401 New York Avenue, Inc. and
Video Broadcasting Corporation.

*10.18 -- Lease, dated January 3, 1994, between Continental Bank, N.A., as Trustee for the
Allstate Retirement Plan and Continental Bank, N.A., as Trustee for the Agents Pension
Plan and Video Broadcasting Corporation.
*10.19 -- Office Lease, dated June 7, 1989, between Teachers' Retirement System of the State of
Illinois and Video Broadcasting Corporation.
*10.20 -- First Amendment to Lease, dated June 1, 1994 between Teachers' Retirement System of the
State of Illinois and Video broadcasting Corporation.
</TABLE>

<PAGE>

<TABLE>
<CAPTION>
EXHIBIT
NUMBER DESCRIPTION
- ---------- ---------------------------------------------------------------------------------------------
<S> <C>
*10.21 -- Office Lease, dated May 5, 1994, between Copperfield Investment & Development Company
and Video Broadcasting Corporation.
*10.22 -- First Amendment to Lease, dated September 15, 1994, between Copperfield Investment &
Development Company and Video Broadcasting Corporation.
*10.23 -- Lease Agreement, dated November 14, 1994, between City & Corporate Counsel Limited and
Video Broadcasting Corporation Inc.
*10.24 -- Underlease, dated February 9, 1995, between City & Corporate Counsel Limited and Video
Broadcasting Corporation Inc.
*10.25 -- Agreement, dated March 6, 1996, between Medialink, Inc. and ABC Radio Networks, Inc.
*10.26 -- Agreement, dated February 9, 1993, between Video Broadcasting Corporation and
NewsWorthy(Registered).
*10.27 -- Renewal of Agreement, dated February 21, 1995, between Video Broadcasting Corporation
and NewsWorthy(Registered).
*10.28 -- Amended and Restated AP Express Agreement, dated November 1, 1992, between Press
Association, Inc. and Video Broadcasting Corporation.
*10.29 -- Addendum, dated February 21, 1996, to the AP Express Agreement, between Press
Association, Inc. and Video Broadcasting Corporation.
*10.30 -- Satellite Services Agreement, dated January 1, 1996, between Global Access
Telecommunication Services, Inc. and Medialink.
*10.31 -- Nielsen Sigma Service Agreement, dated September 14, 1994, between Video Broadcasting
Corp. and A.C. Nielsen Company.
*10.32 -- Loan Modification Agreement, dated February 28, 1996, between Video Broadcasting
Corporation and Silicon Valley Bank.
*10.33 -- Video Broadcasting Corporation 401(k) Tax Deferred Savings Plan.
*10.34 -- Amended and Restated Stock Option Plan and form of Stock Option Agreement.
*10.35 -- Video Broadcasting Corporation 1996 Directors Stock Option Plan and form of 1996
Directors Stock Option Agreement.
*10.36 -- Form of Indemnification Agreement.
*10.37 -- Consulting Agreement by and between Video Broadcasting Corporation and Davis
Partnership dated March 1, 1994.
**10.38 -- Tower Place Office Lease by and between Tower Place, L.P. and Medialink Worldwide
Incorporated, dated , 1996.

*21.1 -- List of Subsidiaries of the Company.
23.1 -- Consent of KPMG Peat Marwick LLP.
**23.2 -- Consent of Tashlik, Kreutzer & Goldwyn P.C. (contained in the opinion to be filed as
Exhibit 5.1 hereto).
*24.1 -- Power of Attorney.
</TABLE>

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

* Previously filed

** To be filed by amendment

<PAGE>
EXHIBIT 23.1

The Board of Directors
Medialink Worldwide Incorporated:

We consent to the use of our reports included herein and to the reference to our
firm under the heading 'Experts' in the prospectus.

KPMG PEAT MARWICK LLP

New York, New York
October 31, 1996