SHOWPOWER INC, 424B4, 1998-06-16

SHOWPOWER INC
424B4, 1998-06-16
EQUIPMENT RENTAL & LEASING, NEC

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PROSPECTUS

1,200,000 SHARES

[LOGO OMITTED]

COMMON STOCK

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

All of the 1,200,000 shares of Common Stock, $.01 par value per share (the
'Common Stock'), of Showpower, Inc. ('Showpower' or the 'Company') offered
hereby are being sold for the account of the Company. Prior to this offering
(the 'Offering'), there has been no public market for the Common Stock. See
'Underwriting' for a discussion of the factors to be considered in determining
the public offering price.

The Common Stock has been approved for listing on The American Stock
Exchange (the 'AMEX') under the symbol 'SHO'.

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

SEE 'RISK FACTORS' BEGINNING ON PAGE SEVEN FOR A DISCUSSION OF CERTAIN
FACTORS THAT SHOULD BE CONSIDERED BY PROSPECTIVE PURCHASERS OF THE SHARES OF
COMMON STOCK.
------------------------

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.
<TABLE>
<CAPTION>
<S> <C> <C> <C>
=========================================================================================================
PRICE TO UNDERWRITING DISCOUNTS PROCEEDS TO
THE PUBLIC AND COMMISSIONS(1) THE COMPANY(2)
<S> <C> <C> <C>
- ---------------------------------------------------------------------------------------------------------
Per Share....................... $11.00 $0.77 $10.23
- ---------------------------------------------------------------------------------------------------------
Total(3)........................ $13,200,000 $924,000 $12,276,000
=========================================================================================================
</TABLE>

(1) Does not include a 3% non-accountable expense allowance payable to Prime
Charter Ltd. (the 'Representative') and warrants to purchase 120,000 shares
of Common Stock issuable to the Representative (the 'Representative
Warrants'). In addition, the Company has agreed to indemnify the
Underwriters for certain liabilities under the Securities Act of 1933, as
amended. See 'Underwriting.'
(2) Before deducting expenses payable by the Company (including the
Representative's non-accountable expense allowance) estimated at $1,056,000
($1,115,400 if the Underwriters' over-allotment option is exercised in
full). See 'Use of Proceeds.'
(3) The Company has granted the Underwriters a 30-day option to purchase up to
an aggregate of 180,000 additional shares of Common Stock at the Price to
the Public, less the Underwriting Discounts and Commissions, solely to cover
over-allotments, if any. If the Underwriters exercise such option in full,
the total Price to the Public, Underwriting Discounts and Commissions, and
Proceeds to the Company will be $15,180,000, $1,062,600 and $14,117,400,
respectively. See 'Underwriting.'

The shares of Common Stock offered hereby are offered subject to receipt
and acceptance by the Underwriters, to prior sale and to the right to reject any
order in whole or in part and to withdraw, cancel or modify the offer without
notice and certain other conditions. It is expected that delivery of the shares
of Common Stock offered hereby will be made on or about June 19, 1998.

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

PRIME CHARTER LTD.

THE DATE OF THIS PROSPECTUS IS JUNE 16, 1998.
<PAGE>

[MAP OF WORLD INDICATING
LOCATIONS OF BRANCH OFFICES
AND SELECTED 1997 - 1998 PROJECT SITES]

[POTOGRAPH OF EQUIPMENT]

CERTAIN PERSONS PARTICIPATING IN THIS OFFERING MAY ENGAGE IN TRANSACTIONS
THAT STABILIZE, MAINTAIN OR OTHERWISE AFFECT THE PRICE OF THE COMMON STOCK,
INCLUDING BY ENTERING STABILIZING BIDS, EFFECTING SYNDICATE COVERING
TRANSACTIONS OR IMPOSING PENALTY BIDS. FOR A DESCRIPTION OF THESE ACTIVITIES,
SEE 'UNDERWRITING.'

2
<PAGE>
PROSPECTUS SUMMARY

The following summary is qualified in its entirety by the more detailed
information and financial statements, including the notes thereto, appearing
elsewhere in this Prospectus. Investors should carefully consider the
information set forth under 'Risk Factors.' Unless otherwise indicated, the
information in this Prospectus: (i) gives effect to the Company's
reincorporation in Delaware; (ii) assumes no exercise of the Underwriters'
over-allotment option, the Representative Warrants or options outstanding under
the Company's 1998 Stock Option and Incentive Plan; and (iii) reflects a
754-for-one stock split of the Common Stock, which occurred on April 6, 1998. As
used in this Prospectus, unless the context indicates otherwise, the terms the
'Company' and 'Showpower' refer to Showpower, Inc., its immediate predecessor
and its subsidiaries.

THE COMPANY

Showpower provides temporary power generation and temperature control
rental equipment and support services on a worldwide basis for entertainment,
corporate and special events. The Company's customers include corporations,
event producers, television networks, motion picture studios, performers and
facility operators that need electric power and/or temperature control services
to support events at locations where these services are inadequate or
unavailable. In addition to rental equipment, the Company provides fully
integrated, value-added services, including planning, technical advice,
customized installation, and on-site operation and support personnel. The
Company's power equipment consists of transportable, diesel-powered electricity
generators contained in acoustic enclosures and related power distribution
equipment. Temperature control equipment consists of transportable,
electrically-driven heating, ventilation and air conditioning ('HVAC') units.

The Company believes that its competitive advantages include the
relationships and name recognition it has established in the entertainment and
related industries and its ability to deploy and manage complex equipment
systems throughout the world. The Company believes that it will benefit from
certain trends within its target markets, including: (i) recognition among
customers that short-term equipment rental and support services provide a
cost-effective alternative to equipment ownership and related in-house support
capability; and (ii) growth in activities such as corporate sponsorship, live
television broadcasting and product promotions.

Initially, the Company provided power generation and distribution services
only for concert touring artists. In recent years, the Company has broadened its
customer base to include large-scale corporate and special events, live
television broadcasts, motion pictures, trade shows and conventions and has
expanded its capabilities to include temperature control services. The Company
has also expanded its operations geographically through acquisitions and by
opening new branch offices in order to capitalize on the worldwide growth in its
markets.

Showpower services three primary markets:

o Corporate and Special Events. Showpower services have been or will
be used by or in events for Pope John Paul II, the 1997 Presidential
Inauguration, The Walt Disney Company, the 1998 World Cup in France,
Nike, Inc., Microsoft Corporation, Deutsche Telekom, Inc., General
Motors Corporation, NASCAR, Paramount Pictures Corporation, the 1996
Republican National Convention, the Hong Kong Handover Ceremonies
and the National Football League.

o Concert Touring. The Company has provided services for the worldwide
concert tours of such artists as The Rolling Stones, U2, Elton John,
Billy Joel, Garth Brooks, Yanni, David Bowie, the Three Tenors,
Fleetwood Mac, Jimmy Buffet, Luciano Pavarotti, Madonna, Paul
McCartney, Bruce Springsteen, Pink Floyd and Spice Girls, as well as
touring festivals such as Lollapalooza.

o Television and Motion Pictures. Showpower has provided services to
all major U.S. broadcast and cable networks and many non-U.S.
networks in connection with more than 500 live broadcast events,
including the summer and winter Olympic Games, the 1997 World Track
and Field Championships and other special broadcast events. The
Company also has provided services to major award shows, including
the Grammy Awards and European Music Awards. Recent film projects
have included Volcano, Dante's Peak, Starship Troopers, Broken Arrow
and Godzilla.

3
<PAGE>
The Company's business strategy is to expand its rental service
capabilities and geographic scope, domestically and internationally, by: (i)
purchasing additional power generation and temperature control equipment; (ii)
enhancing existing customer relationships and attracting new business; (iii)
opening new branch offices; (iv) acquiring rental service businesses; and (v)
broadening the range of services it offers at existing branch offices. Showpower
intends to use a significant portion of the proceeds of the Offering to increase
the amount of equipment it owns, thereby significantly reducing the expense the
Company incurs in renting equipment for use in its customers' projects. In 1997,
rental expense was $2,810,241, or 16%, of revenue.

The Company's predecessor, Showpower, Inc., a California corporation, was
incorporated in 1991 to purchase the assets of a division of a theatrical
lighting company that had provided temporary power generation for touring
artists. In March 1998, the Company was reincorporated in Delaware. The
Company's principal executive offices are located at 18128 South Santa Fe
Avenue, Rancho Dominguez, California 90221. The Company's phone number is (310)
604-9676.

THE OFFERING

<TABLE>
<S> <C>
Common Stock offered hereby............... 1,200,000 shares
Common Stock to be outstanding after the
Offering................................ 3,241,842 shares
Use of proceeds........................... The net proceeds will be used to
acquire power generation,
electrical distribution and
temperature control equipment,
repay secured indebtedness, and for
other general corporate purposes.
See 'Use of Proceeds.'

AMEX symbol............................... SHO
</TABLE>

4
<PAGE>
SUMMARY CONSOLIDATED FINANCIAL INFORMATION
(DOLLARS IN THOUSANDS, EXCEPT PER SHARE DATA)

<TABLE>
<CAPTION>
THREE MONTHS ENDED
YEARS ENDED DECEMBER 31, MARCH 31,
------------------------ --------------------
1996 1997(1) 1997(1) 1998
------- ------- ------- ------
<S> <C> <C> <C> <C>
INCOME STATEMENT DATA:
Revenue................................................... $11,567 $17,294 $ 2,460 $4,273
Cost of sales............................................. 7,609 9,790 1,419 2,452
------- ------- ------- ------
Gross profit.............................................. 3,958 7,504 1,041 1,821
Selling, general and administrative expenses.............. 3,552 6,179 1,061 1,627
Stock compensation........................................ -- 107 -- 36
------- ------- ------- ------
Income (loss) from operations(2)(3)....................... 406 1,218 (20) 158
Other income and (expense)................................ (233) (171) (37) (114)
------- ------- ------- ------
Income (loss) before income taxes......................... 173 1,047 (57) 44
Income tax provision (benefit)............................ 1 116 (18) (41)
------- ------- ------- ------
Net income (loss)......................................... $ 172 $ 931 $ (39) $ 85
------- ------- ------- ------
------- ------- ------- ------

Basic net income (loss) per share......................... $ 0.17 $ 0.54 $ (0.03) $ 0.04
Diluted net income (loss) per share....................... 0.17 0.52 (0.03) 0.04

PRO FORMA DATA:(4)
Income (loss) before income taxes......................... $ 173 $ 1,047 $ (57) $ 44
Pro forma income tax provision (benefit).................. 70 415 (15) 63
------- ------- ------- ------
Pro forma net income (loss)............................... $ 103 $ 632 $ (42) $ (19)
------- ------- ------- ------
------- ------- ------- ------

Pro forma basic net income (loss) per share............... $ 0.10 $ 0.37 $ (0.04) $(0.01)
Pro forma diluted net income (loss) per share............. 0.10 0.35 (0.04) (0.01)
Supplemental pro forma basic net income (loss) per
share(5)................................................ $ -- $ 0.35 -- $(0.01)
Supplemental pro forma diluted net income (loss) per
share(5)................................................ -- 0.34 -- (0.01)

OTHER FINANCIAL DATA:
EBITDA(6)................................................. $ 1,469 $ 2,354 $ 226 $ 532
Net cash provided by (used in) operating activities....... 969 2,363 (128) (503)
Net cash used in investing activities..................... 1,801 4,018 2,284 249
Net cash provided by financing activities................. 847 1,955 2,568 544
Capital expenditures, including non-cash items............ 1,699 2,903 178 2,555
Equipment rental expense.................................. 2,307 2,810 310 761
</TABLE>

5
<PAGE>

<TABLE>
<CAPTION>
AS OF MARCH 31, 1998
AS OF --------------------------------------------
DECEMBER 31, PRO FORMA
1997 ACTUAL PRO FORMA(7) AS ADJUSTED(7)(8)
------------ ------- ------------ -----------------
<S> <C> <C> <C> <C>
SELECTED BALANCE SHEET DATA:
Working capital (deficit)............................... $ (1,608) $(1,860) $ (2,460) $ 6,190
Current assets.......................................... 2,341 2,336 2,336 9,388
Total assets............................................ 11,725 14,287 14,287 21,339
Current liabilities..................................... 3,949 4,196 4,796 3,198
Long-term liabilities................................... 2,470 4,683 5,408 2,838
Total liabilities....................................... 6,419 8,879 10,204 6,036
Stockholders' equity.................................... 5,306 5,408 4,083 15,303
</TABLE>

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

(1) Includes the results of operations of Templine subsequent to its acquisition
on March 17, 1997.

(2) Includes a $417,048 reduction in the amount of depreciation and amortization
resulting from the change in 1997 in the estimated useful lives of certain
depreciable assets.

(3) Includes $162,800 of income recognized in January 1997 which was
attributable to a joint venture terminated in 1997. See 'Management's
Discussion and Analysis of Financial Condition and Results of Operations'
and Consolidated Financial Statements and notes related thereto.

(4) Reflects the termination of the Company's S Corporation status. The pro
forma income statement data reflect provisions for federal and state income
taxes as if the Company's U.S. operations had been subject to federal and
state income taxation as a C Corporation at an assumed 40% combined federal
and state income tax rate during the periods presented. See 'S Corporation
Conversion.'

(5) Gives effect, as of the beginning of 1997, to an assumed issuance of 64,171
shares in connection with the $600,000 distribution to the Company's
existing stockholders for purposes of calculating supplemental pro forma net
income per share. See 'Use of Proceeds' and 'S Corporation Conversion.'

(6) EBITDA is calculated herein as earnings before income taxes plus
depreciation, amortization and interest expense. The Company believes EBITDA
serves as an important financial analysis tool for measuring and comparing
financial information such as liquidity, operating performance and leverage.
EBITDA should not be considered an alternative to net income or other cash
flow measures determined under generally accepted accounting principles as
an indicator of the Company's performance or liquidity. EBITDA as disclosed
herein may not be comparable to EBITDA as disclosed by other companies.

(7) Reflects the assumed conversion to C Corporation status, the establishment
of $725,000 of related deferred income taxes and distributions, immediately
prior to the Offering, of approximately $600,000 to the Company's existing
stockholders, representing taxes payable by such stockholders as a result of
the Company's historical treatment as an S Corporation.

(8) Gives effect to the receipt of the net proceeds of the sale of 1,200,000
shares of Common Stock offered hereby at a public offering price of $11.00
per share and the repayment of certain indebtedness. See 'Use of Proceeds'
and 'Capitalization.'

6
<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.

UNPREDICTABLE NATURE OF BUSINESS

The Company provides its services on a project-by-project basis and future
demand for its services cannot be predicted with any certainty. Although many
projects provide revenues over an extended period of time, projects may have
differing levels of profitability. Showpower does not have agreements with its
clients which require them to utilize the Company on an ongoing basis. In
addition, revenue derived from triennial, quadrennial or special events has had
in the past, and is expected to have in the future, a significant effect on the
Company's revenue and income, causing the Company's revenue and operating
results to fluctuate from quarter to quarter. For example, revenue derived from
two events, the Atlanta Olympic Games and the Republican National Convention,
accounted for approximately $3,825,000, or 33%, of revenue in 1996.
Consequently, the unpredictable timing, duration and profitability of projects,
the presence of large triennial and quadrennial events, such as the World Cup,
Olympics and national elections, the unpredictable timing, duration and scale of
corporate promotions and other special events, and general national and
international economic conditions may have an adverse effect on future operating
results which may be material. Accordingly, operating results in any quarter
should not be considered indicative of results for the year or any future
periods.

DEPENDENCE ON ENTERTAINMENT INDUSTRY

A significant amount of the Company's business is derived from customers in
the entertainment and related industries. Spending by the public on
entertainment generally is considered highly discretionary and thus may be
adversely affected by general national and international economic or other
conditions or extraordinary events beyond the Company's control. Reduced
expenditures in the entertainment industry generally or significant reductions
in entertainment expenditures by the Company's customers or the general public
could have a material adverse effect on the Company. Concert touring customers
accounted for 21% and 23% of the Company's revenue in 1996 and 1997,
respectively. The concert touring business depends on the popularity and
commercial appeal of performing artists and their willingness to perform in
large arena and stadium venues around the world. Historically, a relatively
small number of performers has had sufficient commercial potential to make such
tours viable. There can be no assurance that these performers or others will
sustain the historical level of activity in the concert touring market or, if
they do, that they, or the promoters of their concerts, will continue to use
Showpower's services.

MANAGEMENT OF GROWTH; RISKS ASSOCIATED WITH ACQUISITIONS

The Company's business strategy is to expand by opening new branch offices,
acquiring existing businesses in new or existing markets and broadening the
range of services the Company offers at branch offices. Since September 1996,
the Company has made three acquisitions and has opened branch offices in the
United States, the United Kingdom and Brazil. This expansion has resulted in an
increase in the number of its employees and increased responsibility for
management. The Company's success depends to a significant extent on the ability
of its management, which has had limited management experience with public
companies, to manage growth and operate effectively. The Company's growth
strategy includes pursuing acquisitions in the rental services industry. The
success of the Company's acquisition 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
and operations into its organization effectively, to retain and motivate key
personnel and to retain the customers of acquired businesses. 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 shares of 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 for future acquisitions. The Company has no current
agreements or commitments and is not currently engaged in active negotiations
with respect to any acquisitions.

7
<PAGE>
DEPENDENCE ON KEY SUPPLIER

Beginning in 1992, the Company began using Caterpillar, Inc.
('Caterpillar') as its principal supplier of power generation equipment. The
Company has also established a credit relationship with a finance affiliate of
Caterpillar, as well as relationships and arrangements with certain independent
Caterpillar dealers (the 'Caterpillar Dealers') under which the Caterpillar
Dealers acquire, maintain and rent power generation and temperature control
equipment to the Company for use in the Company's projects. The Company
considers its relationships with Caterpillar, Caterpillar's finance affiliate
and the Caterpillar Dealers to be mutually beneficial. Although management
believes that adequate alternative sources of rental equipment and financing
exist, an abrupt termination or change in the nature of Showpower's
relationships with Caterpillar, Caterpillar's finance affiliate or the
Caterpillar Dealers could adversely affect the Company's ability to implement
its expansion strategy. See 'Business.'

DEPENDENCE ON MANAGEMENT

Certain of the executive officers of the Company, particularly John J.
Campion, Chief Executive Officer, and Laurence Anderson, President, are of
significant importance to the direction and management of the Company. The loss
of the services of such persons could have a material adverse effect on the
Company's business and future operations, and there can be no assurance that the
Company would be able to find replacements with comparable business experience.
The Company maintains key man insurance on the lives of Messrs. Campion and
Anderson in the amounts of $2,000,000 and $1,000,000, respectively. The Company
believes that its future success also will depend on its ability to retain,
motivate and attract additional managerial, operational, technical and sales
personnel. There can be no assurance that the Company will be successful in
retaining, attracting or training the personnel it requires to develop, assemble
and operate its equipment, market and provide its services or expand its
operations. See 'Management.'

RISKS OF FOREIGN OPERATIONS

In 1997, foreign branch office operations accounted for 14% of the
Company's revenue and it is a part of the Company's strategy to increase its
foreign operations. While management believes its non-U.S. operations provide
seasonal diversification as well as diversification from dependence on the U.S.
economy, operations and investments in some foreign countries are subject to
political and business risks. The nature of these risks varies from country to
country and from time to time. The overall effect of the foregoing on the
Company cannot be predicted with any certainty.

The Company provides services on a worldwide basis, primarily to U.S.-based
customers, on terms denominated in U.S. dollars. In addition, Templine, the
Company's United Kingdom subsidiary, conducts most of its business in British
pounds sterling. The Company recently commenced operations in Brazil, where it
conducts business in Brazilian reals. The overall impact of foreign currency
fluctuations cannot be predicted with any certainty. Historically, Brazil has
experienced significant inflation and fluctuation in the value of its currency.
Despite a recent decline in the rate of inflation and a reduction in currency
volatility in Brazil, there can be no assurance that such improvements will
continue over the long term.

COMPETITION

The Company faces significant competition in virtually all of its
geographical and product markets from general equipment rental companies,
specialized equipment rental companies, original equipment manufacturers
('OEMs') and their dealers or distributors. The Company also faces competition
from utility companies and from local and national electrical and HVAC
contractors. There are no significant barriers to entry into the power
generation and temperature control rental markets. Competition is based
primarily on the reputation, service quality, availability of equipment, and
price. Many of the Company's competitors are much larger and have greater
development, marketing and financial resources. There can be no assurance that
the Company will be able to compete successfully in its markets or that
competitive pressures will not have a material adverse effect on the Company.
See 'Business--Competition.'

8
<PAGE>
ABSENCE OF LONG-TERM CONTRACTS

The Company's customers generally retain the Company on a
project-by-project basis rather than under long-term contracts. Although
assignments from existing customers represented a significant portion of the
Company's revenue for 1997, there can be no assurance that a customer will
continue to use the Company in the future. To the extent that a large number of
the Company's current customers do not continue to use the Company's services,
and the Company is unable to attract new customers or extend existing customer
relationships, there would be a material adverse effect on the Company's
financial results.

CONTROL OF THE COMPANY BY EXISTING STOCKHOLDERS

After the sale of the shares of Common Stock offered hereby, the Company's
executive officers and directors will in the aggregate beneficially own
approximately 57% of the Company's outstanding Common Stock (54% if the
Underwriters' over-allotment option is exercised in full). Accordingly, such
persons, if they choose to act together, will be able to elect a majority of the
directors and exercise control over the business, policies and affairs of the
Company. Similarly, such persons, acting together, would be in a position to
prevent a takeover of the Company by one or more third parties, which could
deprive the Company's stockholders of a control premium that might otherwise be
realized by them in connection with an acquisition of the Company. See
'Principal Stockholders.'

SUBSTANTIAL AND IMMEDIATE DILUTION

The initial public offering price is substantially higher than the pro
forma net tangible book value per share of Common Stock. Investors purchasing
shares of Common Stock in the Offering will be subject to immediate dilution in
net tangible book value of $6.69 per share. See 'Dilution.'

CERTAIN TRANSACTIONS

The Company has engaged in, and expects to continue to engage in business
transactions with entities controlled by certain directors and stockholders of
the Company. Management believes that such transactions have been on terms no
less favorable to the Company than could have been obtained from unaffiliated
parties. See 'Certain Transactions.'

GOVERNMENT AND ENVIRONMENTAL REGULATION

The Company and its operations are subject to numerous federal, state and
local laws and regulations governing, among other things, worker safety, air
emissions, water discharge and the generation, handling, storage,
transportation, treatment and disposal of hazardous substances and wastes. Under
laws and regulations relating to air emissions, the Company is required to
operate equipment within strict standards, and is required in certain areas,
such as southern California, to obtain operating permits for individual
generator sets. The Company expects that it, and other operators of equipment
utilizing diesel engines, will, in the future, become subject to stricter air
emissions standards, including requirements that engine manufacturers produce
cleaner-running products. In addition, the Company dispenses petroleum products
from temporary above-ground storage tanks at certain locations and operates
power generation equipment equipped with integral fuel tanks. There can be no
assurance, however, that these tanks have been or will at all times remain free
of leaks or that use of these tanks has not or will not result in releases. The
Company also uses hazardous materials such as solvents to clean and maintain its
rental equipment fleet. In addition, the Company generates and disposes waste
such as used motor oil, radiator fluid and solvents and may be liable under
various federal, state and local laws for environmental contamination at
facilities or project sites where its waste is or has been disposed. See
'Business-Government and Environmental Regulation.'

NO PRIOR PUBLIC MARKET; POSSIBLE VOLATILITY OF STOCK PRICE

Prior to the Offering, there has been no public market for the Common
Stock, and there can be no assurance that an active trading market will develop
as a result of the Offering or, if a trading market does develop, that it will
be sustained or that the shares of Common Stock could be resold at or above the
public offering price. After completion of the Offering, the market price of the
Common Stock could be subject to significant variation due to

9
<PAGE>
fluctuations in the Company's operating results, changes in earnings estimates
by securities analysts, the degree of success the Company achieves in
implementing its business and growth strategies, changes in business or
regulatory conditions affecting the Company, its customers or competitors, and
other factors. In addition, general economic, political and market conditions,
may adversely affect the market price of the Common Stock. The public offering
price of the Common Stock offered hereby has been determined through
negotiations between the Company and the Representative and may not be
indicative of the market price of the Common Stock after the Offering. See
'Underwriting.'

SHARES ELIGIBLE FOR FUTURE SALE

Upon consummation of the Offering, the Company will have outstanding
3,241,842 shares of Common Stock (3,421,842 shares if the Underwriters'
over-allotment option is exercised in full). Future sales of substantial amounts
of Common Stock (including 479,563 shares issuable upon the exercise of
outstanding stock options) by the Company's current stockholders after the
Offering, or the perception that such sales could occur, could adversely affect
the market price of the Common Stock. In addition, the Company has the authority
to issue additional shares of Common Stock and up to 1,000,000 shares of one or
more series of preferred stock (the 'Preferred Stock'). The issuance of such
shares could result in the dilution of the voting power of the shares of Common
Stock purchased in the Offering and could have a dilutive effect on earnings per
share. The future sales of shares, or the availability of shares for future
sale, could have an adverse effect on the market price of the Common Stock. The
Company currently has no plans to designate or issue any shares of Preferred
Stock.

The Company, its directors and executive officers, and certain current
stockholders have agreed, not to directly or indirectly sell, offer to sell,
solicit an offer to buy, contract to sell, pledge, grant any option for the sale
of shares of Common Stock or otherwise transfer or dispose of any shares of
Common Stock, or any security convertible into, or exercisable or exchangeable
for, such shares of Common Stock, for a period of one year after the
consummation of the Offering without the prior written consent of the
Representative. See 'Principal Stockholders,' 'Description of Capital Stock,'
'Shares Eligible for Future Sale' and 'Underwriting.'

DISCRETIONARY USE OF PROCEEDS

Although the Company anticipates utilizing the proceeds of this Offering as
stated herein, management will have broad discretion as to the actual uses of
such proceeds. Additionally, circumstances currently expected may change in the
future resulting in a reallocation of resources from that originally
contemplated. Approximately $6,000,000 of the proceeds received in this Offering
may be utilized to purchase power generation and temperature control equipment.
See 'Use of Proceeds.'

ANTI-TAKEOVER EFFECTS OF CERTAIN PROVISIONS OF DELAWARE LAW AND THE COMPANY'S
CERTIFICATE OF INCORPORATION AND BYLAWS

Certain provisions of the Delaware General Corporation Law (the 'DGCL') and
the Company's Certificate of Incorporation and Bylaws could have the effect of
making it more difficult for a third party to acquire, or of discouraging a
third party from attempting to acquire, control of the Company. Such provisions
could limit the price that investors might be willing to pay in the future for
the Common Stock.

Upon consummation of the Offering, the Board of Directors will be divided
into three classes, with each class serving a 'staggered' term of office of
three years. In addition, the Company's Bylaws include requirements for advance
notification for certain items of business at stockholder meetings and for
stockholder nominees of directors.

The Board of Directors of the Company has the authority to issue up to
1,000,000 shares of Preferred Stock and to determine the price, rights,
preferences, privileges and restrictions, including voting rights, of those
shares without any further vote or action by the stockholders. The rights of the
holders of Common Stock will 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. The issuance of Preferred Stock, could have the effect of making it more
difficult for a third party to acquire a majority of the outstanding voting
stock of the Company.

10
<PAGE>
In addition, the Company will, upon consummation of the Offering, be
subject to the anti-takeover provisions of Section 203 of the DGCL. In general,
this statute prohibits a publicly-held Delaware corporation from engaging in a
'business combination' with an 'interested stockholder' for a period of three
years after the date of the transaction in which the person became an interested
stockholder unless such business combination is approved by the Board of
Directors or the stockholders as set forth in the DGCL. See
'Management--Executive Officers and Directors,' 'Description of Capital
Stock--Preferred Stock' and '--Delaware Law and Limitations on Changes in
Control.'

DIVIDENDS UNLIKELY

The Company does not anticipate paying cash dividends on the Common Stock
in the foreseeable future (other than as described under 'S Corporation
Conversion') and anticipates that any future earnings will be retained to
finance the Company's operations and expansion. See 'Dividend Policy.'

FORWARD-LOOKING STATEMENTS

This Prospectus contains certain forward-looking statements and information
relating to the Company that are based on the beliefs of management as well as
assumptions made by, and information currently available to, the Company. When
used in this Prospectus, the words 'anticipate,' 'believe,' 'estimate,'
'expect,' 'will,' 'could,' 'may' and similar expressions, are intended to
identify forward-looking statements. Such statements reflect the current views
of management with respect to future events and are subject to certain risks,
uncertainties and assumptions, including those described in this Prospectus.
Should one or more of these risks or uncertainties materialize, or should
underlying assumptions prove incorrect, actual results may vary materially from
those described herein. In addition to the other information in this Prospectus,
the above factors should be carefully considered in evaluating the Company and
its business and before purchasing the Common Stock offered hereby.

11
<PAGE>
USE OF PROCEEDS

The net proceeds to the Company from the sale of the shares of Common Stock
offered hereby are estimated to be $11,220,000 ($13,002,000 if the Underwriters'
over-allotment option is exercised in full) after deducting underwriting
discounts and commissions of approximately $924,000 ($1,062,600 if the
Underwriters' over-allotment option is exercised in full) and expenses of the
Offering of approximately $1,056,000. The Company anticipates that the net
proceeds of the Offering will be applied substantially as follows:

<TABLE>
<CAPTION>
APPROXIMATE
ALLOCATION OF PROCEEDS DOLLAR AMOUNT PERCENT
----------------------- ------------- -------
<S> <C> <C>
Purchase of power generation and temperature control equipment........................... $ 6,000,000 54%
Repayment of indebtedness(1)............................................................. 3,900,000 35
Working capital.......................................................................... 720,000 6
Distribution to existing stockholders(2)................................................. 600,000 5
------------- -------
$11,220,000 100%
------------- -------
------------- -------
</TABLE>

- ------------------
(1) Consists primarily of notes payable to Caterpillar Financial Services Corp.,
bearing interest at rates from 9.2% to 9.3% per annum and maturing in 2002
through 2005 and two bank lines of credit bearing variable rates of interest
(8.4% and 9.8% at March 31, 1998, respectively) which mature in 1999. The
debt to be repaid was incurred in 1997 (approximately $1,087,000), during
the three months ended March 31, 1998 ($2,481,000) and thereafter
(approximately $332,000) primarily to acquire equipment.

(2) This amount approximates taxes paid or payable by the Company's existing
stockholders as a result of the Company's historical treatment as an S
Corporation. See 'S Corporation Conversion.'

The Company anticipates, based on currently proposed plans and assumptions
relating to its operations, that the proceeds of the Offering, together with
projected cash flow from operations, will be sufficient to satisfy its
contemplated cash requirements for at least 12 months following the consummation
of the Offering.

If the Underwriters' over-allotment option is exercised in full, additional
net proceeds of $1,782,000 will be added to working capital. Pending utilization
of the proceeds of the Offering, the Company may make temporary investments in
government securities or other short-term high quality, interest-bearing fixed
income investments.

S CORPORATION CONVERSION

The Company has been treated for federal and state income tax purposes as
an S Corporation under Subchapter S of the Internal Revenue Code of 1986, as
amended (the 'Code'), since 1991. As a result of the Company's status as an S
Corporation, the Company's stockholders, rather than the Company, have been
taxed directly on the earnings of the Company for federal and certain state
income tax purposes, whether or not such earnings were distributed.
Simultaneously with this Offering the Company will terminate its status as an S
Corporation and will thereafter be subject to federal and state income taxes at
applicable C Corporation rates.

DISTRIBUTIONS

Upon the termination of its Subchapter S status and its conversion to C
Corporation status, the Company will estimate the amount of undistributed 1998 S
Corporation earnings taxable to existing stockholders and make a distribution to
such stockholders of approximately 48% of that amount. The distribution is
estimated at approximately $600,000.

ACCOUNTING EFFECT

In connection with the conversion of its S Corporation status to C
Corporation status, the Company is required by Statement of Financial Accounting
Standards No. 109 to record deferred tax liabilities. Such change will result in
a net charge to earnings of approximately $800,000 in the second quarter of
1998. This one-time charge is a result of differences in the accounting and tax
treatment of certain of the Company's assets and liabilities and is reflected
through an increase in deferred income tax liabilities, $725,000 of which
relates to tax and accounting differences as of March 31, 1998.

12
<PAGE>
DIVIDEND POLICY

The Company does not anticipate paying any cash dividends on the Common
Stock in the foreseeable future (other than as described above under 'S
Corporation Conversion') and anticipates that any future earnings will be
retained to finance the Company's operations and expansion. The payment of cash
dividends in the future will be at the discretion of the Board of Directors and
will depend upon the Company's earnings levels, capital requirements,
restrictive loan covenants and other factors the Board of Directors may deem
relevant. The Company's bank line of credit agreement restricts payment of
dividends to 50% of net income.

DILUTION

The pro forma net tangible book value (total assets less total liabilities
and net intangible assets and after giving effect to deferred income taxes and
distribution to existing shareholders) of the Company's Common Stock at March
31, 1998 was $2,767,562 ($1.36 per share after giving effect to the 754-for-one
stock split).

Net tangible book value dilution per share represents the difference
between the amount per share paid by purchasers of shares of Common Stock in the
Offering and the net tangible book value per share of the Common Stock
immediately after consummation of the Offering. After giving effect to the
754-for-one stock split, the sale of 1,200,000 shares of Common Stock in the
Offering at a public offering price of $11.00 per share and the application of
the estimated net proceeds therefrom, the pro forma net tangible book value of
the Company as of March 31, 1998 would have been $13,987,562, or $4.31 per
share. See 'Use of Proceeds.' This represents an immediate increase in net
tangible book value of $2.95 per share to existing stockholders of the Company
and an immediate dilution in net tangible book value of $6.69 per share to
purchasers of Common Stock in the Offering, as illustrated in the following
table:

<TABLE>
<S> <C> <C>
Public offering price per share of Common Stock....................................... $11.00
Pro forma net tangible book value per share before giving effect to the Offering.... $1.36
Increase in pro forma net tangible book value per share attributable to new
investors........................................................................ 2.95
-----
Pro forma net tangible book value per share after giving effect to the Offering....... 4.31
------
Dilution per share to new investors................................................... $ 6.69
------
------
</TABLE>

The following table summarizes, as of March 31, 1998, after giving effect
to the Offering, the number of shares of Common Stock purchased from the
Company, the total consideration paid to the Company and the average price per
share paid by the existing stockholders and by new investors purchasing Common
Stock in the Offering based on a public offering price of $11.00 per share
before deducting underwriting discounts and estimated expenses of the Offering
payable by the Company.

<TABLE>
<CAPTION>
SHARES PURCHASED TOTAL CONSIDERATION
-------------------- ---------------------- AVERAGE PRICE
NUMBER PERCENT AMOUNT PERCENT PER SHARE
--------- ------- ----------- ------- -------------
<S> <C> <C> <C> <C> <C>
Existing stockholders............................... 2,041,842 63.0% $ 7,146,950 35.1% $ 3.50
New investors....................................... 1,200,000 37.0% 13,200,000 64.9% $ 11.00
--------- ------- ----------- -------
Total............................................. 3,241,842 100.0% $20,346,950 100.0%
--------- ------- ----------- -------
--------- ------- ----------- -------
</TABLE>

13
<PAGE>
CAPITALIZATION

The following table sets forth the capitalization of the Company on an
actual, pro forma and pro forma as adjusted basis as of March 31, 1998. The data
set forth below should be read in conjunction with the other financial
information presented elsewhere in this Prospectus. The following table gives
effect to the Company's reincorporation in Delaware and the 754-for-one stock
split.

<TABLE>
<CAPTION>
AS OF MARCH 31, 1998
--------------------------------------------
PRO FORMA
ACTUAL PRO FORMA(1) AS ADJUSTED(1)(2)
------- ------------ -----------------
(IN THOUSANDS)
<S> <C> <C> <C>
DEBT:
CURRENT:
Bank lines of credit............................................. $ 594 $ 594 $ --
Current portion of long-term debt................................ 1,039 1,039 635
Current portion of capital lease obligations..................... 104 104 104
Due to stockholders.............................................. -- 600 --
------- ------------ ----------
Total.......................................................... 1,737 2,337 739
LONG TERM:
Long-term debt................................................... 4,402 4,402 1,832
Capital lease obligations........................................ 41 41 41
------- ------------ ----------
Total.......................................................... 4,443 4,443 1,873
------- ------------ ----------
Total debt (including current portion)...................... 6,180 6,780 2,612
------- ------------ ----------
STOCKHOLDERS' EQUITY:
Preferred Stock, $.01 par value, 1,000,000 shares authorized; none
outstanding...................................................... -- -- --
Common Stock, $.01 par value:
Authorized shares--6,500,000 Actual, Pro Forma and Pro Forma As
Adjusted; outstanding shares--2,041,842 Actual and Pro Forma
and 3,241,842 Pro Forma As Adjusted............................ 20 20 32
Additional paid-in capital............................................ 6,694 6,694 17,902
Notes receivable from stockholders.................................... (489) (489) (489)
Cumulative foreign currency translation adjustment.................... 7 7 7
Accumulated deficit................................................... (824) (2,149) (2,149)
------- ------------ ----------
Total stockholders' equity....................................... 5,408 4,083 15,303
------- ------------ ----------
Total capitalization........................................... $11,588 $ 10,863 $17,915
------- ------------ ----------
------- ------------ ----------
</TABLE>

- ------------------
(1) Gives effect to conversion of the Company to C Corporation status and the
related tax distribution to existing stockholders.

(2) Gives effect to the receipt and the application of the estimated net
proceeds of the Offering to reduce indebtedness of approximately $3,568,000
outstanding at March 31, 1998, which will be repaid from the proceeds of the
Offering. See 'Use of Proceeds.'

14
<PAGE>
SELECTED CONSOLIDATED FINANCIAL INFORMATION
(DOLLARS IN THOUSANDS, EXCEPT PER SHARE DATA)

The financial data set forth below under the captions 'Income Statement
Data' and 'Other Financial Data' for the years ended December 31, 1996 and 1997,
and under the caption 'Selected Balance Sheet Data' as of December 31, 1997, are
derived from the consolidated financial statements of the Company, included
elsewhere in this Prospectus, audited by Deloitte & Touche LLP, independent
accountants. The financial data set forth below as of March 31, 1998 and for the
three months ended March 31, 1997 and 1998 have been derived from the unaudited
consolidated financial statements of the Company. In the opinion of the Company,
its unaudited consolidated financial statements have been prepared on the same
basis as the audited consolidated statements and include all adjustments
(consisting of normal recurring charges) necessary for a fair presentation of
the financial position and results of operations as of such dates and for the
three months then ended. The financial data for the three months ended March 31,
1998, are not necessarily indicative of results to be expected for the full
fiscal year. The data set forth below should be read in conjunction with the
Financial Statements and notes thereto included elsewhere in this Prospectus and
'Management's Discussion and Analysis of Financial Condition and Results of
Operations.' <TABLE> <CAPTION>
YEARS ENDED DECEMBER 31, THREE MONTHS ENDED MARCH 31,
--------------------------- ----------------------------
1996 1997(1) 1997(1)
-------- ---------- ----------------------------
<S> <C> <C> <C>
INCOME STATEMENT DATA:
Revenue..................................... $ 11,567 $ 17,294 $ 2,460
Cost of sales............................... 7,609 9,790 1,419
-------- ---------- ------------
Gross profit................................ 3,958 7,504 1,041
Selling, general and administrative
expenses.................................. 3,552 6,179 1,061
Stock compensation.......................... -- 107 --
-------- ---------- ------------
Income (loss) from operations(2)(3)......... 406 1,218 (20)
Other income and (expense).................. (233) (171) (37)
-------- ---------- ------------
Income (loss) before income taxes........... 173 1,047 (57)
Income tax provision (benefit).............. 1 116 (18)
-------- ---------- ------------
Net income (loss)........................... $ 172 $ 931 $ (39)
-------- ---------- ------------
-------- ---------- ------------
Basic net income (loss) per share........... $ 0.17 $ 0.54 $ (0.03)
Diluted net income (loss) per share......... 0.17 0.52 (0.03)
PRO FORMA DATA:(4)
Income (loss) before income taxes........... $ 173 $ 1,047 $ (57)
Pro forma income tax provision (benefit).... 70 415 (15)
-------- ---------- ------------
Pro forma net income (loss)................. $ 103 $ 632 $ (42)
-------- ---------- ------------
-------- ---------- ------------

Pro forma basic net income (loss) per
share..................................... $ 0.10 $ 0.37 $ (0.04)
Pro forma diluted net income (loss) per
share..................................... 0.10 0.35 (0.04)
Supplemental pro forma basic net income
(loss) per share(5)....................... $ -- $ 0.35 --
Supplemental pro forma diluted net income
(loss) per share(5)....................... -- 0.34 --
Shares used in computing basic net income
per share................................. 990,294 1,724,580 1,159,080
Shares used in computing diluted net income
per share................................. 990,294 1,801,143 1,159,080
OTHER FINANCIAL DATA:
EBITDA(6)................................... $ 1,469 $ 2,354 $ 226
Net cash provided by (used in) operating
activities................................ 969 2,363 (128)
Net cash used in investing activities....... 1,801 4,018 2,284
Net cash provided by financing activities... 847 1,955 2,568
Capital expenditures, including non-cash
items..................................... 1,699 2,903 178
Equipment rental expense.................... 2,307 2,810 310

1998
--------
<S> <C>
INCOME STATEMENT DATA:
Revenue..................................... $ 4,273
Cost of sales............................... 2,452
------------
Gross profit................................ 1,821
Selling, general and administrative
expenses.................................. 1,627
Stock compensation.......................... 36
------------
Income (loss) from operations(2)(3)......... 158
Other income and (expense).................. (114)
------------
Income (loss) before income taxes........... 44
Income tax provision (benefit).............. (41)
------------
Net income (loss)........................... $ 85
------------
------------
Basic net income (loss) per share........... $ 0.04
Diluted net income (loss) per share......... 0.04
PRO FORMA DATA:(4)
Income (loss) before income taxes........... $ 44
Pro forma income tax provision (benefit).... 63
------------
Pro forma net income (loss)................. $ (19)
------------
------------
Pro forma basic net income (loss) per
share..................................... $ (0.01)
Pro forma diluted net income (loss) per
share..................................... (0.01)
Supplemental pro forma basic net income
(loss) per share(5)....................... $ (0.01)
Supplemental pro forma diluted net income
(loss) per share(5)....................... (0.01)
Shares used in computing basic net income
per share................................. 1,913,080
Shares used in computing diluted net income
per share................................. 2,018,128
OTHER FINANCIAL DATA:
EBITDA(6)................................... $ 532
Net cash provided by (used in) operating
activities................................ (503)
Net cash used in investing activities....... 249
Net cash provided by financing activities... 544
Capital expenditures, including non-cash
items..................................... 2,555
Equipment rental expense.................... 761
</TABLE>

15
<PAGE>

<TABLE>
<CAPTION>
AS OF MARCH 31, 1998
AS OF --------------------------------------------
DECEMBER 31, PRO FORMA
1997 ACTUAL PRO FORMA(7) AS ADJUSTED(7)(8)
------------ ------- ------------ -----------------
<S> <C> <C> <C> <C>
SELECTED BALANCE SHEET DATA:
Working capital (deficit)............................. $ (1,608) $(1,860) $ (2,460) $ 6,190
Current assets........................................ 2,341 2,336 2,336 9,388
Total assets.......................................... 11,725 14,287 14,287 21,339
Current liabilities................................... 3,949 4,196 4,796 3,198
Long-term liabilities................................. 2,470 4,683 5,408 2,838
Total liabilities..................................... 6,419 8,879 10,204 6,036
Stockholders' equity.................................. 5,306 5,408 4,083 15,303
</TABLE>

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

(1) Includes the results of operations of Templine subsequent to its acquisition
on March 17, 1997.

(2) Includes a $417,048 reduction in the amount of depreciation and amortization
resulting from the change in 1997 in the estimated useful lives of certain
depreciable assets.

16
<PAGE>
MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS

The following discussion should be read in conjunction with the Company's
consolidated financial statements, including the related notes thereto, and
other financial information included herein. The following information also
includes forward-looking statements, the realization of which may be impacted by
certain important factors discussed under 'Risk Factors.'

OVERVIEW

Showpower provides temporary power generation and temperature control
rental equipment and support services on a worldwide basis for entertainment,
corporate and special events. The Company's customers include corporations,
event producers, television networks, motion picture studios, facility operators
and performers that need electric power and/or temperature control services to
support events at locations where these services are inadequate or unavailable.
In addition to rental equipment, the Company provides fully integrated,
value-added services, including planning, technical advice, customized
installations, on-site operations and support personnel. The Company's power
equipment consists of transportable, diesel-powered electricity generators
contained in acoustic enclosures and related power distribution equipment.
Temperature control equipment consists of transportable, electrically-driven
HVAC units.

The Company's predecessor, Showpower, Inc., a California corporation, was
formed in 1991 to purchase the assets of a division of a theatrical lighting
company that had provided temporary power generation and electrical distribution
services for touring artists since 1987. In 1992, the Company began providing
these services for live television broadcasts and large-scale special events. In
1995, the Company began providing power generation and distribution services to
the corporate special events industry and subsequently added temperature control
equipment and services. In 1997, the Company began to provide its services to
the motion picture, trade show and convention industries.

The Company has expanded geographically by making acquisitions and opening
new branch offices. During the third quarter of 1996, the Company acquired the
assets of a generator rental and electrical contracting company located in
Dallas, Texas and opened a corresponding branch office in Richardson, Texas. In
March 1997, the Company acquired Templine, headquartered in Bristol, England, to
expand its presence and scope of operations in Europe. In 1998, the Company
commenced operations in Brazil, and opened a branch office in Rio de Janeiro.
During the first quarter of 1998, the Company acquired the assets of a generator
rental company in Miami, Florida and opened a corresponding branch office in
Fort Lauderdale, Florida. During 1997, Templine and the Company's Texas branch
office contributed approximately $3,322,000 to total revenue.

Revenue is generated from the rental of equipment and related technical and
support services. Showpower provides services on a project-by-project basis.
Customers typically pay on a fixed-fee basis for each project or rental
transaction. Most transactions involve partial payment on or before delivery of
equipment to a customer's project site. Revenue is recognized over the term of
and commensurate with the scope of services provided. Services related to
large-scale or longer-term projects typically involve advance deposits and
progress payments. Customer deposits and cash received before services are
performed are deferred and recorded as current liabilities. Large-scale or
longer-term projects also typically require contractual documentation. Customer
contracts generally cover service dates, specify equipment and personnel
requirements, delineate the services to be provided and contain payment
schedules. Certain costs, including airfare and shipping, are usually borne by
the customer.

Project lead times vary. Much of the Company's business is related to
scheduled television broadcasts, concerts, special events, corporate events and
motion pictures and, therefore, the Company receives advance notice of projects
ranging from one week to several months. Large projects often require research
and analysis, including site inspections, development of technical
specifications and performance standards, coordination with other service
vendors, production of electrical drawings and assembly of equipment, which may
be configured specifically to meet project needs. Frequently, however, the
Company is asked to deploy equipment systems or provide additional equipment and
services to existing projects on shorter notice. The Company also provides

17
<PAGE>
equipment in response to weather-related emergencies and plant breakdowns, but
these applications constitute only a small portion of the Company's business.

Cost of sales consists primarily of rental expense, labor, shipping costs
and depreciation expense related to power generation and temperature control
equipment. Power generation and temperature control equipment rental expense is
a significant component of cost of sales. The Company expects to decrease
equipment rental and shipping expenses by reducing the proportion of rented
equipment used in its business and by locating more equipment at branch offices
within areas where demand for Showpower's services exist.

Selling, general and administrative expenses consists primarily of
salaries, wages and benefits, insurance, occupancy costs, advertising, equipment
repairs and maintenance, supplies, communications, vehicles, depreciation and
amortization expense and bad debts. Management expects that selling, general and
administrative expenses will increase in the future as a result of geographic
expansion and the greater infrastructure needs of a public company. Such
increases may adversely affect future operating results on a quarterly and
annual basis.

Depreciation and amortization includes charges for rental equipment and
other equipment, as well as amortization of intangibles related to the
acquisition of Templine. The Company depreciates property and equipment over
estimated useful lives of five to ten years. Intangibles are amortized over a
period of fifteen years.

The Company experiences quarterly, seasonal and annual variations in
revenue and net income (which can be material) as a result of several factors,
including the timing and scale of concert tours, broadcast events and special
events, delays in or cancellations of customers' tours and events, the presence
or absence of triennial, quadrennial and large-scale special events, as well as
changes in the Company's revenue mix and related profitability among its various
rental services offered. Accordingly, operating results in any quarter should
not be considered indicative of results for the year or any future periods. Most
of the events serviced by the Company are held outdoors in the northern
hemisphere and typically occur during the second and third quarters of the year.

More than 85% of Showpower's revenue in 1997 was denominated in U.S.
dollars. The balance of the Company's revenue was primarily denominated in
British pounds sterling. Foreign currency denominated revenue in 1996 was not
significant. The Company anticipates that foreign currency denominated revenue
will become a more significant part of the Company's total revenue as it opens
additional branch offices outside of the United States.

Fluctuations in currency exchange rates result in fluctuations in reported
results of operations and financial position of the Company for business
conducted in currencies other than the U.S. dollar. For transactions denominated
in currencies other than the U.S. dollar, the Company's results of operations
are converted at average rates of exchange during the reporting period and
balance sheet amounts are translated at exchange rates at the balance sheet
date. The results from such conversion and changing exchange rates are recorded
as a separate component of stockholders' equity, which increased stockholders'
equity by $16,762 at December 31, 1997 and $7,287 at March 31, 1998.

18
<PAGE>
RESULTS OF OPERATIONS

The following table sets forth components of the Company's statement of
operations as a percentage of revenue.

<TABLE>
<CAPTION>
YEARS ENDED THREE MONTHS
DECEMBER 31, ENDED MARCH 31,
-------------- ----------------
1996 1997 1997 1998
---- ---- ---- ----
<S> <C> <C> <C> <C>
Revenue............................................................ 100% 100% 100% 100%
Cost of sales...................................................... 66 57 58 57
---- ---- ---- ----
Gross profit....................................................... 34 43 42 43
Selling, general and administrative................................ 31 36 43 38
Stock compensation................................................. -- -- -- 1
---- ---- ---- ----
Operating income (loss)............................................ 3 7 (1) 4
Interest and other (net)........................................... (2) (1) (2) (3)
---- ---- ---- ----
Income (loss) before income taxes.................................. 1 6 (3) 1
Income tax (provision) benefit..................................... -- (1) 1 1
---- ---- ---- ----
Net income (loss).................................................. 1% 5% (2)% 2%
---- ---- ---- ----
---- ---- ---- ----
</TABLE>

THREE MONTHS ENDED MARCH 31, 1998 COMPARED TO THREE MONTHS ENDED MARCH 31,
1997

Revenue. Revenue increased to $4,273,058 for the first quarter of 1998 from
$2,460,675 for the same period in 1997, an increase of $1,812,383, or 74%, due
primarily to increases in special events, including the Winter Olympics in
Nagano, Japan, concert touring and a full quarter of Templine operations in
1998. The first quarter of 1998 included a special touring event which accounted
for approximately 25% of the increase and concert tours by the Rolling Stones
and U2. Templine operations accounted for $204,468 of the increase.

Cost of sales. Cost of sales increased to $2,452,455 for the first quarter
of 1998 from $1,419,342 for the same period in 1997, an increase of $1,033,113,
or 73%, as a result of increased sales. Cost of sales as a percentage of revenue
was 57% in the first quarter of 1998 and 58% in the first quarter of 1997.
Equipment rental expense increased to $760,647 (18% of revenue) for the first
quarter of 1998 from $310,170 (13% of revenue) for the first quarter of 1997.
The increase in rental expense of $450,477 accounted for 44% of the total
increase in cost of sales and reflected increased special event and concert
touring projects in the first quarter of 1998 over the corresponding period in
1997. Shipping and other costs declined as a percentage of revenue in the first
quarter of 1998, partially offsetting increased equipment rental expense.

Gross profit. Gross profit increased to $1,820,603 for the first quarter of
1998 from $1,041,333 for the same period in 1997, an increase of $779,270, or
75%. Gross profit as a percentage of revenue was 43% in the first quarter of
1998 and 42% in the first quarter of 1997 as a result of the above factors.
Templine accounted for approximately $56,167 of the increase in gross profit.

Selling, general and administrative expenses. Selling, general and
administrative expenses increased to $1,626,930 for the first quarter of 1998
from $1,061,049 for the same period in 1997, an increase of $565,881, or 53%.
The increase resulted primarily from an increase in employees required to
support the growth in operations after the first quarter of 1997, a full quarter
of Templine operations and the newly opened branches in Fort Lauderdale and Rio
de Janeiro in 1998. Templine accounted for $205,879 of the increase in selling,
general and administrative expense. Selling, general and administrative expenses
decreased to 38% of revenue for the first quarter of 1998 from 43% of revenue
for the corresponding period in 1997, principally as a result of increased
revenue.

Stock compensation expense. During 1997, the Company made restricted stock
awards of an aggregate of 128,767 shares of Common Stock to certain executive
officers of the Company. The shares of Common Stock are restricted and subject
to forfeiture upon termination of employment. Stock compensation expense
resulting from the restricted stock awards made in March 1997 was first
recognized in the second quarter of 1997, resulting in the increase of $35,579
in the first quarter of 1998.

19
<PAGE>
Operating income (loss). As a result of the foregoing, operating income
increased to $158,094 in the first quarter of 1998 from an operating loss of
$19,716 for the same period in 1997, an increase of $177,810. The first quarter
of 1998 increase consisted of an increase in operating income of $490,576,
partially offset by $149,966 related to a full quarter loss for Templine in 1998
and the absence in 1998 of $162,800 of income recognized during the first
quarter of 1997 and attributable to a joint venture terminated in 1997. The
Company acquired Templine on March 17, 1997. The Templine operating loss was
$212,566 for the first quarter of 1998 as compared to $62,600 for the portion of
the first quarter of 1997 that the Company owned Templine. As a result of
seasonal fluctuations in its business, Templine's operations have resulted in a
loss for the first quarter of 1996 and 1997, while full year results of
operations were profitable in 1996 and 1997.

Interest expense. Interest expense increased to $102,897 for the first
quarter of 1998 from $37,723 for the same period in 1997, an increase of
$65,174, due primarily to increased borrowings in 1998.

Pro forma income tax provision (benefit). Pro forma income tax provision
(benefit) reflects provisions for federal and state income taxes as if the
Company's U.S. operations had been subject to federal and state income taxation
as a C Corporation at a 40% combined state and federal tax rate during the
periods presented. Templine's operations are subject to United Kingdom
corporation tax. A tax benefit was recognized in the first quarter of 1998 and
1997 in anticipation of full fiscal year income.

Pro forma net loss. As a result of the foregoing, pro forma net loss
improved to $19,330 in the first quarter of 1998 from $41,708 for the same
period in 1997, an improvement of $22,378.

YEAR ENDED DECEMBER 31, 1997 COMPARED TO YEAR ENDED DECEMBER 31, 1996

Revenue. Revenue increased to $17,294,036 in 1997 from $11,567,589 in 1996,
an increase of $5,726,447, or 50%. Of this increase, $2,669,000, or 47%, was
attributable to increased revenues from concert touring, special events and
corporate events and $2,491,000, or 43%, and $566,000, or 10%, was attributable
to the acquisition of Templine in March 1997 and a full year of operations from
the Company's Texas branch office opened in September 1996, respectively. The
Company increased its 1997 television, special events and corporate events
revenue despite the absence of television, special events and corporate events
revenue associated with the Olympics and the Republican National Convention,
which accounted for $3,825,000, or 33%, of revenues in 1996. Concert touring
business increased principally because of the commencement of a tour by U2.

Cost of sales. Cost of sales increased to $9,790,219 in 1997 from
$7,608,709 in 1996, an increase of $2,181,510, or 29%, as a result of increased
sales. Cost of sales as a percentage of total revenue decreased to 57% in 1997
from 66% in 1996. The reduction in cost of sales as a percent of revenue in 1997
reflected reduced equipment rental costs as a percent of revenue (partially
attributable to the acquisition of Templine), generally improved cost estimating
procedures for special events and corporate events, and the absence of higher
rental, transportation and other costs related to the 1996 Olympic Games.

The Company incurred rental expense for equipment used to provide service
to its customers of $2,810,241 (16% of revenue) and $2,306,528 (20% of revenue)
in 1997 and 1996, respectively. Short-term power and temperature control
equipment rental expense, a component of cost of sales, declined in 1997 as a
percentage of total revenues, partly as a result of increased capital
expenditures to purchase equipment and partly as a result of the acquisition of
Templine. Other significant components of cost of sales included personnel and
travel costs of $3,405,000 in 1997 (20% of revenue), transportation costs of
$1,452,000 in 1997 (8% of revenue) and depreciation expense of $881,460 (5% of
revenue). Personnel, travel and transportation costs in 1997 approximated 1996
amounts as a percent of revenue, while depreciation expense related to power
generation and temperature control equipment decreased $46,978 in 1997 from
$928,438 (8% of revenue) in 1996. Depreciation increased approximately $231,400
due to capital expenditures during 1997 and 1996, as well as depreciation of
$138,670 related to the acquisition of Templine in 1997. In 1997, the Company
reevaluated the useful lives of certain assets previously depreciated over five
to seven years and recorded depreciation using five- to ten-year useful lives,
effective January 1, 1997. The effect of this change in estimated useful lives
resulted in a decrease in depreciation charges of $417,048 in 1997, which offset
increases in depreciation.

In 1996, the Company recorded an expense of $218,000 relating to the
dissolution of a joint venture that had been formed to provide power generation
and temperature control services at the 1996 Atlanta Olympic Games.

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Following a decision by the Olympic organizing committee not to use the joint
venture's services, the Company dissolved the joint venture, paid its former
partners a total of $218,000 and pursued Olympics-related business on an
individual basis.

Gross profit. Gross profit increased to $7,503,817 in 1997 from $3,958,880
in 1996, an increase of $3,544,937, or 90%. Gross profit as a percentage of
revenues increased to 43% in 1997 from 34% in 1996, due to the above factors.
Templine contributed approximately $1,115,000 to the Company's 1997 gross
profit, or 31% of the increase.

Selling, general and administrative expenses. Selling, general and
administrative expenses increased to $6,179,079 in 1997 from $3,552,297 in 1996,
an increase of $2,626,782, or 74%. Selling, general and administrative expenses
as a percentage of revenue increased to 36% in 1997 from 31% in 1996. Salaries
and other employee-related costs increased to $3,599,000 in 1997 from $1,757,000
in 1996, an increase of $1,842,000, or 105%. These increases resulted primarily
from the addition of new branch offices, the acquisition of Templine and the
addition of supervisory, sales and marketing and clerical personnel. Other
selling, general and administrative expense, including insurance, occupancy,
vehicles, supplies, equipment repairs and maintenance, telephone, depreciation
and amortization and other, increased to $2,580,000 in 1997 from $1,795,000 in
1996, an increase of $785,000, or 44%. Selling, general and administrative
expenses also included bad debt expense, which decreased by $226,000 to $168,000
in 1997 from $394,000 in 1996.

Stock compensation expense. In connection with restricted stock awards made
during 1997, the Company recognized compensation expense of $106,737 in 1997.
Additional compensation expense will be recognized over the three-year vesting
period for the restricted shares based on the value of the shares at the date of
grant. Accordingly, stock compensation expense of $142,317, $142,317 and $35,579
relating to this grant will be recognized in 1998, 1999 and 2000, respectively.

Operating income (loss). As a result of the foregoing, operating income
increased to $1,218,001 in 1997 from $406,583 in 1996, an increase of $811,418,
or 200%. Templine contributed $312,592, or 26%, of operating income in 1997. In
addition, $162,800 of operating income in 1997 was attributable to a joint
venture formed in 1994 to provide power generation services in Japan, which was
terminated in 1997. In December 1997, the Company purchased the equipment
formerly used by the joint venture and used the equipment to provide services
for other Showpower projects, including the 1998 Nagano Winter Olympic Games.

Interest expense. Interest expense decreased to $203,667 in 1997 from
$237,015 in 1996, a decrease of $33,348 or 14%. The decrease in interest expense
reflects lower average interest rates in 1997, offsetting an increase in total
debt outstanding.

Pro forma income tax provision (benefit). Pro forma provision for income
taxes reflects provisions for federal and state income taxes as if the Company's
U.S. operations had been subject to federal and state income taxation as a C
Corporation at an assumed 40% combined federal and state income tax rate during
the periods presented. Provision for income taxes (actual) of $116,562 consists
primarily of United Kingdom Corporation tax related to Templine. See 'Income
Taxes' below.

Pro forma net income (loss). As a result of the foregoing, pro forma net
income increased to $632,370 in 1997 from $103,021 in 1996, an increase of
$529,349, or 514%. Templine contributed $200,000 to net income in 1997.

LIQUIDITY AND CAPITAL RESOURCES

The Company has made substantial capital expenditures to purchase equipment
and, in addition, has made a number of acquisitions. The Company intends to
continue these types of expenditures in order to expand in existing markets,
enter new markets and reduce the amount of equipment that it rents. Cash
generated by operations has not been sufficient to satisfy all of the Company's
working capital, capital expenditure and acquisition needs. Consequently, the
Company has depended and continues to rely, on external financing sources.

The Company currently has two asset-based financing commitments totaling
$6,500,000. Borrowings under a commitment with Caterpillar Financial Services
Corporation ('CAT Financial') bear interest at 9.2% to 9.3% per annum with
monthly principal and interest payments which must be paid on or before various
dates in 2002

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<PAGE>
and 2005 and may be repaid prior to maturity without penalty. As of April 30,
1998, $3,433,000 was outstanding under such commitment and there was additional
availability of $67,000. The other financing commitment with Charter Financial,
Inc. ('Charter') bears interest at a rate determined by the lender at the
funding date, with monthly principal and interest payments payable over a
four-year term, with 20% of the principal amount due in 2002, the end of the
term. Prepayment prior to maturity may be made at an amount equal to the sum of
future principal and interest payments, discounted at an annual rate of 6%. At
April 30, 1998, the Company had outstanding borrowings under this commitment
aggregating $2,687,000 and there was additional availability of $313,000. The
borrowings are secured by power generation and temperature control equipment.

In March 1998, the Company obtained a $2,000,000 line of credit facility
and a $300,000 leasehold improvements facility (the 'Facilities') from a bank.
Under the line of credit facility, availability of funds in excess of $750,000
is subject to an accounts receivable borrowing base formula and interest is
payable monthly at the lender's prime rate (8.5% at April 10, 1998) plus .75%,
or, at the Company's option, the London Interbank Offered Rate (LIBOR), plus
2.75%. The line of credit term is through May 1, 1999. The leasehold
improvements facility bears interest at the lender's prime rate, plus .875%, and
interest only is payable through September 1998 and monthly payments of interest
and principal are payable for the remaining 24 months thereafter. The Facilities
include customary negative covenants such as restriction on the Company's
ability to incur debt, make acquisitions, pay dividends, make investments or
sell assets. Also, the Facilities include financial covenants regarding the
Company's tangible net worth, ratio of cash and accounts receivable to current
liabilities, ratio of liabilities to tangible net worth and cash flow to fixed
charges ratio. Templine also has a line of credit with a bank in the amount of
150,000 British pounds sterling, bearing interest based on the bank's reference
rate with a term through December 1, 1999. At April 30, 1998, borrowings under
the two bank lines of credit totaled approximately $1,000,000.

The Company intends to use approximately $3,900,000 of the proceeds of the
Offering to repay its indebtedness to CAT Financial and amounts outstanding
under the two bank lines of credit.

Capital expenditures (including assets acquired through capital lease and
note payable financing) were $2,903,239 and $1,698,528 in 1997 and 1996,
respectively. The purchase of additional power generation, distribution and
temperature control equipment accounted for virtually all of such expenditures.
From December 31, 1997 through March 31, 1998, the Company made capital
expenditures for the purchase of equipment in the amount of approximately
$2,555,000, which the Company financed with cash on hand and the borrowings
described above. The Company intends to use approximately $6,000,000 of the
proceeds of the Offering to acquire or construct power generation and
temperature control equipment. The Company has no other plans for material
capital expenditures. The Company intends to finance the opening of new branch
offices and possible future acquisitions with internally generated funds, future
issuances of Common Stock or preferred stock, and additional borrowings, if
available.

Cash provided by operating activities for the years ended December 31, 1997
and 1996 generated $2,362,614 and $968,504, respectively. The increase of
$1,394,110, or 144%, resulted primarily from increased net income. Cash used in
operating activities totaled $503,035 and $128,197 for the three months ended
March 31, 1998 and 1997, respectively, an increase of $374,838. The increase was
primarily the result of deferred costs related to the World Cup project
beginning in May 1998, as well as deferred Offering costs.

Cash used in investing activities for the years ended December 31, 1997 and
1996 totaled $4,018,343 and $1,800,829, respectively. The increase of $2,217,514
resulted primarily from the acquisition of Templine in 1997 for $2,105,361, and
an increase in cash required for capital expenditures of $280,472 over 1996.
Cash used in investing activities totaled $249,439 and $2,283,634 for the three
months ended March 31, 1998 and 1997, respectively. The decrease was due
primarily to the acquisition of Templine in 1997.

Cash provided by financing activities for the years ended December 31, 1997
and 1996 generated $1,955,137 and $847,160, respectively. In 1997, the Company
issued 754,000 shares of Common Stock for cash of $2,042,730 and notes due from
certain officers of $457,270. See 'Certain Transactions.' In 1996, the Company
issued 405,086 shares of Common Stock for $1,221,754. Cash provided by financing
activities totaled $543,779 and $2,567,552 for the three months ended March 31,
1998 and 1997, respectively. The sale of Common Stock in 1997 occurred in the
first quarter. Other first quarter cash flows from financing activities
consisted of issuance of long term debt and bank borrowing in both 1998 and
1997.

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<PAGE>
In 1997, the Company incurred total long-term indebtedness of $3,010,110 to
CAT Financial ($1,036,365) and Charter ($1,973,745). Of the total amount
borrowed, $1,326,524 was used to repay stockholder loans, $998,869 was paid
directly to vendors for purchase of power generation and temperature control
equipment and the remaining $684,717 was added to working capital. In 1997, the
Company repaid principal of $242,043 on long-term borrowings and $149,762 on
capital lease obligations. The Company also made distributions to its
stockholders of $500,000 and $120,000 in 1997 and 1996, respectively. For the
three months ended March 31, 1998, the Company repaid principal of $221,329 on
long term indebtedness.

The Company has formed a corporate joint venture, Showpower Brasil S.A.
('Showpower Brazil'), to conduct business in Brazil. The Company owns 70% of
Showpower Brazil, and its Brazilian partner, Transweg Ltda. ('Transweg'), owns
the remaining 30%. The Company has options to purchase and Transweg has options
to require the Company to purchase Transweg's interest in Showpower Brazil at
five times EBITDA of Showpower Brazil which may be exercised five and eight
years from formation or renewal of the joint venture. In addition, Transweg may
exercise its option at any time if Mr. Campion ceases to function as an
executive of the Company. The Company has agreed to contribute approximately
$350,000 to the joint venture to fund start-up costs. As of March 31, 1998, the
Company had incurred operating expenses of approximately $314,000 and
anticipates funding the balance of its commitment by the end of the second
quarter of 1998. The Company may incur additional capital expenditures in
connection with Showpower Brazil in 1998, although it has no obligation to do
so. Showpower Brazil opened a branch office in Rio de Janeiro in January 1998.

The Company believes that cash flows from operations, the net proceeds from
the Offering and available existing credit facilities are sufficient to meet
operating needs and capital spending requirements and reasonably foreseeable
expansion for at least the next 12 months.

INCOME TAXES

The Company has historically elected to be taxed as an S Corporation for
federal and state income tax purposes and the Company's existing stockholders
have paid the income taxes on the Company's taxable income directly. The Company
has made distributions to stockholders primarily to provide the funds to the
stockholders to pay such taxes. Templine, the Company's United Kingdom
subsidiary, has been and will continue to be subject to United Kingdom corporate
taxes.

As a result of the termination of the Company's S Corporation status, which
will occur simultaneously with the consummation of the Offering, the Company
will be required to record a net deferred income tax liability of approximately
$800,000, which relates primarily to the differences between financial and
income tax reporting basis. Such change will result in a net charge to earnings
of approximately $800,000 in the second quarter of 1998. See 'S Corporation
Conversion.'

YEAR 2000 COMPLIANCE

Computer software applications on which the Company relies for accounting,
management and operating information are recent releases of, or are readily
upgraded to, Year 2000 compliant, commercially available applications. While the
Company has no assurance all of its vendors and service providers are Year 2000
compliant, management believes the potential risk and any associated cost
resulting from the Year 2000 problem will not be material to the Company's
results of operations or financial condition.

EFFECTS OF INFLATION

Inflation has not had a material impact upon the operating results of the
Company and the Company does not expect it to have such an impact in the future.
To date, in those instances in which the Company has experienced cost increases,
it has been able to increase selling prices to offset such increases in cost.
There can be no assurance, however, that the Company's business will not be
affected by inflation or that it can continue to increase its selling prices to
offset increased costs and remain competitive.

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BUSINESS

GENERAL

Showpower provides temporary power generation and temperature control
rental equipment and support services on a worldwide basis for entertainment,
corporate and special events. The Company's customers include corporations,
event producers, television networks, motion picture studios, facility operators
and performers that need electric power and/or temperature control services to
support events at locations where these services are inadequate or unavailable.
In addition to rental equipment, the Company provides fully integrated,
value-added services, including planning, technical advice, customized
installation, on-site operation and support personnel. The Company's power
equipment consists of transportable, diesel-powered electricity generators
contained in acoustic enclosures, and related power distribution equipment.
Temperature control equipment consists of transportable, electrically-driven
HVAC units.

Initially, the Company provided power generation and distribution services
only to concert touring artists. In 1992, the Company began providing these
services for live television broadcasts and large-scale special events. In 1995,
the Company began providing power generation services to the corporate special
events industry and subsequently added temperature control services. In 1996,
the Company began marketing to the motion picture, trade show and convention
industries.

Showpower services three primary markets:

The Company has expanded geographically by making acquisitions and opening
new branch offices. In March 1997, the Company acquired Templine, a generator
and distribution rental company based in Bristol, England, in order to expand
its presence and scope of operations in Europe. Since September 1996, the
Company has opened branch offices in Richardson, Texas, Fort Lauderdale, Florida
and Rio de Janeiro, Brazil. During 1997, Templine and the Company's Texas branch
office contributed approximately $3,322,000 to total revenue.

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<PAGE>
BUSINESS STRATEGY

The Company's business strategy is to expand its rental service
capabilities and geographic scope, domestically and internationally, by: (i)
increasing the amount of power generation and temperature control equipment it
owns; (ii) enhancing existing customer relationships and attracting new
business; (iii) opening new branch offices; (iv) acquiring rental service
businesses; and (v) broadening the range of services it offers at existing
branch offices.

The Company will increase its available equipment by acquiring power
generation and temperature control equipment with a significant portion of the
net proceeds of the Offering. The Company expects to improve profit margins by
reducing the proportion of rented equipment used in its business. In 1997,
rental expense was $2,810,240, or 16% of revenue. Approximately 54% of the net
proceeds of the Offering is expected to be used to acquire equipment of the
types currently rented by the Company.

The Company intends to extend customer relationships by selling multiple
services to its existing customers, building relationships with affiliates of
existing customers and attracting new business. The Company's customer
relationships often begin with a single project or assignment, then evolve to a
point where a customer may use the Company on a regular basis and for more
extensive projects. For example, during 1997 Showpower provided services to
several units of The Walt Disney Company, including Buena Vista, ABC, Disney
Entertainment Projects (Asia Pacific) and ESPN.

The Company intends to expand, domestically and internationally, by opening
new branch offices and acquiring rental service businesses. Management believes
that the three acquisitions completed and the corresponding branch offices
opened since September 1996 (described below in this section) have allowed the
Company to acquire additional large customers and expand its relationships with
certain existing customers and have reduced equipment shipping expenses.
Management believes that the Company's utilization of its available equipment
can be enhanced by expanding its network of branch offices and managing its
assets on a worldwide basis, including seasonal rotation of equipment.
Typically, in selecting a new location for a branch office or acquisition, the
Company considers such factors as metropolitan population, climate and
seasonality, historical special events activity, quality and availability of
existing electrical and temperature control infrastructures, and the
availability of competitive rental services. Since the majority of the events
served by the Company are held outdoors, the Company has given priority in its
recent expansion to locations where temperatures are mild year-round.

On March 17, 1997, the Company acquired Templine, a provider of temporary
power and electrical distribution services to the entertainment industry,
primarily in the United Kingdom and continental Europe. The acquisition of
Templine enabled the Company to offer its rental services throughout Europe on a
more cost-effective basis (e.g., by reducing ocean shipping costs), and to carry
out sales and marketing activity on a more consistent basis with European
customers as well as U.S. customers doing business in Europe.

In September 1996, the Company opened a branch office in the Dallas
metropolitan area following an acquisition of the assets of an electrical
contracting and temporary power rental company. The Company has integrated the
acquired assets and operations and has introduced temperature control services
to service Texas and the surrounding region.

In January 1998, the Company opened a branch office in the Miami
metropolitan area following an acquisition of the assets of a temporary power
generation and electrical services company. The Company is in the process of
integrating the acquired assets and operations and expects to use the office to
service southern Florida.

The Company has formed a corporate joint venture, Showpower Brazil, to
conduct business in Brazil. The Company owns 70% of Showpower Brazil, and its
Brazilian partner, Transweg, owns the remaining 30%. The Company has agreed to
contribute approximately $350,000 to the joint venture to fund start-up costs.
The Company has options to purchase and Transweg has options to require the
Company to purchase Transweg's interest in Showpower Brazil at five times EBITDA
of Showpower Brazil which may be exercised five and eight years from formation
or renewal of the joint venture. In addition, Transweg may exercise its option
at any time if Mr. Campion ceases to function as an executive of the Company.
Showpower Brazil opened a branch office in Rio de Janeiro in January 1998.

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The Company has no current agreements or commitments and is not currently
engaged in active negotiations with respect to any acquisitions.

INDUSTRY OVERVIEW

The Company believes that the worldwide market for temporary power,
electrical distribution and temperature control rental services, for all
applications, including entertainment, commercial and industrial uses, is
increasing in size. The Company believes that the following trends will create
growing opportunities for its services in domestic and international markets:

Outsourcing. The Company believes that many businesses have recognized that
renting equipment and obtaining support services from an 'outsource' such as the
Company offers substantial cost savings and flexibility compared to ownership of
such equipment and the need to establish in-house support capabilities.

The increasing use of professionally produced events as part of corporate
business communications and marketing strategies, including product launches and
promotions, sales meetings and conferences. These types of corporate and special
events incorporate a combination of communications elements and
entertainment/theatrical components, including live performances, video walls,
theatrical lighting and sophisticated audio systems. The Company believes that a
growing awareness among corporations and event producers of the availability and
cost effectiveness of rental support services will facilitate future growth in
this market and increase demand for Showpower's services.

The growth of corporate sponsorship of athletic and musical events,
entertainment tours and attractions, festivals, charitable causes and the arts.
Sponsors' use of temporary structures for retail, product demonstration or
hospitality purposes creates demand for power, electrical distribution and
temperature control services, especially in the context of large special events,
such as the Olympics, the Superbowl and the World Cup.

The growth of the television industry worldwide, including live and
live-for-tape broadcasting of sports contests, award shows, music and other
special events. The emergence of cable networks has increased the amount of
broadcast capacity and programming. The Company believes that sports programming
and specialized live programming, such as award shows and musical specials, are
less costly to produce than regular programming. Broadcasters often choose to
obtain generator-supplied power for qualitative reasons (e.g., superior
stability of voltage and frequency, which enhances the performance of sensitive
production and editing equipment) or quantitative reasons (e.g., power
requirements exceed installed service) or to secure stand-by generators as
protection against the possibility of utility power problems.

Increased exports of live entertainment to locations around the world.
Although the average number of large-scale concert tours has remained relatively
stable, the itineraries of such tours have changed significantly and now
regularly include venues in Asia, South America, South Africa and Central and
Eastern Europe, where local power supplies are often unreliable. In addition,
exports of touring theatrical and entertainment-related events are rising.
Outside of North America and Western Europe, a limited number of modern
performance venues and a general lack of adequate electrical and HVAC
infrastructure creates demand for the Company's services.

SERVICES AND EQUIPMENT

The Company differentiates itself from other equipment rental companies by
providing fully integrated, value-added services, including planning, technical
advice, customized installation, on-site operation and support personnel,
maintenance and removal, in combination with rental equipment. Large-scale
projects or concert tours can take several months to plan, requiring research
and analysis, including site tours, development of technical specifications and
performance standards, coordination with other service vendors, production of
electrical drawings and assembly of equipment, which may be designed or
configured to meet projects needs.

The Company assembles equipment to meet the specific requirements of its
customers. Because equipment is transported regularly to locations around the
world and used in a wide variety of operating environments and climatic
conditions, emphasis is placed on durability, transportability, noise levels,
thermal efficiency and reliability. Many of the Company's rental power and
temperature control units and most of the Company's electrical distribution
equipment are assembled at its Rancho Dominguez, California headquarters and at

26
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Templine's Bristol, England facility using components or subassemblies (engines,
alternators, coils, cable and pumps) purchased from OEMs. Other generators,
temperature control units and distribution equipment used by the Company are
assembled by third-party suppliers, often to Showpower's specifications. Major
suppliers include Caterpillar, Multiquip, Inc., Engine & Equipment Co., Inc.,
General Electric Company, Siemens and York International Corporation.

Certain equipment is used principally to support 'local' rental operations,
which typically involve transportation and installation within 300 miles of a
Showpower branch office. Generally, local rental services involve smaller
equipment systems and rentals of one week or less. The majority of the Company's
rental assets are deployed in support of touring events or at specific
large-scale project locations around the United States and around the world. The
duration of such touring and large-scale events generally ranges from one week
to more than 18 months. The Company attempts to maximize the utilization of its
assets on a national and worldwide basis. To do so, Showpower regularly
transfers assets and personnel from one branch office to another to meet
increases or decreases in demand.

The Company's power equipment consists of transportable, diesel-powered,
electricity generator sets contained in acoustic enclosures, and related
electrical distribution equipment that is used to transform and distribute
electricity. Individual generators provided by Showpower range in power output
from six kilowatts (kW) to 1,750 kW. Generators can be connected in parallel to
increase total output; the Company has installed up to 28,000 kW of temporary
generating capacity at a single location. All of the Company's generators are
designed to operate at low noise levels (generally less than 60 db at 50 feet)
and to meet applicable U.S. and international standards for emission and
pollution control and are capable of providing power over a wide range of
voltages and frequencies.

Related electrical distribution equipment includes transformers, switchgear
and cabling needed to transform voltage supplied by Showpower generators to the
voltage requirements of its customers, to switch electricity between different
voltages and to deliver power to end-use locations. The Company maintains
distribution equipment inventories required for both U.S. and international
electrical systems and that comply with all applicable domestic and
international standards for electrical equipment and appliances.

Temperature control equipment consists of water chillers, air handlers, air
conditioners, heaters and combination air conditioning and heating units.
Individual temperature control units range in capacity from one ton to 300 tons
and can be connected in parallel to provide larger cooling capacities; the
Company has installed up to 3,000 tons of cooling capacity at a single location.
Individual electric heating units range in capacity from 15 kW to 250 kW and
also can be combined to produce greater total output. Temperature control units
are often powered by Showpower generators.

Management believes that the basic diesel engine, electricity generation
and temperature control technologies used by the Company are not likely to
become obsolete for the foreseeable future. However, changes in environmental
regulations require continuing improvements in emissions control and refrigerant
technologies. Management generally concentrates its technological efforts on
equipment design and assembly, while OEMs generally maintain responsibility for
ensuring that their products meet established and developing environmental
standards. See '--Governmental and Environmental Regulations.'

To supplement its owned equipment, the Company regularly rents power
generation and temperature control equipment from OEMs and their dealers and
distributors. The duration of such rentals range from a single day to more than
one year, generally with a month-to-month or shorter rental term. The related
rental agreements often contain options to purchase the rental equipment, with a
percentage of the monthly rent being applied toward the purchase price. Although
numerous sources of rental equipment exist, the Company has established close
working relationships with Caterpillar and the Caterpillar Dealers as primary
suppliers of rental equipment. The Company expects to maintain these
relationships in the future.

CUSTOMERS

The Company serves customers in three key markets of the entertainment and
related industries:

Corporate and Special Events. Customers in this category include
corporations, business communications firms, advertising and marketing
firms, event producers, lighting and set designers, event

27
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planners, public relations firms, state or federal governments, and
political, not-for-profit, spiritual and religious organizations. The
Company has provided services for many prominent event producers and
communications firms, including Robert Isabel, Harris Productions, Merv
Griffin Productions, Visual Services, Inc., Caribiner International, Don
Misher, and Momentum IMC. Showpower's systems also have been used by or in
events for Nike, Inc., Cirque de Soleil, Buena Vista Pictures, AT&T
Corporation, Microsoft Corporation, The Gap, Pope John Paul II, Republican
National Convention, Deutsche Telekom, Inc., General Motors Corporation,
Macy's, NASCAR, Georgio Armani, Paramount Pictures Corporation, Viacom, the
1997 Presidential Inauguration, Nissan, Bell South, Penske Motorsports, the
Hong Kong Handover Ceremonies, the National Football League and the United
States Tennis Association.

Concert Touring. The Company provides power and/or temperature control
services for the worldwide concert tours of such artists as The Rolling
Stones, U2, Elton John, Billy Joel, Yanni, The Three Tenors, Guns 'n Roses,
Luis Miguel, Michael Jackson, Janet Jackson, Madonna , Jimmy Buffet, Paul
McCartney, the Eagles, Fleetwood Mac, Tina Turner, Aerosmith, Spice Girls,
KISS, Bruce Springsteen, Pink Floyd, Oasis, Whitney Houston, Garth Brooks
and David Bowie, as well as touring and single-location festivals,
including Lollapalooza, Horde, Warped, Amnesty International World Tour,
Woodstock 1994, the Glastonbury (England) Festival, Rock in Rio, Free Jazz
(Brazil), and numerous outdoor classical and orchestral performances.

Television and Film. Showpower has provided power and/or temperature
control services for NBC, ABC, CBS, Fox, HBO, ESPN, TBS, Showtime, BBC, TV
Globo, NHK, UPN, The Golf Channel, MTV, Nickelodeon and VH1 in connection
with more than 500 live broadcast events, including power for all of NBC's
site broadcasts from the Atlanta Olympic Games and from the World Track and
Field Championships in Athens, all scheduled broadcasts for The Golf
Channel, and coverage of professional sports contests, political
conventions, criminal trials, presidential debates and the 1997
Presidential Inauguration. The Company has provided services for or in
connection with award shows (Grammy's, MTV Music Awards, European Music
Awards), and pay-per-view and HBO special broadcasts (Garth Brooks in
Central Park, professional boxing). The Company provided power to CBS
during the 1998 Winter Olympic Games in Nagano, Japan and has contracted to
provide power and temperature control services to the organizing committee
of World Cup '98 in France. The Company has recently begun providing
services to the feature film market, where power and/or temperature control
services are required on location, in studios and at special effects
facilities. Recent film projects have included Volcano, Dante's Peak,
Starship Troopers, Broken Arrow and Godzilla.

The Company provided services to more than 500 customers in 1997. In 1996,
two customers comprised 11% and 10% of the Company's revenue, respectively, and
another customer accounted for 11% of the Company's revenue during 1997. The 10
largest customers of the Company accounted for 56% and 47% of the Company's
revenue during the same periods.

MARKETING AND SALES

The Company's Chief Executive Officer directs Showpower's overall marketing
activities, identifies new end- markets and develops selected new business
prospects. The Company's salesforce currently consists of six full-time
employees with an average of six years experience. The salesforce concentrates
on cultivating and developing long-term relationships with customers and
communicating the Company's technical strengths and ability to solve customers'
power and temperature control needs. Certain sales personnel specialize in
selected markets (e.g., special events or broadcasting), or are responsible for
specified geographic areas. Managers of branch offices handle local sales as
part of their overall responsibility.

The Company's marketing efforts are intended to create increased awareness
of the Company's services within relevant customer groups. The Company uses
brochures, participates in bid processes, attends trade shows and advertises in
trade publications as elements of its marketing strategy.

28
<PAGE>
TRAINING

Management believes highly trained, experienced and motivated employees are
critical to the Company's success as a value-added service provider. The Company
has established a training curriculum, under which each operating employee
receives a minimum of 35 hours of classroom training per year, in addition to
on-the-job training under the supervision of crew chiefs. New employees
typically are assigned first to warehouse, maintenance or fabrication positions
before progressing to positions involving installation and operation of power or
temperature control equipment at project sites or in conjunction with concert
tours.

The Company organizes project teams to execute large projects and tours.
Project teams typically consist of a project manager and one or more
technicians. A project manager is responsible for planning, budgeting and
pricing, installation, operation and ongoing liaison with a customer's
production personnel. A Showpower employee generally must have at least two
years of service with the Company before promotion to the position of project
manager. The Company's current project managers have an average of seven years
experience with Showpower.

MAINTENANCE PROGRAM

The Company is responsible for repairing and maintaining its owned and
rented equipment. Showpower's preventive maintenance program establishes a
schedule of procedures customized to each equipment type and application.
Showpower establishes schedules that result in the performance of preventive
maintenance procedures at shorter intervals than are recommended by OEMs from
which the Company acquires components and equipment. Management and personnel
responsible for equipment operation meet regularly to review equipment
performance and maintenance procedures and to make modifications when needed.
Repairs and maintenance are performed at the Company's branch offices or at
project sites by Showpower employees or by authorized OEM dealers. Overhauls and
upgrades are performed at the Company's Rancho Dominguez, California and
Bristol, England facilities. Warranty repairs are generally the responsibility
of OEMs.

GOVERNMENT AND ENVIRONMENTAL REGULATION

The Company and its operations are subject to numerous federal, state and
local rules and regulations governing, among other things, worker safety, air
emissions, water discharge and the generation, handling, storage, transportation
and treatment and disposal of hazardous substances and wastes. Under laws and
regulations relating to air emissions, the Company is required to operate
equipment within strict standards, and is required in certain areas, such as
southern California, to obtain operating permits for individual generator sets.
The Company expects that it, and other operators of equipment utilizing diesel
engines, will, in the future, become subject to stricter air emissions
standards, including requirements that engine manufacturers produce
cleaner-running products. Based on current laws and regulations, the Company
believes that it is in compliance with such laws and regulations and that its
policies, practices and procedures are designed to prevent unreasonable risk of
environmental damage or violation of environmental laws and regulations and any
resulting financial liability to the Company. Further, the Company is not aware
of any federal, state or local laws or regulations that have been enacted or
adopted, the compliance with which would have a material adverse effect on the
Company's results of operations or that would require the Company to make any
material capital expenditures. No assurance can be given that future changes in
such laws or regulations or changes in the nature of the Company's operations or
the effects of activities of prior occupants or activities at neighboring
facilities will not have an adverse impact on the Company's operations.

INTELLECTUAL PROPERTY

The Company does not own any patents. The Company has registered trademarks
for the Showpower name and Showpower logo in the United States, Japan and Brazil
and has applied for registration in the European Union. The Company intends to
protect its distinctive name and logo throughout the areas of the world where it
maintains a presence and, accordingly, will expand trademark and service mark
registrations as foreign operations increase.

29
<PAGE>
COMPETITION

The Company believes that the temporary power and temperature control
rental services market is both highly competitive and fragmented. Showpower
faces significant competition in virtually all of its markets from general
equipment rental companies, specialized equipment rental companies, and OEMs and
their dealers or distributors. The Company also faces competition from utility
companies and from local and national electrical and HVAC contractors. Company
believes that Aggreko Ltd., a power, temperature control and air compressor
equipment rental company based in the U.K., provides services that are the most
comparable in type and scope to those of Showpower. Aggreko Ltd. is
substantially larger than the Company and has a total of over 70 depots in more
than 20 countries worldwide.

There are no significant barriers to entry into the power generation or
temperature control rental markets. Competition is based primarily on the
availability of equipment, price, reputation and service quality and
capabilities. Many of the Company's competitors are larger and have greater
financial and other resources than the Company.

Showpower believes that its principal competitive strengths are its: (i)
established reputation and the relationships that it has developed with
customers in the entertainment and related industries; (ii) ability to provide
planning, rental, technical and personnel support services on a fully integrated
basis; (iii) ability to seek out and manage a large number of projects
simultaneously; and (iv) ability to assemble and rapidly deploy complex
equipment systems throughout the world. The Company also believes that it has an
advantage over general equipment rental firms, and rental firms specializing in
serving industrial and commercial customers, where management believes that
service requirements and performance expectations are less stringent.

LEGAL PROCEEDINGS

The Company is involved from time to time in various routine legal
proceedings incidental to its business. The Company is not engaged in any legal
proceeding that is expected to have a material adverse effect on the results of
operations or financial position of the Company.

EMPLOYEES

As of December 31, 1997, the Company had approximately 135 full-time
employees. The Company also engages personnel, from time to time, on a part-time
or project-by-project basis. None of the Company's employees is covered by a
collective bargaining agreement. The Company believes that its relationship with
its employees is satisfactory.

PROPERTIES

The Company leases all of its facilities, including its executive offices
and main shop and warehouse facility in Rancho Dominguez, California,
supplementary warehouse space near its headquarters, and regional offices in
Richardson, Texas; Scotch Plains, New Jersey; Fort Lauderdale, Florida; Bristol,
England; Rio de Janeiro, Brazil and an administrative office in Irvington, New
York. The Company has agreed to lease a new headquarters and warehouse facility
in Rancho Dominguez, California. Current lease terms range from one to six
years. The Company believes all of its facilities are in good operating
condition.

30
<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>
John J. Campion 35 Chief Executive Officer and Director
Laurence Anderson 35 President
Stephen R. Bernstein 42 Executive Vice President--General Counsel and Secretary
Gary M. Rosner 37 Vice President--Operations
Michael W. Crabbe 41 Vice President--Chief Financial Officer
Jeffrey B. Stone 42 Chairman of the Board
Joseph A. Ades 36 Director
Robert E. Masterson 52 Director
David C. Bernstein 40 Director
Vincent A. Carrino 42 Director designee*
Eric C. Jackson 53 Director designee*
</TABLE>

- ------------------
* The Board of Directors has elected Messrs. Carrino and Jackson to, and they
have agreed to become members of, the Board of Directors effective upon
consummation of the Offering.

JOHN J. CAMPION has served as Chief Executive Officer of the Company since
its founding in 1991. He has served as a director of the Company from March 1991
to May 1996 and from December 1997 to the present.

LAURENCE ANDERSON has served as President since August 1996 and prior
thereto as a Vice President since 1991.

STEPHEN R. BERNSTEIN has served as Executive Vice President, General
Counsel and Secretary of the Company since May 1996. From July 1991 to May 1996,
he served as Executive Vice President and General Counsel of Rock-It-Cargo, USA,
Inc., a freight forwarding and logistics company. From June 1994 to May 1995, he
was an officer of Viscount Air Services, Inc., a passenger charter airline,
which filed a voluntary petition for reorganization under Chapter 11 of the
United States Bankruptcy Code in January 1996.

GARY M. ROSNER has served as Vice President/Operations of the Company since
May 1991.

MICHAEL W. CRABBE has served as Chief Financial Officer of the Company
since December 1997. From November 1996 to July 1997 Mr. Crabbe served as Vice
President Finance, Chief Financial Officer of Industrial Wire Products. From
January 1996 to October 1996, he served as Assistant Controller, Sony Television
Entertainment and from November 1988 to October 1996 served as Vice President,
Controller with E! Entertainment Television, Inc. Prior to October 1988, Mr.
Crabbe held the position of Senior Manager with Deloitte & Touche LLP. He is a
certified public accountant.

JEFFREY B. STONE became Chairman of the Board of the Company in May 1996.
He has been the President of Ironhorse Ventures, Inc., a private investment
firm, since November 1992. Mr. Stone served as Chairman of the Board of Darling
International Inc., a food byproducts co-processor, from January 1993 to March
1994 and as its interim Chief Executive Officer from January 1994 to March 1994.
Mr. Stone is also an advisory director of Stewart Information Services
Corporation, a title insurance and real estate information company.

JOSEPH A. ADES became a director of the Company in May 1996. Since 1991, he
has been a partner in ABI Management Partners, a private investment firm.

ROBERT E. MASTERSON has served as a director of the Company since May 1996,
and previously served in the same capacity from 1991 to 1995. He has been the
Chief Executive Officer of Service Data Corporation, a data processing service
company, since 1991, and previously served as President of American Express
Travel Management Services, President and Chief Executive Officer of American
Express Data Base Services, Inc., and President and Chief Executive of First
Data Resources, Inc.

31
<PAGE>
DAVID C. BERNSTEIN became a director of the Company in 1991, and served as
Chairman of the Board from 1991 to May 1996. He has served as Chief Executive
Officer of Rock-It-Cargo, USA, Inc., a freight forwarding and logistics company,
since 1985. From June 1994 to January 1996, he was the chief executive officer
of Viscount Air Services, Inc., a passenger charter airline, which filed a
voluntary petition for reorganization under Chapter 11 of the United States
Bankruptcy Code in January 1996.

VINCENT A. CARRINO is President of Brookhaven Capital Management, Inc., an
investment management company which he founded in 1986. Mr. Carrino is also a
director of Rentway, Inc., an operator of rent-to-own stores.

ERIC C. JACKSON is the Chairman and Chief Executive Officer of Great Basin
Companies, a group of truck dealerships which he founded in 1976. He is also a
director of Intrenet, Inc., a holding company for truckload motor carriers.

STEPHEN R. BERNSTEIN is the brother of David C. Bernstein. Jeffrey B. Stone
is the brother-in-law of Joseph A. Ades.

Effective upon the consummation of the Offering, the directors will be
divided into three classes with staggered three-year terms. The term of the
first class will expire at the 1999 annual meeting of stockholders and the terms
of the second and third classes will expire at the 2000 and 2001 annual
meetings, respectively. The terms of the Company's current and proposed
directors will expire as follows: Messrs. David C. Bernstein, Masterson and
Stone--1999; Messrs. Carrino and Jackson--2000; and Messrs. Ades and
Campion--2001.

COMMITTEES OF THE BOARD OF DIRECTORS

Audit Committee. The Board of Directors of the Company has established an
audit committee (the 'Audit Committee') effective upon consummation of the
Offering. The Audit Committee, which will consist of Messrs. Carrino and
Jackson, will make recommendations concerning the engagement of independent
public accountants, review with the independent public accountants the scope and
results of the audit engagement, approve professional services provided by the
independent public accountants, review the independence of the independent
public accountants, consider the range of audit and non-audit fees and review
the adequacy of the Company's internal accounting controls.

Compensation Committee. The Board of Directors' Compensation Committee
currently consists of Messrs. Ades and Masterson and will consist of Messrs.
Ades and Jackson effective upon consummation of the Offering. The Compensation
Committee is responsible for approving compensation for executive officers and
for administering the Company's 1998 Stock Option and Incentive Plan.

DIRECTOR COMPENSATION

Other than Mr. Stone, Chairman of the Board, directors historically have
not received any compensation for their services as directors. Mr. Stone's
arrangement with the Company is described below. Directors receive
reimbursements of expenses incurred in attending meetings. After the Offering,
non-employee directors are expected to receive compensation in the form of
annual grants of options to purchase 1,000 shares of Common Stock.

32
<PAGE>
EXECUTIVE COMPENSATION

The following table shows compensation paid for the year ended December 31,
1997 to (i) the Chief Executive Officer and (ii) the Company's three other most
highly compensated individuals who were serving as officers on December 31, 1997
and whose salary and bonus exceeded $100,000 for the year ended December 31,
1997 (collectively, the 'Named Executive Officers').

<TABLE>
<CAPTION>
LONG-TERM
COMPENSATION
-------------------
ANNUAL COMPENSATION RESTRICTED STOCK
--------------------------------------- AWARDS
OTHER ANNUAL ------------------- ALL OTHER
NAME AND POSITION SALARY BONUS COMPENSATION(1) $ SHARES COMPENSATION(2)
- -------------------------------- -------- -------- --------------- -------- ------- ---------------
<S> <C> <C> <C> <C> <C> <C>
John J. Campion,
Chief Executive Officer....... $240,000 $133,333 $28,135 $256,170 77,260 $ 9,868
Laurence Anderson,
President..................... 150,000 66,667 11,847 170,780 51,507 4,376
Stephen R. Bernstein,
Executive Vice President...... 148,990 -- 5,179 -- -- 4,928
Gary M. Rosner,
Vice President/Operations..... 79,039 27,500 9,101 -- -- 2,371
</TABLE>

- ------------------
(1) Represents club membership and/or automobile allowance.

(2) Represents matching contributions by the Company to the Company's 401(k) tax
deferred savings plan (the '401(k) Plan') for the benefit of the executive,
and life insurance.

EMPLOYMENT CONTRACTS

Each of Messrs. Campion, Anderson, Stephen R. Bernstein and Jeffrey B.
Stone has entered into an employment agreement with the Company.

The employment agreement with Mr. Campion provides for his employment as
Chief Executive Officer at an annual base salary of $240,000, plus a bonus to be
awarded annually of not less than 6.67% of the Company's earnings before income
taxes, plus depreciation, amortization and interest expense minus principal
payments, interest expense, capital lease payments and capital investments as
provided in the employment agreement. The agreement with Mr. Campion expires in
May 2001.

The employment agreement with Mr. Anderson provides for his employment as
President at an annual base salary of $150,000, plus a bonus to be awarded
annually of not less than 3.33% of the Company's earnings before income taxes,
plus depreciation, amortization and interest expense minus principal payments,
interest expense, capital lease payments and capital investments as provided in
the employment agreement. The agreement with Mr. Anderson expires in May 1999.

The employment agreement with Mr. Bernstein provides for his employment as
Executive Vice President at an annual base salary of $150,000, plus a bonus to
be awarded annually at the discretion of the Board. The agreement with Mr.
Bernstein expires in June 1999.

The employment agreement with Mr. Stone provides for his employment as
Chairman at an annual base salary of $12,000, plus a bonus to be awarded
annually at the discretion of the Board. The agreement with Mr. Stone expires in
May 2000.

These 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 also contain covenants
prohibiting the solicitation of employees and the solicitation of customers 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 three years after the
termination of employment with the Company, may not participate in any capacity
in any business activities with respect to the power, electrical distribution
and temperature control equipment rental or services businesses, and such other
businesses as the Company may conduct from time to time.

33
<PAGE>
The Company may terminate the employment of the executive officers upon
death or extended disability or for cause (as defined). If employment is
terminated by the Company without cause, the Company must pay the executive
officer's salary and health and insurance benefits until the scheduled
termination date of the employment agreement.

1998 STOCK OPTION AND INCENTIVE PLAN

Effective January 1, 1998, the Board of Directors and the stockholders of
the Company adopted the 1998 Stock Option and Incentive Plan (the '1998 Stock
Option Plan'). Under the 1998 Stock Option Plan, the Company may award stock
options and performance shares to employees and directors of the Company. The
aggregate number of shares of Common Stock that may be awarded under the 1998
Stock Option Plan is 565,500, subject to adjustment in certain events. No
individual participant may receive awards for more than 141,375 shares in any
calendar year.

The 1998 Stock Option Plan is administered by the Compensation Committee of
the Board of Directors. Subject to the terms of the 1998 Stock Option Plan, the
Compensation Committee will have the sole discretion and authority to select
persons to whom awards will be made, to designate the number of shares to be
covered by each award, to establish vesting schedules, to specify all other
terms of the awards (subject to certain restrictions) and to interpret the 1998
Stock Option Plan.

With respect to stock options that are intended to qualify as 'incentive
stock options' under Section 422 of the Code, the option price must be at least
100% (or, in the case of a holder of more than 10% of the total combined voting
power of the Company's stock, 110%) of the fair market value of a share of
Common Stock on the date of the grant of the stock option. The Compensation
Committee will establish the exercise price of options that do not qualify as
incentive stock options ('non-qualified stock options') at the time the options
are granted which may not be less than 85% of their market value. No incentive
stock option may be exercised more than 10 years (or, in the case of a holder of
more than 10% of the total combined voting power of the Company's stock, five
years) from the date of grant or such shorter period as the Compensation
Committee may determine from the date it is granted. Non-qualified stock options
may be exercised during such period as the Compensation Committee determines at
the time of grant, which period may not be more than 10 years from the date of
grant. The Compensation Committee may also make awards of performance shares, in
which case the grantee would be granted shares of Common Stock, subject to the
Company's satisfaction of such performance goals over such period of time as the
Compensation Committee specifies.

On May 19, 1998, the Compensation Committee granted non-qualified stock
options to employees under the 1998 Stock Option Plan for an aggregate of
479,563 shares of Common Stock, effective at the closing date of the Offering.
Each of such options has an exercise price equal to the initial public offering
price set forth on the cover page of this Prospectus and has a term of 10 years.
The options vest in three equal annual installments commencing on the date of
consummation of the Offering. Included in these grants were grants of options to
purchase 141,375 shares to Mr. Campion, 70,688 shares to Mr. Anderson, 25,000
shares to Stephen R. Bernstein and 25,000 shares to Mr. Rosner.

401(K) PLAN

Upon completion of one year of employment, 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 provides a matching contribution of up to 50% of the employee's
contribution, subject to a maximum of six percent of the employee's salary.
Participants are fully vested at all times in the amounts they contribute to the
401(k) Plan; however amounts contributed by the Company are subject to vesting
over a five-year period. The Company's contributions are tax deductible to the
Company. Benefits under the 401(k) Plan generally become payable upon
retirement, death or disability.

34
<PAGE>
CERTAIN TRANSACTIONS

The Company has historically engaged in transactions with entities
controlled by its stockholders and their affiliates. It is anticipated that,
subsequent to the Offering, the Company will continue to engage in certain of
these transactions if economically advantageous to the Company. Future related
party transactions will be subject to the review and approval of the Company's
Audit Committee, which will be composed exclusively of the Company's outside
directors, and such transactions will be on terms no less favorable to the
Company than those that could be obtained from unaffiliated third parties.

TRANSACTIONS WITH OFFICERS

In May 1996, the Company issued and sold 405,086 shares of Common Stock to
eight investors, including Stephen R. Bernstein, for an aggregate purchase price
of $1,370,000.

In March 1997, the Company issued and sold 754,000 shares of Common Stock
to existing stockholders, including three directors and four officers of the
Company, and seven additional investors for an aggregate purchase price of
$2,500,000. In connection with this transaction, the Company loaned Messrs.
Campion, Anderson and Stephen R. Bernstein an aggregate of $457,270 to purchase
shares of Common Stock. The loans are evidenced by promissory notes which mature
in 2002, bear interest at the rate of 6.25% per annum and are secured by a
pledge of other shares of Common Stock owned by the makers of the notes.
Interest and principal is payable at maturity of the notes. The principal
obligation outstanding at December 31, 1997 was as follows: Mr.
Campion--$229,763; Mr. Anderson--$113,338 and Stephen R. Bernstein--$114,169.

During the fourth quarter of 1997, the Company extended interest-free
advances to two executive officers in the aggregate account of $90,340 in
anticipation of salary and bonus payments. As of the date of this Prospectus,
all such advances have been repaid.

ROCK-IT CARGO, USA, INC. AND AIR APPARENT, INC.

During 1996 and 1997, the Company purchased freight forwarding services in
the amounts of $218,704 and $217,098, respectively, from Rock-It Cargo, USA,
Inc., which is an affiliate of David C. Bernstein, a director of the Company,
and Mr. Masterson, a director of the Company. During 1996 and 1997, the Company
purchased travel agency services, primarily in the form of airline tickets, in
the amounts of $109,619 and $117,607, respectively, from Air Apparent, Inc.,
which is an affiliate of David C. Bernstein and Mr. Masterson, and Andrew Dietz
and Donna Dietz, two stockholders of the Company. The Company believes that all
of the foregoing transactions were made on terms no less favorable to the
Company than could have been obtained from unaffiliated third parties. All
future transactions between the Company and any entities controlled by directors
and shareholders of the Company will also be on terms believed to be no less
favorable to the Company than could be obtained from unrelated third parties.

NOTES PAYABLE TO STOCKHOLDERS

At January 1, 1996, the Company had outstanding notes payable to
stockholders in the aggregate principal amount of $1,406,709 bearing interest at
rates of 10% and 15% with principal and interest payable monthly and due on
various dates through May 31, 2000. Certain of the notes were secured by
equipment. The stockholders elected, effective May 1996, to receive
interest-only payments on these notes. During 1996, interest and principal paid
to David C. Bernstein, Stephen R. Bernstein and Messrs. Masterson and Dietz were
$20,291, $3,324, $196,658 and $9,969, respectively. The notes were paid in full
in January 1997 with the proceeds of long-term debt as follows: Mr.
Masterson--$1,117,595; David C. Bernstein--$139,455; Stephen R.
Bernstein--$17,366 and Mr. Dietz--$52,108. In addition, in March and April 1996,
Mr. Masterson loaned the Company an aggregate of $620,000, which was repaid in
May 1996 with interest of $9,092.

MODULAR ENERGY SYSTEMS (IRELAND), LTD.

During 1996, the Company purchased from Modular Energy Systems (Ireland),
Ltd. intellectual property rights relating to mobile generating equipment and
control systems for $66,945. Modular Energy Systems (Ireland), Ltd. is
beneficially owned by Mr. Campion.

35
<PAGE>
PRINCIPAL STOCKHOLDERS

The following table sets forth, as of June 1, 1998, certain information
with respect to the beneficial ownership of the Common Stock by: (i) each person
(or group of affiliated persons) known by the Company to own beneficially more
than five percent of the outstanding Common Stock; (ii) each director of the
Company; (iii) the Named Executive Officers; and (iv) all directors and
executive officers as a group. Information is set forth on both a pre-Offering
and a post-Offering basis. Except as indicated in the footnotes to this table,
the persons named in the table, based on information provided by such persons,
have sole voting and investment power with respect to all shares of Common Stock
shown as beneficially owned by them.

<TABLE>
<CAPTION>
PERCENTAGE OF TOTAL SHARES(1)
SHARES OF ---------------------------------
COMMON STOCK
NAME OF BENEFICIAL OWNER BENEFICIALLY OWNED BEFORE OFFERING AFTER OFFERING
- ---------------------------------------------------- ------------------ --------------- --------------
<S> <C> <C> <C>
John J. Campion..................................... 251,309(1) 12.0% 7.6%
Laurence Anderson................................... 127,574(2) 6.2 3.9
Stephen R. Bernstein................................ 146,163(3) 6.9 4.4
Jeffrey B. Stone.................................... 354,828 17.4 10.9
Joseph A. Ades...................................... 208,952(4) 10.2 6.4
Robert E. Masterson................................. 244,329 12.0 7.5
David C. Bernstein.................................. 180,093(5) 8.8 5.6
Michael W. Crabbe................................... 8,333(6) * *
Gary M. Rosner...................................... 8,333(7) * *
Vincent A. Carrino**................................ 145,612(8) 7.1 4.5
Eric C. Jackson**................................... 75,493 3.7 2.3
Albert J. Ades...................................... 208,952(4) 10.2 6.4
All directors, director designees and executive
officers as a group (12 persons).................. 1,895,651(9) 88.7 56.8
</TABLE>

- ------------------
* Less than 1%

** Director designee

(1) Mr. Campion shares voting and investment power with respect to 126,925
shares with his spouse. Includes 77,260 shares granted by the Company as a
Restricted Stock Award, which are subject to certain forfeiture provisions
until March 18, 2000. Includes 47,125 shares issuable upon the exercise of
options which become exercisable within 60 days.

(2) Mr. Anderson shares voting and investment power with respect to 52,505
shares with his spouse. Includes 51,507 shares granted by the Company as a
Restricted Stock Award, which are subject to certain forfeiture provisions
until March 18, 2000. Includes 23,563 shares issuable upon the exercise of
options which become exercisable within 60 days.

(3) Includes 20,159 shares owned by a family trust of which Mr. Bernstein is a
trustee. Mr. Bernstein has sole voting power but shares investment power
with respect to such 20,159 shares. Includes 8,333 shares issuable upon the
exercise of options which become exercisable within 60 days.

(4) Includes 60,320 shares owned by a general partnership of which Mr. Ades is a
partner. Mr. Ades shares voting and investment power with his partners with
respect to such 60,320 shares.

(5) Mr. Bernstein shares voting and investment power with respect to these
shares with his spouse.

(6) Includes 8,333 shares issuable upon the exercise of options which become
exercisable within 60 days.

(7) Includes 8,333 shares issuable upon the exercise of options which become
exercisable within 60 days.

(8) Includes 90,480 shares owned by a limited partnership, the general partner
of which is a corporation controlled by Mr. Carrino.

(9) Includes 95,687 shares issuable upon the exercise of options which become
exercisable within 60 days.

36
<PAGE>
DESCRIPTION OF CAPITAL STOCK

The following description of the Company's capital stock does not purport
to be complete and is subject in all respects to applicable Delaware law and to
the provisions of the Company's Certificate of Incorporation and Bylaws, copies
of which have been filed as exhibits to the Registration Statement of which this
Prospectus is a part.

The authorized capital stock of the Company consists of 6,500,000 shares of
Common Stock, $.01 par value per share, and 1,000,000 shares of Preferred Stock,
$.01 par value per share. As of June 1, 1998, there were 2,041,842 shares of
Common Stock issued and outstanding and no shares of Preferred Stock
outstanding. Upon consummation of the Offering, and assuming no exercise of the
Underwriters' over-allotment option, there will be 3,241,842 shares of Common
Stock issued and outstanding and no shares of Preferred Stock issued and
outstanding. An additional 479,563 shares of Common Stock will be issuable upon
exercise of outstanding options granted under the 1998 Stock Option Plan and
120,000 shares of Common Stock will be issuable upon exercise of the
Representative Warrants.

COMMON STOCK

Each holder of Common Stock is entitled to one vote per share of record on
all matters to be voted upon by the stockholders. Holders will not have
cumulative voting rights in connection with the election of directors or any
other matter. Subject to the preferential rights of any Preferred Stock that may
at the time be outstanding, each share of Common Stock will have an equal and
ratable right to receive dividends when, if and as declared from time to time by
the Board of Directors out of funds legally available therefor. The Company has
been, and may in the future be, subject to certain agreements which restrict the
payment of dividends. The Company does not anticipate paying cash dividends in
the foreseeable future. See 'Dividend Policy.'

In the event of the liquidation, dissolution or winding up of the Company,
holders of Common Stock are entitled to share ratably in all assets remaining
after payments to creditors and after satisfaction of the liquidation
preference, if any, of any Preferred Stock that may at the time be outstanding.
Holders of Common Stock have no preemptive or redemption rights and are not
subject to further calls or assessments by the Company. All of the currently
outstanding shares of Common Stock are, and all of the shares of Common Stock to
be issued and sold in the Offering will be, immediately upon consummation of the
Offering, validly issued, fully paid and nonassessable.

PREFERRED STOCK

The Board of Directors has the authority to issue up to 1,000,000 shares of
Preferred Stock in one or more series, to fix the rights, preferences,
privileges and restrictions granted to or imposed upon any unissued shares of
Preferred Stock and to fix the number of shares constituting any series and the
designations of such series, without any further vote or action by the
stockholders. The Board of Directors, without stockholder approval, will be able
to issue Preferred Stock with voting and conversion rights which could adversely
affect the voting power of the holders of Common Stock. The Company has no
present plans to issue any Preferred Stock.

REPRESENTATIVE WARRANTS

The Company has agreed to sell to the Representative or its designees, for
nominal consideration, the Representative Warrants to purchase an aggregate of
120,000 shares of Common Stock. The shares of Common Stock subject to the
Representative Warrants will be in all respects identical to the shares of
Common Stock offered to the public hereby. The Representative Warrants will be
exercisable for a four-year period commencing one year after the date hereof at
a per share exercise price equal to 150% of the public offering price of the
Common Stock. The Representative Warrants will be restricted from sale,
transfer, assignment or hypothecation for a period of one year from the date
hereof, except to officers or partners of the Representative or those of the
Underwriters. The Representative Warrants will contain anti-dilution provisions
providing for appropriate adjustment of the exercise price and number of shares
that may be purchased upon the occurrence of certain events. The Representative
Warrants may be exercised by paying the exercise price in cash, through the
surrender of shares of Common Stock, through a reduction in the number of shares
covered thereby, or by using a combination of such methods.

37
<PAGE>
DELAWARE LAW AND LIMITATIONS ON CHANGES IN CONTROL

Section 203 of the DGCL prevents an 'interested stockholder' (defined in
Section 203, generally, as a person owning 15% or more of a corporation's
outstanding voting stock) from engaging in a 'business combination' (as defined
in Section 203) with a publicly-held Delaware corporation for three years
following the date such person became an interested stockholder unless: (i)
before such person became an interested stockholder, the board of directors of
the corporation approved the transaction in which the interested stockholder
became an interested stockholder or approved the business combination; (ii) upon
consummation of the transaction that resulted in the interested stockholder's
becoming an interested stockholder, the interested stockholder owns at least 85%
of the voting stock of the corporation outstanding at the time the transaction
commenced (excluding stock held by directors who are also officers of the
corporation and by employee stock plans that do not provide employees with the
right to determine confidentially whether shares held subject to the plan will
be tendered in a tender or exchange offer); or (iii) following the transaction
in which such person became an interested stockholder, the business combination
is approved by the board of directors of the corporation and authorized at a
meeting of stockholders by the affirmative vote of the holders of 66-2/3 of the
outstanding voting stock of the corporation not owned by the interested
stockholder.

The Company's Certificate of Incorporation provides that at any time when
the Board of Directors consists of six or more members, a majority of the Board
of Directors may divide the Board into three classes, with each class serving
'staggered' terms of office of three years.

The Company's Bylaws generally require advance notice of any action to be
proposed at any meeting of stockholders and set forth other specific procedures,
including advance notice, for the nomination of a person to the Board of
Directors when such person is nominated other than at the direction of the
Board.

The provisions of the DGCL, Certificate of Incorporation and Bylaws
described above, together with the ability to issue Preferred Stock without
further stockholder action could have the effect of delaying, deferring or
preventing a change in control of the Company or the removal of existing
management.

LIMITATION ON DIRECTORS' AND OFFICERS' LIABILITY

The Certificate of Incorporation provides that a director of the Company
will not be personally liable to the Company or its stockholders for monetary
damages for any breach of fiduciary duty as a director, except in certain cases
where liability is mandated by the DGCL. The provision has no effect on any
non-monetary remedies that may be available to the Company or its stockholders,
nor does it relieve the Company or its directors from compliance with federal or
state securities laws. The Certificate of Incorporation of the Company generally
provides that the Company shall indemnify, to the fullest extent permitted by
law, any person who was or is a party or is threatened to be made a party to any
threatened, pending or completed action, suit, investigation, administrative
hearing or any other proceeding (each, a 'Proceeding') by reason of the fact
that he is or was a director or officer of the Company, or is or was serving at
the request of the Company as a director, officer, employee or agent of another
entity, against expenses (including attorneys' fees) and losses, claims,
liabilities, judgments, fines and amounts paid in settlement actually incurred
by him in connection with such Proceeding.

CERTAIN EFFECTS OF AUTHORIZED BUT UNISSUED STOCK

Upon consummation of the Offering, there will be 2,572,658 shares of Common
Stock available for future issuance without stockholder approval (assuming no
exercise of the Underwriters' over-allotment option). These additional shares
may be utilized for a variety of corporate purposes, including future public
offerings to raise additional capital or to facilitate corporate acquisitions.
The Company does not currently have plans to issue additional shares of capital
stock, other than shares of Common Stock which may be issued upon the exercise
of outstanding options or warrants. See 'Shares Eligible for Future Sale.'

38
<PAGE>
TRANSFER AGENT AND REGISTRAR

The transfer agent and registrar for the Common Stock is Continental Stock
Transfer & Trust Company, New York, NY.

SHARES ELIGIBLE FOR FUTURE SALE

Upon completion of the Offering, 3,241,842 shares of Common Stock will be
outstanding (3,421,842 shares if the over-allotment option is exercised in
full). Of these shares, the 1,200,000 shares of Common Stock sold in the
Offering (1,380,000 shares if the over-allotment option is exercised in full)
will be freely tradeable under the Securities Act, except that any shares of
Common Stock purchased by affiliates of the Company ('Affiliates'), as that term
is defined in Rule 144 under the Securities Act ('Rule 144'), may generally be
sold only in compliance with the limitations of Rule 144 described below. The
remaining 2,041,842 shares of Common Stock (the 'Restricted Shares') held by
existing stockholders were sold by the Company in reliance on exemptions from
the registration requirements of the Securities Act and may be restricted
securities within the meaning of Rule 144.

In general, under Rule 144 as currently in effect, beginning after the
effective date of the Registration Statement of which this Prospectus is a part,
a stockholder, including an Affiliate, who has beneficially owned his or her
Restricted Shares for at least one year from the date those Restricted Shares
were acquired from the Company or an Affiliate, is entitled to sell, within any
three-month period, a number of such shares that does not exceed certain volume
restrictions, provided that certain requirements concerning availability of
public information, manner of sale and notice of sale are satisfied. In
addition, under Rule 144(k), if a period of at least two years has elapsed from
the date any Restricted Shares were acquired from the Company or an Affiliate, a
stockholder that is not an Affiliate at the time of sale and has not been an
Affiliate for at least three months prior to the sale is entitled to sell those
shares without compliance with the above-referenced requirements of Rule 144. An
Affiliate must comply with the volume restrictions and the other requirements
referred to above whenever that Affiliate sells any securities of the Company.

Following consummation of the Offering, the Company intends to register on
Form S-8 under the Securities Act 565,500 shares of Common Stock reserved for
issuance under the 1998 Stock Option Plan. Shares registered on Form S-8 will be
available for resale in the open market subject to the limitations applicable to
Affiliates as provided in Rule 144.

The Company and certain of its existing stockholders have agreed that they
will not, directly or indirectly, without the prior written consent of the
Representative for a period of one year after the date of this Prospectus sell,
contract to sell pledge, grant any option for the sale of, or otherwise transfer
or dispose of, or cause the transfer or disposition of, any shares of Common
Stock or any securities convertible into or exchangeable or exercisable for any
shares of Common Stock or exercise any registration rights with respect to any
shares of Common Stock or any securities convertible into or exchangeable or
exercisable for any shares of Common Stock. The foregoing restrictions do not
apply to grants or awards by the Company under the 1998 Stock Option Plan. The
Representative may, in its sole discretion and at any time without notice,
release all or a portion of the shares subject to such restrictions therefrom,
although it has no present intention of doing so. See 'Underwriting.'

Prior to the Offering, there has been no public market for the Common
Stock, and no prediction can be made as to the effect, if any, that future sales
of shares of Common Stock, including Restricted Shares, or the availability of
shares of Common Stock, including Restricted Shares, for future sale, will have
on the market price of the Common Stock prevailing from time to time. Sales of a
substantial number of Restricted Shares in the public market following the
Offering, or the perception that such sales could occur, could adversely affect
prevailing market prices for the Common Stock and could impair the Company's
ability to raise capital through an offering of its equity securities.

39
<PAGE>
UNDERWRITING

Subject to the terms and conditions set forth in the Underwriting
Agreement, the form of which has been filed as an exhibit to the Registration
Statement of which this Prospectus forms a part (the 'Underwriting Agreement'),
the Underwriters named below, acting through Prime Charter Ltd., as
Representative, have severally agreed to purchase from the Company, and the
Company has agreed to sell to the Underwriters, an aggregate of 1,200,000 shares
of Common Stock. The Underwriting Agreement provides that the Underwriters'
obligations to pay for and accept delivery of those shares of Common Stock are
subject to certain conditions precedent, and that the Underwriters are committed
to purchase all of those shares of Common Stock if any shares are purchased.
Under certain circumstances, the commitments of non-defaulting Underwriters may
be increased as set forth in the Underwriting Agreement.

<TABLE>
<CAPTION>
NUMBER OF
UNDERWRITER SHARES
- ----------- ---------
<S> <C>
Prime Charter Ltd................................................................ 840,000
BT Alex. Brown Incorporated...................................................... 32,000
Cowen & Company.................................................................. 32,000
Schroder US Holdings Incorporated................................................ 32,000
Advest, Inc...................................................................... 24,000
Fahnestock & Co., Inc............................................................ 24,000
J.J.B. Hilliard, W.L. Lyons, Inc................................................. 24,000
John G. Kinnard & Company, Incorporated.......................................... 24,000
Ladenburg Thalmann & Co., Inc.................................................... 24,000
L.H. Friend, Weinress, Frankson & Presson, Inc................................... 24,000
Roney Capital Markets............................................................ 24,000
Sands Brothers & Co., Inc........................................................ 24,000
C.E. Unterberg, Towbin........................................................... 24,000
Burnham Securities, Inc.......................................................... 16,000
Gilford Securities Incorporated.................................................. 16,000
Van Kasper & Company............................................................. 16,000
---------
Total....................................................................... 1,200,000
---------
---------
</TABLE>

The Underwriters propose to offer the shares of Common Stock offered hereby
to the public at the public offering price set forth on the cover page of this
Prospectus and to certain dealers, who are members of the National Association
of Securities Dealers, Inc. (the 'NASD'), at such price less a concession not in
excess of $.45 per share. The Underwriters may allow, and such dealers may
reallow, a concession not in excess of $.10 per share to other dealers who are
members of the NASD. After the commencement of the Offering, the public offering
price, the concession and the reallowance may be changed.

The Company has agreed to pay the Representative a non-accountable expense
allowance of 3% of the aggregate offering price of the shares of Common Stock
offered hereby (including any shares of Common Stock purchased pursuant to the
over-allotment option), of which $100,000 has been paid by the Company to cover
some of the due diligence expenses and underwriting costs related to the
Offering. The Company has also agreed to pay the fees and expenses of counsel to
the Underwriters up to a maximum of $145,000.

The Company has agreed to indemnify the Underwriters against certain
liabilities in connection with the Offering, including liabilities under the
Securities Act.

The Company has agreed to sell to the Representative or its designees, for
nominal consideration, the Representative Warrants to purchase an aggregate of
120,000 shares of Common Stock. The shares of Common Stock subject to the
Representative Warrants will be in all respects identical to the shares of
Common Stock offered to the public hereby. The Representative Warrants will be
exercisable for a four-year period commencing one year after the date hereof at
a per share exercise price equal to 150% of the public offering price of the
Common Stock. The Representative Warrants will be restricted from sale,
transfer, assignment or hypothecation for a period of one year from the date
hereof, except to officers or partners of the Representative or those of the
Underwriters. During the period beginning one year from the consummation of the
Offering and ending five

40
<PAGE>
years after the date hereof, the holder of the Representative Warrants may
require the Company to register for resale to the public the shares of Common
Stock issued or issuable upon exercise of the Representative Warrants. Such
demand registration right may be exercised once during such period. In addition,
during the period ending seven years from the date hereof, the Company has
agreed to include such shares of Common Stock in any appropriate registration
statement which is filed by the Company. The Representative Warrants will
contain anti-dilution provisions providing for appropriate adjustment of the
exercise price and number of shares that may be purchased upon the occurrence of
certain events. The Representative Warrants may be exercised by paying the
exercise price in cash, through the surrender of shares of Common Stock, through
a reduction in the number of shares covered thereby, or by using a combination
of such methods.

The Company has granted to the Underwriters an option, exercisable during
the 30-day period after the date of this Prospectus to purchase up to 180,000
additional shares of Common Stock at the public offering price, less the
underwriting discounts and commissions and a pro-rata portion of the
non-accountable expense allowance. The Underwriters may exercise this option
solely to cover over-allotments, if any, made in the sale of the shares of
Common Stock offered hereby. To the extent that this option is exercised, each
Underwriter will become obligated, subject to certain conditions, to purchase
approximately the same percentage of such additional shares of Common Stock as
the percentage of shares of Common Stock it was originally obligated to purchase
pursuant to the Underwriting Agreement.

The Common Stock has been approved for listing on The American Stock
Exchange under the symbol 'SHO'.

Prior to this Offering, there has been no public market for the Common
Stock. Accordingly, the public offering price for the Common Stock was
determined by negotiation among the Company and the Representative. Among the
factors considered in determining the public offering price were the services,
the experience of management, the economic conditions of the Company's industry
in general, the general condition of the equity securities market and the demand
for similar securities of companies considered comparable to the Company and
other relevant factors. There can be no assurance, however, that the prices at
which the Common Stock will sell in the public market after this Offering will
not be lower than the price at which the shares of Common Stock are sold by the
Underwriters.

Until the distribution of Common Stock in this Offering is completed, rules
of the Securities and Exchange Commission (the 'Commission') may limit the
ability of the Underwriters and certain selling group members to bid for and
purchase the Common Stock. As an exception to these rules, the Representative is
permitted to engage in certain transactions that stabilize the price of the
Common Stock. Such transactions consist of bids or purchases for the purpose of
pegging, fixing or maintaining the price of the Common Stock. If the
Underwriters create a short position in the Common Stock in connection with this
Offering, i.e., if they sell more shares of Common Stock than are set forth on
the cover page of this Prospectus, the Representative may reduce the short
position by purchasing Common Stock in the open market. The Representative may
also elect to reduce any short position by exercising all or part of the
over-allotment option described above. The Representative may also impose a
penalty bid on certain Underwriters and selling group members. This means that
if the Representative purchases shares of Common Stock in the open market to
reduce the Underwriters' short position or to stabilize the price of the Common
Stock, it may reclaim the amount of the selling concession from the Underwriters
and selling group members who sold those shares as part of this Offering. In
general, purchases of a security for the purpose of stabilization or to reduce a
short position could cause the price of the security to be higher than it might
be in the absence of such purchases. The imposition of a penalty bid might also
have an effect on the price of a security to the extent that it discouraged
resales of any security. Neither the Company nor any of the Underwriters makes
any representation or predictions as to the direction or magnitude of any effect
that the transactions described above may have on the price of the Common Stock.
In addition, neither the Company nor any of the Underwriters makes any
representation that the Representative will engage in such transactions or that
such transactions, once commenced, will not be discontinued without notice.

The Company and its existing stockholders who beneficially own 5% or more
of the outstanding shares of Common Stock, have agreed that they will not,
directly or indirectly, without the prior written consent of the Representative,
for a period of twelve months after the date of this Prospectus sell, offer to
sell, solicit an offer to buy, contract to sell, pledge, grant any option for
the sale of, or otherwise transfer or dispose of or cause the

41
<PAGE>
transfer or disposition of, any shares of Common Stock or any securities
convertible into or exchangeable or exercisable for any shares of Common Stock
or exercise any registration rights with respect to any shares of Common Stock
or any securities convertible into or exchangeable or exercisable for any shares
of Common Stock. The foregoing restrictions do not apply to grants or awards
under the Company's Stock Option Plan. See 'Shares Eligible for Future Sale.'

LEGAL MATTERS

The legality of the Common Stock offered hereby will be passed upon for the
Company by Baker & Daniels, Indianapolis, Indiana. Certain legal matters will be
passed upon for the Underwriters by Proskauer Rose LLP, New York, New York.

EXPERTS

The historical financial statements of the Company as of December 31, 1997
and for each of the two years ended December 31, 1997, included in this
Prospectus and Registration Statement have been audited by Deloitte & Touche
LLP, independent auditors, as stated in their report appearing herein (which
report expresses an unqualified opinion and includes an explanatory paragraph
referring to a change in the Company's estimated useful lives of and method of
accounting for depreciation of property and equipment) and have been so included
in reliance upon the report of such firm given upon their authority as experts
in accounting and auditing.

ADDITIONAL INFORMATION

The Company has filed with the Securities and Exchange Commission (the
'Commission') a Registration Statement on Form SB-2 under the Securities Act
with respect to the Common Stock offered hereby (the 'Registration Statement').
This Prospectus, which constitutes a part of the Registration Statement, does
not contain all of the information set forth in the Registration Statement and
the exhibits and schedules thereto. For further information with respect to the
Company and the shares of Common Stock offered hereby, reference is hereby made
to the Registration Statement, including the exhibits, financial statements and
schedules thereto. Statements contained in this Prospectus regarding the
contents of any contract or other document are not necessarily complete; with
respect to each such contract or document filed as an exhibit to the
Registration Statement, reference is made to the exhibit for a more complete
description of the matter involved, and each such statement shall be deemed
qualified in its entirety by such reference.

As a result of this Offering, the Company will be subject to the
informational requirements of the Securities Exchange Act of 1934, as amended
(the 'Exchange Act'), and, in accordance therewith, will file reports and other
information with the Commission. A copy of the Registration Statement, including
the exhibits, financial statements and schedules thereto, may be inspected
without charge at the principal office of the Commission at Judiciary Plaza, 450
Fifth Street, N.W., Room 1024, Washington, D.C. 20549 and at its regional
offices located at Seven World Trade Center, New York, New York 10048 and
Citicorp Center, 500 West Madison Street, Chicago, Illinois 60661, and copies of
such materials may be obtained from the Public Reference Section of the
Commission at Judiciary Plaza, 450 Fifth Street, N.W., Room 1024, Washington,
D.C. 20549 upon payment of the fees prescribed by the Commission. The Commission
also maintains a Web site that contains reports, proxy and information
statements and other materials that are filed through the Commission's
Electronic Data Gathering, Analysis, and Retrieval (EDGAR) system. This Web site
can be accessed at http://www.sec.gov.

42
<PAGE>
INDEX TO FINANCIAL STATEMENTS

<TABLE>
<CAPTION>
PAGE
----

<S> <C>
Independent Auditors' Report............................................................................... F-2
Consolidated Balance Sheets as of December 31, 1997 and (Unaudited) March 31, 1998......................... F-3
Consolidated Statements of Operations for the Years Ended December 31, 1996 and 1997 and (Unaudited) the
Three Months Ended March 31, 1997 and 1998............................................................... F-4
Consolidated Statements of Stockholders' Equity for the Years Ended December 31, 1996 and 1997 and
(Unaudited) the Three Months Ended March 31, 1998........................................................ F-5
Consolidated Statements of Cash Flows for the Years Ended December 31, 1996 and 1997 and (Unaudited) the
Three Months Ended March 31, 1997 and 1998............................................................... F-6
Notes to Consolidated Financial Statements................................................................. F-7
</TABLE>

F-1
<PAGE>
INDEPENDENT AUDITORS' REPORT

Showpower, Inc.

We have audited the accompanying consolidated balance sheet of Showpower, Inc.
and subsidiaries (the 'Company') as of December 31, 1997 and the related
consolidated statements of operations, stockholders' equity and cash flows for
the years ended December 31, 1997 and 1996. These financial statements are the
responsibility of the Company's management. Our responsibility is to express an
opinion on these financial statements based on our audits.

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

In our opinion, such consolidated financial statements present fairly in all
material respects, the financial position of the Company, as of December 31,
1997 and the results of its operations and its cash flows for the years ended
December 31, 1997 and 1996 in conformity with generally accepted accounting
principles.

As discussed in Note 4 to the financial statements, in 1997, in addition to
prospectively changing the assets' estimated useful lives, the Company changed
its method of accounting for depreciation of property and equipment from an
accelerated method to the straight-line method and, retroactively, restated the
1996 financial statements for the change.

DELOITTE & TOUCHE LLP

Los Angeles, California
March 6, 1998
(except for Note 17, as to which
the date is May 19, 1998)

F-2
<PAGE>
SHOWPOWER, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
<TABLE>
<CAPTION>
MARCH 31,
1998
DECEMBER 31, -----------
1997
------------ (UNAUDITED)
<S> <C> <C> <C>
ASSETS
CURRENT ASSETS:
Cash and cash equivalents............................................. $ 485,788 $ 277,093
Accounts receivable, net of allowance for doubtful accounts of
$114,980 at December 31, 1997 and $176,377 at March 31, 1998........ 1,388,480 1,345,796
Due from employees (Note 12).......................................... 57,191 38,173
Prepaid expenses and other current assets............................. 409,499 675,106
------------ -----------
Total current assets.............................................. 2,340,958 2,336,168
------------ -----------
PROPERTY AND EQUIPMENT (Notes 4, 5, 6 and 11):
Property and equipment................................................ 12,056,711 14,590,042
Accumulated depreciation and amortization............................. (4,026,299) (4,338,590)
------------ -----------
Property and equipment, net....................................... 8,030,412 10,251,452
------------ -----------
OTHER ASSETS:
Intangible assets, less accumulated amortization of $158,461 at
December 31, 1997 and $192,675 at March 31, 1998 (Note 3)........... 1,291,127 1,315,022
Deposits and other assets............................................. 62,161 383,960
------------ -----------
Total other assets................................................ 1,353,288 1,698,982
------------ -----------
TOTAL............................................................. $11,724,658 $14,286,602
------------ -----------
------------ -----------

MARCH 31, 1998
--------------------------
PRO FORMA
DECEMBER 31, ACTUAL SEE NOTE 16
1997 (UNAUDITED) (UNAUDITED)
------------
<S> <C> <C> <C>
LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES:
Accounts payable...................................................... $ 1,404,330 $ 1,296,755 $ 1,296,755
Due to stockholders................................................... 600,000
Due to affiliates (Note 12)........................................... 42,834 66,445 66,445
Accrued payroll and related expenses.................................. 378,716 194,964 194,964
Other accrued expenses................................................ 335,740 292,035 292,035
Customer deposits..................................................... 578,429 578,951 578,951
Current portion of long-term debt (Note 6)............................ 727,687 1,039,383 1,039,383
Current portion of capital lease obligations (Note 11)................ 134,891 104,028 104,028
Income taxes.......................................................... 226,286 29,635 29,635
Bank lines of credit (Note 6)......................................... 119,495 594,028 594,028
------------ ----------- -----------
Total current liabilities....................................... 3,948,408 4,196,224 4,796,224
------------ ----------- -----------
LONG-TERM LIABILITIES:
Long-term debt (Note 6)............................................... 2,196,938 4,402,033 4,402,033
Long-term portion of capital lease obligations (Note 11).............. 52,591 41,032 41,032
Deferred income taxes (Note 9)........................................ 220,349 239,729 964,729
------------ ----------- -----------
Total long-term liabilities..................................... 2,469,878 4,682,794 5,407,794
------------ ----------- -----------
Total liabilities............................................... 6,418,286 8,879,018 10,204,018
------------ ----------- -----------
COMMITMENTS AND CONTINGENCIES (Notes 11 and 15)
STOCKHOLDERS' EQUITY:
Preferred stock; $0.01 par value; authorized, 1,000,000 shares; none
outstanding.........................................................
Common stock; $0.01 par value; authorized, 6,500,000 shares;
outstanding, 2,041,842 shares....................................... 20,418 20,418 20,418
Additional paid-in capital............................................ 6,658,073 6,693,652 6,693,652
Notes receivable from stockholders (Note 7)........................... (478,944) (489,217) (489,217)
Cumulative foreign currency translation adjustment.................... 16,762 7,287 7,287
Accumulated deficit................................................... (909,937) (824,556) (2,149,556)
------------ ----------- -----------
Total stockholders' equity...................................... 5,306,372 5,407,584 4,082,584
------------ ----------- -----------
TOTAL........................................................... $11,724,658 $14,286,602 $14,286,602
------------ ----------- -----------
------------ ----------- -----------
</TABLE>

See accompanying notes to consolidated financial statements.

F-3
<PAGE>
SHOWPOWER, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS

<TABLE>
<CAPTION>
THREE MONTHS ENDED
YEARS ENDED DECEMBER 31, MARCH 31,
-------------------------- ------------------------
1996 1997 1997 1998
----------- ----------- ---------- ----------
(UNAUDITED)
<S> <C> <C> <C> <C>
SALES.................................................... $11,567,589 $17,294,036 $2,460,675 $4,273,058
COST OF SALES............................................ 7,608,709 9,790,219 1,419,342 2,452,455
----------- ----------- ---------- ----------
GROSS PROFIT............................................. 3,958,880 7,503,817 1,041,333 1,820,603
----------- ----------- ---------- ----------
OPERATING EXPENSES:
Selling, general and administrative.................... 3,552,297 6,179,079 1,061,049 1,626,930
Stock compensation expense............................. 106,737 35,579
----------- ----------- ---------- ----------
Total operating expenses............................. 3,552,297 6,285,816 1,061,049 1,662,509
----------- ----------- ---------- ----------
INCOME (LOSS) FROM OPERATIONS............................ 406,583 1,218,001 (19,716) 158,094
----------- ----------- ---------- ----------
OTHER INCOME AND (EXPENSE):
Interest expense....................................... (237,015) (203,667) (37,723) (102,897)
Interest and other income (expense).................... 3,883 32,832 335 (11,624)
----------- ----------- ---------- ----------
Total other expense.................................. (233,132) (170,835) (37,388) (114,521)
----------- ----------- ---------- ----------
INCOME (LOSS) BEFORE INCOME TAXES........................ 173,451 1,047,166 (57,104) 43,573
INCOME TAX PROVISION (BENEFIT) (Note 9) ................. 1,050 116,562 (17,852) (41,808)
----------- ----------- ---------- ----------
NET INCOME (LOSS)........................................ $ 172,401 $ 930,604 $ (39,252) $ 85,381
----------- ----------- ---------- ----------
----------- ----------- ---------- ----------
BASIC NET INCOME (LOSS) PER SHARE........................ $ 0.17 $ 0.54 $ (0.03) $ 0.04
DILUTED NET INCOME (LOSS) PER SHARE...................... $ 0.17 $ 0.52 $ (0.03) $ 0.04

PRO FORMA AMOUNTS (Unaudited) (Note 16):
Income (loss) before income taxes, as reported......... $ 173,451 $ 1,047,166 $ (57,104) $ 43,573
Pro forma income tax provision (benefit)............... 70,430 414,796 (15,396) 62,903
----------- ----------- ---------- ----------
Pro forma net income (loss)............................ $ 103,021 $ 632,370 $ (41,708) $ (19,330)
----------- ----------- ---------- ----------
----------- ----------- ---------- ----------
Pro forma basic net income (loss) per share............ $ 0.10 $ 0.37 $ (0.04) $ (0.01)
Pro forma diluted net income (loss) per share.......... $ 0.10 $ 0.35 $ (0.04) $ (0.01)
Supplemental pro forma basic net income (loss) per
share................................................ -- $ 0.35 -- $ (0.01)
Supplemental pro forma diluted net income (loss) per
share................................................ -- $ 0.34 -- $ (0.01)
</TABLE>

See accompanying notes to consolidated financial statements.

F-4
<PAGE>
SHOWPOWER, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY

<TABLE>
<CAPTION>
CUMULATIVE
NOTES FOREIGN
ADDITIONAL RECEIVABLE CURRENCY
COMMON PAID-IN FROM TRANSLATION ACCUMULATED
SHARES STOCK CAPITAL STOCKHOLDERS ADJUSTMENT DEFICIT TOTAL
--------- ------- ---------- ------------ ---------- ----------- ----------
<S> <C> <C> <C> <C> <C> <C> <C>
BALANCE, JANUARY 1, 1996, As
previously reported........... 753,989 $7,540 $2,842,460 $(2,311,662) $ 538,338
Change in method of
depreciation (Note 4)....... 918,720 918,720
--------- ------- ---------- ----------- ----------
BALANCE, JANUARY 1, 1996, As
restated...................... 753,989 7,540 2,842,460 (1,392,942) 1,457,058
Issuance of common stock (Note
7).......................... 405,086 4,051 1,217,703 1,221,754
Net income.................... 172,401 172,401
Distribution to
stockholders................ (120,000) (120,000)
--------- ------- ---------- ----------- ----------
BALANCE, DECEMBER 31, 1996...... 1,159,075 11,591 4,060,163 (1,340,541) 2,731,213
Issuance of common stock (Note
7).......................... 754,000 7,540 2,492,460 2,500,000
Stock granted to officers
(Note 7).................... 128,767 1,287 425,663 426,950
Unearned compensation expense
(Note 7).................... (320,213) (320,213)
Stockholders notes, including
accrued interest of $21,674
(Note 7).................... $ (478,944) (478,944)
Net income.................... 930,604 930,604
Distribution to
stockholders................ (500,000) (500,000)
Foreign currency translation
adjustment.................. $ 16,762 16,762
--------- ------- ---------- ------------ ---------- ----------- ----------
BALANCE, DECEMBER 31, 1997...... 2,041,842 20,418 6,658,073 (478,944) 16,762 (909,937) 5,306,372
Compensation expense
(unaudited)................. 35,579 35,579
Accrued interest
(unaudited)................. (10,273) (10,273)
Net income (unaudited)........ 85,381 85,381
Foreign currency translation
adjustment (unaudited)...... (9,475) (9,475)
--------- ------- ---------- ------------ ---------- ----------- ----------
BALANCE, MARCH 31, 1998
(UNAUDITED)................... 2,041,842 $20,418 $6,693,652 $ (489,217) $ 7,287 $ (824,556) $5,407,584
--------- ------- ---------- ------------ ---------- ----------- ----------
--------- ------- ---------- ------------ ---------- ----------- ----------
</TABLE>

See accompanying notes to consolidated financial statements.

F-5
<PAGE>
SHOWPOWER, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS

<TABLE>
<CAPTION>
THREE MONTHS
YEARS ENDED DECEMBER 31, ENDED MARCH 31,
-------------------------- ------------------------
1996 1997 1997 1998
----------- ----------- ----------- ---------
(UNAUDITED)
<S> <C> <C> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income (loss)......................................... $ 172,401 $ 930,604 $ (39,252) $ 85,381
Adjustments to reconcile net income (loss) to net cash
provided by (used in) operating activities:
Depreciation and amortization........................... 1,058,529 1,103,332 244,917 385,837
Stock compensation expense.............................. 106,737 35,579
Gain on settlement (Note 13)............................ (162,800) (162,800)
Loss on disposal........................................ 23,790
Deferred income taxes................................... 28,981 (58) 19,380
Changes in operating assets and liabilities:
Accounts receivable................................... (607,854) (276,492) 297,666 61,702
Prepaid expenses and other current assets............. (27,840) (350,212) (10,194) (265,607)
Other assets.......................................... 114,612 19,347 32,308 (321,799)
Accounts payable...................................... 230,280 487,260 (258,965) (107,575)
Due to affiliate...................................... 39,504 (53,024) (34,058) 23,611
Other accrued expenses................................ 310,232 (73,608) (204,877) (247,205)
Customer deposits..................................... (321,360) 482,945 25,936 522
Income taxes.......................................... 119,544 (18,820) (196,651)
----------- ----------- ----------- ---------
Net cash provided by (used in) operating
activities....................................... 968,504 2,362,614 (128,197) (503,035)
----------- ----------- ----------- ---------
CASH FLOWS FROM INVESTING ACTIVITIES:
Acquired businesses, net of cash acquired................. (170,000) (2,105,361) (2,105,361) (100,000)
Purchases of property and equipment....................... (1,623,898) (1,904,370) (177,768) (149,439)
Other..................................................... (6,931) (8,612) (505)
----------- ----------- ----------- ---------
Net cash used in investing activities.............. (1,800,829) (4,018,343) (2,283,634) (249,439)
----------- ----------- ----------- ---------
CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds from issuance of common stock.................... 1,221,754 2,042,730 1,942,730
Proceeds from issuance of long term debt.................. 684,717 674,726 332,997
Borrowings under bank lines of credit..................... 119,495 75,941 474,533
Principal payments on long-term debt...................... (18,899) (242,043) (92,092) (221,329)
Principal payments on stockholder loans................... (80,185)
Principal payments on capital lease obligations........... (155,510) (149,762) (33,753) (42,422)
Distributions to stockholders............................. (120,000) (500,000)
----------- ----------- ----------- ---------
Net cash provided by financing activities.......... 847,160 1,955,137 2,567,552 543,779
----------- ----------- ----------- ---------
NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS........ 14,835 299,408 155,721 (208,695)
CASH AND CASH EQUIVALENTS, BEGINNING OF PERIOD.............. 171,545 186,380 186,380 485,788
----------- ----------- ----------- ---------
CASH AND CASH EQUIVALENTS, END OF PERIOD.................... $ 186,380 $ 485,788 $ 342,101 $ 277,093
----------- ----------- ----------- ---------
----------- ----------- ----------- ---------

SUPPLEMENTARY DISCLOSURE OF CASH FLOW INFORMATION (Note 13)
</TABLE>

See accompanying notes to consolidated financial statements.

F-6
<PAGE>
SHOWPOWER, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
YEARS ENDED DECEMBER 31, 1996 AND 1997

NOTE 1--ORGANIZATION

Showpower, Inc. and subsidiaries (the 'Company') provides temporary power
generation and temperature control rental equipment and support services on a
worldwide basis for entertainment, corporate and special events. The Company's
customers include corporations, event producers, television networks, motion
picture studios, facility operators and performers that need electric power
and/or temperature control services to support events at locations where these
services are inadequate or unavailable. In addition to rental equipment, the
Company provides fully integrated, value-added services, including planning,
technical advice, customized installations, on-site operations and support
personnel. The Company's power equipment consists of transportable,
diesel-powered electricity generators contained in acoustic enclosures, and
related power distribution equipment. Temperature control equipment consists of
transportable, electrically driven ventilation, heating and air conditioning
units.

In March 1997, the Company acquired 100% ownership in Templine, Ltd.
('Templine'), a United Kingdom corporation. The financial statements of Templine
are consolidated with those of the Company, and all significant intercompany
balances and transactions have been eliminated.

NOTE 2--SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Interim Financial Information--Financial information as of March 31, 1998
and for the three months ended March 31, 1997 and 1998 is unaudited. In the
opinion of the Company's management, the Company's unaudited financial
statements have been prepared on the same basis as the audited financial
statements and include all adjustments (consisting of normal recurring charges)
necessary for a fair presentation of the financial position and results of
operations.

Cash and Cash Equivalents--The Company considers all highly liquid
investments purchased with a maturity of three months or less to be cash
equivalents.

Prepaid Expenses and Other Current Assets--Costs related to scheduled
future projects for which contracts are in place are deferred and charged to
expense in the period revenue is recognized.

Property and Equipment--Property and equipment are stated at cost.
Leasehold improvements are amortized over the related lease term.

After the effect of accounting changes (see Note 4), depreciation is
computed on a straight-line basis using the following estimated useful lives:

<TABLE>
<S> <C>
Rental equipment..................................................... 7-10 years
Vehicles............................................................. 5 years
Furniture and fixtures............................................... 7 years
Other equipment...................................................... 5-7 years
</TABLE>

A portion of the Company's interest expense was incurred to fund the
construction of certain assets. Interest capitalized during the years ended
December 31, 1996 and 1997 amounted to $27,775 and $30,972, respectively.

Revenue Recognition--Revenue is recognized over the term of and
commensurate with the scope of services provided. Customer deposits and cash
received before services are performed are deferred and recorded as current
liabilities.

Intangibles--Intangible assets, primarily goodwill, are stated at cost and
are amortized by the straight-line method over periods from 2 to 15 years.

Income Taxes--The Company accounts for income taxes in conformity with
Statement of Financial Accounting Standards ('SFAS') No. 109. The Company has
elected to be taxed under the provisions of Subchapter S of the Internal Revenue
Code and similar state tax provisions. Under those provisions, the Company is
not subject to federal corporate income taxes. The earnings of S corporations
are reported on the tax returns of the stockholders. For California State
Franchise Tax purposes, a 1.5% tax is assessed on the taxable

F-7
<PAGE>
SHOWPOWER, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--(CONTINUED)

YEARS ENDED DECEMBER 31, 1996 AND 1997

NOTE 2--SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES--(CONTINUED)
income of the Company. The Company's United Kingdom subsidiary is subject to
United Kingdom corporation tax.

Foreign Currency--Templine conducts its primary business in the United
Kingdom, and the British pound sterling is the functional currency. Results of
operations are converted at average rates of exchange during the year and
balance sheet amounts are translated at exchange rates at the balance sheet
date. The results from such conversion and changing exchange rates are recorded
as a separate component of stockholders' equity.

Earnings per Share--The Company has adopted the provisions of SFAS No. 128,
'Earnings Per Share' ('EPS'). Basic EPS is calculated based on weighted average
outstanding shares. Diluted EPS includes the dilutive effect of restricted
shares issued to officers.

Use of Estimates--The preparation of financial statements in conformity
with generally accepted accounting principles requires management to make
estimates and assumptions that affect certain amounts and disclosures. Actual
results could differ from those estimates.

Financial Instruments--The Company's financial instruments that are exposed
to concentrations of credit risk consist primarily of cash equivalents and
accounts receivable. The Company's cash equivalents are placed primarily with
institutions with high credit ratings.

The concentration of credit risk, with respect to accounts receivable, is
generally diversified, as the Company has a broad customer base nationwide and,
to a lesser extent, worldwide. Customers are primarily within the entertainment
industry. Although receivables are unsecured, the Company routinely assesses the
financial strength of its customers and provides allowances for potential credit
losses. In 1996, two customers comprised 33% and 17% of the outstanding accounts
receivable balance, and two other customers comprised 11% and 10% of total
sales. In 1997, one customer comprised 10% of accounts receivable, and another
customer comprised 11% of total sales. For the three months ended March 31,
1998, sales to three customers comprised 13%, 12%, and 10% of total sales,
respectively.

The carrying values of cash and cash equivalents, accounts receivable, and
accounts payable approximate fair value due to the short maturities of such
instruments. Short-term and long-term notes payable are carried at amounts
approximating fair value based on current rates that would be offered to the
Company for debt with similar terms.

Long-Lived Assets--The Company reviews long-lived assets and identifiable
intangibles whenever events or changes in circumstances indicate that the
carrying amount of an asset may not be recoverable. An impairment loss is
recognized when estimated undiscounted cash flows expected to result from the
use of the asset and its eventual disposition are less than its carrying amount.

New Accounting Pronouncements--In June 1997, the Financial Accounting
Standards Board ('FASB') issued SFAS No. 130, 'Reporting Comprehensive Income,'
which establishes standards for reporting and displaying comprehensive income
and its components in a full set of financial statements. SFAS No. 130 is
effective for fiscal years beginning after December 15, 1997, and requires
reclassification of comparative financial statements for earlier periods.
Management of the Company believes that the adoption of SFAS No. 130 will result
in a presentation of comprehensive income that differs from net income as
presented in the accompanying financial statements to the extent of foreign
currency translation adjustments, as shown in the accompanying consolidated
statements of stockholders' equity.

In June 1997, the FASB issued SFAS No. 131, 'Disclosures about Segments of
an Enterprise and Related Information,' which establishes standards for
reporting information about operating segments in annual and interim financial
statements. It also establishes standards for related disclosures about products
and services, geographic areas and major customers. SFAS No. 131 supersedes SFAS
No. 14, 'Financial Reporting for Segments of a Business Enterprise.' Generally,
financial information is required to be reported on the basis that it is used
internally for evaluating segment performance and deciding how to allocate
resources to segments.

F-8
<PAGE>
SHOWPOWER, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--(CONTINUED)

YEARS ENDED DECEMBER 31, 1996 AND 1997

NOTE 2--SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES--(CONTINUED)
SFAS No. 131 is effective for financial statements for periods beginning after
December 15, 1997. In the initial year of application, comparative information
for earlier periods is to be restated. Management believes application of SFAS
No. 131 will have no significant effect on the Company's segment reporting.

NOTE 3--ACQUISITIONS

In September 1996, the Company purchased substantially all of the assets of
Pannell Electric Co., Inc., ('Pannell') a Texas-based company, for $170,000.

The Company also entered into consulting and non-competition agreements
with the former stockholder and the president of Pannell. The consulting and
non-competition agreements provide for monthly payments of $7,500, commencing
October 1, 1996 for a total of 24 consecutive months.

In March 1997, the Company acquired 100% of the common stock of Templine,
at a cost of $2,119,247, including acquisition costs. Templine operates in the
same business as the Company. Goodwill related to the acquisition totaling
$1,192,779 is being amortized by a straight-line basis over 15 years.

The Company accounted for the purchases of Pannell and Templine using the
purchase method of accounting, and results of operations have been included
since the acquisition date.

The following unaudited supplemental information presents results of
operations on a pro forma basis as though the acquired companies had been
acquired at the beginning of each period presented:

<TABLE>
<CAPTION>
YEARS ENDED DECEMBER 31,
-------------------------- THREE MONTHS ENDED
1996 1997 MARCH 31, 1997
----------- ----------- ------------------
(UNAUDITED) (UNAUDITED)
<S> <C> <C> <C>
Sales............................................... $13,801,000 $17,495,000 $2,662,000
Income (loss) before income taxes................... $ 604,000 $ 971,000 $ (133,000)
Net income (loss)................................... $ 451,000 $ 876,000 $ (94,000)
Basic net income (loss) per share................... $ 0.46 $ 0.51 $ (0.08)
Diluted net income (loss) per share................. $ 0.46 $ 0.49 $ (0.08)
</TABLE>

NOTE 4--ACCOUNTING CHANGES

In 1997, the Company adopted the straight-line depreciation method while in
all prior years depreciation was recorded using an accelerated method, which was
also used for income tax purposes. The straight-line method was adopted to
better allocate the cost of property and equipment to periods over which it is
used to generate revenue. Financial statements for prior periods have been
restated to apply the new method retroactively in contemplation of the Company's
initial public offering.

Prior to 1997, the Company depreciated property and equipment over
estimated useful lives of five to seven years. In January 1997, the Company
prospectively changed its estimate of useful lives of property and equipment to
five to ten years.

F-9
<PAGE>
SHOWPOWER, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--(CONTINUED)

YEARS ENDED DECEMBER 31, 1996 AND 1997

NOTE 4--ACCOUNTING CHANGES--(CONTINUED)
The effect of these changes was an increase in net income and net income
per share, as follows:

<TABLE>
<CAPTION>
YEARS ENDED DECEMBER
31,
----------------------
1996 1997
-------- --------
<S> <C> <C>
Effect of change to straight-line depreciation on:
Net income................................................................. $199,390 $241,188
Basic net income per share................................................. $ 0.20 $ 0.14
Diluted net income per share............................................... $ 0.20 $ 0.13
Pro forma basic, diluted and supplemental net income per share............. $ 0.12 $ 0.08

Effect of change in estimated useful life on:
Net income................................................................. $417,048
Basic net income per share................................................. $ 0.24
Diluted net income per share............................................... $ 0.23
Pro forma basic net income per share....................................... $ 0.15
Pro forma diluted net income per share..................................... $ 0.14
Supplemental pro forma basic net income per share.......................... $ 0.14
Supplemental pro forma diluted net income per share........................ $ 0.13
</TABLE>

NOTE 5--PROPERTY AND EQUIPMENT

Property and equipment consist of the following:

<TABLE>
<CAPTION>
DECEMBER
31, MARCH 31,
1997 1998
----------- -----------
<S> <C> <C>
Rental equipment......................................................... $10,300,828 $12,516,980
Vehicles................................................................. 711,095 745,847
Furniture and fixtures................................................... 165,226 171,301
Other equipment.......................................................... 463,144 469,478
Leasehold improvements................................................... 67,464 67,464
Work in process.......................................................... 348,954 618,972
----------- -----------
12,056,711 14,590,042
Accumulated depreciation and amortization................................ (4,026,299) (4,338,590)
----------- -----------
$ 8,030,412 $10,251,452
----------- -----------
----------- -----------
</TABLE>

Property and equipment depreciation and amortization expense for the years
ended December 31, 1996 and 1997 was $1,027,652 and $991,537, respectively,
after giving effect to a change in depreciation (see Note 4). Depreciation and
amortization for the three months ended March 31, 1997 and 1998 was $225,984 and
$350,638, respectively.

F-10
<PAGE>
SHOWPOWER, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--(CONTINUED)

YEARS ENDED DECEMBER 31, 1996 AND 1997

NOTE 6--LONG-TERM DEBT

The following is a summary of long-term debt:

<TABLE>
<CAPTION>
DECEMBER 31, MARCH 31,
1997 1998
------------ ----------
<S> <C> <C>
Notes payable to Charter Financial, Inc., payable in monthly installments
of $54,704, due January 2001 to March 2002 bearing annual interest at
approximately 8.9% to 11.0%, secured by rental equipment................. $1,698,110 $2,107,209
Notes payable to Caterpillar Financial Services Corp. payable in monthly
installments of $55,270 due March 2002 through March 2005, bearing annual
interest at approximately 9.2% to 9.3%, secured by rental equipment...... 968,056 2,973,845
Notes payable, denominated in British pounds sterling, payable in monthly
installments including interest ranging from 5% to 24%, through November
2000, secured by vehicles and rental equipment........................... 147,918 164,418
Notes payable, payable in monthly installments including interest at 9.9%,
due June 1998, secured by rental equipment............................... 110,541 63,357
Note payable in monthly installments including interest at 9.5%, due
January 2001, unsecured.................................................. 132,587
------------ ----------
Total notes payable........................................................ 2,924,625 5,441,416
Less current portion....................................................... 727,687 1,039,383
------------ ----------
Total long-term portion.................................................... $2,196,938 $4,402,033
------------ ----------
------------ ----------
</TABLE>

Maturities of the long-term debt are as follows:

<TABLE>
<CAPTION>
YEAR ENDING DECEMBER 31, MARCH 31,
DECEMBER 31, 1997 1998
- ------------- ------------ ----------
<S> <C> <C>
1998....................................................................... $ 727,417 $ 943,789
1999....................................................................... 647,379 987,826
2000....................................................................... 682,983 1,055,731
2001....................................................................... 676,834 1,134,956
2002....................................................................... 190,012 574,769
Thereafter................................................................. 744,339
------------ ----------
Total...................................................................... $2,924,625 $5,441,410
------------ ----------
------------ ----------
</TABLE>

Unused equipment financing availability totaled $3,489,890 at December 31,
1997 and $892,114 as of March 31, 1998. Available financing under the
arrangement with Caterpillar Financial Services Corp. is $2,463,635 as of
December 31, 1997 and $380,463 as of March 31, 1998, bearing interest at 9% per
annum with monthly principal and interest payments over a 7-year term.
Obligations may be repaid prior to maturity without penalty. The available
financing under the arrangement with Charter Financial, Inc. is $1,026,255 as of
December 31, 1997 and $511,651 as of March 31, 1998, bearing interest at a rate
determined by the lender at the funding date, with monthly principal and
interest payments over a 4-year term, with 20% of the interest and principal
amount due at the end of the term. Prepayment prior to maturity may be made at
an amount equal to the sum of future principal and interest payments, discounted
at an annual rate of 6%.

F-11
<PAGE>
SHOWPOWER, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--(CONTINUED)

YEARS ENDED DECEMBER 31, 1996 AND 1997

NOTE 6--LONG-TERM DEBT--(CONTINUED)
improvements facility bears interest at the lender's prime rate plus .875%,
interest only is payable through September 1998, and monthly payments of
interest and principal are payable for the remaining 24 months thereafter.

The Facilities include customary negative covenants such as restrictions on
the Company's ability to incur debt, make acquisitions, pay dividends, make
investments or sell assets. Also, the Facilities include financial covenants
regarding the Company's tangible net worth, ratio of cash and accounts
receivable to current liabilities, ratio of liabilities to tangible net worth
and cash flow to fixed charges ratio.

The Company has a line of credit of 150,000 British pounds sterling
(approximately $249,000 at March 31, 1998). The U.K. line of credit bears
interest based on the bank's reference rate and with a term through December 1,
1999.

NOTE 7--COMMON STOCK

In May 1996, the Company issued 405,086 shares of common stock for
$1,221,754, net of $148,246 of expenses.

In March 1997, the Company issued 754,000 shares of common stock for
$2,500,000, including 137,911 shares issued to certain officers in exchange for
recourse promissory notes of $457,270. The notes, which bear interest at 6.25%
per annum, are due at maturity in September 2002. The notes are recorded as a
reduction in stockholders' equity.

In 1996, the Company adopted a stock option and incentive plan for senior
management and key employees. In March 1997, the Company granted officers
128,767 restricted shares, which vest at the end of three years. Compensation
expense based on the fair value of the shares ($3.32 per share) is being
recognized over the vesting period.

Effective January 1, 1998, the Board of Directors and the stockholders of
the Company adopted the 1998 Stock Option and Incentive Plan (the '1998 Stock
Option Plan'). Under the 1998 Stock Option Plan, the Company may award stock
options and performance shares to employees and directors of the Company. The
aggregate number of shares of common stock that may be awarded under the 1998
Stock Option Plan is 565,500, subject to adjustment in certain events. No
individual participant may receive awards for more than 141,375 shares in any
calendar year.

F-12
<PAGE>
SHOWPOWER, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--(CONTINUED)

YEARS ENDED DECEMBER 31, 1996 AND 1997

NOTE 8--EARNINGS PER SHARE

<TABLE>
<CAPTION>
YEARS ENDED DECEMBER 31,
--------------------------------------------------------------------------------------
1996 1997
----------------------------------------- -----------------------------------------
INCOME SHARES PER SHARE INCOME SHARES PER SHARE
(NUMERATOR) (DENOMINATOR) AMOUNT (NUMERATOR) (DENOMINATOR) AMOUNT
----------- ------------- --------- ----------- ------------- ---------
<S> <C> <C> <C> <C> <C> <C>
BASIC NET INCOME PER SHARE
Net income.................... $ 172,401 990,294 $ 0.17 $ 930,604 1,724,580 $0.54
----------- ------------- --------- ----------- ---------
----------- ------------- --------- ----------- ---------
DILUTED NET INCOME PER SHARE
Effect of restricted stock.... 76,563
-------------
Income attributed to common
stockholders and effect of
restricted stock........... $ 172,401 990,294 $ 0.17 $ 930,604 1,801,143 $0.52
----------- ------------- --------- ----------- ------------- ---------
----------- ------------- --------- ----------- ------------- ---------
</TABLE>

<TABLE>
<CAPTION>
THREE MONTHS ENDED MARCH 31,
--------------------------------------------------------------------------------------
1997 1998
----------------------------------------- -----------------------------------------
INCOME INCOME
(LOSS) SHARES PER SHARE (LOSS) SHARES PER SHARE
(NUMERATOR) (DENOMINATOR) AMOUNT (NUMERATOR) (DENOMINATOR) AMOUNT
----------- ------------- --------- ----------- ------------- ---------
<S> <C> <C> <C> <C> <C> <C>
BASIC NET INCOME (LOSS) PER
SHARE
Net (loss) income............. $ (39,252) 1,159,080 $ (0.03) $ 85,381 1,913,080 $0.04
----------- ------------- --------- ----------- ---------
----------- ------------- --------- ----------- ---------
DILUTED NET INCOME (LOSS) PER
SHARE
Effect of restricted stock.... 105,048
-------------
Income (loss) attributed to
common stockholders and
effect of restricted
stock...................... $ (39,252) 1,159,080 $ (0.03) $ 85,381 2,018,128 $0.04
----------- ------------- --------- ----------- ------------- ---------
----------- ------------- --------- ----------- ------------- ---------
</TABLE>

The dilutive effect of 128,767 shares of restricted stock (see Note 7) on
earnings per share is calculated using the treasury stock method. Assumed
proceeds equal to unearned compensation divided by the contemplated initial
public offering price per share is used to reduce the dilutive effect of
restricted stock by the resulting number of shares.

NOTE 9--INCOME TAXES

Significant components of the income tax provision (benefit) are as
follows:

<TABLE>
<CAPTION>
YEARS ENDED THREE MONTHS ENDED
DECEMBER 31, MARCH 31,
------------------ --------------------
1996 1997 1997 1998
------ -------- -------- --------
<S> <C> <C> <C> <C>
Current................................................... $1,050 $ 87,581 $(17,794) $(61,188)
Deferred.................................................. 28,981 (58) 19,380
------ -------- -------- --------
Total..................................................... $1,050 $116,562 $(17,852) $(41,808)
------ -------- -------- --------
------ -------- -------- --------
</TABLE>

Templine, the Company's United Kingdom subsidiary, is subject to United
Kingdom corporation tax. United Kingdom deferred tax liabilities relate only to
the financial reporting basis of property, plant and

F-13
<PAGE>
SHOWPOWER, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--(CONTINUED)

YEARS ENDED DECEMBER 31, 1996 AND 1997

NOTE 9--INCOME TAXES--(CONTINUED)
equipment in excess of tax basis. The income tax effect of the financial
reporting basis over tax basis results from the acquisition of Templine during
1997, as well as income tax depreciation in excess of depreciation for financial
reporting purposes, and totals $220,349 at December 31, 1997.

The basis of the Company's U.S. net assets for financial reporting purposes
is approximately $1,753,726 and $1,812,409 greater than the U.S. tax basis,
primarily resulting from the use of accelerated depreciation for tax purposes at
December 31,1997 and March 31, 1998, respectively. No financial statement effect
has been given to differences between financial reporting and tax basis of U.S.
assets and liabilities, as the Company has elected S corporation status.

NOTE 10--RETIREMENT PLAN

The Company has a 401(k) plan covering employees who have completed one
year of service and are age 21 or older. The Company contributes $.50 for each
$1.00 contributed by employees up to 6% of eligible compensation. The Company
incurred $24,981 and $53,157 in retirement plan expense for the years ended
December 31, 1996 and 1997, respectively.

NOTE 11--LEASES

Operating Lease Obligations--The Company leases office and warehouse
facilities in California, New York, New Jersey, Texas and Bristol, England,
under operating leases expiring through 2008. The Company also rents equipment
under month-to-month rental agreements. Short-term rental expense of generators
and other operating equipment was $2,306,528 and $2,810,241 for the years ended
December 31, 1996 and 1997, respectively and $310,170 and $760,647 for the three
months ended March 31, 1997 and 1998, respectively. Other rental expense was
$151,596 and $234,561 for the years ended December 31, 1996 and 1997,
respectively.

Capital Lease Obligations--The Company leases various equipment under
capital leases. Amortization is computed by the straight-line method and has
been included in depreciation and amortization expense.

The following is a summary of property held under capital leases at
December 31, 1997:

<TABLE>
<S> <C>
Rental equipment............................................... $424,773
Vehicles....................................................... 66,899
Equipment, furniture and fixtures.............................. 34,237
--------
Total property at cost......................................... 525,909
Accumulated amortization....................................... (157,822)
--------
Total.......................................................... $368,087
--------
--------
</TABLE>

F-14
<PAGE>
SHOWPOWER, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--(CONTINUED)

YEARS ENDED DECEMBER 31, 1996 AND 1997

NOTE 11--LEASES--(CONTINUED)
Future Minimum Lease Payments--The future minimum lease payments under
operating and capital leases are as follows:

<TABLE>
<CAPTION>
DECEMBER 31, 1997 MARCH 31, 1998
--------------------- ----------------------
YEAR ENDING OPERATING CAPITAL OPERATING CAPITAL
DECEMBER 31, LEASES LEASES LEASES LEASES
- ------------- --------- -------- ---------- --------
<S> <C> <C> <C> <C>
1998........................................................... $ 166,940 $152,364 $ 226,455 $100,185
1999........................................................... 84,381 46,235 357,381 46,235
2000........................................................... 15,770 5,125 291,770 5,125
2001........................................................... 15,770 1,129 312,470 1,129
2002........................................................... 15,770 312,470
Thereafter..................................................... 81,478 1,713,328
--------- -------- ---------- --------
Total minimum lease payments................................... $ 380,109 204,853 $3,213,874 152,674
--------- ----------
--------- ----------
Amount representing interest................................... (17,371) (7,614)
-------- --------
Present value of net minimum lease payments.................... 187,482 145,060
Current portion of capital lease obligations................... (134,891) (104,028)
-------- --------
Long-term portion.............................................. $ 52,591 $ 41,032
-------- --------
-------- --------
</TABLE>

NOTE 12--RELATED-PARTY TRANSACTIONS

Due from Employees--At December 31, 1997, the Company held a note
receivable from an employee, payable in 26 installments of $187, including
interest at 8.0% per annum, with the unpaid balance of $14,400 due July 16,
2001. The Company also had a loan receivable from an officer of $30,000, at
December 31, 1997, which was due upon demand and repaid in January 1998.

Due to Affiliates--The Company purchases freight forwarding services and
travel agency services (primarily airline tickets) from entities with common
ownership. The Company also purchases freight forwarding and maintenance
services from a company owned by an employee of Templine. The following is a
summary of transactions and balances with the affiliates:

<TABLE>
<CAPTION>
YEARS ENDED DECEMBER
31,
----------------------
1996 1997
-------- --------
<S> <C> <C>
Travel agency services....................................................... $109,619 $117,607
Freight services............................................................. $218,704 $217,098
Templine freight and maintenance services.................................... $ -- $ 50,000

Due to affiliates as of December 31, 1997.................................... $ 42,834
</TABLE>

Intellectual Property Rights--In 1996, the Company purchased intellectual
property rights for $66,945 from one of its officers and stockholders. The
intellectual property rights, which have an estimated useful life of three
years, include a data acquisition system, control system, engine interface
module and generator interface module. The related amortization expense totaled
$20,704 and $22,315 for the years ended December 31, 1996 and 1997,
respectively.

F-15
<PAGE>
SHOWPOWER, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--(CONTINUED)

YEARS ENDED DECEMBER 31, 1996 AND 1997

NOTE 13--SUPPLEMENTARY DISCLOSURE OF CASH FLOW INFORMATION

Cash paid for interest and income taxes is as follows:

<TABLE>
<CAPTION>
YEARS ENDED THREE MONTHS
DECEMBER 31, ENDED MARCH 31,
---------------------- ------------------------
1996 1997 1997 1998
-------- ---------- ---------- ----------
<S> <C> <C> <C> <C>
Interest expense................................. $264,790 $ 234,639 $ 40,328 $ 112,548
Income taxes..................................... $ 1,050 $ 53,373 $ -- $ 65,528
Summary of noncash investing and financing
activities:
Acquisition of intangibles by assuming
liabilities.................................... $ 60,000 $ -- $ -- $ --
Purchases of assets through capital lease and
note payable financing......................... $ 74,630 $ 998,869 $ -- $2,405,123
Repayment of stockholder notes through issuance
of long-term debt.............................. $ -- $1,326,524 $1,326,524 $ --
</TABLE>

Assets acquired and (liabilities assumed) in connection with the
acquisition of Templine in 1997 were as follows:

<TABLE>
<S> <C>
Cash and cash equivalents....................................................... $ 13,886
Accounts receivable............................................................. 213,330
Property and equipment.......................................................... 1,269,470
Goodwill........................................................................ 1,192,779
Accounts payable................................................................ (87,190)
Accrued expenses................................................................ (90,584)
Customer deposits............................................................... (47,644)
Notes payable................................................................... (97,214)
Income taxes payable............................................................ (56,218)
Deferred income taxes........................................................... (191,368)
----------
Total acquisition cost.......................................................... $2,119,247
----------
----------
</TABLE>

In 1994, the Company entered into a cooperation agreement with Mitsuho
Electric, Ltd., Japan ('Mitsuho'). Under the terms of the agreement, the
companies were to share equally the gross revenues less certain costs. As part
of the agreement, Mitsuho advanced to the Company a noninterest-bearing note
payable of $400,000. The Company terminated the agreement in 1997. The balance
of the note at December 31, 1996 of $213,000 was disputed by the Company and
settled for $50,200 in 1997, resulting in a gain of $162,800.

F-16
<PAGE>
SHOWPOWER, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--(CONTINUED)

YEARS ENDED DECEMBER 31, 1996 AND 1997

NOTE 14--SEGMENT INFORMATION

Information about the Company's operations in different geographic areas is
as follows:

<TABLE>
<CAPTION>
YEAR ENDED DECEMBER 31, 1997
--------------------------------------------------------
ADJUSTMENTS
UNITED UNITED AND
STATES KINGDOM ELIMINATIONS CONSOLIDATED
----------- ---------- ----------- ------------
<S> <C> <C> <C> <C>
Revenue...................................... $14,803,222 $2,905,276 $(414,462) $ 17,294,036
----------- ---------- ----------- ------------
----------- ---------- ----------- ------------
Operating profit............................. $ 905,409 $ 312,592 $ 1,218,001
----------- ----------
----------- ----------
Interest expense............................. (203,667)
Interest and other income.................... 32,832
------------
Income before income taxes................... $ 1,047,166
------------
------------
Identifiable assets.......................... $ 8,724,743 $3,283,914 $(283,999) $ 11,724,658
----------- ---------- ----------- ------------
----------- ---------- ----------- ------------
</TABLE>

<TABLE>
<CAPTION>
THREE MONTHS ENDED MARCH 31, 1998
--------------------------------------------------------
ADJUSTMENTS
UNITED UNITED AND
STATES KINGDOM ELIMINATIONS CONSOLIDATED
----------- ---------- ----------- ------------
<S> <C> <C> <C> <C>
Revenue...................................... $ 4,014,525 $ 349,973 $ (91,440) $ 4,273,058
----------- ---------- ----------- ------------
----------- ---------- ----------- ------------
Operating profit (loss)...................... $ 370,660 $ (212,566) $ 158,094
----------- ---------- ------------
----------- ---------- ------------
Interest expense............................. (102,897)
Interest and other expense................... (11,624)
------------
Income before income taxes................... $ 43,573
------------
------------
Identifiable assets.......................... $11,451,086 $3,129,969 $(294,453) $ 14,286,602
----------- ---------- ----------- ------------
----------- ---------- ----------- ------------
</TABLE>

NOTE 15--COMMITMENTS AND CONTINGENCIES

The Company is a party to potential claims arising in the ordinary course
of its business. In the opinion of management, the Company has adequate legal
defenses with respect to these matters so that the ultimate resolution will not
have a material adverse effect on the Company's financial position, results of
operations or cash flows.

NOTE 16--PRO FORMA AMOUNTS (UNAUDITED)

S Corporation Conversion--In connection with the Company's contemplated
initial public stock offering, the Company will terminate its S Corporation
status. As a result, the Company will pay income taxes at the corporate level.
The pro forma income tax provision in the consolidated statements of operations
is based upon an assumed 40% federal and state income tax rate for the Company's
U.S. operations.

Distributions--Subsequent to the termination of its S Corporation status,
the Company will determine the amount of undistributed 1998 S Corporation
earnings taxable to existing stockholders and a distribution will be made to its
stockholders of approximately $600,000 to pay income taxes on S Corporation
income.

Deferred Income Taxes--In connection with the conversion of the Company's S
Corporation status to C Corporation status, the Company is required by FASB No.
109 to record deferred income tax liabilities and deferred income tax assets.
Such change will result in a net charge to earnings in the fiscal quarter in
which the conversion to C Corporation status takes place. This one-time charge
is a result of differences in the accounting and tax treatment of certain of the
Company's assets and liabilities and is reflected through an increase in

F-17
<PAGE>
SHOWPOWER, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--(CONTINUED)

YEARS ENDED DECEMBER 31, 1996 AND 1997

NOTE 16--PRO FORMA AMOUNTS (UNAUDITED)--(CONTINUED)
deferred income taxes. Deferred tax liabilities of approximately $725,000 would
have been recorded had the conversion to a C Corporation taken place on March
31, 1998.

Adjustments to Equity--The pro forma adjustments to accumulated deficit are
as follows:

<TABLE>
<CAPTION>
ACCUMULATED
DEFICIT
-----------
<S> <C>
March 31, 1998--Actual.......................................... $ (824,556)
Distribution payable to stockholders............................ (600,000)
Deferred income taxes........................................... (725,000)
-----------
March 31, 1998--Pro Forma....................................... $(2,149,556)
-----------
-----------
</TABLE>

Supplemental Pro Forma Net Income Per Share--Supplemental pro forma net
income per share gives effect to the increase in number of shares, the net
proceeds of which would have been sufficient to pay the distributions to
stockholders from proceeds from the Company's contemplated initial public stock
offering.

NOTE 17--SUBSEQUENT EVENTS

Long-Term Debt--In April 1998, the Company issued long-term debt in the
aggregate amount of $512,169 to Caterpillar Financial Services Corp. and Charter
Financial, Inc. under the equipment financing arrangements described in Note 6.

1998 Stock Option Plan--In May 1998, the Company granted non-qualified
stock options to employees under the 1998 Stock Option Plan for an aggregate of
479,563 shares of common stock, effective at the date of the Company's
contemplated initial public stock offering. Each of such options has an exercise
price equal to the initial public offering price and has a term of 10 years. The
options vest in three equal annual installments beginning at the date of the
initial public offering.

Reincorporation and Stock Split--In March 1998, the Company reincorporated
in Delaware. In connection with the reincorporation, the Company is authorized
to issue 6,500,000 shares of common stock, par value $0.01 per share, and
1,000,000 shares of preferred stock, par value $0.01 per share. On April 6,
1998, the Company's Board of Directors declared a 754-for-one stock split of the
outstanding common stock and effected the split by paying a stock dividend. All
share and per share amounts have been restated to reflect the reincorporation
and the stock split.

F-18
<PAGE>

[INSIDE BACK COVER]

[Photographs of backstage passes for concert touring events]

Showpower provides temporary power generation and temperature
control rental equipment and support services on a worldwide basis
for entertainment, corporate and special events.

<PAGE>

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NO DEALER, SALESPERSON OR OTHER INDIVIDUAL HAS BEEN AUTHORIZED TO GIVE ANY
INFORMATION OR TO MAKE ANY REPRESENTATION OTHER THAN THOSE CONTAINED IN THIS
PROSPECTUS IN CONNECTION WITH THE OFFERING MADE HEREBY, AND, IF GIVEN OR MADE,
SUCH INFORMATION OR REPRESENTATION MUST NOT BE RELIED UPON AS HAVING BEEN
AUTHORIZED BY THE COMPANY OR ANY UNDERWRITER. 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 LAWFUL
TO MAKE SUCH AN OFFER OR SOLICITATION IN SUCH JURISDICTION. NEITHER THE DELIVERY
OF THIS PROSPECTUS NOR ANY SALE MADE HEREUNDER SHALL UNDER ANY CIRCUMSTANCES
CREATE ANY IMPLICATION THAT THERE HAS BEEN NO CHANGE IN THE AFFAIRS OF THE
COMPANY SINCE THE DATE HEREOF OR THAT THE INFORMATION CONTAINED HEREIN IS
CORRECT AS OF ANY TIME SUBSEQUENT TO THE DATES AS OF WHICH SUCH INFORMATION IS
FURNISHED.

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

TABLE OF CONTENTS

<TABLE>
<CAPTION>
PAGE
-----
<S> <C>
Prospectus Summary............................. 3
Risk Factors................................... 7
Use of Proceeds................................ 12
S Corporation Conversion....................... 12
Dividend Policy................................ 13
Dilution....................................... 13
Capitalization................................. 14
Selected Consolidated Financial Information.... 15
Management's Discussion and Analysis of
Financial Condition and Results of
Operations................................... 17
Business....................................... 24
Management..................................... 31
Certain Transactions........................... 35
Principal Stockholders......................... 36
Description of Capital Stock................... 37
Shares Eligible for Future Sale................ 39
Underwriting................................... 40
Legal Matters.................................. 42
Experts........................................ 42
Additional Information......................... 42
Index to Financial Statements.................. F-1
</TABLE>

UNTIL JULY 11, 1998 (25 DAYS AFTER THE DATE HEREOF), ALL DEALERS EFFECTING
TRANSACTIONS IN THE REGISTERED SECURITIES, 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 UNDERWRITER AND
WITH RESPECT TO THEIR UNSOLD ALLOTMENTS OR SUBSCRIPTIONS.

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<PAGE>

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1,200,000 SHARES

[LOGO OMITTED]

COMMON STOCK

-------------------
PROSPECTUS
-------------------

PRIME CHARTER LTD.

June 16, 1998

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