OBJECTSOFT CORP
POS AM, 1997-10-14
COMPUTER INTEGRATED SYSTEMS DESIGN
Previous: ITT HARTFORD LIFE & ANNUITY INSURANCE CO SEPARATE ACCOUNT ON, 485BPOS, 1997-10-14
Next: ENVIROTEST SYSTEMS CORP /DE/, 3, 1997-10-14




================================================================================
    AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON OCTOBER 14, 1997

                                                      Registration No. 333-10519
- --------------------------------------------------------------------------------

                       SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549
                              ---------------------
                        POST EFFECTIVE AMENDMENT NO. 1 TO
                                    FORM SB-2
                             REGISTRATION STATEMENT
                                      Under
                           THE SECURITIES ACT OF 1933
                              ---------------------

                             OBJECTSOFT CORPORATION
                 (Name of small business issuer in its charter)


            Delaware                   7373                      22-3091075
(State of other jurisdiction      (Primary Standard           (I.R.S. Employer
      of incorporation               Industrial              Identification No.)
      or organization)             Classification
                                    Code Number)
                              ---------------------

   Continental Plaza III, 433 Hackensack Avenue, Hackensack, New Jersey 07601
                                  (201)343-9100
                   (Address and telephone number of principal
                               executive offices)
                              ---------------------

   Continental Plaza III, 433 Hackensack Avenue, Hackensack, New Jersey 07601
               (Address of principal place of business or intended
                          principal place of business)
                              ---------------------

                           David E.Y. Sarna, Chairman
                             ObjectSoft Corporation
                  Continental Plaza III, 433 Hackensack Avenue,
                          Hackensack, New Jersey 07601
                        (201)343-9100 (Name, address and
                     telephone number of agent for service)
                              ---------------------
                                   Copies to:

                              Melvin Weinberg, Esq.
                       Parker Chapin Flattau & Klimpl, LLP
                            New York, New York 10036
                               Tel: (212) 704-6000
                               Fax: (212) 704-6288
                              ---------------------

           APPROXIMATE  DATE  OF  PROPOSED  SALE  TO  THE  PUBLIC:  As  soon  as
practicable after the effective date of this registration statement.

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

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

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

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


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

<PAGE>



                                EXPLANATORY NOTE

           This  Registration  Statement  covers the  registration  of (i) up to
1,366,050  shares  of  Common  Stock,  $.0001  par value  ("Common  Stock"),  of
ObjectSoft  Corporation,  a Delaware corporation (the "Company"),  and 1,366,050
redeemable Class A Warrants  ("Class A Warrants"),  for sale by the Company in a
public  offering  and (ii) an  additional  1,086,963  shares of Common Stock and
412,500   Class  A   Warrants   (collectively,   the   "Selling   Securityholder
Securities"),  all for resale by the holders  thereof or of certain  outstanding
warrants  (the  "Selling  Securityholders")  from time to time,  subject  to the
contractual restrictions that certain Selling Securityholders may not sell their
Selling  Securityholder  Securities during a period of 12 months ending November
12, 1997 without the prior  written  consent of the Company's  underwriter  (the
"Underwriter").

           The  complete  Prospectus  relating  to the  offering  by the Company
follows  immediately after this Explanatory  Note.  Following the Prospectus for
the offering by the Company are pages of the Prospectus  relating  solely to the
Selling  Securityholder  Securities,  including alternative front and back cover
pages  and   sections   entitled   "Concurrent   Public   Offering,"   "Plan  of
Distribution," and "Selling  Securityholders"  to be used in lieu of the section
entitled "Concurrent Registration of Common Stock" in the Prospectus relating to
the offering by the Company. Certain sections of the Prospectus for the offering
by the  Company,  such as "Use of Proceeds"  will not be used in the  Prospectus
relating to the Selling Securityholder Securities.



                                       -2-

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

                  SUBJECT TO COMPLETION, DATED OCTOBER 14, 1997
PROSPECTUS

                             OBJECTSOFT CORPORATION

                        1,366,050 Shares of Common Stock
                          1,366,050 Redeemable Warrants
                               -------------------

           This Prospectus is being delivered to the holders of 1,366,050 shares
of Common Stock,  par value $.0001 per share (the "Common  Stock") and 1,366,050
Redeemable  class A  Warrants  (the  "Class A  Warrants")  that  were  issued by
ObjectSoft  Corporation,  a Delaware  corporation (the "Company") in its initial
public offering of certain Units that became effective on November 12, 1996 (the
"Offering").  Each Class A Warrant  entitles the  registered  holder  thereof to
purchase  one share of Common  Stock at an exercise  price of $6.50,  subject to
adjustment, at any time until November 12, 2001. Beginning November 12, 1997 (or
earlier at the  discretion  of the  Company  with the  consent of the  Company's
underwriter,  Renaissance Financial Securities Corporation (the "Underwriter")),
the Class A Warrants  are subject to  redemption  by the Company at a redemption
price of $.10 per  Warrant  on 30 days'  prior  written  notice  to the  holders
thereof,  provided  the average  closing bid  quotation  of the Common  Stock as
reported on the NASDAQ SmallCap market ("NASDAQ"),  if traded thereon, or if not
traded thereon,  the average closing bid quotation of the Common Stock if listed
on a national  securities exchange (or other reporting system that provides last
sale prices),  has been at least 130% of the then current  exercise price of the
Class A Warrants  (initially,  $8.45 per share),  for a period of 20 consecutive
trading days ending within 15 days of the date on which the Company gives notice
of  redemption.  The Class A  Warrants  will be  exercisable  until the close of
business on the day  immediately  preceding the date fixed for  redemption.  See
"Description of Securities -- Class A Warrants."

           The Common  Stock and the Class A  Warrants  are listed on the NASDAQ
SmallCap Market ("NASDAQ") under the symbols OSFT and OSFTW, respectively. There
can be no assurance that an active  trading  market in the Company's  securities
will be  sustained.  On October 8, 1997,  the closing sales price for the Common
Stock and the Class A Warrants was $5.063 and $0.938, respectively.

                THE SECURITIES OFFERED HEREBY ARE SPECULATIVE AND
              INVOLVE A HIGH DEGREE OF RISK. ONLY INVESTORS WHO CAN
         BEAR THE RISK OF LOSS OF THEIR ENTIRE INVESTMENT SHOULD INVEST.
           FOR A DESCRIPTION OF CERTAIN RISKS REGARDING AN INVESTMENT
                  IN THE COMPANY SEE "RISK FACTORS" ON PAGE 10.

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

             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.

           Concurrently with this offering,  the Company registered the offering
of 1,086,963  shares of Common Stock that are  outstanding  or issuable upon the
exercise of warrants and 412,500 Class A Warrants  issuable upon the exercise of
warrants  (collectively,  the  "Selling  Securityholder  Securities")  under the
Securities Act, on behalf of certain of its  stockholders and holders of certain
warrants (the "Selling  Securityholders"),  pursuant to a Selling Securityholder
Prospectus  included within the Registration  Statement of which this Prospectus
forms a part. The Selling  Securityholders  include the Underwriter with respect
to 37,500  shares of Common Stock and 37,500 Class A Warrants  issuable upon the
exercise  of a warrant to  purchase  Units  (the  "Placement  Agent's  Warrant")
granted to the  Underwriter in its capacity as the placement agent for a private
offering,  in April - June  1996,  of bridge  loans  (the  "Bridge  Loans")  and
warrants (the "Bridge Loan Offering"). The Selling Securityholder Securities are
not part of this  Offering by the  Company.  The Company will not receive any of
the proceeds from the sale of the Selling  Securityholder  Securities,  but will
receive the proceeds of the exercise,  if any, of the various warrants  pursuant
to which certain of the Selling  Securityholder  Securities  are  issuable.  See
"Certain Transactions" and "Concurrent Offering."

================================================================================
                      Price to Warrant  Underwriting Discounts     Proceeds to
                         holders(1)       and Commissions(2)       Company(3)
- --------------------------------------------------------------------------------
Per Share.............     $6.50                 $.325               $6.175
- --------------------------------------------------------------------------------
Total (4).............   $8,879,325           $443,966.25         $8,435,358.75
================================================================================

                                                   (continued on following page)

                THE DATE OF THIS PROSPECTUS IS OCTOBER __, 1997

<PAGE>



(continued from previous page)



- --------------------------
(1)  Includes only Class A Warrants.  The exercise price of the Class A Warrants
     was arbitrarily  determined in connection with the Company's initial public
     offering in November 1996, and is not related to the Company's assets, book
     value,  operating  reserves or net worth.  There is no  assurance  that the
     market value of the shares of Common Stock underlying such Warrants will at
     any time after exercise thereof exceed the exercise price paid therefor.

(2)  Assumes the exercise of all of the Class A Warrants.

(3)  Pursuant to an Underwriting  Agreement entered into between the Company and
     the Underwriter on November 12, 1996, in connection with its initial public
     offering, the Company agreed to pay the Underwriter, a warrant solicitation
     fee of five (5%) percent of the  aggregate  exercise  price of the Warrants
     whose  exercise is  solicited by a member of the  National  Association  of
     Securities  Dealers,  Inc.  ("NASD") and meets certain other criteria.  The
     Company  cannot  presently   estimate  to  what  extent  any  such  warrant
     solicitation fee will be paid.

(4)  Assumes exercise of all of the presently outstanding Class A Warrants.  All
     funds received from the exercise of the Warrants will be turned over to the
     Company with the exception of: (i) expenses incurred in connection with the
     preparation of this Prospectus,  including  printing and professional  fees
     estimated at $45,000; and (ii) a five (5%) percent warrant solicitation fee
     which may be paid to the  Underwriter  upon the exercise of Warrants.  Does
     not include  additional  proceeds  to be  received by the Company  upon the
     exercise by the Underwriter of the Unit Purchase Options.




                                       -2-

<PAGE>




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

Prospectus Summary.....................................................        4
Risk Factors...........................................................       10
Use of Proceeds........................................................       22
Dividend Policy........................................................       22
Capitalization.........................................................       23
Selected Financial Data................................................       25
Management's Discussion and Analysis of Financial Condition and
 Results of Operations.................................................       26
Glossary...............................................................       29
Business...............................................................       31
Management.............................................................       45
Principal Stockholders.................................................       53
Certain Transactions...................................................       54
Description of Securities..............................................       56
Shares Eligible for Future Sale........................................       61
Concurrent Offering....................................................       62
Legal Matters..........................................................       62
Experts................................................................       62
Additional Information.................................................       63
Index to Financial Statements..........................................      F-1

           The  Company  is  subject  to  the  reporting   requirements  of  the
Securities  Exchange  Act of 1934  (the  "Exchange  Act"),  and,  in  accordance
therewith, files reports, proxy and information statements and other information
with the Securities and Exchange  Commission (the  "Commission").  Such reports,
proxy and  information  statements  and other  information  can be inspected and
copied at the Public Reference Section of the Commission at Room 1024, Judiciary
Plaza,  450 Fifth  Street,  N.W.,  Washington,  D.C.  20549 and at the following
regional  offices:  New York Regional Office,  Suite 1300, 7 World Trade Center,
New York, New York 10048, and Chicago Regional Office,  500 West Madison Street,
Suite 1400, Chicago,  Illinois 60661-2511,  and copies of such material may also
be  obtained  by mail from the Public  Reference  Section of the  Commission  at
prescribed rates.  Electronic registration statements made though the Electronic
Data Gathering  Analysis and Retrieval  ("EDGAR") System are publicly  available
through the Commission's Website (http://www.sec.gov).
See "Additional Information."

           The Company intends to furnish its  stockholders  with annual reports
containing  audited  financial  statements and such other reports as the Company
deems appropriate or as may be required by law.

           ObjectSoft(TM),  SmartStreet(TM),  SmartSign(TM),  OLEBroker(TM), and
CafeOLE(TM)  are trademarks of the Company.  This Prospectus also includes other
trademarks  and trade  names of the Company and  trademarks,  service  marks and
trade names of other companies,  including ActiveX(TM), a trademark of Microsoft
Corporation ("Microsoft").



                                       -3-

<PAGE>



                               PROSPECTUS SUMMARY

The  following  summary  is  qualified  in its  entirety  by the  more  detailed
information and the financial statements, including the notes thereto, appearing
elsewhere in this Prospectus. Unless otherwise indicated, all of the information
contained  herein  assumes that the  Underwriter's  Unit Purchase  Option is not
exercised and that no other  outstanding  options or warrants to purchase Common
Stock are exercised.  To aid the reader,  a Glossary of technical terms has been
included on page 29 of this Prospectus.


                                   THE COMPANY


           The Company  currently  provides  information  and  services  through
Interactive   Public  Access   Terminals   ("IPATs"  or   "Kiosks"),   known  as
SmartStreet(TM),   that  combine  the  advantages  of  local  and  wide  network
technology. Like an intranet, the communication between the IPAT and its servers
is  accomplished  over private,  secure lines.  Like an internet,  it enables an
organization to interact with the general public, not just its own employees and
customers.  Generally,  the IPATs have been installed in high density pedestrian
traffic  areas.  The Company  anticipates  that  revenues from the IPATs will be
provided by leasing fees paid by advertisers and service  providers and by usage
fees paid by consumers who obtain services through the IPATs.

           Prior  to 1996,  the  Company's  activities  consisted  primarily  of
consulting,  writing,  training  and custom  software  development  for  various
corporate and government clients,  including Microsoft Corporation ("Microsoft")
for which it produced  technical  papers and provided  consulting  services.  In
performance  of  these  activities,   the  Company  developed  skills  in  rapid
application  development and a base of courseware and reusable  software objects
to which it retains title.  In 1995, the Company  decided to direct these skills
and its expanding body of reusable  software  objects toward the  development of
services  through which it can derive revenue on a "per  transaction"  basis. It
initially developed and operated OLEBroker(TM),  an Internet-based  subscription
service  that  allows  customers  to search its  database of  information  about
software  objects,  find the  information  needed and at the customer's  option,
purchase needed objects on-line.  The Company  discontinued  active marketing of
OLEBroker(TM)  at the end of 1996 in  order  to  concentrate  on its  IPAT-  and
Internet-related  businesses.  However,  in connection  with the  development of
OLEBroker(TM),  the Company developed  significant  additional software objects,
which it then used in the  development  of technology  for the IPAT and Internet
service delivery  programs.  The Company  anticipates that the IPAT and Internet
service  delivery  programs will  constitute  the most  significant  part of its
business.  It may  continue  to engage in  consulting  activities  as  resources
permit. In selecting consulting opportunities,  the Company will focus primarily
on  assignments  in  connection  with  the  sale of IPAT  services  or that  can
otherwise enhance its skill base.

           In early 1996, as part of its IPAT Demonstration Project, the City of
New York (the  "City")  entered  into an  agreement  with the Company (the "City
Agreement")  to develop  public  IPATs to be located in City  offices  and other
public locations in an effort to expedite  transactions with the City. Under the
City Agreement,  the City agreed to lease the first five IPATs,  and the Company
may deploy  additional  IPATs  throughout the New York City area at its own risk
and expense,  subject to City approval of IPAT  locations.  The first five IPATs
were  deployed  in New York City in July  1996.  A sixth IPAT was  installed  in
August,  1997.  All IPATs  providing  City  services  for  information,  whether
operated  by the  Company or other  suppliers,  carry the City's  CityAccess(TM)
logo.  Pursuant to the City  Agreement,  the Company has developed IPATs through
which members of the public can obtain  access to the records of the  Department
of Buildings,  certain Department of Health services, including obtaining copies
(for  a fee)  of  birth  certificates,  death  certificates  and  dog  licenses,
obtaining public health information, and registering for certain courses offered
by the  Department  of  Health.  Information  on  City  government,  directional
information  and  information  about New York City's  events,  museums,  tourist
attractions,  shopping and similar matters is provided without fee. The City has
recently  requested  pricing  information  for extending  the City  Agreement to
include an  additional  12 to 36 IPATs to be installed  in the third  quarter of
1997. However, there can be no assurance that a contract for this extension will
ultimately be entered into.



                                       -4-

<PAGE>



           The  Company's  goal in designing  the  SmartStreet(TM)  IPATs was to
maximize potential use by developing software that would be inviting and easy to
use. The IPATs are designed so that a potential user is attracted to the IPAT by
digital  videos  played  from the upper  monitor.  Initially  these  videos will
include an "attract loop,"  narrated by the noted actor Tony Randall  (currently
Director of the National  Repertory Theater) and a message from Mayor Rudolph W.
Giuliani, as well as "spot"  advertisements.  The attract loop explains what can
be done with the IPATs and how to use them,  and shows people from many walks of
life using them successfully.

           The IPATs are  configured  to permit the Company to offer  additional
services provided either by the Company or third parties and to sell advertising
on such IPATs. The City Agreement requires the Company to pay to the City 50% of
advertising  and third party service  revenues from the first five IPATs and 15%
of such revenues from such additional  IPATs that carry the CityAccess logo. The
Company  plans to  exercise  these  rights and to  actively  solicit  additional
service   providers   and   advertisers.   The  Company  will  seek  to  provide
SmartStreet(TM) services to other municipalities, states and government agencies
and to  organizations  in the  private  sector  that  provide a large  volume of
information,  records and documents to the public.  The Company may also seek to
enter into agreements  with the City and other customers to provide  information
and  services  over  the  Internet,   in  order  to  significantly   expand  the
accessibility  of such  information  and services.  To date, the Company has not
entered into any agreements to offer any of the foregoing additional services or
products.

           In connection  with the  development  of the IPATs and the deployment
and operation of the first five IPATs,  the City agreed to pay to the Company an
aggregate  of  $661,080,  of which  $361,080  is  payable in the form of monthly
payments of $30,090  ($6,018  per IPAT),  which were  commenced  as of August 1,
1996,  and the  balance of  $300,000  is  payable in partial  amounts as certain
milestones  in the  development,  deployment  and  operation  of the  IPATs  are
achieved, of which $279,000 has been earned prior to September 30, 1997.

           For the first 43 weeks the  Company's  IPATs  were used an average of
2,434 times per week. In recent weeks average usage has exceeded  4,000 uses per
week.  In the most recent week for which  figures are  available,  the Company's
IPATs  averaged 805 uses per week each.  In  comparison,  IPATs of the other two
participants in the  demonstration  project  averaged 294 and 787 uses each. The
City has  indicated  that it intends to extend the  contract  through the end of
1998.

           The Company may also receive  transaction fees in connection with the
use of the IPATs by the public to obtain documents or certain other services. As
of May 31,  1997,  the first  five  IPATs were  available  only to provide  City
information  and  did  not  provide  transaction  services  or  carry  any  paid
advertising  or third  party  services.  Consequently,  no  revenues  have  been
generated  to date by user  transactions  or  advertising.  The amount of future
transaction and advertising revenues, if any, will depend on user and advertiser
acceptance of the IPATs.

           In August 1997,  ObjectSoft  announced the  development and immediate
availability of SmartSign(TM), a modular line of IPATs contained in an enclosure
that is only  7-1/2" in  depth,  with each  module  weighing  less than 70 lbs.,
making the units suitable for regular shipment through UPS and Federal Express.

           The modules  initially consist of (a) a Pentium class processor unit,
(b) an active-matrix touch screen, with optional sealed heavy-duty keyboard, and
optional  credit card reader,  (c) a printer unit with page printer and optional
receipt  printer,  (d) a  light-box  advertising  module  with  optional  plasma
display, and (e) an optional touch-sensitive light-box.  Although a working unit
has been  delivered and is  operational,  there can be no assurances  that there
will be any commercial sales of this line.

           As of  September  30, 1997 no revenues  have been  generated  by user
transactions  or  advertising.  The IPATs became  available  to support  on-line
inquiries into City databases as of June, 1997.

           Recently,  the Walt Disney Company agreed to a trial with advertising
of the IPATs installed in New York.



                                       -5-

<PAGE>



           Pursuant to the City Agreement,  the Company has the right to install
additional  IPATs in the City, at the Company's  risk and expense and subject to
certain  conditions  including  site approval by the City.  The City will not be
required  to  pay  additional  monthly  payments  for  such  IPATs,  but  it  is
anticipated,  although  there can be no  assurance,  that use by the public will
generate  transaction fees. The Company had commenced evaluating potential sites
and will seek to install up to 25 additional IPATs over the next year. The first
of these additional IPATs was installed in July 1997 in the Museum of Science in
Queens.

           At the time the City  Agreement  with the Company was  executed,  the
City also signed  similar  agreements  with two other  companies for  additional
IPATs.  The City  expects to evaluate  its success  with this program and, if it
deems it successful, to issue a Request for Proposals for competitive bidding to
supply additional IPATs throughout the City.

           The Company has established a strategic  relationship  with Microsoft
that it believes is important to its sales, marketing and support activities, as
well as to its product  development  efforts  relating  to its IPATs.  Microsoft
supports the Company in marketing its public access services, and has informally
agreed to exhibit the  Company's  IPATs in Microsoft  displays at various  trade
shows. It has also issued statements that included favorable references relating
to  the   Company's   products.   Microsoft   has  also   entered  into  various
non-disclosure agreements with the Company with respect to unannounced Microsoft
products,  under which the Company has the opportunity to have advance knowledge
of  software  technology  being  developed  by  Microsoft.  Microsoft  has  also
provided, and continues to provide, fee-based consulting services to the Company
through  Microsoft  Consulting.  Since  1994,  the  Company  has  served  as the
exclusive  regional  host and sponsor of Microsoft  Developer  Days,  an ongoing
series of technical  conferences  organized and operated by Microsoft.  The most
recent  conference  was held on March 19, 1997.  The  conference  attracted over
5,000  paid  registrants  and was  completely  sold out.  The  Company  has also
produced technical papers for, and provided  consulting  services to, Microsoft.
The next conference is expected to be held in February, 1998.

           The  Company  intends  to  market  IPATs  to  other   municipalities,
government  agencies and organizations in the private sector. In the future, the
Company may seek to make its transactional  services available over the Internet
and to make the Internet  available from the Company's  public IPATs.  Recently,
the  Company  was  the  successful  bidder  in  Seattle,   Washington,  for  the
installation of eight IPATs providing information regarding ferry service.

           ObjectSoft  Corporation was  incorporated in Delaware in January 1996
and is the  surviving  corporation  of the  merger  on  January  31,  1996  (the
"Merger") between it and its predecessor,  ObjectSoft Corporation,  a New Jersey
corporation ("ObjectSoft-NJ"), which was incorporated in December 1990. The sole
purpose  of the  Merger  was to effect a change  of the  corporate  domicile  of
ObjectSoft-NJ  to  Delaware.   The  Company  was  organized  as  a  wholly-owned
subsidiary  of  ObjectSoft-NJ;  prior to the Merger,  the Company  conducted  no
business  unrelated to its  organization or to effecting the Merger.  Throughout
this  Prospectus,  the "Company" will,  unless the context  otherwise  requires,
include ObjectSoft-NJ.

           The Company's executive offices are located at Continental Plaza III,
433 Hackensack  Avenue,  Hackensack,  New Jersey 07601;  its telephone number is
(201)  343-9100;  its facsimile  number is (201) 343- 0056; its Internet  e-mail
address is [email protected];  and its homepage on the World-Wide Web
is at http://www.objectsoftcorp.com.




                                       -6-

<PAGE>



                                  THE OFFERING


Securities being Offered Hereby.............1,366,050 shares of Common Stock and
                                            1,366,050  Class  A  Warrants.  Each
                                            Class A Warrant  entitles the holder
                                            thereof  to  purchase  one  share of
                                            Common Stock at a price of $6.50 per
                                            share, subject to adjustment, at any
                                            time  commencing  November  12, 1997
                                            until November 12, 2001. The Class A
                                            Warrants  may  be  redeemed  by  the
                                            Company commencing November 12, 1997
                                            (or earlier  with the consent of the
                                            Underwriter),  upon 30 days  notice,
                                            provided  the closing bid  quotation
                                            for the  Common  Stock has  exceeded
                                            130% of the  exercise  price  of the
                                            Class A Warrants  (initially,  $8.45
                                            per   share)   for   at   least   20
                                            consecutive   trading   days  ending
                                            within  15 days  of the  date of the
                                            notice    of     redemption.     See
                                            "Description of Securities."


Securities offered Concurrently                      
   by Selling Securityholders...............1,086,963 shares of common Stock and
                                            412,500     Class     A     Warrants
                                            (collectively,      the     "Selling
                                            Securityholder Securities"), all for
                                            resale by the holders  thereof or of
                                            certain  outstanding  warrants  (the
                                            "Selling Securityholders") from time
                                            to time  subject to the  contractual
                                            restrictions   pursuant   to   which
                                            certain Selling  Securityholders may
                                            not     sell      their      Selling
                                            Securityholder   Securities   for  a
                                            period of 12 months ending  November
                                            12, 1997  without the prior  written
                                            consent of the Underwriter.

Common Stock Outstanding
prior to Offering (1).......................4,082,676 shares

Common Stock to be Outstanding after
the Offering (1)............................4,082,676 shares

Class A Warrants  Outstanding prior to
the Offering (2)............................1,366,050 Class A Warrants

Risk Factors................................The   securities    offered   hereby
                                            involve a high  degree of risk.  See
                                            "Risk Factors".

Use of Proceeds.............................Proceeds  received  from exercise of
                                            the Class A Warrants are intended to
                                            be  used  for  working  capital  and
                                            general corporate purposes. See "Use
                                            of Proceeds."

NASDAQ symbols:
   Common Stock.............................OSFT
   Class A Warrants.........................OSFTW
- --------------

(1)  Does not include:  (i) 1,366,050 shares issuable upon exercise of the Class
     A Warrants  included in the Units offered in connection  with the Company's
     initial public  offering in November 1996,  (ii) 175,000 shares included in
     the Units  (and upon  exercise  of the Class A  Warrants  included  in such
     Units) issuable upon exercise of the  Underwriter's  Unit Purchase  Option,
     (iii) 143,333 shares  issuable upon exercise of warrants  issued to certain
     present and former members of senior  management (the "Officer  Warrants"),
     (iv) 750,000 shares included in the Units (and upon exercise of the Class A
     Warrants included in such


                                       -7-

<PAGE>



     Units) issuable upon exercise of warrants issued to investors in the Bridge
     Loan Offering (the "Bridge  Warrants"),  (v) 75,000 shares  included in the
     Units (and upon  exercise  of the Class A Warrants  included in such Units)
     issuable upon the exercise of the Placement  Agent's  Warrant issued to the
     Underwriter  in  connection  with the Bridge Loan  Offering,  (vi)  182,004
     shares issuable upon exercise of warrants (the "July 1996 Warrants") issued
     to investors in the Company's July and August 1996 private equity  offering
     (the "July 1996 Offering") of 273,001 units each consisting of one share of
     Common  Stock and the July 1996  Warrant  (the  "July 1996  Units"),  (vii)
     45,500  shares  issuable  upon  exercise of the warrant  (and the July 1996
     Warrants  issuable upon  exercise of such warrant)  issued to the placement
     agent of the July 1996  Offering  (the "July  Placement  Warrant"),  (viii)
     20,000 shares  issuable upon the exercise of warrants issued to a principal
     stockholder  of the  Company  in  connection  with  the  redemption  of the
     Company's  Series B Preferred  Stock,  (ix)  250,000  shares  reserved  for
     issuance  under the Company's  1996 Stock Option Plan,  options for 250,000
     shares  of  which  have  been   granted   after  taking  into  account  the
     cancellation  of an option  for 5,000  shares  and (x)  500,000  additional
     shares  reserved for issuance  under the Company's  1996 Stock Option Plan,
     subject to approval by the  holders of a majority of the  Company's  Common
     Stock if required. See "Business," "Management," "Certain Transactions" and
     "Description of Securities."

(2)  Does not include 500,000 Class A Warrants, of which (i) 87,500 are included
     in the units issuable upon the exercise of the Underwriter's  Unit Purchase
     Option,  (ii) 375,000 are included in the units  issuable upon the exercise
     of the Bridge Warrants, and (iii) 37,500 are included in the units issuable
     upon  the  exercise  of  the  Placement   Agent's  Warrant.   See  "Certain
     Transactions" and "Description of Securities."




                                       -8-

<PAGE>



                          SUMMARY FINANCIAL INFORMATION
                    (In thousands, except per share amounts)

           The summary financial information set forth below is derived from the
financial  statements  appearing elsewhere in this Prospectus.  Such information
should be read in  conjunction  with such  financial  statements,  including the
notes thereto.

<TABLE>
<CAPTION>
                                            Six Months Ended June 30,      Year Ended December 31,
                                            -------------------------      -----------------------
STATEMENT OF OPERATIONS DATA:                 1997           1996           1996           1995
                                              ----           ----           ----           ----
<S>                                       <C>            <C>            <C>            <C>        
Revenues:
     Consulting                           $   109,401    $   258,000    $   269,401    $   447,976
     Development and Training                  37,954         21,279        118,618
     Rental Income                            180,540        150,450
Net loss                                   (1,380,404)      (300,722)    (1,240,695)      (122,400)
Net loss applicable to common stock        (1,380,404)      (316,535)    (1,272,746)      (141,525)
Net loss per share of common stock              (0.34)         (0.11)         (0.45)         (0.05)
Weighted average number of common stock     4,050,952      2,800,734      2,848,943      2,797,134
outstanding



BALANCE SHEET DATA:                      June 30, 1997               December 31, 1996
                                         -------------               -----------------
Working capital                           $ 2,747,686                   $ 4,011,015 
Total assets                                3,703,883                     4,982,161
Accumulated deficit                        (3,530,554)                   (2,150,150)
Total stockholders' equity                  3,411,716                     4,729,120
</TABLE>

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





                                       -9-

<PAGE>



                                  RISK FACTORS


          An investment  in the  securities  offered  hereby is  speculative  in
nature and involves a high degree of risk. In addition to the other  information
in  this  Prospectus,   prospective  investors  should  carefully  consider  the
following  risk  factors  before  purchasing  the  securities  offered  by  this
Prospectus:


LIMITED OPERATING HISTORY; OPERATING LOSSES; ACCUMULATED DEFICIT

          The Company was founded in 1990, has only a limited  operating history
and  recently  changed  its focus  from  consulting  and  training  services  to
transactional and fee-based products and services. Consequently, any analysis of
the Company's  prior  operations has only minimal  relevance to an evaluation of
the Company, its current products and services, and its prospects.

          Although the Company has generated  revenues from  operations,  it has
experienced  losses.  The  Company  has  incurred,  and will  continue to incur,
significant  costs in connection  with the  development of its Intranet IPAT and
Internet  operations,  which may  result in  operating  losses.  There can be no
assurance that such operations will ultimately generate significant revenues for
the Company or that the Company will achieve profitable  operations.  As of June
30,  1997,   the  Company  had  an  accumulated   deficit  of  $3,530,554.   See
"Management's  Discussion  and  Analysis of Financial  Condition  and Results of
Operations" and the Financial Statements.


RECENT CHANGE OF OPERATING FOCUS

          The Company's Intranet-based SmartStreet(TM) IPAT service business, as
well as its Internet service business (consisting  primarily of the operation of
OLEBroker(TM)),  have been recently  created,  are limited in scope and have not
generated  significant  revenues to date. The operations to which the Company is
now devoting its resources are in the early stages of development.  There can be
no assurance  that the Company will be successful in attracting new customers or
retaining  current  customers  for its new business  divisions or in  generating
significant  revenues or profits from such  business  divisions.  The  Company's
prospects  must be considered in light of the risks,  expenses and  difficulties
frequently  encountered  by  companies  in their  early  stage  of  development,
particularly  companies in new and rapidly  evolving  markets.  To address these
risks,   the  Company  must,   among  other  things,   respond  to   competitive
developments,  attract,  retain and motivate  qualified product  development and
marketing personnel, continue to upgrade its existing technologies,  develop new
technologies  and  commercialize   products  and  services   incorporating  such
technologies.  There can be no assurance  that the Company will be successful in
addressing such risks.  The Company may also be required to enter into strategic
alliances  to  effect  cooperative  development  efforts  in  order  to have the
financial and  technical  resources to respond to changing  market  demands on a
timely  basis.  There  can be no  assurance  that  entities  with the  necessary
technical or financial  resources  will be willing to enter into such  alliances
with the Company on acceptable terms or at all. See "Management's Discussion and
Analysis of  Financial  Condition  and Results of  Operations"  and  "Business -
ObjectSoft Strategy."


BROAD DISCRETION IN USE OF PROCEEDS

          The  Company  has  broad  discretion  with  respect  to  the  specific
application  of the net proceeds to be obtained by the Company upon the exercise
of the Class A  Warrants.  Such  amounts  are  intended  to be used for  working
capital and general  corporate  purposes.  Thus,  purchasers of the Common Stock
upon exercise of the Warrants  will be  entrusting  their funds to the Company's
management,  upon whose  judgment the investors  must depend,  with only limited
information concerning management's specific intentions. See "Use of Proceeds."



                                      -10-

<PAGE>



DEPENDENCE ON NEW, UNTESTED PRODUCT

          The Company has recently  refocused its efforts to  concentrate on the
development of IPATs based on Internet  technology from which it hopes to derive
transaction-based and advertising revenues. In January 1996, the Company entered
into an  agreement  with  the  City of New  York,  as  part of the  City's  IPAT
Demonstration  Project,  pursuant  to which the  Company  agreed to install  and
operate a minimum of five IPATs at City  offices and other  locations to provide
expedited public access to various City government  services.  However, the City
has also entered into  agreements with two other entities to install and operate
IPATs.  The Company  installed its first five IPATs in July 1996, and such IPATs
have been operating since that time.

          The Company  anticipates that revenues from the IPATs will be provided
by leasing fees paid by the service  providers,  such as the City,  and by usage
fees paid by  consumers  who obtain  City or other  services  through the IPATs.
Although  IPATs  are in  operation  in  other  municipalities,  there  can be no
assurance  that the  Company's  IPATs will be able to operate  consistently  and
efficiently  to provide the  anticipated  services,  that members of the general
public will find the IPATs user-friendly,  that they will be comfortable with or
be willing to pay the additional  cost for the convenience of using the IPATs to
transact  business with the City or other service providers by electronic means,
that the City  will be  satisfied  with the  results  of the  operations  of the
Company's IPATs, or that even if the IPATs perform adequately, that the City and
other  potential  users of similar  IPATs will not opt for the  products  of the
Company's competitors. Although the Company has an agreement to provide IPATs to
Kings County, Washington (Seattle), its ability to market such services to other
potential  customers  will be highly  dependent on the success and acceptance of
the New York City  IPATs.  Furthermore,  the  municipalities,  states  and other
government  agencies that  constitute a primary  target market for the Company's
IPATs are subject to potentially severe budgetary  constraints and cuts that may
limit their ability to fund the acquisition of new technology such as the IPATs.

          In addition, the Company anticipates that a significant portion of the
revenues  related  to the IPATs  will  consist  of  leasing  fees and usage fees
derived by providing unrelated transactions,  such as restaurant information and
shopping services, to the users of the IPATs and from commercial  advertising by
local and national  companies  and  businesses.  There can be no assurance  that
commercial  entities  will be  interested  in  marketing  or  advertising  their
products and services by means of IPATs providing government services, that such
services  or  advertising  can be sold at rates  that will  provide  significant
revenues to the Company,  or that such  services or  advertising,  if commenced,
will prove to be effective and will be  continued.  See "Business - Products and
Services - SmartStreet(TM) IPAT Services."


RISKS RELATED TO OLEBROKER(TM) AND CONSULTING AND TRAINING SERVICES

          Although the  development of the  OLEBroker(TM)  service  included the
development of much of the software used in the development and configuration of
the Company's IPAT technology,  the service itself currently  generates  limited
revenues.  The Company  believes  that while there will continue to be a growing
market  for the  OLEBroker(TM)  service,  particularly  as the use of  Microsoft
Windows  programs  increases,  such  market  may  consist  primarily  of persons
involved  in  computer  programming,  rather  than  computer  users in  general.
Consequently,  the Company discontinued active marketing of OLEBroker(TM) at the
end of 1996 in order to concentrate on its IPAT and Internet-related businesses.

          The Company has historically provided consulting and training services
primarily  on a project  basis,  and  long-term  continuing  projects  have been
limited.  There  can  be no  assurance  that  the  Company  will  obtain  future
consulting projects. Furthermore, the Company will seek to accept consulting and
training  assignments  primarily in connection with the sale of IPAT services or
that will otherwise expand its skill base. See "Business - Products and Services
- - OLEBroker(TM) - Consulting, Training and Authoring Services."




                                      -11-

<PAGE>



UNCERTAINTY OF PRODUCT DEVELOPMENT

          It is common for hardware and software as complex and sophisticated as
that employed by the Company in its IPATs to experience  errors, or "bugs," both
during  development  and  subsequent  to commercial  introduction.  As IPATs are
installed in New York City,  the Company may identify such  problems,  either in
the software platforms developed by others or in its proprietary software. There
can be no assurance that all the potential problems will be identified, that any
bugs that are  located  can be  corrected  on a timely  basis or at all, or that
additional  errors will not be located in existing or future products at a later
time  or  when  usage   increases.   Any  such  errors  could  delay  commercial
introduction  or use of existing or new  products and require  modifications  in
systems that have already been installed.  Remedying such errors could be costly
and time consuming, and bugs involving the proprietary software of third parties
could  require the redesign of the  Company's  proprietary  software.  Delays in
debugging or modifying the Company's  products  could  materially  and adversely
affect the  Company's  competitive  position  with  respect to existing  and new
technologies and products offered by its competitors.  In particular,  delays in
remedying  existing  or newly  identified  errors in the  Company's  IPATs could
materially  and adversely  affect the Company's  ability to achieve  significant
market penetration with the IPATs.

VULNERABILITY TO TECHNOLOGICAL CHANGES; NEED FOR MARKET ACCEPTANCE

          The  markets the  Company  serves are  subject to rapid  technological
change,  changing customer requirements,  frequent new product introductions and
evolving  industry  standards  that may render  existing  products  and services
obsolete.  As a result,  the Company's position in its existing markets or other
markets  that it may enter could be eroded  rapidly by product  advancements  by
competitors.  The  life  cycles  of the  Company's  products  and  services  are
difficult to estimate.  The Company's future success will depend,  in part, upon
its  ability  to enhance  existing  products  and  services  and to develop  new
products and services on a timely basis. In addition,  its products and services
must keep pace with  technological  developments,  conform to evolving  industry
standards,  particularly  client/server and Internet  communication and security
protocols,  and  publishing  formats,  and  address  increasingly  sophisticated
customer needs. In particular, the success of the Company's IPATs will depend in
large measure on their being  user-friendly to the general public and capable of
operating  reliably.  There  can be no  assurance  that  the  Company  will  not
experience  difficulties that could delay or prevent the successful development,
introduction  and marketing of new products and  services,  or that new products
and services and enhancements  will meet the requirements of the marketplace and
achieve  market  acceptance.  If the Company is unable to develop and  introduce
products  and  services  in a timely  manner  in  response  to  changing  market
conditions  or customer  requirements,  the  Company's  financial  condition and
results of operations would be materially and adversely affected.


COMPETITION

          The Company is subject to competition  from different  sources for its
different services.  The Company's intranet IPAT business competes with numerous
companies, including IBM, North Communications, Golden Screens and NCR (formerly
a division of AT&T).  The City has also  awarded  contracts,  comparable  to the
contract awarded to the Company, to North Communications and DSSI (which awarded
a subcontract to Golden Screens), both of which have sold similar IPATs to other
municipalities.  After fulfillment of the initial contracts, if the City chooses
to install  additional  IPATs  throughout  the City of New York, it may award to
others,  and not the Company,  the contract to install  such  additional  IPATs.
Further,  there can be no assurance that other  municipalities or other entities
will seek to acquire  IPATs from the Company.  In addition,  if the use of IPATs
provided by the Company and others  proves to be successful in New York City and
other  municipalities  and  locations,  additional  companies  in the  software,
hardware and  communications  areas, among others, may seek to enter the market.
Many of such  competitors  may have  resources  far greater than the Company.  A
total of 19 companies competed for the contracts with the City of New York, many
of  which  can  be  expected  to  compete   aggressively  in  other  competitive
situations. See "Business -- Competition."




                                      -12-

<PAGE>



POSSIBLE DIFFICULTY IN COMPLYING WITH GOVERNMENT CONTRACT REQUIREMENTS

          The Company's IPATs are initially being marketed to entities including
municipalities,   states  and  other  government  agencies,   among  others.  As
governmental  authorities,  these  prospective  purchasers are subject to public
contract  requirements  which vary from one  jurisdiction to another and include
regulations  relating  to  insurance  coverage,   non-discrimination  in  hiring
practices, access to the disabled, and record-keeping, among other requirements.
Some public  contract  requirements  may be onerous or even  impossible  for the
Company to satisfy, such as large bonding  requirements,  and the Company may be
precluded  from  making  sales  in  these  jurisdictions.  In  addition,  public
contracts  frequently  are  awarded  only  after a  formal  competitive  bidding
process.  The process to date has been and may continue to be  protracted.  Even
following  contract award,  significant  delays in contract  implementation  are
possible. See "Business - Governmental Regulation."


RELIANCE ON MICROSOFT IN MARKETING

          The Company has  established a strategic  relationship  with Microsoft
that it believes is important to its sales, marketing and support activities, as
well as to its product development efforts relating to its IPATs.  Microsoft has
provided  technical and marketing  support to the Company in connection with the
development  and  marketing of its IPAT  services,  has  exhibited the Company's
IPATs in  Microsoft  displays  at  various  trade  shows and has  indicated  its
willingness  to  continue  to do so in the  future.  It has also  issued  public
statements that included favorable  references to the Company's products.  Since
1994,  the  Company has served as regional  director of  Microsoft's  "Developer
Days"  program,  an  on-going  series of  conferences,  the next one of which is
scheduled  for the  first  quarter  of 1997,  from  which  the  Company  derives
publicity and exposure to senior Microsoft personnel.  In addition,  the Company
also   benefits   from   Microsoft's   continued   willingness   to  enter  into
non-disclosure agreements with the Company with respect to unannounced Microsoft
products,  under which the Company has the opportunity to have advance knowledge
of software technology being developed by Microsoft.  There is no assurance that
Microsoft  will  continue  to  support  the  Company's  products,  continue  the
Company's  participation  in the  Developer  Days  program  or enter  into  such
agreements with the Company in the future.  In the event Microsoft were to sever
its relationships with the Company,  the Company's sales and financial condition
could be  severely  and  materially  and  adversely  affected.  See  "Business -
Products and Services - Relationship with Microsoft."


DEPENDENCE UPON MICROSOFT'S WINDOWS OPERATING SYSTEM

          The Company has  invested in software  built on  Microsoft's  Internet
Explorer, Windows NT and Windows 95 platforms and written in certain programming
languages  designed  for  these  operating  systems.  To the  extent  that  such
platforms  do  not  remain  competitive,   the  Company  might  have  to  expend
significant  time and  resources  to port its software to other  platforms.  Any
factor  adversely  affecting  the demand  for,  or use of,  Microsoft's  Windows
operating  system could have an impact on demand for the  Company's  products or
services causing a material adverse effect on the Company's business, results of
operations and financial condition.  Additionally, any changes to the underlying
components of the Windows  operating  system that would  require  changes to the
Company's products would materially  adversely affect the Company if it were not
able successfully to develop or implement such changes in a timely fashion.  See
"Business - Products and Services."

DEPENDENCE UPON COMMON CARRIERS AND INTERNET ACCESS PROVIDERS

          The Company is also dependent on various regulated common carriers and
unregulated  Internet  access  providers,  such as AT&T,  Bell Atlantic,  NYNEX,
SPRINT and  NYSERNET.  In the event such  carriers or  providers  cannot  timely
respond to the  Company's  requirements  for service,  fail to provide  reliable
service  or  increase  their  rates  substantially,  the  Company's  service  or
profitability  could be  materially  and  adversely  effected.  See  "Business -
Products and Services."



                                      -13-

<PAGE>



DEPENDENCE ON THE INTERNET

          Sales  of  the  Company's   Internet-related  products  and  services,
including its public access IPATs,  OLEBroker(TM)  and new or expanded  products
and  services,  if any,  will  depend in large part upon a robust  industry  and
infrastructure  for providing  commercial  Internet access and carrying Internet
traffic and upon  increased  commercial  use of the  Internet.  If the necessary
infrastructure  or complementary  products are not developed or available to the
Company on reasonable  terms, or if development of the Internet as a significant
commercial  marketplace  is  interrupted  or delayed,  the  Company's  business,
operating  results  and  financial  condition  could  be  materially   adversely
affected. See "Business - Products and Services."


LIMITED CUSTOMER BASE

          The long term success of the  Company's  business will depend not only
on the Company's ability to enter into arrangements with  municipalities,  other
government  entities and private  entities to make  services  available  through
IPATs  and with  advertisers  to use the  IPATs as an  advertising  medium,  but
ultimately upon the willingness of consumers to pay fees to transact business by
means of the IPATs.  To date,  the Company is operating  only six public  IPATs,
which were  installed  pursuant to the  agreement  with the City of New York and
which  have been  available  for  public  use for a short  period  of time.  The
decision  by the City to acquire  IPATs from  providers  other than the  Company
would  have a direct  and  materially  adverse  effect on the  prospects  of the
Company and could also  decrease  the  Company's  ability to market the IPATs to
other potential service providers and advertisers.  In addition, there can be no
assurance  that the  volume of use by  consumers  of the  IPATs to  obtain  City
services  and  conduct  other   transactions  will  be  sufficient  to  generate
significant revenues for the Company.

          The  Company  historically  has derived a  significant  portion of its
revenues from a relatively  limited  number of customers.  During the six months
ended June 30, 1997,  the City of New York  accounted  for 73% of the  Company's
revenues pursuant to the City Agreement.  During 1996, 2 customers accounted for
approximately  71% of the  Company's  revenues,  and during 1995,  two customers
accounted for approximately 48% of revenues. The Company provided consulting and
related  services,  and more recently,  services  related to the  development of
OLEBroker(TM) and Intranet and IPAT technology, to such customers.  There can be
no  assurance  that such  customers or others will retain the Company to install
IPATs or provide  such  services in the future.  Furthermore,  no  customers  of
OLEBroker(TM)  account for a material  portion of the  Company's  revenues,  and
there can be no assurance that the Company will be able to develop a significant
customer base for this service. See "Business Customers."


RISK OF MANUFACTURING ACTIVITIES

          The  Company's  IPATs  involve  the  design  by the  Company,  and the
engineering  and  manufacture by  subcontractors,  of the hardware and graphical
components of the IPATs.  Only a limited number of IPATs have been fabricated to
date,   so  it  is  difficult   for  the  Company  to  predict  if  its  current
subcontractors  will be able to  engineer  and produce  IPATs on a  satisfactory
basis. While the Company believes that it could arrange to have IPATs fabricated
by other  subcontractors on comparable terms, there can be no assurance that the
need to establish  relationships with other  subcontractors  would not result in
costs and delays to the Company.  The future  success of the Company will depend
in  part on its  ability  to  retain,  and  maintain  good  relationships  with,
subcontractors  in order to assure the timeliness and quality of the manufacture
of its  IPATs.  See  "Business  Products  and  Services -  SmartStreet(TM)  IPAT
Services - SmartStreet(TM) IPAT Technology."




                                      -14-

<PAGE>



POTENTIAL FLUCTUATIONS IN QUARTERLY OPERATING RESULTS

          The Company's  quarterly operating results have in the past and may in
the future  vary  significantly  depending  upon  factors  such as the timing of
significant  orders,  which in the past have  been,  and will in the  future be,
delayed from time to time by delays in the  contracting  process.  The potential
customers  for the  Company's  IPATs are  expected  to  include  municipalities,
government  agencies and large  organizations;  that is, entities that typically
engage in extended competitive bidding, approval and negotiation procedures with
respect to contracts,  with no assurance  that the contract  will  ultimately be
awarded to the  Company.  Additional  factors  contributing  to  variability  of
operating  results  include the pricing and mix of services and products sold by
the Company,  terminations of service, new product  introductions by the Company
and its  competitors,  market  acceptance  of new and  enhanced  versions of the
Company's products and services, changes in pricing or marketing policies by its
competitors and the Company's responses thereto, the Company's ability to obtain
sufficient  vendors,  to obtain  supplies of sole or limited source  components,
changes in the Company's  network  infrastructure  costs,  as a result of demand
variation or otherwise,  the  lengthening  of the Company's  sales cycle and the
timing of the expansion of the Company's network  infrastructure.  Variations in
the timing and amounts of revenues  and costs  could have a  materially  adverse
effect  on  the  Company's  quarterly   operating  results.   See  "Management's
Discussion and Analysis of Financial Condition and Results of Operations."


DEPENDENCE ON KEY PERSONNEL

          The  Company's   performance   is   substantially   dependent  on  the
performance of its executive  officers and key employees,  and on its ability to
attract  key  personnel.  In  particular,  the future  success of the Company is
dependent upon the personal efforts of the Company's founders, David E. Y. Sarna
and George J. Febish, each of whom is a director and an executive officer of the
Company.  Messrs. Sarna and Febish have long-term employment agreements with the
Company.  The Company has in place key person life insurance policies,  of which
it is the beneficiary, on the lives of Messrs. Sarna and Febish in the amount of
$1,000,000 each. However,  the loss of the services of its executive officers or
other key  employees  could delay the Company's  ability to fully  implement the
operating  strategy,  which  could  have  a  materially  adverse  effect  on the
business,  operating  results  and  financial  condition  of  the  Company.  See
"Business - ObjectSoft Strategy" and "Management."


ATTRACTION AND RETENTION OF EMPLOYEES AND CONTRACT PROVIDERS

          The  Company's  success  will depend in large part upon its ability to
attract,  develop,  motivate  and retain  highly  skilled  technical  employees,
particularly  software developers,  project managers and other senior personnel,
as well as independent providers of creative content for the Company's IPATs and
websites.  Qualified  project  managers and skilled  developers  with  Intranet,
Internet and ActiveX(TM)  skills are in particularly great demand and are likely
to remain a limited  resource for the foreseeable  future.  Although the Company
expects to  continue  to be able to attract  and  retain  sufficient  numbers of
highly skilled technical employees, developers, project managers and independent
content providers for the foreseeable future, there can be no assurance that the
Company will be able to do so. The loss of some or all of the Company's  project
managers and other senior  personnel  could have a materially  adverse impact on
the Company,  particularly  on its ability to secure and  complete  engagements.
Other than Messrs. Sarna and Febish, no other senior personnel have entered into
employment  agreements obligating them to remain in the Company's employ for any
specific  term;  however,  substantially  all key  employees  of the Company are
parties to nonsolicitation,  confidentiality and noncompetition  agreements with
the Company. See "Business - Employees" and "Management."




                                      -15-

<PAGE>



DEPENDENCE ON PROPRIETARY TECHNOLOGY

          The Company's success and ability to compete is dependent in part upon
its proprietary technology.  While the Company relies on trade secret, contract,
trademark and copyright law to protect its technology, the Company believes that
factors such as the  technological  and creative  skills of its  personnel,  new
product  developments,  frequent  product  enhancements,  name  recognition  and
reliable product  maintenance are more essential to establishing and maintaining
a technology leadership position. The Company presently has no patents or patent
applications  pending.  There can be no  assurance  that others will not develop
technologies  that are  similar or  superior to the  Company's  technology.  The
source  code for the  Company's  proprietary  software is  protected  as a trade
secret.  In  addition,  except for  SmartSign(TM),  the Company does not sell or
license its technology to third parties,  but rather delivers  services thorough
its IPATs and OLEBroker(TM),  its proprietary software is not disclosed to third
parties.  Despite  the  Company's  efforts to protect  its  proprietary  rights,
unauthorized  parties may  attempt to copy or  otherwise  obtain  aspects of the
Company's  products or to obtain and use information that the Company regards as
proprietary   or  to  develop   similar   technology   independently.   Policing
unauthorized use of the Company's products is difficult. In addition,  effective
trade secret and copyright  protection  may be unavailable or limited in certain
foreign countries. There can be no assurance that the steps taken by the Company
will prevent misappropriation of its technology. In addition,  litigation may be
necessary in the future to enforce the Company's  intellectual  property rights,
to protect the Company's  trade secrets,  to determine the validity and scope of
the proprietary rights of others, or to defend against claims of infringement or
invalidity.  Such litigation could result in substantial  costs and diversion of
resources and could have a material  adverse  effect on the Company's  business,
operating results or financial condition.

          Certain  technology  used in the  Company's  products  or  services is
licensed or leased from third parties,  generally on a nonexclusive basis. While
the licenses  involved are primarily  "shrink wrap  licenses;" that is, licenses
available to anyone who purchases  publicly  available  software  programs,  the
termination  of any of these  licenses  or leases or the  discontinuance  of the
underlying  programs  may  have a  material  adverse  effect  on  the  Company's
operations.  Replacement  of  certain  technologies  licensed  or  leased by the
Company  could be  costly  and  could  result  in  product  delays  which  would
materially and adversely affect the Company's operating results. While it may be
necessary or desirable in the future to obtain other licenses or leases relating
to one or more of the  Company's  products or services or relating to current or
future technologies,  there can be no assurance that the Company will be able to
do so on  commercially  reasonable  terms or at all. See "Business - Proprietary
Rights."


RISK OF SYSTEM FAILURE; SECURITY RISKS; LIABILITY RISKS

          The  Company's  operations  are  dependent  upon its ability,  and the
ability of its  suppliers,  such as AT&T,  Bell Atlantic,  NYSERNET,  SPRINT and
NYNEX,  to  protect  its  network   infrastructure  against  damage  from  fire,
earthquakes, power loss, telecommunications failures and similar events. Despite
precautions taken by the Company and its suppliers,  the occurrence of a natural
disaster or other  unanticipated  problems at the Company's  network  operations
center or IPATs in the future could cause interruptions in the services provided
by  the  Company.  In  addition,  failure  of the  Company's  telecommunications
providers to provide the data communications capacity required by the Company as
a result of a natural disaster,  operational  disruption or for any other reason
could cause interruptions in the services provided by the Company. Any damage or
failure  that causes  interruptions  in the  Company's  operations  could have a
material  adverse  effect on the  Company's  business,  financial  condition and
results of operations.

          Despite  the  implementation  of  security  measures,  the core of the
Company's  network  infrastructure  is vulnerable to computer  virus attacks and
other disruptive problems. The Company and Internet access providers have in the
past experienced, and may in the future experience,  interruptions in service as
a result of the accidental or intentional actions of Internet users, current and
former employees or others.  Unauthorized use could also potentially  jeopardize
the security of confidential  information  stored in the computer systems of the
Company and its  customers,  which may result in liability of the Company to its
customers and also may deter potential


                                      -16-

<PAGE>



users.  Although the Company intends to continue to implement  industry-standard
security  measures,  such measures have been circumvented in the past, and there
can be no  assurance  that  measures  implemented  by the  Company  will  not be
circumvented in the future.  Eliminating  computer viruses and alleviating other
security problems may require  interruptions,  delays or cessation of service to
the  Company's  customers  which  could  have a material  adverse  effect on the
Company's business, financial condition and results of operations.

          The Company's  success will depend upon the capacity,  reliability and
security of its network infrastructure,  including processing capability and the
facilities  and capacity  leased from access  providers  and  telecommunications
vendors.   The   Company   must   continue  to  expand  and  adapt  its  network
infrastructure as the number of users and the amount of information they wish to
transfer increases,  and to meet changing customer  requirements.  The expansion
and adaptation of the Company's network  infrastructure will require substantial
financial,  operational and management resources. There can be no assurance that
the Company will be able to expand or adapt its network  infrastructure  to meet
additional demand or its customers' changing  requirements on a timely basis, at
a commercially  reasonable cost, or at all. Any failure of the Company to expand
its  network  infrastructure  on a timely  basis or adapt it either to  changing
customer  requirements or to evolving  industry  standards could have a material
adverse  effect on the Company's  business,  financial  condition and results of
operations.

          The IPATs that were  installed  in various  locations in New York City
since July 1996 have only been  operating  for a short time,  so the Company has
only limited  experience with actual consumer  interaction with the IPATs. While
the Company has designed the IPATs to be resistant to vandalism, there can be no
assurance  that vandals will not succeed in damaging or disabling the IPATs.  In
addition,  although the Company believes it is unlikely,  users of the IPATs may
seek to hold the Company  liable for injuries  allegedly  incurred in connection
with the use of the IPATs.

          While the Company maintains  insurance covering , among other things ,
losses resulting from business interruptions caused by system failures,  damages
to IPATs or claims by users of the IPATs,  with an annual  limit of  $2,000,000,
and a $5,000,000 umbrella policy,  there can be no assurance that such insurance
will  provide  sufficient  coverage or that if there are multiple  claims,  such
insurance  will not be terminated  or will be available for terms  affordable to
the Company. See "Business - Products and Services."


GOVERNMENT REGULATION; POTENTIAL LIABILITY FOR INFORMATION AND
CONTENT DISSEMINATED THROUGH NETWORK

          The  Company  is not  currently  subject to direct  regulation  by the
Federal  Communications  Commission or any other agency,  other than regulations
applicable  to  businesses   generally  and   businesses   doing  business  with
governmental agencies. In connection with its contract with the City of New York
and  future  contracts,  if any,  with  the  City and  other  municipalities  or
government  entities,  the Company  will have to comply  with such  regulations,
including bidding procedures and record-keeping,  audit, insurance,  bonding and
anti-discrimination provisions, among others.

          Changes in the regulatory  environment relating to the Internet access
industry  could have an adverse  effect on the  Company's  business.  Due to the
increase in Internet use and publicity, it is possible that laws and regulations
may be adopted with respect to the Internet,  including with respect to privacy,
pricing and characteristics of products or services.  The Company cannot predict
the impact,  if any,  that future laws and  regulations  or legal or  regulatory
changes may have on its business.

          The law relating to the  liability of on-line  services  companies and
Internet  access  providers for information  carried on or disseminated  through
their systems is currently unsettled. Several private lawsuits seeking to impose
such liability upon on-line services companies and Internet access providers are
currently pending. In addition, legislation has been proposed which would impose
liability for or prohibit the  transmission  on the Internet of certain types of
information and content. In the event the Company were to make services such


                                      -17-

<PAGE>



as the one offered through its IPATs available over the Internet, the imposition
upon Internet access providers of potential liability for information carried on
or  disseminated  through  their  systems could require the Company to implement
measures  to reduce  its  exposure  to such  liability,  which may  require  the
expenditure  of substantial  resources,  or to  discontinue  certain  product or
service  offerings.  The increased  attention focused upon liability issues as a
result of these lawsuits and  legislative  proposals  could impact the growth of
Internet use.  While the Company  carries  insurance,  it may not be adequate to
compensate the Company in the event the Company  becomes liable for  information
carried  on or  disseminated  through  its  systems.  Any costs not  covered  by
insurance  incurred as a result of such  liability or asserted  liability  could
have a material adverse effect on the Company's  business,  financial  condition
and results of operations.


CONTINUING CONTROL BY CURRENT MANAGEMENT

          As of the date of this  Prospectus.,  David E. Y. Sarna, the Company's
Chairman and Co-Chief  Executive  Officer,  and George J. Febish,  the Company's
President  and  Co-Chief  Executive  Officer,  each of whom is a director of the
Company and a principal  stockholder  of Company,  together with The David E. Y.
Sarna  Family  Trust  and  The  George  J.  Febish  Family  Trust  (the  trusts,
collectively,  the  "Family  Trusts"),   beneficially  own,  in  the  aggregate,
approximately  42% of the issued and  outstanding  shares of Common Stock.  As a
result,  assuming no  exercise of any of the Class A Warrants or other  warrants
and  options  issued by the  Company,  and  subject to the effect of  additional
issuances of voting shares by the Company in the future, these stockholders will
have  effective  control  over the  Company  and on the  outcome of any  matters
submitted to the Company's stockholders for approval,  which influence might not
be consistent  with the interests of other  stockholders.  In addition,  if they
were to act in concert,  they would be able to elect a majority of the Company's
directors,  deter or cause a change in  control  of the  Company  and  otherwise
generally control the Company's affairs. See "Principal Stockholders."


FUTURE CAPITAL NEEDS; UNCERTAINTY OF ADDITIONAL FINANCING

          The Company's  current  policy is to own and operate its IPATs,  which
may require  substantial  capital  investment.  It is the Company's intention to
enter into lease  financing  arrangements  for the IPATs.  While the Company has
entered  into such an  arrangement  to cover a portion of the costs of the first
five IPATs,  it has not entered into an agreement for such  financing for future
IPATs,  if any, and there can be no  assurance  that it will be able to do so on
acceptable  terms or at all.  The  Company  may need to raise  additional  funds
through  public or private debt or equity  financings in order to take advantage
of  unanticipated   opportunities,   including   acquisitions  of  complementary
businesses or technologies,  or to develop new products or otherwise  respond to
unanticipated  competitive  pressures.  In addition,  if the Company experiences
rapid  growth,  it may  require  additional  funds to expand its  operations  or
enlarge its organization.  In any such event, continued operation of the Company
may be dependent on the ability of the Company to procure  additional  financing
through  sales of  additional  equity or debt.  If the Company were to issue any
equity or convertible debt securities,  such issuance could substantially dilute
the  interests of the  Company's  then existing  security  holders.  Such equity
securities may also have rights,  preferences  or privileges  senior to those of
the  holders of the  Company's  Common  Stock.  There can be no  assurance  that
additional  financing will be available on terms favorable to the Company, or at
all. If adequate  funds are not  available or are not  available  on  acceptable
terms,  the  Company  may  not  be  able  to  take  advantage  of  unanticipated
opportunities,  develop  new  products  or  otherwise  respond to  unanticipated
competitive pressures.  Such inability could have a materially adverse effect on
the Company's business,  financial condition and results of operations. See "Use
of Proceeds,"  "Management's  Discussion and Analysis of Financial Condition and
Results of  Operations  -  Liquidity  and  Capital  Resources"  and  "Business -
ObjectSoft Strategy."




                                      -18-

<PAGE>



DIVIDENDS

           Other than  distributions  made prior to 1993, when the Company was a
closely-held  "S  corporation,"  the Company has not paid any  dividends  on its
Common Stock in the past,  and does not  anticipate  that it will declare or pay
any dividends in the foreseeable future. See "Dividend Policy."


POSSIBLE  NEGATIVE  EFFECT ON  TRADING  OF WARRANT  SOLICITATION  ACTIVITIES  OF
UNDERWRITER

          The Underwriter may participate in the solicitation of the exercise of
the Class A Warrants. In connection with the solicitation of the Class A Warrant
exercises  the  Underwriter  and  any  other  soliciting  broker-dealer  will be
prohibited  from engaging in any  market-making  activities  with respect to the
Company's  securities for certain periods of time. As a result,  the Underwriter
or other  soliciting  broker-dealer  may be unable to  provide a market  for the
Company's  securities,  should it desire to do so, during certain  periods while
the Class A Warrants are  exercisable.  In addition,  under applicable rules and
regulations  under the Exchange Act, any person engaged in the  distribution  of
the  Selling   Securityholder   Securities  may  not  simultaneously  engage  in
market-making  activities  with respect to any securities of the Company for the
applicable  "cooling off" period (at least two and possibly nine business  days)
prior to the commencement of such  distribution.  Accordingly,  in the event the
Underwriter  is  engaged  in  a  distribution  of  any  Selling   Securityholder
Securities,  it will not be able to make a market  in the  Company's  securities
during the applicable restrictive period. Such restrictions may adversely affect
the price and  liquidity  of the  Common  Stock  and the Class A  Warrants.  See
"Description of Securities" and "Concurrent Offering."


SHARES ELIGIBLE FOR FUTURE SALE; REGISTRATION RIGHTS

          Except for  1,366,050  shares of Common Stock issued by the Company in
connection  with its initial public  offering in November 1996 and 39,500 shares
of Common Stock sold by certain Selling Securityholders since November 12, 1996,
all of  the  shares  of  Common  Stock  currently  issued  and  outstanding  are
"restricted  securities,"  as that term is defined  under  Rule 144  promulgated
under the Securities Act in that such shares were issued and sold by the Company
in private transactions not involving a public offering. In general,  under Rule
144 as  currently  in effect,  a person,  including an affiliate of the Company,
after  at  least  one year has  elapsed  from  the  sale by the  Company  or any
affiliate  of the  restricted  securities,  can (along with any person with whom
such  individuals is required to aggregate  sales) sell,  within any three-month
period,  a number of shares of  restricted  securities  that does not exceed the
greater of 1% of the total number of outstanding  shares of the same class,  or,
if the Common Stock is quoted on NASDAQ or a stock exchange,  the average weekly
trading volume during the four calendar  weeks  preceding the sale. A person who
has not been an  affiliate  of the Company for at least three  months,  after at
least two years have elapsed from the sale by the Company or an affiliate of the
restricted securities, is entitled to sell such restricted shares under Rule 144
without  regard  to  any of  the  limitations  described  above.  The  Company's
executive  officers,  David E. Y.  Sarna and  George J.  Febish,  and the Family
Trusts have agreed not to sell or otherwise  transfer any of their securities in
the Company for a period of 18 months  commencing  November 12, 1996 without the
prior  written  consent of the  Underwriter,  and have agreed with various state
securities  administrators not to sell (other than in a pledge or hypothecation)
any of  their  shares  of  Common  Stock  for a  period  ending  on  the  second
anniversary  of  the  execution  date  of  the  City  Agreement.   In  addition,
concurrently  with this offering,  the Company is registering  for resale by the
Selling  Securityholders  1,086,963  shares of Common Stock and 412,500  Class A
Warrants  that are  outstanding  or  issuable  upon the  exercise  of  currently
exercisable  warrants;  however,  the  Selling  Securityholders  (other than the
Underwriter)  have agreed not to sell any of such  securities for a period of 12
months  ending  November  11,  1997,  without the prior  written  consent of the
Underwriter.  Furthermore,  certain holders of the Company's  outstanding Common
Stock,  warrants and options (including  current and former executive  officers)
have "piggyback" registration rights and/or demand registration rights that they
may exercise commencing November 12, 1997.



                                      -19-

<PAGE>



          No prediction  can be made as to the effect,  if any, the future sales
of Common Stock or the availability of Common Stock for future sale will have on
the market  price of the Common  Stock  prevailing  from time to time.  Sales of
substantial  amounts of Common Stock  (including  shares issued upon exercise of
stock options or warrants) in the public market following this offering,  or the
perception that such sales could occur, could adversely affect prevailing market
prices of the Common  Stock.  See  "Description  of  Securities  -  Registration
Rights" and "Shares Eligible For Future Sale."


EFFECT OF OUTSTANDING WARRANTS, OPTIONS AND CONVERTIBLE SECURITIES

          The Company has  outstanding  warrants  to  purchase an  aggregate  of
412,500  Units,  all of which are  exercisable at a price per Unit below the per
Unit offering  price of the Units  offered by the Company in its initial  public
offering in November  1996. In addition,  412,500 shares of Common Stock will be
issuable upon the exercise of the Class A Warrants issuable upon the exercise of
such outstanding  warrants.  The Company also has outstanding  other options and
warrants to purchase an aggregate of 490,337 shares of Common Stock (in addition
to the July Placement  Warrant to purchase (1) 27,300 shares of Common Stock and
(2) July 1996 Warrants to purchase 18,200 shares),  of which all except warrants
to purchase  20,000 shares of Common Stock are  exercisable at a price below the
per share offering price  (assuming no value is ascribed to the Class A Warrants
included in the Units) of the Units offered by the Company in its initial public
offering.  The Company has also  granted to the  Underwriter  the Unit  Purchase
Option,  consisting  of the right to purchase,  commencing on November 12, 1997,
87,500 Units.  The sale of 1,086,963  shares of Common Stock, as well as 412,500
Class A  Warrants,  has been  registered  in the  Concurrent  Offering,  and the
Company has granted  certain  demand and  piggyback  registration  rights to the
holders of certain shares of Common Stock,  outstanding options and warrants and
the  Underwriter's  Unit Purchase  Option.  While certain  holders of certain of
these  rights  (including  certain  Selling   Securityholders   other  than  the
Underwriter)  have agreed not to sell the securities  issuable upon the exercise
of  outstanding  options and  warrants for 12 months  ending  November 11, 1997,
these rights could result in substantial expense to the Company and restrict the
Company's ability to obtain future  financing.  The exercise of such options and
warrants and the sale of the Common Stock subject to these  registration  rights
would  have a  dilutive  effect  on the  Company's  stockholders.  See  "Certain
Transactions,"  "Description of Securities  Registration Rights" and "Concurrent
Offering."


ADVERSE EFFECT OF REDEMPTION OF CLASS A WARRANTS

          The Company  has the right to redeem the Class A Warrants,  commencing
November 12, 1997 (or earlier,  with the consent of the  Underwriter),  provided
that the average  closing bid price of the Common Stock has exceeded 130% of the
then current exercise price of the Class A Warrants (initially $8.45 per share),
for a period of 20  consecutive  trading days ending within 15 days prior to the
date on which the Company gives notice of redemption.  If the Company gives such
notice of redemption,  holders of the Class A Warrants will lose their rights to
exercise the Warrants  after the date fixed therein for their  redemption.  Upon
the  receipt of a notice of  redemption  of the Class A  Warrants,  the  holders
thereof  would be  required  to (i)  exercise  the Class A Warrants  and pay the
exercise  price at a time when it may  disadvantageous  for them to do so,  (ii)
sell the Class A Warrants  at the then  market  price,  if any,  when they might
otherwise  wish to hold the Class A  Warrants  or (iii)  accept  the  redemption
price,  which is likely to be  substantially  less than the market  value of the
Class A Warrants at the time of  redemption.  See  "Description  of Securities -
Class A Warrants."




                                      -20-

<PAGE>



NECESSITY  OF  FUTURE  REGISTRATION  OF  CLASS A  WARRANTS  AND  STATE  BLUE SKY
REGISTRATION; EXERCISE OF CLASS A WARRANTS

          Although  Class A Warrants  were not  knowingly  sold to purchasers in
jurisdictions  in which the Class A Warrants  are not  registered  or  otherwise
qualified for sale or exempt, purchasers may buy or have bought Class A Warrants
in the  after-market  or may move or have  moved to  jurisdictions  in which the
Class A Warrants and the Common Stock underlying the Class A Warrants are not so
registered  or qualified or exempt.  In this event,  the Company would be unable
lawfully to issue Common Stock to those persons desiring to exercise their Class
A Warrants (and the Class A Warrants will not be  exercisable  by those persons)
unless  and until the  Class A  Warrants  and the  underlying  Common  Stock are
registered  or  qualified  for sale in  jurisdictions  in which such  purchasers
reside or an exemption  from such  registration  or  qualification  requirements
exists in such jurisdictions. There can be no assurance that the Company will be
able to effect any required registration or qualification.

          The Class A Warrants offered hereby will not be exercisable unless the
Company maintains a current  registration  statement on file with the Commission
either by filing  post-effective  amendments  to the  Registration  Statement of
which this Prospectus is a part or by filing a new  registration  statement with
respect to the exercise of such Class A Warrants.  The Company has agreed to use
its best efforts to file and maintain,  so long as the Class A Warrants  offered
hereby are  exercisable,  a current  registration  statement with the Commission
relating to such Class A Warrants and the shares of Common Stock underlying such
Class A Warrants.  However, there can be no assurance that it will do so or that
such Class A Warrants or such underlying  Common Stock will be or continue to be
so registered.

          The value of the Class A Warrants  could be  adversely  affected  if a
then current prospectus  covering the Common Stock issuable upon exercise of the
Class  A  Warrants  is  not  available  pursuant  to an  effective  registration
statement or if such Common Stock is not  registered  or qualified for resale or
exempt from  registration or  qualification  in the  jurisdictions  in which the
holders of Class A Warrants  reside.  See  "Description  of Securities - Class A
Warrants."


POSSIBLE  NEGATIVE  EFFECT  OF  ANTI-TAKEOVER  PROVISIONS,  STAGGERED  BOARD AND
PROVISIONS RELATING TO STOCKHOLDER ACTIONS

          Certain  provisions of Delaware law and the Company's  Certificate  of
Incorporation,  as amended,  and its Amended and  Restated  Bylaws could make it
more difficult for a third party to acquire,  and could discourage a third party
from attempting to acquire,  control of the Company. Certain of these provisions
allow the Company to issue  Preferred  Stock with rights  senior to those of the
Common Stock without any further vote or action by the  stockholders,  eliminate
the  right  of  stockholders  to act  by  written  consent  and  impose  various
procedural  and  other  requirements  which  could  make it more  difficult  for
stockholders to effect certain  corporate  actions.  The  classification  of the
Company's  Board of  Directors  could  have the  effect of  delaying a change in
control of the  Company.  In  addition,  the  Company  has  5,000,000  shares of
authorized  Preferred Stock, which the Company could issue in the future without
further stockholder  approval and upon such terms and conditions,  and have such
rights, privileges and preferences, as the Board of Directors may determine. The
rights of the holder of Common  Stock will be subject  to, and may be  adversely
affected by, the rights of the holders of Preferred  Stock that may be issued in
the future.  The Company has no current plans to issue any additional  Preferred
Stock.  See  "Certain  Transactions,"   "Management  -  Executive  Officers  and
Directors and  "Description of Securities - Preferred  Stock -Delaware  Takeover
Statute and Certain Charter Provisions."


LIMITATIONS ON LIABILITY OF DIRECTORS AND OFFICERS

          The  Certificate  of  Incorporation,  as amended,  and the Amended and
Restated  Bylaws of the Company  contain  provisions  limiting the  liability of
directors of the Company for monetary damages to the fullest extent  permissible
under  Delaware law.  This is intended to eliminate the personal  liability of a
director for monetary


                                      -21-

<PAGE>



damages on an action  brought by or in the right of the  Company for breach of a
director's  duties to the Company or its stockholders  except in certain limited
circumstances.  In addition,  the Certificate of Incorporation,  as amended, and
the Amended and Restated  Bylaws  contain  provisions  requiring  the Company to
indemnify  directors,  officers,  employees and agents of the Company serving at
the request of the Company against  expenses,  judgments  (including  derivative
actions), fines and amounts paid in settlement.  This indemnification is limited
to actions  taken in good faith in the  reasonable  belief  that the conduct was
lawful  and in or not  opposed  to  the  best  interests  of  the  Company.  The
Certificate of  Incorporation,  as amended,  and the Amended and Restated Bylaws
provide for the  indemnification  of directors and officers in  connection  with
civil,  criminal,  administrative  or  investigative  proceedings when acting in
their capacities as agents for the Company.  The foregoing provisions may reduce
the likelihood of derivative litigation against directors and executive officers
and may discourage or deter  stockholders  or management from suing directors or
executive officers for breaches of their duties to the Company, even though such
an  action,  if  successful,   might  otherwise  benefit  the  Company  and  its
stockholders.


                                 USE OF PROCEEDS


          The net  proceeds  which  may be  realized  by the  Company  upon  the
exercise  of all of  the  Company's  Class  A  Warrants  which  were  issued  in
connection with the Company's  initial public  offering in November 1996,  after
provision for the possible  payment of a warrant  solicitation  fee of five (5%)
percent  and  deduction  of  expenses of this  offering,  will be  approximately
$45,000.  Inasmuch  as the  Company has  received  no firm  commitments  for the
exercise of such Class A Warrants, no assurance can be given that any such Class
A Warrants will be exercised.

          Any net  proceeds  received  from the exercise of the Class A Warrants
offered  hereby are  intended  to be used for  general  corporate  purposes  and
working capital.


                                 DIVIDEND POLICY

          Other than  distributions  made prior to 1993,  when the Company was a
closely-held  "S  corporation,"  the  Company  has never  declared  or paid cash
dividends on its Common Stock.  The Company  currently  anticipates that it will
retain  all  available  funds  for use in the  operation  of its  business,  and
therefore does not  anticipate  paying any cash dividends on the Common Stock in
the foreseeable future.


                                      -22-

<PAGE>




                                 CAPITALIZATION

          The following table sets forth the capitalization of the Company as of
June 30, 1997:


                                  June 30, 1997

Preferred stock, $.0001 par value; 5,000,000 shares
         authorized; no shares to be issued and outstanding
         as adjusted  .............................................
Common stock, $.0001 par value; 4,081,676 shares
         authorized; issued and outstanding(1).....................  $      408
Additional Paid in Capital.........................................   6,941,862
Accumulated deficit................................................  (3,530,554)
                                                                     ----------

         Total stockholders' equity................................  $3,411,716
                                                                     ==========

- ------------------------
(1)  Does not  include:  (i)  1,366,050  shares of Common  Stock  issuable  upon
     exercise of the Class A Warrants included in the Units offered hereby, (ii)
     up to  375,000  shares  of  Common  Stock  issuable  upon  exercise  of the
     Over-allotment   Option   and  the   Class  A   Warrants   underlying   the
     Over-allotment  Option,  (iii) 175,000 shares of Common Stock issuable upon
     the  exercise of the  Underwriter's  Unit  Purchase  Option and the Class A
     Warrants  issuable upon the exercise  thereof,  and (iv) 610,837  shares of
     Common Stock issuable upon exercise of outstanding options and warrants and
     the  Class A  Warrants  issuable  upon  the  exercise  of  certain  of such
     warrants.  See  "Management,"  "Certain   Transactions,"   "Description  of
     Securities" and "Underwriting."



                                      -23-

<PAGE>



MARKET FOR REGISTRANT'S COMMON EQUITY AND RELATED STOCKHOLDER MATTERS

           On November 12, 1996, the Company's Common Stock and Class A Warrants
were listed for quotation on the SmallCap  Market on the Nasdaq System under the
symbols OSFT and OSFTW,  respectively.  The following table sets forth,  for the
periods  indicated  the high and low bid prices for the Common Stock and Class A
Warrants as reported  by Nasdaq.  Quotations  reflect  prices  between  dealers,
without  retail  mark-up,  mark  down or  commissions  and  may not  necessarily
represent actual transactions.


Common Stock                         High Bid                  Low Bid
1996
4th Quarter                          $5.50                     $5.25

1997
1st Quarter                          $5.75                     $5.00
2nd Quarter                          $6.375                    $5.00
3rd Quarter                          $5.50                     $4.00
4th Quarter                          $5.188                    $4.875
(through October 7 , 1997)

Class A Warrants
1996
4th Quarter                          $0.688                    $0.75

1997
1st Quarter                          $1.438                    $0.75
2nd Quarter                          $1.50                     $1.00
3rd Quarter                          $1.218                    $0.938
4th Quarter                          $1.00                     $0.938
(through October 7, 1997)


           As of October 7, 1997, the Company believes that there were in excess
of 300  shareholders  both of record and  beneficial,  of the  Company's  Common
Stock.


                                      -24-

<PAGE>



                             SELECTED FINANCIAL DATA

           The selected  financial  data set forth below as at December 31, 1996
and for each of the two  fiscal  years then  ended  have been  derived  from the
audited  financial  statements of the Company.  The financial  statements of the
Company as at  December  31,  1996,  and for each of the two  fiscal  years then
ended,  including the notes thereto, and the related report of Richard A. Eisner
& Company, LLP, independent auditors, are included elsewhere in this Prospectus.
The selected  financial data set forth below should be read in conjunction  with
"Management's  Discussion  and  Analysis of Financial  Condition  and Results of
Operations"  and the  financial  statements  of the Company  and  related  notes
thereto included  elsewhere in this  Prospectus.  Data for the six month periods
ended June 30, 1997 and 1996 are derived from unaudited  statements,  but in the
opinion of management include all adjustments  necessary for a fair presentation
of the data.  Results  for the six month  period  ended June 30, 1997 may not be
indicative of results expected for the year ending December 31, 1997.

<TABLE>
<CAPTION>
                                          Six Months Ended June 30,      Year Ended December 31,
                                          -------------------------      -----------------------
STATEMENT OF OPERATIONS DATA:                 1997           1996           1996           1995
                                          -----------    -----------    -----------    -----------
<S>                                       <C>            <C>            <C>            <C>        
Revenues:
     Consulting                           $   109,401    $   258,000    $   269,401    $   447,976
     Development and Training                    --           37,954         21,279        118,618
     Rental Income                            180,540        150,450
Net loss                                   (1,380,404)      (300,722)    (1,240,695)      (122,400)
Net loss applicable to common stock        (1,380,404)      (316,535)    (1,272,746)      (141,525)
Net loss per share of common stock              (0.34)         (0.11)         (0.45)         (0.05)
Weighted average number of common stock     4,050,952      2,800,734      2,848,943      2,797,134
outstanding



BALANCE SHEET DATA:                        June 30, 1997             December 31, 1996
                                           -------------             -----------------
Working capital                            $  2,747,686                 $  4,011,015
Total assets                                  3,703,883                    4,982,161
Accumulated deficit                          (3,530,554)                  (2,150,150)
Total stockholders' equity                    3,411,716                    4,729,120
</TABLE>

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




                                      -25-

<PAGE>



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

           The following  discussion  of the financial  condition and results of
operations  of the  Company  should be read in  conjunction  with the  Financial
Statements and the notes thereto included elsewhere in this Prospectus.


SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS

           A  number   of   statements   contained   in  this   Prospectus   are
forward-looking   statements  within  the  meaning  of  the  Private  Securities
Litigation  Reform Act of 1995 that involve risks and  uncertainties  that could
cause actual results to differ materially from those expressed or implied in the
applicable statements. These risks and uncertainties include but are not limited
to: limited operating history;  recent  establishment of new business divisions;
potential future operating  losses;  dependence on new untested  product;  risks
related  to  technological  factors;   potential   manufacturing   difficulties;
dependence on certain third parties and on the Internet;  limited customer base;
risk of  manufacturing  activities;  dependence on key personnel and proprietary
technology;  risk  of  system  failure,  security  risks  and  liability  risks;
uncertainty  of  additional  financing;  the  Company's  vulnerability  to rapid
industry  change  and  technological  obsolescence;  the  limited  nature of its
product life and the uncertainty of market acceptance of the Company's products;
the unproven  status of the  Company's  products in widespread  commercial  use,
including the risks that the Company's  current and future  products may contain
errors that would be difficult  and costly to detect and correct;  uncertainties
with respect to the Company's  business strategy;  general economic  conditions,
and other risks described in this Prospectus. See "Risk Factors."


OVERVIEW

           The Company  currently  provides  information  and  services  through
IPATs, known as  SmartStreet(TM),  that combine the advantages of local and wide
network technology. Like an intranet, the communication between the IPAT and its
servers is accomplished over private, secure lines. Like an internet, it enables
an organization to interact with the general public,  not just its own employees
and  customers.  Generally,  the  IPATS  have  been  installed  in high  density
pedestrian  traffic areas. The Company  anticipates that revenues from the IPATs
will be provided by leasing fees paid by advertisers  and service  providers and
by usage fees paid by consumers who obtain services through the IPATs.


RESULTS OF OPERATIONS

Year Ended December 31, 1996 Compared to Year Ended December 31, 1995

           Net revenues  decreased  $125,464 or 22.1% to $441,130 for the fiscal
year ended  December  31, 1996 over net revenues of $566,594 for the fiscal year
ended  December 31, 1995.  Consulting  revenues  decreased by $178,575 or 39.8%.
Training  revenue  decreased  from  $118,618  to $21,279 or 82%.  Rental  income
increased from $0 to $150,450. The Company's decreased revenues from consulting,
training  and custom  development  services  resulted  from  redirection  of the
Company resources to transactional fee-based products and services.

           The Company  continues to devote its  resources  toward the growth in
transactional  fee-based products and services utilizing intranet technology and
believes this trend will  continue in the future.  Kiosk-based  rental  revenues
represented   approximately   34.1%  of  1996  net  revenues  and  kiosk-related
consulting,  training and custom development represented  approximately $145,000
or 38.8% of 1996 net revenues.

           Costs and expenses for the year ended  December 31, 1996 increased to
$1,681,825  from  $688,994 in 1995.  This increase is a result of an increase in
expensed  development  costs for the  SmartStreet(TM)  operations  and financing
expenses.


                                      -26-

<PAGE>



           Costs of services for the year ended  December  31, 1996  declined to
$424,336 from  $429,604 in 1995.  This decline is a result of expenses for costs
relating to the New York City contract which management  expects to use in other
SmartStreet(TM) applications.

           General and  administrative  expenses as a percentage of net revenues
were 189.3% in 1996 as compared with 34.1% in 1995. Such increase is principally
attributable to startup costs for the Company's SmartStreet(TM) program.

           Interest expense  increased to $329,836 in fiscal year ended December
31, 1996 from  $3,502 for the fiscal year ended  December  31,  1995,  primarily
reflecting the amortization of discount and interest on the $1,250,000 loan. See
"Financial  Condition,  Liquidity and Capital  Resources" and Note D of Notes to
Financial Statements.

           Net  loss  increased  by  $1,118,295  or  913.6%  to a  net  loss  of
$1,240,695 for the fiscal year ended December 31, 1996 over net loss of $122,400
for the fiscal year ended  December  31, 1995.  The increase in losses  occurred
primarily because of financing costs and startup costs relating to the Company's
SmartStreet kiosk program.

           At December  31,  1996,  the Company had federal net  operating  loss
carryforwards  of  approximately  $2,200,000.  A  valuation  allowance  has been
recorded  for the  entire  deferred  tax  asset  as a  result  of  uncertainties
regarding the  realization  of the asset due to the lack of earnings  history of
the Company. See Note A[3] of Notes to Financial Statements.

Three Months and Six Months ended June 30, 1997, Compared with Three Months
and Six Months ended June 30, 1996

           The results of operations  for the six months ended June 30, 1997 are
not  necessarily  indicative  of the results  that may be expected for any other
interim period or for the fiscal year ending December 31, 1997.

           Net revenue for the three months ended June 30, 1997 increased by 11%
over the three  months ended June 30, 1996 (from  $180,625 to $200,688)  and net
revenue  for the six months  ended June 30, 1997  increased  by 27% over the six
months  ended June 30,  1996 (from  $295,954 to  $374,613).  Revenue for the six
months  increased  due to  interest  and  dividend  income  earned on short term
investments and revenue received from the New York Kiosk Demonstration  Program.
This was offset by a reduction in consulting and training revenue as the Company
continued  its  shift  away  from  fee-based  consulting,  training  and  custom
development  activities and redirected its resources  towards the development of
transactional,   fee-based  and  advertising-supported  products  and  services.
Revenue changes were not a result of increases or decreases in prices.

           Costs of services for the three months ended June 30, 1997  increased
by 23% over the three months ended June 30, 1996 (from $138,247 to $170,343) and
the cost of services  for the six months  ended June 30, 1997  increased by 129%
over the six months  ended June 30,  1996 (from  $173,467  to  $396,481)  due to
higher personnel expenses and kiosk expenses.

           Research and development expenses for the three months ended June 30,
1997  compared to the three months  ended June 30,  1996,  increased to $188,993
from zero,  and to  $287,608  from zero for the six months  ended June 30,  1997
compared to the six months ended June 30, 1996 due to the  expensed  development
costs for the SmartStreet(TM) operations.

           General and  administrative  expenses for the three months ended June
30, 1997  increased by 166% (from  $186,628 to  $495,883)  compared to the three
months ended June 30,  1996,  and by 175% for the six months ended June 30, 1997
compared to the six months ended June 30, 1996 (from  $332,413 to $913,960)  due
principally   to  increases  in  salaries  and   personnel   related   expenses,
professional fees and insurance for directors and officers.


                                      -27-

<PAGE>



           The  Company has also  provided  for a loss on a loan  receivable  to
InteractiVisions,  Inc.  in the  amount of  $150,000  (See below  Liquidity  and
Capital Resources).

           The net loss for the three months ended June 30, 1997 compared to the
three months ended June 30, 1996,  increased by 244% (from $234,596 to $807,779)
and by 359% for the six months  ended June 30,  1997  compared to the six months
ended June 30, 1996 (from $300,722 to $1,380,404).  This change is primarily due
to  increases  in  costs   associated  with  the  Company's  newer  emphasis  on
transactional and  advertising-supported  products and services,  an increase in
research and  development  expenses,  an increase in general and  administrative
expenses  due to higher  costs  associated  with being a public  company  and to
support the  redirection  in revenue  sources,  and a provision for loss on loan
receivable.

LIQUIDITY AND CAPITAL RESOURCES

           For the six months  ended June 30,  1997 the  Company  incurred a net
loss of  $1,380,404.  The  accumulated  deficit  increased to  $3,530,554 as the
Company  continues to incur operating  losses as expenses  exceed  revenue.  The
Company had  working  capital of  $2,747,686  as of June 30, 1997 as compared to
$4,011,015  as of  December  31,  1996,  or a decrease  of  $1,263,329.  Capital
expenditures and capitalized software amounted to $111,052.

           In November 1996, the Company completed the sale in a public offering
of  1,366,050  Units,  from which it  received  net  proceeds  of  approximately
$5,465,000.  Of  such  amount,  approximately  $1,583,000  was  applied  to  the
repayment of certain bridge loans and redemption of Preferred Stock. The Company
expects to fund the deployment of additional  SmartStreet(TM)  IPATs in New York
City and elsewhere,  and make IPAT related acquisitions,  from available working
capital  and from funds that will be derived  from  future  operating  revenues.
However,  there can be no assurance  that future  revenues  will be generated in
sufficient  amounts  or that  additional  funds  will  not be  required  for the
expansion  of  operations.  The  Company  intends  to lease  equipment  whenever
possible on acceptable terms.

           On   May  2,   1997,   the   Company   and   InteractiVisions,   Inc.
("InteractiVisions")   signed  a  letter  of  intent  which   contemplated   the
acquisition of all the outstanding stock of InteractiVisions in exchange for the
issuance of 600,000  shares of the Company's  Common  Stock,  subject to certain
adjustments.  Simultaneous with the signing of the letter of intent, the Company
loaned InteractiVisions  $250,000,  payable 60 days after the termination of the
letter of intent,  together  with  interest at the prime rate plus 3 points.  On
August 8, 1997,  the Company  terminated  the letter of intent.  The Company has
provided an allowance for loss on the loan receivable of $150,000.

           The rate of inflation was insignificant during the quarter ended June
30, 1997.  In the past,  the effects of  inflation on personnel  costs have been
offset by the Company's  ability to increase its charges for services  rendered.
The  Company  anticipates  that it will be able to continue to do so in the near
future. The Company  continually reviews its costs in relation to the pricing of
its products and services.

           The Company  anticipates  that its existing  working  capital will be
sufficient to fund its operations at least through the end of 1997.




                                      -28-

<PAGE>



                                    GLOSSARY


ALGORITHM  - A detailed  sequence  of actions to perform or to  accomplish  some
task.  The  term is named  after an  Iranian  mathematician,  Al-Khawarizmi.  An
algorithm reaches a result after a finite number of steps. The term is also used
loosely for any sequence of actions (which may or may not terminate).

ActiveX(TM) TECHNOLOGY - Microsoft's  implementation of OLE designed to run over
slow Internet links.

APPLETS - A program,  written in the Java language,  which can be distributed as
an attachment in a World-Wide  Web document and executed  either by a browser or
server that supports Java.

CLIENT/SERVER   COMPUTING  -  A  computer  system   architecture  in  which  two
independent  processors  communicate via an established protocol.  The client is
typically a single  user  personal  computer  with a  graphical  user  interface
operated by the end-user that makes requests to the server. The server typically
runs  database  software,  maintains  information  and  responds  to one or more
clients.

FIREWALL - A system that  controls the flow of data between an internal  network
and the Internet or between internal network segments.

FRAME RELAY - A wide area  communications  interface.  Frame Relay could connect
dedicated  lines  and  X.25  to  ATM,  SMDS,   BISDN  and  other  "fast  packet"
technologies.  Frame Relay uses the same basic framing and Frame Check  Sequence
at layer 2 so current X.25 hardware  still works.  It adds  addressing (a 10 bit
Datalink  Connection  Identifier  (DLCI))  and a few  control  bits but does not
include retransmissions,  link establishment,  windows or error recovery. It has
none  of  X.25's  layer  3  (session  layer)  but  adds  some  simple  interface
management. Any layer three protocol can be used inside the layer two Frames.

GRAPHIC  USER  INTERFACE  (GUI) -  Interfacing  with a computer by  manipulating
graphical  icons and windows  (usually by pointing and clicking a mouse)  rather
than using text commands.

HYPERTEXT  MARKUP LANGUAGE (HTML) - A page  description  language used to convey
both content and formatting information about content to a Web browser.

INTEROPERABILITY  - The ability of software  and  hardware on multiple  machines
from multiple vendors to communicate.

INTERNET - An open global network of interconnected commercial,  educational and
governmental computer networks that utilize a common communications protocol.

INTERNET  SERVICE  PROVIDER - (ISP) A company which provides other  companies or
individuals with
access to, or presence  on, the  Internet.  Most ISPs are also  Internet  Access
Providers;  extra services include help with design, creation and administration
of World-Wide Websites, training, and administration of Intranets.

INTERNET  PROTOCOL (IP) - The network layer for the TCP/IP protocol suite widely
used on Ethernet  networks,  defined in STD 5, RFC 791. IP is a  connectionless,
best-effort packet switching protocol. It provides packet routing, fragmentation
and re-assembly through the Datalink layer.

INTRANET - An  organization's  private  network of its local area  networks that
utilizes Internet data formats and communications protocols and that may use the
Internet's facilities as the backbone for network communications.

LOCAL AREA NETWORK (LAN) - A group of one or more computers  connected  together
within a localized  environment  for the purpose of sharing  data and  networked
resources such as printers, modems or servers.



                                      -29-

<PAGE>



MICROSOFT  WINDOWS  -  Computer  operating  systems  providing   graphical  user
interfaces  and,  in the case of  Windows  NT,  that is  optimized  for use as a
network server.

OLE - Microsoft's component  architecture which competes with OpenDoc and CORBA.
See "Business - Industry Background - Reusable Software Components."

PRIME NUMBERS - numbers divisible only by themselves and one (1).

RAPID  APPLICATION  DEVELOPMENT  (RAD) - a  technique  for  developing  software
quickly that makes use of prototyping and reusable software components.

SHRINK WRAP LICENSE - A printed  agreement  included in product  packaging  that
typically  provides that opening the package  indicates the user's acceptance of
its terms and conditions.

UNIVERSAL  RESOURCE  LOCATOR  (URL) - a complete  address to reach a site on the
World-Wide Web specifying the protocol and fully qualified address.

WEB BROWSER - Client programs that allow users to browse the Web.

WEB SERVER - A server process  running at a website which sends out web pages in
response to requests from remote browsers. If one site runs more than one server
they must use different port numbers.

WEBSITE - Any computer on the Internet  running a World-Wide Web server process.
A particular website is identified by the hostname part of a URL.

WIDE  AREA  NETWORK  (WAN)  -A  communications   network  that  uses  commercial
transmission resources to connect geographically dispersed users or LANs.

WORLD-WIDE WEB (Web or WWW) - A network of computer  servers that uses a special
communications  protocol to link  different  servers  throughout  the  Internet,
allowing a user to move from document to related document, no matter where it is
stored on the Internet, and permits communication of graphics, video and sound.



                                      -30-

<PAGE>



                                    BUSINESS


GENERAL

           The Company  currently  provides  information  and  services  through
IPATs, known as  SmartStreet(TM),  that combine the advantages of local and wide
network technology. Like an intranet, the communication between the IPAT and its
servers is accomplished over private, secure lines. Like an internet, it enables
an organization to interact with the general public,  not just its own employees
and  customers.  Generally,  the  IPATS  have  been  installed  in high  density
pedestrian  traffic areas. The Company  anticipates that revenues from the IPATs
will be provided by leasing fees paid by advertisers  and service  providers and
by usage fees paid by consumers who obtain services through the IPATs.

           Prior  to 1996,  the  Company's  activities  consisted  primarily  of
consulting,  writing,  training  and custom  software  development  for  various
corporate and government  clients,  including  Microsoft,  for which it produced
technical  papers and provided  consulting  services.  In  performance  of these
activities,  the Company developed skills in rapid application development and a
base of courseware and reusable  software  objects to which it retains title. In
1995,  the Company  decided to direct  these  skills and its  expanding  body of
reusable  software  objects toward the development of services  through which it
can derive  revenue on a "per  transaction"  basis.  It initially  developed and
operated  OLEBroker(TM),  an  Internet-based  subscription  service  that allows
customers to search its database of information about software objects, find the
information  needed  and at  the  customer's  option,  purchase  needed  objects
on-line.  The Company  discontinued active marketing of OLEBroker(TM) at the end
of 1996 in order to  concentrate on its IPAT- and  Internet-related  businesses.
However,  in  connection  with the  development  of  OLEBroker(TM),  the Company
developed  significant  additional  software objects,  which it then used in the
development of technology for the IPAT and Internet service  delivery  programs.
The Company  anticipates that the IPAT and Internet  service  delivery  programs
will constitute the most  significant  part of its business.  It may continue to
engage in consulting  activities as resources  permit.  In selecting  consulting
opportunities,  the Company will focus  primarily on  assignments  in connection
with the sale of IPAT services or that can otherwise enhance its skill base.


INDUSTRY BACKGROUND

INTERNET DEVELOPMENT

           In recent years,  computers have become  increasingly  interconnected
through local area networks,  wide area  networks,  and a technology for linking
computers  together  known as the  Internet  Protocol  (IP),  as well as through
various  proprietary  services.  Increasingly,  desktop personal computers (PCS)
communicate  with  larger,   shared  servers  using  an  arrangement   known  as
client/server technology, as well as with other PCS on a peer to peer basis. The
Internet,  in particular,  has experienced explosive growth in recent years as a
means for computers to communicate with each other.  While in its initial years,
the Internet was used primarily for the  transmission of electronic mail and for
the dissemination of information,  a technology called the World Wide Web ("WWW"
or "Web"), a graphical approach to seeking and providing information, has proven
to be very  popular,  and more than  40,000  websites  operate  to  support  Web
browsers.

           Recently, CommerceNet,  through Nielsen Media Research, conducted the
Internet   Demographics   Survey,   which  the   companies   say  is  the  first
population-projectable  survey  regarding  Internet  usage.  Among the  survey's
findings were these: there is a sizable base of Internet  users--some 24 million
people--in  the  United  States  and  Canada;  users of the  World  Wide Web are
potentially  ideal  targets  for  business  applications  since  they were found
typically to be more  educated  and to have higher  incomes than the rest of the
population;  and some 2.5 million people have already made  purchases  using the
Web. The study found that users access the Internet fairly frequently,  with 31%
accessing it at least once a day. In addition,  Internet  users spend an average
of five hours and 28 minutes  online per week.  The  CommerceNet  study has been
criticized by some as unrepresentative, in


                                      -31-

<PAGE>



that  it  over-represents   highly  educated  individuals  and  under-represents
individuals  with  less  than a high  school  education.  However,  the  critics
generally   acknowledge  that  even  if  the  sample  is  skewed,   the  overall
conclusions, if not their magnitude, are valid.

           Leading  developers of Web browser  software include  Netscape,  NCSA
Mosaic and  Microsoft.  Leading  developers of software for web servers  include
Netscape, O'Reilly and Purveyor. In 1996, Microsoft released an Internet server,
called Internet  Information  Server,  that it subsequently  included as part of
Release 4.0 of its NT operating system package.

           Internet  technology  has been  enhanced  in  various  ways to permit
conventional  applications  to interact  with users having access to an Internet
connection and a web browser,  to effect purchases and other  transactions  over
the Internet.  Such commercial use typically  requires custom  programming,  and
special  techniques to provide for an acceptable  level of security,  given that
the  Internet  is  inherently  an insecure  network.  Visa and  MasterCard  have
announced  standards to support the secure approval of credit card  transactions
over the Internet.  These  standards were  developed  jointly with Microsoft and
Netscape.  Separately,  Netscape and VeriFone  Inc.  announced  plans to develop
software to support this  standard with  Netscape's  commerce  server  software.
DigiCash,  N.A.,  CyberCash,  Inc., and First Virtual  Holdings have implemented
their own Internet payment  systems.  The ability to accept payments easily over
the Internet opens up many possibilities;  for example,  users can pay on a "per
transaction" basis for use of specialized software or for obtaining  information
such as documents, price quotations, and the like.

           Many vendors, including Microsoft, offer techniques for improving the
level  of  security  on  the  Internet,  including  secure  servers,  firewalls,
encryption techniques and other devices;  however, even in the aggregate,  these
techniques are not wholly foolproof and the lack of full security may impede the
growth of commerce on the  Internet.  New studies using very large Prime Numbers
propose to have keys that all the computing  power in the world today would take
over a million years to break.  Although this may be drastically  reduced by new
techniques in factoring  Prime Numbers,  finding a pattern to Prime Numbers,  or
future  computer  power growing much more than  expected,  these new  techniques
would offer far greater security than any codes in use today.

           In the past  year,  reusable  software  components  have  begun to be
adapted for the Internet.  Two strategies have emerged.  The first is a language
called  Java  created  by Sun  Microsystems  for  development  of  "applets"  of
downloadable and reusable software components over the Internet.  More recently,
Microsoft has developed software to support its ActiveX(TM)  technology over the
Internet,  and has released a beta  version of Visual Basic called  Visual Basic
Script for the  development  and  support  of  ActiveX(TM)  components  over the
Internet.  Microsoft  has also signed an agreement  with Sun for support of Java
applets in its Internet Explorer, an Internet Browser used by the Company.


INTRANET TECHNOLOGY

           Internet  software is being used in private networks also. Such usage
is  referred  to as an Intranet  and it is  increasingly  becoming a part of the
information  services  delivery  strategy  of many  large  organizations.  Using
Internet  software  to  organize a private  network can provide the same ease of
use,  hypertext  capabilities,  and  downloading  as does  the  Internet  today.
Intranets can be used to support a broad range of business  solutions;  that is,
software  programs that support  business  functions.  Drawing from the usage of
Internet  e-mail and the  Internet's  World-Wide  Web,  Intranets can be used to
publish and exchange information within a company.

           Additionally,  Intranets  can be used to  make  interactive  business
applications  broadly accessible to a company's users wherever they are located.
This is not just the  traditional  automating  of  business  processes  within a
company.  These  applications can also tie together  business  processes between
companies.  An example of this would be linking  suppliers with a  manufacturing
company's inventory system.  This inter-company  communication can take place by
combining Intranets and the Internet.  A new capability,  called  point-to-point
tunneling  protocol (PPTP),  makes it feasible for secure business  processes to
operate over the Internet. In this


                                      -32-

<PAGE>



connection,  according to Microsoft,  over 1.2 million  people use the Microsoft
Office family of web authoring tools.


IPAT TECHNOLOGY

           IPATs are  public  access  stations  that can supply  information  or
perform  transactions.  They are becoming more and more common across the United
States  and  include  such   applications  as  custom  greeting  card  machines,
automotive parts look-up centers, music CD-preview stations,  museum information
IPATs, and movie ticketing dispensers.

            Many  IPATs  today  are  self-contained.  Others  may be linked to a
central  site.  IPATs  have   traditionally  used  conventional  or  proprietary
technology.  In contrast,  the Company's IPAT technology combines the advantages
of Internet and Intranet technology.


REUSABLE SOFTWARE COMPONENTS

           Historically,  the Company engaged in rapid  application  development
for others.  It was  attracted  to this field  because,  as noted by  Microsoft,
software  development in many companies today accounts for half or more of total
expenditure for information processing. Often, software development takes longer
than expected to complete, and fails to live up to expectations.  In "Software's
Chronic  Crisis,"  W. Wayt  Gibbs  reports  that over half of  complex  software
projects fail (Scientific American,  September 1994). Although U.S. corporations
and  institutions  spend an annual  $250  billion on software  development,  the
Standish  Group  International  reports  that  only 16% of  projects  come in on
budget, on time, with all the planned features.  Fifty-three  percent are either
over budget,  delayed,  have fewer  functions than planned,  or any  combination
thereof (Investor's  Business Daily,  January 25, 1995). Several techniques have
been developed to remedy this situation, including a trend towards client/server
computing,  the  use of  graphical  user  interfaces,  such  as  Windows,  rapid
application  development  languages  and  environments  such  as  Visual  Basic,
PowerBuilder  and Delphi and  SQLWindows,  and the development of techniques for
reuse of software components such as OLE and OpenDoc.

           Reusable  software  has been a goal of software  developers  for many
years, as a means of reducing the cost and time frames for software development.
Programming  languages  that  are  "object-oriented"   provide  facilities  that
encourage  development  of reusable  blocks of software  called  "objects."  The
leading languages which support object  development are C++ and Smalltalk.  Such
objects can be reused  only in their own  environments,  and modest  success has
been reported using such tools. More recently,  the software community has begun
to   develop    mechanisms    for   larger   reuse    through    language-   and
platform-independent reusable software components. The goal of reusable software
components is to provide a mechanism  for reusing  tested  objects,  without the
necessity for the programmer reusing the code to need to understand the internal
algorithms or structures of the code being reused. This reuse is accomplished by
establishing a "contract" or agreed-upon mechanism for objects to interoperate.

           Currently,  the leading technology for reusable  components is called
Object Linking and Embedding (OLE), now known as ActiveX(TM),  and was developed
by Microsoft.  It is supported by over 300 independent  software  vendors (ISVs)
who have  developed  several  thousand  reusable  objects  that are  offered for
commercial  sale. Many  organizations  also develop their own reusable  software
components  that they do not market to others.  OLE is a  proprietary  Microsoft
standard,  but it is an open  standard  in the sense  that it is  published  and
anyone can build components  conforming to this standard without payment of fees
to Microsoft and without obtaining a license. Microsoft has recently taken steps
to establish an independent standard-making body for ActiveX(TM) technology.

           A  competing  standard,  developed  by IBM and  Apple  and  known  as
OpenDoc,  was  contributed to Component  Integration  Laboratories  (CILabs),  a
non-profit industry-wide organization and is offered as an


                                      -33-

<PAGE>



"open"  cross-platform  standard  (that is, it can be used with  computers  with
different operating  systems).  Initial supporters of CILabs include Apple, IBM,
Novell,  Oracle, SunSoft and Xerox. Microsoft has not endorsed this standard. To
date,  few  components  have been  developed  to support  OpenDoc.  Once OpenDoc
becomes available for the Windows platform, an effort which IBM has announced is
underway, additional vendors may be motivated to develop for this specification.

           OLE is available for the Windows  platforms  and the Apple  Macintosh
line of computers with support provided by Microsoft.  IBM, Microsoft,  Computer
Associates,  Wang as well as  specialized  vendors such as Sheridan and Progress
among  others,  have  developed  and  offer  for sale OLE  components  for these
environments.  In  addition,  Microsoft  has  licensed  several  third  parties,
including Digital Equipment  Corporation,  Software AG, and Insignia and Bristol
Technologies  to develop  support for OLE on Digital's VMS  platform,  IBM's MVS
mainframes and AS/400 computers, and UNIX platforms, respectively. Microsoft has
estimated that 98% of computers will support OLE by 1998.

           A third  standard,  known as CORBA, a  specification  endorsed by the
Object  Management  Group, is designed to allow objects written on different and
otherwise  incompatible  platforms to interact  using  software  known as object
request brokers (ORBs). ORBs are offered by vendors including Digital, Orbit and
Software AG.


OBJECTSOFT STRATEGY

           The Company's  strategy is to focus on  development  and marketing of
the IPAT and Internet service delivery products. In this regard, it will seek to
enter into  strategic  alliances  with,  and provide  Intranet  and/or  Internet
software to,  entities  that have a need to provide  information  and  documents
contained in proprietary databases to, or conduct a large volume transactions of
transactions  with, the general public or specific,  but large,  audiences in an
expeditious,   widely  and  easily  accessible  manner.  Such  entities  include
municipalities,  other  government  entities  and  agencies and large public and
private entities such as publishers, trade and business associations and others.
The  Company  will  seek  to  develop   alliances  with  software  and  hardware
manufacturers  whose  products  may be used in or  integrated  with the software
being  developed and marketed by the Company.  The Company  intends to retain an
ownership  interest  in the  objects it  develops  in support of such  projects.
Wherever possible, the Company also intends to contract, as it has with the City
of New York, to own and operate the services itself.

           In addition, the Company will seek to structure its arrangements with
customers to permit it to offer related and unrelated  information and services,
particularly  to IPAT users who might not otherwise have access to the Internet.
This could include commercial and public service advertising and potentially the
ability to make purchases and conduct other transactions through the Internet.

           There  can be no  assurance  that the  Company  will be able to fully
implement  its  strategic  objectives  or that  it will be able to  successfully
market its IPAT and Internet based transaction services.


PRODUCTS AND SERVICES

SMARTSTREET(TM) IPAT SERVICES

           The Company makes transactional  services available via public access
IPATs that combine the advantages of Internet and Intranet  technology.  Like an
Intranet,  the  communication  between the IPAT and its servers is  accomplished
over private,  secure lines.  Like an Internet,  it enables an  organization  to
interact with the general public, not just its own employees and customers.  The
Company  anticipates  that  revenues  from the IPATs will be provided by leasing
fees paid by the service providers,  such as the City, and by usage fees paid by
consumers who obtain services through the IPATs.


                                      -34-

<PAGE>



           In early 1996, as part of its IPAT Demonstration Project, the City of
New York entered into the City  Agreement to develop  public IPATs to be located
in City offices and other public locations in an effort to expedite transactions
with the City. Under the City Agreement, the City agreed to lease the first five
IPATs, and the Company may deploy  additional IPATs throughout the New York City
area at its own risk and expense,  subject to City  approval of IPAT  locations.
The first five IPATs were  deployed in New York City in July 1996.  A sixth IPAT
was  installed  in  August,   1997.  All  IPATs   providing  City  services  for
information,  whether  operated  by the  Company or other  suppliers,  carry the
City's  CityAccess(TM)  logo.  Pursuant to the City  Agreement,  the Company has
developed  IPATs  through  which  members of the public can obtain access to the
records of the Department of Buildings,  certain  Department of Health services,
including copies (for a fee) of birth  certificates,  death certificates and dog
licenses,  obtaining  public health  information,  and  registering  for certain
courses  offered by the Department of Health.  Information  on City  government,
directional  information and information about New York City's events,  museums,
tourist  attractions,  shopping and similar matters is provided without fee. The
City has recently requested pricing information for extending the City Agreement
to include an  additional  12 - 35 IPATs to be installed in the third quarter of
1997. However, there can be no assurance that a contract for this extension will
ultimately be entered into.

           The  Company's  goal in designing  the  SmartStreet(TM)  IPATs was to
maximize potential use by developing software that would be inviting and easy to
use. The IPATs are designed so that a potential user is attracted to the IPAT by
digital  videos  played  from the upper  monitor.  Initially  these  videos will
include an "attract loop,"  narrated by the noted actor Tony Randall  (currently
Director of the National  Repertory Theater) and a message from Mayor Rudolph W.
Giuliani, as well as "spot"  advertisements.  The attract loop explains what can
be done with the IPATs and how to use them,  and shows people from many walks of
life using them successfully.

           The IPATs are  configured  to permit the Company to offer  additional
services provided either by the Company or third parties and to sell advertising
on such IPATs. The City Agreement requires the Company to pay to the City 50% of
advertising  and third party service  revenues from the first five IPATs and 15%
of such revenues from such additional  IPATs that carry the CityAccess logo. The
Company  plans to  exercise  these  rights and to  actively  solicit  additional
service   providers   and   advertisers.   The  Company  will  seek  to  provide
SmartStreet(TM) services to other municipalities, states and government agencies
and to  organizations  in the  private  sector  that  provide a large  volume of
information,  records and documents to the public.  The Company may also seek to
enter into agreements  with the City and other customers to provide  information
and  services  over  the  Internet,   in  order  to  significantly   expand  the
accessibility  of such  information  and services.  To date, the Company has not
entered into any agreements to offer any of the foregoing additional services or
products.

           In connection  with the  development  of the IPATs and the deployment
and operation of the first five IPATs,  the City agreed to pay to the Company an
aggregate  of  $661,080,  of which  $361,080  is  payable in the form of monthly
payments of $30,090  ($6,018  per IPAT),  which were  commenced  as of August 1,
1996,  and the  balance of  $300,000  is  payable in partial  amounts as certain
milestones  in the  development,  deployment  and  operation  of the  IPATs  are
achieved, of which $279,000 has been earned prior to September 30, 1997.

           For the first 43 weeks the  Company's  IPATs  were used an average of
2,434 times per week. In recent weeks average usage has exceeded  4,000 uses per
week.  In the most recent week for which  figures are  available,  the Company's
IPATs  averaged 805 uses per week each.  In  comparison,  IPATs of the other two
participants in the  demonstration  project  averaged 294 and 787 uses each. The
City has  indicated  that it intends to extend the  contract  through the end of
1998.

           The Company may also receive  transaction fees in connection with the
use of the IPATs by the public to obtain documents or certain other services. As
of May 31,  1997,  the first  five  IPATs were  available  only to provide  City
information  and  did  not  provide  transaction  services  or  carry  any  paid
advertising  or third  party  services.  Consequently,  no  revenues  have  been
generated  to date by user  transactions  or  advertising.  The amount of future
transaction and advertising revenues, if any, will depend on user and advertiser
acceptance of the IPATs.



                                      -35-

<PAGE>



           In August 1997,  ObjectSoft  announced the  development and immediate
availability of SmartSign(TM), a modular line of IPATs contained in an enclosure
that is only  7-1/2" in  depth,  with each  module  weighing  less than 70 lbs.,
making the units suitable for regular shipment through UPS and Federal Express.

           The modules  initially consist of (a) a Pentium class processor unit,
(b) an active-matrix touch screen, with optional sealed heavy-duty keyboard, and
optional  credit card reader,  (c) a printer unit with page printer and optional
receipt printer, (d) a light-box advertising module with optional plasma display
and (e) an optional touch-sensitive light-box.  Although a working unit has been
delivered and is operational,  there can be no assurances that there will be any
commercial sales of this line.

           As of  September  30, 1997 no revenues  have been  generated  by user
transactions  or  advertising.  The IPATs became  available  to support  on-line
inquiries into City databases as of June, 1997.

           Recently the Walt Disney Company  agreed to a trial with  advertising
of the IPAT's installed in New York.

           Pursuant to the City Agreement,  the Company has the right to install
additional  IPATs in the City, at the Company's  risk and expense and subject to
certain  conditions  including  site approval by the City.  The City will not be
required  to  pay  additional  monthly  payments  for  such  IPATs,  but  it  is
anticipated,  although  there can be no  assurance,  that use by the public will
generate  transaction fees. The Company had commenced evaluating potential sites
and will seek to install up to 25 additional IPATs over the next year. The first
of these  additional  IPAT's was installed in July 1997 in the Museum of Science
in Queens.

           At the time the City  Agreement  with the Company was  executed,  the
City also signed  similar  agreements  with two other  companies for  additional
IPATs.  The City  expects to evaluate  its success  with this program and, if it
deems it successful, to issue a Request for Proposals for competitive bidding to
supply additional IPATs throughout the City.

           The  Company  intends  to  market  IPATs  to  other   municipalities,
government  agencies and organizations in the private sector. In the future, the
Company may seek to make its transactional  services available over the Internet
and to make the Internet  available from the Company's  public IPATs.  Recently,
the  Company  was  the  successful  bidder  in  Seattle,   Washington,  for  the
installation of eight IPAT's providing information regarding ferry service.

           There can be no  assurance  that the  Company's  initial  IPATs  will
perform on a commercial  basis as anticipated,  that the Company will be able to
install and operate  additional  IPATs pursuant to the City Agreement,  that the
City will seek to acquire  additional  IPATs,  that the  Company  will  secure a
contract  to  supply  additional  IPATs to the  City,  that it will  succeed  in
marketing its IPATs to other potential users, or that it will be able to attract
additional  service providers or advertisers to IPATs that may be located in New
York City or elsewhere.


Operation of SmartStreet(TM) IPATs
- ----------------------------------

           The  Company's  goal in designing  the  SmartStreet(TM)  IPATs was to
maximize potential use by developing software that would be inviting and easy to
use. The IPATs are designed so that a potential user is attracted to the IPAT by
digital  videos  played  from the upper  monitor.  Initially  these  videos will
include an "attract loop,"  narrated by the noted actor Tony Randall  (currently
Director of the National  Repertory Theater) and a message from Mayor Rudolph W.
Giuliani, as well as "spot"  advertisements.  The attract loop explains what can
be done with the IPATs and how to use them,  and shows people from many walks of
life using them successfully.



                                      -36-

<PAGE>




           Once a user  approaches  the IPAT, he or she is greeted by a message,
and invited to press on the touchscreen to continue.  In the future, the Company
expects to make the IPATs accessible in multiple  languages.  The user is guided
with verbal and  on-screen  prompts to the various  services and  categories  of
information available from the IPAT. As currently configured, the Opening Screen
is divided into five parts or frames (see Figure 1 below):

1.   Multimedia  Frame - The upper left corner  presents  graphics,  pictures of
     people  or  places,   and  "talking   heads"  to  help  the  user  navigate
     SmartStreet(TM).
2.   Toolbar Frame - SmartStreet(TM)  navigation  buttons are located just below
     the Multimedia Frame.  These buttons are always visible and allow the user,
     at any time,  to: a) Return to Home Menu b) Take a survey c) Get  on-screen
     help in using the IPAT
3.   Content Frame - Located to the right of the Multimedia and Toolbar  Frames,
     this  contains  the  content  and  menus of the  information  and  services
     available on SmartStreet(TM).
4.   Footer  Frame - Located  below the  Toolbar  Frame and most of the  Content
     Frame,  this  contains a place for local  advertising  and the keyboard for
     data input when needed.
5.   Volume  Frame - Located to the right of the Footer  Frame and  beneath  the
     Content  Frame,  this controls the IPAT volume.  When a user walks away and
     the  IPAT  resets  itself  (after  about  two  minutes  of idle  time),  it
     automatically resets the volume to 5 (mid position).  A small feedback area
     confirms the current setting for the user.




                               [GRAPHIC OMITTED]



SmartStreet(TM) IPAT - Opening Screen


                                      -37-

<PAGE>



           The user has  several  choices  on the  Opening  Screen  to begin the
SmartStreet(TM) experience. The user can:

1.   Touch the Touch Here to Begin link in the Content Frame, the Home button in
     the Toolbar Frame,  or the graphic in the Content Frame to jump to the Home
     Menu (see Figure 2 below).

2.   Touch I'm Finished to take a short survey on his or her  experience  on the
     IPAT or leave a message. 3. Touch I Need Help to get online verbal or video
     help on

     a)   What is available on the IPAT;
     b)   How to use the IPAT.



                               [GRAPHIC OMITTED]


SmartStreet(TM) IPAT - Home Menu


           The Home Menu contains the starting point for each service  available
through SmartStreet(TM). The current services are:

1.   Keys To City Hall - This  service  allows a user to look up city  agencies,
     elected officials and city transportation (see below).
2.   Around New York City - This service  provides  information on New York City
     attractions,  tours, hospitals, churches, museums, theaters, sports arenas,
     etc. Most of the items in this section include maps of the attraction.
3.   Department of Health ("DOH") - DOH services and  publications are listed as
     well as the ability to print  applications  for Birth  Certificates,  Death
     Certificates, and Dog Licenses.
4.   CityAccess(TM)  IPATs - Lists the location  and  services  available at all
     CityAccess(TM) IPATs.


                                      -38-

<PAGE>



5.   Department  of  Buildings   ("DOB")  -  DOB  services   include  review  of
     outstanding violations against a building, tracing of ownership records and
     review of heat complaint information.
6.   Marketing on SmartStreet(TM) - Information on how to contact the Company.
7.   Transportation - Maps and routes for subways, buses and railroads,  as well
     as street maps.


           If a user wants to carry out a transaction  for which there is a cost
(such as  obtaining a license or an official  copy of a  document),  the user is
advised of the charge and  prompted  to insert a credit  card.  The credit  card
reader in use is designed so that the user never lets go of the card,  for added
security.  The  transaction  request is sent to the  central  server site over a
secure frame-relay  network. In turn, the server sends the credit information to
a credit  authorizer for approval.  If the transaction is declined,  the user is
advised and invited to submit another card. If the  transaction  is accepted,  a
reservation is made against the user's credit line, and the server then proceeds
to initiate a transaction  with the City's  computers,  to which it is connected
via private  leased lines.  Once the required  service has been performed by the
City's  computers,  and a confirming  transaction  number sent back,  the credit
authorizer is again  contacted and the  transaction  is settled.  The authorizer
causes the user's account to be debited,  and the merchant  accounts of the City
and the  Company  to be  credited  for the  transaction  fee  and  service  fee,
respectively. The Company's credit card transaction capability became functional
in September, 1997.


SmartStreet(TM) IPAT Technology
- -------------------------------

           SmartStreet(TM)   IPATs  were  designed   using   advanced   Internet
technology.  This  technology  allows the IPATs to  operate  either on a private
Intranet  or as an  Internet  site.  The  "browser"  in the IPAT is  Microsoft's
Internet Explorer 3.0 (IE3), and the server is Microsoft's  Internet Information
Server 1.1 (IIS). By using IE 3 as an OLE object running full screen, hiding the
Windows  environment  from the user,  the  Company  was able to present a custom
interface without having to develop custom operating system software or add-ons.
The browser  operates in a fashion suitable for use by the general public from a
touch  screen.  Scroll  bars,  menus and status  areas are turned off,  and only
functions which are specifically programmed or permitted are allowed.

           IE3 allows the use of new  "light-weight"  ActiveX(TM)  controls  and
supports client-side VB Script and Java. IE3 also supports SSL 2.0, SSL 3.0, and
PCT 1.0  security  standards  as well as advanced  HTML  Features  such as Style
Sheets,  Frames & Tables,  which convey content to the user at the IPAT. Many of
these  pages  contain VB Script  code to perform  functions  beyond the scope of
normal HTML. This code uses objects,  many of which were initially  developed by
the Company in connection with consulting contracts or OLEBroker(TM), to perform
complex  tasks on behalf of the IPAT.  Some of the tasks these  objects  perform
are:

1.   Printing formatted documents
2.   Reading a credit card
3.   Printing a receipt
4.   Transmitting Credit Card information to a bank for approval/disapproval
5.   Logging and error handling
6.   Storing the survey results into a database
7.   Adjustment of volume
8.   Production of custom maps (in the future)

           In  addition,  many third party  ActiveX(TM)  controls are or will be
used, including:

1.   ESRI's Map Objects (Custom Maps)
2.   Wall Data's Rumba (mainframe connections)
3.   Microsoft's custom controls and timers (Look and feel of the IPAT)
4.   Microsoft Visual Basic's buttons (keyboards)



                                      -39-

<PAGE>



           The  Server  is  built on  Windows  NT and  runs  Microsoft  Internet
Information Server,  which supports  "server-side" Visual Basic, and ActiveX(TM)
controls.  Microsoft  BackOffice  is also used for the  databases and for system
management.  The connection  between the remote IPATs (each of which is operated
as  a  separate  LAN)  and  the  Server  is  accomplished  through  Frame  Relay
connections, and uses equipment manufactured by RAD and by Cisco. The connection
is transmitted via regulated common carriers.

           The IPATs were designed to comply with the accessibility requirements
of the Americans with Disabilities Act. The Company used  subcontractors for the
design  hardware  and  graphics  associated  with its  IPATs,  and the IPATs are
constructed by a subcontractor in accordance with the  specifications  developed
by  the  Company.  They  are  constructed  of  hardened  steel,  with  baked-on,
vandal-resistant  paint.  The  touchscreen  in use is made of tempered glass for
secure and vandal-resistant operation.


Marketing
- ---------

           The  objective of the  Company's  marketing  efforts is to obtain the
rights to place its IPATs in compelling high-density locations. In addition, the
company seeks to attract  advertisers  based on the number and  demographics  of
"impressions"  that the  Company  can offer to  advertisers.  To this  end,  the
Company has commissioned  site surveys that count that actual population at each
existing  location.  The Company has retained a consultant to assist the Company
in leasing space in favorable  locations and on satisfactory terms. In addition,
the Company has retained a media consultant to prepare a media kit and to target
it to  suitable  advertisers.  The  Company  has  retained  a  public  relations
consultant  to  disseminate  news related to its IPATs and to stimulate  demand.
Additional  marketing  efforts  focus  on  identifying  content-providers  whose
offerings can create additional  transaction revenue for the Company's IPATs. In
seeking  content-providers,  the Company will exhibit at major trade shows where
it will  partner  with several of its major  vendors.  For example,  the Company
partnered with Dell and Microsoft at the Government  Technology  trade show held
in Albany,  New York in September 1996, and it expects to participate in similar
joint efforts on an ongoing basis. A telemarketing program has been initiated to
target tourist,  recreational and similar facilities to list their facilities on
the Company's IPATs. This effort will be contracted to a telemarketing firm on a
commission basis.

           The Company's  marketing  activities  are currently  performed by its
executive  officers and consultants under such officers'  supervision.  In March
1997, the Company  engaged June R. Petroff as Senior Vice President of Sales and
Marketing.  Ms.  Petroff  was  formerly  employed  as  Vice  President-Corporate
Marketing for Gateway Outdoor  Advertising,  and has  significant  experience in
non-traditional media.


OLEBROKER(TM)


           The  Company's  first   commercial   product  for  the  Internet  was
OLEBroker(TM), introduced in November 1995. OLEBroker is an on-line subscription
service for OLE  reusable  components.  This service is operated on the Internet
with the  Universal  Resource  Locator  (URL) of  http://www.olebroker.com.  The
service  contains  the  searchable  full  text  of the  help  files  of OLE  and
ActiveX(TM) components that have been provided for listing by component vendors.
In addition,  it contains  white  papers,  specifications,  standards,  training
materials,  and news articles.  OLEBroker(TM) is designed to be a one stop place
to get  information  on OLE, as well as to find  component  needs for particular
purposes.  The Company discontinued active marketing of OLEBroker(TM) at the end
of 1996 in order to concentrate on its IPAT - and  Internet-related  businesses.
However,  in  connection  with the  development  of  OLEBroker(TM),  the Company
developed  significant  additional  software objects,  which it then used in the
development of technology for the IPAT and Internet service delivery programs.




                                      -40-

<PAGE>



CONSULTING, TRAINING AND AUTHORING SERVICES

           The  Company's  historical  business  has been to assist  clients  in
making the transition from mainframes and  minicomputers  to  client/server  and
rapid application development.  These services have included training, authoring
and  consulting for numerous  clients in a variety of industries,  including the
insurance,  manufacturing and fashion industries,  as well as the public sector.
The  Company  intends to  continue to engage in these  activities  as  resources
permit.  In  selecting  opportunities,  the  Company  will  focus  primarily  on
consulting and training assignments in connection with the sale of IPAT services
or that can otherwise enhance its skill base.


Training Services

           The Company has provided training courses in subjects including:

                o     Client/Server Rapid Application Development

                o     Graphical User Interface Design

                o     Internet Development

                o     Automated Testing of Software

                o     Introductory and Advanced Visual Basic

                o     Component Development with OLE 2.0

                o     Help Authoring and Software Documentation

           Training fees are typically  charged on the basis of per-diem fees of
$2,000 - $3,000 per day and a materials cost, if applicable,  plus reimbursement
for out-of-pocket expenses. Most seminars are held at client sites.


Authoring Services

           David E. Y. Sarna and George J. Febish,  Co-Chief  Executive Officers
of the Company,  author a monthly column,  called  Paradigm  Shift,  focusing on
development,  Internet and Intranet  issues,  for Datamation,  a magazine with a
circulation of approximately  225,000 published by Cahners Publishing Company, a
division of Reed Elsevier Inc. In addition, the Company has authored three white
papers for Microsoft  covering OLE,  Three-tier  Client/Server  Architecture and
Visual Basic for Enterprise  Development,  and completed various assignments for
other clients. Fees from these services are negotiated on a project basis.


Custom Development and Consulting Services

           Custom Development and Consulting  Services include the design of OLE
objects,  as well as complete  multimedia  systems.  Fees for such  services are
negotiated either on the basis of hourly billing rates for the staff assigned or
for fixed fees for specified services.

           The Company entered into a contract in 1995 with ACORD Corporation, a
non-profit  organization,  whose members include property and casualty  insurers
and about 40,000  independent  agents  ("ACORD").  ACORD  develops and maintains
communications  standards  for the property and casualty  industry.  The Company
assisted  ACORD in defining  AL4, an  OLE-based  standard and set of objects for
implementing


                                      -41-

<PAGE>



ACORD  forms,  which  comply  with  184  standards  set  by  various  regulatory
organizations.   Developers   from  ACORD  and  the  Company  are  creating  and
distributing  the reusable  ACORD  knowledge  objects for  particular  insurance
forms. The standard also describes how ACORD's  Independent  Software Developers
(ISDs) can incorporate these OLE-based  objects into their systems.  The Company
intends to work with ISDs to assist them in implementing  support for AL4 on the
basis of consulting agreements.


RELATIONSHIP WITH MICROSOFT

           The Company has established a strategic  relationship  with Microsoft
that it believes is important to its sales, marketing and support activities, as
well as to its product  development  efforts  relating  to its IPATs.  Microsoft
supports the Company in marketing its public access services, and has informally
agreed to exhibit the  Company's  IPATs in Microsoft  displays at various  trade
shows. It has also issued statements that included favorable references relating
to  the   Company's   products.   Microsoft   has  also   entered  into  various
non-disclosure agreements with the Company with respect to unannounced Microsoft
products,  under which the Company has the opportunity to have advance knowledge
of  software  technology  being  developed  by  Microsoft.  Microsoft  has  also
provided, and continues to provide, fee-based consulting services to the Company
through  Microsoft  Consulting.  Since  1994,  the  Company  has  served  as the
exclusive  regional  host and sponsor of Microsoft  Developer  Days,  an ongoing
series of technical  conferences  organized and operated by Microsoft.  The most
recent  conference  was held on March 19, 1997.  The  conference  attracted over
5,000  paid  registrants  and was  completely  sold out.  The  Company  has also
produced technical papers for, and provided  consulting  services to, Microsoft.
The next conference is expected to be held in February 1998.


COMPETITION

           The Company is subject to competition from different  sources for its
different services.  The Company's intranet IPAT business competes with numerous
companies,   including  IBM,  North  Communications,   Golden  Screens  and  NCR
(currently a division of AT&T). The City has also awarded contracts,  comparable
to the contract awarded to the Company, to North  Communications and DSSI (which
awarded a subcontract to Golden Screens),  both of which have sold similar IPATs
to other municipalities. After fulfillment of the initial contracts, if the City
chooses to install  additional  IPATs  throughout  the City of New York,  it may
award to others,  and not the Company,  the contract to install such  additional
IPATs.  Further,  there can be no assurance that other  municipalities  or other
entities will seek to acquire IPATs from the Company. In addition, if the use of
IPATs  provided by the Company and others  proves to be  successful  in New York
City  and  other  municipalities  and  locations,  additional  companies  in the
software, hardware and communications areas, among others, may seek to enter the
market.  Many of such  competitors  may  have  resources  far  greater  than the
Company. A total of 19 companies competed for the contracts with the City of New
York, many of which can be expected to compete aggressively in other competitive
situations.


CUSTOMERS

           The  customer   base  for  the  Company's   IPAT  business   consists
principally of municipalities and other public sector or commercial  entities to
which  the  Company  would  sell or lease  IPATs,  prospective  advertisers  and
ultimately  consumers  accessing  IPAT  services or  products.  The Company also
intends to market its consulting services to mall operators.

           The Company  historically  has derived a  significant  portion of its
revenues from a relatively  limited  number of customers.  During the six months
ended June 30, 1997,  the City of New York  accounted  for 73% of the  Company's
revenues pursuant to the City Agreement. During the twelve months ended December
31, 1996, two customers, the City of New York and Microsoft accounted for 71% of
the Company's  revenues.  During 1995, two customers accounted for approximately
48% of the Company's revenues.


                                      -42-

<PAGE>



PROPRIETARY RIGHTS

           The  Company's   success  is  highly  dependent  on  its  proprietary
technology.  The  Company  views its  software as  proprietary,  and relies on a
combination  of trade  secret,  copyright  and  trademark  laws,  non-disclosure
agreements and  contractual  provisions to establish and protect its proprietary
rights.  The  Company  has no  patents or  patents  pending  and has not to date
registered  any of its  trademarks  or  copyrights.  The  Company  plans to seek
registrations   in   the   United   States   for   the   following   trademarks:
SmartStreet(TM), ObjectSoft(TM), OLEBroker(TM) and CafeOLE(TM). In addition, the
Company  plans to register  certain of these  trademarks  in  principal  foreign
jurisdiction.

           The source code for the Company's  proprietary  software is protected
as a trade secret. In addition, because the Company does not sell or license its
technology to third parties,  but rather delivers services through its IPATs and
OLEBroker(TM),  its  proprietary  software is not  disclosed  to third  parties.
Furthermore, the Company enters into agreements, as appropriate, with employees,
consultants and subcontractors containing provisions relating to confidentiality
and the assignment of inventions and other  developments  to the Company.  There
can be no  assurance  that  the  steps  taken  by the  Company  to  protect  its
proprietary  rights will be adequate or that the Company's  competitors will not
independently develop technologies that are substantially equivalent or superior
to the Company's technologies or products.

           Research  and  development  expenditures  were  $287,608  for the six
months ended June 30, 1997 and $92,693 in 1996 and $62,863 in 1995. In addition,
during the years ended  December 31, 1996 and December 31, 1995, the Company has
capitalized  additional software development costs which aggregated $137,904 and
$118,478, respectively.


GOVERNMENT REGULATIONS AND LICENSING

           The Company  believes  that it has all licenses  necessary to operate
its business as currently conducted in New Jersey and New York.

           The  Company is not  currently  subject to direct  regulation  by the
Federal  Communications  Commission or any other agency,  other than regulations
applicable  to  businesses   generally  and   businesses   doing  business  with
governmental  agencies. In connection with its contract with the City and future
contracts,  if any,  with  the  City  and  other  municipalities  or  government
entities,  the  Company  will have to comply  with such  regulations,  including
bidding   procedures  and   record-keeping,   audit,   insurance,   bonding  and
anti-discrimination provisions, among others.

           Due to the  increase in Internet  use and  publicity,  it is possible
that laws and regulations may be adopted with respect to the Internet, including
with respect to privacy,  pricing and  characteristics  of products or services.
The Company cannot predict the impact,  if any, that future laws and regulations
or legal or  regulatory  changes may have on its  business.  See "Risk Factors -
Government   Regulation;   Potential   Liability  for  Information  and  Content
Disseminated through Network."


FACILITIES

           The Company occupies  approximately 4,300 square feet of office space
in  Hackensack,  New Jersey,  under a lease with an  unaffiliated  landlord that
expires on March 31, 2003 and  provides  for a base rent of $58,008 per annum in
1997, subject to certain increases in subsequent periods.




                                      -43-

<PAGE>



EMPLOYEES

           As of September 30, 1997,  the Company had 13 employees,  12 of which
were full-time,  and all of whom are based in its Hackensack,  NJ offices. These
include 6 in product development, 3 in management and sales, 2 in operations and
2 in finance and administration.

           Although the Company expects to increase its full-time staff to 17 or
more, on an "as-needed"  basis,  the Company intends to continue with its policy
to outsource  non-strategic  functions such as artwork  development,  repetitive
testing,  maintenance and bookkeeping  rather than using its own staff for these
functions.

           Other  than  Messrs.   Sarna  and  Febish,  the  Company's  executive
officers,  no other senior  personnel  have entered into  employment  agreements
obligating  them to  remain  in the  Company's  employ  for any  specific  term;
however,  substantially  all  key  employees  of  the  Company  are  parties  to
nonsolicitation, confidentiality and Noncompetition agreements with the Company.
In addition,  independent contractors enter into confidentiality agreements with
the Company.

LEGAL PROCEEDINGS

           In or about  January  1997,  the Company  commenced  an action in the
United  States  District  Court for the  District of New Jersey  against  Harvey
Bayard ("Bayard"), a former stockholder, officer and director of the Company. In
its complaint,  the Company alleges,  among other things, that Bayard wrongfully
induced  certain  shareholders  and  investors  to  repudiate  and breach  their
commitments  to enter into lock-up  agreements in connection  with the Company's
November 1996 initial public offering,  that Bayard  wrongfully  interfered with
the  Company's  contractual  relations  with  Renaissance  Financial  Securities
Corporation, that Bayard breached his own agreement with the Company and his own
agreement to execute a lock-up  agreement,  and that Bayard breached  certain of
his fiduciary obligations to the Company and engaged in other actionable conduct
that damaged the Company.  The Company seeks  compensatory  damages in excess of
$3,500,000.00   and  punitive   damages.   In  April  1997,  Bayard  asserted  a
counterclaim against the Company and David E.Y. Sarna ("Sarna"), the Chairman of
the Board of the Company.  Bayard's  counterclaim  alleges,  among other things,
that the Company and Sarna  commenced  a scheme to coerce  Bayard into  entering
into a lock-up  agreement (which Bayard never signed) with respect to his shares
in the  Company  and to compel him to act on the  Company's  behalf in  inducing
other  shareholders to enter into lock-up  agreements.  Bayard also alleges that
the Company and Sarna communicated with his business associates for the purpose,
among other things, of damaging Bayard's professional  reputation.  Bayard seeks
compensatory and punitive damages in an unspecified amount. The Company moved to
dismiss the counterclaim and intends to vigorously  prosecute its claims against
Bayard.  The  Court  subsequently  ruled  that  Bayard's  counterclaim  will  be
dismissed if it is not properly  amended  within the period of time  provided by
the Court's Order.



                                      -44-

<PAGE>



                                   MANAGEMENT


EXECUTIVE OFFICERS AND DIRECTORS

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


NAME                         AGE         POSITION

David E. Y. Sarna1            47         Chairman, Secretary and Director
George J. Febish(1)           48         President, Treasurer and Director
June Petroff                  45         Senior Vice President - Sales and
                                         Marketing
Daniel E. Ryan(1)(2)(3)(4)    49         Director
Gunther L. Less               66         Director



(1)  Member of Executive Committee
(2)  Member of Audit Committee
(3)  Member of Compensation Committee
(4)  Member of Stock Option Plan Committee



           David E. Y. Sarna  together  with Mr.  Febish  founded the Company in
1990. Mr. Sarna has been the Chairman, Co-Chief Executive Officer, Secretary and
a director of the Company since December  1990. He has also been,  since 1994, a
Contributing  Editor of Datamation  magazine.  Prior to co-founding the Company,
Mr. Sarna  founded  Image  Business  Systems  Corporation,  a computer  software
development   company,  in  1988.  Prior  to  founding  Image  Business  Systems
Corporation,  Mr. Sarna was formerly Executive  Vice-President and a co- founder
of International  Systems Services Corp.  ("ISS"),  a computer  software company
that developed ISS Three(TM). From 1976 to 1981, Mr. Sarna was employed by Price
Waterhouse & Co., as a management  consultant,  beginning as a senior consultant
and rising to the  position of senior  manager.  From 1970 to 1976 Mr. Sarna was
employed by IBM  Corporation in technical and sales  positions.  Mr. Sarna began
his  professional  career at Honeywell in 1968. Mr. Sarna holds a BA degree from
Brandeis  University and did graduate work at the Technion - Israel Institute of
Technology.  Mr.  Sarna is a  Certified  Systems  Professional  and a  Certified
Computer  Programmer.  He is the  co-author,  with Mr.  Febish,  of PC  Magazine
Windows Rapid Application  Development  (published by Ziff-Davis Press in 1994),
several other books and over 50 articles  published in  professional  magazines.
Mr. Sarna is also the  co-inventor of patented  software for the  recognition of
bar-codes.

           George J. Febish together with Mr. Sarna founded the Company in 1990.
Mr. Febish has been the President,  Co-Chief Executive Officer,  Treasurer and a
director of the Company since  December  1990.  He has also been,  since 1994, a
Contributing  Editor of Datamation  magazine.  Prior to co-founding the Company,
Mr. Febish was Executive  Vice  President and Chief  Operating  Officer of Image
Business Systems Corporation, a computer software development company, from 1988
to 1990. Prior to joining Image Business Systems Corporation, Mr. Febish was the
Director of Marketing at ISS, a computer  software  company that  developed  ISS
Three(TM).  Prior to joining  ISS,  Mr.  Febish was the Eastern  Regional  Sales
Manager for Bool & Babbage.  In 1970, Mr. Febish began his  professional  career
with New York Life Insurance Company.  Mr. Febish holds a B.S. degree from Seton
Hall  University.  He is the co-author,  with Mr. Sarna, of PC Magazine  Windows
Rapid Application Development and the author of numerous published articles.

           June  Petroff  has been  the  Senior  Vice  President  of  Sales  and
Marketing  for the  Company  since  March  1997.  From 1992 until she joined the
Company, Ms. Petroff was Vice President of Marketing for Gateway


                                      -45-

<PAGE>



Outdoor  Advertising,  where she was  Marketing  Manager  from 1991 - 1992.  Ms.
Petroff has a B.A.  from Colgate  University  and did graduate  work at New York
University Graduate School of Business.

           Daniel E. Ryan has been a  director  since  1991.  Mr.  Ryan has been
employed by New York Life Insurance Company since July, 1965 where,  since 1981,
he has held the title of Corporate Vice  President.  Mr. Ryan is the head of the
Service  Center  Development of New York Life  Insurance  Company's  Information
Systems  organization.  Mr.  Ryan holds an MBA in Computer  Science  from Baruch
College and a B.S./BA in Industrial  Management from Manhattan College. Mr. Ryan
is a Certified Systems Professional.

           Gunther L.  Less.  Mr.  Less owns and  operates  GLL TV  Enterprises,
through which he has acted as the producer and host of "Journey to Adventure," a
travel-documentary  show that has appeared in syndication on broadcast and cable
television  networks  for  over 35  years.  He  also  acts  as a  special  media
consultant to the airline industry and has held various executive and consulting
positions in the travel  industry,  including as an Agency  Manager for American
Express,  President of Planned Travel,  Inc., a subsidiary of Diners Club, Inc.,
System Sales and  Marketing  Manager for Avis  Rent-A-Car  and  Manager-External
Affairs  for Olympic  Airways  and  personal  consultant  to the late  Aristotle
Onassis,  and consultant to Hyatt International  Corporation.  He is also a past
president  of the  American  Association  of Travel  Editors.  Mr.  Less was the
director nominee of the Underwriter.

           The  Company's  Board of Directors  is divided into two classes.  The
Board is  composed  of two Class I  Directors  (Messrs.  Sarna and Less) and two
Class II  Directors  (Messrs.  Febish  and  Ryan).  The term of  office  Class I
Directors  expires at the second Annual  Meeting of  Stockholders  following the
Company's  1997 Annual Meeting of  Stockholders.  The term of office of Class II
Directors  expires  at  the  Company's  1998  Annual  Meeting  of  Stockholders.
Directors  elected to succeed  those whose terms expire are elected to a term of
office  expiring at the second Annual Meeting of  Stockholders  following  their
election.  Directors hold office until the expiration of their  respective terms
and until their  successors are elected or until death,  resignation or removal.
The  classification of the Board of Directors could have the effect of making it
more difficult for a third party to acquire,  or discouraging a third party from
acquiring,  control of the Company.  Vacancies on the Board of Directors  may be
filled only with the  approval of a majority of the Board of  Directors  then in
office. Furthermore,  any director elected by the stockholders,  or by the Board
of Directors  to fill a vacancy,  may be removed only for cause and by a vote of
75% of the outstanding  shares of Common Stock.  See  "Description of Securities
- -Delaware Takeover Statute and Certain Charter Provisions."

           Executive  officers  of the  Company  are  elected  by the  Board  of
Directors  on an  annual  basis  and  serve at the  discretion  of the  Board of
Directors.


DIRECTOR COMPENSATION

           In 1996,  directors who were not officers or employers of the Company
received no compensation for attendance at Board meetings or Committee meetings,
however,  each director is reimbursed  for  out-of-pocket  expenses  incurred in
connection with attendance at meetings or other Company business.

           In March 1996 the Board of  Directors  adopted the 1996 Stock  Option
Plan ("Plan")  pursuant to which each director who is not a salaried employee of
the  Company on the date the Plan is approved  by  stockholders,  was granted an
option to purchase 10,000 shares of Common Stock.  Thereafter when each director
who is not a salaried  employee of the Company  first  becomes a director,  such
individual is granted an option to purchase  10,000  shares of Common Stock.  In
addition,  immediately  following each Annual Meeting of  Stockholders  at which
directors are elected, each person who is not a salaried employee of the Company
and is then a director  is granted an option to  purchase  an  additional  5,000
shares of Common Stock.  The exercise  price of each share of Common Stock under
any  option  granted  to a  director  under the Plan  shall be equal to the fair
market value of a share of Common Stock on the date the option is granted.



                                      -46-

<PAGE>



COMMITTEES OF THE BOARD OF DIRECTORS

           The Company has established  (i) a Compensation  Committee whose sole
member is Mr. Ryan, (ii) an Audit Committee whose sole member is Mr. Ryan, (iii)
and Executive  Committee whose members are Messrs.  Sarna,  Febish and Ryan, and
(iv) Stock Option Plan Committee whose sole member is Mr. Ryan.


EXECUTIVE COMPENSATION

           The  following  table sets forth  information  concerning  annual and
long-term compensation, paid or accrued, for the Chief Executive Officer and for
each other executive officer of the Company whose compensation exceeded $100,000
in fiscal 1996 (the "Named  Executive  Officers") for services in all capacities
to the Company during the last three fiscal years.

                         SUMMARY COMPENSATION TABLE (1)
<TABLE>
<CAPTION>
                                           Annual Compensation
                                     -------------------------------      
                                                                          Long-Term                         
                                                                        Compensation                        
                                                                        ------------
                                                                          Awards(1)
                                                            Other         ---------
Name and                                                    Annual       Securities
Principal                                                  Compen-       Underlying        All Other   
Position                             Year    Salary(2)    sation (3)    Options/SARs      Compensation 
- --------                             ----    ---------    ----------    ------------      ------------ 
<S>                                  <C>      <C>                          <C>                    
David E.Y. Sarna,                    1996     $208,000         --          50,000               --
Chairman, Secretary and              1995     $200,000         --              --               --
Co-Chief Executive Officer           1994     $200,000         --              --               --
                                                                                            
                                                                                            
George J. Febish,                    1996     $208,000         --          50,000               --
President, Treasurer and             1995     $200,000         --              --               --
Co-Chief Executive Officer           1994     $200,000         --              --               --
</TABLE>

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

(1)  None of the Named Executive  Officers  received any Restricted Stock Awards
     or LTIP Payouts in 1994, 1995 or 1996.

(2)  Includes  $107,220  that was accrued but not paid to each of Messrs.  Sarna
     and Febish in 1995. At December 31, 1995, the total amount of  compensation
     accrued  but not paid to each of Messrs.  Sarna and  Febish,  inclusive  of
     prior years,  was $195,844.  Such amounts were  subsequently  paid in full,
     with $100,000 and $50,000 paid to each of Messrs. Sarna and Febish from the
     proceeds of a bridge loan offering of notes and warrants  completed in June
     1996 (the "Bridge Loan  Offering") and an offering of units of common stock
     and  warrants   completed  in  August  1996  (the  "July  1996  Offering"),
     respectively, and the balance paid from operating revenues.

(3)  As to each individual named, the aggregate amounts of personal benefits not
     included  in the  Summary  Compensation  Table do not  exceed the lesser of
     either $50,000 or 10% of the total annual salary and bonus reported for the
     Named Executive Officer.



                                      -47-

<PAGE>



EMPLOYMENT AGREEMENTS

           The Company has entered  into an  employment  agreement  with each of
David E. Y.  Sarna and George J.  Febish,  effective  as of July 1, 1996,  which
expires on December  31,  2001.  The  employment  agreements  each provide for a
current annual base salary of $208,000.  Each of the employment  agreements also
provides  for a  bonus  of  5%  per  annum  of  the  Company's  Earnings  Before
Depreciation, Interest, Taxes and Amortization. In addition, on an annual basis,
the Board of  Directors  will  consider  paying an  additional  bonus to each of
Messrs.  Sarna and Febish that is based upon the increase in the Company's gross
revenues, taking into account any increase in the Company's expenses. The annual
base salary under the current  agreements  may be increased at the discretion of
the Board of Directors.  The agreements  provide for (i) a severance  payment of
the base compensation and bonus of the prior full fiscal year and payment of all
medical,  health,  disability and insurance benefits then payable by the Company
for the longer of (a) the remainder of the term of the  employment  agreement or
(b) 12 months,  as well as (ii) the base  compensation  and bonus accrued to the
date of  termination,  upon the  occurrence  of (x)  termination  by the Company
without cause,  (y)  termination by the employee for good reason or (z) a change
in control of the Company,  if the employee resigns after the occurrence of such
change  in  control.  Each of the  employment  agreements  limit  the  severance
payments  to an amount  that is less than the amount  that would cause an excise
tax or loss of deduction under the rules relating to golden parachutes under the
Internal Revenue Code.


OFFICER WARRANTS

           Each of David E. Y. Sarna and George J.  Febish have  entered  into a
Warrant  and  Warrant  Agreement  with the  Company.  The  Warrant  and  Warrant
Agreements, dated April 15, 1993 (the "Officer Warrants") provides for the right
of each of them to purchase  50,000 shares of Common Stock at an exercise  price
per share of $.50. The Officer  Warrants permit the executive's  estate to cause
the Company to purchase the  underlying  shares at the Company's  book value per
share.  The Officer  Warrants provide that the number of shares and the exercise
price  are  subject  to   anti-dilution   adjustments  and  grants   "piggyback"
registration  rights with respect to the underlying  shares. See "Description of
Securities - Outstanding  Warrants and Options -  Officer/Stockholder  Warrants;
1996 Stock Option Plan."


STOCK OPTIONS

           The following table sets forth  information as to all grants of stock
options to the Named Executive  Officers during fiscal 1996 under the 1996 Stock
Option Plan (and does not include any options granted by the Company  subsequent
to December 31, 1996).


                            OPTION GRANTS IN 1996(1)



                                            Individual Grants (1)
                            ---------------------------------------------------
                            Number of     % of Total
                           Securities       Options
                           Underlying     Granted to
                             Options       Employees     Exercise    Expiration
Name                         Granted        in 1996        Price      Date (2)
- ----                         -------        -------        -----      --------

David E.Y. Sarna             50,000          34.5%         $3.50    July 1, 2001
George J. Febish             50,000          34.5%         $3.50    July 1, 2001


                                      -48-
<PAGE>


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

(1)  No stock  appreciation  rights  ("SARs")  were  granted to any of the Named
     Executive Officers during fiscal 1996.
(2)  The options became exercisable immediately on the grant date.


           There were no stock option or SAR exercises during fiscal 1996 and no
SARs were outstanding at December 31, 1996.


1996 STOCK OPTION PLAN

           The Company's 1996 Stock Option Plan (the "Plan") was approved by the
Company's Board of Directors in 1996. The Company has reserved 250,000 shares of
Common Stock under the Plan and an additional  500,000 shares have been approved
by the Company's Board,  subject to approval of the holders of a majority of the
Company's  Common Stock if required.  Options granted under the Plan may include
those  qualified as incentive  stock  options  under Section 422 of the Internal
Revenue  Code  of  1986,  as  amended,  as well as  non-qualified  options.  Key
employees as well as other individuals,  such as outside directors,  consultants
and  advisors  who provide  necessary  services  to the Company are  eligible to
participate in the Plan.  Non-employees and part-time employees may receive only
non-qualified options.  Options to purchase an aggregate of 250,000 options have
been granted to date under the Plan, including 50,000 options granted to each of
David E. Y.  Sarna and  George  J.  Febish,  the  Company's  Co-Chief  Executive
Officers .

           The Plan is administered  by the Stock Option  Committee of the Board
of Directors,  which will be comprised solely of non-employee directors (who are
"outside directors" within the meaning of Section 162(m) of the Internal Revenue
Code of 1986,  as amended (the "Code") and  "disinterested  persons"  within the
meaning of Rule 16b-3 under the Exchange Act (the  "Committee")).  The Committee
can make such  rules and  regulations  and  establish  such  procedures  for the
administration of the Plan as it deems  appropriate.  No member of the Committee
shall be eligible to receive  discretionary  grants of options during, and for a
period of one year  following,  their  service on the  Committee.  The Committee
presently  consists of Mr. Ryan. The description of the Plan set forth herein is
qualified  in its entirety by reference to the text of the Plan, a copy of which
is filed as an exhibit to the  Registration  Statement of which this  Prospectus
forms a part.

           The  exercise  price  for  the  shares  purchased  upon  exercise  of
non-qualified options granted under the Plan is determined by the Committee. The
exercise price of an incentive  stock option must be at the fair market value of
the  Company's  Common Stock on the date of grant (110% of the fair market value
for  stockholders  who, at the time the option is granted,  own more than 10% of
the total  combined  classes  of stock of the  Company  or any  subsidiary).  No
employees may exercise more than $100,000 in options held by them in any year.

           Each  director who was not a salaried  employee of the Company on the
date the Plan was  approved by  stockholders,  was granted an option to purchase
10,000  shares of Common  Stock.  Thereafter,  when each  director  who is not a
salaried  employee of the Company first becomes a director,  such  individual is
granted  an option to  purchase  10,000  shares of Common  Stock.  In  addition,
immediately following each Annual Meeting of Stockholders at which directors are
elected, each person who is not a salaried employee of the company and is then a
director is granted an option to purchase an  additional  5,000 shares of Common
Stock. The exercise price of each share of Common Stock under any option granted
to a director  under the Plan shall be equal to the fair market value of a share
of Common Stock on the date the option is granted.

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


                                      -49-

<PAGE>



           The  following  is a  general  summary  of  the  federal  income  tax
consequences  under current tax law of nonqualified  stock options ("NQSOs") and
incentive  stock  options  ("ISOs").  It does not  purport  to cover  all of the
special  rules,  including  special  rules  relating  to persons  subject to the
reporting  requirements of Section 16 under the Exchange Act who do not hold the
shares acquired upon the exercise of an option for at least six months after the
date of grant of the option and special  rules  relating  to the  exercise of an
option with  previously-acquired  shares,  or the state or local income or other
tax consequences inherent in the ownership and exercise of stock options and the
ownership and disposition of the underlying shares.

           An optionee will not recognize  taxable income for federal income tax
purposes upon the grant of a NQSO or an ISO.

           Upon the exercise of a NQSO,  the optionee  will  recognize  ordinary
income in an amount equal to the excess, if any, of the fair market value of the
shares acquired on the date of exercise over the exercise price thereof, and the
Company will  generally be entitled to a deduction for such amount at that time.
If the optionee later sells shares acquired  pursuant to the exercise of a NQSO,
he or she will recognize long-term or short-term capital gain or loss, depending
on the  period  for  which the  shares  were  held.  Long-term  capital  gain is
generally  subject to more  favorable  tax  treatment  than  ordinary  income or
short-term capital gain. Proposed legislation would treat long-term capital gain
even more  favorably.  There can be no  assurance,  however,  that such proposed
legislation will be enacted.

           Upon the exercise of an ISO, the optionee will not recognize  taxable
income. If the optionee disposes of the shares acquired pursuant to the exercise
of an ISO more  than two  years  after  the date of grant and more than one year
after the  transfer of the shares to him or her,  the  optionee  will  recognize
long-term  capital  gain or loss  and the  Company  will  not be  entitled  to a
deduction.  However, if the optionee disposes of such shares within the required
holding period,  all or a portion of the gain will be treated as ordinary income
and the Company will generally be entitled to deduct such amount.

           In addition to the federal income tax  consequences  described above,
an optionee may be subject to the  alternative  minimum tax, which is payable to
the extent it exceeds the  optionee's  regular tax. For this  purpose,  upon the
exercise of an ISO,  the excess of the fair market  value of the shares over the
exercise price therefor is an adjustment  which  increases  alternative  minimum
taxable income. In addition, the optionee's basis in such shares is increased by
such excess for purposes of computing the gain or loss on the disposition of the
shares for alternative  minimum tax purposes.  If an optionee is required to pay
an  alternative  minimum  tax, the amount of such tax which is  attributable  to
deferral  preferences  (including  the ISO  adjustment)  is  allowed as a credit
against the optionee's  regular tax liability in subsequent years. To the extent
the credit is not used, it is carried forward.


SEP

           The Company established in 1990 a simplified employee pension ("SEP")
plan covering all qualified employees.  Pursuant to the SEP, employees may elect
to  contribute  up to 15% of their  compensation  on a pre-tax  basis (up to the
statutory  prescribed annual limit ($9,500 in 1997)) to the SEP. The SEP plan is
intended to qualify under Section 408(k) of the Internal Revenue Code.


401(K) PLAN

           Effective  April 1, 1997,  the Company  adopted a Profit Sharing Plan
and Trust intended to qualify under Section 401(k) of the Internal  Revenue code
of 1986, as amended.  Company  employees are eligible to participate in the plan
if they were  employed by the  Company on April 1, 1997,  and  otherwise  become
eligible to  participate  in the plan if they have  completed  one-half  year of
service with the Company and have attained age 21. Each  participant in the plan
may elect to defer,  in the form of  contributions  to the plan,  no more than a
specified  percentage  of  compensation  that  would  otherwise  be  paid to the
eligible employee in the applicable year, not to


                                      -50-

<PAGE>



exceed a statutorily  prescribed  annual limit of $9,500 in 1997,  provided that
allocations  to any  participant's  account  may  generally  be no more than the
lesser of $30,000 or 25% of any such participant's compensation in any year. The
Company  makes  discretionary  matching  contributions  to the plan on behalf of
participants  as  determined  each  year  by the  Company,  subject  to  certain
conditions  set  forth  in  the  plan,  and  may  make a  special  discretionary
contribution  equal to a  percentage  of the  participant's  contribution.  Each
participant  is always  100%  vested in the  amount  that such  participant  has
contributed,  is 100% vested in the Company's special  contributions made to the
plan and is subject  to certain  vesting  provisions  included  in the plan with
respect to the Company's discretionary matching contributions (25% after each of
the first four years of service).


KEY-MAN LIFE INSURANCE

           The Company currently maintains key man insurance, of which it is the
beneficiary,  on the lives of each of David E. Y. Sarna and George J.  Febish in
the amount of $1,000,000 each.


LIMITATION OF LIABILITY AND INDEMNIFICATION MATTERS

           The  Company's   Certificate  of   Incorporation,   as  amended  (the
"Certificate  of  Incorporation")  and its  Amended  and  Restated  Bylaws  (the
"Bylaws") provides that, except to the extent prohibited by the Delaware General
Corporation Law, its directors shall not be personally  liable to the Company or
its  stockholders  for  monetary  damages  for any breach of  fiduciary  duty as
directors of the Company.  Under  Delaware law, the  directors  have a fiduciary
duty to the Company which is not eliminated by the provisions of the Certificate
of Incorporation and, in appropriate  circumstances,  equitable remedies such as
injunctive  or other forms of  non-monetary  relief will  remain  available.  In
addition,  each director will continue to be subject to liability under Delaware
law for breach of the  director's  duty of loyalty  to the  Company  for acts or
omissions which are found by a court of competent jurisdiction to be not in good
faith or involving  intentional  misconduct,  for knowing violations of law, for
actions leading to improper personal benefit to the director, and for payment of
dividends or approval of stock repurchases or redemptions that are prohibited by
Delaware   law.   This   provision   also  does  not   affect   the   directors'
responsibilities  under any other laws,  such as the Federal  securities laws or
state or Federal environmental laws.

           The  Certificate  of  Incorporation  and Bylaws also provide that the
Company shall  indemnify,  to the fullest extent permitted by Section 145 of the
Delaware  General  Corporation  Law, all of its present and former  officers and
directors, and any party agreeing to serve as an officer, director or trustee of
any entity at the Company's  request,  in connection  with any civil or criminal
proceeding  threatened or instituted  against such party by reason of actions or
omissions  while  serving  in  such  capacity.  Indemnification  by the  Company
includes  payment of expenses in defense of the indemnified  party in advance of
any proceeding or final disposition  thereof if the indemnified party undertakes
to repay the Company upon an ultimate  determination  that the indemnified party
was not entitled to indemnification by the Company. This provision also requires
Board of  Director  approval as a  precondition  to any  indemnification  by the
Company for  proceedings  instituted  by the  indemnified  party.  The rights to
indemnification  provided in this  provision do not preclude the exercise of any
other indemnification rights by any party pursuant to any law, agreement or vote
of the stockholders or the disinterested directors of the Company.

           Section 145 of the Delaware General  Corporation Law generally allows
the Company to indemnify the parties  described in the  preceding  paragraph for
all  expenses,  judgments,  fines and amounts in  settlement  actually  paid and
reasonably  incurred in connection  with any  proceedings  so long as such party
acted in good faith and in a manner reasonably  believed to be in or not opposed
to the Company's best  interests and, with respect to any criminal  proceedings,
if such  party had no  reasonable  cause to  believe  his or her  conduct  to be
unlawful.  Indemnification  may only be made by the  Company  if the  applicable
standard  of conduct  set forth in Section  145 has been met by the  indemnified
party upon a determination made (1) by the Board of Directors by a majority vote
of a quorum of directors who are not parties to such proceedings, or (2) if such
a quorum is not obtainable


                                      -51-

<PAGE>



or if directed by a quorum of  disinterested  directors,  by  independent  legal
counsel in a written opinion, or (3) by the stockholders.

           The Company will seek to purchase and maintain directors and officers
insurance as soon as the Board of Directors determines  practicable,  in amounts
that is considers  appropriate,  insuring the directors and officers against any
liability arising out of their status as such, regardless of whether the Company
has the power to indemnify such persons against such liability under  applicable
law.

           Insofar  as  indemnification   for  liabilities   arising  under  the
Securities Act may be permitted to directors,  officers and controlling  persons
of the Company  pursuant to the foregoing  provisions or otherwise,  the Company
has been advised that in the opinion of the Securities and Exchange  Commission,
such indemnification is against public policy as expressed in the Securities Act
and is, therefore, unenforceable.


                                      -52-

<PAGE>



                             PRINCIPAL STOCKHOLDERS

           The following table sets forth, as of September 30, 1997, information
with respect to the  beneficial  ownership of the Company's  Common Stock by (i)
each  person  known by the  Company  to  beneficially  own  more  than 5% of the
outstanding  shares of Common Stock,  (ii) each  director of the Company,  (iii)
each of the Named  Executive  Officers (as such term is herein defined) and (iv)
all directors and executive officers of the Company as a group.


Name and                                   Number of Shares        Percentage
Address of                                  of Common Stock        Ownership(3)
Beneficial Owners(1)                         Beneficially          ------------
- --------------------                           Owned(2)
                                              ----------
David E. Y. Sarna (4) (5)                       847,500                20.3%

George J. Febish (4) (6)                        907,500                21.7%

June Petroff (7)                                 20,000                  *

Melvin Weinberg, Esq. (8)                       300,000                 7.3%
c/o Parker Chapin Flattau & Klimpl, LLP
1211 Avenue of the Americas
New York, New York  10036

Cyndel & Co., Inc. (9)                          242,500                 6.0%
26 Ludlam Avenue
Bayville, New York 11709

Steven Bayern (10)                              288,000                 7.0%
26 Ludlam Avenue
Bayville, New York 11709

Daniel E. Ryan (11)                              15,000                  *

Gunther L. Less (11)                             15,000                  *

All officers and directors as                 1,805,000                41.7%
a group (5 persons) (3)(11)

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

*    Less than 1%.
(1)  Unless  otherwise  indicated,  the business address of each of the officers
     and directors is c/o  ObjectSoft  Corporation,  Continental  Plaza III, 433
     Hackensack Avenue, Hackensack, New Jersey 07601
(2)  Unless  otherwise  noted,  the Company believes that all persons named have
     sole voting and investment power with respect to all shares of Common Stock
     listed as owned by them.
(3)  Each person's  percentage interest is determined assuming that all options,
     warrants and  convertible  securities that are held by such person (but not
     by anyone else) and which are  exercisable  or  convertible  within 60 days
     have been exercised for or converted into Common Stock.
(4)  Includes,  for each of Messrs.  Sarna and Febish,  immediately  exercisable
     warrants  to  purchase  50,000  shares of Common  Stock and 50,000  options
     granted under the Company's 1996 Stock Option Plan.


                                      -53-

<PAGE>



(5)  Includes  150,000 shares held by The David E. Y. Sarna Family Trust ("Sarna
     Trust"), of which Rachel Sarna, the wife of Mr. Sarna, and Melvin Weinberg,
     Esq.  are the  trustees.  The  children of Mr. and Mrs.  Sarna are the sole
     beneficiaries.  Mr. Sarna disclaims beneficial ownership of the shares held
     by the Sarna Trust.
(6)  Includes  150,000 shares held by The George J. Febish Family Trust ("Febish
     Trust"),  of  which  Janis  Febish,  the  wife of Mr.  Febish,  and  Melvin
     Weinberg,  Esq. are the trustees.  The children of Mr. and Mrs.  Febish are
     the sole beneficiaries.  Mr. Febish disclaims  beneficial  ownership of the
     shares held by the Febish Trust.
(7)  Includes  immediately  exercisable  options to  purchase  20,000  shares of
     Common Stock granted under the Company's 1996 Stock Option Plan.
(8)  Melvin  Weinberg,  Esq.,  by virtue of his  shared  dispositive  power as a
     trustee  over the shares of Common  Stock held by both the Sarna  Trust and
     the  Febish  Trust  (collectively  the  "Family  Trusts"),  may be deemed a
     beneficial owner of a total of 300,000 shares of Common Stock, representing
     the aggregate share holdings of the Family Trusts.  The Sarna Trust was set
     up by Mr.  Sarna for the benefit of his  children.  Mr.  Weinberg  and Mrs.
     Sarna are  trustees  of the Sarna  Trust and share  dispositive  power with
     respect to the shares of Common  Stock owned by the Sarna  Trust,  but Mrs.
     Sarna has the sole voting  power with  respect to such  shares.  The Febish
     Trust  was  set up by Mr.  Febish  for the  benefit  of his  children.  Mr.
     Weinberg  and Mrs.  Febish  are  trustees  of the  Febish  Trust  and share
     dispositive  power with  respect to the shares of Common Stock owned by the
     Febish  Trust,  but Mrs.  Febish has the sole voting  power with respect to
     such shares. Mr. Weinberg disclaims  beneficial  ownership of the shares of
     Common Stock held by the Family Trusts.
(9)  Includes  immediately  exercisable  warrants to purchase  20,000  shares of
     Common Stock. Cyndel & Company,  Inc. ("Cyndel") is engaged in the business
     of management consulting and is owned by Steven Bayern and Patrick Kolenik.
     Mr. Kolenik,  the president of Cyndel, does not own any other securities of
     the Company.
(10) Includes  (i) 222,500  shares of Common Stock and  immediately  exercisable
     warrants to purchase 20,000 shares of Common Stock owned by Cyndel and (ii)
     27,300  shares of Common  Stock  issuable  upon the exercise of a placement
     agent warrant issued to Win Capital  Corporation,  the placement agent of a
     private  placement of units of Common Stock and warrants that was completed
     in August 1996,  and the 18,200  shares of Common Stock  issuable  upon the
     exercise of the  warrants  included in such  warrant.  Mr.  Bayern is a 50%
     owner and the vice  president of Cyndel and the Chairman and  approximately
     50% owner of Win Capital Corporation. Mr. Bayern is presumed to have shared
     dispositive  power of the shares  owned or to be acquired by Cyndel and the
     shares to be acquired by Win Capital Corporation.
(11) Includes,  for each of  Messrs.  Ryan  and  Less,  immediately  exercisable
     options  to  purchase  15,000  shares of  Common  Stock  granted  under the
     Company's 1996 Stock Option Plan.



                              CERTAIN TRANSACTIONS


           The Company believes that all transactions  with affiliates were made
on  terms  no  less   favorable  to  the  Company  than  those   available  from
non-affiliated  third parties.  All future transactions  between the Company and
its officers,  directors or 5%  stockholders  will be on terms no less favorable
than could be obtained from non-affiliated third parties and will be approved by
a majority of the independent, disinterested directors of the Company.


ISSUANCE AND REDEMPTION OF SERIES B PREFERRED STOCK

           In December 1995,  Cyndel,  a principal  stockholder,  acquired 1,250
shares of Series B Preferred Stock in  consideration of the payment of $125,000.
The Series B Preferred Stock was  convertible  into a number of shares of Common
Stock  equal to a  fraction  the  numerator  of which was $100 per share and the
denominator  of which was 125% of the offering price per share for the shares of
Common Stock in an initial public offering. In


                                      -54-

<PAGE>



July 1996,  the Company used  $125,000 of the proceeds of the July 1996 Offering
to redeem the Series B  Preferred  Stock.  In  connection  with the  redemption,
Cyndel received  warrants,  exercisable for a period of three years, to purchase
20,000 shares of Common Stock at an exercise price of $7.00 per share.


PAYMENT OF DEFERRED OFFICERS' COMPENSATION

           Each of Mr. Sarna and Mr. Febish,  Co-Chief Executive Officers of the
Company,  agreed to defer a portion of his salary for  various  periods  through
1995  until the  Company  had  sufficient  working  capital  to pay them.  As of
December  31, 1995,  the Company  owed Messrs.  Sarna and Febish an aggregate of
$391,687,  of which  $200,000  was paid from the  proceeds  of the  Bridge  Loan
Offering, $100,000 was paid from the proceeds of the July 1996 Offering, and the
balance  was  paid  from  operating   revenues.   See  "Management  -  Executive
Compensation."

MERGER

           The Company is the  successor-in-interest to the assets,  liabilities
and  business  of  ObjectSoft-NJ,  which was merged  into the Company in January
1996.  The  purpose  of the  Merger  was to  effect  the  change of the state of
incorporation of ObjectSoft-NJ. The directors determined that it was in the best
interests  of the Company  that the Company be  re-incorporated  in the State of
Delaware.   The   re-incorporation   was  effected  by  a  migratory  merger  of
ObjectSoft-NJ  into the Company.  The  stockholders of  ObjectSoft-NJ  were duly
noticed  and  voted  in  favor  of  the  Merger  at a  Special  Meeting  of  the
Stockholders  held  on  January  30,  1996.  Each  share  of  capital  stock  of
ObjectSoft-NJ  was  exchanged  for a like share of capital  stock of the Company
upon the effectiveness of the Merger.


EXTENSION OF EXPIRATION DATES OF OFFICER WARRANTS

           In  consideration  of their  waiver of the  registration  rights with
respect to the  Offering and their  agreement to enter into an 18 month  lock-up
agreement with the Underwriter, the expiration date of the Officer Warrants held
by Messrs.  Sarna and Febish was extended to April 30, 2000. See "Description of
Securities - Outstanding  Warrants and Options -  Officer/Stockholder  Warrants"
and "Concurrent Offering."


RECENT SALES OF SECURITIES

           Win  Capital  Corporation,   an  affiliate  of  Cyndel,  a  principal
stockholder  of the  Company,  acted as the  placement  agent  for the July 1996
Offering  and, in  connection  with its  services as placement  agent,  received
commissions  equal to 10% of the gross  proceeds  of the July 1996  Offering,  a
non-accountable  expense  allowance  equal  to 3% of the  gross  proceeds  and a
warrant to purchase  27,300 units (each unit  consisting  of one share of Common
Stock and one warrant to purchase  one share of Common Stock at $4.50 per share)
at an exercise  price of $4.50 per unit for a period of three  years  commencing
upon  issuance  (the  "July  Placement  Warrant").  The  shares of Common  Stock
included in the units sold to  investors  in July and August 1996 and the shares
of Common Stock issuable upon the exercise of the warrants contained therein, as
well as the  shares of  Common  Stock  issuable  upon the  exercise  of the July
Placement  Warrant (and the warrants  issuable  upon the exercise  thereof) have
been  registered  for  resale.  See  "Principal   Stockholders"  and  Concurrent
Offering."



                                      -55-

<PAGE>



           In December  1995,  Cyndel,  a principal  stockholder of the Company,
acquired  1,250  shares  of Series B  Preferred  Stock in  consideration  of the
payment of $125,000.  The Series B Preferred Stock was  convertible  into 20,000
shares of Common  Stock  based  upon an  offering  price in the  initial  public
offering of the Company of $5.00.


REDEMPTION OF SERIES A PREFERRED STOCK

           Pursuant  to the  terms of the  Series A  Preferred  Stock,  upon the
effectiveness of the Company's  initial public offering,  all shares of Series A
Preferred  Stock  were  redeemed  at $1.00 per share plus all  accumulated,  but
unpaid,  dividends  with  respect to which an  aggregate  redemption  payment of
approximately $275,000 was made by the Company.


SERIES B PREFERRED REDEMPTION

           In July 1996,  the Company used  $125,000 of the proceeds of the July
1996 Offering to redeem the Series B Preferred  Stock.  In  connection  with the
redemption,  Cyndel received a warrant, exercisable for a period of three years,
to purchase  20,000  shares of Common  Stock at an  exercise  price of $7.00 per
share.


LOANS TO OFFICER

           The  Company  made a loan to Mr.  Sarna in the amount of  $440,000 on
January 2, 1997. The loan is payable on November 30, 1997, together with accrued
interest  at the  rate of  eight  percent  (8%)  per  annum  on the  outstanding
principal  amount or ten percent (10%) per annum in the event of a default.  The
loan was approved by all of the directors of the Company. Mr. Sarna utilized the
funds for a block  purchase of 80,000 shares of the Company's  Common Stock from
the market maker, who is also the Underwriter, in an open market transaction. In
February 1997, the Company loaned Mr. Sarna an additional $197,500 under similar
terms, which loan was repaid with interest in June, 1997.


                            DESCRIPTION OF SECURITIES


           The Company is authorized to issue up to 20,000,000  shares of Common
Stock, par value $.0001 per share and up to 5,000,000 shares of Preferred Stock,
par value $.0001 per share.


COMMON STOCK

           Holders of shares of Common  Stock are entitled to one vote per share
on all matters that are  submitted to the  stockholders  for their  approval and
have no  cumulative  voting  rights.  Subject to the prior  rights of  Preferred
Stock, the holders of Common Stock are entitled to receive dividends, if any, as
may be declared by the Board of Directors from funds legally available therefor,
from time to time. Upon liquidation or dissolution of the Company, the remainder
of the assets of the Company will be  distributed  ratably  among the holders of
Common  Stock,  after the  payment  of all  liabilities  and the  holders of any
Preferred Stock. The Common Stock has no preemptive or other subscription rights
and there are no  conversion  or sinking  fund  provisions  with respect to such
shares.  All of the  outstanding  shares of Common  Stock  are,  and the  shares
issuable upon exercise of Class A Warrants will be, upon payment of the exercise
price,  fully paid and  nonassessable.  As of  September  30,  1997,  there were
4,082,676 shares of Common Stock outstanding.




                                      -56-

<PAGE>



PREFERRED STOCK

           The  Preferred  Stock may be issued from time to time by the Board of
Directors without the approval of the stockholders of the Company.  The Board of
Directors is  authorized  to issue these shares in different  classes and series
and, with respect to each class or series, to determine the dividend rights, the
redemption provisions, conversion provisions,  liquidation preferences and other
rights and preferences not in conflict with the Certificate of  Incorporation of
the  Company  or  Delaware  law.  The Board of  Directors,  without  stockholder
approval,  could issue Preferred  Stock which would adversely  affect the voting
and other rights of the holders of Common Stock.


CLASS A WARRANTS

           Each Class A Warrant  entitles  the holder  thereof to  purchase  one
share of Common  Stock at an exercise  price of $6.50 share (130% of the initial
public offering price per Unit),  subject to adjustment,  at any time commencing
November 12, 1997 until  November 12, 2001.  The Class A Warrants are redeemable
by the Company at a price of $.10 per Class A Warrant  commencing  November  12,
1997 (or earlier with the consent of the  Underwriter)  on not less than 30 days
prior written notice to the holders  thereof,  provided the average  closing bid
quotation of the Common Stock as reported on NASDAQ,  if traded  thereon,  or if
not traded  thereon,  the average  closing bid  quotation of the Common Stock if
listed on a  national  securities  exchange  (or  other  reporting  system  that
provides last sale prices),  has been at least 130% of the then current exercise
price of the Class A Warrants  (initially,  $8.45 per share), for a period of 20
consecutive  trading days ending within 15 days of the date on which the Company
gives notice of redemption.  The Class A Warrants will be exercisable  until the
close  of  business  on  the  day  immediately  preceding  the  date  fixed  for
redemption.

           The Class A Warrants may be exercised  upon  surrender of the Class A
Warrant  certificate  on or prior to the  expiration  date at the offices of the
warrant agent, with the exercise form on the reverse side of the Class A Warrant
certificate completed and executed as indicated,  accompanied by full payment of
the exercise price (by certified  check or bank draft payable to the Company) to
the warrant agent for the number of Class A Warrants being exercised.  The Class
A Warrant  Holders  do not have the  rights or  privileges  of holders of Common
Stock.

           No Class A Warrant will be exercisable unless at the time of exercise
the  Company  has filed a current  registration  statement  with the  Commission
covering  the shares of Common  Stock  issuable  upon  exercise  of such Class A
Warrant and such shares have been registered or qualified or deemed to be exempt
from  registration  or  qualification  under the securities laws of the state of
residence  of the holder of such Class A Warrant.  The Company will use its best
efforts to have all such  shares so  registered  or  qualified  on or before the
exercise date and to maintain a current  prospectus  relating  thereto until the
expiration  of the  Class  A  Warrants,  subject  to the  terms  of the  Warrant
Agreement.  While  it is  the  Company's  intention  to do so,  there  can be no
assurance that it will be able to do so.

           No  fractional  shares  will be issued  upon  exercise of the Class A
Warrants. However, if a Warrant Holder exercises all Class A Warrants then owned
of record by him, the Company will pay to such  Warrant  Holder,  in lieu of the
issuance of any fractional share which is otherwise issuable,  an amount in cash
based on the market  value of the Common  Stock on the last trading day prior to
the exercise date.

           Commencing  one year  after  the date of this  Prospectus,  until the
expiration of the exercise period of the Class A Warrants,  the Company will pay
the  Underwriter  a fee of 5% of the  exercise  price  of each  Class A  Warrant
exercised,  provided,  (i) the market price of the Common Stock on the date such
warrant was exercised was greater than the warrant  exercise price on that date,
(ii) the exercise of such warrant was  solicited by a member of the NASD,  (iii)
such warrant was not held in a  discretionary  account,  (iv) the  disclosure of
compensation  arrangements  was made both at the time of the Offering and at the
time of exercise of such warrant,  (v) the  solicitation of the exercise of such
warrant was not a violation of applicable  provisions under the Exchange Act and
(vi) the Underwriter is designated in writing as the soliciting NASD member. The
Underwriter


                                      -57-

<PAGE>



and any other soliciting  broker/dealers  may be prohibited from engaging in any
market making  activities or solicited  brokerage  activities with regard to the
Company's  securities  during  certain  periods before the  solicitation  of the
exercise  of any Class A Warrant  until  the  later of the  terminating  of such
solicitation  activity or the  termination of any right the  Underwriter and any
other soliciting broker/dealer may have to receive a fee for the solicitation of
the Class A Warrants.


OTHER WARRANTS AND OPTIONS


Officer/Stockholder Warrants; 1996 Stock Option Plan

           In April 1993 the Company issued common stock warrants to purchase an
aggregate of 143,333  shares of Common Stock,  exercisable  at $.50 per share of
Common Stock (the "Officer  Warrants").  The Officer Warrants were issued to two
executive officers and a former officer of the Company in consideration of their
foregoing   salaries  in  1992.  The  Officer  Warrants  contain   anti-dilution
provisions  providing for  adjustments  of the exercise  price and the number of
shares  underlying the Officer  Warrants upon the occurrence of certain  events,
including any recapitalization,  reclassification,  consolidation, merger, sale,
lease or  conveyance of all or  substantially  all of the assets of the Company,
stock  dividend,  stock split,  stock  combination or similar  transaction.  The
holders of the Officer  Warrants have the right to cause the Company to register
the Officer  Warrants and the shares of Common Stock  issuable  upon exercise of
the  Officer  Warrants,  if the Company  registers  any of its  securities  on a
registration  statement filed with the SEC for sale to the general  public.  The
original  expiration  date of the  Officer  Warrants  was  April  30,  1998.  In
consideration  of their  waiver of the  registration  rights with respect to the
Offering and their  agreement to enter into an 18 month lock-up  agreement  with
the  Underwriter,  the expiration date of the 100,000  Officer  Warrants held by
Messrs.  Sarna and  Febish was  extended  to April 30,  2000.  The resale of the
shares issuable upon the exercise of the other 43,333 Officer  Warrants has been
registered in the Selling Securityholder Prospectus. See "Concurrent Offering."

           In July 1996,  in  connection  with the  redemption  of the Company's
Series B Preferred Stock, the Company issued to Cyndel, a principal  stockholder
of the Company, warrants to purchase 20,000 shares of the Company's Common Stock
at an exercise price of $7.00 per share.  These warrants expire on July 29, 1999
and contain  anti-dilution  provisions providing for adjustments of the exercise
price and the number of shares  underlying  such warrants upon the occurrence of
certain events, including any recapitalization, reclassification, consolidation,
merger,  sale, lease or conveyance of all or substantially  all of the assets of
the  Company,  stock  dividend,   stock  split,  stock  combination  or  similar
transaction.

           As of July 31,  1997,  options to  purchase an  aggregate  of 250,000
shares had been granted under the  Company's  1996 Stock Option Plan of which an
option for 5,000 shares was cancelled without exercise.  See "Management -- 1996
Stock Option Plan."




                                      -58-

<PAGE>



Consultant Stock Options

           In August 1995, the Company issued to a consultant of the Company the
right to acquire up to 100,000 shares of Common Stock,  exercisable at $1.00 per
share in consideration of the consultant  foregoing the payment of up to $10,000
for services rendered. On September 15, 1995, the consultant accepted the offer.
This option was  exercisable  at any time from the date of grant until the fifth
anniversary of the date of grant. In May 1996, the agreement with the consultant
was amended,  and warrants for 50,000 shares were canceled in consideration of a
cash payment of $5,000.

           The Company has also entered into agreements with another  consultant
pursuant to which the Company issued to such  consultant  options to purchase an
aggregate  of 10,000  shares of Common  Stock  exercisable  for a period of five
years at an exercise price of $1.00.  To date,  60,000  consultant  options have
been  received by two  consultants  of the Company,  which were all exercised by
September 30, 1997.


Private Placement Warrants

           The Company has  outstanding  375,000  Bridge  Warrants and July 1996
Warrants to purchase  182,004  shares of Common Stock,  as described in "Certain
Transactions -- Recent Financings," above.


Placement Agent's Warrant; July Placement Warrant

           In connection with the Bridge Loan Offering,  the Company sold to the
Underwriter,  in its capacity as Placement Agent of such offering, the Placement
Agent's  Warrant to  purchase a number of Units  equal to 10% of Units  issuable
upon the  exercise of the Bridge  Warrants  contained in the Bridge  Units.  The
exercise price of the Placement  Agent's Warrant is $5.00. The Placement Agent's
Warrant contains anti-dilution provisions providing for adjustments of $5.00 the
exercise price and the number of shares underlying the Placement Agent's Warrant
upon  the  occurrence  of  certain  events,   including  any   recapitalization,
reclassification,  stock  dividend,  stock split,  stock  combination or similar
transaction.  None of the securities  underlying the Placement  Agent's  Warrant
will be redeemable.  The Placement  Agent's  Warrant grants the holders  thereof
certain registration rights which are described below.

           In  connection  with the sale of the July 1996 Units,  the  placement
agent for such sale,  Win Capital  Corporation , was granted the July  Placement
Warrant to purchase  27,300  July 1996 Units at an  exercise  price of $4.50 per
July 1996 Unit. The July Placement  Warrant  contains  anti-dilution  provisions
providing  for  adjustments  of the  exercise  price  and the  number  of shares
underlying  the July Placement  Warrant upon the  occurrence of certain  events,
including any recapitalization,  reclassification,  stock dividend, stock split,
stock combination or similar transaction.  None of the securities underlying the
July Placement Warrant will be redeemable, and the holders of the July Placement
Warrant have certain registration rights, described below.

           The resale of the shares of Common Stock  issuable  upon the exercise
of the  Placement  Agent's  Warrant and the Class A Warrants  issuable  upon the
exercise  thereof,  as well as the resale of the shares of Common Stock issuable
upon the  exercise  of the July  Placement  Warrant  and the July 1996  Warrants
issuable upon the exercise thereof,  has been registered for sale in the Selling
Securityholder  Prospectus.  See "Description of Securities Registration Rights"
and "Concurrent Offering."


REGISTRATION RIGHTS

           Currently, the holders of the Bridge Warrants, the July 1996 Warrants
and the Officer  Warrants,  as well as the holders of the shares of Common Stock
issued in the July 1996  Offering,  have  certain  rights  with  respect  to the
registration  of such shares and the Units and shares of Common  Stock  issuable
upon the exercise of such


                                      -59-

<PAGE>



warrants under the Securities Act. Under the terms of the agreements between the
Company and the holders of such registrable securities,  if the Company proposes
to register any of its securities  under the Securities  Act, either for its own
account or for the account of other  security  holders  exercising  registration
rights,  such  holders  are  entitled  to  notice of such  registration  and are
entitled  to include  shares of such  Common  Stock  therein.  The  stockholders
benefiting from these rights may also require the Company to file a registration
statement  under the  Securities Act at its expense with respect to their shares
of Common  Stock,  and the Company is required to use its best efforts to effect
such  registration.  All of these rights are subject to certain  conditions  and
limitations,  among them the right of the  underwriters  of an offering to limit
the number of shares included in such registration.

           The  holders  of the  Common  Stock  issuable  upon  exercise  of the
Placement  Agent's  Warrant  have  rights  similar  to  those  described  in the
preceding  paragraph.  In  addition,  the right to notice and  inclusion  in any
registration  statement  filed by the Company is  effective  until  November 11,
2001.  The right to demand the  registration  of the Common Stock  issuable upon
exercise of the  Placement  Agent's  Warrant  extends from  November 11, 1997 to
November  11,  2001.  The holders of the July  Placement  Warrants  have similar
registration rights,  except that the right to demand the registration of Common
Stock  issuable  upon  exercise  of the July  Placement  Warrants  extends  from
November 11, 1998 to November 11, 2001.

           The Units and  certain  of the  shares of  Common  Stock  subject  to
registration   rights  have  been  registered  in  the  Selling   Securityholder
Prospectus.  Certain of the Selling Securityholders have agreed not to sell such
shares for periods of nine or 12 months commencing November 12, 1996 without the
prior  consent of the  Underwriter.  See "Shares  Eligible  for Future Sale" and
"Concurrent Offering."


TRANSFER AGENT AND WARRANT AGENT

           Continental Stock Transfer & Trust Company, New York, New York is the
transfer agent and the Common Stock and Warrant Agent for the Class A Warrants.


DELAWARE TAKEOVER STATUTE AND CERTAIN CHARTER PROVISIONS

           The  Company  is  subject  to  Section  203 of the  Delaware  General
Corporation Law ("Section 203") which, subject to certain exceptions,  prohibits
a Delaware  corporation  from  engaging  in any  business  combination  with any
interested  stockholder for a period of three years following the date that such
stockholder  became an interested  stockholder,  unless: (i) prior to such date,
the  Board  of  Directors  of  the  corporation  approved  either  the  business
combination or the  transaction  which resulted in the  stockholder  becoming an
interested stockholder; (ii) upon consummation of the transaction which resulted
in  the  stockholder   becoming  an  interested   stockholder,   the  interested
stockholder  owned  at  least  85%  of  the  voting  stock  of  the  corporation
outstanding  at the time the  transaction  commenced,  excluding for purposes of
determining the number of shares  outstanding  those shares owned (x) by persons
who are  directors  and also  officers and (y) by employee  stock plans in which
employee participants do not have the right to determine  confidentially whether
shares held subject to the plan will be tendered in a tender or exchange  offer;
or (iii) on or subsequent to such date, the business  combination is approved by
the  Board of  Directors  and  authorized  at an annual or  special  meeting  of
stockholders, and not by written consent, by the affirmative vote of at least 66
2/3% of the  outstanding  voting  stock  which is not  owned  by the  interested
stockholder.

           In anticipation  of, and subject to completion of, the Offering,  the
stockholders  of the  Company  have  approved  an  amendment  to  the  Company's
Certificate of Incorporation which provides that the directors of the Company be
classified into two classes as nearly equal in size as possible,  with staggered
two-year terms. Assuming the initial public offering occurs in 1996, the initial
term of office  of the first  class of  directors  to expire at the 1997  Annual
Meeting of  Stockholders  and the initial  term of office of the second class of
directors to expire at the 1998 Annual  Meeting of  Stockholders.  The Company's
Certificate of Incorporation will further provide that vacancies on the Board of
Directors could be filled only with the approval of a majority of the Board


                                      -60-

<PAGE>



of  Directors  then  in  office.  Furthermore,   any  director  elected  by  the
stockholders,  or by the Board of Directors to fill a vacancy,  could be removed
only for cause and by a vote of 75% of the  combined  voting power of the shares
of Common  Stock  entitled to vote for the  election of  directors,  voting as a
single class.

           The Company's  Certificate of Incorporation  and Amended and Restated
Bylaws,  after the closing of an initial public offering,  will provide that any
action required or permitted to be taken by the  stockholders of the Company may
be taken only at a duly called  annual or special  meeting of the  stockholders.
These provisions,  if adopted,  could have the effect of delaying until the next
stockholders  meeting  stockholder actions which are favored by the holders of a
majority of the  outstanding  voting  securities  of the Company,  since special
meetings  of  stockholders  may be  called  only by (x) the  Board of  Directors
pursuant to a resolution adopted by a majority of the entire Board of Directors,
either upon motion of a director  or upon  written  request by the holders of at
least  50% of the  voting  power  of all the  shares  of  capital  stock  of the
Corporation then entitled to vote generally in the election of directors, voting
together  as a  single  class,  or (y)  the  chairman  or the  president  of the
Corporation.

           The foregoing  provisions,  which could be amended only by a 75% vote
of the  stockholders,  could have the effect of making it more  difficult  for a
third  party to effect a change in the  control  of the Board of  Directors.  In
addition, these provisions 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,  an interest in the Company which  constitutes  less than a majority of
the  outstanding  voting  stock of the  Company and may make more  difficult  or
discourage a takeover of the Company.


                         SHARES ELIGIBLE FOR FUTURE SALE

           Upon  completion of this  offering,  the Company will have  4,082,676
outstanding shares of Common Stock (assuming no exercise of outstanding  options
or warrants).  Of these shares, the 1,366,050 shares contained in the Units sold
to the public in the  Company's  initial  public  offering in November  1996 and
39,500 shares sold by certain Selling  Securityholders  since November 12, 1996,
are freely  tradeable  without  restrictions or further  registration  under the
Securities Act, except for any shares held by "affiliates" of the Company within
the  meaning  of the  Securities  Act,  which  will  be  subject  to the  resale
limitations  of Rule  144.  The  remaining  2,677,126  shares  held by  existing
stockholders were issued by the Company in private transactions in reliance upon
one or more exemptions under the Securities Act, are "restricted  securities" as
that term is defined in Rule 144 promulgated under the Securities Act and may be
sold in compliance with such Rule, pursuant to registration under the Securities
Act or pursuant  to an  exemption  therefrom.  Generally,  under Rule 144,  each
person holding  restricted  securities for a period of one year may, every three
months  after  such  one-year  holding  period,   sell  in  ordinary   brokerage
transactions or to market makers an amount of shares equal to the greater of one
percent of the Company's  then  outstanding  Common Stock or the average  weekly
trading  volume  during the four weeks prior to the proposed  sale. In addition,
sales  under  Rule  144  may  be  made  only   through   unsolicited   "broker's
transactions"  or  to  a  "market  maker"  and  are  subject  to  various  other
conditions.  The  limitation on the number of shares which may be sold under the
Rule and the  "broker's  transaction"  requirement  do not  apply to  restricted
securities  sold  for the  account  of a  person  who is not and has not been an
"affiliate" of the Company (as that term is defined in the Act) during the three
months prior to the proposed sale and who has beneficially  owned the securities
for at least two years.

           Under Rule 701 of the Securities Act,  employees who purchased shares
upon exercise of options granted prior to November 12, 1996 are entitled to sell
such  shares  after the 90th day  following  such date in  reliance on Rule 144,
without having to comply with the holding period  requirements  of Rule 144 and,
in the  case of  non-affiliates,  without  having  to  comply  with  the  public
information,  volume limitation or notice provisions of Rule 144. Affiliates are
subject to all Rule 144 restrictions  after this 90-day period,  but without the
Rule 144 holding period  requirement.  If all the  requirements  of Rule 701 are
met, an  aggregate  of 288,333  shares of Common  Stock  issuable on exercise of
outstanding  vested  stock  options  will be  tradeable  pursuant  to such rule,
subject to the lockup period  described  below.  Such options are exercisable at
prices below the initial public offering price of the Units.


                                      -61-

<PAGE>



           Sales of  substantial  amounts of Common  Stock  pursuant to Rule 144
could  subsequently  adversely  affect  the market  prices of the  Common  Stock
offered hereby. The Company's executive  officers,  David E. Y. Sarna and George
J. Febish,  and the Family Trusts have agreed not to sell or otherwise  transfer
any of their  securities  in the  Company  for a period of 18 months  commencing
November 12, 1996 without the prior written consent of the Underwriter, and they
have agreed with various state securities administrators not to sell (other than
in a pledge or  hypothecation)  any of their shares of Common Stock for a period
ending on the second anniversary of the execution date of the City Agreement. As
of the date of this Prospectus,  approximately 612,000 of the outstanding shares
of Common  Stock are  eligible  for sale under Rule 144,  and the balance of the
outstanding  shares  will become  eligible  for sale under Rule 144 from time to
time thereafter.  In addition,  concurrently with this offering,  the Company is
registering for resale by the Selling Securityholders 1,086,963 shares of Common
Stock and 412,500  Class A Warrants  that are  outstanding  or issuable upon the
exercise   of   currently   exercisable    warrants;    however,   the   Selling
Securityholders,  other than the  Underwriter  and certain other  holders,  have
agreed  not to sell  their  registered  securities  for a  period  of 12  months
commencing  November 12, 1996.  Furthermore,  certain  holders of the  Company's
outstanding  Common Stock,  warrants and options  (including  current and former
executive   officers)  have  "piggyback"   registration   rights  and/or  demand
registration  rights that they may  exercise  commencing  November 12, 1997 (but
commencing November 12, 1998 with respect to the July Placement  Warrants).  See
"Risk  Factors-Shares  Eligible  for  Future  Sale;  Effect on  Ability to Raise
Capital;  No Prior Public  Market for the Common Stock;  Possible  Volatility of
Common Stock Price" and "Concurrent Offering."


                               CONCURRENT OFFERING

           Concurrently  with the  Offering,  the  Company  has  registered  the
offering of 1,086,963 Selling Securityholder Shares and 412,500 Class A Warrants
under the Securities Act on behalf of the Selling Securityholders  pursuant to a
Selling Securityholder  Prospectus included within the Registration Statement of
which this Prospectus  forms a part. The Selling  Securityholder  Securities are
outstanding or issuable upon the exercise of immediately  exercisable  warrants.
The Selling Securityholders include the Underwriter with respect to 37,500 Units
issuable  upon the  exercise  of the  Placement  Agent's  Warrant.  The  Selling
Securityholder  Securities are not part of the underwritten  Offering,  however,
and, other than those held by the  Underwriter,  all the Selling  Securityholder
Securities  may not be sold  prior to the  expiration  of 12  months  commencing
November  12, 1996 without the prior  written  consent of the  Underwriter.  The
Company  will not  receive  any of the  proceeds  from  the sale of the  Selling
Securityholder  Securities,  but will receive the proceeds of the  exercise,  if
any, of the various  warrants  pursuant to which the shares of Common  Stock and
Class  A  Warrants   comprising   412,500   Units  and  270,837   other  Selling
Securityholder  Shares are  issuable.  It is  anticipated  that when the Selling
Securityholder  Securities are eligible for sale free of contractual restriction
described  above,  they  will  be  offered  and  sold  from  time to time in the
over-the-counter market, or otherwise, at prices and terms then prevailing or at
prices related to the then current market price, or in negotiated transactions.


                                  LEGAL MATTERS

           The validity of the securities  being offered hereby were passed upon
for the Company by Parker  Chapin  Flattau & Klimpl,  LLP,  New York,  New York.
Melvin Weinberg,  Esq., a partner of Parker Chapin Flattau & Klimpl, LLP, may be
deemed the beneficial owner of 300,000 shares of Common Stock as a result of his
being a trustee of each of the Family Trusts.


                                     EXPERTS

           The  financial  statements of the Company as at December 31, 1996 and
for each of the two years in the period then ended  included in this  Prospectus
have been so  included in reliance on the report of Richard A. Eisner & Company,
LLP,  independent  auditors,  given on the  authority of said firm as experts in
accounting and auditing.



                                      -62-

<PAGE>



                             ADDITIONAL INFORMATION

           The Company has filed with the Securities  and Exchange  Commission a
Registration  Statement  on Form SB-2  under the  Securities  Act of 1933,  with
respect to the Units offered hereby. This Prospectus 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 such
Units,  reference  is made to the  Registration  Statement  and the exhibits and
schedules thereto. Statements contained in this Prospectus as to the contents of
any contract or other document referred to herein are not necessarily  complete,
and,  in each  instance,  if such  contract  or  document  is an  exhibit to the
Registration Statement,  reference is made to the copy of such contract or other
document filed as an exhibit to the Registration Statement,  each such statement
being  qualified  in all  respects  by  such  reference  to  such  exhibit.  The
Registration  Statement,  including  exhibits  and  schedules  thereto,  may  be
inspected  without charge and copied at the public  reference  facilities of the
Commission at Room 1024,  450 Fifth Street,  N.W.,  Washington,  D.C. and at its
Regional Offices at 7 World Trade Center,  Suite 1300, New York, New York 10048,
and Citicorp  Center,  500 West Madison Street,  Suite 1400,  Chicago,  Illinois
60661,  and copies of such  material may be obtained  from the Public  Reference
Section of the Commission at 450 Fifth Street,  N.W.,  Washington,  D.C.  20549,
upon  payment  of  fees  at  rates  prescribed  by  the  Commission.  Electronic
registrations statements made through the Electronic Data Gathering Analysis and
Retrieval  ("EDGAR")  System are  publicly  available  through the  Commission's
Website (http://www.sec.gov).

           The Company will provide  without  charge to each person who receives
this  Prospectus,  upon written or oral request of such person, a copy of any of
the information that is incorporated by reference in this  Prospectus.  Any such
request  should  be  directed  to  the  attention  of the  Corporate  Secretary,
ObjectSoft Corporation, Continental Plaza III, 433 Hackensack Avenue, Hackensack
New Jersey 07601, telephone number (201) 343- 9100.





                                      -63-

<PAGE>



                          INDEX TO FINANCIAL STATEMENTS


REPORT OF INDEPENDENT AUDITORS.............................................F-2


BALANCE SHEET - AS AT DECEMBER 31, 1996....................................F-3


STATEMENTS OF OPERATIONS FOR THE YEARS ENDED
DECEMBER 31, 1996 AND DECEMBER 31, 1995....................................F-4


STATEMENTS OF CHANGES IN STOCKHOLDERS' EQUITY
(CAPITAL DEFICIENCY) FOR THE YEARS ENDED
DECEMBER 31, 1996 AND DECEMBER 31, 1995....................................F-5

STATEMENTS OF CASH FLOWS FOR THE YEARS ENDED
DECEMBER 31, 1996 AND DECEMBER 31, 1995....................................F-6

NOTES TO FINANCIAL STATEMENTS..............................................F-7

CONDENSED BALANCE SHEETS - AS AT JUNE 30, 1997 AND
DECEMBER 31, 1996.........................................................F-16

CONDENSED STATEMENTS OF OPERATIONS - THREE MONTHS
AND SIX MONTHS ENDED JUNE 30, 1997 AND 1996...............................F-17

CONDENSED STATEMENTS OF CASH FLOWS - THREE MONTHS
AND SIX MONTHS ENDED JUNE 30, 1997 AND 1996...............................F-18

NOTES TO CONDENSED FINANCIAL STATEMENTS...................................F-19


                                       F-1

<PAGE>



                         REPORT OF INDEPENDENT AUDITORS



To the Board of Directors and Stockholders
ObjectSoft Corporation


           We  have  audited  the  accompanying   balance  sheet  of  ObjectSoft
Corporation  as at December  31, 1996,  the related  statements  of  operations,
changes in stockholders'  equity (capital deficiency) and cash flows for each of
the years in the two-year  period  ended  December  31,  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 report.

           In our opinion,  the financial  statements  enumerated  above present
fairly,  in  all  material  respects,   the  financial  position  of  ObjectSoft
Corporation  as at December 31, 1996 and the results of its  operations and cash
flows for each of the years in the two-year  period ended  December 31, 1996, in
conformity with generally accepted accounting principles.



Ricahrd A. Eisner & Company, LLP


Florham Park, New Jersey
March 7, 1997




                                       F-2

<PAGE>



                             OBJECTSOFT CORPORATION

                                  BALANCE SHEET

                             AS AT DECEMBER 31, 1996


<TABLE>
<CAPTION>
                                   A S S E T S
                                   -----------
<S>                                                                         <C>
Current assets:
   Cash and cash equivalents (Notes A[9] and J[1]) ......................   $ 4,039,358
   Accounts receivable ..................................................         5,900
   Prepaid expenses and other current assets ............................       180,463
                                                                            -----------
          Total current assets ..........................................     4,225,721

Equipment, at cost, net of accumulated depreciation (Notes A[2], B and E)       457,848
Capitalized software (Notes A[5] and C) .................................       168,118
Other assets ............................................................       130,474
                                                                            -----------


          T O T A L .....................................................   $ 4,982,161
                                                                            ===========


                             L I A B I L I T I E S
                             ---------------------

Current liabilities:
Current portion of obligations under capital lease (Note E) .............   $    45,740
   Accounts payable .....................................................        57,309
   Accrued expenses .....................................................       101,872
   Other liabilities ....................................................         9,785
                                                                            -----------
          Total current liabilities .....................................       214,706
                                                                            -----------

Obligations under capital lease (Note E) ................................        38,335
                                                                            -----------

Commitments (Note K)


                              STOCKHOLDERS' EQUITY
                              --------------------
                                (Notes G and L)


Common stock, $.0001 par, authorized 20,000,000 shares,
issued and outstanding 4,022,676 shares .................................           402
Additional paid-in capital ..............................................     6,878,868
Accumulated deficit .....................................................    (2,150,150)
                                                                            -----------
          Total stockholders' equity ....................................     4,729,120
                                                                            -----------


          T O T A L .....................................................   $ 4,982,161
                                                                            ===========
</TABLE>

  The accompanying notes to financial statements are an integral part hereof.



                                       F-3

<PAGE>



                             OBJECTSOFT CORPORATION

                            STATEMENTS OF OPERATIONS



                                         Year Ended
                                        December 31,
                                --------------------------
                                    1996           1995
                                -----------    -----------
Revenues (Note J[2]):
   Consulting ...............   $   269,401    $   447,976

   Training .................        21,279        118,618

   Rental income (Note K[1])        150,450
                                -----------    -----------

         Total revenues .....       441,130        566,594
                                -----------    -----------


Expenses:
   Cost of services .........       424,336        429,604

   Research and development .        92,693         62,863

   General and administrative       834,960        193,025

   Interest .................       329,836          3,502
                                -----------    -----------

          Total expenses ....     1,681,825        688,994
                                -----------    -----------


NET (LOSS) ..................   $(1,240,695)   $  (122,400)
                                ===========    ===========


Net loss per share ..........   $     (0.45)   $     (0.05)
                                ===========    ===========

Weighted average number
   of shares outstanding ....     2,848,943      2,797,134
                                ===========    ===========



   The accompanying notes to financial statements are an integral part hereof.



                                       F-4

<PAGE>



                             OBJECTSOFT CORPORATION

       STATEMENTS OF CHANGES IN STOCKHOLDERS' EQUITY (CAPITAL DEFICIENCY)

                     YEARS ENDED DECEMBER 31, 1996 AND 1995

<TABLE>
<CAPTION>
                                                                                                  
                                                                                                  
                                                  Common Stock        Additional
                                          -------------------------    Paid-in  
                                             Shares       Amount        Capital       (Deficit)        Total
                                          -----------   -----------   -----------    -----------    -----------
<S>                                         <C>         <C>           <C>            <C>            <C>         
Balance, January 1, 1995 ..............     2,275,000   $       228   $   255,332    $  (735,879)   $  (480,319)

Accretion of dividends on the Series A
  Preferred Stock .....................          --            --            --          (19,125)       (19,125)

Series B preferred stock issuance costs
  (Note F) ............................          --            --          (2,500)          --           (2,500)

Common Stock issued, net of costs .....        18,000             1        15,499           --           15,500

Compensatory option granted (Note .....        10,000          --          10,000
G[3])

Net loss ..............................          --            --            --         (122,400)      (122,400)
                                          -----------   -----------   -----------    -----------    -----------

Balance, December 31, 1995 ............     2,293,000           229       278,331       (877,404)      (598,844)

Warrants issued in connection with
  bridge loan, net of costs (Note D) ..          --            --         123,525           --          123,525

Compensatory warrants granted
  (Note G[3]) .........................          --            --          16,000           --           16,000

Dividends declared ....................          --            --            --          (32,051)       (32,051)

Units issued, net of costs (Note G[2])      1,639,051           164     6,279,771           --        6,279,935

Exercise of warrants (Note G[3]) ......        90,625             9       181,241           --          181,250

Net loss ..............................          --            --            --       (1,240,695)    (1,240,695)
                                          -----------   -----------   -----------    -----------    -----------

BALANCE, DECEMBER 31, 1996 ............     4,022,676   $       402   $ 6,878,868    $(2,150,150)   $ 4,729,120
                                          ===========   ===========   ===========    ===========    ===========
</TABLE>


   The accompanying notes to financial statements are an integral part hereof.


                                       F-5

<PAGE>



                             OBJECTSOFT CORPORATION
                            STATEMENTS OF CASH FLOWS

<TABLE>
<CAPTION>
                                                                              Year Ended
                                                                             December 31,
                                                                     --------------------------
                                                                         1996           1995
                                                                     -----------    -----------
<S>                                                                  <C>            <C>         
Cash flows from operating activities:
   Net (loss) ....................................................   $(1,240,695)   $  (122,400)
   Adjustments to reconcile net loss to net cash provided by
     (used in) operating activities:
       Depreciation and amortization .............................       174,699         58,056
       Amortization of discount on note payable ..................       268,525           --
       Provision (recovery) for doubtful accounts ................       (16,200)        16,200
       Stock options issued for services rendered ................        16,000         10,000
       Changes in operating assets and liabilities:
         (Increase) decrease in:
           Accounts receivable ...................................        82,902         67,091
           Prepaid expenses and other current assets .............      (153,884)         6,311
           Other assets ..........................................       (94,875)        34,587
         Increase (decrease) in:
           Accounts payable ......................................        (1,005)       (48,332)
           Accrued expenses ......................................         7,617        (28,574)
           Accrued officer compensation ..........................      (391,687)       107,220
           Other liabilities .....................................         8,169           --
                                                                     -----------    -----------
             Net cash provided by (used in) operating activities .    (1,340,434)       100,159
                                                                     -----------    -----------
Cash flow from investing activities:
   Capital expenditures ..........................................      (419,096)          --
   Capitalized software and courseware ...........................      (137,904)      (118,478)
                                                                     -----------    -----------
             Net cash (used in) investing activities .............      (557,000)      (118,478)
                                                                     -----------    -----------
Cash flow from financing activities:
   Proceeds from issuance of preferred and common stock ..........       113,000
   Proceeds from issuance of warrants - bridge units .............       123,525           --
   Proceeds from note payable ....................................       981,475           --
   Repayment of note payable .....................................    (1,250,000)          --
   Deferred offering costs .......................................       (30,250)
   Proceeds from issuance of common stock and warrants ...........     6,279,935           --
   Dividends .....................................................       (32,051)          --
   Proceeds from exercise of warrants ............................       181,250           --
   Principal payments on obligations under capital leases ........       (27,431)        (7,928)
   Redemption of preferred stock .................................      (383,906)          --
                                                                     -----------    -----------
             Net cash provided by financing activities ...........     5,872,797         74,822
                                                                     -----------    -----------

NET INCREASE IN CASH .............................................     3,975,363         56,503

Cash, beginning of period ........................................        63,995          7,492
                                                                     -----------    -----------

CASH, END OF PERIOD ..............................................   $ 4,039,358    $    63,995
                                                                     ===========    ===========
Supplemental disclosures of cash flow Cash paid during the period:
     Interest expense ............................................   $    61,311    $     3,502
</TABLE>


   The accompanying notes to financial statements are an integral part hereof.



                                       F-6

<PAGE>


                             OBJECTSOFT CORPORATION

                          NOTES TO FINANCIAL STATEMENTS





(NOTE A) - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES:
- ------------------------------------------------------

           [1]        The Company:

                      ObjectSoft   Corporation   (the  "Company")  is  currently
engaged  in the  business  of  providing  transaction  based  services  over the
Internet and through kiosks, computer software training and consulting.

           [2]        Equipment:

                      Equipment   is   carried   at   cost,   less   accumulated
depreciation.  Depreciation  is  provided  using the  straight-line  method over
estimated useful lives of the assets (three to seven years).

           [3]        Provision for income taxes:

                      Deferred  income  taxes arise from  temporary  differences
resulting  primarily  from income and expense items being reported on an accrual
basis for  financial  reporting  purposes and on a cash basis for tax  purposes,
capitalized  software  and net  operating  loss  carryforwards.  The Company has
available at December 31, 1996,  Federal net  operating  loss  carryforwards  of
approximately  $2,200,000  which may be applied  against  future  taxable income
through 2011.

           [4]        Software revenue recognition policies:

                      The  Company  is  engaged  as a  developer  in a number of
software  transactions.  Generally,  revenue from generic software is recognized
upon delivery of the software. After the sale, if significant obligations remain
or significant  uncertainties  exist about customer  acceptance of the software,
revenue is deferred until the obligations are satisfied or the uncertainties are
resolved.  Revenue  from  software  services is  recognized  as the services are
performed.  Revenue from software  leased  through the Internet  (generally  one
year) is  deferred  and  amortized  over the lease  term.  Revenue  from  custom
software  development  (included in consulting revenue) is recognized based upon
its percentage completion.

           [5]        Software development costs:

                      The Company  capitalizes  software  development costs when
project technological feasibility is established and concluding when the project
is ready for  release.  Research  and  development  costs  related  to  software
development are expensed as incurred.

                      The Company's policy is to amortize  capitalized  software
costs by the greater of (a) the ratio that current gross  revenues for a product
bears to the total of current and  anticipated  future  gross  revenues for that
product or (b) the straight-line  method over the remaining  estimated  economic
life of the product  including  the period being  reported on. It is  reasonably
possible  that  those  estimates  of  anticipated  future  gross  revenues,  the
remaining  economic  useful  life of the  product or both will be reduced in the
near term.

           [6]        Use of estimates:

                      The preparation of financial statements in conformity with
generally accepted  accounting  principles requires management to make estimates
and assumptions  that affect the reported  amounts of assets and liabilities and
disclosure of  contingent  assets and  liabilities  at the date of the financial
statements and the


                                       F-7

<PAGE>


                             OBJECTSOFT CORPORATION

                          NOTES TO FINANCIAL STATEMENTS




(NOTE A) - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES:  -- (CONTINUED)
- ----------------------------------------------------------------------

reported  amounts of revenue and expenses  during the reporting  period.  Actual
results could differ from those estimates.

           [7]        Stock-based compensation:

                      Statement  of  Financial  Accounting  Standards  No.  123,
"Accounting for Stock-Based  Compensation"  ("SFAS No. 123") allows companies to
either  expense  the  estimated  fair value of stock  options or to  continue to
follow the intrinsic  value method set forth in APB Opinion 25,  "Accounting for
Stock Issued to Employees"  ("APB 25") but disclose the pro forma effects on net
(loss) had the fair value of the options been expensed.  The Company has elected
to continue to apply APB 25 in accounting for its stock option  incentive plans.
See Note G[3] to the financial statements for further information.

           [8]        Net loss per share:

                      Net loss per  share  was  computed  based on the  weighted
average number of shares of common stock  outstanding  during the period and the
net loss increased by the dividends accruing on the cumulative  preferred stock.
Since,  in 1995 and prior to November 13, 1996,  certain  shares of common stock
and common stock  equivalents  were issued and, in accordance with certain rules
of the  Securities  and Exchange  Commission all such shares of common stock and
common stock  equivalents were considered  outstanding for 1995 and through June
30,  1996.  Fully  diluted  net loss per  share is not  shown  since it would be
anti-dilutive.

                      During 1996, the Company issued units consisting of common
stock and warrants (see Note D) and utilized  $125,000 of the proceeds to redeem
the Series B preferred  stock.  Additionally,  the Company redeemed the Series A
preferred  stock and  repaid  the short  term  debt with the  proceeds  from the
initial public  offering.  Had the Series A preferred been retired on January 1,
1995, the Series B preferred  stock not been issued on December 31, 1995 nor the
short  term debt  initiated  in 1996 and had the  Company  issued  common  stock
instead,  the net loss per share  for the  years  ended  December  31,  1996 and
December 31, 1995 would have been $(0.31) and ($0.04), respectively.  These loss
per share  computations  assume an additional  weighted average number of shares
outstanding  for the years  ended  December  31, 1996 and  December  31, 1995 of
173,834 and 43,367, respectively.

           [9]        Cash and cash equivalents:

                      Cash and cash  equivalents  include  cash on hand,  demand
deposits and all  highly-liquid  investments  with a maturity of three months or
less at the time of purchase.




                                       F-8

<PAGE>


                             OBJECTSOFT CORPORATION

                          NOTES TO FINANCIAL STATEMENTS

(NOTE B) - EQUIPMENT:
- ---------------------

           At December 31, 1996, equipment consists of:

                     Kiosks...................................    $407,131
                     Equipment................................     179,323
                                                                  --------
                                                                   586,454
                     Accumulated depreciation.................     128,606
                                                                  --------

                                  T o t a l...................    $457,848
                                                                   =======

           Depreciation  expense  aggregated  $83,587  and $19,573 for the years
ended December 31, 1996 and 1995, respectively. Included in depreciation expense
is  depreciation  expense on  equipment  under  capital  lease which  aggregated
$14,920  and  $8,396,   for  the  years  ended   December  31,  1996  and  1995,
respectively.

           During 1996,  the Company  acquired  equipment  under  capital  lease
aggregating $98,906.

(NOTE C) - CAPITALIZED SOFTWARE:
- --------------------------------

           During the years ended  December 31, 1996 and December 31, 1995,  the
Company has capitalized software development costs which aggregated $137,904 and
$118,478,  respectively.  Amortization of capitalized  software costs aggregated
$78,392 and $9,873 for the years ended  December 31, 1996 and December 31, 1995,
respectively.   Additionally   amortization  of  capitalized   courseware  costs
aggregated  $12,720  and  $28,610  for the years  ended  December  31,  1996 and
December 31, 1995, respectively.

(NOTE D) - FINANCING:
- ---------------------

           In 1996,  prior to the IPO, the Company sold 12.5 bridge units,  each
consisting  of a $100,000,  7% note and  warrants to purchase  30,000  shares of
common stock or other  securities as might be offered in the Company's IPO ("IPO
Securities").  Additionally,  the placement agent received a warrant to purchase
37,500  shares of common  stock or other  securities  as might be offered in the
Company's IPO. The notes were paid in full on November 22, 1996.

           The Company valued the warrants at $138,750. Accordingly,  additional
paid-in  capital has been credited  $123,525  which  represents the value of the
warrants less the allocable  portion of the offering costs.  The short-term note
was discounted by the value of the warrants and the offering costs. The discount
was  amortized  as  additional  interest  expense  from the date of  issuance to
November 22, 1996,  the date the note was paid in full. The IPO was completed in
November 1996; the bridge unit warrants are exercisable  into the IPO Securities
at $3.50 per unit.  These warrants  expire in November 1999. The placement agent
warrants are exercisable at $4.55 and expire in November 2001.

           During the year ended  December  31,  1996,  amortization  aggregated
$268,525.




                                       F-9

<PAGE>


                             OBJECTSOFT CORPORATION

                          NOTES TO FINANCIAL STATEMENTS

(NOTE E) - OBLIGATIONS UNDER CAPITAL LEASE:
- -------------------------------------------

           Minimum future lease payments under capital leases  expiring  through
2001, as of December 31, 1996 are as follows:

           Year Ending
           December 31,                                   Amount

               1997...................................     $  57,676
               1998...................................        30,933
               1999...................................         6,723
               2000...................................         5,080
               2001...................................         2,193
                                                           ---------
                                                             102,605
           Less amount representing interest..........        18,530
                                                           ---------

           Present value of net minimum
             lease payments...........................       84,075
           Less present value of net minimum
             lease payments due within one year.......        45,740
                                                           ---------

                               T o t a l..............     $  38,335
                                                           =========


(NOTE F) - PREFERRED STOCK:
- ---------------------------

           The Series A 9% cumulative voting preferred stock was redeemed at the
time of the initial  public  offering  for a total of $212,500  plus  cumulative
dividends of $71,214.

           The Series B 10% cumulative  preferred stock was redeemed at the time
of the private  placement for a total of $125,000 and warrants expiring November
13, 1999 to purchase 20,000 shares of common stock at an exercise price of $7.00
per share. Dividends paid in 1996 aggregated $7,243.

(NOTE G) - STOCKHOLDERS' EQUITY:
- --------------------------------

           [1]        Recapitalization:

                      In  January  1996,  ObjectSoft  Corporation,  a New Jersey
corporation merged into a newly formed corporation,  ObjectSoft  Corporation,  a
Delaware  corporation.  In conjunction with the merger,  shares of the preferred
and common stock  outstanding  were  exchanged  for the same number of shares of
stock,  the shares  authorized  increased to 5,000,000  preferred and 20,000,000
common  and the par value was  reduced  to  $.0001.  This  transaction  is given
retroactive effect in the accompanying financial statements.

           [2]        Private placement and initial public offerings:

                      In  August  1996,   the  Company   issued   273,001  units
consisting of one share of common stock and a warrant to purchase  two-thirds of
a share of common stock at an exercise price of $3.00 per two-thirds  share. The
Company  received  proceeds  of  $816,285,  net of offering  costs of  $139,215.
Additionally, the


                                      F-10

<PAGE>


                             OBJECTSOFT CORPORATION

                          NOTES TO FINANCIAL STATEMENTS




(NOTE G) - STOCKHOLDERS' EQUITY: (CONTINUED)
- --------------------------------------------

placement  agent was granted  warrants  to purchase  27,300 of these units at an
exercise price of $4.50 per unit. The warrants expire November 13, 1999.

                      In November  1996,  the Company  issued  1,366,050  units,
consisting  of one share of common  stock and a warrant to purchase one share of
common stock at an exercise price of $6.50 per share expiring November 2001. The
Company received proceeds of $5,463,650 net of offering costs of $1,366,600.  In
connection  with the IPO,  the  underwriter  was  granted an option to  purchase
87,500 units at $8.00 per unit.

           [3]        Stock options and warrants:

                      As of January 1, 1995,  the Company  had issued  warrants,
expiring  in April  1998,  to  purchase  143,333  shares of  common  stock at an
exercise  price of $0.50 and  warrants,  expiring in November  1996, to purchase
106,250 shares of common stock at an exercise price of $2.00. In 1996,  warrants
to purchase 90,625 shares of common stock were  exercised.  Warrants to purchase
15,625 shares of common stock expired.

                      In 1995, the Company granted an option to purchase 100,000
shares of common stock at $1.00 per share in exchange for  consulting  services.
The options are exercisable  through September 2000. In 1996, in exchange for an
additional $5,000 payment to the option holder, the Company cancelled the option
on 50,000 shares.

                      In 1996, the Company  granted a warrant to purchase 10,000
shares  of  common  stock  at  $1.00  per  share  in  exchange  for  $20,000  of
professional  services to be rendered  during the vesting  period.  This warrant
vests  ratably  over a ten month  period  ending  March 1997 and is  exercisable
through May 2001.  During 1996,  the Company  recognized  expense of $16,000 and
warrants to purchase 8,000 shares of common stock were vested as of December 31,
1996.

                      In addition, the Company adopted a stock option plan under
which 250,000  shares of common stock are reserved for issuance upon exercise of
either incentive or nonincentive stock options which may be granted from time to
time by the Board of Directors to employees and others.

                      Other  than the  warrants  to  purchase  90,625  shares of
common stock, no other options or warrants were exercised in 1995 or 1996.

                      The  Company  applies APB 25 in  accounting  for its stock
option incentive plan and, accordingly,  recognizes compensation expense for the
difference  between the fair value of the underlying  common stock and the grant
price of the option at the date of grant. The effect of applying SFAS No. 123 on
1996 pro forma net loss as stated above is not necessarily representative of the
effects on reported net loss for future years due to, among other things (1) the
vesting  period of the stock options and the (2) fair value of additional  stock
options in future years.  Had  compensation  cost for the Company's stock option
plans  been  determined  based  upon the fair value at the grant date for awards
under the plans  consistent with the methodology  prescribed under SFAS No. 123,
the  Company's  net loss in 1996 would have been  approximately  $1.4 million or
$(0.50) per share. The weighted average fair value of the options granted during
1996  are  estimated  as  $1.20  per  share  on the  date  of  grant  using  the
Black-Scholes  option-pricing  model with the  following  assumptions:  dividend
yield 0%, volatility of 40%,  risk-free interest rate of 6.37% and expected life
of 5 years.



                                      F-11

<PAGE>


                             OBJECTSOFT CORPORATION

                          NOTES TO FINANCIAL STATEMENTS




(NOTE G) - STOCKHOLDERS' EQUITY: (CONTINUED)
- --------------------------------------------

           During 1996,  the Company  granted  options on 145,000  shares of its
common  stock at an average  exercise  price of $3.43.  No options  were  either
exercised or forfeited during the year.

           The following table summarizes  information  about the plan's options
outstanding at December 31, 1996:


                              Options Outstanding           Options Exercisable 
                  -----------------------------------    -----------------------
                                 Weighted              
                                  Average              
                                 Remaining   Weighted                  Weighted
   Range of                     Contractual  Average                   Average
   Exercise         Number         Life      Exercise       Number     Exercise
    Prices        Outstanding   (In Years)    Price      Exercisable    Price
                  ------------  -----------  --------    -----------  ----------
$2.50 to $3.50      145,000         5.0       $3.43        129,999      $3.42
                                                     

           The Company has  reserved  2,961,887  shares of its common  stock for
issuance upon exercise of the outstanding warrants and options.

(NOTE H) - INCOME TAXES:
- ------------------------

           The significant  components of the Company's  deferred tax assets and
liabilities at December 31, 1996 as follows:


           Accrual to cash adjustment.....................   $  (52,000)
           Capitalized software...........................      (65,000)
           Net operating losses carryforward..............      909,000
           Valuation allowance............................     (792,000)
                                                             ----------

           Net deferred tax asset.........................   $        0
                                                             ==========

           The significant components of the provision for income taxes consists
of the following:

                                                         December 31,
                                                         ------------
                                                     1996           1995
                                                     ----           ----

           Accrual to cash adjustment...........$ (255,000)     $  62,000
           Net operating loss carryforward......   764,000         37,000
           Capitalized software.................   (28,000)       (35,000)
           Increase in valuation allowance......  (481,000)       (64,000)
                                                ----------       --------
           Provision for income taxes...........$        0      $       0
                                                ==========      =========



                                      F-12

<PAGE>


                             OBJECTSOFT CORPORATION

                          NOTES TO FINANCIAL STATEMENTS




(NOTE H) - INCOME TAXES: (CONTINUED)
- ------------------------------------

           The difference  between the statutory  federal income tax rate on the
Company's net loss and the Company's  effective  income tax rate for each of the
year ended December 31, 1996 and 1995, respectively, is summarized as follows:

                                                           December 31,
                                                           ------------
                                                        1996          1995
                                                        ----          ----

           Statutory federal income tax rate......      34.0%         34.0%
           Increase in valuation allowance........     (38.8)        (39.2)
           Research and development credit........       0.9           7.3
           Miscellaneous..........................       3.9          (2.1)
                                                     --------      --------
           Effective income tax rate..............       0.0%          0.0%
                                                     ========      ========


(NOTE I) - EMPLOYEE BENEFIT PLAN:
- ---------------------------------

           The Company  maintains a  noncontributory  Employee  Savings Plan, in
accordance  with the  provisions  of Section 401 of the Internal  Revenue  Code.
Pursuant  to the terms of the plan,  participants  can defer a portion  of their
income through contributions to the Plan.


(NOTE J) - FINANCIAL INSTRUMENTS, REVENUES AND OTHER MATTERS:
- -------------------------------------------------------------

           [1]        Cash:

                      Financial   instruments  which  potentially   subject  the
Company  to  concentrations  of credit  risk are  primarily  cash.  The  Company
maintains  its cash in a highly  rated  financial  institution.  At December 31,
1996,  the Company  had bank  deposits  exceeding  Federally  insured  limits by
approximately $4,000,000.

           [2]        Revenues:

                      For the years ended  December  31, 1996 and  December  31,
1995, 71 percent and 48 percent, respectively, of revenues were derived from two
customers.

           [3]        Microsoft Corporation:

                      The Company's  software is generally  based upon Microsoft
Windows technology.  Additionally,  it has established a strategic  relationship
with Microsoft that management believes is important to its sales, marketing and
support  and product  development  activities.  Accordingly,  any change in this
relationship  or any factor  adversely  affecting the demand for, or the use of,
Microsoft's  Windows operating system could have a negative impact on demand for
the Company's  products and services.  Additionally,  changes to the  underlying
components  of  the  Windows  operating  system  would  require  changes  to the
Company's  products and could result in the loss of sales if the Company did not
implement changes in a timely manner.


                                      F-13

<PAGE>


                             OBJECTSOFT CORPORATION

                          NOTES TO FINANCIAL STATEMENTS

(NOTE K) - COMMITMENTS:
- -----------------------

           [1]        Lease income:

                      In 1995,  the Company  entered into an agreement  with the
City of New York ("New York") whereby the Company would develop custom  software
and upon  final  acceptance  of the  software  by New  York,  the  Company  will
initially  lease five  kiosks,  hardware  and software to New York for one year,
renewable  by New York for two  successive  one year  terms.  The annual  rental
aggregates  $361,080.  Additionally,  the  Company  can earn fees based upon the
number of transactions  effectuated in the kiosks. The remaining rent receivable
at December 31, 1996 under this agreement is $210,630.

           [2]        Lease:

                      The  Company  leases  office  space  and  equipment  under
operating  leases  with an  initial  or  remaining  term of more  than  one year
expiring through 2003.

           Year Ending
           December 31,                                  Amount
           ------------                                  ------

           1997....................................    $ 58,008
           1998....................................      77,822
           1999....................................      80,494
           2000....................................      84,787
           2001....................................      89,080
           Thereafter..............................     116,984
                                                       --------

                T o t a l..........................    $507,175
                                                       ========


                      Rent expense  approximated  $62,500 and  $18,300,  for the
years ended December 31, 1996 and December 31, 1995, respectively.

           [3]        Employment agreements:

                      The Company  entered into  employment  agreements with two
key executives expiring in December 2001. Under the terms of the agreements, the
aggregate initial annual  compensation is $208,000 per executive.  Additionally,
the agreements include provisions for bonuses  (aggregating the sum of 5 percent
of earnings before  depreciation,  interest,  taxes and  amortization  and other
amounts,  if any, to be  determined  by the board of  directors),  increases  in
compensation and severance payment based upon certain events.


(NOTE L) - SUBSEQUENT EVENT:
- ----------------------------

           In January  1997,  with the approval of the board of  directors,  the
Company loaned $440,000 to the Company's  chairman of the board.  The loan which
is unsecured,  bears  interest at 8% per annum and is due in November  1997. The
chairman of the board used the proceeds for a block purchase of 80,000 shares of
the Company's  common stock from the market maker,  who was also the underwriter
of the Company's IPO, in an open market transaction.


                                      F-14

<PAGE>

                             OBJECTSOFT CORPORATION

         CONDENSED BALANCE SHEETS -- JUNE 30, 1997 AND DECEMBER 31, 1996
                                   (UNAUDITED)

<TABLE>
<CAPTION>
                                                                  June 30,     December 31,
                                                                    1997           1996
                                                                -----------    -----------
<S>                                                             <C>            <C>        
ASSETS
Current assets:
   Cash and cash equivalents ................................   $    16,020    $ 4,039,358
   Marketable securities ....................................     2,123,982
   Accounts receivable ......................................       201,769          5,900
   Notes and loan receivable- officer shareholder ...........       440,000
   Loan receivable - InteractiVisions, Inc. .................       100,000
   Prepaid expenses and other current assets ................       144,074        180,463
                                                                -----------    -----------
   Total current assets .....................................     3,025,845      4,225,721
Equipment, at cost, net of accumulated depreciation .........       449,219        457,848
Capitalized software ........................................       128,134        168,118
Other assets ................................................       100,685        130,474
                                                                -----------    -----------
TOTAL .......................................................   $ 3,703,883    $ 4,982,161
                                                                ===========    ===========

LIABILITIES
Current liabilities
   Current portion of obligations under capitalized leases ..   $    46,779    $    45,740
   Accounts payable .........................................       131,228         57,309
   Accrued liabilities ......................................        87,171        101,872
   Other current liabilities ................................        12,981          9,785
                                                                -----------    -----------
Total current liabilities ...................................       278,159        214,706
                                                                -----------    -----------

Obligations under capitalized leases ........................        14,008         38,335
                                                                -----------    -----------

STOCKHOLDERS' EQUITY
Common Stock, $.0001 par value; authorized 20,000,000 shares;
   issued and outstanding 4,081,676 shares as of June 30,
   1997 and 4,022,676 of December 31, 1996 ..................           408            402
Additional paid-in capital ..................................     6,941,862      6,878,868
Accumulated deficit .........................................    (3,530,554)    (2,150,150)
                                                                -----------    -----------

   Total stockholders' equity ...............................     3,411,716      4,729,120
                                                                -----------    -----------

T O T A L ...................................................   $ 3,703,883    $ 4,982,161
                                                                ===========    ===========
</TABLE>


                                      F-15

<PAGE>


                             OBJECTSOFT CORPORATION

                       CONDENSED STATEMENTS OF OPERATIONS
                  FOR THE THREE MONTHS AND THE SIX MONTHS ENDED
                         JUNE 30, 1997 AND JUNE 30, 1996
                                   (UNAUDITED)

<TABLE>
<CAPTION>
                                     Three Months Ended           Six Months Ended
                                 --------------------------    --------------------------
                                   June 30        June 30        June 30        June 30
                                    1997           1996           1997           1996
                                 -----------    -----------    -----------    -----------
<S>                              <C>            <C>            <C>            <C>        
Revenues:
    Consulting ...............   $    61,872    $   166,069    $   109,401    $   258,000
    Development and training .        14,556         37,954
    Rental income ............        90,270           --          180,540           --
    Investment income ........        48,546           --           84,672           --
                                 -----------    -----------    -----------    -----------

   Total revenues ............       200,688        180,625        374,613        295,954
                                 -----------    -----------    -----------    -----------

Expenses:
    Cost of Services .........       170,343        138,247        396,481        173,467
    Research and development .       188,993           --          287,608           --
    General and administrative       495,883        186,628        913,960        332,413
    Interest expense .........         3,248         90,346          6,968         90,796
    Provision for loss on loan
      receivable .............       150,000           --          150,000           --
                                 -----------    -----------    -----------    -----------

   Total expenses ............     1,008,467        415,221      1,755,017        596,676
                                 -----------    -----------    -----------    -----------

NET (LOSS) ...................   ($  807,779)   ($  234,596)   ($1,380,404)   ($  300,722)
                                 -----------    -----------    -----------    -----------

NET (LOSS) PER SHARE .........   ($     0.20)   ($     0.08)   ($     0.34)   ($     0.11)
                                 ===========    ===========    ===========    ===========

WEIGHTED AVERAGE
  NUMBER OF SHARES
   OUTSTANDING ...............     4,065,632      2,800,734      4,050,952      2,800,734
                                 ===========    ===========    ===========    ===========
</TABLE>


                                      F-16

<PAGE>


                             OBJECTSOFT CORPORATION

                       CONDENSED STATEMENTS OF CASH FLOWS
     FOR THE SIX MONTHS ENDED JUNE 30, 1997 AND JUNE 30, 1996 - (UNAUDITED)

<TABLE>
<CAPTION>
                                                                        1997           1996
                                                                    -----------    -----------
<S>                                                                  <C>           <C>         
Cash flows from operating activities:
Net (loss) ......................................................    (1,380,404)   ($  300,722)
Adjustments to reconcile net loss to net cash (used in) operating
activities:
    Depreciation and amortization ...............................       159,665         52,719
    Amortization of discount on note payable ....................          --           77,263
    Provision for doubtful accounts .............................          --            9,000
    Provision for loss on loan receivable .......................       150,000           --
    Stock options issued for services rendered ..................         4,000          4,000
    Changes in operating assets and liabilities:
    (Increase) in accounts receivable ...........................      (195,869)      (137,795)
    Decrease in prepaid expenses and other current assets .......        36,389         14,159
    (Increase) decrease in other assets .........................        29,789         (8,961)
    Increase in accounts payable ................................        73,919         92,680
    (Decrease) in accrued expenses and other liabilities ........       (11,505)       (28,914)
    (Decrease) in accrued officer compensation ..................          --         (200,000)
                                                                    -----------    -----------
Net cash used in operating activities ...........................    (1,134,016)      (426,571)
                                                                    -----------    -----------

Cash flow from investing activities:
Capital expenditures ............................................       (83,890)      (126,258)
Capitalized software and courseware .............................       (27,162)      (109,684)
Investment in marketable securities .............................    (2,123,982)          --
Loan receivable Interactivisions, Inc. ..........................      (250,000)          --
Increase in notes receivable officer shareholder ................      (440,000)          --
                                                                    -----------    -----------
Net cash (used in) investing activities .........................    (2,925,034)      (235,942)
                                                                    -----------    -----------

Cash flow from financing activities
Proceeds from note payable ......................................          --          981,475
Dividends .......................................................          --           (3,125)
Deferred offering costs .........................................          --          (74,036)
Proceeds from issuance of warrants ..............................          --          123,525
Proceeds from exercise of warrants and issuance of 59,000 shares         59,000           --
Principal payments on obligations under  capital leases .........       (23,288)        (5,262)
                                                                    -----------    -----------

Net cash provided by financing activities .......................        35,712      1,022,577
                                                                    -----------    -----------
NET INCREASE (DECREASE) IN CASH .................................    (4,023,338)       360,064
Cash, beginning of period .......................................     4,039,358         63,995
                                                                    -----------    -----------
Cash, end of period .............................................   $    16,020    $   424,059
                                                                    ===========    ===========
SUPPLEMENTAL DISCLOSURE OF CASH FLOW
INFORMATION
Interest expense paid ...........................................   $     3,248    $     1,512
                                                                    ===========    ===========
</TABLE>

                                      F-17

<PAGE>


                             OBJECTSOFT CORPORATION

               NOTES TO CONDENSED FINANCIAL STATEMENTS (UNAUDITED)


NOTE A -- BASIS OF PRESENTATION

     The  accompanying   unaudited  condensed  financial  statements  have  been
prepared in accordance with generally accepted accounting principles for interim
financial  information,  the  instructions  to Form  10-QSB  and item  310(b) of
Regulation  SB.  Accordingly,  they  do not  include  all  the  information  and
footnotes  required by generally  accepted  accounting  principles  for complete
financial statements. In the opinion of management,  all adjustments (consisting
of normal recurring  accruals)  considered  necessary for fair presentation have
been included.  For further  information,  refer to the Financial Statements and
footnotes  thereto  included  in  the  Company's   Registration   Statement  and
Prospectus  and Form 10-KSB (for the year ended December 31, 1996) as filed with
the Securities and Exchange Commission.

NOTE B -- LOSS PER SHARE

     The loss per  share  amounts  in the  statement  of  operations  have  been
computed in accordance with a Staff Accounting  Bulletin (SAB) of the Securities
and Exchange Commission.  According to the SAB, common stock and common warrants
issued are to be treated as common stock equivalents outstanding for all periods
presented if such common  stock was issued or such common stock  warrants may be
exercised,  at a price  substantially  below the public offering price. Net loss
per share was computed based on the weighted  average number of shares of common
stock outstanding during the period and the net loss for the period ending March
31, 1996 was increased by dividends accruing on the cumulative  preferred stock.
Prior to November  13,  1996,  certain  shares of common  stock and common stock
equivalents  were issued and in accordance  with certain rules of the Securities
and  Exchange  Commission  all such  shares of common  stock  and  common  stock
equivalents were considered outstanding through June 30, 1996. Fully diluted net
loss share is not shown since it would be anti-dilutive.

NOTE C -- NOTES AND LOAN RECEIVABLE OFFICER SHAREHOLDER

     In January 1997,  with the approval of the board of directors,  the Company
loaned  $440,000  to the  Company's  chairman  of the  board.  The loan which is
unsecured,  bears  interest  at 8% per annum and is due in  November  1997.  The
chairman of the board used the proceeds for a block purchase of 80,000 shares of
the Company's  common stock from the market maker,  who was also the underwriter
of the  Company's  IPO, in an open market  transaction.  In February  1997,  the
Company  loaned the chairman of the board an additional  $197,500  under similar
terms. The latter loan was repaid in June, 1997.



                                      F-18

<PAGE>


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

                  SUBJECT TO COMPLETION, DATED OCTOBER 14, 1997

                              ALTERNATE PROSPECTUS

                             OBJECTSOFT CORPORATION


          1,086,963 Shares of Common Stock and 412,500 Class A Warrants
                     issuable upon the exercise of Warrants

           This Prospectus  relates to (i) 1,086,963 shares of the common stock,
par value $.0001 per share (the "Common Stock"), of ObjectSoft  Corporation (the
"Company") and (ii) 412,500  Redeemable Class A Warrant (the "Class A Warrants")
of  the  Company.  Such  shares  of  Common  Stock  and  Class  A  Warrants  are
collectively referred to herein as the "Selling Securityholder  Securities," and
the  holders  of  the  Selling   Securityholder   Securities  and  the  warrants
exercisable   for  certain  of  the  Selling   Securityholder   Securities   are
collectively  referred to herein as the "Selling  Securityholders."  The 412,500
Class A Warrants and 412,500 of the shares of Common Stock are issuable,  in the
form of units (the "Units"),  each Unit  consisting of one share of Common Stock
and one Class A Warrant. The Units are issuable upon the exercise of (1) 375,000
warrants (the "Bridge  Warrants")  issued to investors in a private placement by
the Company in April through  June,  1996 (the "Bridge Loan  Offering")  and (2)
37,500 warrants  issued to Renaissance  Financial  Securities  Corporation ( the
"Underwriter")  in its capacity as placement  agent of the Bridge Loan  Offering
(the "Placement Agent's  Warrant").  Of the other 674,463 shares of Common Stock
to which  this  Prospectus  is  related,  (1)  273,001  shares  are  issued  and
outstanding  and were issued to investors in a private  placement by the Company
in July and August  1996 (the  "July 1996  Offering"),  (2)  182,004  shares are
issuable upon the exercise of warrants  issued to the investors in the July 1996
Offering ( the "July 1996  Warrants"),  (3) 45,500  shares are issuable upon the
exercise of a warrant  (and the July 1996  Warrants  issuable  upon the exercise
thereof)  issued to Win Capital  Corporation  ("Win Capital") in its capacity as
placement  agent of the July 1996 Offering (the "July Placement  Warrant"),  (4)
43,333 shares are issuable upon the exercise of warrants  originally issued to a
former  executive  officer of the Company (the "Officer  Warrants"),  (5) 90,625
shares  are  held by  certain  investors  in  connection  with  certain  private
placements in 1992 and 1993 (the "Investor  Shares"),  and (6) 40,000 shares are
held by certain stockholders of the Company.  See "Selling  Securityholders" and
"Plan of Distribution."  Certain of the Selling  Securityholders (other than the
Underwriter) have agreed not to sell any Selling Securityholder Securities for a
period of 12 months  commencing  November  12, 1996  without  the prior  written
consent of the Underwriter with respect to the Company's initial public offering
in November 1996 (the  "Offering").  See "Plan of Distribution"  and "Concurrent
Public Offering."

           The shares of Common  Stock and Class A Warrants  that  comprise  the
Units are  immediately  detachable  and  separately  transferable.  Each Class A
Warrant  entitles the holder thereof to purchase one share of Common Stock at an
exercise price of $6.50 per share, subject to adjustment, at any time commencing
November 11, 1997 until  November 11, 2001.  The Class A Warrants are redeemable
by the Company at a price of $.10 per Class A Warrant  commencing one year after
the  date  of  this  Prospectus  (or  earlier  with  the  prior  consent  of the
Underwriter),  on not less than 30 days  prior  written  notice  to the  holders
thereof,  provided  the average  closing bid  quotation  of the Common  Stock as
reported on the NASDAQ SmallCap Market ("NASDAQ"),  if traded thereon, or if not
traded thereon,  the average closing bid quotation of the Common Stock if listed
on a national  securities exchange (or other reporting system that provides last
sale prices),  has been at least 130% of the then current  exercise price of the
Class A Warrants  (initially,  $8.45 per share),  for a period of 20 consecutive
trading days ending within 15 days of the date on which the Company gives notice
of  redemption.  The Class A  Warrants  will be  exercisable  until the close of
business on the day immediately preceding the date fixed for redemption.
See  "Description of Securities - Class A Warrants."

           The Selling  Securityholder  Securities may be sold from time to time
by the Selling Securityholders or by their transferees.  The distribution of the
Selling Securityholder Securities by the Selling Securityholders may be effected
in one or more transactions that may take place on the over-the-counter  market,
including ordinary


                                       A-1

<PAGE>



brokers' transactions, privately negotiated transactions or through sales to one
or more dealers for resale of such  securities as  principals,  at market prices
prevailing  at the time of sale,  at prices  related to such  prevailing  market
prices or at negotiated prices.  Usual and customary or specifically  negotiated
brokerage fees or commissions may be paid by the Selling  Securityholders.  Then
Selling  Securityholders  may, but are not  obligated  to,  effect  transactions
through or to the Underwriter.

           The Selling  Securityholders,  and  intermediaries  through whom such
securities  are sold,  may be deemed  underwriters  within  the  meaning  of the
Securities  Act of 1933 (the  "Securities  Act") with respect to the  securities
offered,  and  any  profits  realized  or  commissions  received  may be  deemed
underwriting  compensation.  The  Company  has agreed to  indemnify  the Selling
Securityholders  against certain  liabilities,  including  liabilities under the
Securities Act.

           The Company will not receive any of the proceeds from the sale of the
Selling Securityholder  Securities by the Selling Securityholders.  In the event
the  Placement  Agent's  Warrant  and all of the Bridge  Warrants  and the other
warrants  exercisable  to acquire  shares of Common Stock are exercised in full,
the  Company  will  receive   gross   proceeds  of   $5,226,685.   See  "Selling
Securityholders" and "Plan of Distribution."

           On the  date of this  Prospectus,  a post  effective  amendment  to a
registration  statement under the Securities Act with respect to the offering by
the Company of 1,366,050  shares of Common Stock and 1,366,050 Class A Warrants,
was  declared   effective  by  the  Securities  and  Exchange   Commission  (the
"Commission"). See "Concurrent Public Offering."

           AN INVESTMENT IN THESE SECURITIES INVOLVES A HIGH DEGREE OF RISK. See
"Risk Factors" immediately following the "Prospectus Summary" section.

            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.

                THE DATE OF THIS PROSPECTUS IS ___________, 1997



                                       A-2

<PAGE>



                           [ALTERNATE PROSPECTUS PAGE]



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

Prospectus Summary...........................................................
Risk Factors.................................................................
Use of Proceeds..............................................................
Dividend Policy..............................................................
Capitalization...............................................................
Dilution.....................................................................
Selected Financial Data......................................................
Management's Discussion and Analysis of Financial Condition
 and Results of Operations...................................................
Glossary.....................................................................
Business.....................................................................
Management...................................................................
Principal Stockholders.......................................................
Certain Transactions.........................................................
Description of Securities....................................................
Shares Eligible for Future Sale..............................................
Selling Securityholders......................................................
Plan of Distribution.........................................................
Underwriting.................................................................
Concurrent Public Offering...................................................
Legal Matters................................................................
Experts......................................................................
Additional Information.......................................................
Index to Financial Statements................................................F-1

           The  Company  is  subject  to  the  reporting   requirements  of  the
Securities  Exchange  Act of 1934  (the  "Exchange  Act"),  and,  in  accordance
therewith, files reports, proxy and information statements and other information
with the Securities and Exchange  Commission (the  "Commission").  Such reports,
proxy and  information  statements  and other  information  can be inspected and
copied at the Public Reference Section of the Commission at Room 1024, Judiciary
Plaza,  450 Fifth  Street,  N.W.,  Washington,  D.C.  20549 and at the following
regional  offices:  New York Regional Office,  Suite 1300, 7 World Trade Center,
New York, New York 10048, and Chicago Regional Office,  500 West Madison Street,
Suite 1400, Chicago,  Illinois 60661-2511,  and copies of such material may also
be  obtained  by mail from the Public  Reference  Section of the  Commission  at
prescribed rates.  Electronic registration statements made though the Electronic
Data Gathering  Analysis and Retrieval  ("EDGAR") System are publicly  available
through the Commission's Website (http://www.sec.gov).
See "Additional Information."

The Company intends to furnish its stockholders  with annual reports  containing
audited  financial  statements  and such  other  reports  as the  Company  deems
appropriate or as may be required by law.

ObjectSoft(TM),  SmartStreet(TM),  SmartSign(TM), OLEBroker(TM), and CafeOLE(TM)
are trademarks of the Company.  This Prospectus  also includes other  trademarks
and trade names of the Company and trademarks,  service marks and trade names of
other companies,  including  ActiveX(TM),  a trademark of Microsoft  Corporation
("Microsoft").




                                       A-3

<PAGE>



                           [ALTERNATE PROSPECTUS PAGE]

                             SELLING SECURITYHOLDERS

           Up to an aggregate  of  1,086,963  shares of Common Stock and 412,500
Class A Warrants may be offered for resale by the Selling  Securityholders.  The
Class A Warrants and 412,500  shares of Common Stock are issuable in the form of
412,500  immediately  separable  Units upon the exercise of the Bridge  Warrants
issued to  investors  in the Bridge  Loan  Offering  and the  Placement  Agent's
Warrant.  Of the other 690,088  Selling  Securityholder  shares of Common Stock,
273,001  shares are issued and  outstanding  and were issued to investors in the
July 1996  Offering,  182,004  shares are issuable upon the exercise of the July
1996  Warrants,  45,500  shares  are  issuable  upon  the  exercise  of the July
Placement  Warrant  (and the  July  1996  Warrants  issuable  upon the  exercise
thereof),  90,625 Investor Shares are held by certain  investors,  43,333 shares
are issuable upon exercise of the Officer Warrants and 90,000 shares are held by
certain stockholders of the Company.

           The following  table sets forth certain  information  with respect to
each  Selling  Securityholder  for  whom  the  Company  is  registering  Selling
Securityholder Securities for resale to the public. The Company will not receive
any of the proceeds from the sale of such securities.  Renaissance  acted as the
Underwriter of the  Underwriters  of the Company's  initial  public  offering in
November,  1996. A principal of Win Capital is also a principal of Cyndel & Co.,
Inc.,  a principal  stockholder  of the Company.  Other than as  described  with
respect to Renaissance and Win Capital, to the Company's knowledge, there are no
material  relationships  between  any of the  Selling  Securityholders  and  the
Company, nor have any such material  relationships existed within the past three
years.

           Other than Renaissance,  which owns the Unit Purchase Option, and the
holders of the Investor Shares and Officer Warrants,  no Selling  Securityholder
currently owns  securities of the Company other than the Selling  Securityholder
Securities  or  warrants   exercisable   to  purchase   Selling   Securityholder
Securities. Assuming all of the Selling Securityholder Securities are issued and
sold, and based on the securities of the Company  currently owned by the Selling
Securityholders,  no Selling  Securityholder,  with the  possible  exception  of
Renaissance, will beneficially own 1% or more of the Company's Common Stock.

                                              MAXIMUM         MAXIMUM NUMBER OF
                                             NUMBER OF        CLASS A WARRANTS
    BRIDGE OFFERING                    SHARES TO BE SOLD (1)   TO BE SOLD (1)
    ---------------                    ---------------------  ----------------

Renaissance Financial Securities Corporation    37,500(2)           37,500(2)
Nathan Eisen                                     7,500               7,500
Richard, Steven and Kenneth Etra                15,000              15,000
William J. Ludwig                               15,000              15,000
Joseph W. And Ann G. Schantz                     7,500               7,500
Gregg Gallant                                    7,500               7,500
Mary and Mark Albritton                         15,000              15,000
Sydney Katz                                      7,500               7,500
Louis Falletta                                   7,500               7,500
Phillip Levien                                   7,500               7,500
Pamda Retirement Trust                          15,000              15,000
Eric W. Larson                                  15,000              15,000
HRIS Associates, Inc.                           15,000              15,000
Program Advisors Corporation                     7,500               7,500
Program Resource Organization, Inc.              7,500               7,500
Association of Independent Employers, Ltd.       7,500               7,500
Peter S. Morford                                 7,500               7,500
Robert E. Coomes                                 7,500               7,500
Gary G. Hammon                                   7,500               7,500


                                       A-4

<PAGE>

                                              MAXIMUM         MAXIMUM NUMBER OF
                                             NUMBER OF        CLASS A WARRANTS
    BRIDGE OFFERING                    SHARES TO BE SOLD (1)   TO BE SOLD (1)
    ---------------                    ---------------------  ----------------

Sheldon Sisken                                   7,500               7,500
Abraham David                                    7,500               7,500
Bay N. Sayegh                                    7,500               7,500
American Waste Oil Services Corp.               15,000              15,000
Gastro Enterology Associates                    30,000              30,000
Servesting Investment Co.                        7,500               7,500
Martin Hodas                                    15,000              15,000
Richard Someck                                  15,000              15,000
Roger Testa                                     30,000              30,000
Cyril J. Galagan                                15,000              15,000
Jack P. Conlon                                  15,000              15,000
Joseph Schanne and Theresa Schanne              15,000              15,000
Anthony Quaranta                                15,000              15,000
                                               -------             -------
               TOTAL                           412,500             412,500
               -----                           =======             =======



                                       A-5

<PAGE>



                           [ALTERNATE PROSPECTUS PAGE]



                                                              MAXIMUM NUMBER
                                                            OF SHARES ISSUABLE
                                                            ON EXERCISE OF JULY
                                        MAXIMUM NUMBER OF   1996 WARRANTS TO BE
JULY 1996 OFFERING                      SHARES TO BE SOLD          SOLD
- ------------------                      -----------------   -------------------
Win Capital Corporation (3)                  27,300              18,200
Lawrence Dell Aquila                          3,572               2,381
David Barron                                 10,000               6,667
Louis Chapman and Elaine Chapman              3,000               2,000
Michael Damiani and Beverly Damiani           5,000               3,333
Seymour Fertig                                7,143               4,762
Theodore Kaplan & Selma Kaplan                8,000               5,334
Edgar Lindblom                               10,000               6,667
Thomas J. Luisi                               9,000               6,000
Donald Markowitz                             12,000               8,000
Gary O'Leary                                 10,000               6,667
PAMCO General Contracting Corp.               5,000               3,334
Pension Solutions                            10,000               6,667
Nicholas Ponzio                               7,143               4,762
Jeffrey Reizner                               5,000               3,334
Samuel Richman                                3,000               2,000
Charles Ruppman                              25,000              16,667
Rose Salvato                                 16,000              10,667
James R. Smith                               22,000              14,667
John H. Smith                                 5,000               3,333
Stourbridge Investment Ltd.                  62,143              41,429
Suan Investments Inc.                        30,000              20,000
Faye Zelmanovicz                              5,000               3,333
                                              -----               -----
                       TOTAL                300,301             200,204
                       -----                =======             =======
                                                               
                                                               
                                                               
                                                               
                                                               
                                       A-6
                                                             
<PAGE>


                           [ALTERNATE PROSPECTUS PAGE]



                                                       MAXIMUM
                                                      NUMBER OF     SHARES OWNED
                                                    SHARES TO BE     AFTER THE
      HOLDERS OF INVESTOR SHARES                        SOLD          OFFERING
      --------------------------                        ----          --------

Harold Greenberg                                        3,125          6,250
Gennaro P. Vanacore                                     3,125          6,250
Harmat Capital Corp.                                    3,125          6,250
Greenberg Associates                                    3,125          6,250
Jon Farbman                                             6,250         12,500
Scott Berman                                            6,250         12,500
George Mourges                                         12,500         25,000
Agamemnon R. Mourges                                   12,500         25,000
Marshall N. Cyrlin                                      6,250         12,500
Herbert Cyrlin                                          6,250         12,500
Josephine Chast                                         3,125          6,250
John P. Philis and Peter S. Philis, JTWROS              6,250         12,500
Elogeanne Grossman                                      3,125          6,250
Anthony Larosa                                          3,125          6,250
Catherine A. Lavin                                      6,250         12,500
Daniel Shapiro                                          3,125          6,250
Jerome Braunstein                                       3,125          6,250
                                                      -------        -------
               TOTAL INVESTOR WARRANTS                 90,625        181,250
                                                      =======        =======
           TOTAL SHARES OWNED AFTER OFFERING                      
                                                                  
                                                                  
                                                                  
                                                                  
                                                                  
OFFICER WARRANT HOLDERS                                           
Alice F. Wein                                          21,666              0
Arthur Wein                                            21,667              0
Arthur Wein and Alice F. Wein, JTWROS                    --           75,000
                                                      -------        -------
                 TOTAL OFFICER WARRANTS                43,333         75,000
            TOTAL SHARES OWNED AFTER OFFERING         =======        =======
                                                                  
                                                               

                                       A-7

<PAGE>


                           [ALTERNATE PROSPECTUS PAGE]


                                                               MAXIMUM
                                                              NUMBER OF
                                                            SHARES TO BE
              OUTSTANDING SHARES                                SOLD
              ------------------                                ----

Goldman Zolotorofe & Corcoran, P.C.                            20,000
Aaron Lehmann                                                  18,000
Sylvia Bageac                                                   2,000

                            TOTAL SHARES                       40,000
                                                               ======
- ----------

(1)  Except as to  Renaissance,  as  described  in note (2) below,  consists  of
     Common  Stock and  Class A  Warrants  comprising  Units  issuable  upon the
     exercise  of the  Bridge  Warrants.  See  "Certain  Transactions  -  Recent
     Financings."

(2)  Consists of Common  Stock and Class A Warrants  comprising  Units  issuable
     upon the  exercise  of the  Placement  Agent's  Warrant.  Does not  include
     125,000 shares of Common Stock included in the Units (and issuable upon the
     exercise of the Class A Warrants contained in such Units) issuable upon the
     exercise of the  Underwriter's  Unit Purchase  Option,  which option is not
     exercisable   until  November  11,  1997.   Assuming  all  of  the  Selling
     Securityholder Securities are issued and sold and no other shares of Common
     Stock  are  issued  (upon  the  exercise  of any  Class A  Warrants,  other
     outstanding options and warrants or otherwise) by the Company,  Renaissance
     by virtue of its ownership of the Underwriter's Unit Purchase Option,  will
     be deemed to own,  as of  September  13,  1997,  approximately  5.2% of the
     Company's Common Stock. See "Certain  Transactions - Recent Financings" and
     "Concurrent Public Offering."

(3)  Consists of shares issuable upon the exercise of the July Placement Warrant
     and upon the exercise July 1996 Warrants issuable upon such exercise of the
     July Placement Warrant. Does not include 222,500 shares of Common Stock and
     immediately  exercisable warrants to purchase 20,000 shares of Common Stock
     owned by Cyndel. See "Principal  Stockholders" and "Certain  Transactions -
     Recent Financings."





                                       A-8

<PAGE>


                           [ALTERNATE PROSPECTUS PAGE]

                              PLAN OF DISTRIBUTION

           The sale of the  Selling  Securityholder  Securities  by the  Selling
Securityholders  may be effected  from time to time in  transactions  (which may
include block transactions by or for the amount of the Selling  Securityholders)
in the  over-the-counter  market  or in  negotiated  transactions,  through  the
writing of options on the  securities,  a combination of such methods of sale or
otherwise.  Sales may be made at fixed  prices  which may be changed,  at market
prices prevailing at the time of sale or at negotiated prices.

           The Selling  Securityholders  may effect such transactions by selling
their securities directly to purchasers, through broker-dealers acting as agents
for the Selling  Securityholders or to broker-dealers who may purchase shares as
principals  and  thereafter  sell  the  securities  from  time  to  time  in the
over-the-counter   market  in  negotiated   transactions   or  otherwise.   Such
broker-dealers,  if any,  may  receive  compensation  in the form of  discounts,
concessions or commissions  from the Selling  Securityholders  or the purchasers
for whom  such  broker-dealers  may act as  agents  or to whom  they may sell as
principals or otherwise (which compensation as to a particular broker-dealer may
exceed  customary  commissions).  The Selling  Securityholders  may, but are not
obligated to, effect transaction through or to Renaissance.

           Each Selling  Securityholder has (other than Renaissance)  agreed not
to sell,  transfer or otherwise  dispose publicly of the Selling  Securityholder
Securities  for a period of 12 months after  November 12, 1996 without the prior
written consent of Renaissance in its capacity as Underwriter.

           Under applicable rules and regulations under the Securities  Exchange
Act of 1934  ("Exchange  Act"),  any person engaged in the  distribution  of the
Selling  Securityholder  Warrants may not simultaneously engage in market making
activities  with respect to any  securities of the Company during the applicable
"cooling-off"  period (at least two, and possibly nine,  business days) prior to
the  commencement  of  such  distribution.   Accordingly,   in  the  event  that
Renaissance is engaged in a distribution of Selling  Securityholder  Securities,
it will not be able to make a market  in the  Company's  securities  during  the
applicable restrictive period. In addition, each Selling Securityholder desiring
to sell  Selling  Securityholder  Securities  will be subject to the  applicable
provisions  of the  Exchange  Act  and the  rules  and  regulations  thereunder,
including  without  limitation,  provisions  which may  limit the  timing of the
purchases  and sales of  shares  of the  Company's  securities  by such  Selling
Securityholders.

           The Selling  Securityholders  and  broker-dealers,  if any, acting in
connection with such sale might be deemed to be underwriters  within the meaning
of Section 2(11) of the Securities  Act and any commission  received by them and
any profit on the resale of the  securities  might be deemed to be  underwriting
discounts and commissions under the Securities Act.


                           CONCURRENT PUBLIC OFFERING

           On the date of this Prospectus, a Registration Statement was declared
effective under the Securities Act with respect to an offering by the Company of
1,366,050 shares of Common Stock and 1,366,050 Class A Warrants by the Company.

           Renaissance,  a Selling  Securityholder,  acted as Underwriter of the
Underwriters of the Company's initial public offering in November,  1996 and, in
connection  therewith,  was granted an option (the  "Underwriter's Unit Purchase
Option") to purchase  up to 87,500  Units at an exercise  price equal to 160% of
the initial  public  offering  price of the Units sold in the Company's  initial
public  offering in November,  1996. The Class A Warrants  included in the Units
issuable upon the exercise of the Underwriter's Unit Purchase Option will not be
redeemable by the Company and will be  exercisable  at a price an exercise price
of $10.40.




                                       A-9

<PAGE>



                                     PART II
                     INFORMATION NOT REQUIRED IN PROSPECTUS

ITEM 24.   INDEMNIFICATION OF DIRECTORS AND OFFICERS.

           Section 145 of the General  Corporation  Law of the State of Delaware
(the "DECL.") provides,  in general,  that a Delaware  corporation may indemnify
any  person  who was or is a party  or is  threatened  to be made a party to any
threatened,  pending or  completed  action,  suit or  proceeding  (other  than a
derivative  action by or in the right of the corporation ) by reason of the fact
that  such  person  is or was a  director,  officer,  employee  or  agent of the
corporation,  or is or was  serving  at the  request  of  the  corporation  as a
director,  officer,  employee or agent of another  enterprise,  against expenses
(including  attorneys'  fees),  judgments,  fines and amounts paid in settlement
actually and reasonably  incurred by such person in connection with such action,
suit or  proceeding  if such  person  acted in good  faith and in a manner  such
person reasonably  believed to be in or not opposed to the best interests of the
corporation,  and,  with respect to any criminal  action or  proceeding,  had no
reasonable cause to believe such person's conduct was unlawful. In the case of a
derivative action, a Delaware  corporation may indemnify any such person against
expenses  (including  attorneys' fees) actually and reasonably  incurred by such
person in  connection  with the defense or  settlement of such action or suit if
such person acted in good faith and in a manner such person reasonably  believed
to be in or not opposed to the best interests of the corporation, except that no
indemnification  shall be made in respect  of any  claim,  issue or matter as to
which such person shall have been  adjudicated  to be liable to the  corporation
unless  and only to the  extent  that  the  Court of  Chancery  of the  State of
Delaware  or any other  court in which such  action is brought  determines  such
person is fairly and reasonably entitled to indemnity for such expenses. Article
Ninth of the  Company's  Certificate  of  Incorporation  and  Article  VI of the
Company's  Amended and Restated  Bylaws provide that the Company shall indemnify
all persons whom the Company shall have power to indemnify under such Section to
the fullest extent permitted by such Section. In addition, Article Eighth of the
Company's Certificate of Incorporation provides, in general, that no director of
the Company shall be personally  liable to the Company or its  stockholders  for
monetary  damages  for  breach  of  fiduciary  duty as a  director,  except  for
liability (i) for any breach of the director's duty of loyalty to the Company or
its stockholders,  (ii) for acts or omissions not in good faith or which involve
intentional misconduct or a knowing violation of law, (iii) under Section 174 of
the DECL.  (which provides that, under certain  circumstances,  directors may be
jointly and  severally  liable for willful or negligent  violations of the DECL.
provisions   regarding  the  payment  of  dividends  or  stock   repurchases  or
redemptions),  or (iv) for any  transaction  from which the director  derived an
improper personal benefit.

           Section 5 of the  Underwriting  Agreement  (Exhibit 1.1) provides for
indemnification by the underwriter of directors, officers and controlling person
of the Company for certain liabilities,  including certain liabilities under the
Securities Act of 1933, under certain circumstances.

ITEM 25.  OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION.

The expenses of the offering, other than underwriting discounts and commissions,
 are as follows:
Securities and Exchange Commission registration fee................  $        0
NASD filing fee....................................................           0
Legal fees and expenses*...........................................      20,000
Accounting fees and expenses*......................................      10,000
Blue sky fees and expenses (including counsel fees)*...............       5,000
Printing and engraving expenses*...................................       5,000
Miscellaneous*.....................................................       5,000
                                                                     ----------
     Total.........................................................  $   45,000
                                                                     ==========
- --------------------

*  Estimated




                                     II - 1

<PAGE>



ITEM 26.  RECENT SALES OF UNREGISTERED SECURITIES.

           The  following  sets forth  certain  information  regarding  sales of
securities  of the Company  issued  within the past three years,  which were not
registered pursuant to the Securities Act of 1933 (the "Securities Act").

           On  August  22,  1995  the  Company  granted  Benjamin  Borneman,   a
consultant  to the  Company,  the right to exchange  his right to cash  payments
under his retainer  agreement  for an option to acquire up to 100,000  shares of
Common Stock at an exercise price of $1.00 per share and up to 240,000 shares of
Common Stock at an exercise price of $2.00 per share.  On September 15, 1995 Mr.
Borneman  exercised his right to receive the option for 100,000 shares of Common
Stock at an exercise price of $1.00 per share expiring on the fifth  anniversary
of the date of grant. This option is immediately  exercisable;  however,  in May
1996,  the option was canceled as to 50,000  shares in  consideration  of a cash
payment of $5,000.  Mr. Borneman's right to acquire an option for 240,000 shares
of Common  Stock  expired on  December  31,  1995.  The  options  were issued in
reliance on the  exemption  from  registration  provided by Section  4(2) of the
Securities  Act. On February 20 and March 9, 1997, the Company issued 20,000 and
30,000 shares,  respectively  to Mr. Borneman upon his exercise of the option to
purchase  50,000  shares of Common Stock and the  underlying  shares were issued
pursuant to Rule 701 under the Act.

           On December 29, 1995,  the Company issued to Cyndel & Co., Inc. 1,250
shares  of  Preferred  Stock  to be  designated  Series  B  Preferred  Stock  in
consideration of $100,000 in cash and a promissory note in the amount of $25,000
due on January 30, 1996. The securities were issued in reliance on the exemption
from registration provided by Section 4(2) of the Securities Act.

           On December  28, 1995,  the Company  issued to Aaron  Lehmann  18,000
shares of Common Stock in consideration of $18,000 in cash. No sales commissions
were paid in  connection  with such  offerings.  The  securities  were issued in
reliance on the  exemption  from  registration  provided by Section  4(2) of the
Securities Act.

           During the period  April  through  June 1996,  the Company  sold 12.5
Bridge Units to accredited investors,  each Bridge Unit consisting of a $100,000
7% Note (the "Bridge  Notes") and warrants to purchase 30,000 Units identical to
the Units offered in the Company's  initial  public  offering.  The Bridge Notes
were repaid in full in November, 1996. The Bridge Warrants are exercisable at an
exercise price of $3.50 until November, 1999. In connection with the Bridge Loan
Offering,  the Company  sold to the  Underwriter,  in its  capacity as Placement
Agent of such offering,  a warrant (the "Placement Agent's Warrant") to purchase
a number of Units equal to 10% of Units issuable upon the exercise of the Bridge
Warrants  contained in the Bridge  Units.  The exercise  price of the  Placement
Agent's Warrant is [$5.00]  exercisable at any time until November 15, 2001. The
securities were issued in reliance on the exemptions from registration  provided
by Rule 506 of Regulation D  promulgated  under the  Securities  Act and Section
4(2) of the Securities Act.

           In July and August 1996, the Company sold , to accredited  investors,
an  aggregate  of 273,001  units (the "July 1996  Units")  for an  aggregate  of
$955,504, or $3.50 per July 1996 Unit. Each July 1996 Unit consists of one share
of Common Stock and a warrant (the "July 1996 Warrants") to purchase  two-thirds
(2/3) of a share of Common Stock at an exercise price of $3.00 per 2/3 share (or
$4.50 per share).  The July 1996  Warrants are  exercisable  until  November 12,
1999. In connection  with the sale of the July 1996 Units,  the placement  agent
for such sale, Win Capital Corporation, was granted a warrant to purchase 27,300
July 1996  Units at an  exercise  price of $4.50  per July 1996 Unit (the  "July
Placement  Warrant").  The securities  were issued in reliance on the exemptions
from  registration  provided by Rule 506 of Regulation D  promulgated  under the
Securities Act and Section 4(2) of the Securities Act.

           In July  1996,  the  Company  redeemed  the 1,250  shares of Series B
Preferred Stock held by Cyndel & Co., Inc. and in connection  therewith,  issued
to Cyndel  warrants  exercisable for a period of three years, to purchase 20,000
shares of Common Stock at an exercise  price of $7.00 per share.  The securities
were issued in reliance on the exemption from  registration  provided by Section
4(2) of the Securities Act.


                                     II - 2

<PAGE>



           On May 7, 1996,  the  Company  issued a warrant to Morton  Getman,  a
consultant  to the  Company,  for 10,000  shares of Common  Stock.  The warrants
granted  to Mr.  Getman  vested  at the rate of 1,000  per  month  and have been
exercised at a price of $1.00 per share.

           On February  20, 1997 and August 11, 1997,  the Company  issued 9,000
and  1,000  shares,  respectively,  to Mr.  Getman,  upon  the  exercise  of the
above-mentioned warrants.





                                     II - 3

<PAGE>



ITEM 27.  EXHIBITS.

           The  following  exhibits  are  filed  as part  of  this  registration
statement:

Exhibit Number                     Description
- --------------                     -----------

1.1            Form of Underwriting Agreement. (4)
2.1            Certificate of Ownership and Merger of ObjectSoft  Corporation (a
               New Jersey corporation) into the Company. (1)
2.2            Plan  of  Merger  of   ObjectSoft   Corporation   (a  New  Jersey
               corporation) into the Company. (1)
3.1(a)         Certificate of Incorporation of the Company. (1)
3.1(b)         Form of Amendment to Certificate of Incorporation of the Company,
               to be filed with the Secretary of State of Delaware preceding the
               closing of the Offering (2)
3.2(a)         By-laws of the Company. (1)
3.2(b)         Form of Amended and  Restated  Bylaws of the  Company,  to become
               effective upon closing of the Offering. (2)
4.1            Form of Underwriter's Unit Purchase Option Agreement.
4.2            Specimen Certificate of the Company's Common Stock (2)
4.3            Form of  Class A  Warrant  Agreement,  including  form of Class A
               Warrant. (1)
5.1            Opinion of Parker Chapin Flattau & Klimpl, LLP as to the legality
               of securities being registered. (3)
10.1           Employment Agreement dated as of July 1, 1996 between the Company
               and David E.Y. Sarna. (2)
10.2           Employment Agreement dated as of July 1, 1996 between the Company
               and George J. Febish. (2)
10.3           1996 Stock Option Plan. (1)
10.4           Form of Bridge Loan Promissory Note. (1)
10.5           Form of Bridge Loan Warrant. (1)
10.6           Form of Warrant  Agreement with  placement  agent for Bridge Loan
               Offering. (1)
10.7           Form of Subscription  Agreement and Investment  Representation of
               Investor  with each of the  investors in the July 1996  Offering.
               (1)
10.8           Form of July 1996 Warrant Agreement. (1)
10.9           Form of  Warrant  Agreement  with  placement  agent for July 1996
               Offering. (1)
10.10          Agreement,  dated January 11, 1996, as amended,  with the City of
               New   York    (Department   of    Information    Technology   and
               Telecommunications). (1)
10.11          Cooperation Agreement with Microsoft Corporation,  dated November
               7, 1995. (2)
10.12          Agreement with ACORD Corporation dated July 5,1995. (2)
10.13          Form of Investor Warrant. (2)
10.14          Form of Officer Warrant. (2)
10.16          Cyndel Warrant (2)
23.1           Consent of Richard A. Eisner & Company, LLP.(5)
23.2           Consent of Parker Chapin  Flattau & Klimpl,  LLP (included in the
               their opinion filed as Exhibit 5.1).
24.1           Power of Attorney. (1)
99.1           Consent of Gunther L. Less. (3)
- ------------------

(1)        Filed with initial filing of Registration Statement.
(2)        Filed with Amendment No. 1.
(3)        Filed with Amendment No. 2.
(4)        Filed with Amendment No. 3
(5)        Filed herewith.




                                     II - 4

<PAGE>



ITEM 28.  UNDERTAKINGS.

           The Company hereby undertakes that it will:

           (1)        For  determining any liability under the Securities Act of
1933 (the "Act"),  treat the  information  omitted  from the form of  prospectus
filed as part of this  registration  statement  in  reliance  upon Rule 430A and
contained  in a form  of  prospectus  filed  by the  Company  pursuant  to  Rule
424(b)(1) or (4) or 497(h) under the Act as part of this registration  statement
as of the time the Commission declared it effective;

           (2)        For  determining  any liability  under the Act, treat each
post-effective   amendment   that  contains  a  form  of  prospectus  as  a  new
registration statement for the securities offered in the registration statement,
and the  offering  of such  securities  at that  time as the  initial  bona fide
offering of those securities.

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

           The Company hereby undertakes:

           (1)        To file,  during any  period in which  offers or sales are
being made, a post-effective amendment to this registration statement;

           (i)        To include any prospectus  required by Section 10(a)(3) of
the Securities Act of 1933;

           (ii)       To reflect in the  prospectus  any facts or events arising
after the date of the registration  statement (or the most recent post-effective
amendment  thereof)  which,  individually  or  in  the  aggregate,  represent  a
fundamental  change in the information set forth in the registration  statement.
Notwithstanding the foregoing,  any increase or decrease in volume of securities
offered (if the total dollar value of  securities  offered would not exceed that
which  was  registered)  and any  deviation  from  the  low or  high  and of the
estimated  maximum  offering  range may be reflected  in the form of  prospectus
filed with the  Commission  pursuant  to Rule 424(b) if, in the  aggregate,  the
changes in volume  and price  represent  no more than 20  percent  change in the
maximum  aggregate  offering price set forth in the "Calculation of Registration
Fee" table in the effective registration statement.

           (iii)      To include any  material  information  with respect to the
plan of distribution not previously  disclosed in the registration  statement or
any material change to such information in the registration statement;

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

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


                                     II - 5

<PAGE>



                                   SIGNATURES


           In accordance  with the  requirements  of the Securities Act of 1933,
the Company  certifies that it has  reasonable  grounds to believe that it meets
all of the  requirements of filing on Form SB-2 and authorized this amendment to
the registration statement to be signed on its behalf by the undersigned, in the
City of New York, State of New York, on October 14, 1997.

                                             OBJECTSOFT CORPORATION


                                             By:  /s/ David E. Sarna, Chairman
                                               ---------------------------------
                                                  David E. Sarna, Chairman

           In accordance  with the  requirements  of the Securities Act of 1933,
this amendment to the registration statement was signed by the following persons
in the capacities and on the dates indicated.


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

/s/ David E. Y. Sarna         Chairman  of the Board of         October 14, 1997
- -------------------------     Directors and Secretary         
David E. Y. Sarna             (Co-Principal Executive Officer 
                              and Principal Financial Officer)
                                            
                                            
        *                     President, Treasurer and Director October 14, 1997
- -------------------------     (Co-Principal Executive Officer 
George J. Febish              and Principal Accounting Officer)       
                              
                                            

        *                     Director                          October 14, 1997
- -------------------------     
Daniel E. Ryan


        *                     Director                          October 14, 1997
- -------------------------     
Gunther L. Less






*By: /s/ David E.Y. Sarna
   -------------------------
   David E.Y. Sarna,
   Attorney-in-Fact




                                     II - 6





                         CONSENT OF INDEPENDENT AUDITORS

           We consent to the inclusion in this post effective amendment No. 1 to
the  registration  statement on Form SB-2 of our report dated March 7, 1997,  on
the financial  statements of ObjectSoft  Corporation as at December 31, 1996 and
for each of the two years in the  two-year  period ended  December 31, 1996.  We
also consent to the reference to our firm under the captions "Selected Financial
Data" and "Experts."




Richard A. Eisner & Company, LLP

Florham Park, New Jersey
October 14, 1997



© 2022 IncJournal is not affiliated with or endorsed by the U.S. Securities and Exchange Commission