MULTIMEDIA ACCESS CORP
SB-2/A, 1996-11-21
RADIO & TV BROADCASTING & COMMUNICATIONS EQUIPMENT
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       AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON NOVEMBER 21, 1996
                                                      REGISTRATION NO. 333-09935
    
================================================================================
                       SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549
                                 AMENDMENT NO. 2
                                       TO
                                    FORM SB-2
                             REGISTRATION STATEMENT
                                      UNDER
                           THE SECURITIES ACT OF 1933
                          MULTIMEDIA ACCESS CORPORATION
                 (NAME OF SMALL BUSINESS ISSUER IN ITS CHARTER)

<TABLE>
<CAPTION>
<S>                                    <C>                             <C>
          Delaware                               3661                        75-2528700
  (State or Other Jurisdiction              Primary Standard               (IRS Employer
of Incorporation or Organization)      Classification Code Number      Identification Number)
</TABLE>

             2665 VILLA CREEK DRIVE, SUITE 200, DALLAS, TEXAS 75234
                                  972-488-7200
                                   ----------
   (Address of principal executive offices and place of business and
                              telephone number)
                                   ----------
                                GLENN A. NOREM
                           CHIEF EXECUTIVE OFFICER
                        MULTIMEDIA ACCESS CORPORATION
            2665 VILLA CREEK DRIVE, SUITE 200, DALLAS, TEXAS 75234
                                 972-488-7200
                                   ----------
          (NAME, ADDRESS AND TELEPHONE NUMBER OF AGENT FOR SERVICE)

                                    Copies to:

<TABLE>
<CAPTION>
  <S>                                 <C>                                             <C>
      John S. Stoppelman, Esq.                      Jay Kaplowitz, Esq.                     Lawrence B. Fisher, Esq.
   The Stoppelman Law Firm, P.C.         Gersten, Savage, Kaplowitz, Curtin, L.L.P.   Orrick, Herrington & Sutcliffe, L.L.P.
  1749 Old Meadow Road, Suite 610                   575 Lexington Avenue                    666 Fifth Avenue
    McLean, Virginia 22102-4310                   New York, NY 10022-6102                  New York, NY 10103
      Telephone: (703) 827-7450                  Telephone: (212) 752-9700              Telephone: (212) 506-5000
     Telecopier: (703) 827-7455                 Telecopier: (212) 752-9713              Telecopier: (212) 506-5151
</TABLE>

Approximate  date of proposed sale to the public:  As soon as practicable  after
the Registration Statement becomes effective __________ 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 the delivery of the  prospectus  is expected to be made pursuant to Rule 434,
please check the following box. [X]

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]
<TABLE>
<CAPTION>

                       CALCULATION OF REGISTRATION FEE
 ---------------------------------------------------------------------------------------------------------------
          TITLE OF EACH CLASS                              PROPOSED MAXIMUM  PROPOSED MAXIMUM
          OF SECURITIES TO BE              AMOUNT TO BE     OFFERING PRICE      AGGREGATE         AMOUNT OF
               REGISTERED                   REGISTERED       PER SHARE(1)     OFFERING PRICE   REGISTRATION FEE
- ----------------------------------------------------------------------------------------------------------------
<S>                                      <C>              <C>               <C>               <C>
Common Stock, $.0001 par value.........  2,547,244(2)(3)  $6.00             $15,283,464        $5,270
Redeemable Common Stock Purchase
Warrants ("Public Warrants")...........  2,547,244(4)(5)  $0.10                 254,724        $   88
Common Stock issuable upon exercise of
Public Warrants........................  2,547,244        $8.40              21,396,850        $7,378
TOTAL REGISTRATION FEE......................................................                  $12,736
Paid........................................................................                  $12,704
                                                                                              -------
Due.........................................................................                  $    32
</TABLE>

================================================================================
(1) Estimated solely for purposes of calculating the registration fee.

(2)  Includes  270,000  Shares  which  the  Representatives  have the  option to
     purchase to cover over-allotments, if any.

   
(3) Includes 477,244 shares to be sold by Selling Securityholders.
    

(4) Includes 270,000 Public Warrants which the  Representatives  have the option
    to purchase to cover over-allotments, if any.

   
(5) Includes 477,244 Public Warrants to be sold by Selling Securityholders.
    
                                   ----------
   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>
                        MULTIMEDIA ACCESS CORPORATION
                                   ----------
             CROSS-REFERENCE SHEET SHOWING LOCATION IN PROSPECTUS
                OF INFORMATION REQUIRED BY ITEMS OF FORM SB-2

<TABLE>
<CAPTION>
  FORM SB-2 REGISTRATION STATEMENT ITEM AND HEADING                    LOCATION IN PROSPECTUS
- -----------------------------------------------------  -----------------------------------------------------
<S>                                                    <C>
 1. Front of Registration Statement and Outside
    Front Cover of Prospectus........................  Outside Front Cover Page of Prospectus
 2. Inside Front and Outside Back Cover Pages of       Inside Front and Outside Back Cover Pages of
    Prospectus.......................................  Prospectus
 3. Summary Information and Risk Factors.............  Prospectus Summary; Risk Factors
 4. Use of Proceeds..................................  Use of Proceeds
 5. Determination of Offering Price..................  Underwriting
 6. Dilution.........................................  Dilution
 7. Selling Security Holders ........................  *
 8. Plan of Distribution.............................  Outside Front Cover Page of Prospectus; Underwriting
 9. Legal Proceedings................................  Legal Proceedings
10. Directors, Executive Officers, Promoters and
    Control Persons .................................  Management; Principal Stockholders; Certain
                                                       Transactions
11. Security Ownership of Certain Beneficial Owners
    and Management...................................  Management
12. Description of Securities .......................  Description of Securities; Underwriting
13. Interests of Named Experts and Counsel ..........  Interest of Named Experts and Counsel
14. Disclosure of Commission Position on
    Indemnification for Securities Act Liabilities...  Management
15. Organization Within Last Five Years..............  Prospectus Summary
16. Description of Business .........................  Prospectus Summary; Risk Factors; Management's
                                                       Discussion and Analysis of Financial Condition and
                                                       Results of Operations; Business; Management; Certain
                                                       Transactions; Principal Securityholders;  Consolidated
                                                       Financial Statements
17. Management's Discussion and Analysis or Plan of
    Operations ......................................  Management's Discussion and Analysis of Financial
                                                       Condition and Results of Operations
18. Description of Property .........................  Business
19. Certain Relationships and Related Transactions ..  Certain Transactions
20. Market for Common Equity and Related Stockholder
    Matters..........................................  Front Cover Page; Description of Securities
21. Executive Compensation...........................  Management
22. Financial Statements.............................  Consolidated Financial Statements
23. Change in and Disagreements with Accountants on
    Accounting and Financial Disclosure..............  Experts
- ----------
</TABLE>

* See Explanatory Note
<PAGE>
                               EXPLANATORY NOTE

   Two forms of  Prospectus  are included in this  Registration  Statement.  The
first  Prospectus will be used in connection  with an  underwritten  offering of
securities by the Company (the "Company Prospectus"). The second Prospectus will
be  used  in  connection   with  the  sale  of  securities  by  certain  selling
securityholders  from time to time in open  market  transactions  (the  "Selling
Securityholders   Prospectus").   The   Company   Prospectus   and  the  Selling
Securityholders Prospectus are substantially identical, except for the 4
pages for the  Selling  Securityholders  Prospectus  included  herein  which are
labeled  "Alternate Page for Selling  Securityholders  Prospectus." In addition,
what is referred to as "the offering" in the Company  Prospectus will be changed
to "the Company Offering" throughout the Selling Securityholders Prospectus.

   After this Registration  Statement becomes effective,  both Prospectuses will
be used  in  their  entirety  in  connection  with  the  offer  and  sale of the
respective securities referenced therein.

<PAGE>
   
                 SUBJECT TO COMPLETION, DATED NOVEMBER 21, 1996
    

PROSPECTUS

[LOGO]                   MULTIMEDIA ACCESS CORPORATION
                       1,800,000 SHARES OF COMMON STOCK
             1,800,000 REDEEMABLE COMMON STOCK PURCHASE WARRANTS

   MultiMedia Access  Corporation (the "Company") hereby offers 1,800,000 shares
of Common Stock, $.0001 par value per share (the "Common Stock"),  and 1,800,000
Redeemable  Common Stock Purchase Warrants  ("Public  Warrants").  The shares of
Common  Stock and the  Public  Warrants  (together,  the  "Securities")  must be
purchased  on the basis of one Public  Warrant  for each  share of Common  Stock
purchased and will be separately  transferable  immediately upon issuance.  Each
Public Warrant  entitles the holder to purchase one (1) share of Common Stock at
$ per share (120% of the price  offered to the  public),  subject to  adjustment
under certain circumstances,  at any time commencing six months from the date of
this  Prospectus  through  and  including  five  years  from  the  date  of this
Prospectus.  The Public  Warrants are  redeemable  by the  Company,  at any time
commencing eighteen (18) months from the date of this Prospectus, upon notice of
not less than thirty (30) days, at a price of $.10 per Public Warrant,  provided
that the  closing  price or bid price of the Common  Stock for any  twenty  (20)
trading days within a period of thirty (30)  consecutive  trading days ending on
the  fifth  (5th)  day prior to the day on which  the  Company  gives  notice of
redemption  has been at least 250%  (currently $ , subject to adjustment) of the
then  effective  exercise  price  of  the  Public  Warrants.   It  is  currently
anticipated  that the initial public  offering price of the Common Stock will be
$5.00 to $6.00 and $.10 per Public Warrant. See "Description of Securities."

   Prior to this offering,  there has been no public market for the Common Stock
or Public  Warrants  and there can be no  assurance  that any such  market  will
develop. It is anticipated that the Common Stock and the Public Warrants will be
quoted on the NASDAQ  Small-Cap  Market  ("NASDAQ") under the symbols "MMAC" and
"MMACW" respectively.  For a discussion of the factors considered in determining
the offering prices of the Common Stock and Public Warrants, see "Underwriting."

   
     Concurrently with this offering,  the Company is registering 477,244 shares
of Common Stock (the "Selling Securityholder  Shares"),  477,244 Public Warrants
and  477,244  shares  underlying  the  Public  Warrants  to be sold  by  Selling
Securityholders  in a  debt  retirement  and  debt  for  equity  exchange  which
securities  are the subject of two year "lock-up"  agreements.  The Company will
not  receive  any of the  proceeds  of the sale of Common  Stock by the  Selling
Securityholders,  but will  receive the  proceeds of the  exercise of the Public
Warrants  by  the  Selling  Securityholders.  See  "Concurrent  Registration  of
Securities."
    
                                   ----------
                         THE SECURITIES OFFERED HEREBY
    ARE SPECULATIVE AND INVOLVE A HIGH DEGREE OF RISK AND IMMEDIATE DILUTION
     AND SHOULD NOT BE PURCHASED BY INVESTORS WHO CANNOT AFFORD THE LOSS OF
           THEIR ENTIRE INVESTMENT. SEE "RISK FACTORS" AND "DILUTION."
                                   ----------
    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.

                                   ----------
================================================================================
                                        Underwriting
                              Price     Discounts and       Proceeds to
                            to Public   Commissions(1)       Company(2)
- --------------------------------------------------------------------------------
Per Share....................$ --          $ --             $ --
- --------------------------------------------------------------------------------
Per Warrant .................$ --          $ --             $ --
- --------------------------------------------------------------------------------
Total(3).....................$ --          $ --             $ --
================================================================================

(1)  In  addition,  the  Company has agreed to pay to the  Representatives  a 3%
     nonaccountable  expense allowance and to sell to the  Representatives,  for
     nominal consideration,  warrants to purchase up to 180,000 shares of Common
     Stock  and up to  180,000  Public  Warrants.  The  Company  has  agreed  to
     indemnify  the  Representatives  against  certain  liabilities,   including
     liabilities under the Securities Act. See "Underwriting."

(2)  Before  deducting  expenses,  estimated  at  $ ,  payable  by  the  Company
     including  the  Representatives'   nonaccountable  expense  allowance.  The
     Selling Securityholders will not bear any of the expenses of this offering.

(3)  The Company has granted the  Representatives an option,  exercisable within
     45 days  from  the  date of this  Prospectus,  to  purchase  up to  270,000
     additional shares of Common Stock and/or 270,000 additional Public Warrants
     on the same terms and conditions as set forth above, solely for the purpose
     of covering over-allotments. If such option is exercised in full, the Price
     to Public,  Underwriting  Discounts and Commissions and Proceeds to Company
     will be $      , $       and $        , respectively. See "Underwriting."
                                   ----------
   The Common  Stock and Public  Warrants  are being  offered,  subject to prior
sale,  when,  as and if delivered and accepted by the several  Underwriters  and
subject to the approval of certain legal matters by counsel and to certain other
conditions. The Underwriters reserve the right to withdraw, cancel or modify the
offering  and to  reject  any  order in whole or in part.  It is  expected  that
delivery  of  certificates  representing  the Common  Stock and Public  Warrants
contained  therein,  will be made  against  payment  therefor  at the offices of
National Securities Corporation on or about , 1996.

NATIONAL SECURITIES CORPORATION             NETWORK 1 FINANCIAL SECURITIES, INC.

                  The date of this Prospectus is      , 1996

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 securities in any
State in which  such  offer,  solicitation  or sale would be  unlawful  prior to
registration or qualification under the securities laws of any such State.

<PAGE>
                             [MARKETING DISPLAY]

   IN CONNECTION WITH THIS OFFERING,  THE  UNDERWRITERS MAY OVER-ALLOT OR EFFECT
TRANSACTIONS  WHICH  STABILIZE  OR MAINTAIN THE MARKET  PRICES OF THE  COMPANY'S
COMMON  STOCK AND PUBLIC  WARRANTS AT LEVELS  ABOVE THOSE WHICH MIGHT  OTHERWISE
PREVAIL IN THE OPEN  MARKET.  SUCH  TRANSACTIONS  MAY BE  EFFECTED IN THE NASDAQ
SMALL  CAP  MARKET  OR  OTHERWISE.  SUCH  STABILIZING,   IF  COMMENCED,  MAY  BE
DISCONTINUED AT ANY TIME.

<PAGE>
                                   SUMMARY

   The following  summary is qualified in its entirety by the other  information
and consolidated  financial  statements  appearing elsewhere in this Prospectus.
Each  prospective  investor is urged to read this  Prospectus  in its  entirety.
Unless otherwise indicated all per share data and information in this Prospectus
relating to the number of shares of Common  Stock  outstanding  assumes that the
Representatives' over-allotment option will not be exercised. For an explanation
of certain technical terms used in this Prospectus, see "Glossary."

                                 THE COMPANY

   MultiMedia Access  Corporation (the "Company")  develops and markets advanced
video  communications  products for the personal computer ("PC") and workstation
marketplaces.  Applications include desktop videoconferencing  ("DVC"), Internet
and Intranet video  communications,  video-based  training,  video surveillance,
distance  learning and high quality  workgroup video  communications.  While the
Company  sells  its core  video  compression-decompression  ("Codec")  and video
switching  technologies  to  resellers  and  systems  integrators,  its  primary
strategy is to develop and market video  communications  applications  using its
technologies.

   The Company, in September 1996, entered into a reseller agreement with Unisys
Corporation  ("Unisys"),  a  nationwide  systems  integrator  and  reseller,  to
purchase  and resell  the  Company's  Viewpoint  VBX(Trademark).  The  Viewpoint
VBX(Trademark)  is a  PC-based  video  switch  which  provides  workgroup  video
communications   over  existing  telephone  or  network  wiring  commonly  found
throughout office buildings. Unlike commercially available competitive products,
the Viewpoint  VBX(Trademark) connects over 100 users per switch and distributes
full-motion video at distances up to 3,500 feet via existing  unshielded twisted
pair ("UTP") wiring.

   The  Company  entered  into a licensing  agreement  with Boca  Research  Inc.
("Boca"),  a major modem and PC peripheral  supplier,  to manufacture and market
the Company's  FamilyFone(Trademark) and its ISDN videoconferencing  upgrades in
January  1996,  and  delivered  its first video  surveillance  system to Alcatel
Network Systems Inc.  ("Alcatel"),  a major  communications  systems integration
company,  in the first quarter of 1996.  The Company  believes it sells the only
currently  available  standards-based,  multi-algorithm  video and  audio  Codec
product  for  WindowsNT  and is  developing  a  multi-algorithm  Codec  for  Sun
Microsystem ("Sun") workstations.

   According to industry sources, the video communications  industry is forecast
to be $3.6 billion by 1999 and the emerging  desktop segment of that industry is
forecast to exceed $1.2 billion by 1999. The PC dominates the desktop  computing
market with 1995 sales of over 57 million  units  worldwide and an estimated 100
million new PCs projected to be sold annually by 1999. Industry sources estimate
that over 30% of the new PCs sold in 1996 (principally  multimedia  capable PCs)
will be purchased by consumers for use in the home. The Company  believes it has
developed products which position it to benefit from the growth of these markets
and which will have functions,  performance and cost to successfully  compete in
the rapidly-emerging desktop video communications industry.

                                PRODUCT FAMILY

   The Company  currently  offers a variety of  products  with  differing  video
quality levels: NTSC TV quality with the Viewpoint  VBX(Trademark) video switch,
business quality with the  Osprey-1000(Trademark)  using ISDN lines and consumer
quality video with  FamilyFone(Trademark)  using modems over ordinary  telephone
lines. The resolution and framerate of the video varies with the bandwith of the
communications connection.

   Corporate  Intranet  Video.  The Company's  Viewpoint-PRO(Trademark)  product
enables users to engage in real-time,  full-color,  full-motion video over their
existing computer networks. The Viewpoint-PRO(Trademark) supports point-to-point
and up to five site multipoint videoconferences. Unlike many currently available
ISDN-based  products,  the Viewpoint  PRO(Trademark)  does not require expensive
multipoint  control  units,  which can cost as much as  $20,000,  to  complete a
multipoint  videoconference.  Viewpoint  PRO(Trademark) also comes equipped with
ViewCast(Trademark),  a one-to-many  broadcasting capability that permits "live"
broadcasts or  pre-recorded  content to be multicast over an existing  corporate
data

                                        3

<PAGE>
network. Viewpoint PRO(Trademark),  combined with optional third-party software,
offers  videoconference  participants  the ability to share a whiteboard or a PC
application.  Viewpoint PRO(Trademark) was the first commercial product offering
video  multicast  using both FTP  Software  Inc.'s and  Microsoft  Corporation's
TCP/IP-Multicast PC software.

   Consumer  Video.  The  Company  believes  its  FamilyFone(Trademark)  product
provides affordable, good quality video communications capabilities to consumers
and small businesses.  This product,  which operates on standard telephone lines
and 28.8 Kbps  (kilobits  per  second)  modems,  was  introduced  by Boca as the
BocaPRO  Video Phone Elite in August 1996 at a suggested  retail  price of $399.
The cost of the product does not include the price of cameras and speakers.

   Video  Codecs.  The Company  develops and markets  standards-based  video and
audio  Codec  products  that  enable   multimedia   applications   for  PCs  and
workstations. The Company's Osprey Codecs capture, digitize, compress, transmit,
receive, decompress and display full-motion video. The Osprey 1000(Trademark) is
compatible  with multiple video and audio  compression  formats for both PCs and
workstations  that are  equipped  with the  standard  PCI-bus and  supports  the
Windows NT,  Windows 3.1,  Windows95,  Solaris and UNIX operating  systems.  The
Company  believes the Osprey  1000(Trademark)  is the only  currently  available
standards-based,  multi-algorithm  video and audio Codec product for the Windows
NT operating system.

   The Company is  currently  developing  a version of the Osprey  Codec for Sun
workstations   equipped  with  the  S-bus.   The  Company  has  also   developed
SLIC-Video(Trademark),  a video  capture  product that  enables Sun  workstation
users to view uncompressed,  high-quality video and to capture full-motion video
frames.  SLIC-Video(Trademark)  is  compatible  with a  wide  variety  of  video
applications on existing Sun workstations.

   Video  Switching  Hub and UTP Video  Distribution.  The  Company's  Viewpoint
VBX(Trademark) product provides high-quality workgroup video communications with
shared   gateways  to  Wide  Area   Networks   ("WANs")   and   existing   video
teleconferencing  room  systems.  The  Viewpoint  VBX(Trademark)  operates  on a
PC-based  WindowsNT  system and employs a switched  architecture  to  distribute
uncompressed,  full-motion  video within a building or campus using existing UTP
wiring.  The  switching  architecture  can support  hundreds of users and allows
point-to-point,  multipoint  and  broadcast  modes of  operation.  The Viewpoint
VBX(Trademark)  is compatible  with standard  NTSC  cameras,  audio  components,
speakerphones,   PC  video  peripherals  and  other  videoconferencing  products
produced by third-party manufacturers.

   Internet Video. The Company is currently developing and plans to market three
Internet video products and their software  players to capitalize on the growing
popularity of the World Wide Web (the "Web"). Subscribers to the Web have sought
improved Internet access capabilities,  which has resulted in increased usage of
28.8 Kbps modems,  ISDN  adapters and cable  modems.  Improvements  in video and
audio compression  technology,  standards and Internet access have made possible
new forms of  motion-video  content for  Internet  publishers  and their  target
audiences.  The Company's products are being designed to take advantage of these
technological  developments and target the rapidly- emerging market for Internet
video  publishing,  Internet video broadcasts and Internet video call centers by
enhancing Internet web pages with audio and motion-video.

   Video  Surveillance.  The Company  believes that  commercial and  residential
video surveillance products represent another strong business  opportunity.  The
Company  delivered its first video  surveillance  system to Alcatel in the first
quarter of 1996. This industrial  surveillance  system integrates standard alarm
and  sensory  devices  and  allows a central  operator  to monitor  and  inspect
hundreds of remote  sites over the  customer's  existing  frame  relay  computer
network.  The  Company  intends to enter into  relationships  and  collaborative
projects with  communication  system  integrators,  security  system  resellers,
distributors and suppliers to capitalize on this market.

   The  Company   believes  that  the   convergence   of  multimedia   PCs,  new
standards-based  audio and video  technologies  and  increased  interest  in the
Internet  and  corporate  Intranets  combined  with PC  price  levels  for  such
capabilities will generate a rapid adoption of video communications products and
services.  The Company's enabling  technologies provide for economical solutions
for adapting existing and new PCs with video communication capabilities.

                                        4

<PAGE>
   The Company was incorporated in Delaware in February 1994 and acquired all of
the issued and outstanding  capital stock of its affiliate,  Viewpoint  Systems,
Inc.  ("Viewpoint") in May 1994. Unless otherwise indicated,  references in this
Prospectus  to the Company  include its  wholly-owned  subsidiaries,  Viewpoint,
Videoware,  Inc. ("VideoWare"),  and Osprey Technologies,  Inc. ("Osprey"),  all
Delaware corporations.  The Company's principal executive offices are located at
2665 Villa Creek Drive, Suite 200, Dallas,  Texas 75234, its telephone number is
(972)  488-7200,  its fax number is (972)  488-7299 and its Internet  address is
www.mmac.com.

                                        5


<PAGE>
                                 THE OFFERING

Securities Offered..................     1,800,000  shares of  Common  Stock and
                                         1,800,000  Public  Warrants to purchase
                                         one (1)  share  of  Common  Stock  at $
                                         (120% of price  offered to the public).
                                         The  shares  of  Common  Stock  and the
                                         Public  Warrants  must be  purchased on
                                         the  basis of one  Public  Warrant  for
                                         each  share of Common  Stock  purchased
                                         and  will  be  separately  transferable
                                         immediately  upon  issuance.  See "Risk
                                         Factors  --  Warrants   Redeemable   at
                                         Nominal  Price"  and   "Description  of
                                         Securities."
   
Common Stock to be Outstanding after
  the Offering(1)...................     7,331,558
Warrants to be Outstanding after the
  Offering..........................     5,000,649
    
Terms of the Public
  Warrants..........................     Each Public  Warrant is  exercisable at
                                         any time commencing six months from the
                                         date of his Prospectus and entitles the
                                         holder thereof to purchase one share of
                                         Common St ock at a price of $ per share
                                         (120%  of  the  price  offered  to  the
                                         public),   subject  to   adjustment  in
                                         certain  circumstances,   at  any  time
                                         until five years after the date of this
                                         Prospectus.  The  Public  Warrants  are
                                         redeemable by the Company,  at any time
                                         comme ncing  eighteen  months after the
                                         date of this Prospectus,  at a price of
                                         $.10 per Public Warrant,  upon not less
                                         than 30 days  prior  written  notice to
                                         the  registered  holders  of the Public
                                         Warrants,  provided  that  the  closing
                                         price or bid price of the Common  Stock
                                         equals or exceeds  250% of the exercise
                                         price   (currently   $  ,   subject  to
                                         adjustment) of the Public  Warrants for
                                         any 20 trading  days within a period of
                                         30  consecutive  trading days ending on
                                         the fifth day prior to the day on which
                                         the Company gives notice of redemption.
                                         See   "Description   of  Securities  --
                                         Warrants."
Use of Proceeds......................    The  Company  intends  to use  the  net
                                         proceeds of this offering for repayment
                                         of  outstanding  accounts  payable  and
                                         indebtedness  (including amounts due to
                                         affiliates of the  Company);  marketing
                                         and  sales  activities;   research  and
                                         development;   and  the   balance   for
                                         working  capital and general  corporate
                                         purposes. See "Use of Proceeds."
Risk Factors .......................     The   securities   offered  hereby  are
                                         speculative  and  involve a high degree
                                         of  risk  and   immediate   substantial
                                         dilution and should not be purchased by
                                         investors who cannot afford the loss of
                                         their  entire  investment.   See  "Risk
                                         Factors" and "Dilution."
Proposed Nasdaq Symbol..............     Common Stock -- MMAC
                                         Public Warrants -- MMACW
   
- ----------

(1)  Includes  477,244  shares  of  Common  Stock  issued  on the  date  of this
     Prospectus   upon  the  conversion  of  $2,330,300   principal   amount  of
     Convertible  Debt and  approximately  $342,294  of accrued  interest at the
     offering price of the Common Stock and Public Warrants (based on an assumed
     offering  price of $5.50 per share and $.10 per Public  Warrant).  Does not
     include (i)  1,442,505  shares of Common Stock  reserved for issuance  upon
     exercise of  outstanding  warrants to purchase  common stock,  (ii) 180,000
     shares  of  Common  Stock  reserved  for  issuance  upon  exercise  of  the
     Representative's  Warrants,  (iii) 180,000  shares of Common Stock reserved
     for issuance upon exercise of  Representative's  Public  Warrants  issuable
     upon exercise of Representative's  Warrants,  (iv) 957,975 shares of Common
     Stock  reserved for issuance upon exercise of options  available for future
     grant under the 1995 Option  Plan,  (v)  1,042,025  shares of Common  Stock
     reserved  for  issuance  upon  exercise of options  granted  under the 1995
     Option Plan, (vi) 906,749 shares of Common Stock reserved for issuance upon
     exercise of options  granted  under the 1994  Option  Plan,  (vii)  103,549
     shares of Common  Stock  reserved  for  issuance  upon  exercise of options
     granted  under the 1993 Option Plan,  (viii)  25,000 shares of Common Stock
     reserved  for  issuance  upon  exercise of options  granted  under the 1995
     Directors  Stock Option Plan,  (ix) 225,000 shares of Common Stock reserved
     for issuance upon exercise of options  available for future grant under the
     1995  Directors  Stock  Option  Plan,  (x) 250,000  shares of Common  Stock
     reserved  for  issuance  under  the  Employee  Stock  Purchase  Plan,  (xi)
     1,280,900 shares of Common Stock reserved for issuance upon exercise of the
     Convertible Debt Warrants,  (xii) 1,800,000 shares of Common Stock reserved
     for  issuance  upon  exercise of the Public  Warrants,  and (xiii)  477,244
     shares of Common  Stock  reserved  for  issuance  upon  exercise  of Public
     Warrants  issued  on  the  date  of  this  Prospectus  upon  conversion  of
     $2,330,300 principal amount of Convertible Debt and approximately  $342,294
     of  accrued  interest  at the  offering  price of Common  Stock and  Public
     Warrants based on an assumed offering price of $5.50 per share and $.10 per
     Public  Warrant.  See  "Management's  Discussion  and Analysis of Financial
     Condition and Results of Operations," "Management -- Employee Stock Plans,"
     "Description of Securities" and "Underwriting."     

                                        6
<PAGE>
                  SUMMARY CONSOLIDATED FINANCIAL INFORMATION

   
   The following  summary  financial data as of December 31, 1994,  December 31,
1995 and September 30, 1996 and for each of the periods ended  December 31, 1994
and  1995  and  September  30,  1995 and  1996 is  derived  from  the  Company's
consolidated  financial  statements.  The  following  data  should  be  read  in
conjunction with the consolidated financial statements of the Company, including
the notes thereto included  elsewhere herein.  See "Management's  Discussion and
Analysis of Financial  Condition and Results of  Operations"  and  "Consolidated
Financial Statements."     

CONSOLIDATED STATEMENT OF OPERATIONS DATA:

<TABLE>
<CAPTION>
                                                                                                 CUMULATIVE
                                                                                               FROM INCEPTION
                                                                                               (NOV. 19, 1992)
                                                                  NINE MONTHS ENDED SEPTEMBER   TO SEPTEMBER
                                        YEAR ENDED DECEMBER 31,               30,                    30,
                                      --------------------------- --------------------------- ----------------
                                           1994          1995          1995          1996           1996
                                      ------------- ------------- ------------- ------------- ----------------
<S>                                   <C>           <C>           <C>           <C>           <C>
Net sales...........................  $   127,531   $   285,354   $   244,223   $   900,446   $  1,377,407
Cost of goods sold..................       64,363       136,381       112,452       315,437        547,994
Gross profit........................       63,168       148,973       131,771       585,009        829,413
Operating expenses .................    2,740,692     4,720,559     3,072,323     3,322,530     11,451,185
Other expense (principally
interest)...........................      (39,897)     (843,292)     (568,958)     (343,561)    (1,239,735)
Net loss(1).........................   (2,717,421)   (5,414,878)   (3,509,510)   (3,081,082)   (11,861,511)
Net loss per share..................  $     (0.53)  $     (0.98)  $     (0.64)  $     (0.49)
Common and common equivalent shares
outstanding.........................    5,157,932     5,542,184     5,480,438     6,283,167
</TABLE>

CONSOLIDATED BALANCE SHEET DATA:

<TABLE>
<CAPTION>
                                        DECEMBER 31,                       SEPTEMBER 30, 1996
                                ---------------------------- ---------------------------------------------
                                     1994          1995
                                ------------- --------------
                                                                                              PRO FORMA
                                                                                                  AS
                                                                 ACTUAL      PRO FORMA(2)   ADJUSTED(2)(3)
                                                             -------------- -------------- ---------------
<S>                             <C>           <C>            <C>            <C>            <C>
Working capital (deficit) ....  $  (209,143)  $(3,891,602)   $(4,680,592)   $(4,680,592)   $6,261,602
Total assets..................    1,781,055     1,244,766      1,560,096      2,060,096     8,260,303
Total liabilities.............    3,180,807     4,497,330      6,103,043      6,603,043     1,861,056
Stockholders' equity
(deficit).....................   (1,399,752)   (3,252,564)    (4,542,947)    (4,542,947)    6,399,247
</TABLE>
- ----------
(1)  From  Viewpoint's  inception  through its acquisition by the Company on May
     11, 1994,  Viewpoint  elected to be treated as an S Corporation for federal
     income  tax  purposes  and,  accordingly,  its  taxable  income or loss was
     included in the income tax returns of its shareholders.  Viewpoint's status
     as an S Corporation was terminated on May 11, 1994.
   
(2)  Gives pro forma effect to transactions subsequent to September 30, 1996 but
     prior to the date of this Prospectus  consisting of issuance of Bridge Debt
     of $500,000. See "Description of Securities" and "Certain Transactions."

(3)  Gives effect,  on an as adjusted basis, to the sale of the 1,800,000 shares
     of Common  Stock and  1,800,000  Public  Warrants  offered  hereby  and the
     initial  application  of the estimated net proceeds  therefrom.  Also gives
     effect to the  conversion  of $2,330,300  of  Convertible  Debt and accrued
     interest of approximately $342,294 to Common Stock at the estimated initial
     public offering price of $5.50 per share and $.10 per Public  Warrant.  See
     "Use of Proceeds," "Certain  Transactions" and "Description of Securities."
         

                                        7
<PAGE>
                                 RISK FACTORS

   The securities  offered hereby are  speculative  and involve a high degree of
risk. Each  prospective  investor should  carefully  consider the following risk
factors  inherent in and affecting the business of the Company and this offering
before making an investment decision.
   
   Development  Stage  Company;   Limited  Operating   History;   Going  Concern
Qualification  in  Independent  Auditor's  Report.  The Company is a development
stage company and has commenced limited marketing of its products.  Accordingly,
the Company has a limited  operating  history  upon which an  evaluation  of its
prospects can be made.  Such prospects must be considered in light of the risks,
expense,  delays,  problems  and  difficulties  frequently  encountered  in  the
establishment  of a  new  business  in  an  industry  characterized  by  intense
competition,  as well as risks  encountered  in the shift  from  development  to
commercialization  of  new  products  based  on  innovative  technologies.   The
Company's prospects are dependent upon the successful  commercialization  of its
products.  There can be no assurance  that the Company will be able to implement
its business  plan or that  unanticipated  expenses,  problems or  difficulties,
technical   or   otherwise,   will  not  result  in   material   delays  in  its
implementation. The Company's independent auditors have included a going concern
qualification  in their audit  report on the  Company's  consolidated  financial
statements  stating that such financial  statements have been prepared  assuming
that the Company will continue as a going concern and that,  among other things,
the Company's  financial  condition and losses from  operations  since inception
raise  substantial doubt about the ability of the Company to continue as a going
concern.  Statement  of  Financial  Accounting  Standards  No. 107 ("SFAS  107")
requires an entity to disclose the fair value of financial instruments for which
it is  practicable  to  estimate  that  value.  Management  of the  Company  has
determined that it is not practicable to estimate,  in accordance with SFAS 107,
the fair  values at  December  31,  1995 of its long and short  term  debt.  See
"Management's  Discussion  and  Analysis of Financial  Condition  and Results of
Operations,"  "Business"  and  Note  1 and  Note  2 of  "Notes  to  Consolidated
Financial Statements."

   Limited Revenue;  Significant Losses;  Accumulated Deficit.  Since inception,
the Company has  generated  limited  revenue,  including  revenues of  $127,531,
$285,354,  and $900,446 and incurred  significant  losses,  including  losses of
$2,717,421,  $5,414,878 and $3,081,082 for the years ended December 31, 1994 and
1995,  and the nine months  ended  September  30,  1996,  respectively,  and has
continued to incur significant additional losses to date. At September 30, 1996,
cumulative  losses since inception  through September 30, 1996 were $11,861,511.
Inasmuch as the Company  intends to increase its level of  activities  following
consummation  of  this  offering  and  will  be  required  to  make  significant
expenditures  in connection with marketing and product  development  activities,
the Company anticipates that losses will continue for the foreseeable future and
until such time as the Company is able to build an effective marketing and sales
organization,  develop a network of  independent  resellers  and achieve  market
acceptance of its products.  In addition,  the Company's future performance will
be subject to a number of business factors beyond the Company's control, such as
technological  changes  and  developments  by  others  and  unfavorable  general
economic conditions,  including downturns in the economy or a decline in the DVC
or PC  industries  or in targeted  commercial  markets,  which would result in a
reduction or deferral of capital  expenditures by prospective  customers.  There
can be no assurance that the Company will be able to successfully  implement its
marketing  strategy,   generate   significant  revenues  or  achieve  profitable
operations. See "Management's Discussion and Analysis of Financial Condition and
Results of Operations" and "Consolidated Financial Statements."     

   Significant Capital Requirements;  Dependence on Offering Proceeds;  Possible
Need for Additional Financing.  The Company's capital requirements in connection
with the design, development and commercialization of its products have been and
will continue to be  significant.  To date,  the Company has been  substantially
dependent  upon  loans  from  its  principal  stockholders,  as well as  private
placements  of its debt and equity  securities,  to finance its working  capital
requirements.  The Company is  dependent  on the  proceeds  of this  offering to
commence  full-scale  marketing  activities in connection with its products,  to
complete the development of additional product and software applications, and to
fund the Company's working capital requirements.  The Company anticipates, based
on currently proposed plans and assumptions relating to its operations, that the
proceeds of this offering will be  sufficient to satisfy its  contemplated  cash
requirements  for at least twelve  months  following  the  consummation  of this
offering.
                                        8
<PAGE>
In the event that the Company's plans change or prove to be inaccurate or if the
proceeds of this  offering  prove to be  insufficient  to fund  operations,  the
Company could be required to seek  additional  financing  sooner than  currently
anticipated or could be required to curtail its  activities.  The Company has no
current arrangements with respect to, or sources of, additional  financing,  and
there can be no assurance that existing stockholders will provide any portion of
the Company's future financing requirements.  There can be no assurance that any
additional financing will be available to the Company on acceptable terms, or at
all.  Additional  equity  financing  may  involve  substantial  dilution  to the
interests of the Company's then existing stockholders. See "Use of Proceeds" and
"Certain Transactions."

   Technological    Factors;    Uncertainty   of   Product    Development    and
Commercialization.   The   Company   has   only   recently   commenced   limited
commercialization  of its products for a limited  number of users.  Accordingly,
there can be no assurance that,  upon  widespread  commercial use, if any, these
products  will  satisfactorily  perform all of the functions for which they have
been designed or that they will operate  satisfactorily.  The Company intends to
use a portion of the  proceeds  of this  offering  in  connection  with  product
refinement and enhancement and the development of additional  products.  Product
development,  commercialization  and continued system refinement and enhancement
efforts  remain  subject  to all of the risks  inherent  in  development  of new
products  based on  innovative  technologies,  including  unanticipated  delays,
expenses  and  technical  problems  or  difficulties,  as well  as the  possible
insufficiency of funds to implement  development efforts,  which could result in
abandonment or substantial  change in product  commercialization.  The Company's
success will be largely  dependent upon its products  meeting  targeted cost and
performance objectives of large-scale production, the Company's ability to adapt
its products to satisfy  industry  standards and the timely  introduction of its
products into the  marketplace,  among other  things.  There can be no assurance
that,  upon  wide-scale  commercial  introduction,  the  Company's  products and
software applications will satisfy current price or performance objectives, that
unanticipated  technical or other problems which would result in increased costs
or material delays in introduction and commercialization will not occur, or that
the Company's  products will prove to be sufficiently  reliable or durable under
actual operating  conditions or otherwise be commercially  viable.  Software and
other  technologies as complex as those  incorporated into the Company's systems
may contain  errors which become  apparent  subsequent to widespread  commercial
use. Remedying such errors could delay the Company's plans and cause it to incur
additional costs, having a material adverse impact on the Company. See "Business
- -- Products" and "-- Marketing and Sales."
   
   Concentration  of Revenue;  Dependence  on Key  Customers;  Concentration  of
Credit Risk. A substantial  portion of the  Company's  sales are made to a small
number of  customers,  generally  on an open  account  basis with no  collateral
required.  There can be no assurance  that these  customers  will maintain their
volume of business  with the  Company.  A loss of the  Company's  sales to these
customers  could  have a material  adverse  effect on the  Company's  results of
operations unless other customers were found to provide the Company with similar
revenues.  The Company performs  ongoing credit  evaluation of its customers and
maintains  reserves for  potential  credit  losses.  Although such losses in the
aggregate have not exceeded management's expectations, there can be no assurance
that  potential  credit  losses  will not  exceed  reserves  in the  future.  In
addition,  the Company invests its cash and cash  equivalents with two financial
institutions,  one a Texas  commercial  bank,  and the  other a major  brokerage
house.  Cash  balances at the Texas  commercial  bank are insured by the Federal
Deposit  Insurance  Corporation up to $100,000 and the brokerage house maintains
accounts in several banks  throughout the country and in government  securities.
Should either the Texas  commercial  bank or the brokerage  house cease business
operations,  there can be no assurance  that the Company will not suffer losses.
See "Management's  Discussion and Analysis of Financial Condition and Results of
Operations."    

   Uncertainty  of Market  Acceptance.  The DVC  industry  is  characterized  by
emerging and evolving  markets and an increasing  number of market  entrants who
have  introduced or are  developing  an array of new DVC systems.  Each of these
entrants is seeking to  establish  its  products as the  preferred  solution for
desktop video  applications.  As is typical in the case of emerging and evolving
markets, demand and market acceptance for newly introduced products and services
is subject to a high level of  uncertainty.  The Company  has not yet  commenced
significant  marketing  activities  relating  to product  commercialization  and
currently has limited marketing experience and limited financial,  personnel and
other resources to undertake extensive marketing activities. The Company has not
conducted and does not 
                                        9
<PAGE>
intend to conduct formal market or concept  feasibility studies for its proposed
products.  The relatively high cost and less than television  broadcast  quality
video of DVC  systems  have,  to date,  limited  the  market  acceptance  of DVC
systems.  Consequently,  potential customers may elect to utilize other products
which  they  believe to be more  efficient  or have  other  advantages  over the
Company's  products,  or may  otherwise be  reluctant to purchase the  Company's
products.  Achieving market  acceptance for the Company's  products will require
substantial  marketing  efforts and  expenditure of significant  funds to create
awareness  and demand by potential  consumers as to the  perceived  benefits and
distinctive characteristics of the Company's products. There can be no assurance
that the Company  will have  available  funds or other  resources  necessary  to
achieve such acceptance. See "Business -- Marketing and Sales."

   Limited  Marketing  Capabilities and Experience;  Dependence Upon Third-Party
Resellers.  The Company has limited marketing  experience and has conducted only
limited marketing activities. Although the Company expects to continue to market
directly  to  certain  accounts,  the  Company  intends  to use a portion of the
proceeds  of this  offering  to  establish  a network of  resellers,  consisting
primarily of value-added  resellers  ("VARs"),  systems integrators and original
equipment  manufacturers  ("OEMs")  with  established  distribution  channels to
market the Company's products and to educate potential  resellers to install and
service its systems.  The Company's prospects will be significantly  affected by
its ability to successfully develop relationships with VARs, systems integrators
and OEMs and upon the  marketing  efforts of such  resellers.  While the Company
believes that independent  resellers with which it enters into such arrangements
will have an economic motivation to market the Company's products,  the time and
resources  devoted to these  activities  generally  will be  controlled  by such
entities  and not by the Company.  The Company will also be dependent  upon such
resellers  to  provide  installation  and  support  services.  A decline  in the
financial  prospects  of  particular  resellers  or any of their  customers,  or
inadequate installation and support services by resellers, could have a material
adverse  effect on the Company.  In addition,  such resellers will likely market
various product lines,  including,  in some cases, products directly competitive
with the  Company's  products.  The Company has entered into  agreements  with a
limited number of resellers to distribute its products and has recently  entered
into   a   licensing   agreement   with   Boca   to   manufacture   and   market
FamilyFone(Trademark)  and related upgrades.  There can be no assurance that the
Company will be able, for financial or other reasons, to finalize any additional
third-party distribution or marketing arrangements or that such arrangements, if
finalized,  will  result in further  commercialization  of any of the  Company's
products.  See "Use of  Proceeds,"  "Management's  Discussion  and  Analysis  of
Financial  Condition and Results of  Operations"  and "Business -- Marketing and
Sales."

   Competition.   The  market  for  DVC  systems  is  highly   competitive   and
characterized by the frequent introduction of new products based upon innovative
technologies.  The Company competes with numerous well-established manufacturers
and  suppliers  of   videoconferencing,   networking,   telecommunications   and
multimedia  equipment  and  products,  certain of which  dominate  the  existing
video-conferencing  market for such products. In addition,  the Company is aware
of others  that are  developing,  and in some  cases  have  introduced,  new DVC
systems.  Most  of  the  Company's  competitors  possess  substantially  greater
financial,  marketing,  personnel  and other  resources  than the Company,  have
established  reputations relating to product design,  development,  manufacture,
marketing and service of networking,  telecommunications  and video products and
have significant budgets to permit them to implement  extensive  advertising and
promotional  campaigns to market new products in response to competitors.  Among
the Company's direct competitors are Target  Technologies,  Inc., VIVO Software,
Inc., Zydacron,  Inc., VCON, Ltd., Corel Corporation and Video LAN Technologies,
Inc. See "Business -- Competition."

   Technological  Obsolescence;  Need to  Conform  to  Industry  Standards.  The
markets  for the  Company's  products  are  characterized  by  rapidly  changing
technology  and  evolving  industry   standards,   often  resulting  in  product
obsolescence or short product lifecycles.  Accordingly, the Company's ability to
compete will depend in large part on its ability to introduce  its products in a
timely  manner,  to  continually  enhance and  improve  its system and  software
products and to maintain  development  capabilities  to  anticipate  or adapt to
technological  changes  and  advances  in the DVC and PC  industries,  including
ensuring   continuing   compatibility   with  evolving  industry  standards  and
technological advances.  There can be no assurance that the Company will be able
to compete  successfully,  that  competitors  will not develop  technologies  or
products that render the Company's products obsolete or less marketable, or 

                                       10
<PAGE>
that the Company will be able to keep pace with the technological demands of the
marketplace or successfully enhance and adapt its products to be compatible with
newly  developed  PC  and  networking  products  and  technologies  or  software
products,  or satisfy  industry  standards  and the needs of its  consumers  and
potential  consumers.  Industry  standards  covering the Company's  products are
being established by, among others, the International  Telecommunications Union.
Such  standards  will  provide for  acceptable  product  performance  levels and
interoperability and compatibility  standards. If such standards,  when adopted,
differ from the proposed  standards,  or are changed  after  adoption,  customer
confidence  in, and the market for, the  applicable  product  could be adversely
affected.  There can be no assurance  that such  standards will remain the same,
and if  changed,  that the  Company  will be able to  comply  with  any  changed
standards.  If any product  does not comply with the  applicable  standards  the
Company may have to discontinue  sales of such product until such time, if ever,
as  it  is  able  to  modify  or  redesign  its  technology.  In  addition,  the
establishment  of  standards  adverse  to the  Company's  system  could  provide
substantial  competitive advantages to manufacturers of other  videoconferencing
systems. In particular,  the Company's compressed packet video Codec utilized in
the  current  version of the  Viewpoint-PRO(Trademark)  system does not meet the
newly  proposed  applicable  standards  and the  Company  will have to modify or
redesign the non-conforming  portion of the product.  The project to upgrade the
Viewpoint-PRO  to the new industry  standards will involve the  development of a
new product based on a technology derivative of the Company's Osprey-1000 Codec.
The Company  estimates  that the project will take 8 man-months to complete at a
cost  of  approximately   $70,000.   The  Company  projects  that  the  upgraded
Viewpoint-PRO  will be  available  during 1997.  The  Research  and  Development
portion of the Use of Proceeds includes the cost of this project.  See "Business
- -- Competition."

   Dependence Upon Third-Party  Manufacturers and Suppliers. The Company has, to
date,  engaged small  contract  manufacturers  to supply its products in limited
quantities  pursuant  to purchase  orders.  There can be no  assurance  that its
products can be  manufactured  reliably on a large-scale  basis on  commercially
reasonable terms, or at all. In addition, the Company has been and will continue
to be dependent on third  parties for the supply and  manufacture  of all of its
component  and  electronic  parts,   including   standard  and   custom-designed
components.  The Company generally does not maintain supply agreements with such
third parties but instead purchases  components and electronic parts pursuant to
purchase orders in the ordinary course of business. The Company is substantially
dependent on the ability of its  third-party  manufacturers  and  suppliers  to,
among  other  things,  meet  the  Company's  design,   performance  and  quality
specifications.

   Failure by the Company's  third-party  manufacturers  and suppliers to comply
with these and other  requirements  could have a material  adverse effect on the
Company. There can be no assurance that the Company's third-party  manufacturers
and suppliers will dedicate sufficient production capacity to meet the Company's
scheduled delivery requirements or that the Company's suppliers or manufacturers
will have sufficient  production capacity to satisfy the Company's  requirements
during any period of sustained demand.  Moreover,  the electronics industry from
time to time experiences short supplies of certain high demand components, which
may adversely  affect the Company's  ability to meet its  production  schedules.
Furthermore,  although  the  Company  owns the  designs  and dies for its custom
designed  components  and  believes  that  alternative  sources  of  supply  are
available,  the  Company  currently  purchases  all  of its  specially  designed
components  and certain  high  demand  components  from sole  source  suppliers.
Failure of  manufacturers  or suppliers to supply,  or delays in supplying,  the
Company with systems or components, or allocations in the supply of certain high
demand components could materially adversely affect the Company's operations and
ability to meet its own delivery schedules on a timely and competitive basis.
See "Business -- Production and Supply."

   
     Broad  Discretion  in  Application  of Proceeds.  Approximately  $2,619,600
(31.7%) of the estimated  net proceeds from this offering has been  allocated to
working capital and general corporate  purposes.  Accordingly,  the Company will
have broad  discretion as to the  application  of such  proceeds.  "Management's
Discussion  and Analysis of Financial  Condition  and Results of  Operations  --
Liquidity" and "Description of Securities."

     Offering Benefits Directors and Selling Securityholders;  Proceeds to Repay
Indebtedness. The Company will use a portion of the proceeds of this offering to
(i) repay  $222,548  principal  amount of Secured  and Demand  Notes,  including
$200,000 payable to Glenn A. Norem, CEO of the Company, plus accrued 


                                       11


<PAGE>
interest  of  approximately  $13,933  on the  Secured  and  Demand  Notes,  (ii)
repayment of $347,250 principal amount of Convertible Debt plus accrued interest
of  approximately  $97,898  and,  (iii)  payment of accrued  expenses  and trade
accounts payable of approximately  $420,000 (iv) repayment of $500,000 principal
amount of Convertible Debt II plus accrued interest of approximately $31,123 and
(v) repayment of $850,000  principal amount of Bridge Debt plus accrued interest
of approximately $6,641. See "Management's  Discussion and Analysis of Financial
Condition  and  Results  of  Operations  --  Liquidity"  and   "Description   of
Securities."     

   Patents,  Trademarks and Proprietary Information.  The Company holds a United
States patent  covering  certain  fundamental  aspects of the compressed  packet
video Codec incorporated into the  Viewpoint-PRO(Trademark)  system. The Company
may apply for additional  patents  relating to other aspects of its products and
has  applied  for  trademark  registration  for  the   Viewpoint-PRO(Trademark),
ViewCast(Trademark),       Osprey-1000(Trademark),        SLIC-Video(Trademark),
FamilyFone(Trademark), and WorkFone(Trademark) names, among others. There can be
no assurance as to the breadth or degree of protection  which existing or future
patents,  if any,  may afford the  Company,  that any patent  applications  will
result in issued  patents,  that the  Company's  patents or  trademarks  will be
upheld, if challenged,  or that competitors will not develop similar or superior
methods or products  outside the protection of any patent issued to the Company.
Although the Company  believes that its patent and  trademarks and the Company's
products  do not and will not  infringe  patents or  trademarks  or violate  the
proprietary  rights of others, it is possible that the Company's existing patent
or trademark rights may not be valid or that  infringement of existing or future
patents,  trademarks or proprietary rights may occur. In the event the Company's
products  infringe patents or proprietary  rights of others,  the Company may be
required to modify the design of its  products,  change the name of its products
or obtain a license for certain  technology.  There can be no assurance that the
Company  will be able to do so in a timely  manner,  upon  acceptable  terms and
conditions,  or at all. Failure to do any of the foregoing could have a material
adverse effect upon the Company. In addition, there can be no assurance that the
Company  will have the  financial  or other  resources  necessary  to enforce or
defend a patent infringement or proprietary rights violation action which may be
brought  against it.  Moreover,  if the  Company's  products  infringe  patents,
trademarks or proprietary  rights of others,  the Company  could,  under certain
circumstances,  become  liable  for  damages,  which  also could have a material
adverse effect on the Company.

   The Company also relies on  confidentiality  agreements  with its  directors,
employees,  consultants and manufacturers and employs various methods to protect
the source codes, concepts, ideas, proprietary know-how and documentation of its
proprietary technology. However, such methods may not afford complete protection
and there can be no assurance that others will not independently develop similar
know-how or obtain access to the Company's know-how or software codes, concepts,
ideas and  documentation.  Furthermore,  although the Company has and expects to
continue  to have  confidentiality  agreements  with its  directors,  employees,
consultants,  manufacturers and appropriate  vendors,  there can be no assurance
that such arrangements will adequately protect the Company's trade secrets.  See
"Business -- Patents, Trademarks and Proprietary Information."

   Risks Relating to Proposed  Expansion;  Risks Relating to Foreign Operations.
The Company  intends to use the proceeds of this  offering to seek to expand its
current level of operations.  Successful  expansion of the Company's  operations
will be  dependent,  among other  things,  on the  Company's  ability to achieve
significant  market  acceptance  for  its  products,  hire  and  retain  skilled
management,  marketing,  technical and other  personnel,  establish an effective
sales organization and enter into satisfactory  marketing  arrangements,  secure
adequate  sources  of supply on a timely  basis and on  commercially  reasonable
terms,  and  successfully  manage  growth  (including   monitoring   operations,
controlling  costs and maintaining  effective  quality  controls).  Although the
Company, as of the date of the Prospectus, has no agreements,  understandings or
commitments and is not engaged in any negotiations relating thereto, the Company
could also seek to expand its operations through acquisitions. In such an event,
investors  in this  offering  would  not have an  opportunity  to  evaluate  the
specific  merits or risks of any  potential  acquisition.  In  addition,  to the
extent the Company enters into foreign  markets,  the Company will be subject to
all of the risks inherent in foreign trade, including trade restrictions, export
duties  and  tariffs,  fluctuations  in  foreign  currencies  and  international
political,  regulatory and economic developments  affecting foreign trade. There
can be no  assurance  that the Company will be able to  successfully  expand 

                                       12

<PAGE>
its  operations  or that  the  Company  will not  remain  largely  dependent  on
non-recurring  system  sales  to a  limited  customer  base,  which  sales  will
constitute all or a significant  portion of the Company's  revenue.  See "Use of
Proceeds" and "Business -- Government Regulation."

   Possible  Fluctuations in Operating Results.  The Company's operating results
could  vary from  period to  period as a result of the  length of the  Company's
sales cycle, as well as from  purchasing  patterns of potential  customers,  the
timing of  introduction  of new  products,  software  applications  and  product
enhancements  by  the  Company  and  its  competitors,   technological  factors,
variations in sales by distribution channels, competitive pricing, and generally
nonrecurring  system sales.  The Company's  sales order cycle,  which  generally
commences at a time a prospective  user  demonstrates  an interest in purchasing
one of the Company's  products and ends upon  execution of a purchase order with
that  customer,  could  range from one to eighteen  months.  The period from the
execution  of a  purchase  order  until  delivery  of system  components  to the
Company,  assembly and shipment,  at which time the Company recognizes  revenue,
may range from approximately one to four months. Although the Company intends to
use a portion of the proceeds of this offering to purchase additional  component
parts,  which the Company  believes may reduce the length of its  production and
delivery  cycle,  there can be no  assurance  that such  factors  will not cause
significant fluctuations in operating results in the future.  Additionally,  the
Company  anticipates  that upon  entering  into  agreements  with  resellers for
distribution of the Company's products, of which there can be no assurance, such
distributors may place initial stocking orders for systems,  component parts and
software  programs,  which  could also result in  material  fluctuations  in the
Company's  operating  results.  See  "Management's  Discussion  and  Analysis of
Financial  Condition and Results of Operations"  and "Business -- Production and
Supply."

   Limitations  on Use of Net  Operating  Loss Carry  Forwards.  At December 31,
1995, the Company had  substantial net operating loss carry forwards for federal
tax purposes available to offset future taxable income. Under Section 382 of the
Internal  Revenue Code of 1986, as amended,  utilization  of prior net operating
loss carry forwards is limited after an ownership  change, as defined in Section
382.  There  can be no  assurance  that the  Company  will not in the  future be
subject to further significant  limitations on the use of its net operating loss
carry forwards.  In the event the Company achieves  profitable  operations,  any
significant  limitation on the  utilization of net operating loss carry forwards
would have the effect of increasing the Company's tax liability and reducing net
income and available cash resources.  See "Management's  Discussion and Analysis
of Financial Condition and Results of Operations -- Liquidity."

   Government  Regulation.  The  Company is subject to  regulations  relating to
electromagnetic  radiation from its products, which impose compliance burdens on
the  Company.  In the event the Company  redesigns  or  otherwise  modifies  its
products or completes the  development  of new products,  it will be required to
comply with Federal  Communications  Commission regulations with respect to such
products  prior to their  commercialization.  There can be no assurance that the
Company  will be  able  to  comply  with  such  regulations.  In  addition,  new
legislation  and  regulations,  as  well  as  revisions  to  existing  laws  and
regulations at the federal, state and local levels may be proposed in the future
affecting the video communications  industries.  Such proposals could affect the
Company's  operations,  result in  material  capital  expenditures,  affect  the
marketability  of its  products  and limit  opportunities  for the Company  with
respect to  modifications  of its  products  or with  respect to new or proposed
products or  technologies.  Expansion into foreign  markets may also require the
Company  to comply  with  additional  regulatory  requirements.  The  technology
contained  in the  Company's  products may be subject to U.S.  export  controls.
There can be no assurance  that such export  controls,  either in their  current
form or as may be  subsequently  enacted,  will not  delay  introduction  of new
products or limit the Company's  ability to distribute  products  outside of the
United  States.  Further,  various  countries may regulate the import of certain
technologies  contained  in the  Company's  products.  Any such export or import
restrictions,  new  legislation  or  regulation  or  government  enforcement  of
existing  regulations  could have a  material  adverse  effect on the  Company's
business,  operating  results  and/or  financial  condition.  There  can  be  no
assurance  that the Company  will be able to comply with  additional  applicable
laws and regulations without excessive cost or business interruption, if at all,
and failure to comply could have a material  adverse effect on the Company.  See
"Business -- Government Regulation."

   Dependence  on Key  Personnel.  The  success of the  Company  will be largely
dependent  on the  personal  efforts  of Glenn A.  Norem,  its  Chief  Executive
Officer,  and  other  key  personnel.  The  Company  entered  into  a  five-year
employment  agreement  with Mr. Norem in February 1994. All other key per-
                                       13

<PAGE>
   
sonnel,  including  Philip M.  Colquhoun,  President of the Company,  William S.
Leftwich,  Chief  Financial  Officer  of the  Company,  David  T.  Stoner,  Vice
President of Operations of the Company, Neal S. Page, Vice President and General
Manager of Osprey, A. David Boomstein, Vice President of Business Development of
the Company and Daniel W.  Dodson,  Vice  President of Marketing of the Comapny,
are "at-will" employees by terms of their employment agreements.  The employment
of each such key employee  may  therefore  be  terminated  by the officer or the
Company at any time,  for any reason or no reason.  The loss of the  services of
Mr. Norem or certain other key employees could have a material adverse effect on
the Company's business and prospects. The Company plans to obtain "key-man" life
insurance on the life of Mr. Norem in the amount of  $1,000,000.  The success of
the  Company is also  dependent  upon its  ability to hire and retain  qualified
operational,  financial,  technical, marketing, sales and other personnel. There
can be no  assurance  that  the  Company  will be able  to hire or  retain  such
necessary personnel. See "Business -- Employees" and "Management."

   Control  by  Current  Principal  Stockholders;   Potential   Representative's
Influence on the Company Upon Exercise of Right to Designate Board Member.  Upon
the  consummation  of  this  offering,  the  officers,  directors  and  existing
stockholders of the Company will  beneficially  own  approximately  75.4% of the
Company's outstanding Common Stock (72.8% if the Representatives' over-allotment
option is exercised in full). While these persons will not individually  control
a majority  of the shares of Common  Stock of the  Company,  they may be able to
effectively  control the decisions on matters  including  election of all of the
Company's  directors,  increasing  the authorized  capital  stock,  dissolution,
merger or sale of the assets of the Company and  generally may be able to direct
the affairs of the Company. In addition,  upon consummation of the offering, the
Representative  has been  granted,  for a period  of five  years,  the  right to
designate a person to serve as a director of the Company.  If the Representative
were to exercise such right, it could be deemed under certain  circumstances  to
be in a  position  to  assert  influence  over the  Company.  See  "Management,"
"Principal Stockholders" and "Certain Transactions."

   Significant  Outstanding Options and Warrants. As of September 30, 1996 there
were  outstanding  stock  options to  purchase  an  aggregate  of  approximately
2,080,590  shares of Common Stock at exercise  prices ranging from $.04 to $4.00
per share and  warrants to  purchase an  aggregate  of  approximately  1,442,505
shares of Common Stock at prices  ranging from $1.00 to $3.00 per share.  To the
extent that  outstanding  options and  warrants are  exercised,  dilution to the
Company's  stockholders will occur.  Moreover,  the terms upon which the Company
will be able to obtain  additional  equity  capital  may be  adversely  affected
because  the holders of  outstanding  options  and  warrants  can be expected to
exercise them at a time when the Company would,  in all  likelihood,  be able to
obtain  any  needed  capital on terms more  favorable  to the  Company  than the
exercise  terms  provided by such  outstanding  securities.  See  "Management --
Employee Stock Plans" and "Certain Transactions."

   Immediate and Substantial  Dilution.  Assuming all 1,800,000 shares of Common
Stock offered  hereby are sold at an assumed  initial  public  offering price of
$5.50 per share and $0.10 per Public  Warrant,  this  offering  will  involve an
immediate  and  substantial  dilution of $4.69 (85.3%) per share between the pro
forma net tangible book value per share of Common Stock and the offering  price.
The Company  believes  that the net  proceeds  of this  offering  together  with
available cash will be sufficient to meet the Company's  operating  expenses and
capital   requirements  for  at  least  the  next  twelve  months.  The  Company
anticipates  that  additional  funding will be required after the use of the net
proceeds of this offering. Such additional funding will likely result in further
dilution to the Company's stockholders. See "Dilution."     

     No  Dividends.  The Company has not paid any cash  dividends  on its Common
Stock  and  does  not  expect  to  declare  or pay  any  cash  dividends  in the
foreseeable future.  Certain of the Company's debt instruments include covenants
precluding the payment of cash dividends  until after such debt  instruments are
repaid. See "Dividends."

   Authorization  and  Discretionary  Issuance of Preferred Stock. The Company's
Certificate of Incorporation  authorizes the issuance of "blank check" preferred
stock with such  designations,  rights and preferences as may be determined from
time to time by the Board of Directors.  Accordingly,  the Board 

                                       14

<PAGE>
of Directors is empowered,  without  stockholder  approval,  to issue  preferred
stock with dividend, liquidation, conversion, voting or other rights which could
adversely  affect  the  voting  power  or other  rights  of the  holders  of the
Company's  Common Stock. In the event of issuance,  the preferred stock could be
utilized, under certain circumstances, as a method of discouraging,  delaying or
preventing  a change in control of the  Company.  Although  the  Company  has no
present  intention to issue any shares of its preferred  stock,  there can be no
assurance  that the Company will not do so in the future.  See  "Description  of
Securities -- Preferred Stock."

   Limitation on Monetary  Liability of Officers and Directors to  Stockholders.
Section 145 of the  General  Corporation  Law of the State of Delaware  contains
provisions  entitling  directors and officers of the Company to  indemnification
from  judgments,  fines,  amounts paid in settlement  and  reasonable  expenses,
including  attorney's  fees,  as the result of an action or  proceeding in which
they may be  involved by reason of being or having been a director or officer of
the Company  provided said officers or directors  acted in good faith.  Articles
Seven and Ten of the Company's  Certificate of Incorporation  contain provisions
indemnifying  officers  and  directors  of the  Company  to the  fullest  extent
permitted by Delaware law. These provisions provide,  among other things, that a
director  of the  Company  shall not be  liable  either  to the  Company  or its
stockholders  for monetary  damages for breach of fiduciary  duty as a director.
The Company has also entered into indemnification agreements with Messrs. Norem,
Leftwich,  Colquhoun,  Stoner,  Dodson,  Boomstein,  Page,  Jobe, and Culp which
provide for  indemnification  to the fullest extent  allowable under the laws of
the State of Delaware.  These  provisions may limit the ability of the Company's
stockholders to collect on any monetary  liability owed to them by an officer or
director of the Company.

   Arbitrary  Determination of Offering Price. The initial public offering price
of the Common Stock and the exercise price and terms of the Public Warrants have
been  determined  arbitrarily  by  negotiations  between  the  Company  and  the
Representatives.  Factors  considered  in  such  negotiations,  in  addition  to
prevailing  market  conditions,  included  the  history  and  prospects  for the
industry  in  which  the  Company  competes,  an  assessment  of  the  Company's
management,  the  prospects of the Company,  its capital  structure  and certain
other factors  deemed  relevant.  Therefore,  the public  offering  price of the
Common  Stock and the  exercise  price and terms of the Public  Warrants  do not
necessarily bear any relationship to established  valuation criteria and may not
be indicative of prices that may prevail at any time or from time to time in the
public market for the Common Stock. See "Underwriting."

   
   Shares Eligible for Future Sale;  Registration  Rights. Upon the consummation
of this  offering,  the  Company  will have  7,331,558  shares  of Common  Stock
outstanding  (7,601,558 shares if the Representatives'  over-allotment option is
exercised in full)(assuming no exercise of outstanding options and warrants). Of
these shares,  the 1,800,000 shares sold in this offering  (2,070,000  shares if
the Representatives' over-allotment option is exercised in full) and the 477,244
shares of Common  Stock  registered  concurrently  with  this  Prospectus  being
offered  pursuant  to the  Selling  Securityholder  Prospectus  included  in the
Registration  Statement  of which  this  Prospectus  forms a part will be freely
tradeable,  subject to "lock-up"  agreements  (see  "Shares  Eligible for Future
Sale"),  under  the  Securities  Act,  except  for any  shares  purchased  by an
"affiliate" of the Company (in general, a person who has a control  relationship
with the  Company),  which shares will be subject to the resale  limitations  of
Rule 144 adopted under the Securities  Act. The remaining  5,054,314  shares are
deemed to be  "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 and are
not  currently  part  of  an  effective   registration.   Except  for  "lock-up"
agreements,  such shares are eligible for sale under Rule 144, or will become so
eligible at various  times through  October  1996. In addition,  the Company has
granted  the  Representatives  demand and  piggyback  registration  rights  with
respect  to the  securities  issuable  upon  exercise  of  the  Representatives'
Warrants.     

   Under Rule 144, a stockholder who has beneficially  owned  Restricted  Shares
for  at  least  two  (2)  years  (including  persons  who  may be  deemed  to be
"affiliates"  of the Company under Rule 144) may sell within any three (3) month
period a number of shares  that does not exceed the  greater  of: a) one percent
(1%) of the then  outstanding  shares  of a  particular  class of the  Company's
Common Stock as reported on its 10-Q filing,  or b) the average weekly volume on
NASDAQ during the four (4) calendar 
                                       15

<PAGE>
weeks  preceding  such sale and may only sell such  shares  through  unsolicited
brokers'  transactions.  A  stockholder  who is  not  deemed  to  have  been  an
"affiliate"  of  the  Company  for  at  least  ninety  (90)  days  and  who  has
beneficially  owned his shares for at least three (3) years would be entitled to
sell  such  shares  under  Rule 144  without  regard to the  volume  limitations
described above.

   There has been no public market for the  securities of the Company.  Sales of
substantial  amounts of shares of the Company's  Common Stock,  pursuant to Rule
144 or otherwise,  could adversely  affect the market price of the Common Stock,
and  consequently  make  it  more  difficult  for the  Company  to  sell  equity
securities  in  the  future  at  a  time  and  price  which  the  Company  deems
appropriate.   See  "Shares  Eligible  for  Future  Sale,"  "Underwriting,"  and
"Concurrent Registration of Securities."
   
   NASDAQ Maintenance Requirements; Possible Delisting of Securities from NASDAQ
System; Risks of Low-Priced Stocks.  NASDAQ has proposed rule changes increasing
its  quantitative  listing  standards  which,  if  enacted,  would  make it more
difficult  for  the  Company  to  maintain   compliance  with  NASDAQ's  listing
requirements.  If the Company is unable to satisfy NASDAQ's maintenance criteria
in the future, its securities will be subject to being delisted, and trading, if
any,  would  thereafter  be  conducted  in the  over-the-counter  market  in the
so-called  "pink  sheets" or the  "Electronic  Bulletin  Board" of the  National
Association  of Securities  Dealers,  Inc.  ("NASD").  As a consequence  of such
delisting,  an investor could find it more difficult to dispose of, or to obtain
accurate quotations as to the price of, the Company's securities.
    
   The  Securities  Enforcement  and Penny  Stock  Reform  Act of 1990  requires
additional disclosure relating to the market for penny stocks in connection with
trades in any stock  defined as a penny stock.  The SEC has adopted  regulations
that generally  define a penny stock to be any equity security that has a market
price of less  than  $5.00  per  share,  subject  to  certain  exceptions.  Such
exceptions  include any equity security listed on NASDAQ and any equity security
issued by an issuer that has (i) net tangible assets of at least $2,000,000,  if
such issuer has been in continuous  operation for three years, (ii) net tangible
assets of at least $5,000,000,  if such issuer has been in continuous  operation
for  less  than  three  years,  or  (iii)  average  annual  revenue  of at least
$6,000,000 if such issuer has been in  continuous  operation for less than three
years.  Unless an exception is available,  the regulations require the delivery,
prior to any  transaction  involving a penny  stock,  of a  disclosure  schedule
explaining the penny stock market and the risks associated therewith.

   In addition,  if the Company's  securities  are not quoted on NASDAQ,  or the
Company does not have $2,000,000 in net tangible  assets,  trading in the Common
Stock would be covered by Rule 15g-9 promulgated  under the Securities  Exchange
Act of 1934, as amended,  (the "Exchange  Act") for non-NASDAQ and  non-exchange
listed securities. Under such rule, broker/dealers who recommend such securities
to persons other than established customers and accredited investors must make a
special  written  suitability  determination  for the  purchaser and receive the
purchaser's  written agreement to a transaction  prior to sale.  Securities also
are exempt from this rule if the market price is at least $5.00 per share.

   The  Company's  Common  Stock,  as of the  date  of this  Prospectus,  is not
technically  within the definitional  scope of a penny stock, and is expected to
be exempt from the definition of penny stock by operation of law because it will
be  listed  on  NASDAQ.  However,  in the  event  that  the  Common  Stock  were
subsequently to become  characterized as a penny stock, the market liquidity for
the  Company's  securities  could be severely  affected.  In such an event,  the
regulations   on  penny   stocks   could   effectively   limit  the  ability  of
broker/dealers  to sell  the  Company's  securities  and  thus  the  ability  of
purchasers of the Company's securities to sell their securities in the secondary
market.

   Warrants  Redeemable at Nominal Price.  The Public Warrants are redeemable by
the  Company  at any  time  commencing  eighteen  months  from  the date of this
Prospectus,  for $.10 per Public  Warrant  upon thirty  (30) days prior  written
notice, provided that the average closing price or bid price of the Common Stock
for any twenty (20) trading days within the thirty (30) consecutive trading days
ending on the fifth day prior to notice of redemption  equals or exceeds $ (250%
of the then effective  exercise price of the Public Warrants.  Redemption of the
Public  Warrants by the Company  could force the holders to exercise  the Public
Warrants and pay the exercise price at a time when it may be disad-

                                       16
<PAGE>
vantageous  for the  holders to do so, to sell the Public  Warrants  at the then
current market price when they might otherwise wish to hold the Public Warrants,
or to accept the redemption price, which is likely to be substantially less than
the market value of the Public Warrants at the time of redemption.  In the event
of the exercise of a substantial  number of Public  Warrants within a reasonably
short  period of time  after  the right to  exercise  commences,  the  resulting
increase  in the amount of Common  Stock of the  Company in the  trading  market
could   substantially   affect  the  market  price  of  the  Common  Stock.  See
"Description of Securities -- Warrants."

   Legal  Restrictions  on Sales of Shares  Underlying the Warrants.  The Public
Warrants are not exercisable  unless,  at the time of the exercise,  the Company
has a current  prospectus  covering  the shares of Common  Stock  issuable  upon
exercise of the Public Warrants, and such shares have been registered, qualified
or deemed to be exempt  under the  securities  laws of the state of residence of
the exercising holder of the Public Warrants. Although the Company has agreed to
keep a registration  statement covering the shares of Common Stock issuable upon
the  exercise  of the  Public  Warrants  effective  for the  term of the  Public
Warrants,  if it fails  to do so for any  reason,  the  Public  Warrants  may be
deprived of value.

   The Common Stock and Public Warrants are separately transferable  immediately
upon issuance.  Purchasers may buy Public Warrants in the aftermarket in, or may
move to,  jurisdictions  in which the shares  underlying the Public Warrants are
not so  registered or qualified  during the period that the Public  Warrants are
exercisable. In this event, the Company would be unable to issue shares to those
persons  desiring  to  exercise  their  Public  Warrants,  and holders of Public
Warrants  would have no choice but to attempt to sell the Public  Warrants  in a
jurisdiction where such sale is permissible or allow them to expire unexercised.
See "Description of Securities."



                                       17
<PAGE>

                               USE OF PROCEEDS

   
   Assuming  the sale of the  securities  offered  hereby  (based on an  assumed
offering price of $5.50 per Share and $.10 per Public Warrant), the net proceeds
to the Company, after deducting estimated underwriting discounts and commissions
and  expenses  payable by the  Company in  connection  with this  offering,  are
estimated to be  approximately  $8,269,600  ($9,585,040 if the  Representatives'
over-allotment  option is  exercised in full).  The Company  expects to use such
proceeds as follows:     

<TABLE>
<CAPTION>
                                                                APPROXIMATE
                 APPLICATION OF NET PROCEEDS                   DOLLAR AMOUNT    % OF PROCEEDS
- ------------------------------------------------------------  --------------- ----------------
<S>                                                           <C>             <C>
Repayment of outstanding accounts payable and
indebtedness(1).............................................  $2,490,000       30.1
Research and development(2) ................................   1,960,000       23.7
Marketing and sales(3) .....................................   1,200,000       14.5
Working capital and general corporate purposes(4)  .........   2,619,600       31.7
                                                              --------------- ----------------
   Total ...................................................  $8,269,600      100.0
                                                              =============== ================
</TABLE>
- ----------
   
(1)  Represents (i) the repayment of $222,548  principal amount of Secured Notes
     and Demand Notes plus accrued interest of approximately $13,933,  including
     $200,000  principal  amount of Secured  Notes and Demand  Notes  payable to
     Glenn A. Norem,  CEO of the Company;  (ii) repayment of $347,250  principal
     amount of Convertible Debt plus accrued interest of $97,898,  (iii) payment
     of accrued expenses and trade accounts  payable of approximately  $420,000,
     (iv) repayment of $500,000  principal  amount of  Convertible  Debt II plus
     accrued  interest of  approximately  $31,123 and (v)  repayment of $850,000
     principal  amount of Bridge Debt plus  accrued  interest  of  approximately
     $6,641.  See "Management's  Discussion and Analysis of Financial  Condition
     and Results of Operations -- Liquidity" and  "Description  of  Securities."
         

(2)  Includes  amounts  associated with continued  refinement and enhancement of
     the  Company's  products and amounts  associated  with the  development  of
     additional products.

(3)  Represents   anticipated   costs   associated   with  marketing  and  sales
     activities,  including  approximately $250,000 for the cost of print media,
     participation in trade shows and direct mailings and approximately $400,000
     for the salaries of four additional marketing and sales personnel and three
     additional customer support personnel.

(4)  Includes  amounts  for  the  payment  of  salaries  of  executive  officers
     anticipated  to be  approximately  $385,000  over the 12  months  following
     consummation of this offering. See "Management," "Certain Transactions" and
     "Business -- Production and Supply."

   In the event that the  Company's  plans change or its  assumptions  change or
prove to be inaccurate or if the proceeds of this offering prove insufficient to
fund  operations (due to  unanticipated  expenses or difficulties or otherwise),
the  Company  may find it  necessary  or  advisable  to  reallocate  some of the
proceeds within the  above-described  categories or to use portions  thereof for
other  purposes or may be required to seek  additional  financing or curtail its
operations.  Future events, including changes in economic or industry conditions
or the  Company's  planned  operations,  may require the Company to use proceeds
allocated to working  capital for  marketing  and sales or  reallocate  proceeds
among the  various  intended  uses if it is  determined  at a later date that an
increase in such  expenditures  or  reallocation  of proceeds  is  necessary  or
desirable. Any such determination would be based on, among other things, whether
and to what extent revenue from systems sales is sufficient to offset  operating
expenses and the capital  requirements  associated with maintaining an inventory
of system  components.  Alternatively,  the Company may use less of the proceeds
for  marketing  and sales in the event  that such  initial  efforts  prove  more
successful than anticipated or the Company  generates  sufficient cash flow from
operations to otherwise fund such efforts.

   The Company  may, if and when the  opportunity  arises,  use a portion of the
proceeds  of this  offering  allocated  to working  capital,  together  with the
issuance of debt or equity  securities,  to acquire rights to technology  and/or
products or to acquire existing companies in businesses the Company believes are
compatible with its business.  Any decision to make such an acquisition  will be
based upon a variety of factors, including, among others, the purchase price and
other financial terms of the transaction, the business prospects and competitive
position of, and technology or products  provided by, the acquisition  candidate
and the extent to which any  technology or business  would enhance the Company's
prospects.

                                       18

<PAGE>
Potential  acquisition   candidates  may  include  companies  with  products  or
technologies  that are  compatible  with  the  Company's  products,  or that the
Company  believes  would  provide  the  Company  with  additional   distribution
channels.  As of the date of this  Prospectus,  the Company  has no  agreements,
understandings or arrangements  with respect to any such acquisition.  There can
be no assurance  that the Company will be able to  successfully  consummate  any
acquisition or successfully integrate any acquired business into its operations.
Investors in this offering will not have an opportunity to evaluate the specific
merits or risks of any acquisition.

   The Company  believes  that the net proceeds of this  offering  together with
available cash will be sufficient to meet the Company's  operating  expenses and
capital   requirements  for  at  least  the  next  twelve  months.  The  Company
anticipates  that  additional  funding will be required after the use of the net
proceeds  of the  offering.  No  assurance  can be given  that  such  additional
financing will be available when needed on terms  acceptable to the Company,  if
at all. See "Risk Factors --  Significant  Capital  Requirements;  Dependence on
Offering Proceeds; Possible Need for Additional Financing."

   Proceeds  not  immediately  required for the purposes set forth above will be
invested in short-term, investment-grade, interest-bearing securities.

                                  DIVIDENDS

   The Company has never paid cash  dividends on its Common Stock.  The Board of
Directors does not anticipate paying cash dividends in the foreseeable future as
it intends to retain future earnings to finance the growth of the business.  The
payment of future cash dividends will depend on such factors as earnings levels,
anticipated capital  requirements,  the operating and financial condition of the
Company and other factors deemed relevant by the Board of Directors.

   Certain  of the  Company's  debt  instruments  include  covenants  precluding
payment of cash dividends until after such debt instruments are repaid.

                                       19
<PAGE>
                                   DILUTION

   The  difference  between the offering price per share of Common Stock and the
pro forma as adjusted  net  tangible  book value per share of Common Stock after
this  offering  constitutes  the  dilution to investors  in this  offering.  Net
tangible  book value per share on any given date is  determined  by dividing the
net tangible book value (total  tangible  assets less total  liabilities) of the
Company on such date by the number of shares of Common Stock outstanding on such
date.

   
   After  giving  effect  to the pro  forma  adjustments  (see  Footnote  (2) to
"Prospectus Summary -- Summary  Consolidated  Financial  Information"),  the pro
forma  net  tangible  book  value  of the  Company  at  September  30,  1996 was
$(5,005,062),  or $(.99) per share of Common  Stock.  After giving effect to (i)
the sale of  1,800,000  shares of Common  Stock and  1,800,000  Public  Warrants
offered by the Company  hereby (based on an assumed  offering price of $5.50 per
share and $.10 per Public Warrant) (less underwriting  discounts and commissions
and estimated expenses of this offering) and (ii) the issuance of 477,244 shares
of Common Stock issued on the date of this  Prospectus  upon the  conversion  of
$2,330,300  principal  amount of  Convertible  Debt and  approximately  $342,294
accrued interest (based on an assumed offering price of $5.50 per share and $.10
per Public  Warrant),  the pro forma as adjusted net tangible  book value of the
Company at  September  30,  1996 would have been  $5,937,132  or $.81 per share,
representing  an immediate  increase in pro forma as adjusted net tangible  book
value of $1.80 per share to existing  stockholders and an immediate  dilution of
$4.69 per share  (85.3%) to  investors.  The  following  table  illustrates  the
foregoing  information  with respect to dilution to new investors on a per share
basis:     

     Assumed public offering price(1)......................           $5.50
       Pro Forma net tangible book value before offering...  $(.99)
       Increase attribute to new investors.................   1.80
                                                             --------
     Pro Forma as adjusted net tangible book value after
     offering..............................................             .81
                                                                      --------
     Dilution to new investors(2)..........................           $4.69
                                                                      ========
- ----------

(1)  Offering price before  deduction of estimated  expenses of the offering and
     underwriting  discounts and commissions and exclusive of the purchase price
     of $.10 per Public Warrant.

   
(2)  Assumes no exercise of the Representatives'  over-allotment option. The pro
     forma net  tangible  book value of Common  Stock after the offering and the
     Dilution to new  investors,  assuming  the  Representatives'  overallotment
     option is  exercised  in full,  would be  approximately  $.95 and $4.55 per
     share, respectively.

   The following table sets forth a comparison of the number of shares of Common
Stock  acquired from the Company by the Company's  stockholders  as of September
30, 1996 on a pro forma basis and by investors in this offering,  the percentage
ownership of such shares, the total  consideration paid, the percentage of total
consideration paid, and the average price per share:     

<TABLE>
<CAPTION>
                          SHARES PURCHASED      TOTAL CONSIDERATION
                       ---------------------- -----------------------  AVERAGE PRICE
                          NUMBER     PERCENT      AMOUNT     PERCENT    PER SHARE
                       ------------ ---------   ---------    --------  -------------
<S>                    <C>          <C>       <C>           <C>       <C>
Existing
stockholders.........  5,054,314     73.7     $ 7,662,518    43.6     $1.52
New investors .......  1,800,000     26.3       9,900,000    56.4     $5.50
                       ------------ --------- ------------- --------- ---------------
    Total............  6,854,314    100.0     $17,562,518   100.0
                       ============ ========= ============= =========

</TABLE>

   The above table  assumes no exercise of the  Representatives'  over-allotment
option. If the Representatives'  over-allotment option is exercised in full, the
new investors will have paid  $11,385,000 for 2,070,000  shares of Common Stock,
representing  approximately 59.8% of the total  consideration,  for 29.1% of the
total number of shares of Common Stock outstanding.

                                       20

<PAGE>
   
   The foregoing table also assumes no exercise of outstanding  stock options or
warrants or conversion of convertible  debt. As of the date of this  Prospectus,
there were (i)  outstanding  stock  options to purchase  51,100 shares of Common
Stock at $.04 per share, 70,000 shares of Common Stock at $.10 per share, 52,449
shares of Common  Stock at $.20 per  share,  222,633  shares of Common  Stock at
$2.20 per share,  130,000  shares of Common Stock at $2.42 per share,  1,265,141
shares of Common  Stock at $3.00 per share,  160,000  shares of Common  Stock at
$3.30 per share and  126,000  shares of Common  Stock at $4.00 per  share,  (ii)
957,975  shares of Common Stock  reserved for issuance  upon exercise of options
available  for  future  grant  under  the  1995  Option  Plan,  (iii)  1,280,900
Convertible Debt Warrants,  (iv) warrants to purchase 1,442,505 shares of common
stock and (v) 2,277,244  Public  Warrants.  To the extent that these options and
warrants are exercised,  there will be further  dilution to new  investors.  See
"Management  --  Employee  Stock  Plans,"   "Description   of  Securities"   and
"Underwriting."     

                                       21
<PAGE>
                                CAPITALIZATION

   
   The following  sets forth the  capitalization  of the Company as of September
30, 1996 (A) on an actual basis, (B) pro forma to reflect transactions occurring
after  September 30, 1996 but before the date of this  Prospectus  consisting of
issuance of $500,000 aggregate principal amount of Bridge Debt and (C) pro forma
as  adjusted  to reflect  the  issuance  and sale of shares of Common  Stock and
Public Warrants  offered hereby (based on an assumed offering price of $5.50 per
share and $.10 per Public Warrant) and the initial  application of estimated net
proceeds therefrom.     

<TABLE>
<CAPTION>
                                                                        SEPTEMBER 30, 1996
                                                           --------------------------------------------
                                                                                            PRO FORMA
                                                                                               AS
                                                               ACTUAL        PRO FORMA     ADJUSTED(1)
                                                           -------------- -------------- --------------
<S>                                                        <C>            <C>            <C>
Short-term debt..........................................  $  4,045,258   $  4,645,258   $    295,160
                                                           ============== ============== ==============
Long-term debt...........................................  $    500,000   $    500,000   $    500,000
                                                           -------------- -------------- --------------
Stockholders' equity:
  Preferred stock, $.0001 par value, 5,000,000 shares
    authorized, none issued or outstanding...............           --             --             --
  Common Stock, $.0001 par value, 20,000,000 shares au-
    thorized; 5,315,811 shares issued (actual), 5,315,811
    shares issued (pro forma) and  7,593,055  shares
    issued (pro forma as adjusted).......................           532            532            760
  Additional paid-in capital.............................     6,527,572      6,527,572     17,469,538
  Accumulated deficit....................................   (11,059,145)   (11,059,145)   (11,059,145)
  Treasury stock, 261,497 shares, at cost................       (11,906)       (11,906)       (11,906)
                                                           -------------- -------------- --------------
Total stockholders' equity (deficit).....................    (4,542,947)    (4,542,947)     6,399,247
                                                           -------------- -------------- --------------
Total capitalization.....................................  $ (4,042,947)  $ (4,042,947)  $  6,899,247
                                                           ============== ============== ==============
</TABLE>
- ----------
   
(1)  Includes  477,244 shares of Common Stock and 477,244 Public Warrants issued
     on the date of this Prospectus upon the conversion of $2,330,300  principal
     amount of Convertible Debt and  approximately  $342,294 of accrued interest
     (based on an assumed  offering price of $5.50 per share and $.10 per Public
     Warrant).  Does not include (i) 1,442,505  shares of Common Stock  reserved
     for  issuance  upon  exercise of  outstanding  warrants to purchase  common
     stock,  (ii)  180,000  shares of Common Stock  reserved  for issuance  upon
     exercise of the Representatives'  Warrants,  (iii) 180,000 shares of Common
     Stock  reserved  for  issuance  upon  exercise of  Representative's  Public
     Warrants issuable upon exercise of Representatives'  Warrants, (iv) 957,975
     shares of Common  Stock  reserved  for  issuance  upon  exercise of options
     available for future grant under the 1995 Option Plan, (v) 1,042,025 shares
     of Common  Stock  reserved for issuance  upon  exercise of options  granted
     under the 1995 Option Plan,  (vi) 906,749  shares of Common Stock  reserved
     for issuance upon  exercise of options  granted under the 1994 Option Plan,
     (vii) 103,549 shares of Common Stock reserved for issuance upon exercise of
     options granted under the 1993 Option Plan,  (viii) 25,000 shares of Common
     Stock reserved for issuance upon exercise of options granted under the 1995
     Directors  Stock Option Plan,  (ix) 225,000 shares of Common Stock reserved
     for issuance upon exercise of options  available for future grant under the
     1995  Directors  Stock  Option  Plan,  (x) 250,000  shares of Common  Stock
     reserved  for  issuance  under  the  Employee  Stock  Purchase  Plan,  (xi)
     1,280,900 shares of Common Stock reserved for issuance upon exercise of the
     Convertible  Debt  Warrants,  and (xii)  1,800,000  shares of Common  Stock
     reserved  for  issuance   upon  exercise  of  the  Public   Warrants.   See
     "Management's Discussion and Analysis of Financial Condition and Results of
     Operations,"   "Management  --  Employee  Stock  Plans,"   "Description  of
     Securities" and "Underwriting."
    

                                       22
<PAGE>
                     SELECTED CONSOLIDATED FINANCIAL DATA

   
   The following selected consolidated financial data have been derived from the
Company's  consolidated  financial statements.  The audited consolidated balance
sheets as of December 31, 1994 and 1995 and the related consolidated  statements
of operations, stockholders' equity (deficit) and cash flows for each of the two
years in the  period  ended  December  31,  1995 and the  notes  thereto  appear
elsewhere in this Prospectus. The selected consolidated financial data set forth
below at September 30, 1996 and for the nine months ended September 30, 1995 and
1996 are derived from unaudited  consolidated  financial statements which appear
elsewhere in this Prospectus and in management's opinion include all adjustments
(consisting  only  of  normal  recurring   adjustments)  necessary  for  a  fair
presentation  of financial  position and results of  operations.  The results of
operations  for the nine months  ended  September  30, 1996 are not  necessarily
indicative  of results  of  operations  to be  expected  for the full year.  The
following data should be read in conjunction  with such  consolidated  financial
statements and "Management's  Discussion and Analysis of Financial Condition and
Results of Operations."     

CONSOLIDATED STATEMENT OF OPERATIONS DATA:

<TABLE>
<CAPTION>
                                                                                                    CUMULATIVE
                                                                                                  FROM INCEPTION
                                                                                                  (NOV. 19, 1992)
                                                                    NINE MONTHS ENDED SEPTEMBER    TO SEPTEMBER
                                        YEAR ENDED DECEMBER 31,                 30,                     30,
                                     ----------------------------- ----------------------------- ----------------
                                          1994           1995           1995           1996            1996
                                     -------------- -------------- -------------- -------------- ----------------
<S>                                  <C>            <C>            <C>            <C>            <C>
Net sales..........................  $   127,531    $   285,354    $   244,223    $   900,446    $  1,377,407
Cost of goods sold.................       64,363        136,381        112,452        315,437         547,994
                                     -------------- -------------- -------------- -------------- ----------------
Gross profit.......................       63,168        148,973        131,771        585,009         829,413
Operating expenses:
 Selling, general and
  administrative...................    1,795,485      2,297,497      1,737,201      1,712,494       6,320,012
 Research and development..........      864,847      1,983,310      1,149,333      1,457,001       4,427,001
 Depreciation and amortization.....       80,360        439,752        185,789        153,035         704,122
                                     -------------- -------------- -------------- -------------- ----------------
  Total operating expenses.........    2,740,692      4,720,559      3,072,323      3,322,530      11,451,185
                                     -------------- -------------- -------------- -------------- ----------------
Other expense (principally
 interest).........................      (39,897)      (843,292)      (568,958)      (343,561)     (1,239,739)
                                     -------------- -------------- -------------- -------------- ----------------
Net loss(1)........................  $(2,717,421)   $(5,414,878)   $(3,509,510)   $(3,081,082)   $(11,861,511)
                                     ============== ============== ============== ============== ================
Net loss per share.................  $     (0.53)   $     (0.98)   $     (0.64)   $     (0.49)
                                     ============== ============== ============== ============== 
Common and common equivalent
 shares outstanding................    5,157,932      5,542,184      5,480,438      6,283,167
</TABLE>

CONSOLIDATED BALANCE SHEET DATA:

<TABLE>
<CAPTION>
                                      DECEMBER 31,
                                -------------------------
                                     1994        1995        SEPTEMBER 30, 1996
                                     ----        ----        -------------------
<S>                             <C>           <C>            <C>
Working capital (deficit) ....  $  (209,143)  $(3,891,602)   $(4,680,592)
Total assets..................    1,781,055     1,244,766      1,560,096
Total liabilities.............    3,180,807     4,497,330      6,103,043
Stockholders' equity
(deficit).....................   (1,399,752)   (3,252,564)    (4,542,947)
</TABLE>
- ----------

(1)  From  Viewpoint's  inception  through its acquisition by the Company on May
     11, 1994,  Viewpoint  elected to be treated as an S Corporation for federal
     income  tax  purposes  and,  accordingly,  its  taxable  income or loss was
     included in the income tax returns of its shareholders.  Viewpoint's status
     as an S Corporation was terminated on May 11, 1994.

                                       23

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

GENERAL

   MultiMedia  Access  Corporation,  a development  stage company,  develops and
markets   advanced  video   communications   products.   The  Company   delivers
high-performance,  low-cost  products that  integrate  video  capabilities  into
existing  desktop  computers,  applications  and networks.  The Company delivers
standards-based video solutions to the PC and workstation marketplace. See "Risk
Factors -- Possible Fluctuations in Operating Results."

RESULTS OF OPERATIONS

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

   Net Sales.  Net sales for the nine months ended  September 30, 1996 increased
to $900,446 from $244,223  reported for the same period last year. This increase
is the  result  of an  increase  in system  and  product  sales for the  period,
particularly  the   Osprey-1000(Trademark)  and  the  Viewpoint  VBX(Trademark),
neither of which were available during the first half of 1995 and  approximately
$80,000 of consulting and custom  programming  revenues during the third quarter
of 1996. A substantial portion of the Company's sales are made to a small number
of customers,  generally on an open account  basis with no collateral  required.
The Company performs  ongoing credit  evaluations of its customers and maintains
reserves of  potential  credit  losses.  Such losses in the  aggregate  have not
exceeded management's expectations.

   Cost of Goods Sold. Cost of goods sold increased $202,985 to $315,437 for the
nine months ended  September 30, 1996, an increase that  primarily is the result
of increased  product and system  sales.  The Company  realized an overall gross
margin  percentage for the first nine months of 1996 of 65.0% which represents a
substantial  increase from the 54.0% experienced during the first nine months of
1995.  This  increase can be attributed  to  consulting  and custom  programming
revenues in 1996 that were  substantially  greater  than the same period in 1995
and which have little or no associated cost of goods sold.

   Selling,   General  and   Administrative   Expense.   Selling,   general  and
administrative  ("SG&A")  expense  of  $1,712,494  for  the  nine  months  ended
September 30, 1996 was essentially unchanged from the same period in 1995.

   Research and Development Expense. Research and Development expenses increased
$307,668 to  $1,457,001  for the nine months ended  September  30, 1996 over the
same period in 1995, primarily due to an increase in salary expense, third party
consulting services,  facility costs of the Company's North Carolina development
office  and an  increase  in salary  expense  of its  Viewpoint  subsidiary.  In
general,  the  increase  reflects the expanded  development  effort  required to
expand the Company's product lines. See "Business -- Research and Development."

   Other Income  (Expense)  During the first nine months of 1996,  other expense
decreased  approximately  $225,397  to  $343,561  compared to the same period in
1995.  This  decrease is  primarily  the result of decreased  interest  expense,
reflecting an overall decrease in average borrowings at a slightly lower blended
interest rate. See "Certain Transactions."     

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

   Net  Sales.  Net sales  increased  $157,823  in 1995  over the prior  year to
$285,354  for the year ended  December  31,  1995.  This  increase is  primarily
attributed to increased unit sales of the Company's Viewpoint VBX(Trademark) and
Osprey-1000(Trademark) products.

   Cost of Goods Sold. Cost of goods sold increased  $72,018 to $136,381 for the
year ended December 31, 1995, an increase that  primarily  reflects the increase
in sales.  Over the same periods,  the Company's gross profit margin  percentage
increased from 49.5% for 1994 to 52.2% for 1995.  This increase is the result of
sales  of  higher  margined  product  and a  slight  increase  in the  sales  of
consulting and custom programming services.

                                       24


<PAGE>
   Selling,   General  and   Administrative   Expense.   Selling,   general  and
administrative  expense  increased  $502,012  to  $2,297,497  for the year ended
December 31, 1995.  This 28.0% increase over the prior year can be attributed to
increases in employees and  consultants,  higher  occupancy  costs and increased
business development,  sales and marketing related expenses corresponding to the
introduction  of  the  Viewpoint-PRO(Trademark),  Viewpoint  VBX(Trademark)  and
Osprey-1000(Trademark) product lines in 1995.

   Research and  Development  Expense.  The Company's  research and  development
expense  increased  $1,118,463  to  $1,983,310  in  1995  primarily  due  to the
establishment  of the Company's  North  Carolina  development  office.  Expenses
related to this office  included  salaries for newly hired engineers and support
staff and the cost of the office  facility  and  equipment.  During  1995,  this
development  office was engaged in the development of the  SLIC-Video(Trademark)
and  Osprey-1000(Trademark)  products  which were  introduced  in  mid-1995  and
late-1995, respectively.

     Other Income (Expense). For the year ended December 31, 1995, other expense
increased  to  $843,292  for the year  compared  to  $39,897  for the year ended
December 31, 1994.  This  increase was  primarily  the result of an  approximate
$766,402  increase  in  interest  expense  for 1995  over  1994,  as a result of
additional  borrowings  pursuant to the Convertible Debt and borrowings pursuant
to the Secured Notes and Demand Notes. See "Certain Transactions."

LIQUIDITY

   
   At  September  30,  1996,  the  Company  had a  working  capital  deficit  of
$(4,680,592).  To date,  the  Company  has been  dependent  upon  loans from its
principal  stockholders,  as well as private  placements  of its debt and equity
securities, to finance its working capital requirements.

   Net cash used in operating activities for the nine months ended September 30,
1996 was  $2,863,323.  Increases  in  inventory  were a result of an increase in
production levels to meet anticipated sales.

   Cash used in investing  activities  for the nine months ended  September  30,
1996  consisted  of  $122,080  of capital  expenditures.  As of the date of this
Prospectus,  the  Company  does not have any  material  commitments  for capital
expenditures.

   Cash provided by financing activities for the nine months ended September 30,
1996 was  primarily a result of the receipt of the proceeds of the Secured Notes
II in January through February 1996,  receipt of the proceeds of the Bridge Debt
in  September  1996 and the private  placement of Common Stock during the second
quarter of 1996. At September 30, 1996, the Company had cash of $21,523.     

   The Company currently has no plans or agreements to seek loan financing.  The
Company may choose to seek additional  financing to provide  additional  working
capital at some time in the future. Such financing may include loans or lines of
credit and could include  factoring  agreements.  However,  the Company believes
that the proceeds of the initial public  offering will be sufficient to meet its
capital requirements for at least the next twelve months.

   
   The Company's  independent auditors have included an explanatory paragraph in
their audit report on the Company's  consolidated  financial  statements stating
that certain  factors raise  substantial  doubt about the  Company's  ability to
continue as a going concern.  This offering is an integral part of the Company's
plan to  continue  as a going  concern.  In the event that the  Company's  plans
change or its assumptions change or prove to be inaccurate or if the proceeds of
this offering prove to be insufficient to fund operations (due to  unanticipated
expenses  or  difficulties  or  otherwise),  the Company may be required to seek
additional  financing  sooner  than  currently  anticipated.  The Company has no
current arrangements with respect to, or sources of, additional financing. There
can be no assurance that existing  stockholders  will provide any portion of the
Company's  future  financing  requirements.  There can be no assurance  that any
additional financing will be available to the Company on acceptable terms, or at
all.  Additional  equity  financing  may  involve  substantial  dilution  to the
Company's then existing stockholders.     

                                       25

<PAGE>
   From  Viewpoint's  inception in November 1992 through  December 31, 1993, the
operations of the Company were  principally  limited to conducting  research and
development,  limited production operations and marketing of prototype products.
From  Viewpoint's  inception  through its  acquisition by the Company on May 11,
1994, Viewpoint elected to be treated as an S Corporation for federal income tax
purposes and, accordingly, its taxable income or loss was included in the income
tax returns of its  shareholders.  Viewpoint's  status as an S  Corporation  was
terminated on May 11, 1994.

   At December 31, 1995,  the Company had net operating  loss carry forwards for
federal tax purposes of $7,730,000  available to offset future  taxable  income.
Under Section 382 of the Internal Revenue Code of 1986, as amended,  utilization
of prior net operating loss carry forwards is limited after an ownership change,
as defined in Section  382, to an annual  amount  equal to the value of the loss
corporation's  outstanding  stock  immediately  before the date of the ownership
change multiplied by the federal long-term tax-exempt rate. Beginning with 1994,
approximately  $790,000 of the carry forward is limited to utilization at a rate
of approximately  $300,000 per year. The Company may in the future be subject to
further  significant  limitations  on the use of its net  operating  loss  carry
forwards.  In  the  event  the  Company  achieves  profitable  operations,   any
significant  limitation on the  utilization of net operating loss carry forwards
would have the effect of increasing the Company's tax liability and reducing net
income and available cash resources.  Moreover,  Viewpoint terminated its status
as an S Corporation in May 1994, and net operating  losses incurred by Viewpoint
prior to such  termination will not be available to offset future taxable income
of the Company. See Note 8 of Notes to Consolidated Financial Statements.

CAPITAL RESOURCES

   In  January  1993,  Viewpoint  issued to five  individuals  an  aggregate  of
$200,000  principal  amount of 5% convertible  promissory notes ("Notes") due in
January 1994. In connection with the issuance of these notes,  Viewpoint  issued
warrants  to  purchase  an  aggregate  of 51,100  shares  of Common  Stock at an
exercise price of approximately  $.02 per share. In June 1993,  Viewpoint issued
to  one  individual  an  additional  $25,000  principal  amount  5%  convertible
promissory  note due June 1994 and  warrants to purchase  6,388 shares of Common
Stock at an exercise price of approximately $.50 per share.

   In January 1994,  holders of $100,000 principal amount of the Notes agreed to
exchange such notes (plus accrued interest of approximately $4,891) for $104,891
aggregate  principal amount of 5% convertible  promissory notes due January 1995
and  warrants to purchase an  aggregate  of 25,550  shares of Common Stock at an
exercise price of approximately $.50 per share. In April 1994,  Viewpoint repaid
the remaining $100,000  principal amount of the 5% convertible  promissory notes
issued in January 1993, together with accrued interest thereon.

     During 1993, Glenn A. Norem, Chief Executive Officer of the Company, loaned
Viewpoint an aggregate of $90,700 at an annual  interest rate of 8%. These loans
were repaid by the Company in November  1994.  In  connection  with these loans,
Viewpoint issued warrants to Mr. Norem to purchase an aggregate of 11,587 shares
of Common Stock at an exercise price of approximately $0.20 per share. Mr. Norem
exercised  these warrants in May 1994. In addition,  during 1993,  G.A. Norem I,
L.P.,  of which Mr.  Norem is the sole  general  partner,  loaned  Viewpoint  an
aggregate of $35,500 at an annual  interest rate of 8%.  Viewpoint  repaid these
loans in June 1994. In connection with these loans, Viewpoint granted G.A. Norem
I, L.P. a  security  interest  in all of its assets and issued to G.A.  Norem I,
L.P.  warrants to purchase  4,536 shares of Common Stock at an exercise price of
$.10 per share. G.A. Norem I, L.P. exercised these warrants in May 1994.

   
   In March 1994,  the Company  issued an aggregate of 996,364  shares of Common
Stock at a price of $2.20 per  share,  for which it  received  net  proceeds  of
$1,917,241.     

   In September 1994 through January 1995, the Company issued  promissory  notes
(the  "Convertible  Debt") in the aggregate  principal amount of $2,677,550 (the
"Convertible Debt  Financing").  The Convertible Debt bears interest at the rate
of 8% per annum and is, at the option of the  holder,  (i) due on the earlier of
the closing of an initial public offering of the Company's equity  securities in
excess of $2,000,000 or 18 months from the date of issuance or (ii)  convertible
into shares of the  securities  sold in an initial  public  offering  registered
under the Securities Act of 1933, as amended, (the "Securities Act").

                                       26
<PAGE>
In addition, pursuant to the terms of the Convertible Debt Financing,  investors
electing to convert their Convertible Debt into shares of the securities offered
in an initial public offering will receive one Convertible Debt Warrant for each
$2.00  principal  amount of  Convertible  Debt that is converted  and  investors
electing  repayment of the Convertible  Debt will receive one  Convertible  Debt
Warrant for each $3.00  principal  amount of Convertible  Debt  surrendered  for
repayment. The Convertible Debt Warrants are exercisable at an exercise price of
$3.00 per share during a three-year period commencing on the date of the closing
of  such  initial  public  offering.  The  Company  used  the  proceeds  of  the
Convertible Debt Financing for working capital and general  corporate  purposes.
Holders of  $2,330,300  principal  amount of  Convertible  Debt have  elected to
convert into the  securities  offered  hereby and holders of $347,250  principal
amount have elected to be repaid from the proceeds of this offering.

   In October 1994,  the holder of the $25,000  principal  amount note issued in
June 1993 agreed to exchange such note (plus accrued  interest of  approximately
$1,654) and an additional  $346 in cash (a total of $27,000) in the  Convertible
Debt Financing. In January 1995, the holders of the remaining $104,891 principal
amount of 5%  convertible  promissory  notes  issued in January  1994  agreed to
exchange  such notes  (plus  accrued  interest of  approximately  $5,359) in the
Convertible Debt Financing.

   From February  through April 1995,  the Company  received  gross  proceeds of
$1,100,000  in  connection  with the issuance and sale of  $1,100,000  aggregate
principal amount of short-term secured notes (the "Secured Notes").  The Secured
Notes bear  interest at the rate of 15% per annum and were due at the earlier of
the  closing  of an  initial  public  offering  by the  Company  or 90 days from
issuance.  As of December 31,  1995,  Secured  Notes  totalling  $791,000,  plus
accrued interest,  were exchanged for equity in the company by issuing one share
of Common Stock for each $3.00 of debt.  In addition,  pursuant to the exchange,
each consenting  holder received a warrant to purchase one share of Common Stock
for each $2.00  exchanged.  The warrants are  exercisable at $1.00 per share for
three years.  Also at December 31, 1995,  the  remaining  holders of the Secured
Notes  agreed to exchange  their notes for Demand  Notes.  In return,  each such
holder  received a warrant to purchase  one share of Common Stock for each $3.33
exchanged to Demand Notes.  The warrants are  exercisable at $1.00 per share for
three years.  The Secured  Notes are secured by a lien on all then  unencumbered
assets of the Company.  The Company  used the proceeds of the Secured  Notes for
working capital and general corporate purposes.

   
   At the time of the Secured Notes  transactions,  the Company's funds had been
depleted, only limited product sales had occurred and the Company twice had been
forced to abandon  its plans for an initial  public  offering  and other  equity
financing.  Once these  funding  avenues  were  abandoned,  the Company was left
without  sufficient  cash  to  pay  its  payroll  or  continue  its  development
activities.  In consideration of these factors,  it was estimated by third-party
appraisal that the stock was worth no more than $.50 per share.     

   In June and July 1995,  the Company  received  gross  proceeds of $310,000 in
connection with the issuance and sale of $310,000 aggregate  principal amount of
short-term demand notes (the "Demand Notes").  The Demand Notes bear interest at
the rate of 15% per annum. Pursuant to the terms of the Demand Notes,  investors
received one warrant to purchase a share of Company  Common Stock for each $4.00
of principal.  The warrants are  exercisable  at an exercise  price of $1.00 per
share for three years from the date of issuance. As of December 31, 1995, Demand
Notes totalling  $250,000,  plus accrued interest,  were exchanged for equity in
the  Company  by  issuing  one  share of Common  Stock  for each  $3.00 of debt.
Pursuant to this exchange, each exchanging holder received a warrant to purchase
one  share of  Common  Stock  for  each  $2.00  exchanged.  These  warrants  are
exercisable  at $1.00 per share for three years.  Also at December 31, 1995, the
remaining holders of the Demand Notes received an additional warrant to purchase
one share of Common Stock for each $3.33 invested as additional compensation for
extension of demand notes. These warrants are exercisable at $1.00 per share for
three  years.  The Company  used the  proceeds  of the Demand  Notes for working
capital and general corporate purposes.

   In August and  September  1995,  the Company  issued an  aggregate of 833,333
shares of  Common  Stock at a price of $3.00 per  share,  for which it  received
gross proceeds of $2,500,000.

   In January and February 1996, the Company received gross proceeds of $650,000
in connection with the issuance and sale of $650,000 aggregate  principal amount
of a second series of short-term  secured  notes (the "Secured  Notes II").  The
Secured Notes II bear interest at a rate of 8-10% per annum and were due 180

                                       27

<PAGE>
days from issuance.  Pursuant to the terms of the Secured Notes II, the investor
was granted warrants to purchase 65,000 shares of Common Stock of the Company at
$3.00 per share for three (3) years from the date of  issuance.  As of March 31,
1996, the Secured Notes II, plus accrued interest, were converted into equity in
the Company by issuing one share of Common Stock for each $3.00 of debt.

   In April through June 1996, the Company issued an aggregate of 304,016 shares
of Common  Stock at a price of $3.00 per  share,  for  which it  received  gross
proceeds of $912,054.

   In July 1996, the Company received gross proceeds of $1,000,000 in connection
with the  issuance  and  sale of  $1,000,000  aggregate  principal  amount  of a
convertible  note (the  "Convertible  Debt II"). The  Convertible  Debt II bears
interest at the rate of 8% per annum and $500,000 is due the earlier of ten days
after the  completion of an initial  public  offering by the Company or 180 days
from  issuance,  while the  balance of  $500,000  is due  eighteen  months  from
issuance.  Pursuant  to the  terms  of the  Convertible  Debt II,  the  investor
received a warrant to purchase  100,000  shares of Common  Stock of the Company.
The  warrant is  exercisable  at a price of $3.00 per share for three years from
the date of issuance.  In addition,  should the investor  elect to convert,  the
investor will receive an additional warrant to purchase 100,000 shares of Common
Stock at $3.00 per share for three years from the date of conversion.

   
   In  September  and October  1996,  the  Company  received  gross  proceeds of
$550,000  in  connection  with  the  issuance  and  sale of  $550,000  aggregate
principal  amount of a bridge loan (the "Bridge  Debt") to Mr. Robert  Rubin,  a
shareholder of the Company. The Bridge Debt bears interest at the rate of 8% per
annum and is due the  earlier  of ten days  after the  completion  of an initial
public  offering by the Company or 180 days from issuance.  Mr. Rubin received a
warrant to purchase 55,000 shares of Common Stock of the Company  exercisable at
a price of $3.00 per share for three years from the date of issuance pursuant to
the terms of the Bridge Debt.

   In October  1996,  Glenn A. Norem,  Chief  Executive  Officer of the Company,
agreed to defer the receipt of $164,154  principal  amount of Secured and Demand
Notes,  accrued  interest of $41,154 and accrued  salary and bonuses of $127,781
until  December 1997. The Company has agreed to pay Mr. Norem interest at a rate
of 15% per annum on the deferred amount.  In addition,  Mr. Norem will be repaid
$200,000  principal  amount of Secured and Demand  Notes and  $50,000  principal
amount of Convertible  Debt plus accrued interest of $7,419 from the proceeds of
this offering.

   In  November  1996,  the  Company  received  gross  proceeds  of  $300,000 in
connection with the issuance and sale of $300,000 aggregate  principal amount of
additional  Bridge Debt to Mr. M.  Douglas  Adkins and Mr. H.T.  Ardinger,  each
shareholders  of the Company.  This Bridge Debt bears interest at the rate of 8%
per annum and is due the earlier of ten days after the  completion of an initial
public  offering by the Company or 180 days from  issuance.  The holders of this
Bridge Debt received  warrants to purchase  30,000 shares of Common Stock of the
Company  exercisable at a price of $3.00 per share for three years from the date
of issuance pursuant to the terms of the Bridge Debt.     

   The Company  believes  that the net proceeds of this  offering  together with
available cash will be sufficient to meet the Company's  operating  expenses and
capital requirements for at least the next twelve months.

                                       28


<PAGE>
                                   BUSINESS

   MultiMedia   Access   Corporation   develops  and  markets   advanced   video
communications  products for the PC and workstation  marketplaces.  Applications
include desktop  videoconferencing,  Internet and Intranet video communications,
video-based  training,  video  surveillance,  distance learning and high quality
workgroup video communications. While the Company sells its core video Codec and
video switching  technologies to resellers and systems integrators,  its primary
strategy is to develop and market video  communications  applications  using its
technologies.

   The  Company,  in September  1996,  entered  into a reseller  agreement  with
Unisys, a nationwide systems integrator and reseller, to purchase and resell the
Company's Viewpoint  VBX(Trademark).  The Viewpoint VBX(Trademark) is a PC-based
video  switch  which  provides  workgroup  video  communications  over  existing
telephone or network wiring commonly found throughout office  buildings.  Unlike
commercially  available  competitive  products,  the  Viewpoint   VBX(Trademark)
connects  over  100  users  per  switch  and  distributes  full-motion  video at
distances up to 3,500 feet via existing UTP wiring.

   The Company  entered into a licensing  agreement with Boca, a major modem and
PC   peripheral   supplier,    to   manufacture   and   market   the   Company's
FamilyFone(Trademark)  and its ISDN  videoconferencing  upgrades in January 1996
and  delivered  its  first  video  surveillance   system  to  Alcatel,  a  major
communications  systems  integration  company, in the first quarter of 1996. The
Company  believes  it  sells  the  only  currently  available   standards-based,
multi-algorithm  video and audio Codec product for WindowsNT and is developing a
multi-algorithm Codec for Sun workstations.

INDUSTRY BACKGROUND

   Videoconferencing  was introduced in the late 1970s with the establishment of
videoconferencing  room  systems.  To transmit  "live" video  images  (which may
contain over 90 million bits per second of data) over telecommunications  lines,
the  video  data  must be  digitized  and  significantly  compressed  to fit the
capacity  of data  networks  and  telephone  lines  (as low as  28,800  bits per
second).  As video  data is  compressed,  redundant  data is  eliminated.  After
transmission, the video image is reconstructed for display at the receiving end.

   The   quality  of  the   reconstructed   image  is  a  function  of  (1)  the
sophistication of the video and audio compression algorithms,  (2) the amount of
real-time  data which can be  transmitted  over  networks,  (3) the power of the
video and audio coder-decoder  hardware,  and (4) the speed and power of PCs and
workstations.

   The Company  believes  low-cost  videoconferencing  and other  video  network
services are now attainable  because the performance  and  capabilities of these
four  key  elements  have   recently   improved   significantly,   making  video
communications available at reasonable cost.

   Videoconferencing  room  systems  use  expensive  digital  lines  and  permit
communication only between compatible  facilities.  These systems currently cost
between  $20,000  and  $100,000  and are  typically  used by large  corporations
primarily for  intra-company  communication  between  different  locations.  The
Company  believes that the high cost of  videoconferencing  room systems and the
logistical  problem of  scheduling  and  availability  have limited their use to
large corporations.

   According to industry sources, the video communications  industry is forecast
to be $3.6 billion by 1999 and the emerging  desktop segment of that industry is
forecast to exceed $1.2 billion by 1999. The PC dominates the desktop  computing
market with 1995 sales of over 57 million  units  worldwide and an estimated 100
million new PCs projected to be sold annually by 1999. Industry sources estimate
that over 30% of the new PCs sold in 1996 (principally  multimedia  capable PCs)
will be purchased by consumers for use in the home. The Company  believes it has
developed products which position it to benefit from the growth of these markets
and which will have functions,  performance and cost to successfully  compete in
the rapidly emerging desktop video communications industry.

     The Company  currently  offers a variety of products with  differing  video
quality levels: NTSC TV quality with the Viewpoint  VBX(Trademark) video switch,
business quality with the  Osprey-1000(Trademark)  using ISDN lines and consumer
quality video with  FamilyFone(Trademark)  using modems over ordinary  telephone
lines. The

                                       29


<PAGE>
resolution  and  framerate  of  the  video  varies  with  the  bandwith  of  the
communications  connection. The Company has designed its products in response to
the increasing demand for low-cost desktop  videoconferencing  and for real-time
collaborative  computing applications using telephone and computer networks. The
Company  is also  preparing  to  market  video  products  for the  Internet  and
corporate Intranets.

CORPORATE INTRANET VIDEO

   The  Company  first  demonstrated  its packet  (TCP/IP-based)  network  video
technologies  on the  Internet's  MBONE and on corporate  Intranets in 1993. The
Company introduced its first commercial product,  Viewpoint-PRO(Trademark),  one
of the first TCP/IP-based  videoconferencing  systems designed  specifically for
LAN and WAN  applications  in 1994.  This  system  enables  users to  engage  in
real-time, full-color,  full-motion video over their existing computer networks.
Viewpoint-PRO(Trademark)  provides  both  point-to-point  and  up to  five  site
multipoint  videoconferences.  The system does not require expensive MCUs, which
typically cost $20,000 or more, that ISDN-based  products  require to complete a
multipoint   video-   conference.   Viewpoint-PRO(Trademark)   also  includes  a
one-to-many   broadcasting   capability   called    ViewCast(Trademark).    With
ViewCast(Trademark),  "live"  broadcasts,  such as  corporate  briefings or news
broadcasts,  or  pre-recorded  content,  such as training videos and product and
services information,  can be multicast over an existing corporate data network.
Viewpoint-PRO(Trademark)   was  the  first  commercial  product  offering  video
multicast   using  both  FTP  Software,   Inc.'s  and  Microsoft   Corporation's
TCP/IP-multicast PC software. Each Viewpoint-PRO(Trademark) includes software to
enable  a   Windows   PC  with  a  sound   card  to   receive   and   display  a
ViewCast(Trademark). Viewpoint-PRO(Trademark) bundles, as an option, third-party
collaborative  computing software which allows  videoconference  participants to
share a whiteboard or a PC application.

CONSUMER VIDEO

   The  Company's  FamilyFone(Trademark)  and  WorkFone(Trademark)  products are
expected to provide affordable,  good quality video communications  capabilities
to consumers,  small businesses and corporations  over standard  telephone lines
with 28.8 Kbps modems and over the Internet.  Examples of  FamilyFone(Trademark)
uses might include:  families and grandparents  exchanging "live" video birthday
greetings with each other, college students videoconferencing with their parents
or small  office/home  office business owners  accessing video training  courses
over the Internet.

   In January 1996, the Company signed a licensing  agreement with Boca. In this
multi-year contract,  the Company licensed its hardware and related firmware and
application  software for  videoconferencing  over standard  telephone lines and
over the Internet.  Pursuant to the licensing  agreement,  the Company  receives
license  fees for the design and  on-going  royalties  for its  firmware and its
videoconferencing  applications  with every  shipment of the BocaPRO Video Phone
Elite,  which was introduced by Boca in August 1996 at a suggested  retail price
of $399.  The  Company's  prospects  will be  significantly  affected  by Boca's
ability  to  market  the  product  and  upon the  marketing  efforts  of  Boca's
resellers.

VIDEO CODECS

   The  Company  develops  and  markets  standards-based  video and audio  Codec
products that enable multimedia applications for both PCs and workstations.  The
Osprey Codec captures, digitizes, compresses,  transmits, receives, decompresses
and displays full-motion video. The Osprey-1000(Trademark) product line supports
multiple video and audio compression formats for both PCs and workstations which
are  equipped  with the now  standard  PCI-bus.  The Company is  developing  the
Osprey-1100(Trademark)  multi-algorithm Codec for the existing workstations from
Sun that are  equipped  with the  S-bus.  The  Company  believes  it is the only
company currently providing standards-based,  multi-algorithm Codec products for
WindowsNT.  The Osprey Codecs also support Windows 3.1,  Windows95,  Solaris and
UNIX operating systems.

   SLIC-Video(Trademark) is a video capture product that enables Sun workstation
users to view uncompressed,  high-quality video and to capture full-motion video
frames.  SLIC-Video(Trademark)  software also provides  access to closed caption
data  which  allows  key  words to act as  filters  and  thereby  control  video
displayed on the screen. SLIC-Video's(Trademark) compatibility with standard Sun
products allows this product to support a wide variety of video  applications on
existing Sun workstations.

                                       30

<PAGE>
   The Company intends to continue to establish  strategic  product  development
alliances  with  companies  whose  products  and  technologies   complement  the
Company's strategic direction.  With rapidly evolving  technologies in the areas
of  video,  audio and  networks,  the  Company  intends  to engage in  strategic
alliances that offer expanding access to key new  technologies  that can be part
of current and future products.

VIDEO SWITCHING HUB AND UTP VIDEO DISTRIBUTION

   The  Company's  Viewpoint   VBX(Trademark)   product  provides   high-quality
workgroup  video  communications  with shared  gateways to WANs and legacy video
teleconferencing  room systems. The Viewpoint  VBX(Trademark),  a PC-based video
switch, employs a switched architecture to distribute uncompressed,  full-motion
video  within a building or campus via  existing  UTP  wiring.  Shared wide area
gateways allow other Viewpoint  VBX(Trademark) networks to be interconnected and
enable connection to standards-based room or desktop videoconferencing  products
from third-party manufacturers. The switching architecture employed by Viewpoint
VBX(Trademark)  allows   point-to-point,   multipoint  and  broadcast  modes  of
operation to be supported.  Both small  workgroups  and large building or campus
networks of hundreds of users can be supported.

   The Viewpoint  VBX(Trademark)  product line includes a multimedia switch, WAN
interfaces and desktop  components.  The multimedia  switch utilizes standard PC
components and the Company's video switching  technology and software to provide
an expandable  solution for video  communications  within an office  building or
campus.  Video and audio are  distributed  with NTSC  quality by  utilizing  the
Company's  UTP  transceiver  technology  to send video over  existing  wiring at
distances of up to 3,500 feet. An existing LAN or telephone  system is used only
for non-video communications (control signals) between the multimedia switch and
each user,  eliminating  overload  of the  computer  network as  workgroups  are
video-enabled.

   The Viewpoint  VBX(Trademark) also provides  shared-resource  access to video
sources and storage devices located anywhere within the network. VCRs, videodisk
players,  broadcast or cable TV and Direct Broadcast Satellite (DBS) programming
sources may be connected to the switch over  unshielded  twisted pair or coaxial
cabling and distributed on-demand to any equipped desktop or room.

   Desktop  PCs, TV monitors  and room audio and video  system  connections  are
accommodated  using the UTP  transceivers  which connect standard NTSC video and
audio devices to existing building wiring systems.  Viewpoint  VBX(Trademark) is
compatible with standard NTSC cameras,  audio  components,  speakerphones and PC
video  peripherals  to form a complete  solution.  The Viewpoint  VBX(Trademark)
client  software  allows users to place calls through a personal or  system-wide
dialing  directory,  to originate and subscribe to "live" video  broadcasts,  to
access pre-recorded video content or to establish a multipoint videoconference.

INTERNET VIDEO

   The Company is  developing  and plans to market a variety of  Internet  video
products  that take  advantage of the growing  popularity of the World Wide Web.
The popularity of the Web has resulted in  subscribers  seeking to improve their
Internet  access  capabilities  which in turn has driven growth in the installed
base of 28.8 Kbps modems, ISDN adapters and cable modems.  These improvements in
access  along  with  advances  in video and  audio  compression  technology  and
standards  make  possible  new  forms  of  motion-video   content  for  Internet
publishers and their target audiences.

   The Internet has taken on new dimensions  including  real-time  communication
and  entertainment.  In both cases,  the Company  believes  video  communication
products and  technologies  will play an important role.  While certain types of
information on an Internet Web page can be conveyed with graphics, animation and
static images, others require or are enhanced by audio and motion-video.

   The Company is  currently  developing  and plans to market three new Internet
video  products and software  players  (downloaded  freely to  end-users).  Each
product is an enhancement of or modification to existing  Company  designs,  but
incorporates  new software  and firmware  modules.  These  products  address the
rapid-growth,  emerging market  opportunity  for the Internet video  publishing,
Internet video  broadcasting and Internet video call center  applications  which
are described below.

                                       31


<PAGE>
 INTERNET VIDEO PUBLISHING

   Internet  video  publishing  (or   video-on-demand)  is  currently  the  most
widespread  implementation of video on the Internet.  Video publishing refers to
stored-video  content,  designed  to  be  played  back  to a  user's  system  in
real-time.  The Company believes video publishing is becoming popular because it
is far less technically demanding than "live" video production and transmission.

   Internet video publishing  entails  compressing a video "clip" and storing it
on a server.  The user is  connected  to the server by accessing a Web page that
holds the address for the target  video  server and then  establishing  a direct
connection  to that  server.  The  Company's  video Codec  technologies  will be
utilized  with  Internet  publishing  software   applications   currently  under
development by the Company.

 INTERNET VIDEO BROADCASTING

   Video  broadcasting has recently come to the Internet and is characterized by
one-way "live" audio and motion-video.  Video  broadcasting  presents  technical
challenges such as the limited bandwidth and multi-cast capabilities of most Web
sites.  However,  Internet video broadcasting is well suited to delivering video
to the office (without additional  hardware),  to distance learning sites and to
special interest broadcast recipients. The Company's proposed products are being
designed  to  work  in  conjunction   with  Web  server  software  to  establish
connections between multiple users and a broadcast source.

 INTERNET VIDEO CALL CENTER

   The  Internet  video call center is a new concept to the  Internet,  allowing
one-way  "live"  video and two-way  audio  across the  Internet.  The term "call
center" is used because the technology is well suited to replacing existing call
centers  such as help  desks,  catalog  ordering  centers,  reservation  systems
(hotels,  airlines) and corporate  receptionists.  The Company believes that the
entertainment possibilities are also significant. The Internet video call center
has the potential to increase on-line  purchases over the Internet.  The Company
believes its core technologies can be used in video call center applications and
is in the early stages of product development.

VIDEO SURVEILLANCE

   The Company believes that commercial and residential video-based surveillance
products represent another strong business opportunity.  The Company is creating
effective  solutions for customers  that are unique in the  marketplace.  In the
Company's opinion,  today's expensive closed circuit surveillance systems can be
replaced with systems that include more functionality at lower cost. The Company
intends to develop alliances with communication  system integrators and security
resellers, distributors and/or suppliers to address this market.

   The Company has delivered its first video  surveillance  system to Alcatel, a
major  communications  systems  integration  company in Richardson,  Texas. This
industrial  surveillance  system  integrates  standard alarm and sensing devices
(e.g.  door magnets,  motion  detectors,  cameras,  etc.),  and allows a central
operator  to monitor and inspect  hundreds of remote  sites over the  customer's
existing frame relay computer network.

   Following an alarm,  the surveillance  system selects the appropriate  camera
and one of its preset  positions and captures 10 frames of full  resolution NTSC
video.  The system also sends an alarm signal to a central  monitoring  computer
via a  frame  relay  packet  network.  The  security  personnel  at the  central
monitoring  station  can then  observe  the  remote  alarmed  location,  via the
network,  using the camera's  remote pan,  tilt and zoom  features.  The Company
believes  that high  quality  video  images will assist  security  personnel  in
verifying the accuracy of alarms and in prosecuting intruders.

   The  surveillance   system  delivered  to  Alcatel  is  based  upon  existing
Viewpoint-PRO(Trademark)  technology.  Another version of the system designed to
operate over phone lines is scheduled to be available in early 1997.

                                       32


<PAGE>
MARKETING AND SALES

   The Company  will market its products  primarily  via  third-party  resellers
including,  but not limited to, OEMs, VARs and system integrators.  In addition,
the  Company   plans  to  enter  into   strategic   alliances   with   carriers,
telecommunications suppliers and information providers.

   For mass market and high volume products the Company will depend on its major
OEM customers who provide access to significant  marketing channels.  These OEMs
have established  relationships  with  manufacturers  and resellers and will pay
licensing  fees and royalties to bring new leading edge products to market.  The
Company also intends to establish distribution  relationships with resellers and
integrators who service corporate, institutional and government customers. These
relationships  are  expected  to be  non-exclusive  and may  require  that these
partners participate in the marketing,  advertising and technical support of the
Company's products.

   The Company believes its Viewpoint VBX(Trademark) product will have an appeal
to resellers such as PBX suppliers,  carriers  (including  cable  companies) and
network equipment suppliers.  The Company additionally intends to form strategic
alliances  with  resellers  outside the US, where it is especially  important to
partner with entrenched suppliers.

   The Company intends to expand its marketing activities over the Internet. The
Company  believes its products  enable new and  inventive  ways to sell products
over the Internet. The Company intends to use its own products to increase sales
productivity  and to pursue alternate low cost selling  strategies.  The Company
plans to continue  modest  trade show  participation  and  advertising  in trade
publications.

   The Company's  Internet  related  products will be marketed  primarily to Web
designers and early sales will be conducted  primarily through the Company's Web
page with minimal sales  support.  The Company plans to bundle its products with
other  popular  Web  development  products  and/or  license  its  subsystems  to
resellers to  integrate  with their Web  development  products.  Such  strategic
business  alliances are expected to provide Web developers  with a rich array of
innovative capabilities with the familiarity of existing tools.

TARGET MARKETS

   The  Company's  target  markets can be defined  broadly to be anywhere  video
communications can be added as a peripheral to installed desktop  computers,  or
to  narrower  vertical  markets  in  distance  learning,  video-based  training,
multimedia authoring,  Internet and Intranet broadcasting and surveillance.  The
Company believes that the growth of video  communications  during the late 1990s
will  be as  significant  as the  growth  of LANs in the  1980s.  The  Company's
strategy  is to provide  video  communications  products  which will  connect to
available  networks,  including  standard telephone lines, data networks and the
Internet.  The Company  believes  that its video  communications  products  will
enhance  the  increasing  demand  for  connectivity  between  today's  homes and
offices.

   Strategic   alliances   with  large   OEMs,   communication-oriented   system
integrators and other resellers  should enhance the Company's  ability to supply
video  communication  products  to Fortune  1000  companies,  federal  and state
governments,  PC  manufacturers,   peripheral  suppliers  and  Internet  service
providers.

PRODUCTION AND SUPPLY

   The Company builds its current  products in small  quantities  using contract
manufacturers  in Texas and North Carolina.  The operations  personnel in Dallas
are responsible for parts planning, procurement and final test and inspection to
quality standards.  While the Company believes its products are not difficult to
manufacture,  there  can be no  assurance  that the  Company's  products  can be
manufactured on a wide-scale basis on commercially  reasonable terms, or at all.
The Company plans for most high- volume  production to be handled  through large
OEMs or contract manufacturers.

   The Company has been and will  continue to be dependent on third  parties for
the supply and  manufacture of its components  and electronic  parts,  including
standard and custom-designed components. The Company generally does not maintain
supply agreements with such third parties but instead

                                       33


<PAGE>
purchases  components  and electronic  parts pursuant to purchase  orders in the
ordinary  course of  business.  The Company is  substantially  dependent  on the
ability of its third-party  manufacturers  and suppliers to, among other things,
meet the Company's design, performance and quality specifications.

   The  electronics  industry from time to time  experiences  short  supplies of
certain high demand components, which may adversely affect the Company's ability
to meet its  production  schedules.  Failure of  manufacturers  or  suppliers to
supply, or delays in supplying,  the Company with components,  or allocations in
the  supply  of  certain  high-demand  components  could  adversely  affect  the
Company's  operations  and ability to meet  delivery  schedules  on a timely and
competitive basis.

INSTALLATION, SERVICE AND MAINTENANCE

   Many of the Company's new products will be customer installable.  The Company
plans to contract with independent  third parties to provide field  installation
and support.  The Company also plans to maintain a small technical support group
and will also depend on its resellers to install and service its products.

   The Company offers 12 to 36 month limited warranties covering workmanship and
materials,  during which period the Company or its resellers  will replace parts
or make repairs.  The Company also  maintains an in-house  staff of  engineering
personnel and offers telephone  support to assist resellers and end-users during
normal business hours.

RESEARCH AND DEVELOPMENT

   The Company's  development efforts during 1995 were devoted to the design and
development of the Osprey-1000(Trademark) PCI-based multi-algorithm video Codec,
the   SLIC-Video(Trademark)    video   capture   card,   enhancements   to   the
Viewpoint-PRO(Trademark),  design and  integration  of the  surveillance  system
delivered to Alcatel, and the development of the Viewpoint  VBX(Trademark) video
switching hub.

   
   Total  research  and  development  expense  for 1995 was  approximately  $2.0
million.  The 1996 research and development  plan calls for  approximately  $1.9
million in development  costs. For the nine months ended September 30, 1996, the
Company incurred approximately $1,457,000 in research and development costs.
    

   The Company utilizes its core  technologies to create multiple products aimed
at different markets.  Software  modularity is a major strategy which allows the
Company to develop different vertical  applications using modules and components
previously   developed  for  other   products.   The   Company's   products  are
characterized  by rapidly  changing  technology  and evolving  standards,  often
resulting in product obsolescence or short product life cycles. Accordingly, the
Company's  ability  to  compete  will  depend in large  part on its  ability  to
introduce its products in a timely manner,  to  continually  enhance and improve
its hardware and software products and to maintain  development  capabilities to
adapt  to  technological  changes  and  advances  in  the  video  communications
marketplace.  There  can be no  assurance  that  competitors  will  not  develop
technologies  or products  that render the  Company's  systems  obsolete or less
marketable, or that the Company will be able to keep pace with the technological
demands of the marketplace or successfully  enhance and adapt its products to be
compatible with newly developed products,  technologies and software, or satisfy
industry standards and the needs of its consumers and potential consumers.

COMPETITION

   The market for DVC systems is highly  competitive  and  characterized  by the
frequent introduction of new products based upon rapidly changing  technologies.
The Company competes with numerous well-established  manufacturers and suppliers
of videoconferencing,  networking,  telecommunications  and multimedia equipment
and products,  some of which dominate certain market segments. In addition,  the
Company  is  aware  of  others  that  are  developing,  and in some  cases  have
introduced,   new  DVC  systems.  Most  of  the  Company's  competitors  possess
substantially greater financial,  marketing,  personnel and other resources than
the Company, have established reputations relating to product design, develop-

                                       34


<PAGE>
ment, manufacture,  marketing and service of networking,  telecommunications and
video  products  and  have  significant  budgets  to  permit  them to  implement
extensive  advertising  and  promotional  campaigns  to market new  products  in
response to  competitors.  Among the  Company's  direct  competitors  are Target
Technologies,  Inc., VIVO Software,  Inc.,  Zydacron,  Inc.,  VCON,  Ltd., Corel
Corporation   and  VideoLAN   Technologies,   Inc.  In   addition,   electronics
manufacturers such as Intel actively compete for business in this market.

PATENTS, TRADEMARKS AND PROPRIETARY INFORMATION

   The Company holds a United States patent covering certain fundamental aspects
of   the    compressed    packet    video    Codec    incorporated    into   the
Viewpoint-PRO(Trademark)  system.  The Company may apply for additional  patents
relating to other aspects of its  products.  There can be no assurance as to the
breadth or degree of protection  which existing or future  patents,  if any, may
afford the Company,  that any patent applications will result in issued patents,
that the Company's  patents will be upheld,  if challenged,  or that competitors
will not develop similar or superior  methods or products outside the protection
of any patent issued to the Company.

   The Company  believes that product  recognition  is an important  competitive
factor and,  accordingly,  the Company  promotes  the  Viewpoint-PRO(Trademark),
ViewCast(Trademark),        MultiView(Trademark),        Osprey-1000(Trademark),
SLIC-Video(Trademark),   Viewpoint-VBX(Trademark),   FamilyFone(Trademark)   and
WorkFone(Trademark)  names,  among  others,  in  connection  with its  marketing
activities,  and has  applied for  trademark  registration  for such names.  The
Company's  use of those marks may be subject to challenge by others,  which,  if
successful, could have a material adverse effect on the Company.

   The Company also relies on  confidentiality  agreements  with its  directors,
employees,  consultants and manufacturers and employs various methods to protect
the source codes, concepts, ideas, proprietary know-how and documentation of its
proprietary  technology.  However,  such  methods  may not  afford  the  Company
complete  protection,  and  there  can be no  assurance  that  others  will  not
independently  develop  similar  know-how  or  obtain  access  to the  Company's
know-how or software  codes,  concepts,  ideas and  documentation.  Furthermore,
although  the  Company  has and  expects  to  continue  to have  confidentiality
agreements  with  its  directors,  employees,  consultants,  manufacturers,  and
appropriate  vendors,  there can be no  assurance  that such  arrangements  will
adequately protect the Company's trade secrets.

   The Company  purchases  certain  components  that are  incorporated  into its
products from third- party  suppliers and relies on their  assurances  that such
components do not infringe on the patents of others.  A successful claim against
any  components  used in the Company's  products could affect the ability of the
Company to  manufacture,  supply and support its products.  The Company uses its
best efforts to ensure third party supplied components are  non-infringing,  but
there can be no assurances against future claims.

GOVERNMENT REGULATION

   The Company is subject to regulations  relating to electromagnetic  radiation
from its products,  which impose compliance burdens on the Company. In the event
the Company  redesigns  or otherwise  modifies  its  products or  completes  the
development  of new  products,  it will  be  required  to  comply  with  Federal
Communications  Commission  regulations with respect to such products,  of which
there can be no assurance  prior to their  commercialization.  In addition,  new
legislation  and  regulations,  as  well  as  revisions  to  existing  laws  and
regulations,  at the  federal,  state and local  levels may be  proposed  in the
future  affecting the video  communications  industries.  Such  proposals  could
affect the Company's operations, result in material capital expenditures, affect
the  marketability of its products and limit  opportunities for the Company with
respect to  modifications  of its  products  or with  respect to new or proposed
products or  technologies.  Expansion into foreign  markets may also require the
Company  to comply  with  additional  regulatory  requirements.  The  technology
contained  in the  Company's  products may be subject to U.S.  export  controls.
There can be no assurance  that such export  controls,  either in their  current
form or as may be  subsequently  enacted,  will not  delay  introduction  of new
products or limit the Company's  ability to distribute  products  outside of the
United States. Further, various countries may

                                       35


<PAGE>
regulate the import of certain technologies contained in the Company's products.
Any such  export  or import  restrictions,  new  legislation  or  regulation  or
government  enforcement of existing  regulations  could have a material  adverse
effect on the Company's business,  operating results and/or financial condition.
There  can be no  assurance  that  the  Company  will  be able  to  comply  with
additional  applicable laws and regulations  without  excessive cost or business
interruption,  if at all,  and failure to comply  could have a material  adverse
effect on the Company.

EMPLOYEES

   
   As of September  30,  1996,  the Company had 35  employees,  4 of whom are in
executive  positions,  19 of whom  are  engaged  in  engineering,  research  and
development,  6 of whom are engaged in marketing and sales  activities  and 6 of
whom are in administration.  None of the Company's employees is represented by a
labor union. The Company considers its employee relations to be satisfactory.
    

FACILITIES

   The  Company's  executive  offices and  assembly  operations  and some of its
design and  development  activities are located in  approximately  16,159 square
feet of leased space in Dallas,  Texas.  The lease  expires in September of 1997
and provides for a base annual rent of $143,110. Osprey's design and development
activities  are located in  approximately  2,783  square feet of leased space in
Cary,  North Carolina.  The lease expires in December of 1997 and provides for a
base annual rent of $38,334.  The Company  leases an office suite in Burlingame,
California of approximately 100 square feet on a month-to-month basis for a base
annual rent of $4,800. The Company believes that its facilities are adequate for
its current and reasonably  foreseeable  future needs and its current facilities
can accommodate expansion, if required.

LEGAL PROCEEDINGS

   The Company is not currently a party to any litigation that it believes could
have a material adverse effect on the Company or its business.

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<PAGE>
                                  MANAGEMENT

DIRECTORS AND EXECUTIVE OFFICERS

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


        NAME          AGE                      POSITION
- -------------------  ----- -----------------------------------------------
Glenn A. Norem.....  44    Chief Executive Officer and Director
Philip M.Colquhoun.  55    President and Chief Operating Officer
David T. Stoner ...  40    Vice-President of Operations
William S. Leftwich  47    Chief Financial Officer and Assistant
                           Secretary
Neal S. Page.......  38    Vice President & General Manager
A. David Boomstein.  41    Vice President of Business Development
Daniel W. Dodson ..  34    Vice President of Marketing
William D. Jobe ...  59    Chairman of the Board of Directors
Joe C. Culp........  63    Director
- ----------

   Glenn A. Norem has been Chief Executive Officer and a director of the Company
since its inception in February 1994. Mr. Norem has been Chief Executive Officer
of each of the Company's  subsidiaries  since their respective  inceptions.  Mr.
Norem has also been Chairman and Chief Executive  Officer of Catalyst  Financial
Corporation   ("Catalyst"),   an  investment  and  business   advisory  firm  to
development stage companies in the computer and communications industries, since
its inception in January 1990. From March 1984 to December 1989, Mr. Norem was a
general  partner of Berry Cash Southwest  Partnership,  L.P., a venture  capital
partnership.  From May 1985 to December 1989, Mr. Norem was a general partner of
InterWest III, L.P., a venture  capital  partnership  and, from 1983 to 1984, he
was Corporate Strategic Business Development Manager at Texas Instruments,  Inc.
Mr. Norem began his career with IBM Corporation's System Communications Division
R  &  D   Laboratory.   Mr.  Norem   received  a  B.S.   degree  in   Electrical
Engineering/Systems Engineering from Southern Illinois University and an M.B.A.
(Finance and Marketing) from the University of Chicago.

   Philip M. Colquhoun was appointed  President and Chief  Operating  Officer of
the Company in April 1996. He had been President of Viewpoint Systems,  Inc. and
Osprey  Technologies,  Inc., both  subsidiaries  of the Company,  since November
1995.  From August 1994 to October  1995,  Mr.  Colquhoun  was  President of the
Connectworks Division of Connectware Inc., a wholly owned subsidiary of AMP Inc.
From September 1991 to August 1994, Mr.  Colquhoun served as President and Chief
Executive Officer of Visual Information  Technologies Inc., a manufacturer of PC
video,  graphics and imaging  products,  which was sold to Connectware Inc. From
February  1990 to  September  1991,  he was  Senior  Vice  President  of  Visual
Information  Technologies  Inc. From August 1984 to February 1990, Mr. Colquhoun
served  Recognition  Equipment  Inc.  in  various  capacities,   including  Vice
President  Manufacturing,  Vice President and General Manager,  Special Products
Division  and  President,  Postalogic  Division.  Mr.  Colquhoun  was  the  Vice
President of Finance and  Administration  for Nixdorf Computer  Corporation from
1981 to 1984 and was  employed by IBM  Corporation  from 1961 to 1981 in various
engineering, finance and manufacturing positions.

   David T. Stoner joined the Company as Vice  President of Operations in August
1996.  From  August  1994 to August  1996,  Mr.  Stoner  was Vice  President  of
Engineering for the Connectworks  Division of Connectware,  Inc., a wholly owned
subsidiary of AMP Inc. From July 1986 to August 1994, Mr. Stoner was employed by
Visual  Information  Technologies,  Inc.  ("VITec"),  a  manufacturer  of video,
imaging,  and graphics  products,  which was purchased by  Connectware,  Inc. At
VITec,  Mr. Stoner was  responsible for the development of hardware and software
products,   and  served  in  various  positions   including  Vice  President  of
Engineering.  From  January  1979 to July  1986,  Mr.  Stoner  served in various
engineering  positions at Texas  Instruments,  Inc. Mr. Stoner received his B.S.
degree in Electrical Engineering from the University of Kansas.

   William S.  Leftwich has been Chief  Financial  Officer of the Company  since
March 1995.  From  January  1993 to March  1995,  Mr.  Leftwich  served as Chief
Financial Officer, Treasurer and Secretary of Integrated Security Systems, Inc.,
a manufacturer, developer, and distributor of integrated security so-

                                       37

<PAGE>
lutions. From August 1992 to December 1992, Mr. Leftwich served as Controller of
Thomas Group Holding Company, an affiliate of Integrated Security Systems,  Inc.
Mr. Leftwich was  self-employed  as a financial  consultant from January 1992 to
July 1992.  From January 1989 to December 1991, Mr. Leftwich served as the Chief
Financial  Officer  of OKC  Limited  Partnership,  an oil  and  gas  exploration
company. For approximately seven years prior to joining OKC Limited Partnership,
Mr.  Leftwich  served as Vice President -- Finance for Endevco,  Inc., a natural
gas transportation and processing company. Mr. Leftwich is a C.P.A. and received
a B.B.A. from Texas A&M University.

   Neal S.  Page has been Vice  President  and  General  Manager  of the  Osprey
division of the Company since January 1995.  From October 1994 to December 1994,
Mr. Page served as Director of Product  Development  of the Company.  From April
1988 to September 1994, Mr. Page was employed by Sun Microsystems  where he held
management  positions  directing  development  and strategic  relationships  for
multimedia technology products. Mr. Page developed advanced graphics and imaging
products at General  Electric from 1984 to 1988 and at Data General from 1983 to
1984.  Mr.  Page  holds  B.S.  and  M.S.  degrees  in  Electrical  and  Computer
Engineering from North Carolina State University.

   A. David  Boomstein  has been Vice  President of Business  Development  since
February  1995.  From  January  1994 to January  1995,  Mr.  Boomstein  was Vice
President  for  Desktop  Programs  at  Applied  Business  Telecommunications,  a
consulting  and  research  firm  focusing  on  teleconferencing  and  multimedia
applications.  From January 1989 to December  1993,  Mr.  Boomstein  worked with
Boeing Computer Support  Services,  Inc. on a mission  services  contract to the
National   Aeronautics  and  Space   Administration   designing  and  installing
videoconferencing  systems among NASA's world-wide partners.  From December 1984
to December 1988, Mr.  Boomstein was Product  Marketing  Manager for Compression
Labs,  Inc.'s  Rembrandt  Video  System.  From June 1980 to November  1984,  Mr.
Boomstein  managed the development  and deployment of Citicorp N.A.'s  satellite
videoconferencing  system. Mr. Boomstein received a B.F.A. in Communication Arts
from  the  New  York  Institute  of  Technology  and an  M.P.S.  in  Interactive
Telecommunications from New York University.

   Daniel W.  Dodson  joined  the  Company as Vice  President  of  Marketing  in
February  1996.  From October 1994 to February  1996, Mr. Dodson was Director of
Marketing for the  Connectworks  Division of  Connectware,  Inc., a wholly owned
subsidiary of AMP Inc. While at Connectware  Mr. Dodson was  responsible for the
market introduction of hardware and software communications  products. From 1983
to October 1994, Mr. Dodson was employed by NorTel (formerly Northern Telecom) a
major manufacturer of telecommunications equipment. At NorTel, Mr. Dodson served
in various positions including  marketing manager for desktop  videoconferencing
products and senior software designer for digital switching products. Mr. Dodson
received his MBA from Harvard University and his B.S. degree in Computer Science
from North Carolina State University.

   William D. Jobe has been Chairman of the Board of the Company since  November
1994.  Since July  1991,  Mr.  Jobe has been a private  venture  capitalist  and
computer industry  advisor.  From June 1990 to July 1991, Mr. Jobe was President
of MIPS Technology  Development,  a subsidiary of MIPS Computer Systems, Inc., a
supplier of reduced  instruction  set computing  products and  technology.  From
September  1987 to June 1990,  Mr. Jobe was Executive  Vice President for Sales,
Marketing and Service of MIPS Computer Systems, Inc. From 1993 through 1995, Mr.
Jobe  was   Chairman  and  a  director  of  Great  Bear   Technology,   Inc.,  a
publicly-traded supplier of interactive multimedia software. Mr. Jobe received a
B.S.M.E.  and a M.S.M.E.  from Texas A & M University and a P.M.D.  from Harvard
Business School.

   Joe C. Culp has been a director of the Company  since  November  1995.  Since
1990,  Mr.  Culp has  served as  President  of Culp  Communications  Associates,
engaging in senior level  consulting in the  telecommunications  industry.  From
1989  to  1990,  Mr.  Culp  was  Executive  Vice  President  of   Communications
Transmission,  Inc., a telecommunications  provider. From 1988 to 1989, Mr. Culp
served as  President  and Chief  Executive  Officer of  LIGHTNET,  a fiber optic
telecommunications  carrier  jointly owned by CSX  Corporation  and Southern New
England  Telecommunications.   From  1982  to  1988,  Mr.  Culp  was  President,
Telecommunications for Rockwell  International.  Since 1994, Mr. Culp has served
on the Chairman's Advisory Board of Newbridge Networks a publicly-traded company
and  since  1996,  has  served as a  director  of IXC  Communications,  a public
company. Mr. Culp received a B.S.E.E. from the University of Arkansas.

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<PAGE>
   All directors hold office until the next annual  meeting of the  stockholders
and the election and qualification of their successors.  Executive  officers are
elected by the Board of Directors  annually and serve at the  discretion  of the
Board.

   
   Messrs.  Norem,  Jobe and Culp are  members  of the  Audit  and  Compensation
Committees of the Board of Directors.    

DIRECTOR COMPENSATION

   Directors  currently receive no cash compensation for serving on the Board of
Directors other than reimbursement of reasonable  expenses incurred in attending
meetings.  In June 1993, Mr. Jobe was granted an option to purchase 5,110 shares
of Common Stock under the 1993 Stock  Option Plan at an exercise  price of $0.20
per share.  This option is fully vested.  In November 1994, Mr. Jobe was granted
an option to purchase 125,000 shares of Common Stock under the 1994 Option Plan,
at an exercise  price of $3.00 per share.  The option vests as to one quarter of
the shares subject to the option one year from the date of grant and one quarter
of the shares subject to the option each year thereafter subject to acceleration
based on the Company's performance. In November 1995, Mr. Jobe and Mr. Culp were
each granted options to purchase 40,000 shares of Common Stock exercisable $3.00
per share  under the 1995  Option  Plan for  consulting  activity in addition to
their  director  responsibilities.  These  options  vest  over a three  (3) year
period.

   
   In May 1995, the Company  adopted a 1995 Director  Option Plan (the "Director
Plan") under which only outside directors are eligible to receive stock options.
The  Director  Plan  provides  for the grant of  nonstatutory  stock  options to
directors  who are not  employees of the Company.  A total of 250,000  shares of
Common Stock have been  authorized  for issuance  under the Director Plan. As of
September  30, 1996,  options to purchase an  aggregate  of 25,000  shares at an
exercise price of $3.00 per share had been granted under the Director Plan. Each
non-employee  director who joins the Board after May 1, 1995 will  automatically
be granted a  nonstatutory  option to purchase  15,000 shares of Common Stock on
the date upon which such person first becomes a director. In addition, each such
non-employee  director will  automatically  be granted a nonstatutory  option to
purchase  10,000  shares of Common Stock upon annual  re-election  to the Board,
provided  the  director  has been a member of the Board for at least six  months
upon the date of  re-election.  The exercise  price of each option granted under
the  Director  Plan is equal to the fair market value of the Common Stock on the
date of grant.  Each initial  15,000 share grant vests at the rate of 25% of the
option  shares  upon  the  first  anniversary  of the  date  of  grant  and  one
forty-eighth of the option shares per month  thereafter,  and each annual 10,000
share  grant  vests  at the rate of 25% of the  option  shares  upon  the  first
anniversary of the date of grant and one  forty-eighth of the options shares per
month thereafter,  in each case unless terminated sooner upon termination of the
optionee's  status as a director or otherwise  pursuant to the Director Plan. In
the event of a merger  of the  Company  with or into  another  corporation  or a
consolidation,  acquisition  of assets or other  change in  control  transaction
involving the Company,  each option  becomes  exercisable  unless  assumed or an
equivalent option  substituted by the successor  corporation.  Unless terminated
sooner, the Director Plan will terminate in 2005. The Director Plan is currently
administered  by the Board of  Directors.  The Board has  authority  to amend or
terminate the Director Plan,  provided that no such action may impair the rights
of any optionee without the optionee's consent.     

EXECUTIVE COMPENSATION

   The following table sets forth the cash  compensation  paid or accrued by the
Company  to the  Company's  Chief  Executive  Officer  and the  Company's  other
executive  officers whose  compensation  exceeded  $100,000 for the fiscal years
ended December 31, 1995, 1994 and 1993.

   No other officer  received cash  compensation  in excess of $100,000 in 1993,
1994, or 1995.

                                       39

<PAGE>
                          SUMMARY COMPENSATION TABLE

<TABLE>
<CAPTION>
                                                                                                              LONG TERM
                                                                         ANNUAL COMPENSATION                COMPENSATION
                 NAME AND                                               ---------------------                 OPTIONS
            PRINCIPAL POSITION                        FISCAL YEAR        SALARY           BONUS              (IN SHARES)
            ------------------                        -----------        ------           -----              -----------
<S>                                                      <C>         <C>                <C>     <C>                <C>
Glenn A. Norem                                           1995        $ 90,000           $45,000 (4)              --(1)
Chief Executive Officer .........................        1994          91,875(2)         45,000 (4)         130,000
                                                         1993         135,000(3)             --              51,100

William S. Leftwich                                      1995          90,000(5)         15,000 (6)          60,000
Chief Financial Officer .........................        1994              --                --                  --
                                                         1993              --                --                  --
                                                                                                                   
Philip M. Colquhoun                                      1995          90,000(7)          3,500             200,000
President and Chief Operating                            1994              --                --                  --
Officer .........................................        1993              --                --                  --
</TABLE>
- ----------
(1)  Does not include warrants to purchase 118,500 shares of Common Stock of the
     Company granted to Mr. Norem and Norem I, L.P. in connection with financing
     transactions. See "Certain Transactions".

(2)  $22,500  of such  amount was  accrued as of  December  31,  1994,  of which
     $11,250 was paid in 1995. The remaining  $11,250 was accrued as of December
     31, 1995.

(3)  Represents Mr.  Norem's  salary as President and CEO of Viewpoint  prior to
     its  acquisition  by the  Company.  All of such  amount  was  accrued as of
     December  31,  1993;  $70,871 of such  amount was paid  during 1994 and the
     remaining $64,129 was accrued as of December 31, 1995.

(4)  In  September  1996 this amount was  exchanged  into a note  payable to Mr.
     Norem due in December 1997.

(5)  Represents Mr.  Leftwich's  annual  salary.  He assumed his duties with the
     Company on March 29, 1995 and earned $67,268 in salary during 1995.

(6)  Amount  was  accrued  as of  December  31,  1995 and will be paid  from the
     proceeds of this offering.

(7)  Represents  Mr.  Colquhoun's  annual  salary.  He  assumed  his  duties  as
     President of the Viewpoint and Osprey  subsidiaries on November 1, 1995 and
     earned $14,880 in salary during 1995. Mr.  Colquhoun  assumed the duties of
     President and Chief Operating Officer of the Company in April 1996.

   The following table provides  information  concerning  options granted to the
executive officers of the Company in 1995.

                        OPTION GRANTS IN LAST FISCAL YEAR


                                      % OF TOTAL
                                    OPTIONS GRANTED   EXERCISE OR
                         OPTIONS    TO EMPLOYEES IN      BASE        EXPIRATION
        NAME             GRANTED      FISCAL YEAR     PRICE/SHARE       DATE
- --------------------  ------------ ---------------- -------------- -------------
Glenn A. Norem......         --           --                 --            --
William S. Leftwich.     60,000 (1)     10.9          $    3.00       3/26/05
Phillip M. Colquhoun    200,000 (2)     36.4               3.00      10/31/05

   
(1)  34,000 of these options are currently exercisable.  All options will become
     immediately exercisable upon a "change in control" of the Company.

(2)  46,666 of these options are currently exercisable.  All options will become
     immediately exercisable upon a "change in control" of the Company.
    

EMPLOYMENT AGREEMENTS

   The Company has entered into a five-year  employment  agreement with Glenn A.
Norem,  effective  February 7, 1994,  which provides for his employment as Chief
Executive  Officer.  The  employment  agreement  provides  for  an  annual  base
compensation of $90,000, subject to increases upon review by the Board of

                                       40

<PAGE>
Directors,  and annual bonuses at the  discretion of the Board of Directors.  In
the event the employment agreement is terminated, (other than "for cause" by the
Company)  including for "good  reason" by Mr. Norem  including in the event of a
"change of control" as defined in the agreement, then Mr. Norem will receive (i)
all accrued salary,  bonuses and benefits through the date of such  termination;
and (ii) a sum equal in the  aggregate to the full amount,  discounted  by three
percent  (3%),  of (a) the  salary  and  benefits  which Mr.  Norem  would  have
received,  at the average rate or rates in effect  during the  six-month  period
immediately prior to termination,  and (b) the annual bonus or bonuses which Mr.
Norem  would have  received,  at the rate of his annual  bonus for the last full
fiscal year of the Company  ending prior to  termination,  had,  with respect to
both (a) and (b), Mr. Norem's  employment under the agreement  continued through
the  full  term  of  the  agreement.  The  employment  agreement  also  contains
provisions  granting Mr. Norem certain piggyback and demand  registration rights
that require the Company to register  under the Securities Act any or all shares
of the Company's  Common Stock held by Mr.  Norem,  or issuable upon exercise of
stock  options held by Mr.  Norem.  The  employment  agreement is  automatically
renewed for successive one year terms unless the Company or Mr. Norem elects not
to renew.

   In January 1996, Mr. Norem's employment agreement was amended to increase his
annual base  compensation to $135,000 and provide for a minimum bonus of $15,000
per year.  Concurrent  with the  amendment,  the Board of Directors  granted Mr.
Norem a bonus of  $45,000  per year for 1994 and 1995 to be paid  only  upon the
authorization  of the  Board  of  Directors.  In  September  1996,  Mr.  Norem's
employment agreement was amended to include a non-compete, non-solicitation, and
non-circumvention  agreement with the Company for the duration of his employment
and  through  the  two  years  immediately  following  the  termination  of  his
employment with the Company.

   Pursuant to the consulting  agreement  with  Catalyst,  of which Mr. Norem is
Chairman of the Board and principal stockholder, Catalyst may, in specific cases
approved by the Company's Board of Directors,  receive fees in connection with a
merger with or the acquisition of another company  previously  introduced to the
Company by Catalyst and expressly named in the agreement.  Catalyst will be paid
3% of the fair market value of each  transaction  actually  consummated plus has
the right to purchase for $1.00, a three year option to purchase Common Stock of
the Company. The number of shares that this option can purchase will be equal to
3% of the fair  market  value of the  transaction  divided by the  average  fair
market  price of the Common  Stock of the  Company  during  the one week  period
preceding the  announcement of the  transaction.  The Consulting  Agreement with
Catalyst  was  terminated  by the Company on  September  27,  1996.  Despite the
termination,  Catalyst  remains  entitled to receive fees if the Company  enters
into a merger or acquisition  transaction as described above. The Company has no
plans to enter  into  such a  transaction  at this  time or for the  foreseeable
future.

   The Company has also entered into  employment  agreements  with its six other
executive officers:  Messrs. Colquhoun,  Leftwich, Stoner, Dodson, Boomstein and
Page. These employment  agreements  provide (i) for annual base  compensation of
$90,000, $90,000, $120,000, $85,000, $75,000 and $90,000 respectively; (ii) that
the officer is eligible to  participate  in the Company's  Employee Stock Option
Plans and Executive  Bonus Plans;  and (iii) that the employment of each officer
with the  Company  is "at  will" and may be  terminated  by the  officer  or the
Company at any time, for any reason or no reason.

EMPLOYEE STOCK PLANS

   1995 Stock Plan

   
   The 1995  Stock  Plan (the  "1995  Option  Plan")  provides  for the grant to
employees  of the  Company of  incentive  stock  options  within the  meaning of
Section 422 of the Internal  Revenue  Code of 1986,  as amended (the "Code") and
for the grant to employees and consultants of the company of nonstatutory  stock
options and stock purchase  rights.  A total of 2,000,000 shares of Common Stock
have been reserved for issuance  under the 1995 Option Plan. As of September 30,
1996,  options had been granted to purchase an aggregate of 758,025 shares at an
exercise price of $3.00 per share,  160,000 shares at an exercise price of $3.30
per share and 126,000 shares at an exercise  price of $4.00 per share.  The 1995
Option  Plan may be  administered  by the Board or a  committee  approved by the
Board in a manner that complies with Rule 16b-3 promulgated under the Securities
Act. Currently,  the 1995 Option Plan is administered by the Board of Directors,
which determines the terms of options and rights granted, exercise price, number
of shares subject to the option or right     

                                       41


<PAGE>
and the exercisability thereof. Options and rights granted under the 1995 Option
Plan  are  not  transferable  other  than by will  or the  laws  of  descent  or
distribution, and each option or right is exercisable during the lifetime of the
recipient  only by such  person.  Options  that are  outstanding  under the 1995
Option Plan will remain  outstanding  until they are exercised or they expire in
accordance  with the terms of each option.  The exercise  price of all incentive
stock  options  granted under the 1995 Option Plan must be at least equal to the
fair  market  value of the  shares  of Common  Stock on the date of grant.  With
respect to any participant who owns stock possessing more than 10% of the voting
power  of all  classes  of  stock  of the  Company,  the  exercise  price of any
incentive stock option granted must equal at least 110% of the fair market value
on the grant date and the maximum term of the option must not exceed five years.
The term of all other options  granted under the 1995 Option Plan may not exceed
ten years. In the event of certain  changes in control of the Company,  the 1995
Option Plan permits each outstanding  option and right to become  exercisable in
full or assumed  or an  equivalent  option to be  substituted  by the  successor
corporation.  Included are options to purchase 160,000 shares at $3.30 per share
granted to Mr. Norem in January 1996, options to purchase 40,000 shares at $3.00
per share granted to each of Mr. Jobe and Mr. Culp in November 1995,  options to
purchase  200,000 shares at $3.00 per share and 50,000 shares at $3.00 per share
granted to Mr.  Colquhoun  in November  1995 and April 1996,  respectively,  and
options to purchase  60,000 shares at $3.00 per share and 30,000 shares at $3.00
per share granted to Mr. Leftwich in March 1995 and January 1996,  respectively.
The options granted to Messrs. Norem,  Colquhoun,  and Leftwich vest over a five
year period. The options granted to Messrs. Jobe and Culp vest over a three year
period. See "Executive Compensation" and "Principal Stockholders".

   1994 Stock Option Plan

   In February  1994,  the Board of  Directors  and  stockholders  approved  the
Company's  1994 Stock Option Plan (the "1994 Option Plan")  pursuant to which an
aggregate  of  2,000,000  shares of Common  Stock were  reserved for issuance in
connection with the stock options  ("Options")  available for grant. The Options
may be granted in either or both of the following:  (i) Incentive  Stock Options
or (ii) Non-Qualified Stock Options.  Non-Qualified Stock Options may be granted
to employees, directors and consultants of the Company.

   The 1994 Option Plan was  administered by the Board of Directors or, at their
discretion,  by a committee  which was  appointed  by the Board to perform  such
function.  The  Board  or  such  committee,  as the  case  may  be,  within  the
limitations  of the 1994 Option Plan,  determined,  among other things,  when to
grant  Options,  the persons to whom Options  were to be granted,  the number of
shares for each Option,  whether  Options  granted were intended to be Incentive
Stock Options or Non-Qualified Stock Options,  the duration and rate of exercise
of each Option, the share purchase price and the manner of exercise, and whether
restrictions  such as  repurchase  rights by the  Company  were to be imposed on
shares subject to Options.

   In  connection  with  Incentive  Stock  Options  the  exercise  price of each
Incentive  Stock  Options may not be less than 100% of the fair market  value of
the Common  Stock on the date of grant (or 110% of fair market value in the case
of an employee holding 10% or more of the outstanding stock of the Company). The
aggregate fair market value of shares for which  Incentive Stock Options granted
to any employee are  exercisable  for the first time by such employee during any
calendar year (pursuant to all stock option plans of the Company and any related
corporation) may not exceed $100,000. Non-qualified Stock Options may be granted
at a price  determined by the Board or  Committee,  but not at less than the par
value of the Common  Stock.  Stock options  granted  pursuant to the 1994 Option
Plan will  expire not more than ten years from the date of grant  (five years in
the case of the Incentive  Stock Options  granted to persons holding 10% or more
of the voting stock of the Company).

   
   As of September  30, 1996,  options had been granted to purchase an aggregate
of 908,016  shares as  follows:  70,000  shares at an  exercise  price of $0.10;
222,633  shares at an  exercise  price of $2.20;  130,000  shares at an exercise
price of $2.42;  and 485,383 shares at an exercise price of $3.00.  Included are
options to purchase 130,000 and 125,000 shares at a price of $2.42 and $3.00 per
share, respectively,  granted to Messrs. Norem and Jobe in May 1994 and November
1994,  respectively,  all of which expire in May 1999 and November 1999 and vest
at the rate of 20% per  year as to Mr.  Norem  and 25% per  year as to Mr.  Jobe
commencing  in May 1995 and  November  1995,  respectively,  subject  to certain
acceleration provisions. In April 1995, the Board of Directors voted to grant no
further  options under the 1994 Option Plan.  See "Executive  Compensation"  and
"Principal Stockholders."     

                                       42


<PAGE>
   1993 Stock Option Plan

   In May 1994,  pursuant  to the terms of the  acquisition  of  Viewpoint,  the
Company assumed the obligations of Viewpoint's 1993 Stock Option Plan (the "1993
Option  Plan").  Stock options to purchase  287,564  shares of Common Stock were
assumed by the Company.  Accordingly,  the Company  reserved  287,564  shares of
Common Stock for issuance pursuant to these outstanding stock options.

   Since the  assumption  of the 1993 Option Plan,  stock options to purchase an
aggregate of 178,427  shares have been  exercised  and stock options to purchase
5,588 shares have been cancelled.  Of the remaining  options to purchase 103,549
shares of Common Stock, options to purchase 51,100 shares at a price of $.04 per
share were granted to Mr. Norem.  These options are fully exercisable and expire
in  November  1998.  In early  1995,  the Board of  Directors  voted to grant no
further  options under the 1993 Option Plan.  See "Executive  Compensation"  and
"Principal Stockholders."

   1995 Employee Stock Purchase Plan

   In May 1995 the Company  established  an Employee  Stock  Purchase  Plan (the
"ESPP") to provide  employees  of the Company  with an  opportunity  to purchase
Common Stock through payroll deductions. Under the ESPP, up to 250,000 shares of
Common Stock have been  reserved for issuance,  subject to certain  antidilution
adjustments.  The ESPP,  by its  terms,  becomes  effective  at the time of this
offering.  The ESPP is intended to qualify as an employee  stock  purchase  plan
within the meaning of Section 423 of the Internal Revenue Code.

   
   Each  offering  period  will be for a period of six  months  except the first
offering period under the ESPP will be from the date of this Prospectus  through
April 30, 1997.  The ESPP  terminates  in April,  2005.  Eligible  employees may
participate in the ESPP by  authorizing  payroll  deductions  during an offering
period  within  a  percentage  range  determined  by  the  Board  of  Directors.
Initially, the amount of authorized payroll deductions will be not more than 10%
of an employee's cash compensation  during an offering period, but not more than
$25,000 per year.  Amounts  withheld from payroll are applied at the end of each
offering  period to purchase shares of Common Stock.  Participants  may withdraw
their  contributions at any time before stock is purchased,  and in the event of
withdrawal such contributions will be returned to the participants. The purchase
price of the Common  Stock is equal to 85% of the lower of (i) the market  price
of Common Stock  immediately  before the  beginning of the  applicable  offering
period  or (ii) the  market  price of Common  Stock at the end of each  offering
period.  All  expenses  incurred  in  connection  with  the  implementation  and
administration of the ESPP will be paid by the Company.     

   Director Stock Option Plan

   In May 1995,  the Company  adopted  the  Director  Plan under  which  outside
directors only are eligible to receive stock options. The Director Plan provides
for the grant of  nonstatutory  stock options to directors who are not employees
of the Company. See "Management -- Director Compensation."

LIMITATION OF LIABILITY AND INDEMNIFICATION MATTERS

   As  permitted  by the  Delaware  General  Corporation  Law,  the  Company has
included in its  Certificate  of  Incorporation  a provision  to  eliminate  the
personal  liability of its directors for monetary  damages for breach or alleged
breach of their fiduciary duties as directors, subject to certain exceptions. In
addition,  the bylaws of the  Company  provide  that the  Company is required to
indemnify  its  officers  and  directors,  employees  and agents  under  certain
circumstances,  including those  circumstances  in which  indemnification  would
otherwise be  discretionary,  and the Company is required to advance expenses to
its officers and directors as incurred in connection  with  proceedings  against
them for which they may be  indemnified.  The bylaws  provide  that the Company,
among other things,  will indemnify  such officers and directors,  employees and
agents against certain  liabilities  that may arise by reason of their status or
service as directors,  officers,  or employees (other than  liabilities  arising
from willful  misconduct of a culpable  nature),  and to advance their  expenses
incurred as a result of any  proceeding  against  them as to which they could be
indemnified.  At present,  the Company is not aware of any pending or threatened
litigation or proceeding involving a director, officer, employee or agent of the
Company in which  indemnification  would be required or  permitted.  The Company
believes  that  its  charter  provisions  and  indemnification   agreements  are
necessary to attract and retain qualified persons as directors and officers.

                                       43


<PAGE>
                             PRINCIPAL STOCKHOLDERS

   
   The following  table sets forth  information  as of September 30, 1996 and as
adjusted to reflect  the sale of Common  Stock  offered by the  Company  hereby,
based on information  obtained from the persons named below, with respect to the
beneficial  ownership  of shares of Common  Stock by (i) each  person or a group
known by the Company to be the owner of more than 5% of the  outstanding  shares
of Common Stock,  (ii) each director,  (iii) each executive officer named in the
Summary Compensation Table under the caption "Management", and (iv) all officers
and directors as a group.     

<TABLE>
<CAPTION>
                                                                                           PERCENTAGE OF OUTSTANDING    
                                                AMOUNT AND                                     SHARES OWNED(2)(3)       
                                                NATURE OF                                  ---------------------------  
        NAME AND ADDRESS                        BENEFICIAL                                 PRIOR TO                     
    OF BENEFICIAL OWNER(1)                     OWNERSHIP(2)                                OFFERING    AFTER OFFERING   
<S>                                         <C>                                              <C>        <C>             
Fred Kassner ...................                1,375,242(4)                                 15.0          12.6         
 69 Spring Street                                                                                                       
Ramsey, NJ 07446                                                                                                        
Robert Moody, Jr. ..............                1,086,531(5)                                 11.9           9.9         
 601 Moody National Bank Building
 Galveston, TX 77550 ...........                                                                                        
H.T. Ardinger, Jr. .............                1,047,455(6)                                 11.5           9.6         
 9040 Governors Row                                                                                                     
 Dallas, TX 75247                                                                                                       
Glenn A. Norem .................                  835,148(7)                                  9.1           7.6         
M. Douglas Adkins...............                  688,759(8)                                  7.5           6.3         
 1601 Elm Street, #3000                                                                                                 
 Dallas, TX 75201                                                                                                       
Robert Sterling Trust ..........                  532,059(9)(10)                              5.8           4.9         
 c/o Thomas E. Brown                                                                                                    
 1715 West 35th Street                                                                                                  
 Pine Bluff, AR 71603                                                                                                   
Robert Bernardi Trust...........                 430,394(11)                                  4.7           3.9         
 c/o Richard Bernardi                                                                                                   
 440 Wood Crest Road                                                                                                    
 Stratford, PA 19087                                                                                                    
William D. Jobe.................                  84,414(12)                                    *             *         
William S. Leftwich ............                  40,000(13)                                    *             *         
Joe C. Culp ....................                  19,930(14)                                    *             *         
Philip M. Colquhoun.............                  46,666(15)                                    *             *         
David T. Stoner.................                      --(16)                                    *             *         
All officers and directors as a                                                                                         
 group (nine persons)...........            1,129,870(7)(12)(13)(14)(15)(16)(17)             12.4          10.3         
                                                                                                                        
</TABLE>                                                                       
   Messrs.  Sterling and Bernardi may be deemed to be "founders" of the Company,
as such term is defined under the federal securities laws.

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

(1)  Unless  otherwise  indicated,  the  address of each  individual  is c/o the
     Company, 2665 Villa Creek Drive, Dallas, Texas 75234.
(2)  A person is deemed to be the  beneficial  owner of  securities  that can be
     acquired  by such  person  within 60 days from the date of this  Prospectus
     upon  the  exercise  of  warrants  or  options.   Each  beneficial  owner's
     percentage  ownership is  determined  by assuming  that options or warrants
     that are held by such person  (but not those held by any other  person) and
     which are exercisable  within 60 days from the date of this Prospectus have
     been exercised.  Unless otherwise indicated,  the Company believes that all
     persons  named in the table  have sole  voting  and  investment  power with
     respect to all shares of Common Stock beneficially owned by them.
   
(3)  Based on a total of (i)  5,054,314  shares  issued  and  outstanding,  (ii)
     477,244 shares of Common Stock issued on the date of this  Prospectus  upon
     the  conversion  of $2,330,300  principal  amount of  Convertible  Debt and
     approximately $342,294 accrued interest (based on an assumed offering price
     of $5.50 per share and $.10 per Public Warrant),  (iii) 1,442,505 shares of
     Common Stock reserved for issuance upon exercise of outstanding warrants to
     purchase common stock, (iv) 1,280,900 shares     

                                       44

<PAGE>
   
     of Common Stock reserved for issuance upon exercise of the Convertible Debt
     Warrants and (v) 888,196  shares of Common Stock reserved for issuance upon
     exercise of vested stock options as of September 30, 1996. Does not include
     (i) 180,000  shares of Common Stock  reserved for issuance upon exercise of
     the Underwriters' Warrants, and 180,000 shares of Common Stock reserved for
     issuance upon exercise of Underwriters' Public Warrants.  See "Management's
     Discussion and Analysis of Financial  Condition and Results of Operations,"
     "Management  -- Employee  Stock Plans,"  "Description  of  Securities"  and
     "Underwriting."

(4)  Includes (i) 35,714 shares issuable upon the conversion of Convertible Debt
     to equity, (ii) 100,000 shares issuable at $3.00 per share upon exercise of
     warrants  issued in connection  with the conversion of Convertible  Debt to
     equity,  (iii) 65,000  shares  issuable at $3.00 per share upon exercise of
     warrants  issued in connection  with the  conversion of Secured Notes II to
     equity,  (iv) 100,000  shares  issuable at $3.00 per share upon exercise of
     warrants issued in connection with the Convertible Debt II.

(5)  Includes (i) 250,000 shares  beneficially  owned by Moody Insurance  Group,
     Inc., of which Mr. Moody is Chairman,  President and the sole  stockholder,
     (ii)  warrants  to  purchase  200,000  shares at $1.00 per share  issued in
     connection  with the exchange of a Secured Note for equity,  (iii)  114,280
     shares  issuable  upon the  conversion  of  Convertible  Debt  and  accrued
     interest to equity,  and (iv) warrants to purchase  275,000 shares at $3.00
     per share issued in connection  with the conversion of Convertible  Debt to
     equity.

(6)  Includes (i) 54,501 shares owned by Mr.  Ardinger's  wife, (ii) warrants to
     purchase  120,000  shares at $1.00 per share issued in connection  with the
     exchange of a Secured Note and a Demand Note for equity, held by either Mr.
     Ardinger or his wife,  (iii)  warrants to purchase  375,000 shares at $3.00
     per share issued in connection  with the conversion of Convertible  Debt to
     equity,  (iv) 155,953  shares  issuable upon the  conversion of Convertible
     Debt and accrued  interest  to equity,  and (v) 37,500  shares  issuable at
     $1.00 per share granted for the issuance of a Demand Note.

(7)  Includes (i) 51,100 shares  issuable at $.04 per share upon the exercise of
     options issued under the 1993 Option Plan,  (ii) 95,333 shares  issuable at
     $2.42 per share upon exercise of options issued under the 1994 Option Plan,
     (iii) 75,000  shares  issuable at $1.00 per share upon exercise of warrants
     granted for the  exchange  of a Secured  Note for a Demand  Note,  and (iv)
     16,667 shares  issuable at $3.00 per share upon exercise of warrants issued
     for the repayment of Convertible Debt.

(8)  Includes (i) 25,000 shares issuable at $1.00 per share upon the exercise of
     warrants  granted for the  issuance of a Demand Note,  (ii) 145,500  shares
     issuable at $1.00 per share upon the  exercise  of  warrants in  connection
     with the  exchange  of a  Secured  Note for  equity,  (iii)  50,000  shares
     issuable at $1.00 per share upon  exercise of warrants in  connection  with
     the exchange of a Demand Note for equity,  (iv) 63,388 shares issuable upon
     the conversion of Convertible  Debt and accrued  interest to equity and (v)
     152,500 shares issuable at $3.00 per share upon the exercise of warrants in
     connection with the conversion of Convertible Debt to equity.     

(9)  Shares subject to the control of Thomas E. Brown,  as voting trustee of the
     Robert  Sterling Trust.  On January 24, 1995,  Robert M. Sterling,  Jr. and
     Thomas E. Brown, as voting  trustee,  entered into a Voting Trust Agreement
     covering all capital stock beneficially owned by Mr. Sterling as of January
     24, 1995 or  subsequently  acquired.  The voting trustee is entitled,in his
     discretion,  to vote the shares deposited  therewith and also has exclusive
     investment   control  of  said  shares.   The  Voting  Trust  Agreement  is
     irrevocable  and  expires on January  20,  1998.  Mr.  Sterling is the sole
     beneficiary of the Voting Trust Agreement.
   
(10) Includes  (i) 58,333  shares  issuable at $2.20 per share upon  exercise of
     options  issued under the 1994 Option Plan and (ii) 16,667 shares  issuable
     at $3.00 per share for the  exercise  of warrants  in  connection  with the
     repayment of Convertible Debt.     

(11) Shares subject to the control of Richard Bernardi, as voting trustee of the
     Robert Bernardi Trust. On January 20, 1995,  Robert P. Bernardi and Richard
     Bernardi, as voting trustee, entered into a Voting Trust Agreement covering
     all capital stock beneficially owned by Mr. Bernardi as of January 20, 1995
     or subsequently acquired. The voting trustee is entitled,in his discretion,
     to vote the shares  deposited  therewith and also has exclusive  investment
     control of said shares.  The Voting  Trust  Agreement  is  irrevocable  and
     expires on January 20, 1998.  Mr.  Bernardi is the sole  beneficiary of the
     Voting Trust Agreement.
   
(12) Includes (i) 60,833 shares issuable at $3.00 per share upon the exercise of
     options  granted under the 1994 Option Plan and (ii) 15,555 shares issuable
     at $3.00 per share upon  exercise of options  granted under the 1995 Option
     Plan,  (iii)  5,110  shares  issuable  at $.20 per share upon  exercise  of
     options granted under the 1993 Plan and (iv) 2,916 shares issuable at $3.00
     per share upon exercise of options granted under the 1995 Directors Plan.

(13) Includes  34,000  shares  issuable at $3.00 per share upon the  exercise of
     options  issued  under the 1994  Option Plan and 6,000  shares  issuable at
     $3.00 per share upon the  exercise of options  issued under the 1995 Option
     Plan.

(14) Includes 15,555 shares issuable at $3.00 per share upon exercise of options
     granted  under the 1995 Option Plan and 4,375 shares  issuable at $3.00 per
     share upon exercise of options granted under the 1995 Directors Plan.

(15) Includes  46,666  shares  issuable at $3.00 share upon  exercise of options
     granted under the 1995 Option Plan.
    
(16) None of the  100,000  options to  purchase  Common  Stock of the Company at
     $4.00 per share have vested as of the date of this Prospectus.
   
(17) Includes  81,234 and 22,478 shares  issuable at $3.00 per share to Mr. Page
     and Mr. Boomstein, respectively, upon exercise of options granted under the
     1994 and 1995 Option Plans.
    

                                       45

<PAGE>
                              CERTAIN TRANSACTIONS

   In December 1992, Viewpoint issued 102,200 shares of Common Stock to Glenn A.
Norem,  Chief Executive  Officer of the Company,  in  consideration  of $200 and
issued warrants to purchase  511,000 shares of Common Stock at an exercise price
of $.001 per share to Glenn A.  Norem as  assignee  for  Catalyst,  of which Mr.
Norem was the  Chairman,  Chief  Executive  Officer,  and sole  stockholder,  in
consideration  for services  rendered by Catalyst.  Mr.  Norem  exercised  these
warrants in June 1993.

   During 1993, Mr. Norem loaned  Viewpoint an aggregate of $90,700 at an annual
interest rate of 8%. These loans were repaid by the Company in November 1994. In
connection with these loans  Viewpoint  issued warrants to Mr. Norem to purchase
an aggregate of 11,587 shares of Common Stock at an exercise  price of $0.20 per
share. Mr. Norem exercised these warrants in May 1994.

   During  1993 and 1994,  G.A.  Norem I, L.P.,  of which Mr.  Norem is the sole
general partner,  loaned Viewpoint an aggregate of $35,500 at an annual interest
rate of 8%. The Company  repaid  these loans in June 1994.  In  connection  with
these loans,  Viewpoint granted G.A. Norem I, L.P. a security interest on all of
its assets and issued to G.A. Norem I, L.P. warrants to purchase 4,536 shares of
Common Stock at $.10 per share.  G.A. Norem I, L.P.  exercised these warrants in
May 1994.

   In February  1994,  the Company issued 650,000 shares of Common Stock to each
of  Messrs.  Bernardi  and  Sterling,  the  Company's  founders,  for  aggregate
consideration of $130. In January 1995, Messrs.  Bernardi and Sterling each sold
back to the Company  127,940 shares of Common Stock for aggregate  consideration
of $25.58.

   In February 1994, the Company  entered into five-year  consulting  agreements
with  each  of SCG and  BCG,  each  of  which  agreements  provides  for  annual
compensation  of  $60,000,  subject  to  increases  and  annual  bonuses  at the
discretion of the Board of Directors,  and options to purchase  100,000  shares.
The SCG  agreement  also provided  that, at the sole  discretion of the Board of
Directors, the Company may pay a fee, not to exceed 6% of the transaction value,
in connection with any acquisition  transaction  consummated.  Mr.  Sterling,  a
principal  stockholder of the Company,  is the sole  stockholder of SCG, and Mr.
Bernardi, a principal stockholder of the Company, is the sole proprietor of BCG.
The consulting agreements also contain provisions granting Messrs.  Sterling and
Bernardi certain  piggyback and demand  registration  rights  exercisable at any
time during the term of the consulting agreement.  The consulting agreement with
BCG was voluntarily terminated by Mr. Bernardi effective March 15, 1995.

   
   In June 1996,  accrued but unpaid  consulting fees of $80,000 payable through
April 1996 to SCG pursuant to the consulting agreement were exchanged for Common
Stock of the Company at $3.00 per share.  In addition,  consulting fees due from
May 1996 through the date of this Prospectus were deferred by Mr. Sterling until
completion of this offering.  Pursuant to the consulting agreement, in July 1996
SCG was  issued a warrant  to  purchase  75,000  shares  of Common  Stock of the
Company exercisable at $3.00 per share.     

   In March 1994, the Company entered into an agreement with Catalyst.  Pursuant
to this  agreement,  the Company agreed to pay Catalyst a monthly fee of $10,000
for  Catalyst's  services in seeking  suitable  acquisition  candidates  for the
Company.  The  agreement  also  provides  for  a  fee  in  connection  with  any
transaction consummated pursuant to the agreement. The agreement was terminated,
with  respect to the monthly  fee,  on  September  30, 1994 and $11,692  remains
unpaid as of the date of this Prospectus.

   In May 1994, the Company acquired all of the outstanding stock and options of
Viewpoint  in  exchange  for  1,100,004  shares of Common  Stock and  options to
purchase Common Stock.  Mr. Norem was President and Chief  Executive  Officer of
Viewpoint at the time of the acquisition and exchanged his shares and options of
Viewpoint  for shares of Common  Stock and  options  of the  Company on the same
terms as the other  Viewpoint  security  holders.  Of the 198,758  option shares
received  by Mr.  Norem in May 1994,  68,758  were  returned  to the  Company in
October 1994 at the request of the Company's Board of Directors.

   In  July  and  October  1994,  the  Company  sold  certain  videoconferencing
equipment and software  enhancements to Network Imaging  Corporation ("NIC") for
$58,260.  Mr. Sterling is a former Chairman of NIC and Mr. Bernardi is currently
Chairman of NIC and formerly served as President and Chief Executive  Officer of
NIC.  Such  sales  were made on the same  terms and  conditions  and at the same
prices as sales  made to  disinterested  parties  during the period in which the
sales occurred.

                                       46

<PAGE>
   From September 1994 through  January 1995, in connection with the Convertible
Debt  Financing,  the  Company  issued to each of Mr.  Norem and Mrs.  Elizabeth
Sterling, the wife of Mr. Sterling, $50,000 principal amount of Convertible Debt
and to Messrs.  M. Douglas  Adkins,  Robert  Moody,  Jr., Fred Kassner and H. T.
Ardinger,  each a principal  stockholder  of the  Company,  $205,000,  $550,000,
$200,000 and $750,000  principal amount of Convertible Debt,  respectively.  All
issuances  were on the same terms and  conditions as the other  investors in the
Convertible Debt Financing. In addition, the Company issued to the Adkins Family
Partnership,  Ltd. $100,000 principal amount of Convertible Debt. Mr. Adkins and
Driftwood  Corporation,  of which  Mr.  Adkins  is  President,  are the  general
partners of the Adkins Family Partnership, Ltd.

   In January 1995, Messrs. Bernardi and Sterling each entered into a Memorandum
of Understanding with the Company in which each agreed to sell to the Company at
par 127,940 shares of the Company's  Common Stock as a condition  imposed by the
Company's prior  underwriter for its  participation in the initial filing of the
Company's  public  offering.  Messrs.  Sterling and  Bernardi  also agreed to an
increase in the exercise  price of options to purchase  100,000 shares of Common
Stock of the  Company  from  $.10  per  share to $2.20  per  share  for  similar
consideration.  Mr. Bernardi voluntarily  terminated his consulting agreement in
March 1995.

   
   In February  through April 1995,  in connection  with the issuance of Secured
Notes, the Company issued to Messrs. Norem, Moody, Adkins,  Ardinger,  Mrs. Mary
Ardinger,  wife of Mr.  Ardinger  and  G.A.  Norem  I,  L.P.,  each a  principal
stockholder of the Company $254,000,  $400,000,  $291,000,  $45,000, $45,000 and
$35,000 principal amount of Secured Notes,  respectively.  All issuances were on
the same terms and conditions as the other investors in the Secured Notes. As of
December 31, 1995, Messrs.  Moody, Adkins,  Ardinger and Mrs. Ardinger exchanged
their  respective  Secured  Notes for Common  Stock of the  Company at $3.00 per
share. As an incentive to exchange the Secured Notes for equity,  Messrs. Moody,
Adkins,  Ardinger and Mrs.  Ardinger were granted 200,000,  145,500,  22,500 and
22,500  warrants,  respectively,  to purchase  Company Common Stock at $1.00 per
share for three (3) years.  Mr. Norem received  85,500  Warrants to exchange his
Secured Notes for a Demand Note. Mr.  Norem's  Warrants are also priced at $1.00
per share for three (3) years.
    

   In June and July 1995,  in  connection  with the Demand  Notes,  the  Company
issued  to  Messrs.  Ardinger,  Adkins,  Mrs.  Ardinger  and Mr.  Norem,  each a
principal  stockholder of the Company,  $75,000,  $100,000,  $75,000 and $60,000
principal amount of Demand Notes,  respectively.  As an incentive to advance the
Demand Notes, Messrs. Ardinger, Adkins, Mrs. Ardinger and Mr. Norem were granted
18,750,  25,000, 18,750 and 15,000 warrants,  respectively,  to purchase Company
Common  Stock at $1.00 per share for three (3) years.  As of December  31, 1995,
Messrs.  Ardinger,  Adkins and Mrs.  Ardinger  exchanged their respective Demand
Notes for Common  Stock of the Company at $3.00 per share.  As an  incentive  to
exchange the Demand Notes for equity, Messrs. Ardinger, Adkins and Mrs. Ardinger
were  granted  37,500,  50,000 and 37,500  Warrants,  respectively,  to purchase
Company Common Stock at $1.00 per share for three (3) years.  Mr. Norem received
18,000 Warrants to purchase Company Common Stock as additional  compensation for
extending  his Demand Note.  Mr.  Norem's  Warrants are also priced at $1.00 per
share for three (3) years.

   
   In August 1995, the Company  authorized a private  placement for the issuance
and sale of up to  2,666,667  shares of the Common Stock of the Company at $3.00
per share (the "Regulation D Offering"). For its services as placement agent for
the  Regulation D Offering,  Network 1 Financial  Securities,  Inc.,  one of the
Representatives  in this offering,  received a commission in the amount of eight
percent  (8%) of the gross  proceeds of the  Regulation  D  Offering.  The gross
proceeds  of the  Regulation  D Offering  were  $5,425,755  and Network 1 earned
$395,000 in commissions on such proceeds.     

   In January and February  1996, in  connection  with the Secured Notes II, the
Company  issued to Mr. Fred  Kassner,  a principal  stockholder  of the Company,
$650,000  principal  amount of Secured  Notes II. As an incentive to advance the
Secured Notes II, Mr. Kassner was granted  warrants to purchase 65,000 shares of
Common Stock at $3.00 per share for three (3) years.  As of March 31, 1996,  Mr.
Kassner  converted  his Secured Notes II to Common Stock of the Company at $3.00
per share.

                                       47


<PAGE>
   In January 1996,  Messrs.  Norem,  Colquhoun and Leftwich received options to
purchase 160,000, 50,000 and 30,000 shares of Common Stock, respectively,  under
the 1995 Employee Stock Option Plan,  exercisable at $3.30,  $3.00 and $3.00 per
share, respectively, vesting over a five-year period subject to acceleration.

   In July 1996, the Company received gross proceeds of $1,000,000 in connection
with the  issuance  and  sale of  $1,000,000  aggregate  principal  amount  of a
convertible  note to Mr. Fred Kassner,  a principal  shareholder  of the Company
(the "Convertible  Debt II").  Pursuant to the terms of the Convertible Debt II,
Mr. Kassner received a warrant to purchase 100,000 shares of Common Stock of the
Company.  The  warrant  is  exercisable  at a price of $3.00 per share for three
years  from the date of  issuance.  In  addition,  should Mr.  Kassner  elect to
convert,  he will receive an additional  warrant to purchase  100,000  shares of
Common Stock at $3.00 per share for three years from the date of conversion.

   
   In  September  and October  1996,  the  Company  received  gross  proceeds of
$550,000  in  connection  with  the  issuance  and  sale of  $550,000  aggregate
principal  amount of Bridge  Debt to Mr.  Robert  Rubin,  a  shareholder  of the
Company.  Mr. Rubin received a warrant to purchase 55,000 shares of Common Stock
of the  Company  exercisable  at a price of $3.00 per share for three years from
the date of issuance pursuant to the terms of the Bridge Debt.

   In October  1996,  Glenn A. Norem,  Chief  Executive  Officer of the Company,
agreed to defer the receipt of $164,154  principal  amount of Secured and Demand
Notes,  accrued  interest of $41,154 and accrued  salary and bonuses of $127,781
until  December 1997. The Company has agreed to pay Mr. Norem interest at a rate
of 15% per annum on the deferred amount.  In addition,  Mr. Norem will be repaid
$200,000  principal  amount of Secured and Demand  Notes and  $50,000  principal
amount of Convertible  Debt plus accrued interest of $7,419 from the proceeds of
this offering.

   In  November  1996,  the  Company  received  gross  proceeds  of  $300,000 in
connection  with the  issuance  and  sale of an  additional  $300,000  aggregate
principal amount of Bridge Debt to Mr. M. Douglas Adkins and Mr. H.T.  Ardinger,
each  shareholders  of the  Company.  The  holders of the Bridge  Debt  received
warrants to purchase 30,000 shares of Common Stock of the Company exercisable at
a price of $3.00 share for ten years from the date of  issuance  pursuant to the
terms of the Bridge Debt.     

   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
unaffiliated third parties and will be approved by a majority of the independent
disinterested Directors of the Company.

                                       48

<PAGE>
                            DESCRIPTION OF SECURITIES

   The Company is authorized to issue 20,000,000 shares of Common Stock,  $.0001
par value per share and 5,000,000  shares of preferred  stock,  par value $.0001
per share.  As of the date of this  Prospectus,  the 5,054,314  shares of Common
Stock  outstanding are held by 70 holders of record,  and no shares of preferred
stock are outstanding.

COMMON STOCK

   The holders of Common  Stock are  entitled to one vote for each share held of
record on all  matters to be voted on by  stockholders.  There is no  cumulative
voting  with  respect to the  election  of  directors,  with the result that the
holders of more than 50% of the shares  voting for the election of directors can
elect all of the directors.  The current  shareholders of the Company (including
officers and  directors)  will  continue to own more than 75.4% (or more if they
purchase any of the shares  offered  hereby) of the shares of Common Stock after
the  offering  and,  accordingly,  may be able to  effectively  elect all of the
Company's  directors and control corporate  policy.  Holders of shares of Common
Stock are entitled to receive dividends when, as and if declared by the Board of
Directors in its discretion,  out of funds legally  available  therefor.  In the
event of liquidation,  dissolution or winding up of the Company,  the holders of
Common Stock are entitled to share ratably in the assets of the Company, if any,
legally   available  for  distribution  to  them  after  payment  of  debts  and
liabilities  of the Company and after  provision has been made for each class of
stock, if any, having liquidation  preference over the Common Stock.  Holders of
shares of Common  Stock have no  conversion,  preemptive  or other  subscription
rights, and there are no redemption or sinking fund provisions applicable to the
Common Stock. All of the outstanding  shares of Common Stock are, and the shares
of Common Stock  offered will be, when issued upon payment of the  consideration
set forth in this Prospectus, fully paid and non-assessable.

PREFERRED STOCK

   The Company is authorized to issue  preferred  stock with such  designations,
rights and  preferences  as may be determined  from time to time by the Board of
Directors. Accordingly, the Board of Directors is empowered, without stockholder
approval,  to issue  preferred  stock with  dividend,  liquidation,  conversion,
voting or other  rights which could  adversely  affect the voting power or other
rights of the holders of the Company's  Common Stock.  In the event of issuance,
the preferred stock could be utilized, under certain circumstances,  as a method
of discouraging,  delaying or preventing a change in control of the Company. The
Company has no present intention to issue any shares of its preferred stock.

WARRANTS

   The  following  is a  brief  summary  of  certain  provisions  of the  Public
Warrants,  but such  summary does not purport to be complete and is qualified in
all  respects by  reference  to the actual text of the  warrant  agreement  (the
"Warrant  Agreement") among the Company,  the  Representatives,  and Continental
Stock  Transfer  & Trust  Co.  (the  "Warrant  Agent").  A copy  of the  Warrant
Agreement  has been filed as an exhibit to the  Registration  Statement of which
this  Prospectus is a part. As of the date hereof,  there are no Public Warrants
outstanding. See "Additional Information."

   Exercise Price and Terms.  Each Public Warrant entitles the registered holder
thereof to purchase,  at any time over a fifty-four month period  commencing six
(6) months  after the date of this  Prospectus,  one share of Common  Stock at a
price of 120% of the  initial  public  offering  price  per  share,  subject  to
adjustment in accordance with the anti-dilution and other provisions referred to
below.  The holder of any Public  Warrant may  exercise  such Public  Warrant by
surrendering  the  certificate  representing  the Public  Warant to the  Warrant
Agent,  with the  subscription  form thereon  properly  completed  and executed,
together  with  payment  of the  exercise  price.  The  Public  Warrants  may be
exercised at any time in whole or in part at the applicable exercise price until
expiration of the Public Warrants.  No fractional shares will be issued upon the
exercise of the Public Warrants.

   The  exercise  price of the  Public  Warrants  bears no  relationship  to any
objective  criteria of value and should in no event be regarded as an indication
of any future market price of the securities offered hereby.

                                       49

<PAGE>
   Adjustments.  The  holders  of the  Public  Warrants  are  protected  against
dilution  of  their  interests  by  adjustments,  as set  forth  in the  Warrant
Agreement,  of the  exercise  price and the  number  of  shares of Common  Stock
purchasable  upon the exercise of the Public  Warrants  upon the  occurrence  of
certain  events,  including  stock  dividends,  stock  splits,  combinations  or
reclassification  of the Common  Stock,  or sale by the Company of shares of its
Common Stock or other securities  convertible into Common Stock at a price below
the  then-applicable  exercise price of the Public  Warrants.  Additionally,  an
adjustment would be made in the case of a reclassification or exchange of Common
Stock,  consolidation or merger of the Company with or into another  corporation
(other  than a  consolidation  or merger in which the  Company is the  surviving
corporation) or sale of all or substantially all of the assets of the Company in
order to enable warrantholders to acquire the kind and number of shares of stock
or other securities or property receivable in such event by holder of the number
of shares of Common  Stock that might  otherwise  have been  purchased  upon the
exercise of the Public Warrant.

   Redemption Provisions. Commencing eighteen (18) months after the date of this
Prospectus,  all,  but not less than all, of the Public  Warrants are subject to
redemption at $0.10 per Public  Warrant on not less than thirty (30) days' prior
written  notice to the  holders of the Public  Warrants  provided  the per share
closing  price or bid quotation of the Common Stock as reported on Nasdaq equals
or  exceeds $ [250% of the  initial  public  offering  price per  Share] for any
twenty (20) trading days within a period of thirty (30) consecutive trading days
ending on the fifth  trading  day prior to the date on which the  Company  gives
notice of redemption. The Public Warrants will be exercisable until the close of
business on the day immediately  preceding the date fixed for redemption in such
notice.  If any Public  Warrant  called for  redemption is not exercised by such
time,  it will cease to be  exercisable  and the holder will be entitled only to
the redemption price.

   Transfer,  Exchange and Exercise.  The Public Warrants are in registered form
and may be presented to the Warrant Agent for transfer,  exchange or exercise at
any time on or prior to their  expiration  date five (5) years  from the date of
this Prospectus,  at which time the Public Warrants become wholly void and of no
value.  If a market for the Public  Warrants  develops,  the holder may sell the
Public Warrants instead of exercising them. There can be no assurance,  however,
that a market for the Public Warrants will develop or continue.

   The Public Warrants are not exercisable  unless, at the time of the exercise,
the  Company  has a current  prospectus  covering  the  shares  of Common  Stock
issuable  upon  exercise  of the  Public  Warrants,  and such  shares  have been
registered,  qualified or deemed to be exempt under the  securities  laws of the
state of residence of the exercising holder of the Public Warrants. Although the
Company  will use its  best  efforts  to have all the  shares  of  Common  Stock
issuable  upon  exercise of the Public  Warrants  registered  or qualified on or
before the exercise date and to maintain a current  prospectus  relating thereto
until the expiration of the Public Warrants, there can be assurance that it will
be able to do so.

   The Public Warrants are separately  transferable  immediately  upon issuance.
Although  the  Public  Warrants  will not  knowingly  be sold to  purchasers  in
jurisdictions  in which the Public  Warrants  are not  registered  or  otherwise
qualified  for sale or  exemption,  purchasers  may buy Public  Warrants  in the
after-market in, or may move to,  jurisdictions in which Public Warrants and the
Common Stock  underlying the Public  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  Public  Warrants  (and the
Public  Warrants would not be exercisable by those persons) unless and until the
Public Warrants and the underlying Common Stock are registered, or qualified for
sale in  jurisdictions  in which such purchasers  reside,  or any exemption from
registration or qualification exists in such jurisdiction.

   Warrantholder  Not a  Stockholder.  The Public  Warrants  do not confer  upon
holders any voting, dividend or other rights as stockholders of the Company.

   Modification of Public  Warrants.  The Company and the Warrant Agent may make
such  modifications  to the Public Warrants as they deem necessary and desirable
that do not adversely  affect the interests of the  warrantholders.  The Company
may, in its sole discretion, lower the exercise price of the Public Warrants for
a period of not less than  thirty  (30) days on not less than  thirty (30) days'
prior written notice to the warrantholders and the Representative.  Modification
of the number of securites

                                       50

<PAGE>
purchasable upon the exercise of any Public Warrant,  the exercise price and the
expiration  date with  respect to any Public  Warrant  requires  the  consent of
two-thirds  of the  warrantholders.  No other  modifications  may be made to the
Public Warrants, without the consent of two-thirds of the warrantholders.

DELAWARE LAW WITH RESPECT TO BUSINESS COMBINATIONS

   As of the date of this  Prospectus,  the Company will be subject to the State
of  Delaware's  "business  combination"  statute,  Section  203 of the  Delaware
General  Corporation  Law. In general,  such statute  prohibits a publicly  held
Delaware corporation from engaging in a "business combination" with a person who
is an "interested stockholder" for a period of three years after the date of the
transaction  in which that person became an interested  stockholder,  unless the
business   combination  is  approved  in  a  prescribed   manner.   A  "business
combination"  includes a merger, asset sale or other transaction  resulting in a
financial benefit to the interested stockholder.  An "interested stockholder" is
a person who,  together with  affiliates,  owns (or, within three years prior to
the  proposed  business  combination,  did  own)  15% or  more  of the  Delaware
corporation's voting stock. The statute could prohibit or delay mergers or other
takeover  or change  in  control  attempts  with  respect  to the  Company  and,
accordingly, may discourage attempts to acquire the Company.

TRANSFER AGENT AND REGISTRAR

   The transfer  agent and registrar for the Common Stock is  Continental  Stock
Transfer and Trust Company, 2 Broadway, New York, New York 10004.

REPORTS TO STOCKHOLDERS

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

   As of the date of this  Prospectus,  the  Company has  registered  its Common
Stock and  Warrants  under the  provisions  of Section  12(g) of the  Securities
Exchange  Act of 1934,  as amended  (the  "Exchange  Act"),  and the Company has
agreed  that  it will  use  its  best  efforts  to  continue  to  maintain  such
registration for a minimum of five years from the date of this Prospectus.  Such
registration will require the Company to comply with periodic  reporting,  proxy
solicitation and certain other requirements of the Exchange Act.

                                       51


<PAGE>
                         SHARES ELIGIBLE FOR FUTURE SALE

   
   Upon the  consummation  of this  offering,  the Company  will have  7,331,558
shares of Common Stock  outstanding  (7,601,558  shares if the  Representatives'
over-allotment  option is exercised in full)(assuming no exercise of outstanding
options  and  warrants).  Of these  shares,  the  1,800,000  shares sold in this
offering  (2,070,000  shares if the  Representatives'  over-allotment  option is
exercised  in  full)  and  the  477,244   shares  of  Common  Stock   registered
concurrently with this Prospectus (the "Selling  Securityholders  Shares") being
offered  pursuant  to the  Selling  Securityholder  Prospectus  included  in the
Registration  Statement  of which  this  Prospectus  forms a part will be freely
tradeable subject to "lock-up"  agreements  described below under the Securities
Act,  except for any shares  purchased  by an  "affiliate"  of the  Company  (in
general, a person who has a control relationship with the Company), which shares
will be  subject  to the  resale  limitations  of Rule  144  adopted  under  the
Securities  Act. The  remaining  5,054,314  shares are deemed to be  "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 and are not currently part
of an  effective  registration.  Except for the  "lock-up"  agreement  described
below,  such  shares are  eligible  for sale under Rule 144,  or will  become so
eligible at various  times through  October  1996. In addition,  the Company has
granted  the  Representatives  demand and  piggyback  registration  rights  with
respect  to the  securities  issuable  upon  exercise  of  the  Representatives'
Warrants.  No  prediction  can be made as to the effect,  if any,  that sales of
shares of Common  Stock or even the  availability  of such  shares for sale will
have on the market  prices  prevailing  from time to time. If the holders of the
shares  eligible for  registration  so choose they could  require the Company to
register all of said shares at any time.     

   In  general,   under  Rule  144  as  currently  in  effect,  subject  to  the
satisfaction of certain other  conditions,  a person,  including an affiliate of
the  Company  (or other  persons  whose  shares are  aggregated),  who has owned
restricted  shares  of  Common  Stock  beneficially  for at least  two  years is
entitled to sell,  within any three-month  period,  a number of shares 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,  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  the  three  months
immediately  preceding the sale and who has beneficially  owned shares of Common
Stock for at least three  years is  entitled to sell such shares  under Rule 144
without regard to any of the limitations described above.

   Except upon the consent of both Representatives  during the first twelve (12)
months of the term of the lock-up period and thereafter  upon the consent of one
of the  Representatives,  all executive  officers,  all directors and holders of
substantially  all of the outstanding  stock of the Company and substantally all
holders of any options, warrants or other securities convertible, exercisable or
exchangeable  for  shares  of Common  Stock  have  agreed  not to,  directly  or
indirectly,  issue,  offer,  agree or offer to  sell,  sell,  transfer,  assign,
encumber,  grant an option for the purchase or sale of,  pledge,  hypothecate or
otherwise dispose of any beneficial  interest in such securities for a period of
twenty-four  (24)  months  following  the  effective  date  of the  Registration
Statement.  The Underwriters have agreed to release twenty-five percent (25%) of
the  securities  held by Mr. Robert  Bernardi on the three  hundred  sixty-sixth
(366th)  day after  the  effective  date of the  Registration  Statement  and an
additional  twenty five percent (25%) every ninety (90) days thereafter until no
securities held by Mr. Bernardi are subject to the lock-up agreement. Holders of
_____________of  the  "restricted  securities"  have not agreed not to sell such
shares,  all of which will be eligible for sale under,  and subject to, Rule 144
within three months following the date of this  Prospectus.  For a period of two
years from the date of this Prospectus,  the Company has also agreed not to file
any  registration  statement  relating to the offering or sale of the  Company's
securities  (not including any  registration  statement on Form S-8) without the
consent of the Representatives.

   Prior to this offering,  there has been no market for the Common Stock and no
prediction can be made as to the effect,  if any, that market sales of shares of
Common Stock or the availability of such shares for sale will have on the market
prices  prevailing  from  time  to  time.  Nevertheless,  the  possibility  that
substantial  amounts  of  Common  Stock  may be sold in the  public  market  may
adversely affect  prevailing market prices for the Common Stock and could impair
the  Company's  ability  to  raise  capital  through  the  sale  of  its  equity
securities.

                                       52


<PAGE>
                                 UNDERWRITING

   The  Underwriters  named  below  (the  "Underwriters"),   for  whom  National
Securities  Corporation and Network 1 Financial  Securities,  Inc. are acting as
representatives  (in  such  capacity,  the  "Representatives"),  have  severally
agreed,  subject to the terms and conditions of the Underwriting  Agreement (the
"Underwriting  Agreement")  to  purchase  from the  Company  and the Company has
agreed to sell to the  Underwriters on a firm commitment  basis,  the respective
number of Securities set forth opposite their names:

                                                           NUMBER OF 
                      UNDERWRITER                          SECURITIES
          ------------------------------------------       --------- 
          National Securities Corporation...........                 
          Network 1 Financial Securities,Inc .......                 
                                                           --------- 
            Total .................................       1,800,000 
                                                           ========= 

   The Underwriters are committed to purchase all the shares of Common Stock and
Public  Warrants  offered hereby,  if any of such securities are purchased.  The
Underwriting Agreement provides that the obligations of the several Underwriters
are subject to conditions precedent specified therein.

   The Company has been  advised by the  Representatives  that the  Underwriters
propose  initially to offer the  Securities to the public at the initial  public
offering  prices set forth on the cover page of this  Prospectus  and to certain
dealers at such  prices  less  concessions  not in excess of $____ per share and
$____ per Public Warrant. Such dealers may reallow a concession not in excess of
$____ per share and $____ per Public Warrant to certain other dealers. After the
commencement  of the  offering,  the  public  offering  prices,  concession  and
reallowance may be changed by the Representatives.

   The  Representatives  have informed the Company that they do not expect sales
to  discretionary  accounts by the  Underwriters  to exceed five  percent of the
securities offered hereby.

   The  Company  has  agreed  to  indemnify  the  Underwriters  against  certain
liabilities, including liabilities under the Securities Act, or to contribute to
payments  that the  Underwriters  may be required to make.  The Company has also
agreed to pay to the  Representatives a non-accountable  expense allowance equal
to  3%  of  the  gross  proceeds   derived  from  the  sale  of  the  Securities
underwritten, of which $25,000 has been paid to date.

   The  Company  has  granted  to the  Underwriters  an  over-allotment  option,
exercisable  during  the  forty-five  (45)  day  period  from  the  date of this
Prospectus,  to  purchase up to an  additional  270,000  shares of Common  Stock
and/or  270,000 Public  Warrants at the initial public  offering price per share
and Public Warrant,  respectively,  offered hereby, less underwriting  discounts
and the non-accountable expense allowance. Such option may be exercised only for
the purpose of  covering  over-allotments,  if any,  incurred in the sale of the
securities offered hereby. To the extent such option is exercised in whole or in
part,  each  Underwriter  will  have  a  firm  commitment,  subject  to  certain
conditions, to purchase the number of the additional securities proportionate to
its initial commitment.

   In  connection  with this  offering,  the  Company  has agreed to sell to the
Representatives,  for  nominal  consideration,  warrants  to  purchase  from the
Company up to 180,000 shares of Common Stock and/or 180,000 Public Warrants (the
"Representatives'   Warrants").  The  Representatives'  Warrants  are  initially
exercisable  at a price of $___ per share of Common  Stock  [120% of the initial
public  offering  price per Share] and $_______ per Public  Warrant [120% of the
initial  public  offering  price per  Public  Warrant]  for a period of four (4)
years,  commencing at the beginning of the second year after their  issuance and
sale.  The  Representatives'   Warrants  are  restricted  from  sale,  transfer,
assignment  or  hypothecation  for a period of twelve  (12) months from the date
hereof, except to officers of the Representatives. The Representatives' Warrants
provide for adjustment in the number of shares of Common Stock and Public

                                       53
<PAGE>
Warrants  issuable  upon the exercise  thereof and in the exercise  price of the
Representatives'  Warrants as a result of certain events, including subdivisions
and combinations of the Common Stock. The Representatives' Warrants grant to the
holders thereof certain rights of registration for the securities  issuable upon
exercise thereof.

   
   Except upon the consent of both Representatives  during the first twelve (12)
months of the term of the lock-up period and thereafter  upon the consent of one
of the  Representatives,  all executive  officers,  all directors and holders of
substantially  all of the outstanding stock of the Company and substantially all
holders of any options, warrants or other securities convertible, exercisable or
exchangeable  for  shares  of Common  Stock  have  agreed  not to,  directly  or
indirectly,  issue,  offer,  agree or offer to  sell,  sell,  transfer,  assign,
encumber,  grant an option for the purchase or sale of,  pledge,  hypothecate or
otherwise dispose of any beneficial  interest in such securities for a period of
twenty-four  (24)  months  following  the  effective  date  of the  Registration
Statement.  An  appropriate  legend shall be marked on the face of  certificates
representing  all such  securities.  In  addition,  without  the consent of both
Representatives  and except  pursuant to the exercise of the Public Warrants and
the Representatives'  Warrants, the Company has agreed that it, its subsidiaries
and  affiliates  shall  not  sell or offer  for  sale  any of  their  securities
commencing  the  effective  date of the  Registration  Statement  of which  this
Prospectus  is a part for a period  of twelve  (12)  months  thereafter,  except
pursuant to (i) options  outstanding  or available for grant under the Company's
option plans  existing on the date hereof (and subject to their  issuance at the
greater of fair market value and the initial public  offering price per share of
Common  Stock on the date of grant) and (ii) the ESPP.  The  Company has further
agreed for a period of twenty-four  (24) months  following the effective date of
the  Registration  Statement of which this  Prospectus is a part,  not to file a
registration  statement covering any of its securities without the prior written
consent of National Securities Corporation,  except (i) a registration statement
covering a maximum of 477,244  shares and  warrants to  purchase  an  additional
477,244  shares and (ii) a  registration  statement  on Form S-8 relating to the
Company's stock option plans described in the Registration  Statement;  provided
in each of the  foregoing  cases,  all such  securityholders  deliver  a lock-up
agreement to National as described above.     

   The Company has agreed that National Securities  Corporation may nominate for
election one person to the Company's  Board of Directors  (which person shall be
reasonably  acceptable  to the Company) for a period of three (3) years from the
effective date of the  Registration  Statement and that certain of the Company's
officers,  directors and stockholders have agreed to vote their shares of common
stock in favor of such designee.  In the event National  Securities  Corporation
elects not to exercise  the right,  then  National  Securities  Corporation  may
designate one person to attend meetings of the Company's Board of Directors as a
non-voting advisor (which person shall be reasonably acceptable to the Company).
Such  designee  shall be entitled to attend all such  meetings of the  Company's
Board of  Directors  and to receive  all notices  and other  correspondence  and
communications  sent by the  Company to members of its Board of  Directors.  The
Company has agreed to reimburse designees of National Securities Corporation for
their  out-of-pocket  expenses  incurred in connection with their  attendance of
meetings of the Company's Board of Directors.

   Prior to this offering,  there has been no public market for the Common Stock
or the Public Warrants.  Consequently, the initial public offering prices of the
securities  has been  determined  by  negotiation  between  the  Company and the
Representatives  and does not necessarily bear any relationship to the Company's
asset  value,  net worth or other  established  criteria  of value.  The factors
considered in such  negotiations,  in addition to prevailing market  conditions,
included  the  history of and  prospects  for the  industry in which the Company
competes,  an  assessment  of the  Company's  management,  the  prospects of the
Company,  its capital  structure,  the market for initial  public  offerings and
certain other factors as were deemed relevant.

   Upon the exercise of any Public Warrants more than one year after the date of
this Prospectus,  which exercise was solicited by a  Representative,  and to the
extent  not  inconsistent  with the  guidelines  of the NASD and the  Rules  and
Regulations of the Commission, the Company has agreed to pay such Representative
a commission which shall not exceed five percent (5%) of the aggregate  exercise
price of such Public Warrants in connection with bona fide services  provided by
such  Representative  relating to any warrant  solicitation  undertaken  by such
Representative. In addition, the individual must designate

                                       54


<PAGE>
the firm  entitled to payment of such  warrant  solicitation  fee.  However,  no
compensation will be paid to the  Representative in connection with the exercise
of the Public Warrants if (a) the market price of the Common Stock is lower than
the  exercise  price,  (b) the  Public  Warrants  were  held in a  discretionary
account,  or (c) the  exercise of the Public  Warrants is not  solicited  by the
Representative.  Unless  granted an  exemption by the  Commission  from its Rule
10b-6 under the  Exchange  Act,  the  Representatives  will be  prohibited  from
engaging in any market-making activities with regard to the Company's securities
for the period from nine (9) business days (or other such applicable  periods as
Rule 10b-6 may provide) prior to any  solicitation of the exercise of the Public
Warrants until the later of the termination of such solicitation activity or the
termination (by waiver or otherwise) of any right the  Representatives  may have
to receive a fee. As a result, the  Representatives may be unable to continue to
provide a market for the Common Stock or Public  Warrants during certain periods
while the Public Warrants are exercisable.  If a  Representative  has engaged in
any of the  activities  prohibited  by Rule 10b-6  during the periods  described
above, such  Representative  undertakes to waive  unconditionally  its rights to
receive a commission on the exercise of such Public Warrants.

   
   The foregoing is a summary of the principal terms of the agreements described
above and does not purport to be  complete.  Reference is made to a copy of each
such agreement which are filed as exhibits to the  Registration  Statement.  See
"Additional Information."
    


                                       55
<PAGE>

                      CONCURRENT REGISTRATION OF SECURITIES

   
   Concurrently with this offering, 477,244 shares of Common Stock (the "Selling
Securityholders' Shares") 477,244 Public Warrants (the "Selling Securityholders'
Warrants") and 477,244 shares underlying the Selling  Securityholders'  Warrants
have  been  registered  by the  Company  under the  Securities  Act on behalf of
certain of its securityholders  (the "Selling  Securityholders"),  pursuant to a
Selling  Securityholders'  Prospectus included within the Registration Statement
of which this Prospectus forms a part. The Selling  Securityholders' Shares, the
Selling  Securityholders   Warrants,  and  the  shares  underlying  the  Selling
Securityholders  Warrants are not part of this underwritten  offering and all of
these  shares and  warrants  may not be sold prior to 24 months from the date of
this  Prospectus,  in each  case,  without  the  prior  written  consent  of the
Representatives.  The Company will not receive any of the proceeds from the sale
of the Selling Securityholders'  Shares, the Selling Securityholders'  Warrants,
or the shares underlying the Selling Securityholders' Warrants, but will receive
proceeds from the exercise of the Selling Securityholders' Warrants.     

                      INTEREST OF NAMED EXPERTS AND COUNSEL

   John S. Stoppelman,  a principal of The Stoppelman Law Firm, P.C., counsel to
the Company owns 42,666 shares of Common Stock of the Company,  or less than one
percent (1.0%) of the shares outstanding before this offering.

                                  LEGAL MATTERS

   The  legality of the  securities  offered  hereby will be passed upon for the
Company by The Stoppelman Law Firm, P.C., McLean, Virginia. Orrick, Herrington &
Sutcliffe  L.L.P.,  New York,  NY has acted as special  counsel to  National  in
connection with this offering. Gersten, Savage, Kaplowitz, & Curtin, L.L.P., New
York, NY has acted as counsel for the several  underwriters  in connection  with
this offering.

                                   EXPERTS

   The  consolidated  financial  statements of the Company and its  subsidiaries
(companies in the development stage) at December 31, 1995 and for the year ended
December 31, 1995, appearing in this Prospectus and Registration  Statement have
been audited by Ernst & Young LLP, independent  auditors,  as set forth in their
report thereon  appearing  elsewhere  herein,  and are included in reliance upon
such report given upon the authority of such firm as experts in  accounting  and
auditing.

   The  consolidated  financial  statements of the Company and its  subsidiaries
(companies in the development stage) at December 31, 1994 and for the year ended
December 31, 1994, appearing in this Prospectus and Registration  Statement have
been audited by Hoffman,  Morrison & Fitzgerald,  P.C. ("Hoffman"),  independent
auditors,  as set forth in their report thereon appearing  elsewhere herein, and
are included in reliance  upon such report given upon the authority of such firm
as experts in accounting and auditing.

   The  former  independent  auditor  for  the  Company,   Hoffman,  Morrison  &
Fitzgerald,  P.C.,  was dismissed by the Company on November 3, 1995.  Hoffman's
report on the financial  statements  for the fiscal year ended December 31, 1994
did not contain an adverse opinion or disclaimer of opinion,  and, except for an
emphasis paragraph  describing  substantial doubt about the Company's ability to
continue as a going concern, was not modified as to uncertainty,  audit scope or
accounting principles. Management is not aware of any disagreements with Hoffman
on any  matter  of  accounting  principles  or  practices,  financial  statement
disclosure or auditing scope or procedure through the date of dismissal,  which,
if not resolved to  Hoffman's  satisfaction,  would have caused  Hoffman to make
reference  to the subject  matter of the  disagreement  in  connection  with its
report.

                                       56

<PAGE>
                             ADDITIONAL INFORMATION

   The Company has filed with the  Commission a  registration  statement on Form
SB-2 (the "Registration Statement") under the Securities Act with respect to the
Common Stock and Public  Warrants  offered by this  Prospectus.  This Prospectus
does not contain all of the information set forth in the Registration Statement,
certain parts of which are omitted in accordance  with the rules and regulations
of the Commission.  For further information with respect to the Company and this
offering,  reference  is  made  to the  Registration  Statement,  including  the
exhibits  filed  therewith,  which  may  be  inspected  without  charge  at  the
Commission's principal office at 450 Fifth Street, N.W., Washington, D.C. 20549;
at the New York Regional Office, 7 World Trade Center,  New York, New York 10048
and at the Midwest  Regional Office,  Citicorp Center,  500 West Madison Street,
Suite 1400, Chicago, Illinois 60661. Copies of the Registration Statement may be
obtained from the  Commission at its principal  office and regional  office upon
payment of  prescribed  fees and over the  Internet at  www.sec.gov.  Statements
contained  in this  Prospectus  as to the  contents  of any  contract  or  other
document are not necessarily  complete and, where the contract or other document
has been filed as an exhibit to the  Registration  Statement,  each statement is
qualified in all respects by reference to the applicable document filed with the
Commission.

                                       57

<PAGE>


                                    GLOSSARY

Algorithm:                   A  step-by-step  problem  solving  or  mathematical
                             procedure.

Asynchronous:                That which takes place in different time frames and
                             is accessed at the user's convenience.

Bandwidth:                   The amount of  information  that can be transmitted
                             across an information channel.

Frame  Relay:                Packet data protocol with less error  correction to
                             speed   up   communication    over   high   quality
                             connections.

Intranet:                   A private Internet.

Internet:                   A  network  of  computer   networks   using  TCP/IP
                             protocol.

ISDN:                       (Integrated  Services  Digital  Network) -- digital
                             network that  provides  seamless  communication  of
                             voice, video and text.

Kilobits:                    A  thousand  bits;  a  measure  of the rate of data
                             transmission.

LAN:                         (Local Area Network) -- a private  computer network
                             connecting computers in the same building or campus
                             using  coaxial  cable,  twisted  pair or  multimode
                             fiber.

MBONE:                       A portion of the Internet with multimedia broadcast
                             capability.

Multimedia:                  A  combination  of multiple  digitized  data types:
                             text,   sound,   computer-generated   graphics  and
                             animations, photographs and video.

NTSC:                        The standard for scanning television signals in the
                             US, Canada and Japan.

Packet:                      A  grouping  of  data,  typically  from  one to 512
                             characters in size,  which usually  represents  one
                             transaction.

PCI-Bus:                     A fast 32 bit  peripheral  interface  for  PC's and
                             workstations.

Protocol:                    A set of rules  for data  communications;  a set of
                             rules   and   procedures   for   establishing   and
                             controlling the exchange of data between computers.

S-Bus:                       A proprietary high speed  peripheral  interface for
                             Sun workstations.

Standards-based              A  product   which  is   designed  to  comply  with
                             standards  promulgated  by  a  recognized  industry
                             organization.

Switched Architecture:       Any network or device in which switching is present
                             and is used to direct  messages  from the sender to
                             the ultimate recipient.

TCP/IP:                      (Transmission Control  Protocol/Internet  Protocol)
                             --  the   protocol   used   for   packet   oriented
                             communication between networked computers.

UTP:                         (Unshielded  Twisted  Pair)  --  standard  building
                             wiring currently used to transmit voice (telephone)
                             and data throughout an office or building.

WAN:                         (Wide Area  Network) -- a voice,  data and/or video
                             network  covering a  geographic  area larger than a
                             campus,    generally   linking   multiple   smaller
                             networks.

Whiteboard:                  A shared drawing or graphics  session or capability
                             between two remote computers.

World Wide  Web:             A very large  collection of linked Internet servers
                             using a standard linking and display language.

                                        i

<PAGE>
                 MULTIMEDIA ACCESS CORPORATION AND SUBSIDIARIES
                          (A Development Stage Company)
                   INDEX TO CONSOLIDATED FINANCIAL STATEMENTS

<TABLE>
<CAPTION>
<S>                                                                                            <C>
Reports of Independent Auditors .............................................................  F-2
Consolidated Balance Sheets at December 31, 1994 and 1995 and September 30, 1996
(Unaudited)..................................................................................  F-4
Consolidated Statements of Operations for the years ended December 31, 1994 and 1995, the
nine months ended September 30, 1995 and 1996 (Unaudited) and Cumulative from Inception
(November 19, 1992) to September 30, 1996 (Unaudited)........................................  F-5
Consolidated Statements of Stockholders' Equity (Deficit) from Inception (November 19, 1992)
to December 31, 1995 and the nine months ended September 30, 1996 (Unaudited) ...............  F-6
Consolidated Statements of Cash Flows for the years ended December 31, 1994 and 1995, the
nine months ended September 30, 1995 and 1996 (Unaudited) and Cumulative from Inception
(November 19, 1992) to September 30, 1996 (Unaudited)........................................  F-8
Notes to Consolidated Financial Statements...................................................  F-9

</TABLE>

                                       F-1

<PAGE>
                         REPORT OF INDEPENDENT AUDITORS

The Board of Directors
MultiMedia Access Corporation

We have audited the accompanying consolidated balance sheet of MultiMedia Access
Corporation and  subsidiaries  (a development  stage company) as of December 31,
1995,  and the related  consolidated  statements  of  operations,  stockholders'
equity  (deficit)  and cash  flows  for the year  then  ended.  These  financial
statements   are  the   responsibility   of  the   Company's   management.   Our
responsibility  is to express an opinion on these financial  statements based on
our audit.

We conducted our audit 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 audit provides a reasonable basis for our opinion.

In our opinion, the consolidated  financial statements referred to above present
fairly,  in all  material  respects,  the  consolidated  financial  position  of
MultiMedia  Access  Corporation  and  subsidiaries at December 31, 1995, and the
consolidated  results  of its  operations  and its cash  flows for the year then
ended in conformity with generally accepted accounting principles.

The accompanying  consolidated  financial statements have been prepared assuming
that the  Company  will  continue  as a going  concern  which  contemplates  the
realization  of assets and  liquidation  of  liabilities in the normal course of
business.  As more fully  described in Note 1, the Company is dependent upon the
proceeds  from  an  initial  public  offering  of  its  common  stock  or  other
alternative  financing,  has incurred recurring losses from operations and has a
substantial working capital deficiency. These conditions raise substantial doubt
about the Company's  ability to continue as a going  concern.  The  consolidated
financial  statements  do not include any  adjustments  to reflect the  possible
future effects on the recoverability and classification of assets or the amounts
and  classification  of  liabilities  that may result  from the  outcome of this
uncertainty.

   
Dallas, Texas                                                  ERNST & YOUNG LLP
April 5, 1996
    

                                       F-2

<PAGE>
                          INDEPENDENT AUDITORS' REPORT

The Board of Directors
MultiMedia Access Corporation and Subsidiaries
Dallas, TX

We have  audited the  accompanying  consolidated  balance  sheets of  MultiMedia
Access Corporation and Subsidiaries (a development stage company) as of December
31, 1994, and the related consolidated  statements of operations,  stockholders'
equity  (deficit)  and cash  flows  for the year  then  ended.  These  financial
statements   are  the   responsibility   of  the   Company's   management.   Our
responsibility is to express an opinion on these  consolidated  statements based
on our audits.

We conducted our audit in accordance with generally accepted auditing standards.
Those standards  require that we plan and perform the audit to obtain reasonable
assurance  about  whether  the  consolidated  financial  statements  are free of
material  misstatement.  An audit includes examining,  on a test basis, evidence
supporting the amounts and disclosures in the consolidated 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 audit provides a reasonable  basis
for our opinion.

In our opinion, the consolidated  financial statements referred to above present
fairly, in all material  respects,  the financial  position of MultiMedia Access
Corporation  and  Subsidiaries  as of December 31, 1994,  and the results of its
operations  and its cash  flows  for the year then  ended,  in  conformity  with
generally accepted accounting principles.

The accompanying  consolidated  financial statements have been prepared assuming
that the  Company  will  continue  as a going  concern  which  contemplates  the
realization  of assets and  liquidation  of  liabilities in the normal course of
business.  As more fully  described in Note 1, the Company is dependent upon the
proceeds  from  an  initial  public  offering  of  its  common  stock  or  other
alternative  financing,  has incurred recurring losses from operations and has a
substantial working capital deficiency. These conditions raise substantial doubt
about the Company's  ability to continue as a going  concern.  The  consolidated
financial  statements  do not include any  adjustments  to reflect the  possible
future effects on the recoverability and classification of assets or the amounts
and  classification  of  liabilities  that may result  from the  outcome of this
uncertainty.

                                               HOFFMAN, DYKES & FITZGERALD, P.C.

March 17, 1995, except for Note 12, 
which is as of May 8, 1995
Vienna, Virginia

                                       F-3


<PAGE>
                 MULTIMEDIA ACCESS CORPORATION AND SUBSIDIARIES
                          (A DEVELOPMENT STAGE COMPANY)
                           CONSOLIDATED BALANCE SHEETS

<TABLE>
<CAPTION>
                                                                            DECEMBER 31,         SEPTEMBER 30,
                                                                    ---------------------------      1996
                                                                         1994          1995
                                                                    ------------- -------------  ------------
                              ASSETS                                                              (UNAUDITED)
<S>                                                                 <C>           <C>           <C>
Current assets:
 Cash and cash equivalents........................................  $    31,360   $    16,605   $     21,523
 Accounts receivable, less allowance for doubtful accounts (none
  at December 31, 1994, $29,647 and $44,196 at December 31, 1995
  and September 30, 1996 (unaudited), respectively)...............       36,581         4,564        128,755
 Inventory, less reserve (none at December 31, 1994, $220,000 at
  December 31, 1995 and $215,000 at September 30, 1996
  (unaudited)....................................................       365,103       197,469        377,313
 Prepaid expenses.................................................       36,331        18,971         70,267
 Due from debt holder.............................................           --       315,300             --
 Deferred charges.................................................      307,115        44,165        324,593
                                                                    ------------- ------------- --------------
   Total current assets...........................................      776,490       597,074        922,451

Property and equipment, net.......................................      534,031       485,700        481,851
Software development costs, net...................................      210,256       143,795        116,689
Deferred charges, net.............................................      151,772            --         20,833
Deposits..........................................................       17,829        18,197         18,272
Patent, net.......................................................       90,677            --             --
                                                                    ------------- ------------- --------------
   Total assets...................................................  $ 1,781,055   $ 1,244,766   $  1,560,096
                                                                    ============= ============= ==============
          LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT)
Current liabilities:
 Accounts payable.................................................  $   432,623   $   580,160   $    523,347
 Accrued compensation.............................................      253,755       354,268        230,048
 Deferred revenue.................................................       17,471        75,513         27,091
 Other accrued liabilities........................................      273,513       370,398        777,299
 Short-term debt, officer.........................................           --       364,154        364,154
 Short-term debt, other...........................................        8,271        66,633      1,003,554
 Current portion of long-term debt................................           --     2,677,550      2,677,550
                                                                    ------------- ------------- --------------
   Total current liabilities......................................      985,633     4,488,676      5,603,043
Long-term debt....................................................    2,195,174         8,654        500,000

Commitments and contingencies

Stockholders' equity (deficit):
 Preferred stock, $.0001 par value:
  Authorized shares - 5,000,000
  Issued shares - none............................................           --            --             --
 Common stock, $.0001 par value:
  Authorized shares - 20,000,000
  Issued and outstanding  shares - 3,507,231 at December 31, 1994, 
  4,721,268 at December 31, 1995 and 5,315,811 at September 30,
  1996 (unaudited)................................................          350           472            532
 Additional paid-in capital.......................................    1,163,274     4,736,933      6,527,572
 Stock subscription receivable....................................         (191)              --           --
 Deficit accumulated during the development stage.................   (2,563,185)   (7,978,063)   (11,059,145)
 Treasury stock, 261,497 shares at December 31, 1995 and September
  30, 1996 (unaudited)............................................           --       (11,906)       (11,906)
                                                                    ------------- ------------- --------------
   Total stockholders' equity (deficit)...........................   (1,399,752)   (3,252,564)    (4,542,947)
                                                                    ------------- ------------- --------------
   Total liabilities and stockholders' equity (deficit)...........  $ 1,781,055   $ 1,244,766   $  1,560,096
                                                                    ============= ============= ==============
</TABLE>

                           See accompanying notes.

                               F-4


<PAGE>
                MULTIMEDIA ACCESS CORPORATION AND SUBSIDIARIES
                        (A DEVELOPMENT STAGE COMPANY)
                    CONSOLIDATED STATEMENTS OF OPERATIONS

<TABLE>
<CAPTION>
                                                                                                      CUMULATIVE
                                                                        FOR THE NINE MONTHS              FROM
                                        YEAR ENDED DECEMBER 31,         ENDED SEPTEMBER 30,            INCEPTION
                                     ----------------------------- -----------------------------  (NOVEMBER 19, 1992)
                                          1994           1995           1995           1996      TO SEPTEMBER 30, 1996
                                     -------------- -------------- -------------- -------------- ---------------------
                                                                     (UNAUDITED)    (UNAUDITED)       (UNAUDITED)
<S>                                  <C>            <C>            <C>            <C>            <C>
Net sales..........................  $   127,531    $   285,354    $   244,223    $   900,446    $  1,377,407
Cost of goods sold.................       64,363        136,381        112,452        315,437         547,994
                                     -------------- -------------- -------------- -------------- --------------------
Gross profit.......................       63,168        148,973        131,771        585,009         829,413
Operating expenses:
 Selling, general and
  administrative...................    1,795,485      2,297,497      1,737,201      1,712,494       6,320,012
 Research and development..........      864,847      1,983,310      1,149,333      1,457,001       4,427,001
 Depreciation and amortization.....       80,360        439,752        185,789        153,035         704,172
                                     -------------- -------------- -------------- -------------- --------------------
  Total operating expenses.........    2,740,692      4,720,559      3,072,323      3,322,530      11,451,185
                                     -------------- -------------- -------------- -------------- --------------------
Operating loss.....................   (2,677,524)    (4,571,586)    (2,940,552)    (2,727,521)    (10,621,772)
Other income (expense):
 Dividend and interest income......       29,215          5,372          1,842             69          34,656
 Interest expense..................      (81,503)      (847,905)      (570,470)      (343,630)     (1,286,027)
 Other.............................       12,391           (759)          (330)            --          11,632
                                     -------------- -------------- -------------- -------------- --------------------
  Total other income (expense).....      (39,897)      (843,292)      (568,958)      (343,561)     (1,239,739)
                                     -------------- -------------- -------------- -------------- --------------------
Net loss...........................  $(2,717,421)   $(5,414,878)   $(3,509,510)   $(3,081,082)   $(11,861,511)
                                     ============== ============== ============== ============== ====================
Net loss per share.................  $     (0.53)   $     (0.98)   $     (0.64)   $     (0.49)
                                     ============== ============== ============== ==============
Weighted average number of common
 and common equivalent shares
 outstanding.......................    5,157,932      5,542,184      5,480,438      6,283,167
                                     ============== ============== ============== ==============
</TABLE>

                           See accompanying notes.

                               F-5

<PAGE>
   
                MULTIMEDIA ACCESS CORPORATION AND SUBSIDIARIES
                        (A DEVELOPMENT STAGE COMPANY)

          CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY (DEFICIT)
           FROM INCEPTION (NOVEMBER 19, 1992) TO DECEMBER 31, 1995
           AND THE NINE MONTHS ENDED SEPTEMBER 30, 1996 (UNAUDITED)
    

<TABLE>
<CAPTION>
                                                                                ACCUMULATED   ACCUMULATED
                                 COMMON STOCK         ADDITIONAL     STOCK         DEFICIT       DEFICIT                  TOTAL
                              -------------------      PAID-IN    SUBSCRIPTIONS     AS AN S       AS A C     TREASURY  STOCKHOLDERS'
                              SHARES    PAR VALUE      CAPITAL     RECEIVABLE    CORPORATION   CORPORATION     STOCK    (DEFICIT)
                              ------    ---------      -------     ----------    -----------   -----------     -----    ---------
 <S>                        <C>         <C>            <C>       <C>            <C>            <C>            <C>      <C>
Net loss from inception
 (November 19, 1992) to
 December 31, 1992........        --    $    --        $    --   $       --      $ (53,925)    $      --      $   --    $   (53,925)
                           ----------- ----------- ------------ --------------- ------------- ------------- ----------
   ----------------
Balance, December 31,
 1992                             --         --             --           --        (53,925)           --          --        (53,925)
Exercise of options......    194,180         19            361         (342)            --            --          --             38
Exercise of warrants ....    511,000         51            949         (900)            --            --          --            100
Net loss.................         --         --             --           --       (594,205)           --          --       (594,205)
                           ----------- ----------- ------------ --------------- ------------- ------------- ----------  ------------
Balance, December 31,
 1993                        705,180         70          1,310       (1,242)       648,130)           --          --       (647,992)
Sale of common stock,
 February 1994............ 1,510,000        151             --           --             --            --          --            151
Sale of common stock,
 March 1994...............   996,364        100      1,917,141           --             --            --          --      1,917,241
Exercise of options......     25,126          2            535           --             --            --          --            537
Net loss as an S
 Corporation January 1,
 1994 to May 10, 1994 ....        --         --             --           --       (154,236)           --          --       (154,236)
Reclassification of S
 Corporation losses upon
 merger with Viewpoint ...        --         --      (802,366)           --        802,366            --          --             --
Common stock issued,
 June 1994................    10,000          1        21,999            --             --            --          --         22,000
Exercise of warrants ....    107,261         11        21,670          (844)            --            --          --         20,837
Exercise of options......    153,300         15         2,985            --             --            --          --          3,000
Payment of stock
 subscriptions............        --         --            --         1,895             --            --          --          1,895
Net loss.................         --         --            --            --             --      (2,563,185)       --     (2,563,185)
                           ----------- ----------- ------------ --------------- ------------- ------------- ----------  ------------
Balance, December 31,
 1994                      3,507,231        350     1,163,274          (191)            --      (2,563,185)       --     (1,399,752)
</TABLE>

                                       F-6


<PAGE>
   
                MULTIMEDIA ACCESS CORPORATION AND SUBSIDIARIES
                        (A DEVELOPMENT STAGE COMPANY)
    CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY (DEFICIT) (CONTINUED)
           FROM INCEPTION (NOVEMBER 19, 1992) TO DECEMBER 31, 1995
           AND THE NINE MONTHS ENDED SEPTEMBER 30, 1996 (UNAUDITED)

<TABLE>
<CAPTION>

                                                                                ACCUMULATED   ACCUMULATED
                                 COMMON STOCK         ADDITIONAL     STOCK         DEFICIT       DEFICIT                  TOTAL
                              -------------------      PAID-IN    SUBSCRIPTIONS     AS AN S       AS A C     TREASURY  STOCKHOLDERS'
                              SHARES    PAR VALUE      CAPITAL     RECEIVABLE    CORPORATION   CORPORATION     STOCK     (DEFICIT)
                              ------    ---------      -------     ----------    -----------   -----------     -----     ---------
 <S>                       <C>         <C>         <C>            <C>           <C>           <C>             <C>      <C>
Balance, December 31,
 1994                    3,507,231    $     350     $1,163,274    $ (191)       $--           $ (2,563,185)   $   --   $ (1,399,752)
Payment of stock 
 subscriptions .....         --              --        --            191         --              --               --            191
Repurchase of 255,880
 shares of common stock
 at par ............         --              --        --             --         --              --              (26)           (26)
Sale of common stock,
 net of expenses,
 September 1995 ....      833,333            83      2,166,811        --         --              --               --      2,166,894
Satisfaction of trade
 receivable for 5,617
 shares of common stock .    --              --        --             --         --              --          (11,880)       (11,880)
Exchange of short-term
 debt for common stock,
 December 1995 .....      380,704            39      1,406,848        --         --              --             --        1,406,887
Net loss ...........         --              --        --             --         --            (5,414,878)      --       (5,414,878)
                       ----------    ------------    ---------      ------      ---           ------------  ----------  ------------
Balance, December 31,
 1995                   4,721,268           472      4,736,933        --         --            (7,978,063)   (11,906)    (3,252,564)
Exchange of short-term
 debt for common stock,
 net of expenses
 (unaudited) .......      221,195            22        571,167        --         --              --             --          571,189
Sales of common stock,
 net of expenses
 (unaudited) .......      304,016            31        896,481        --         --              --             --          896,512
Exchange of trade
 payables for common
 stock (unaudited) .       69,332             7        207,991        --         --              --             --          207,998
Issuance of warrants  
 (unaudited) .......         --              --        115,000        --         --              --             --          115,000
Net loss (unaudited)         --              --          --           --         --           (3,081,082)       --       (3,081,082)
                       ----------    ------------    ----------    ------       ---          ------------    --------- -------------
Balance, September 30,
 1996 (unaudited) ..    5,315,811    $      532     $6,527,572      $ --        $--         $(11,059,145)   $(11,906)  $ (4,542,947)
                       ==========    ============    ==========    ======       ===         =============   ========== =============
    
</TABLE>

                           See accompanying notes.

                                       F-7

<PAGE>
                MULTIMEDIA ACCESS CORPORATION AND SUBSIDIARIES
                        (A DEVELOPMENT STAGE COMPANY)
                    CONSOLIDATED STATEMENTS OF CASH FLOWS

<TABLE>
<CAPTION>
                                                                                                                 CUMULATIVE
                                                                                   FOR THE NINE MONTHS              FROM
                                                   YEAR ENDED DECEMBER 31,         ENDED SEPTEMBER 30,            INCEPTION
                                                  ------------------------      ------------------------     (NOVEMBER 19, 1992)
                                                  1994             1995           1995           1996       TO SEPTEMBER 30, 1996
                                                                               (UNAUDITED)    (UNAUDITED)        (UNAUDITED)
<S>                                             <C>            <C>            <C>            <C>            <C>
Operating activities:
 Net loss.....................................  $(2,717,421)   $(5,414,878)   $(3,509,510)   $(3,081,082)   $(11,861,511)
 Adjustments to reconcile net loss to net cash
  used in operating activities:
  Depreciation of fixed assets................       50,109        126,443         93,267        114,929         292,305
  Amortization of software development........            0        222,632         69,853         38,106         260,738
  Amortization of patent......................       30,251         90,677         22,669             --         151,129
  Loss on asset dispositions..................           --          1,955          2,280             --           1,955
  Non-cash charges to interest expense........           --        264,777        140,125         69,165         333,942
  Common stock issued in lieu of cash for
   consulting services........................       22,000             --             --             --          22,000
  Inventory reserve adjustment................           --        220,000             --             --         220,000
  Write off of deferred charges...............           --        376,633        306,633             --         376,633
  Changes in operating assets and liabilities:
   Accounts receivable........................      (19,120)        32,208        (51,496)      (124,191)       (128,564)
   Inventory..................................     (365,103)       (52,366)       (13,221)      (179,844)       (597,313)
   Prepaid expenses...........................      (36,331)        17,360          9,344        (51,296)        (70,267)
   Due from debt holder.......................           --       (315,300)      (315,300)       315,300              --
   Deferred charges...........................     (458,887)        38,089       (326,176)      (363,368)       (784,166)
   Deposits...................................      (17,829)          (368)           591            (75)        (18,272)
   Accounts payable...........................      336,723        147,537         92,982        151,185         731,345
   Accrued compensation.......................      (50,836)       100,513        147,496       (124,220)        230,048
   Deferred revenue...........................        1,880         58,042              0        (48,422)         27,091
   Other accrued liabilities..................      200,461        219,696        172,219        420,490         913,699
                                                -------------- -------------- -------------- -------------- --------------------
    Net cash used in operating activities.....   (3,024,103)    (3,866,350)    (3,158,244)    (2,863,323)     (9,899,208)
                                                -------------- -------------- -------------- -------------- --------------------
Investing activities:
 Purchase of property and equipment...........     (532,871)      (108,143)       (57,637)      (111,080)       (764,680)
 Software development costs...................     (210,256)      (156,171)      (284,560)       (11,000)       (377,427)
 Purchase of patent...........................           --             --             --             --        (151,129)
 Other........................................           --         28,076         26,64              --          28,076
                                                -------------- -------------- -------------- -------------- --------------------
    Net cash used in investing activities.....     (743,127)      (236,238)      (315,552)      (122,080)     (1,265,160)
                                                -------------- -------------- -------------- -------------- --------------------
Financing activities:
 Net proceeds from issuance (repayment) of
  short-term debt.............................     (100,000)     1,096,000      1,061,000      1,585,000       2,806,000
 Net proceeds from issuance (repayment) of
  short-term debt- officer....................      (87,000)       345,000        345,000             --         345,000
 Other........................................       (1,210)        (8,270)        (6,130)        (6,733)        (16,213)
 Proceeds from issuance of long-term debt.....    2,040,300        500,115        500,115        500,000       3,040,415
 Proceeds from exercise of stock options and
  warrants....................................       26,268             --             --             --          26,406
 Purchase of treasury stock...................           --        (11,906)           (26)            --         (11,906)
 Net proceeds from sale of common stock.......    1,917,241      2,166,894      2,500,000        912,054       4,996,189
                                                -------------- -------------- -------------- -------------- --------------------
    Net cash provided by financing activities.    3,795,599      4,087,833      4,399,959      2,990,321      11,185,891
                                                -------------- -------------- -------------- -------------- --------------------
Net increase (decrease) in cash and cash
 equivalents..................................       28,369        (14,755)       926,163          4,918          21,523
Cash and cash equivalents, beginning of
 period.......................................        2,991         31,360         31,360         16,605              --
                                                -------------- -------------- -------------- -------------- --------------------
Cash and cash equivalents, end of period .....  $    31,360    $    16,605    $   957,523    $    21,523    $     21,523
                                                ============== ============== ============== ============== ====================
</TABLE>

                           See accompanying notes.

                                       F-8

<PAGE>
                MULTIMEDIA ACCESS CORPORATION AND SUBSIDIARIES
                        (A DEVELOPMENT STAGE COMPANY)

                NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

   
(INFORMATION WITH RESPECT TO SEPTEMBER 30, 1996 AND THE NINE MONTH PERIODS ENDED
                   SEPTEMBER 30, 1995 AND 1996 IS UNAUDITED.)
    

1. THE COMPANY AND GOING CONCERN CONSIDERATIONS

   The accompanying  consolidated  financial  statements include the accounts of
MultiMedia  Access  Corporation  (MMAC),  and  its  wholly-owned   subsidiaries,
Viewpoint Systems,  Inc.  (Viewpoint),  VideoWare,  Inc.  (VideoWare) and Osprey
Technologies,  Inc.  (Osprey)  (collectively,  the  Company).  MMAC,  Viewpoint,
VideoWare and Osprey were  incorporated  in Delaware in February 1994,  November
1992,  September  1994  and  September  1995,  respectively.  The  Company  is a
development  stage company  engaged in developing  and marketing  advanced video
communications  products that integrate video capabilities into existing desktop
computers,  applications and networks. The Company markets its products directly
to end-users,  through  value-added  resellers and computer system  integrators,
primarily in the continental United States.

   The Company's capital requirements in connection with the design, development
and  commercialization  of its  products  have  been  and  will  continue  to be
significant.  To date, the Company has been  substantially  dependent upon loans
from its principal  stockholders,  as well as private placements of its debt and
equity securities,  to finance its working capital requirements.  The Company is
dependent  on the  proceeds of this  offering to commence  full-scale  marketing
activities  in  connection  with its products,  to complete the  development  of
additional  product and software  applications  and to fund its working  capital
requirements.  In the  event  that the  Company's  plans  change  or prove to be
inaccurate or if the proceeds of this offering prove to be  insufficient to fund
operations,  the Company could be required to seek additional  financing  sooner
than  currently  anticipated  or could  be  required  to  curtail  or cease  its
activities.  The Company has no current arrangements with respect to, or sources
of,   additional   financing  and  there  can  be  no  assurance  that  existing
stockholders  will  provide  any  portion  of  the  Company's  future  financing
requirements.  There can be no assurance that any  additional  financing will be
available to the Company on acceptable terms, or at all.

   Inasmuch as the Company intends to increase its level of activities following
consummation  of  this  offering  and  will  be  required  to  make  significant
expenditures  in connection with marketing and product  development  activities,
the Company anticipates that losses will continue for the foreseeable future and
until such time as the Company is able to build an effective marketing and sales
organization,  develop a network of  independent  resellers  and achieve  market
acceptance of its products.

   There  can be no  assurance  that the  Company  will be able to  successfully
implement  its  marketing  strategy,  generate  significant  revenues or achieve
profitable operations.

   
   The  accompanying   consolidated  financial  statements  have  been  prepared
assuming that the Company will continue as a going concern.  As reflected in the
accompanying consolidated financial statements, the Company incurred significant
losses of $2,717,421 and $5,414,878 during the years ended December 31, 1994 and
1995,  respectively,  and $3,081,082  during the nine months ended September 30,
1996 (unaudited). These losses, in conjunction with the matters discussed above,
raise  substantial  doubt  about the  Company's  ability to  continue as a going
concern.  The consolidated  financial  statements do not include any adjustments
which  might be  necessary  should the  Company be unable to continue as a going
concern.     

2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

BASIS OF PRESENTATION

   In May 1994 the Company acquired Viewpoint in a transaction  accounted for as
a pooling of interests  (see Note 3). The  accompanying  consolidated  financial
statements include the financial position,  results of operations and cash flows
of  Viewpoint,  as  adjusted  retroactively  to give  effect to the  pooling  of
interests.  All material  intercompany  transactions  have been  eliminated.  No
changes  in  accounting  policies  were  adopted  as a result of the  pooling of
interests.

                                       F-9


<PAGE>
              MULTIMEDIA ACCESS CORPORATION AND SUBSIDIARIES -
                          (A Development Stage Company)
          NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS -(Continued)

CASH AND CASH EQUIVALENTS

   The Company considers all highly liquid investments purchased with an initial
maturity of three months or less to be cash equivalents.

INVENTORY

   Inventory consists primarily of purchased electronic  components and computer
system  products,  along with the related  documentation  manuals and  packaging
materials.  Inventory  is  carried  at the  lower of cost or  market.  Effective
January 1, 1995,  the Company  changed its method of costing  inventory from the
first-in,  first-out  method to the  standard  cost method,  which  approximates
average cost. This change did not result in any material change in the valuation
of inventory.

PROPERTY AND EQUIPMENT

   Property and equipment is recorded at cost.  Depreciation is determined using
the straight-line method over the estimated useful lives,  generally five years,
of the related assets.  Leasehold  improvements  are amortized over the lives of
the related  leases.  Expenditures  for repairs and  maintenance  are charged to
operations as incurred; renewals and betterments are capitalized.

SOFTWARE DEVELOPMENT COSTS

   
   Costs of developing new software  products and  substantial  enhancements  to
existing  software  products  are  expensed  as  incurred  until   technological
feasibility has been established, after which time additional costs incurred are
capitalized in accordance with Statement of Financial  Accounting  Standards No.
86,  "Accounting  for the Costs of  Computer  Software  to be Sold,  Leased,  or
Otherwise  Marketed."  Amortization of capitalized  software  development  costs
begins when  products are available  for general  release to  customers,  and is
computed using the straight-line method over a period not to exceed three years.
No amount was charged to  amortization  expense  through  December 31, 1994, and
$222,632  (including $155,597 to fully amortize remaining costs of the Viewpoint
product line) and $38,106 was charged to  amortization  expense  during the year
ended  December  31,  1995  and  the  nine  months  ended   September  30,  1996
(unaudited), respectively.     

PATENT

   The Company holds a patent  related to its  proprietary  technology and trade
secrets.  The costs  associated  with  obtaining  and  defending  the patent are
amortized on the straight-line  basis over its estimated  remaining life, not to
exceed five years.  During 1995, the Company fully  amortized its patent.  Total
accumulated amortization of patent costs was $60,452 at December 31, 1994.

REVENUE RECOGNITION

   Revenue  from the sale of video  communication  systems and  licensing of the
related software is recognized upon shipment to customers.  With pre-approval by
a return merchandise  authorization,  a customer may return undamaged product to
the Company,  subject to a 30-day money back guarantee. The Company maintains an
accrued  warranty  reserve for products which are returned  defective during the
warranty period.

NET LOSS PER SHARE

   Net loss per share is computed based on the weighted average number of common
and common  equivalent shares  outstanding.  The Company has computed common and
common equivalent shares in determining the number of shares used in calculating
earnings per share for all periods presented pur-

                                      F-10

<PAGE>
              MULTIMEDIA ACCESS CORPORATION AND SUBSIDIARIES -
                          (A Development Stage Company)
          NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS -(Continued)


suant to the Securities and Exchange  Commission Staff Accounting Bulletin (SAB)
No. 83. SAB No. 83 requires  the  Company to include  all common  shares and all
common share equivalents issued in the 12 month period preceding the filing date
of the initial public  offering in its  calculation of the number of shares used
to determine  earnings per share as if the shares had been  outstanding  for all
periods presented.  Options and warrants issued more than 12 months prior to the
initial public offering have been excluded since their effect is antidilutive.

   
   Supplemental  loss per share is $.95 for the year ended December 31, 1995 and
$.46 for the nine months  ended  September  30, 1996  (unaudited)  assuming  (1)
issuance of the securities offered by the Company hereby, receipt by the Company
of the net  proceeds  thereof  and use of the  proceeds  to repay  $257,548  and
$1,192,548 principal amount of secured and demand notes at December 31, 1995 and
September  30,  1996  (unaudited),  respectively,  and  to  repay  approximately
$347,250  principal  amount of convertible  debt and (2) weighted average common
and common  equivalent  shares of  5,652,147  and  6,563,130  for the year ended
December  31, 1995 and the nine months  ended  September  30, 1996  (unaudited),
respectively.     

DEFERRED CHARGES AND OTHER ASSETS

   
   Deferred  charges at December  31, 1994  consisted of legal,  accounting  and
other expenses  associated  with the private  placement of 8% promissory  notes,
which were amortized using the straight-line  method over the term of the notes.
During 1995, the Company incurred $333,106 of additional  legal,  accounting and
underwriting  costs in connection with a private placement of common stock which
have been charged against the proceeds from the sale of the common stock. During
1995, the Company wrote off deferred  charges  consisting of legal,  accounting,
underwriting  and printing costs incurred in connection with a canceled  initial
public  offering of common stock which  resulted in a charge  against  income of
$376,633.  Deferred  charges at September 30, 1996 consist of legal,  accounting
and other expenses  associated with the impending  initial public  offering,  as
well as expenses  associated  with the issuance of 8% debt in July and September
of 1996.     

   During  September  1995 the  Company  advanced a debt  holder of the  Company
$315,300 which was repaid in the first quarter of 1996.

CONCENTRATION OF CREDIT RISK

   The Company invests its cash with financial institutions that include a Texas
commercial  bank and a commercial  brokerage  firm. The brokerage firm maintains
accounts in several banks  throughout the country and in government  securities.
Cash balances at the Texas  commercial  bank are insured by the Federal  Deposit
Insurance Corporation up to $100,000. The Company believes it has no significant
concentration of credit risk.

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 amounts reported in the financial statements and accompanying notes.
Actual results could differ from those estimates.

INCOME TAXES

   The Company  utilizes the liability  method of accounting for income taxes as
set forth in Statement of Financial  Accounting  Standards No. 109,  "Accounting
for Income Taxes." Under this method,  deferred tax assets and  liabilities  are
determined  based upon the differences  between the financial  statement and tax
bases of assets and  liabilities,  as measured by the enacted tax rates expected
to be in effect when these differences reverse.

                                      F-11

<PAGE>
              MULTIMEDIA ACCESS CORPORATION AND SUBSIDIARIES -
                          (A Development Stage Company)
          NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS -(Continued)


FAIR VALUE OF FINANCIAL INSTRUMENTS

   Management  expects  its  pending  initial  public  offering to result in the
conversion to common stock or settlement in cash of its  outstanding  short-term
and long-term debt. However, as a result of the uncertainties  described in Note
1, management  believes it is not practicable to determine the fair value of its
short and long term debt in accordance  with  Statement of Financial  Accounting
Standards No. 107.

Interim Financial Information

   
   The  consolidated  financial  statements as of September 30, 1996 and for the
nine months ended September 30, 1995 and 1996 are unaudited and include,  in the
opinion of  management,  all  adjustments,  consisting of only normal  recurring
adjustments,  which the  Company  considers  necessary  to  present  fairly  the
financial  position,  results of  operations  and cash flows of the  Company for
those interim periods. The operating results for the nine months ended September
30, 1996 are not necessarily  indicative of the results that may be expected for
the full fiscal year.     

3. ACQUISITION OF VIEWPOINT

   In May 1994, the Company acquired Viewpoint in a transaction accounted for as
a pooling of interests. The Company acquired all of the outstanding common stock
and options to purchase common stock of Viewpoint in exchange for 812,440 shares
of common  stock,  resulting  from the  exercise of 194,180  options and 511,000
warrants  exercised in 1993 and 107,261 warrants  exercised in 1994, and 287,564
stock  options to purchase  the  Company's  common  stock.  This  represents  an
exchange  ratio  of .511 of the  Company's  common  shares  for  each  share  of
Viewpoint.  The  options  issued in  exchange  for the  Viewpoint  options  have
exercise  prices ranging from $.02 to $.20 a share and expire between  September
2003 and May 2004.

   A summary of the results of  operations  of MMAC and Viewpoint for the period
February 1994 through May 1994 and January 1994 through May 1994,  respectively,
is as follows:

                                   MMAC       VIEWPOINT
                              ------------ ------------
                    Sales.....  $      --    $  16,077
                              ============ ============
                    Net loss .  $(148,634)   $(154,236)
                               ============ ============   

4. INVENTORY

     Inventory consists of the following:

                                        DECEMBER 31,      
                                   ------------------    SEPTEMBER 30,   
                                   1994          1995       1996
                                   -------------------   ------------
                                                       (UNAUDITED)
     Purchased materials..........  $229,019   $144,986   $239,652
     Finished goods.....             136,084     52,483    137,661
                                   ---------- ---------- --------------
                                    $365,103   $197,469   $377,313
                                    ========== ========== ==============

   
   Results of operations for 1995 reflect a charge of $220,000 for technological
obsolescence  of component  parts and finished goods  associated with one of the
Company's  early-developed  product  lines.  Inventory  at December 31, 1995 and
September  30, 1996  (unaudited)  is  presented  net of a $220,000  and $215,000
reserve, respectively.     

                                      F-12


<PAGE>
              MULTIMEDIA ACCESS CORPORATION AND SUBSIDIARIES -
                          (A Development Stage Company)
          NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS -(Continued)

5. PROPERTY AND EQUIPMENT

   Property and equipment, at cost, consists of the following:

<TABLE>
<CAPTION>
                                                      DECEMBER 31,       
                                                 ----------------------  SEPTEMBER 30,
                                                   1994        1995          1996     
                                                   ----        ----          ----     
                                                                          (UNAUDITED)
<S>                                              <C>        <C>         <C>
Computer equipment.............................  $432,275   $ 455,055   $ 521,305
Software.......................................    39,756      79,552     121,841
Leasehold improvements.........................    36,985      36,985      36,985
Office furniture and equipment.................    75,949      85,090      87,630
                                                 ---------- ----------- --------------
                                                  584,965     656,682     767,761
Less accumulated depreciation and amortization    (50,934)   (170,982)   (285,910)
                                                 ---------- ----------- --------------
                                                 $534,031   $ 485,700   $ 481,851
                                                 ========== =========== ==============
</TABLE>

6. SHORT-TERM DEBT

   Short-term debt consists of the following:

<TABLE>
<CAPTION>
                                                            DECEMBER 31,     
                                                       ---------------------    SEPTEMBER 30,
                                                       1994             1995      1996
                                                       ---------------------    -------------
                                                                                (UNAUDITED)
<S>                                                    <C>        <C>           <C>
Officer:
 Secured note payable to an officer and affiliate
  of the Company, due on demand with interest at
  15%. Collateralized by all assets of the
  Company........................................      $   --     $364,154      $  364,154
                                                       ======== ========== ===============
Other:
 Secured note payable to an individual investor,  
  due on demand with interest at 15%.  Collat-
  eralized by all assets of the Company....            $   --       22,548          22,548

 Convertible secured debt payable to a princi-
  pal stockholder of the Company, due  on de-
  mand 10 days  subsequent to an initial public  
  offering or 180 days after date of issue, with 
  interest at 8%. Collateralized by all assets of 
  the Company........................................      --              --       500,000

 Unsecured notes payable to a stockholder of the
  Company, due on demand 10 days subsequent to an 
  initial public offering or 180 days after date
  of issue with interest at 8%...................          --              --       350,000

 Unsecured, non-interest bearing note payable to
  one of the Company's underwriters .............          --           35,000      120,000

 Other...........................................         8,271          9,085       11,006
                                                       --------       ---------- ---------------
 Total short-term debt, other ...................        $8,271       $ 66,633   $1,003,554
                                                       ========       ========== ===============

</TABLE>

   Between  February and May 1995, the Company  issued  $1,096,000 of 15% 90-day
secured notes to existing  stockholders,  an officer and director of the Company
and two individual investors. The secured

                                      F-13

<PAGE>
              MULTIMEDIA ACCESS CORPORATION AND SUBSIDIARIES -
                          (A Development Stage Company)
          NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS -(Continued)

notes were  collateralized by all assets of the Company. As an incentive to lend
the  secured  debt to the  Company,  an  officer  and  director,  and two former
directors of the Company (all three founders and significant stockholders of the
Company),  sold 202,750 of their common shares to the lenders at par value.  The
excess of the fair market value of the shares of $.50 per share as determined by
independent  appraisal sold to the note holders over their purchase  price,  was
charged to expense over the term of the notes as additional interest expense.

   During June and July 1995, $310,000 of 15% unsecured demand notes were issued
to  existing  stockholders,  note  holders  and an officer  and  director of the
Company. As an incentive to lend the unsecured debt to the Company,  the Company
issued 77,500 three-year warrants to purchase common stock at $1.00 per share to
the  lenders.  The fair market value of the  warrants of $.50 as  determined  by
independent  appraisal,  was  charged to interest  expense  over the term of the
notes.

   In December 1995, $791,000 of the secured notes and $250,000 of the unsecured
notes,  along with accrued  interest of  $101,109,  were  exchanged  for 380,704
shares of common stock plus 520,500 three-year warrants to purchase common stock
at $1.00 per share.  As determined  by  independent  appraisal,  the fair market
value of the equity instruments exchanged equaled the carrying value of the debt
and accrued interest and, accordingly, no gain or loss was recorded.

   Additionally,  in December  1995, in connection  with the exchange of secured
notes for demand  notes,  the  Company  issued  109,500  three-year  warrants to
purchase  common  stock at $1.00 per share to the  holders  of the  secured  and
unsecured notes remaining outstanding.  103,500 of these warrants were issued to
the Company's Chief Executive Officer.  Based on an independent  appraisal,  the
fair  market  value of these  warrants of $.60 per share was charged to interest
expense.

   In January  and  February  1996,  the Company  issued  $650,000 of 10% 90-day
secured  notes to an existing  stockholder  of the  Company.  As an incentive to
advance these notes,  the  stockholder  was granted the right to receive  65,000
three-year  warrants to purchase  Company stock at $3.00 per share.  Based on an
independent appraisal, the fair market value of these warrants of $.50 per share
was charged to interest expense over the term of the notes.

   
   In July of 1996, the Company issued $500,000 of 8% secured  convertible  debt
to a principal stockholder of the Company. The convertible debt is due on demand
10 days  subsequent  to an  initial  public  offering  of the  Company's  equity
securities  or 180 days from date of issue.  As an  incentive  to advance  these
notes,  the  stockholder  was  granted  the right to receive  50,000  three-year
warrants to purchase  Company stock at $3.00 per share.  Based on an independent
appraisal,  the fair market  value of these  warrants of $.50 per share is being
charged to interest expense over the term of the debt.

   In September of 1996, the Company issued $350,000 of 8% unsecured notes to an
existing  stockholder  of the  Company.  The  notes  are due on  demand  10 days
subsequent to an initial public offering of the Company's  equity  securities or
180 days from  date of issue.  As an  incentive  to  advance  these  notes,  the
stockholder  was  granted  the right to receive  50,000  three-year  warrants to
purchase  Company stock at $3.00 per share.  Based on an independent  appraisal,
the fair market value of these  warrants of $1.00 per share is being  charged to
interest expense over the term of the notes.

   Interest paid was $11,377, $23,811 and $1,046 for the year ended December 31,
1994  and 1995  and the  nine  months  ended  September  30,  1996  (unaudited),
respectively.     

                                      F-14


<PAGE>
              MULTIMEDIA ACCESS CORPORATION AND SUBSIDIARIES -
                          (A Development Stage Company)
          NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS -(Continued)


7. LONG-TERM DEBT

   Long-term debt consists of the following:

<TABLE>
<CAPTION>
                                                         DECEMBER 31,        
                                                 --------------------------           SEPTEMBER 30,
                                                  1994                 1995               1996
                                                  ----                 ----               ----
                                                                                       (UNAUDITED)
<S>                                               <C>                  <C>          <C>
Convertible notes...............................  $2,067,300          $2,567,300   $2,567,300
Short-term notes converted to convertible notes.     110,135             110,250      110,250
Convertible secured debt payable to a principal 
 stockholder of the Company, due January 1998
 with interest at 8%, collateralized by all
 assets of the Company...........................         --               --         500,000
Other...........................................      17,739               8,654           --
                                                  ------------      ------------ --------------
                                                   2,195,174           2,686,204    3,177,550
Less: current portion of convertible notes  ....         --            2,677,550    2,677,550
                                                  ------------      ------------ --------------
                                                  $2,195,174          $    8,654   $  500,000
                                                  ============      ============ ==============

</TABLE>

   
   In September 1994 the Company began a private  placement of convertible  debt
(the Agreements) and through March 31, 1995, received $2,567,300.  The unsecured
convertible promissory notes, which were sold in units of $10,000, bear interest
at 8% and mature  between  March 1996 and July 1996. As of December 31, 1995 and
September 30, 1996 all of the  convertible  notes are scheduled to mature within
twelve months and, therefore, have been classified as a current liability.     

   The  Agreements  allow  convertible  note  holders,  upon a  proposed  public
offering of the Company's equity securities with proceeds exceeding  $2,000,000,
the right to convert their notes to registered  equity securities of the Company
at the public offering price and receive 5,000  three-year  warrants to purchase
the  Company's   common  stock  at  $3.00  per  share  for  each  $10,000  unit.
Alternatively,  the convertible  note holders may elect to request  repayment of
their notes from the proceeds of the proposed  public offering and receive 3,334
three-year  warrants to purchase  the  Company's  common stock at $3.00 for each
$10,000 unit. In June of 1996,  holders of  $2,330,300  principal  amount of the
convertible  notes elected to convert into Common Stock and Public  Warrants and
holders of $347,250  principal  amount elected to be repaid from the proceeds of
this  offering.  In  addition,  by  virtue  of  the  aforementioned   elections,
convertible notes in the amount of $2,067,300,  which originally matured between
March and June of 1996,  were extended to the closing date of the initial public
offering.

   
   In July of 1996, the Company issued $500,000 of 18-month 8% convertible  debt
to a principal  stockholder  of the Company.  As an  incentive to advance  these
notes,  the  stockholder  was  granted  50,000  three-year  warrants to purchase
Company stock at $3.00 per share.  Based on an independent  appraisal,  the fair
market  value of these  warrants of $.50 per share is being  charged to interest
expense over the term of the notes.

   Effective  December 1994,  certain  short-term  debt holders  converted their
promissory notes including accrued interest to $110,250 of convertible notes.
    

                                      F-15

<PAGE>
              MULTIMEDIA ACCESS CORPORATION AND SUBSIDIARIES -
                          (A Development Stage Company)
          NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS -(Continued)

1994                                         

8. INCOME TAXES

   Prior to the pooling  with the  Company  which was  consummated  in May 1994,
Viewpoint had elected to be treated as an S Corporation  for federal  income tax
purposes.  As an S  Corporation,  the tax  effect of  Viewpoint's  revenues  and
expenses were attributed  directly to its stockholders on a pass-through  basis.
Accordingly, the accompanying consolidated financial statements do not reflect a
provision  for income taxes for  Viewpoint  for any tax  reporting  period ended
prior to May  1994.  Net  operating  losses  and any tax  credits  generated  by
Viewpoint  while it was an S  Corporation  are not  available  to the Company to
offset  taxable  income,  if any,  generated  after the change to C  Corporation
status. Accordingly,  accumulated deficits of $802,366 generated by Viewpoint as
an S  Corporation  from  November  19,  1992  through  May 10,  1994,  have been
reclassified to additional paid-in capital.  Viewpoint's S Corporation  election
was terminated effective with the pooling of interests discussed in Note 3.

   
   MMAC, VideoWare and Osprey have been classified as C Corporations since their
inception in February  1994,  September 1994 and September  1995,  respectively.
Accordingly, the Company has accounted for income taxes for these entities since
their  respective  dates of  inception,  and for  Viewpoint  since May 1994,  in
accordance  with  Statement of Financial  Accounting  Standards  (SFAS) No. 109,
"Accounting for Income Taxes." SFAS No. 109 requires a valuation allowance to be
recorded  when it is  "more  likely  than not that  some  portion  or all of the
deferred  tax  assets  will not be  realized."  In the  opinion  of  management,
realization of the Company's net operating loss  carryforward  is not reasonably
assured, and a valuation allowance of $1,076,000,  $2,966,000 and $4,051,000 has
been provided  against deferred tax assets in excess of deferred tax liabilities
in the accompanying  consolidated  financial statements at December 31, 1994 and
1995 and September 30, 1996 (unaudited), respectively.     

   The components of the Company's net deferred taxes are as follows:
<TABLE>
<CAPTION>

                                                                      DECEMBER 31,                                  
                                                                 --------------------------           SEPTEMBER 30,  
                                                                 1994                 1995               1996         
                                                                 ----                 ----               ----         
                                                                                                      (UNAUDITED)     
<S>                                                              <C>                 <C>           <C>
Deferred tax assets:
 Net operating loss carryforward........................         $     997,000       $ 2,860,000   $ 3,868,000
 Excess of tax over financial statement basis of patent                 13,000            45,000        42,000
 Accruals deductible for tax purposes when paid.........               160,000           156,000       228,000
                                                                 --------------      ------------- --------------
   Total deferred tax assets ...........................             1,170,000         3,061,000     4,138,000
Less: valuation allowance...............................            (1,076,000)       (2,966,000)   (4,051,000)
                                                                 --------------      ------------- --------------
                                                                        94,000            95,000        87,000
Deferred tax liabilities:
 Excess of financial statement over tax basis of
  property and equipment................................                16,000            42,000        44,000
 Excess of financial statement over tax basis of
  software development costs............................                78,000            53,000        43,000
                                                                --------------      ------------- --------------
   Total deferred tax liabilities.......................                94,000            95,000        87,000
                                                                 ==============     ============= ==============
Net deferred taxes......................................         $          --      $         --  $         --
                                                                 ==============     ============= ==============

</TABLE>

                                      F-16

<PAGE>
              MULTIMEDIA ACCESS CORPORATION AND SUBSIDIARIES -
                          (A Development Stage Company)
          NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS -(Continued)

   A  reconciliation  between  the  federal  income tax  benefit  calculated  by
applying  U.S.  federal  statutory  rates to net loss and the  absence  of a tax
benefit reported in the  accompanying  consolidated  financial  statements is as
follows:

<TABLE>
<CAPTION>

                                                                 DECEMBER 31,                                  
                                                         --------------------------   SEPTEMBER 30, 
                                                            1994          1995           1996       
                                                            ----          ----           ----       
                                                                                       (UNAUDITED)   
<S>                                                      <C>          <C>            <C>
U.S. federal statutory rate applied to pretax loss  ...  $(924,000)   $(1,841,000)   $(1,047,500)

Accrued compensation and other accruals................     33,000          2,500        (22,500)
Amortization of patent.................................      6,000         27,500         (2,500)
Depreciation of property and equipment.................    (14,500)       (27,000)        (4,500)
Software development costs for financial reporting
purposes...............................................    (71,500)       (29,000)         9,000
Viewpoint 1994 S-Corporation loss......................     48,000             --             --
Net operating loss carryforward not recognized for
financial reporting purposes...........................    918,000      1,714,000      1,034,000
Inventory and doubtful account reserves ...............         --         50,500          3,000
Non-deductible interest expenses.......................         --         90,000         30,500
Other..................................................      5,000         12,500            500
                                                         ------------ -------------- --------------
                                                         $      --    $        --    $        --
                                                         ============ ============== ==============

</TABLE>

   
   The Company  has a federal  income tax net  operating  loss  carryforward  of
approximately  $7,400,000 at December 31, 1995.  Approximately $2,700,000 of the
carryforward will expire in 2009 and $4,700,000 will expire in 2010. The Company
is subject to  limitations  existing  under  Internal  Revenue  Code Section 382
(Change  of  Control)  relating  to  the  availability  of  the  operating  loss
carryforward.  Beginning with 1994,  approximately  $790,000 of the carryforward
that will expire in 2009 is limited to  utilization  at a rate of  approximately
$300,000 per year.     

9. STOCKHOLDERS' EQUITY (DEFICIT)

COMMON STOCK

   In March 1994 the Company sold  996,364  shares of common stock at a price of
$2.20 per share in a private placement to certain qualified investors.  Proceeds
to the Company were $1,917,241 net of related offering costs of $274,759.  These
offering  costs have been  charged  against  additional  paid-in  capital in the
accompanying consolidated financial statements.

   
   In September  1995,  the Company  began a second  private  placement of up to
2,666,667 shares of common stock to qualified investors.  In September 1995, the
Company  sold  833,333  shares to an  existing  stockholder  at $3.00 per share.
Proceeds  to the  Company  were  $2,166,894  net of  related  offering  costs of
$333,106.  The  offering  costs have been  charged  against  additional  paid-in
capital.  As  described  in Note 6, in  December  1995 and March  1996,  certain
secured and demand note holders of the Company exchanged $1,805,698 of notes and
accrued  interest for 601,899 shares of common stock and 520,500 warrants in the
offering.  In April through June of 1996, the Company sold 304,016 shares of the
offering to  individual  investors  at $3.00 per share.  Proceeds to the Company
were  $912,054.  Additionally,  in May and June of 1996,  the Company  converted
approximately $208,000 of accounts payable into 69,332 shares of the offering at
$3.00 per share.     

                                      F-17

<PAGE>
              MULTIMEDIA ACCESS CORPORATION AND SUBSIDIARIES -
                          (A Development Stage Company)
          NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS -(Continued)


STOCK OPTION PLAN

   In April  1995,  the Company  adopted its 1995 Stock Plan (1995 Stock  Option
Plan) under which  2,000,000  shares of the Company's  common stock are reserved
for issuance to officers,  key employees  and  consultants  of the Company.  The
objectives of the stock plan are to attract and retain  qualified  personnel for
positions of substantial responsibility, and to provide additional incentives to
employees  and  consultants  to promote the success of the  Company's  business.
Options granted under the plan may be incentive  stock options or  non-qualified
stock options.  The plan is administered by the Board of Directors.  The options
are granted at the  discretion  of the Board of Directors at an option price per
share not less than fair market value,  as determined by the Board of Directors,
at the date of grant.

   In April 1995,  the Company also adopted the 1995 Director  Option Plan under
which 250,000 shares of the Company's  common stock are reserved for issuance to
outside  directors of the  Company.  The  objective  of the director  plan is to
attract and retain qualified  personnel for service as outside  directors of the
Company,   and  to  encourage  their  continued   service  to  the  Board.  Only
non-qualified stock options may be granted.  Grants under the plan are automatic
and nondiscretionary,  and are issued at an option price per share not less than
fair market value, as determined the Board of Directors, at the date of grant.

   In February  1994 the Company  adopted its 1994 Stock Option Plan under which
2,000,000  shares of the  Company's  common stock were  reserved for issuance to
officers, key employees,  non-employee directors and consultants of the Company,
pursuant to incentive and non-qualified stock options.  Upon the adoption of the
1995 Stock Option  Plan,  the 1994 Stock  Option Plan was  terminated  as to any
future issuance of options.

   
   Upon the consummation of the pooling of interests  between Viewpoint and MMAC
in May 1994, all outstanding  stock options of Viewpoint were converted to stock
options of the Company at the pooling  exchange  ratio of .511 of the  Company's
common shares for each share of  Viewpoint.  The following is a summary of stock
option  activity  from December 31, 1993 through  September 30, 1996.  All stock
options  issued by Viewpoint have been restated to give effect to the pooling of
interests transaction described in Note 3.     

<TABLE>
<CAPTION>
                                         NON-QUALIFIED STOCK OPTIONS          INCENTIVE STOCK OPTIONS
                                         ---------------------------          -----------------------
                                        NUMBER           PRICE PER              NUMBER     PRICE PER
                                      OF SHARES             SHARE              OF SHARES     SHARE
                                      ---------             -----              ---------     -----
<S>                                   <C>              <C>                    <C>          <C>
Outstanding at December 31, 1993 ...   58,293           $   .20                 332,917     $  .02-.04

Granted.............................  510,000          .10-3.00               1,127,158      2.20-3.00
Exercised...........................      256               .20                 178,171            .02
Canceled............................       --                --                 224,405       .02-2.42
                                      -----------                            -----------
Outstanding at December 31, 1994 ...  568,037          .10-3.00               1,057,499       .04-3.00

Granted.............................  143,458              3.00                 549,800           3.00
Exercised ..........................       --                --                      --             --
Canceled ...........................  160,588         2.20-3.00                 346,432      2.20-3.00
                                      -----------                            -----------
Outstanding at December 31, 1995  ..  550,907          .10-3.00               1,260,867       .04-3.00

Granted (unaudited).................       --                                   765,400      3.00-4.00
Exercised (unaudited) ..............       --                                        --
Canceled (unaudited)................   35,833              3.00                 460,751      2.20-3.00
Outstanding at September 30, 1996
(unaudited) ........................  515,074         $.10-3.00               1,565,516      $.04-4.00
                                      ===========                            ===========

</TABLE>

                                      F-18

<PAGE>
              MULTIMEDIA ACCESS CORPORATION AND SUBSIDIARIES -
                          (A Development Stage Company)
          NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS -(Continued)


   At December 31, 1995, 176,820  non-qualified  stock options at prices ranging
from $.20 to $3.00 and 390,256  incentive  stock options at prices  ranging from
$.04 to $3.00 were exercisable.

WARRANTS

   
   The Company has issued  warrants to purchase  common  stock of the Company in
connection  with  certain  notes  payable  (as  described  in  Note  6)  and  as
compensation  for  services  rendered  by various  consultants,  and a financial
consulting  firm  controlled by an officer,  director,  and  stockholder  of the
Company.  All  warrants  issued  prior  to 1995  have  been  exercised  with the
exception of the rights  available to  convertible  debt holders as described in
Note 7. The  following is a summary of warrant  activity  from December 31, 1993
through  September 30, 1996. All warrants issued by Viewpoint have been restated
to reflect the pooling of interests transaction described in Note 3.
    
                                                      WARRANTS
                                               NUMBER OF      PRICE PER
                                                SHARES          SHARES
                                                ------          ------
Outstanding at December 31, 1993............     74,041   $     .02-.50

Granted.....................................     33,220         .20-.50
Exercised...................................    107,261         .02-.50
                                              -----------
Outstanding at December 31, 1994............         --
Granted.....................................  1,147,500        1.00-3.00
Exercised...................................         --               --
Outstanding at December 31, 1995............  1,147,500        1.00-3.00
Granted (unaudited).........................    295,005             3.00
Exercised (unaudited).......................         --
                                              -----------
Outstanding at September 30, 1996
(unaudited).................................  1,442,505    $1.00-3.00
                                              ===========

   All warrants outstanding at December 31, 1995 were exercisable.

10. COMMITMENTS AND CONTINGENCIES

   The Company leases office  facilities under  non-cancelable  operating leases
extending through 1998 with an average monthly rental of $15,432.  The landlords
pay all operating costs and real estate taxes  associated with the office lease,
which is subject to cost  escalation  not to exceed 4% annually.  The Company is
amortizing the total rent payments over the lease term on a straight-line basis.
Prior  to  September  1994,  the  Company  leased  office   facilities  under  a
month-to-month  operating  lease with  monthly  payments  ranging from $1,300 to
$2,500.  The Company also leases  certain  office and computer  equipment  under
non-cancelable operating leases.

                                              OPERATING
                                               LEASES
                                             -----------
                 Year ended December 31:
                 1996.......................  $210,169
                 1997.......................   165,030
                 1998.......................    14,842
                              -----------
               Total minimum lease payments.  $390,041
                                             ===========

                                      F-19



<PAGE>
              MULTIMEDIA ACCESS CORPORATION AND SUBSIDIARIES -
                          (A Development Stage Company)
          NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS -(Continued)


   
   Rent expense was $59,495 and  $233,305 for the years ended  December 31, 1994
and 1995,  respectively,  and $187,441 for the nine months ended  September  30,
1996 (unaudited).

   The Company has entered into an employment  contract with its Chief Executive
Officer  through  February  1999 that  provides for a minimum  annual salary and
incentives based generally on the Company's performance. The total compensation,
including incentives,  which was accrued and included in accrued compensation in
the accompanying  consolidated  financial statements was $120,428,  $112,929 and
$77,781 at  December  31,  1994 and 1995 and  September  30,  1996  (unaudited),
respectively.     

11. RELATED PARTY TRANSACTIONS AND OTHER MATTERS

   During 1994 the Company sold certain desktop videoconferencing equipment to a
company  which has two  directors  who are former  directors  of the Company for
$58,260. Direct product costs associated with the sale aggregated $43,521.

   
   In February 1994 the Company entered into two five-year consulting agreements
with two of its former  directors,  pursuant to which the Company  agreed to pay
monthly consulting fees of $5,000 to each individual. In March 1995 one of these
consulting agreements was canceled with no further liability to the Company. The
Company paid $110,000 in such  consulting  fees for the year ended  December 31,
1994 and $72,500 and $12,500 in consulting fees remained accrued at December 31,
1995 and September 30, 1996 (unaudited),  respectively.  Consulting fees charged
to expense with respect to the aforementioned agreements were $110,000, $72,500,
and $20,000 for the years ended  December  31, 1994 and 1995 and the nine months
ended September 30, 1996 (unaudited), respectively. In June of 1996, the Company
converted $80,000 of accounts payable owed on the remaining consulting agreement
into  26,666  shares of common  stock at $3.00 per share.  By mutual  agreement,
effective May 1, 1996  consulting  fees from the remaining  consulting  contract
were suspended until the effective date of the initial public offering.

   In March 1994 the Company entered into a consulting  agreement with a company
which is owned by the Chief  Executive  Officer  of the  Company.  The  retainer
portion of this agreement was terminated effective December 31, 1994. Consulting
fees of $35,000,  $11,692 and $11,607 were accrued at December 31, 1994 and 1995
and September 30, 1996  (unaudited),  respectively.  Consulting  fees charged to
expense  during the year ended  December 31, 1994 with respect to this agreement
were  $35,000.  No amounts  were  charged to expense  during 1995 and $2,503 was
charged to expense during the nine months ended September 30, 1996  (unaudited).
Additionally,  $12,500  was paid by the  Company in 1995 for  services  rendered
during 1994. In May of 1996,  the Company  issued 5,005  three-year  warrants to
purchase  Company  stock at $3.00  per  share as  consideration  for  consulting
services rendered during 1996. The fair market value of the warrants of $.50 per
share was determined by independent appraisal.     

   From October 1994 through  January 1995 the Company  issued to four principal
stockholders, a principal stockholder and director of the Company and the spouse
of another principal stockholder and former director,  convertible debt totaling
$1,905,000  under the terms  described in Note 7. Upon completion of the initial
public offering, holders of $1,805,000 principal amount of this convertible debt
have  elected to  convert  their debt into  common  stock of the  Company at the
initial  offering price per share and holders of $100,000  principal amount have
elected to be repaid from the proceeds of the offering.

   From  February  through  April  1995,  the Company  issued to five  principal
stockholders  of the Company secured notes totaling  $1,070,000  under the terms
described in Note 6. During December 1995,  $781,000 of these secured notes were
exchanged for equity securities of the Company under the terms described in Note
6.

   
   During June and July 1995, the Company issued to three principal stockholders
of the Company demand notes totaling  $310,000 under the terms described in Note
6. During  December  1995,  $250,000 of these secured  notes were  exchanged for
equity securities of the Company under the terms described in Note 6.

                                      F-20
    

<PAGE>
   
              MULTIMEDIA ACCESS CORPORATION AND SUBSIDIARIES -
                          (A Development Stage Company)
          NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS -(Continued)


   During July 1996, the Company issued  $1,000,000 of secured  convertible debt
to a principal  stockholder of the Company.  The convertible debt bears interest
at 8%. $500,000 of the convertible  debt matures on demand 10 days subsequent to
an initial public offering of the Company's  equity  securities or 180 days from
date of issue, and the balance matures in 18 months.  As an incentive to advance
the debt, the  stockholder  was issued 100,000  three-year  warrants to purchase
Company stock at $3.00 per share.

   During July 1996, the Company issued to a stockholder  and former director of
the Company,  75,000 three-year  warrants to purchase Company stock at $3.00 per
share pursuant to the terms of a consulting  agreement  more fully  described in
Note 11.

12. SUBSEQUENT EVENTS (UNAUDITED)

   In October 1996, the Chief  Executive  Officer of the Company agreed to defer
receipt of $164,154 principal amount Secured and Demand Notes,  accrued interest
of $41,154 and accrued  salary and bonuses of $127,781  until December 1997. The
Company has agreed to pay the Chief Executive  Officer  interest rate of 15% per
annum on the deferred amount.  In addition,  the Chief Executive Officer will be
repaid  $200,000  principal  amount of  Secured  and  Demand  Notes and  $50,000
principal  amount of Convertible  Debt plus accrued  interest of $7,419 from the
proceeds of this offering.

   In October 1996, the Company issued $200,000 of 8% unsecured notes payable to
a stockholder of the Company.  The notes are due on demand 10 days subsequent to
an initial public  offeringof the Company's  equity  securities or 180 days from
the date of issue.

   In November 1996, the Company issued  $300,000 of 8% unsecured  notes payable
to two  stockholders  of the  Company.  The  notes  are  due on  demand  10 days
subsequent to an initial public offering of the Company's equity securities from
the date of issue.

    

                                      F-21

<PAGE>
                                
======================================     =====================================
     No  dealer,  salesperson  or  any
other  person has been  authorized  to
give  any  information  or to make any
representations   other   than   those
contained in this Prospectus,  and, if
given or  made,  such  information  or           MULTIMEDIA ACCESS 
representations  must not be relied on              CORPORATION
as  having  been   authorized  by  the
Company  or the  Representative.  This
Prospectus   does  not  constitute  an
offer to sell or the  solicitation  of
an  offer  to buy any  security  other
than the  securities  offered  by this
Prospectus,  or an  offer to sell or a
solicitation  of an  offer  to buy any
security   by   any   person   in  any
jurisdiction  in which  such  offer or
solicitation    would   be   unlawful.
Neither    the    delivery   of   this
Prospectus nor any sale made hereunder
shall, under any circumstances,  imply
that   the    information    in   this            1,800,000 SHARES
Prospectus  is  correct as of any time           OF COMMON STOCK AND
subsequent   to  the   date   of  this
Prospectus.

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

        TABLE OF CONTENTS

                                   Page
                                   ----
Prospectus Summary ................  3
Risk Factors ......................  8           1,800,000 REDEEMABLE
Use of Proceeds ................... 17              COMMON STOCK
Dividends.......................... 18             PURCHASE WARRANTS
Dilution .......................... 19
Capitalization .................... 21
Selected Consolidated Financial 
 Data  ............................ 22
Management's Discussion and
 Analysis of Financial Condition 
 and Results of Operations ........ 23
Business .......................... 28
Management ........................ 36
Principal Stockholders ............ 43                ----------
Certain Transactions .............. 45                PROSPECTUS
Description of Securities ......... 48                ----------
Shares Eligible for Future Sale ... 51
Underwriting ...................... 52
Concurrent Registration of 
 Securities  ...................... 55
Interest of Named Experts and 
 Counsel .......................... 55
Legal Matters ..................... 55
Experts ........................... 55
Additional Information ............ 56
Glossary ..........................  i
Index to Consolidated Financial                National Securities Corporation
 Statements .......................F-1
                                                Network 1 Financial Securities
     Until --, 1996 (25 days after the
date of this Prospectus),  all dealers
effecting    transactions    in    the
registered securities,  whether or not
participating  in  this  distribution,
may   be   required   to   deliver   a
Prospectus. This is in addition to the
obligation  of  dealers  to  deliver a
Prospectus when acting as underwriters                         , 1996

and  with   respect  to  their  unsold
allotments or subscriptions.
                     
======================================     =====================================


<PAGE>

            [ALTERNATE PAGE FOR SELLING SECURITYHOLDERS PROSPECTUS]

                 SUBJECT TO COMPLETION, DATED NOVEMBER 21, 1996

PROSPECTUS
  [LOGO]
   

                        MULTIMEDIA ACCESS CORPORATION
                        477,244 SHARES OF COMMON STOCK

              477,244 REDEEMABLE COMMON STOCK PURCHASE WARRANTS

   This  Prospectus  relates  to the  offer  and sale by  certain  persons  (the
"Selling  Securityholders")  of up to 477,244 shares of Common Stock, $.0001 par
value per share (the "Common Stock"),  477,244  redeemable common stock purchase
warrants to purchase one (1) share of Common Stock (the "Public  Warrants")  and
the  477,244  shares   underlying  the  Public  Warrants  of  Multimedia  Access
Corporation  (the  "Company"),  hereinafter  referred to as the "Offering".  The
shares offered hereby were issued in connection  with a debt retirement and debt
for equity exchange. Each Public Warrant entitles the holder to purchase one (1)
share of Common Stock at $ per share (120% of the price  offered to the public),
subject to adjustment  under certain  circumstances,  at any time commencing one
year from the date of this Prospectus  through and including five years from the
date of this Prospectus.  The Public Warrants are redeemable by the Company,  at
any time commencing eighteen (18) months from the date of this Prospectus,  upon
notice of not less than thirty (30) days, at a price of $.10 per Public Warrant,
provided  that the closing price or bid price of the Common Stock for any twenty
(20) trading days within a period of thirty (30) consecutive trading days ending
on the fifth  (5th) day prior to the day on which the  Company  gives  notice of
redemption  has been at least 250%  (currently $ , subject to adjustment) of the
then  effective  exercise  price of the Public  Warrants.  The Company  will not
receive any of the  proceeds  from the sale of such  shares of Common  Stock and
Public Warrants,  and the shares of Common Stock underlying the Public Warrants.
To the extent the Public  Warrants  and  Selling  Securityholders  Warrants  are
exercised,  the Company will receive proceeds  represented by the exercise price
of such Warrants. See "Selling Securityholders and Plan of Distribution."     

   Prior to this Offering,  there has been no public market for the Common Stock
or Public  Warrants  and there can be no  assurance  that any such  market  will
develop. It is anticipated that the Common Stock and the Public Warrants will be
quoted on the NASDAQ  Small-Cap  Market  ("NASDAQ") under the symbols "MMAC" and
"MMACW" respectively.  For a discussion of the factors considered in determining
the  offering  prices of the Common  Stock and  Public  Warrants,  see  "Selling
Securityholders and Plan of Distribution."

   Concurrently  with  this  Offering,  the  Company  is  offering  by  separate
prospectus  1,800,000  shares of Common Stock (the "Company Offered Shares") and
redeemable  warrants to purchase  1,800,000 shares of Common Stock (the "Company
Offered Public Warrants") (the "Company Offering").  See "Concurrent Registation
of Securities."
                                   ----------
  THE SECURITIES OFFERED HEREBY ARE SPECULATIVE AND INVOLVE A HIGH DEGREE OF
     RISK AND IMMEDIATE DILUTION AND SHOULD NOT BE PURCHASED BY INVESTORS
       WHO CANNOT AFFORD THE LOSS OF THEIR ENTIRE INVESTMENT. SEE "RISK
                           FACTORS" AND "DILUTION."
                                   ----------
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         , 1996

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 securities in any
State in which  such  offer,  solicitation  or sale would be  unlawful  prior to
registration or qualification under the securities laws of any such State.

<PAGE>
            [ALTERNATE PAGE FOR SELLING SECURITYHOLDERS PROSPECTUS]

                                 THE OFFERING


Securities Offered........    470,649  shares of Common  Stock,  470,649  Public
                              Warrants to purchase one (1) share of Common Stock
                              at $ (120% of price offered to the public) and the
                              470,649 shares underlying the Public Warrants. See
                              "Risk  Factors -- Warrants  Redeemable  at Nominal
                              Price" and "Description of Securities."
   
Common Stock to be Outstand-  
 ing after the Offering(1.    7,331,558
    
    
Warrants to be Outstanding
 after the Offering......     5,000,649 
    
Terms of the Public
 Warrants..................   Each  Public  Warrant is  exercisable  at any time
                              commencing   one  year   from  the  date  of  this
                              Prospectus  and  entitles  the  holder  thereof to
                              purchase one share of Common Stock at a price of $
                              per  share  (120%  of  the  price  offered  to the
                              public),   subject   to   adjustment   in  certain
                              circumstances,  at any time until five years after
                              the date of this  Prospectus.  The Public Warrants
                              are  redeemable  by  the  Company,   at  any  time
                              commencing  eighteen months after the date of this
                              Prospectus, at a price of $.10 per Public Warrant,
                              upon not less than 30 days prior written notice to
                              the  registered  holders of the  Public  Warrants,
                              provided  that the  closing  price or bid price of
                              the Common  Stock  equals or  exceeds  250% of the
                              exercise   price   (currently   $  ,   subject  to
                              adjustment)  of the  Public  Warrants  for  any 20
                              trading  days  within a period  of 30  consecutive
                              trading  days ending on the fifth day prior to the
                              day  on  which  the   Company   gives   notice  of
                              redemption.  See  "Description  of  Securities  --
                              Warrants."                                        

Risk Factors...............   The securities  offered hereby are speculative and
                              involve  a  high  degree  of  risk  and  immediate
                              substantial  dilution  and should not be purchased
                              by investors  who cannot  afford the loss of their
                              entire   investment.    See  "Risk  Factors"   and
                              "Dilution."

Proposed Nasdaq Symbols.....  Common Stock -- MMAC
                              Public Warrants -- MMACW
- ----------

   

   (1)  Includes  477,244  shares  of  Common  Stock  issued on the date of this
Prospectus  upon the  conversion of $2,330,300  principal  amount of Convertible
Debt and approximately $342,294 of accrued interest at the offering price of the
Common Stock and Public  Warrants  (based on an assumed  offering price of $5.50
per share and $.10 per Public Warrant). Does not include (i) 1,442,505 shares of
Common Stock  reserved for issuance  upon  exercise of  outstanding  warrants to
purchase common stock, (ii) 180,000 shares of Common Stock reserved for issuance
upon exercise of the Representative's  Warrants,  (iii) 180,000 shares of Common
Stock reserved for issuance upon exercise of  Representative's  Public  Warrants
issuable  upon exercise of  Representative's  Warrants,  (iv) 957,975  shares of
Common Stock reserved for issuance upon exercise of options available for future
grant under the 1995 Option Plan, (v) 1,042,025  shares of Common Stock reserved
for issuance upon exercise of options  granted under the 1995 Option Plan,  (vi)
906,749  shares of Common Stock  reserved for issuance  upon exercise of options
granted  under the 1994  Option  Plan,  (vii)  103,549  shares  of Common  Stock
reserved for issuance  upon  exercise of options  granted  under the 1993 Option
Plan,  (viii) 25,000 shares of Common Stock  reserved for issuance upon exercise
of options  granted  under the 1995  Directors  Stock Option Plan,  (ix) 225,000
shares of Common Stock reserved for issuance upon exercise of options  available
for future grant under the 1995 Directors  Stock Option Plan, (x) 250,000 shares
of Common Stock  reserved for issuance  under the Employee  Stock Purchase Plan,
(xi) 1,280,900 shares of Common Stock reserved for issuance upon exercise of the
Convertible  Debt Warrants,  (xii) 1,800,000 shares of Common Stock reserved for
issuance  upon exercise of the Public  Warrants,  and (xiii)  477,244  shares of
Common Stock  reserved for issuance upon exercise of Public  Warrants  issued on
the date of this Prospectus upon  conversion of $2,330,300  principal  amount of
Convertible Debt and approximately  $342,294 of accrued interest at the offering
price of Common Stock and Public Warrants based on an assumed  offering price of
$5.50 per share and $.10 per Public Warrant.  See  "Management's  Discussion and
Analysis of Financial Condition and Results of Operations," "Management -- Stock
Option Plans,"  "Description  of Securities -- Convertible  Debt  Financing" and
"Selling Securityholders and Plan Distribution."     

                                        6

<PAGE>
            [Alternate Page for Selling Securityholders Prospectus]


                                  RISK FACTORS

   The securities  offered hereby are  speculative  and involve a high degree of
risk. Each  prospective  investor should  carefully  consider the following risk
factors  inherent in and affecting the business of the Company and this offering
before making an investment decision.

   
   Development  Stage  Company;   Limited  Operating   History;   Going  Concern
Qualification  in  Independent  Auditor's  Report.  The Company is a development
stage company and has commenced limited marketing of its products.  Accordingly,
the Company has a limited  operating  history  upon which an  evaluation  of its
prospects can be made.  Such prospects must be considered in light of the risks,
expense,  delays,  problems  and  difficulties  frequently  encountered  in  the
establishment  of a  new  business  in  an  industry  characterized  by  intense
competition,  as well as risks  encountered  in the shift  from  development  to
commercialization  of  new  products  based  on  innovative  technologies.   The
Company's prospects are dependent upon the successful  commercialization  of its
products.  There can be no assurance  that the Company will be able to implement
its business  plan or that  unanticipated  expenses,  problems or  difficulties,
technical   or   otherwise,   will  not  result  in   material   delays  in  its
implementation. The Company's independent auditors have included a going concern
qualification  in their audit  report on the  Company's  consolidated  financial
statements  stating that such financial  statements have been prepared  assuming
that the Company will continue as a going concern and that,  among other things,
the Company's  financial  condition and losses from  operations  since inception
raise  substantial doubt about the ability of the Company to continue as a going
concern.  Statement  of  Financial  Accounting  Standards  No. 107 ("SFAS  107")
requires an entity to disclose the fair value of financial instruments for which
it is  practicable  to  estimate  that  value.  Manangement  of the  Company has
determined that it is not practicable to estimate,  in accordance with SFAS 107,
the fair  values at  December  31,  1995 of its long and short  term  debt.  See
"Management's  Discussion  and  Analysis of Financial  Condition  and Results of
Operations,"  "Business"  and  Note  1 and  Note  2 of  "Notes  to  Consolidated
Financial Statements."

   Limited Revenue;  Significant Losses;  Accumulated Deficit.  Since inception,
the Company has  generated  limited  revenue,  including  revenues of  $127,531,
$285,354,  and $900,446 and incurred  significant  losses,  including  losses of
$2,717,421,  $5,414,878 and $3,081,082 for the years ended December 31, 1994 and
1995,  and the nine months  ended  September  30,  1996,  respectively,  and has
continued to incur significant additional losses to date. At September 30, 1996,
cumulative  losses since inception  through September 30, 1996 were $11,861,511.
Inasmuch as the Company  intends to increase its level of  activities  following
consummation  of  this  offering  and  will  be  required  to  make  significant
expenditures  in connection with marketing and product  development  activities,
the Company anticipates that losses will continue for the foreseeable future and
until such time as the Company is able to build an effective marketing and sales
organization,  develop a network of  independent  resellers  and achieve  market
acceptance of its products.  In addition,  the Company's future performance will
be subject to a number of business factors beyond the Company's control, such as
technological  changes  and  developments  by  others  and  unfavorable  general
economic conditions,  including downturns in the economy or a decline in the DVC
or PC  industries  or in targeted  commercial  markets,  which would result in a
reduction or deferral of capital  expenditures by prospective  customers.  There
can be no assurance that the Company will be able to successfully  implement its
marketing  strategy,   generate   significant  revenues  or  achieve  profitable
operations. See "Management's Discussion and Analysis of Financial Condition and
Results of Operations" and "Consolidated Financial Statements."
    

   Significant Capital Requirements;  Dependence on Offering Proceeds;  Possible
Need for Additional Financing.  The Company's capital requirements in connection
with the design, development and commercialization of its products have been and
will continue to be  significant.  To date,  the Company has been  substantially
dependent  upon  loans  from  its  principal  stockholders,  as well as  private
placements  of its debt and equity  securities,  to finance its working  capital
requirements.  The Company is dependent on the proceeds of the Company  Offering
to commence full-scale marketing activities in connection with its products,  to
complete the development of additional product and software applications, and to
fund the Company's working capital requirements.  The Company anticipates, based
on currently proposed plans and assumptions relating to its operations, that the
proceeds of the Company  Offering will be sufficient to satisfy its contemplated
cash  requirements for at least twelve months following the consummation of 

                                        8

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the Company  offering.  In the event that the Company's plans change or prove to
be  inaccurate  or  if  the  proceeds  of  the  Company  offering  prove  to  be
insufficient  to  fund  operations,  the  Company  could  be  required  to  seek
additional  financing sooner than currently  anticipated or could be required to
curtail its activities. The Company has no current arrangements with respect to,
or sources of, additional financing, and there can be no assurance that existing
stockholders  will  provide  any  portion  of  the  Company's  future  financing
requirements.  There can be no assurance that any  additional  financing will be
available  to the Company on  acceptable  terms,  or at all.  Additional  equity
financing  may involve  substantial  dilution to the  interests of the Company's
then existing stockholders. See "Use of Proceeds" and "Certain Transactions."
    

   Technological    Factors;    Uncertainty   of   Product    Development    and
Commercialization.   The   Company   has   only   recently   commenced   limited
commercialization  of its products for a limited  number of users.  Accordingly,
there can be no assurance that,  upon  widespread  commercial use, if any, these
products  will  satisfactorily  perform all of the functions for which they have
been designed or that they will operate  satisfactorily.  The Company intends to
use a portion of the  proceeds  of this  offering  in  connection  with  product
refinement and enhancement and the development of additional  products.  Product
development,  commercialization  and continued system refinement and enhancement
efforts  remain  subject  to all of the risks  inherent  in  development  of new
products  based on  innovative  technologies,  including  unanticipated  delays,
expenses  and  technical  problems  or  difficulties,  as well  as the  possible
insufficiency of funds to implement  development efforts,  which could result in
abandonment or substantial  change in product  commercialization.  The Company's
success will be largely  dependent upon its products  meeting  targeted cost and
performance objectives of large-scale production, the Company's ability to adapt
its products to satisfy  industry  standards and the timely  introduction of its
products into the  marketplace,  among other  things.  There can be no assurance
that,  upon  wide-scale  commercial  introduction,  the  Company's  products and
software applications will satisfy current price or performance objectives, that
unanticipated  technical or other problems which would result in increased costs
or material delays in introduction and commercialization will not occur, or that
the Company's  products will prove to be sufficiently  reliable or durable under
actual operating  conditions or otherwise be commercially  viable.  Software and
other  technologies as complex as those  incorporated into the Company's systems
may contain  errors which become  apparent  subsequent to widespread  commercial
use. Remedying such errors could delay the Company's plans and cause it to incur
additional costs, having a material adverse impact on the Company. See "Business
- -- Products" and "-- Marketing and Sales."

   
   Concentration  of Revenue;  Dependence  on Key  Customers;  Concentration  of
Credit Risk. A substantial  portion of the  Company's  sales are made to a small
number of  customers,  generally  on an open  account  basis with no  collateral
required.  There can be no assurance  that these  customers  will maintain their
volume of business  with the  Company.  A loss of the  Company's  sales to these
customers  could  have a material  adverse  effect on the  Company's  results of
operations unless other customers were found to provide the Company with similar
revenues.  The Company performs  ongoing credit  evaluation of its customers and
maintains  reserves for  potential  credit  losses.  Although such losses in the
aggregate have not exceeded management's expectations, there can be no assurance
that  potential  credit  losses  will not  exceed  reserves  in the  future.  In
addition,  the Company invests its cash and cash  equivalents with two financial
institutions,  one a Texas  commercial  bank,  and the  other a major  brokerage
house.  Cash  balances at the Texas  commercial  bank are insured by the Federal
Deposit  Insurance  Corporation up to $100,000 and the brokerage house maintains
accounts in several banks  throughout the country and in government  securities.
Should either the Texas  commercial  bank or the brokerage  house cease business
operations,  there can be no assurance  that the Company will not suffer losses.
See "Management's  Discussion and Analysis of Financial Condition and Results of
Operations."

   Uncertainty  of Market  Acceptance.  The DVC  industry  is  characterized  by
emerging and evolving  markets and an increasing  number of market  entrants who
have  introduced or are  developing  an array of new DVC systems.  Each of these
entrants is seeking to  establish  its  products as the  preferred  solution for
desktop video  applications.  As is typical in the case of emerging and evolving
markets, demand and market acceptance for newly introduced products and services
is subject to a high level of  uncertainty.  The Company  has not yet  commenced
significant  marketing  activities  relating  to product  commercialization  and
currently has limited marketing experience and limited financial,  personnel and
other resources to undertake extensive marketing activities. The Company has not
conducted and does not 
    

                                        9

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            [Alternate Page for Selling Securityholders Prospectus]


   
that the Company will be able to keep pace with the technological demands of the
marketplace or successfully enhance and adapt its products to be compatible with
newly  developed  PC  and  networking  products  and  technologies  or  software
products,  or satisfy  industry  standards  and the needs of its  consumers  and
potential  consumers.  Industry  standards  covering the Company's  products are
being established by, among others, the International  Telecommunications Union.
Such  standards  will  provide for  acceptable  product  performance  levels and
interoperability and compatibility  standards. If such standards,  when adopted,
differ from the proposed  standards,  or are changed  after  adoption,  customer
confidence  in, and the market for, the  applicable  product  could be adversely
affected.  There can be no assurance  that such  standards will remain the same,
and if  changed,  that the  Company  will be able to  comply  with  any  changed
standards.  If any product  does not comply with the  applicable  standards  the
Company may have to discontinue  sales of such product until such time, if ever,
as  it  is  able  to  modify  or  redesign  its  technology.  In  addition,  the
establishment  of  standards  adverse  to the  Company's  system  could  provide
substantial  competitive advantages to manufacturers of other  videoconferencing
systems. In particular,  the Company's compressed packet video Codec utilized in
the  current  version of the  Viewpoint-PRO(Trademark)  system does not meet the
newly  proposed  applicable  standards  and the  Company  will have to modify or
redesign the non-conforming  portion of the product.  The project to upgrade the
Viewpoint-PRO  to the new industry  standards will involve the  development of a
new product based on a technology derivative of the Company's Osprey-1000 Codec.
The Company  estimates  that the project will take 8 man-months to complete at a
cost  of  approximately   $70,000.   The  Company  projects  that  the  upgraded
Viewpoint-PRO  will be  available  during 1997.  The  Research  and  Development
portion of the Use of Proceeds includes the cost of this project.  See "Business
- -- Competition."

   Dependence Upon Third-Party  Manufacturers and Suppliers. The Company has, to
date,  engaged small  contract  manufacturers  to supply its products in limited
quantities  pursuant  to purchase  orders.  There can be no  assurance  that its
products can be  manufactured  reliably on a large-scale  basis on  commercially
reasonable terms, or at all. In addition, the Company has been and will continue
to be dependent on third  parties for the supply and  manufacture  of all of its
component  and  electronic  parts,   including   standard  and   custom-designed
components.  The Company generally does not maintain supply agreements with such
third parties but instead purchases  components and electronic parts pursuant to
purchase orders in the ordinary course of business. The Company is substantially
dependent on the ability of its  third-party  manufacturers  and  suppliers  to,
among  other  things,  meet  the  Company's  design,   performance  and  quality
specifications.
    

   Failure by the Company's  third-party  manufacturers  and suppliers to comply
with these and other  requirements  could have a material  adverse effect on the
Company. There can be no assurance that the Company's third-party  manufacturers
and suppliers will dedicate sufficient production capacity to meet the Company's
scheduled delivery requirements or that the Company's suppliers or manufacturers
will have sufficient  production capacity to satisfy the Company's  requirements
during any period of sustained demand.  Moreover,  the electronics industry from
time to time experiences short supplies of certain high demand components, which
may adversely  affect the Company's  ability to meet its  production  schedules.
Furthermore,  although  the  Company  owns the  designs  and dies for its custom
designed  components  and  believes  that  alternative  sources  of  supply  are
available,  the  Company  currently  purchases  all  of its  specially  designed
components  and certain  high  demand  components  from sole  source  suppliers.
Failure of  manufacturers  or suppliers to supply,  or delays in supplying,  the
Company with systems or components, or allocations in the supply of certain high
demand components could materially adversely affect the Company's operations and
ability to meet its own delivery  schedules on a timely and  competitive  basis.
See "Business -- Production and Supply."

   
   Broad Discretion in Application of Proceeds. Approximately $2,619,600 (31.7%)
of the estimated net proceeds  from the Company  Offering has been  allocated to
working capital and general corporate  purposes.  Accordingly,  the Company will
have broad discretion as to the application of such proceeds.  See "Management's
Discussion  and Analysis of Financial  Condition  and Results of  Operations  --
Liquidity" and "Description of Securities."

   Proceeds  to Repay  Indebtedness;  Offering  Benefits  Directors  and Selling
Securityholders.  The Company  will use a portion of the proceeds of the Company
Offering to (i) repay  $222,548  principal  amount of Secured and Demand  Notes,
including  $200,000 payable to Glenn A. Norem, CEO of the Company,  plus accrued

                                       11
    
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            [Alternate Page for Selling Securityholders Prospectus]


   
its  operations  or that  the  Company  will not  remain  largely  dependent  on
non-recurring  systems to a limited  customer base,  which sales will constitute
all or a significant portion of the Company's revenue. See "Use of Proceeds" and
"Business -- Government Regulation."

   Possible  Fluctuations in Operating Results.  The Company's operating results
could  vary from  period to  period as a result of the  length of the  Company's
sales cycle, as well as from  purchasing  patterns of potential  customers,  the
timing of  introduction  of new  products,  software  applications  and  product
enhancements  by  the  Company  and  its  competitors,   technological  factors,
variations in sales by distribution channels, competitive pricing, and generally
nonrecurring  system sales.  The Company's  sales order cycle,  which  generally
commences at a time a prospective  user  demonstrates  an interest in purchasing
one of the Company's  products and ends upon  execution of a purchase order with
that  customer,  could  range from one to eighteen  months.  The period from the
execution  of a  purchase  order  until  delivery  of system  components  to the
Company,  assembly and shipment,  at which time the Company recognizes  revenue,
may range from approximately one to four months. Although the Company intends to
use a portion of the proceeds of this offering to purchase additional  component
parts,  which the Company  believes may reduce the length of its  production and
delivery  cycle,  there can be no  assurance  that such  factors  will not cause
significant fluctuations in operating results in the future.  Additionally,  the
Company  anticipates  that upon  entering  into  agreements  with  resellers for
distribution of the Company's products, of which there can be no assurance, such
distributors may place initial stocking orders for systems,  component parts and
software  programs,  which  could also result in  material  fluctuations  in the
Company's  operating  results.  See  "Management's  Discussion  and  Analysis of
Financial  Condition and Results of Operations"  and "Business -- Production and
Supply."

   Limitations  on Use of Net  Operating  Loss Carry  Forwards.  At December 31,
1995, the Company had  substantial net operating loss carry forwards for federal
tax purposes available to offset future taxable income. Under Section 382 of the
Internal  Revenue Code of 1986, as amended,  utilization  of prior net operating
loss carry forwards is limited after an ownership  change, as defined in Section
382.  There  can be no  assurance  that the  Company  will not in the  future be
subject to further significant  limitations on the use of its net operating loss
carry forwards.  In the event the Company achieves  profitable  operations,  any
significant  limitation on the  utilization of net operating loss carry forwards
would have the effect of increasing the Company's tax liability and reducing net
income and available cash resources.  See "Management's  Discussion and Analysis
of Financial Condition and Results of Operations -- Liquidity."

   Government  Regulation.  The  Company is subject to  regulations  relating to
electromagnetic  radiation from its products, which impose compliance burdens on
the  Company.  In the event the Company  redesigns  or  otherwise  modifies  its
products or completes the  development  of new products,  it will be required to
comply with Federal  Communications  Commission regulations with respect to such
products  prior to their  commercialization.  There can be no assurance that the
Company  will be  able  to  comply  with  such  regulations.  In  addition,  new
legislation  and  regulations,  as  well  as  revisions  to  existing  laws  and
regulations at the federal, state and local levels may be proposed in the future
affecting the video communications  industries.  Such proposals could affect the
Company's  operations,  result in  material  capital  expenditures,  affect  the
marketability  of its  products  and limit  opportunities  for the Company  with
respect to  modifications  of its  products  or with  respect to new or proposed
products or  technologies.  Expansion into foreign  markets may also require the
Company  to comply  with  additional  regulatory  requirements.  The  technology
contained  in the  Company's  products may be subject to U.S.  export  controls.
There can be no assurance  that such export  controls,  either in their  current
form or as may be  subsequently  enacted,  will not  delay  introduction  of new
products or limit the Company's  ability to distribute  products  outside of the
United  States.  Further,  various  countries may regulate the import of certain
technologies  contained  in the  Company's  products.  Any such export or import
restrictions,  new  legislation  or  regulation  or  government  enforcement  of
existing  regulations  could have a  material  adverse  effect on the  Company's
business,  operating  results  and/or  financial  condition.  There  can  be  no
assurance  that the Company  will be able to comply with  additional  applicable
laws and regulations without excessive cost or business interruption, if at all,
and failure to comply could have a material  adverse effect on the Company.  See
"Business -- Government Regulation."

   Dependence  on Key  Personnel.  The  success of the  Company  will be largely
dependent  on the  personal  efforts  of Glenn A.  Norem,  its  Chief  Executive
Officer,  and  other  key  personnel.  The  Company  

                                13
    

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            [Alternate Page for Selling Securityholders Prospectus]


   
entered into a five-year  employment  agreement with Mr. Norem in February 1994.
All  other  key  personnel,  including  Philip M.  Colquhoun,  President  of the
Company,  William S. Leftwich,  Chief Financial Officer of the Company, David T.
Stoner,  Vice  President  of  Operations  of the  Company,  Neal S.  Page,  Vice
President and General Manager of Osprey,  A. David Boomstein,  Vice President of
Business  Development  of the Company and Daniel W.  Dodson,  Vice  President of
Marketing of the Comapny,  are "at-will"  employees by terms of their employment
agreements. The employment of each such key employee may therefore be terminated
by the officer or the Company at any time, for any reason or no reason. The loss
of the  services  of Mr.  Norem or  certain  other key  employees  could  have a
material  adverse effect on the Company's  business and  prospects.  The Company
plans to obtain  "key-man" life insurance on the life of Mr. Norem in the amount
of $1,000,000.  The success of the Company is also dependent upon its ability to
hire and retain qualified operational,  financial,  technical,  marketing, sales
and other personnel.  There can be no assurance that the Company will be able to
hire or retain  such  necessary  personnel.  See  "Business  --  Employees"  and
"Management."

   Control by Current Principal  Stockholders;  Potential Underwriters Influence
on the  Company  Upon  Exercise of Right to  Designate  Board  Member.  Upon the
consummation  of the Company  Offering,  the  officers,  directors  and existing
stockholders of the Company will  beneficially  own  approximately  75.4% of the
Company's outstanding Common Stock (72.8% if the Representatives' over-allotment
option is exercised in full). While these persons will not individually  control
a majority  of the shares of Common  Stock of the  Company,  they may be able to
effectively  control the decisions on matters  including  election of all of the
Company's  directors,  increasing  the authorized  capital  stock,  dissolution,
merger or sale of the assets of the Company and  generally may be able to direct
the affairs of the Company. In addition,  upon consummation of the offering, the
Representative  has been  granted,  for a period  of five  years,  the  right to
designate a person to serve as a director of the Company.  If the Representative
were to exercise such right, it could be deemed under certain  circumstances  to
be in a  position  to  assert  influence  over the  Company.  See  "Management,"
"Principal Stockholders" and "Certain Transactions."

   Significant  Outstanding Options and Warrants. As of September 30, 1996 there
were  outstanding  stock  options to  purchase  an  aggregate  of  approximately
2,080,590  shares of Common Stock at exercise  prices ranging from $.04 to $4.00
per share and  warrants to  purchase an  aggregate  of  approximately  1,442,505
shares of Common Stock at prices  ranging from $1.00 to $3.00 per share.  To the
extent that  outstanding  options and  warrants are  exercised,  dilution to the
Company's  stockholders will occur.  Moreover,  the terms upon which the Company
will be able to obtain  additional  equity  capital  may be  adversely  affected
because  the holders of  outstanding  options  and  warrants  can be expected to
exercise them at a time when the Company would,  in all  likelihood,  be able to
obtain  any  needed  capital on terms more  favorable  to the  Company  than the
exercise  terms  provided by such  outstanding  securities.  See  "Management --
Employee Stock Plans" and "Certain Transactions."

   Immediate and Substantial  Dilution.  Assuming all 1,800,000 shares of Common
Stock offered  hereby are sold at an assumed  initial  public  offering price of
$5.50 per share and $0.10 per Public Warrant,  the Company Offering will involve
an immediate and substantial dilution of $4.69 (85.3%) per share between the pro
forma net tangible book value per share of Common Stock and the offering  price.
The Company  believes  that the net  proceeds  of this  offering  together  with
available cash will be sufficient to meet the Company's  operating  expenses and
capital   requirements  for  at  least  the  next  twelve  months.  The  Company
anticipates  that  additional  funding will be required after the use of the net
proceeds of this offering. Such additional funding will likely result in further
dilution to the Company's stockholders.
See "Dilution."

   No Dividends. The Company has not paid any cash dividends on its Common Stock
and does not  expect to  declare or pay any cash  dividends  in the  foreseeable
future.  Certain of the Company's debt instruments include covenants  precluding
the payment of cash dividends until after such debt instruments are repaid.  See
"Dividends."

   Authorization  and  Discretionary  Issuance of Preferred Stock. The Company's
Certificate of Incorporation  authorizes the issuance of "blank check" preferred
stock with such  designations,  rights and preferences as may be determined from
time to time by the Board of Directors.  Accordingly,  the Board      

                                       14

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of Directors is empowered,  without  stockholder  approval,  to issue  preferred
stock with dividend, liquidation, conversion, voting or other rights which could
adversely affect the voting power or other rightsof the holders of the Company's
Common Stock.  In the event of issuance,  the preferred stock could be utilized,
under certain circumstances, as a method of discouraging, delaying or preventing
a change  in  control  of the  Company.  Although  the  Company  has no  present
intention to issue any shares of its preferred stock,  there can be no assurance
that the Company will not do so in the future. See "Description of Securities --
Preferred Stock."

   Limitation on Monetary  Liability of Officers and Directors to  Stockholders.
Section 145 of the  General  Corporation  Law of the State of Delaware  contains
provisions  entitling  directors and officers of the Company to  indemnification
from  judgments,  fines,  amounts paid in settlement  and  reasonable  expenses,
including  attorney's  fees,  as the result of an action or  proceeding in which
they may be  involved by reason of being or having been a director or officer of
the Company  provided said officers or directors  acted in good faith.  Articles
Seven and Ten of the Company's  Certificate of Incorporation  contain provisions
indemnifying  officers  and  directors  of the  Company  to the  fullest  extent
permitted by Delaware law. These provisions provide,  among other things, that a
director  of the  Company  shall not be  liable  either  to the  Company  or its
stockholders  for monetary  damages for breach of fiduciary  duty as a director.
The Company has also entered into indemnification agreements with Messrs. Norem,
Leftwich,  Colquhoun,  Stoner,  Dodson,  Boomstein,  Page,  Jobe, and Culp which
provide for  indemnification  to the fullest extent  allowable under the laws of
the State of Delaware.  These  provisions may limit the ability of the Company's
stockholders to collect on any monetary  liability owed to them by an officer or
director of the Company.

   Arbitrary  Determination of Offering Price. The initial public offering price
of the Common Stock and the exercise price and terms of the Public Warrants have
been  determined  arbitrarily  by  negotiations  between  the  Company  and  the
Representatives.  Factors  considered  in  such  negotiations,  in  addition  to
prevailing  market  conditions,  included  the  history  and  prospects  for the
industry  in  which  the  Company  competes,  an  assessment  of  the  Company's
management,  the  prospects of the Company,  its capital  structure  and certain
other factors  deemed  relevant.  Therefore,  the public  offering  price of the
Common  Stock and the  exercise  price and terms of the Public  Warrants  do not
necessarily bear any relationship to established  valuation criteria and may not
be indicative of prices that may prevail at any time or from time to time in the
public market for the Common Stock. See "Underwriting."

   Shares Eligible for Future Sale;  Registration  Rights. Upon the consummation
of the Company Offering,  the Company will have 7,331,558 shares of Common Stock
outstanding  (7,601,558 shares if the Representatives'  over-allotment option is
exercised in full)(assuming no exercise of outstanding options and warrants). Of
these  shares,  the  1,800,000  shares sold in the Company  Offering  (2,070,000
shares if the Representatives'  over-allotment  option is exercised in full) and
the 477,244 shares of Common Stock registered  concurrently with this Prospectus
being offered pursuant to the Selling Securityholder  Prospectus included in the
Registration  Statement  of which  this  Prospectus  forms a part will be freely
tradeable,  subject to "lock-up"  agreements  (see  "Shares  Eligible for Future
Sale"),  under  the  Securities  Act,  except  for any  shares  purchased  by an
"affiliate" of the Company (in general, a person who has a control  relationship
with the  Company),  which shares will be subject to the resale  limitations  of
Rule 144 adopted under the Securities  Act. The remaining  5,054,314  shares are
deemed to be  "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 and are
not  currently  part  of  an  effective   registration.   Except  for  "lock-up"
agreements,  such shares are eligible for sale under Rule 144, or will become so
eligible at various  times through  October  1996. In addition,  the Company has
granted  the  Representatives  demand and  piggyback  registration  rights  with
respect  to the  securities  issuable  upon  exercise  of  the  Representatives'
Warrants.

   Under Rule 144, a stockholder who has beneficially  owned  Restricted  Shares
for  at  least  two  (2)  years  (including  persons  who  may be  deemed  to be
"affiliates"  of the Company under Rule 144) may sell within any three (3) month
period a number of shares  that does not exceed the  greater  of: a) one percent
(1%) of the then  outstanding  shares  of a  particular  class of the  Company's
Common Stock as reported on its 10-Q filing,  or b) the average weekly volume on
NASDAQ during the four (4) calendar weeks  preceding such sale and may only sell
such shares through unsolicited brokers' transactions.  A stockholder who is not
deemed to have been an "affiliate" of the Company for at least ninety (90) days

                                       15

    


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            [ALTERNATE PAGE FOR SELLING SECURITYHOLDERS PROSPECTUS]

                                 USE OF PROCEEDS

   

   The Company will not receive any of the proceeds  from the sale of the Shares
of Common  Stock and Public  Warrants  by the  Selling  Securityholders.  To the
extent that the Public Warrants are exercised, the Company will receive proceeds
represented by the exercise price of the Public  Warrants.  In addition,  to the
extent that the Public Warrants are exercised, the Company will receive proceeds
represented by the exercise price of the Public Warrants. Any such proceeds will
be added to the Company's working capital.  The net proceeds to the Company from
the sale of the 1,800,000  shares of Common Stock and 1,800,000  Public Warrants
offered  pursuant to the Company Offering (based on an assumed offering price of
$5.50 per share of Common Stock and $.10 per Public Warrant) are estimated to be
approximately $8,269,600 ($9,585,040 if the over-allotment option granted to the
Underwriter of the Company  Offering is exercised in full).  The Company expects
to use such proceeds (assuming no exercise of the over-allotment  option granted
to the Representatives of the Company Offering) as follows:

    
<TABLE>
<CAPTION>
                                                                APPROXIMATE

                 APPLICATION OF NET PROCEEDS                   DOLLAR AMOUNT    % OF PROCEEDS

- ------------------------------------------------------------  --------------- ----------------
<S>                                                           <C>             <C>
Repayment of outstanding accounts payable and
indebtedness(1).............................................  $2,490,000       30.1
Research and development(2) ................................   1,960,000       23.7
Marketing and sales(3) .....................................   1,200,000       14.5
Working capital and general corporate purposes(4)  .........   2,619,600       31.7
                                                              --------------- ----------------
   Total ...................................................  $8,269,600      100.0
                                                              =============== ================
</TABLE>
   
(1)  Represents (i) the repayment of $222,548  principal amount of Secured Notes
     and Demand Notes plus accrued interest of approximately $13,933,  including
     $200,000  principal  amount of Secured  Notes and Demand  Notes  payable to
     Glenn A.  Norem,  CEO of the  Company,  a  partnership  he  controls;  (ii)
     repayment of $347,250  principal  amount of  Convertible  Debt plus accrued
     interest of $97,898,  (iii) payment of accrued  expenses and trade accounts
     payable of  approximately  $420,000,  (iv) repayment of $500,000  principal
     amount  of  Convertible  Debt II plus  accrued  interest  of  approximately
     $31,123 and (v) repayment of $850,000  principal amount of Bridge Debt plus
     accrued interest of approximately $6,641. See "Management's  Discussion and
     Analysis of Financial Condition and Results of Operations -- Liquidity" and
     "Description of Securities."
              

(2)  Includes  amounts  associated with continued  refinement and enhancement of
     the  Company's  products and amounts  associated  with the  development  of
     additional products.

(3)  Represents   anticipated   costs   associated   with  marketing  and  sales
     activities,  including  approximately $250,000 for the cost of print media,
     participation in trade shows and direct mailings and approximately $400,000
     for the salaries of four additional marketing and sales personnel and three
     additional customer support personnel.

(4)  Includes  amounts  for  the  payment  of  salaries  of  executive  officers
     anticipated  to be  approximately  $385,000  over the 12  months  following
     consummation of this offering. See "Management," "Certain Transactions" and
     "Business -- Production and Supply."

   In the event that the  Company's  plans change or its  assumptions  change or
prove  to be  inaccurate  or if the  proceeds  of  the  Company  Offering  prove
insufficient to fund operations (due to  unanticipated  expenses or difficulties
or otherwise), the Company may find it necessary or advisable to reallocate some
of the proceeds within the above-described categories or to use portions thereof
for other  purposes or may be required to seek  additional  financing or curtail
its  operations.  Future  events,  including  changes in  economic  or  industry
conditions or the Company's planned  operations,  may require the Company to use
proceeds  allocated to working  capital for  marketing  and sales or  reallocate
proceeds  among the various  intended  uses if it is  determined at a later date
that an increase in such  expenditures  or reallocation of proceeds is necessary
or  desirable.  Any such  determination  would be based on, among other  things,
whether and to what extent  revenue from systems  sales is  sufficient to offset
operating expenses and the capital  requirements  associated with maintaining an
inventory of system components.  Alternatively,  the Company may use less of the
proceeds for  marketing  and sales in the event that such initial  efforts prove
more successful than anticipated or the Company  generates  sufficient cash flow
from operations to otherwise fund such efforts.

                                       18
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            [ALTERNATE PAGE FOR SELLING SECURITYHOLDERS PROSPECTUS]

   The Company  may, if and when the  opportunity  arises,  use a portion of the
proceeds of the Company Offering allocated to working capital, together with the
issuance of debt or equity  securities,  to acquire rights to technology  and/or
products or to acquire existing companies in businesses the Company believes are
compatible with its business.  Any decision to make such an acquisition  will be
based upon a variety of factors, including, among others, the purchase price and
other financial terms of the transaction, the business prospects and competitive
position of, and technology or products  provided by, the acquisition  candidate
and the extent to which any  technology or business  would enhance the Company's
prospects.  Potential acquisition candidates may include companies with products
or  technologies  that are compatible with the Company's  products,  or that the
Company  believes  would  provide  the  Company  with  additional   distribution
channels.  As of the date of this  Prospectus,  the Company  has no  agreements,
understandings or arrangements  with respect to any such acquisition.  There can
be no assurance  that the Company will be able to  successfully  consummate  any
acquisition or successfully integrate any acquired business into its operations.
Investors in this offering will not have an opportunity to evaluate the specific
merits or risks of any acquisition.

   The Company believes that the net proceeds of the Company  Offering  together
with available cash will be sufficient to meet the Company's  operating expenses
and  capital  requirements  for at least the next  twelve  months.  The  Company
anticipates  that  additional  funding will be required after the use of the net
proceeds  of the  offering.  No  assurance  can be given  that  such  additional
financing will be available when needed on terms  acceptable to the Company,  if
at all. See "Risk Factors --  Significant  Capital  Requirements;  Dependence on
Offering Proceeds; Possible Need for Additional Financing."

   Proceeds  not  immediately  required for the purposes set forth above will be
invested in short-term, investment-grade, interest-bearing securities.

                                    DIVIDENDS

   The Company has never paid cash  dividends on its Common Stock.  The Board of
Directors does not anticipate paying cash dividends in the foreseeable future as
it intends to retain future earnings to finance the growth of the business.  The
payment of future cash dividends will depend on such factors as earnings levels,
anticipated capital  requirements,  the operating and financial condition of the
Company and other factors deemed relevant by the Board of Directors.

   Certain  of the  Company's  debt  instruments  include  covenants  precluding
payment of cash dividends until after such debt instruments are repaid.

                                       19

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                                       20

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                                       21

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                                 CAPITALIZATION

   The  following  sets forth the  capitalization  of the Company as of June 30,
1996 (A) on an actual  basis,  (B) pro forma to reflect  transactions  occurring
after  June 30,  1996 but before the date of this  Prospectus  consisting  of 1)
receipt of stock subscription  receivable of $220,000, 2) issuance of $1,000,000
aggregate  principal  amount of Convertible Debt II and (3) issuance of $500,000
aggregate  principal  amount of Bridge  Debt and (C) pro  forma as  adjusted  to
reflect  the  issuance  and sale of shares of Common  Stock and Public  Warrants
offered  pursuant to the Company Offering (based on an assumed offering price of
$5.50 per share and $.10 per Public  Warrant);  and the initial  application  of
estimated net proceeds therefrom.

<TABLE>
<CAPTION>

                                                                           JUNE 30, 1996

                                                           --------------------------------------------
                                                                                            PRO FORMA

                                                                                               AS

                                                               ACTUAL        PRO FORMA     ADJUSTED(1)

                                                           -------------- -------------- --------------
<S>                                                        <C>            <C>            <C>
Short-term debt..........................................  $  3,293,775   $  4,293,775   $    295,100
                                                           ============== ============== ==============
Long-term debt...........................................  $      3,780   $    503,780   $    503,780
                                                           -------------- -------------- --------------
Stockholders' equity:

Preferred stock, $.0001 par value, 5,000,000 shares
 authorized, none issued or outstanding..................            --             --             --
 Common Stock, $.0001 par value, 20,000,000 shares 
 authorized;  5,315,811 shares issued  (actual),  
 5,315,811  shares issued (pro forma) and  7,593,055  
 shares issued (pro forma as adjusted)...................           532            532            760
 Additional paid-in capital..............................     6,192,572      6,412,572     17,469,538
 Accumulated deficit.....................................   (10,036,220)   (10,036,220)   (10,036,220)
 Treasury stock, 261,497 shares, at cost.................       (11,906)       (11,906)       (11,906)
                                                           -------------- -------------- --------------
Total stockholders' equity (deficit).....................    (3,855,022)    (3,635,022)     6,399,247
                                                           -------------- -------------- --------------
Total capitalization.....................................  $ (3,851,242)  $ (3,131,242)  $  6,899,247
                                                           ============== ============== ==============
</TABLE>

   
- ----------

(1)   Includes 477,244 shares of Common Stock and 477,244 Public Warrants issued
      on the date of this Prospectus upon the conversion of $2,330,300 principal
      amount of Convertible Debt and approximately  $342,294 of accrued interest
      (based on an assumed offering price of $5.50 per share and $.10 per Public
      Warrant).  Does not include (i) 1,442,505  shares of Common Stock reserved
      for issuance  upon  exercise of  outstanding  warrants to purchase  common
      stock,  (ii)  180,000  shares of Common Stock  reserved for issuance  upon
      exercise of the Representative's  Warrants, (iii) 180,000 shares of Common
      Stock  reserved  for issuance  upon  exercise of  Representative's  Public
      Warrants issuable upon exercise of Representatives' Warrants, (iv) 957,975
      shares of Common  Stock  reserved for  issuance  upon  exercise of options
      available  for future  grant under the 1995  Option  Plan,  (v)  1,042,025
      shares of Common  Stock  reserved for  issuance  upon  exercise of options
      granted  under the 1995 Option Plan,  (vi) 906,749  shares of Common Stock
      reserved  for issuance  upon  exercise of options  granted  under the 1994
      Option Plan,  (vii) 103,549  shares of Common Stock  reserved for issuance
      upon exercise of options granted under the 1993 Option Plan, (viii) 25,000
      shares of Common  Stock  reserved for  issuance  upon  exercise of options
      granted under the 1995 Directors Stock Option Plan, (ix) 225,000 shares of
      Common Stock reserved for issuance upon exercise of options  available for
      future  grant under the 1995  Directors  Stock  Option  Plan,  (x) 250,000
      shares of Common  Stock  reserved for  issuance  under the Employee  Stock
      Purchase Plan, (xi) 1,280,900 shares of Common Stock reserved for issuance
      upon exercise of the Convertible Debt Warrants, and (xii) 1,800,000 shares
      of  Common  Stock  reserved  for  issuance  upon  exercise  of the  Public
      Warrants. See "Management's Discussion and Analysis of Financial Condition
      and  Results  of  Operations,"   "Management  --  Employee  Stock  Plans,"
      "Description   of   Securities  --   Convertible   Debt   Financing"   and
      "Underwriting."     

                                       22

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   Selling,   General  and   Administrative   Expense.   Selling,   general  and
administrative  expense  increased  $502,012  to  $2,297,497  for the year ended
December 31, 1995.  This 28.0% increase over the prior year can be attributed to
increases in employees and  consultants,  higher  occupancy  costs and increased
business development,  sales and marketing related expenses corresponding to the
introduction  of  the  Viewpoint-PRO(Trademark),  Viewpoint  VBX(Trademark)  and
Osprey-1000(Trademark)  product lines in 1995. The Viewpoint  VBX(Trademark) and
Osprey-1000(Trademark) products were still undergoing customer evaluation at the
end of 1995.

   Research and  Development  Expense.  The Company's  research and  development
expense   increased   $1,118,463  to  $1,983,310  in  1995   primarily  due  the
establishment  of the Company's  North  Carolina  development  office.  Expenses
related to this office  included  salaries for newly hired engineers and support
staff  and the  cost  of  office  facility  and  equipment.  During  1995,  this
development office was engaged in the development of the  Osprey-1000(Trademark)
and  SLIC-Video(Trademark)   products  introduced  in  late-1995  and  mid-1995,
respectively.

   Other Income  (Expense).  For the year ended December 31, 1995,  other income
(expense)  increased to  ($843,292)  for the year  compared to ($39,897) for the
year ended  December 31, 1994.  This  increase  was  primarily  the result of an
approximate  $766,402  increase  in interest  expense  for 1995 over 1994,  as a
result of additional  borrowings pursuant to the Convertible Debt and borrowings
pursuant to the Secured Notes and Demand Notes. See "Certain Transactions."

LIQUIDITY

   At June 30, 1996, the Company had a working capital deficit of  $(4,483,604).
To  date,  the  Company  has  been  dependent  upon  loans  from  its  principal
stockholders,  as well as private  placements of its debt and equity securities,
to finance its working capital requirements.

   Net cash used in operating  activities for the six months ended June 30, 1996
was $1,399,250.  Increases in inventory and accounts payable were a result of an
increase in production levels to meet anticipated sales.

   Cash used in  investing  activities  for the six months  ended June 30,  1996
consisted of $85,901 of capital expenditures. As of the date of this Prospectus,
the Company does not have any material commitments for capital expenditures.

   Cash provided by financing  activities for the six months ended June 30, 1996
was primarily a result of the receipt of the proceeds of the Secured Notes II in
January through  February 1996 and the private  placement of Common Stock during
the second quarter of 1996. At June 30, 1996, the Company had cash of $54,072

   The Company currently has no plans or agreements to seek loan financing.  The
Company may choose to seek additional  financing to provide  additional  working
capital at sometime in the future.  Such financing may include loans or lines of
credit and could include  factoring  agreements.  However,  the Company believes
that the proceeds of the initial public  offering will be sufficient to meet its
capital requirements for the next twelve months.

   The Company's  independent auditors have included an explanatory paragraph in
their audit report on the Company's  consolidated  financial  statements stating
that certain  factors raise  substantial  doubt about the  Company's  ability to
continue as a going  concern.  The Company  Offering is an integral  part of the
Company's plan to continue as a going  concern.  In the event that the Company's
plans  change  or its  assumptions  change or prove to be  inaccurate  or if the
proceeds of the Company  Offering prove to be  insufficient  to fund  operations
(due to unanticipated expenses or difficulties or otherwise), the Company may be
required to seek additional  financing  sooner than currently  anticipated.  The
Company has no current  arrangements  with respect to, or sources of, additional
financing. There can be no assurance that existing stockholders will provide any
portion  of  the  Company's  future  financing  requirements.  There  can  be no
assurance  that any  additional  financing  will be  available to the Company on
acceptable terms, or at all. Additional equity financing may involve substantial
dilution to the Company's then existing stockholders.

                                       25

<PAGE>
            [ALTERNATE PAGE FOR SELLING SECURITYHOLDERS PROSPECTUS]

                            PRINCIPAL STOCKHOLDERS

   

   The following  table sets forth  information  as of September 30, 1996 and as
adjusted to reflect the sale of Common Stock offered by the Company  pursuant to
the Company  Offering,  based on  information  obtained  from the persons  named
below, with respect to the beneficial ownership of shares of Common Stock by (i)
each  person or a group  known by the Company to be the owner of more than 5% of
the outstanding shares of Common Stock, (ii) each director, (iii) each executive
officer named in the Summary Compensation Table under the caption  "Management",
and (iv) all officers and directors as a group.     

<TABLE>
<CAPTION>

                                           AMOUNT AND                        PERCENTAGE OF OUTSTANDING
                                           NATURE OF                           SHARES OWNED(2)(3)
       NAME AND ADDRESS                    BENEFICIAL                     -------------------------------
    OF BENEFICIAL OWNER(1)                 OWNERSHIP(2)                    PRIOR TO                     
    ----------------------                ------------                     OFFERING        AFTER OFFERING  
                                                                           
<S>                                      <C>                                <C>               <C>    
Fred Kassner ...................         1,375,242(4)                        15.0              12.6     
 69 Spring Street                                                                                       
Ramsey, NJ 07446                                                                                        
                                                                                                        
Robert Moody, Jr. ..............         1,086,531(5)                        11.9              9.9      
 601 Moody National Bank Bldg.                                                                          
 Galveston, TX 77550 ...........                                                                        
                                                                                                        
H.T. Ardinger, Jr. .............         1,047,455(6)                        11.5              9.6      
 9040 Governors Row                                                                                     
 Dallas, TX 75247                                                                                       
                                                                                                        
Glenn A. Norem .................           835,148(7)                         9.1              7.6      
M. Douglas Adkins...............           688,759(8)                         7.5              6.3      
 1601 Elm Street, #3000                                                                                 
 Dallas, TX 75201                                                                                       
                                                                                                        
Robert Sterling Trust ..........           532,059(9)(10)                     5.8              4.9      
 c/o Thomas E. Brown                                                                                    
 1715 West 35th Street                                                                                  
 Pine Bluff, AR 71603                                                                                   
                                                                                                        
Robert Bernardi Trust...........           430,394(11)                        4.7              3.9      
 c/o Richard Bernardi                                                                                   
 440 Wood Crest Road                                                                                    
 Stratford, PA 19087                                                                                    
                                                                                                        
William D. Jobe.................            84,414(12)                          *               *       
William S. Leftwich ............            40,000(13)                          *               *       
Joe C. Culp ....................            19,930(14)                          *               *       
Philip M. Colquhoun.............            46,666(15)                          *               *       
David T. Stoner.................                -- 16)                          *               *       
All officers and directors as a                                                                         
 group (nine persons)...........         1,129,870(7)(12)(13)(14)(15)(16)(17) 12.4            10.3      
                                                                                                        
</TABLE>                                

   Messrs.  Sterling and Bernardi may be deemed to be "founders" of the Company,
as such term is defined under the federal securities laws.

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

(1)   Unless  otherwise  indicated,  the address of each  individual  is c/o the
      Company, 2665 Villa Creek Drive, Dallas, Texas 75234.

(2)   A person is deemed to be the  beneficial  owner of securities  that can be
      acquired  by such person  within 60 days from the date of this  Prospectus
      upon  the  exercise  of  warrants  or  options.  Each  beneficial  owner's
      percentage  ownership is  determined  by assuming that options or warrants
      that are held by such person (but not those held by any other  person) and
      which are exercisable within 60 days from the date of this Prospectus have
      been exercised.  Unless otherwise indicated, the Company believes that all
      persons  named in the table  have sole  voting and  investment  power with
      respect to all shares of Common Stock beneficially owned by them.

(3)   Based on a total of (i)  5,054,314  shares  issued and  outstanding,  (ii)
      470,649 shares of Common Stock issued on the date of this  Prospectus upon
      the  conversion of $2,330,300  principal  amount of  Convertible  Debt and
      approximately  $305,362  accrued  interest  (based on an assumed  offering
      price of $5.50 per share and $.10 per  Public  Warrant),  (iii)  1,392,505
      shares of Common Stock  reserved for issuance upon exercise of outstanding
      warrants to purchase common stock, (iv) 1,280,900 shares

                                       44

<PAGE>

             [ALTERNATE PAGE FOR SELLING SECURITYHOLDERS PROSPECTUS]
   

      of Common Stock  reserved for issuance  upon  exercise of the  Convertible
      Debt Warrants and (v) 888,196 shares of Common Stock reserved for issuance
      upon exercise of vested stock  options as of September 30, 1996.  Does not
      include (i) 180,000  shares of Common Stock  reserved  for  issuance  upon
      exercise of the Underwriters' Warrants, and 180,000 shares of Common Stock
      reserved for issuance upon exercise of Underwriters' Public Warrants.  See
      "Management's  Discussion and Analysis of Financial  Condition and Results
      of  Operations,"  "Management  -- Employee Stock Plans,"  "Description  of
      Securities" and "Underwriting."

(4)   Includes (i) 35,714  shares  issuable upon the  conversion of  Convertible
      Debt to  equity,  (ii)  100,000  shares  issuable  at $3.00 per share upon
      exercise  of  warrants   issued  in  connection  with  the  conversion  of
      Convertible  Debt to equity,  (iii)  65,000  shares  issuable at $3.00 per
      share upon exercise of warrants  issued in connection  with the conversion
      of Secured Notes II to equity,  (iv) 100,000 shares  issuable at $3.00 per
      share upon exercise of warrants  issued in connection with the Convertible
      Debt II.

(5)   Includes (i) 250,000 shares  beneficially  owned by Moody Insurance Group,
      Inc., of which Mr. Moody is Chairman,  President and the sole stockholder,
      (ii)  warrants to  purchase  200,000  shares at $1.00 per share  issued in
      connection  with the exchange of a Secured Note for equity,  (iii) 114,280
      shares  issuable  upon the  conversion  of  Convertible  Debt and  accrued
      interest to equity,  and (iv) warrants to purchase 275,000 shares at $3.00
      per share issued in connection with the conversion of Convertible  Debt to
      equity.

(6)   Includes (i) 54,501 shares owned by Mr.  Ardinger's wife, (ii) warrants to
      purchase  120,000 shares at $1.00 per share issued in connection  with the
      exchange of a Secured  Note and a Demand  Note for equity,  held by either
      Mr.  Ardinger or his wife,  (iii)  warrants to purchase  375,000 shares at
      $3.00 per share issued in connection  with the  conversion of  Convertible
      Debt to equity,  (iv)  155,953  shares  issuable  upon the  conversion  of
      Convertible  Debt and accrued  interest to equity,  and (v) 37,500  shares
      issuable at $1.00 per share granted for the issuance of a Demand Note.

(7)   Includes (i) 51,100 shares issuable at $.04 per share upon the exercise of
      options issued under the 1993 Option Plan,  (ii) 95,333 shares issuable at
      $2.42 per share upon  exercise  of options  issued  under the 1994  Option
      Plan,  (iii) 75,000  shares  issuable at $1.00 per share upon  exercise of
      warrants granted for the exchange of a Secured Note for a Demand Note, and
      (iv) 16,667  shares  issuable at $3.00 per share upon exercise of warrants
      issued for the repayment of Convertible Debt.

(8)   Includes (i) 25,000  shares  issuable at $1.00 per share upon the exercise
      of warrants granted for the issuance of a Demand Note, (ii) 145,500 shares
      issuable at $1.00 per share upon the  exercise  of warrants in  connection
      with the  exchange  of a Secured  Note for  equity,  (iii)  50,000  shares
      issuable at $1.00 per share upon exercise of warrants in  connection  with
      the exchange of a Demand Note for equity, (iv) 63,388 shares issuable upon
      the conversion of Convertible  Debt and accrued interest to equity and (v)
      152,500  shares  issuable at $3.00 per share upon the exercise of warrants
      in connection with the conversion of Convertible Debt to equity.     

(9)   Shares subject to the control of Thomas E. Brown, as voting trustee of the
      Robert Sterling Trust.  On January 24, 1995,  Robert M. Sterling,  Jr. and
      Thomas E. Brown, as voting trustee,  entered into a Voting Trust Agreement
      covering  all  capital  stock  beneficially  owned by Mr.  Sterling  as of
      January  24,  1995  or  subsequently   acquired.  The  voting  trustee  is
      entitled,in his  discretion,  to vote the shares  deposited  therewith and
      also has  exclusive  investment  control of said shares.  The Voting Trust
      Agreement is irrevocable  and expires on January 20, 1998. Mr. Sterling is
      the sole beneficiary of the Voting Trust Agreement.

   

(10)  Includes (i) 58,333  shares  issuable at $2.20 per share upon  exercise of
      options issued under the 1994 Option Plan and (ii) 16,667 shares  issuable
      at $3.00 per share for the  exercise of warrants  in  connection  with the
      repayment of Convertible Debt.

(11)  Shares  subject to the control of Richard  Bernardi,  as voting trustee of
      the Robert  Bernardi  Trust.  On January 20, 1995,  Robert P. Bernardi and
      Richard Bernardi, as voting trustee, entered into a Voting Trust Agreement
      covering  all  capital  stock  beneficially  owned by Mr.  Bernardi  as of
      January  20,  1995  or  subsequently   acquired.  The  voting  trustee  is
      entitled,in his  discretion,  to vote the shares  deposited  therewith and
      also has  exclusive  investment  control of said shares.  The Voting Trust
      Agreement is irrevocable  and expires on January 20, 1998. Mr. Bernardi is
      the sole beneficiary of the Voting Trust Agreement.

(12)  Includes (i) 60,833  shares  issuable at $3.00 per share upon the exercise
      of options  granted  under the 1994  Option  Plan and (ii)  15,555  shares
      issuable  at $3.00 per share upon  exercise of options  granted  under the
      1995  Option  Plan,  (iii)  5,110  shares  issuable at $.20 per share upon
      exercise  of options  granted  under the 1993 Plan and (iv)  2,916  shares
      issuable  at $3.00 per share upon  exercise of options  granted  under the
      1995 Directors Plan.

                                          

    

<PAGE>
   

(13)  Includes  34,000  shares  issuable at $3.00 per share upon the exercise of
      options  issued  under the 1994 Option Plan and 6,000  shares  issuable at
      $3.00 per share upon the exercise of options  issued under the 1995 Option
      Plan.

(14)  Includes  15,555  shares  issuable  at $3.00 per share  upon  exercise  of
      options  granted  under the 1995 Option Plan and 4,375 shares  issuable at
      $3.00 per share upon exercise of options  granted under the 1995 Directors
      Plan.

(15)  Includes  46,666  shares  issuable at $3.00 share upon exercise of options
      granted under the 1995 Option Plan.

(16)  None of the  100,000  options to purchase  Common  Stock of the Company at
      $4.00 per share have vested as of the date of this Prospectus.

(17)  Includes  81,234 and 22,478 shares issuable at $3.00 per share to Mr. Page
      and Mr.  Boomstein,  respectively,  upon exercise of options granted under
      the 1994 and 1995 Option Plans.
    

                                       45

<PAGE>
             [ALTERNATE PAGE FOR SELLING SECURITYHOLDERS PROSPECTUS]

                         SHARES ELIGIBLE FOR FUTURE SALE

   
   Upon  the  consummation  of the  Company  Offering,  the  Company  will  have
7,331,558  shares  of  Common  Stock   outstanding   (7,601,558  shares  if  the
Representatives'   over-allotment  option  is  exercised  in  full)(assuming  no
exercise of outstanding  options and warrants).  Of these shares,  the 1,800,000
shares sold in the Company Offering  (2,070,000  shares if the  Representatives'
over-allotment  option is  exercised  in full) and the 477,244  shares of Common
Stock registered concurrently with this Prospectus (the "Selling Securityholders
Shares") offered hereby will be freely tradeable subject to "lock-up" agreements
described below under the Securities Act, except for any shares  purchased by an
"affiliate" of the Company (in general, a person who has a control  relationship
with the  Company),  which shares will be subject to the resale  limitations  of
Rule 144 adopted under the Securities  Act. The remaining  5,054,314  shares are
deemed to be  "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 and are
not  currently  part of an  effective  registration.  Except  for the  "lock-up"
agreement  described below, such shares are eligible for sale under Rule 144, or
will become so eligible at various times through October 1996. In addition,  the
Company has granted the Representatives demand and piggyback registration rights
with respect to the  securities  issuable upon exercise of the  Representatives'
Warrants.  No  prediction  can be made as to the effect,  if any,  that sales of
shares of Common  Stock or even the  availability  of such  shares for sale will
have on the market  prices  prevailing  from time to time. If the holders of the
shares  eligible for  registration  so choose they could  require the Company to
register all of said shares at any time.     

   In  general,   under  Rule  144  as  currently  in  effect,  subject  to  the
satisfaction of certain other  conditions,  a person,  including an affiliate of
the  Company  (or other  persons  whose  shares are  aggregated),  who has owned
restricted  shares  of  Common  Stock  beneficially  for at least  two  years is
entitled to sell,  within any three-month  period,  a number of shares 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,  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  the  three  months
immediately  preceding the sale and who has beneficially  owned shares of Common
Stock for at least three  years is  entitled to sell such shares  under Rule 144
without regard to any of the limitations described above.

   Except upon the consent of both Representatives  during the first twelve (12)
months of the term of the lock-up period and thereafter  upon the consent of one
of the  Representatives,  all executive  officers,  all directors and holders of
substantially  all of the outstanding  stock of the Company and substantally all
holders of any options, warrants or other securities convertible, exercisable or
exchangeable  for  shares  of Common  Stock  have  agreed  not to,  directly  or
indirectly,  issue,  offer,  agree or offer to  sell,  sell,  transfer,  assign,
encumber,  grant an option for the purchase or sale of,  pledge,  hypothecate or
otherwise dispose of any beneficial  interest in such securities for a period of
twenty-four  (24)  months  following  the  effective  date  of the  Registration
Statement. Holders of of the "restricted securities" have not agreed not to sell
such shares,  all of which will be eligible for sale under, and subject to, Rule
144 within three months following the date of this  Prospectus.  For a period of
two years from the date of this  Prospectus,  the Company has also agreed not to
file  any  registration  statement  relating  to the  offering  or  sale  of the
Company's  securities  (not  including any  registration  statement on Form S-8)
without the consent of the Representatives.

   Prior to this offering,  there has been no market for the Common Stock and no
prediction can be made as to the effect,  if any, that market sales of shares of
Common Stock or the availability of such shares for sale will have on the market
prices  prevailing  from  time  to  time.  Nevertheless,  the  possibility  that
substantial  amounts  of  Common  Stock  may be sold in the  public  market  may
adversely affect  prevailing market prices for the Common Stock and could impair
the  Company's  ability  to  raise  capital  through  the  sale  of  its  equity
securities.

                                       52

<PAGE>
             [ALTERNATE PAGE FOR SELLING SECURITYHOLDERS PROSPECTUS]

                SELLING SECURITYHOLDERS AND PLAN OF DISTRIBUTION

   An aggregate of up to 470,649 shares of Common Stock, 470,649 Public Warrants
and 470,649 shares of Common Stock issuable upon the exercise of Public Warrants
may  be  offered  and  sold   pursuant  to  this   Prospectus   by  the  Selling
Securityholders   from  time  to  time  as  market   conditions  permit  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
subject to "lock-up"  agreements  (See "Shares  Eligible for Future Sale").  The
Company has agreed to register such shares and warrants under the Securities Act
and  to  pay  all  expenses  in  connection   therewith  (other  than  brokerage
commissions  and fees and  expenses of counsel).  Such shares and warrants  have
been included in the  Registration  Statement of which this  Prospectus  forms a
part. Other than H.T. Ardinger,  M. Douglas Adkins,  Robert Moody, Jr., and Fred
Kassner, none of the Selling Securityholders beneficially owns 5% or more of the
Company's outstanding Common Stock. See "Principal Stockholders."

<TABLE>
<CAPTION>


                                      
                                     
                                                                                                
                                    Beneficial Ownership of Shares                               Beneficial  
                                    of Common Stock Prior to Sale           Beneficial          Ownership of 
                                    -----------------------------          Ownership of           Warrants   
                                                     Public                  Shares of        ----------------
                                        Warrant      Warrant               Common Stock       Prior to   After
Selling Securityholder      Shares       Share        Share       Total    after Sale(1)        Sale     Sale         
- ----------------------      ------       -----        -----       -----    -------------        ----     ----         
<S>                     <C>             <C>          <C>       <C>            <C>             <C>       <C>
Robert Gillings            55,171       597,650       55,171     707,992              0       652,821   597,650
A. Starke Taylor, Jr..     92,017        25,000        8,684     125,701         83,333        33,684    25,000
H.T. Ardinger, Jr. ...    489,308       532,500      130,306   1,152,114        359,002       662,806   332,883
M. Douglas Adkins ....    305,334       373,000       52,963     731,297        497,251       425,963   373,000
Robert Moody, Jr. ....    592,736       475,000       95,485   1,163,221        252,371       570,485   475,000
Fred Kassner(2).......  1,256,346       365,000      181,818   1,803,164      1,074,528       546,818   365,000
Henry Wendt...........      1,742         5,000        1,742       8,484              0         6,742     5,000
William Heim..........     17,107        50,000       17,107      84,214              0        67,107    50,000
Joseph W. Geary.......     49,908        25,000        7,575      82,483         42,333        32,575    25,000

</TABLE>

(1)   Assumes all of the Selling Securityholders' shares of Common Stock offered
      hereby are sold and no additional shares are acquired.

   The shares,  warrants, and shares underlying such warrants may be sold by one
or more of the following methods:  (a) a block trade in which a broker or dealer
so engaged  will  attempt to sell the shares  and/or  warrants  as agent but may
position  and  resell a portion  of the block as  principal  to  facilitate  the
transaction; (b) purchases by a broker or dealer as principal and resale by such
broker  or  dealer  for  its  account  pursuant  to  this  Prospectus;  and  (c)
face-to-face   transactions   between   sellers   and   purchasers   without   a
broker/dealer.  In effecting  sales,  brokers or dealers  engaged by the Selling
Securityholders  may arrange for other brokers or dealers to  participate.  Such
brokers  or  dealers  may  receive   commissions   or  discounts   from  Selling
Securityholders  in amounts to be  negotiated.  Such brokers and dealers and any
other  participating  brokers  and  dealers  may be deemed to be  "Underwriters"
within the meaning of the Securities Act in connection with such sales.

                                       53

<PAGE>
            [ALTERNATE PAGE FOR SELLING SECURITYHOLDERS PROSPECTUS]





                     [THIS PAGE INTENTIONALLY LEFT BLANK]

                                       54

<PAGE>

            [ALTERNATE PAGE FOR SELLING SECURITYHOLDERS PROSPECTUS]



                     [THIS PAGE INTENTIONALLY LEFT BLANK]

                                       55

<PAGE>

            [ALTERNATE PAGE FOR SELLING SECURITYHOLDERS PROSPECTUS]

                      CONCURRENT REGISTRATION OF SECURITIES

   Concurrently  with this  offering,  1,800,000  shares of  Common  Stock  (the
"Common  Stock") and  1,800,000  Public  Warrants  have been  registered  by the
Company under the  Securities  Act of 1933, as amended (the  "Securities  Act"),
pursuant to the Company Prospectus included within the Registration Statement of
which this Prospectus forms a part. The Common Stock and the Public Warrants may
not be sold prior to 24 months from the date of this  Prospectus,  in each case,
without the prior written consent of the Representatives.

                      INTEREST OF NAMED EXPERTS AND COUNSEL

   John S. Stoppelman,  a principal of The Stoppelman Law Firm, P.C., counsel to
the Company owns 42,666 shares of Common Stock of the Company,  or less than one
percent (1.0%) of the shares outstanding before this offering.

                                  LEGAL MATTERS

   The  legality of the  securities  offered  hereby will be passed upon for the
Company by The Stoppelman Law Firm, P.C., McLean, Virginia. Orrick, Herrington &
Sutcliffe  L.L.P.,  New York,  NY has acted as special  counsel to  National  in
connection with this offering. Gersten, Savage, Kaplowitz, & Curtin, L.L.P., New
York, NY has acted as counsel for the several  underwriters  in connection  with
this offering.

                                     EXPERTS

   The  consolidated  financial  statements of the Company and its  subsidiaries
(companies in the development stage) at December 31, 1995 and for the year ended
December 31, 1995, appearing in this Prospectus and Registration  Statement have
been audited by Ernst & Young LLP, independent  auditors,  as set forth in their
report thereon  appearing  elsewhere  herein,  and are included in reliance upon
such report given upon the authority of such firm as experts in  accounting  and
auditing.

   The  consolidated  financial  statements of the Company and its  subsidiaries
(companies in the development stage) at December 31, 1994 and for the year ended
December 31, 1994, appearing in this Prospectus and Registration  Statement have
been audited by Hoffman,  Morrison & Fitzgerald,  P.C. ("Hoffman"),  independent
auditors,  as set forth in their report thereon appearing  elsewhere herein, and
are included in reliance  upon such report given upon the authority of such firm
as experts in accounting and auditing.

   The  former  independent  auditor  for  the  Company,   Hoffman,  Morrison  &
Fitzgerald,  P.C.,  was dismissed by the Company on November 3, 1995.  Hoffman's
report on the financial  statements  for the fiscal year ended December 31, 1994
did not contain an adverse opinion or disclaimer of opinion,  and, except for an
emphasis paragraph  describing  substantial doubt about the Company's ability to
continue as a going concern, was not modified as to uncertainty,  audit scope or
accounting principles. Management is not aware of any disagreements with Hoffman
on any  matter  of  accounting  principles  or  practices,  financial  statement
disclosure or auditing scope or procedure through the date of dismissal,  which,
if not resolved to  Hoffman's  satisfaction,  would have caused  Hoffman to make
reference  to the subject  matter of the  disagreement  in  connection  with its
report.

                                       56

<PAGE>
 .

            [Alternate Page for Selling Securityholders Prospectus]

======================================     =====================================
     No  dealer,  salesperson  or  any
other  person has been  authorized  to
give  any  information  or to make any
representations   other   than   those
contained in this Prospectus,  and, if
given or  made,  such  information  or           MULTIMEDIA ACCESS 
representations  must not be relied on              CORPORATION
as  having  been   authorized  by  the
Company  or the  Representative.  This
Prospectus   does  not  constitute  an
offer to sell or the  solicitation  of
an  offer  to buy any  security  other
than the  securities  offered  by this
Prospectus,  or an  offer to sell or a
solicitation  of an  offer  to buy any
security   by   any   person   in  any
jurisdiction  in which  such  offer or
solicitation    would   be   unlawful.
Neither    the    delivery   of   this
Prospectus nor any sale made hereunder
shall, under any circumstances,  imply
that   the    information    in   this              477,244 SHARES
Prospectus  is  correct as of any time           OF COMMON STOCK AND
subsequent   to  the   date   of  this
Prospectus.

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

        TABLE OF CONTENTS

                                   Page
                                   ----
Prospectus Summary ................  3
Risk Factors ......................  8            477,244 REDEEMABLE
Use of Proceeds ................... 17              COMMON STOCK
Dividends.......................... 18             PURCHASE WARRANTS
Dilution .......................... 19
Capitalization .................... 21
Selected Consolidated Financial 
 Data  ............................ 22
Management's Discussion and
 Analysis of Financial Condition 
 and Results of Operations ........ 23
Business .......................... 28
Management ........................ 36
Principal Stockholders ............ 43                ----------
Certain Transactions .............. 45                PROSPECTUS
Description of Securities ......... 48                ----------
Shares Eligible for Future Sale ... 51
Underwriting ...................... 52
Concurrent Registration of 
 Securities  ...................... 55
Interest of Named Experts and 
 Counsel .......................... 55
Legal Matters ..................... 55
Experts ........................... 55
Additional Information ............ 56
Glossary ..........................  i
Index to Consolidated Financial                National Securities Corporation
 Statements .......................F-1
                                                Network 1 Financial Securities
     Until --, 1996 (25 days after the
date of this Prospectus),  all dealers
effecting    transactions    in    the
registered securities,  whether or not
participating  in  this  distribution,
may   be   required   to   deliver   a
Prospectus. This is in addition to the
obligation  of  dealers  to  deliver a
Prospectus when acting as underwriters                         , 1996

and  with   respect  to  their  unsold
allotments or subscriptions.
                     
======================================     =====================================
<PAGE>


                                   PART II
                    INFORMATION NOT REQUIRED IN PROSPECTUS

ITEM 24. INDEMNIFICATION OF DIRECTORS AND OFFICERS

   Articles Seven and Ten of the Company's Certificate of Incorporation, contain
the  following  provisions  with respect to  indemnification  of  Directors  and
Officers:

   SEVENTH.  The Corporation  shall, to the fullest extent  permitted by Section
145 of the General Corporation Law of the State of Delaware,  as the same may be
amended and supplemented, indemnify any and all persons whom it shall have power
to indemnify  under said  section from and against any and all of the  expenses,
liabilities or other matters referred to in or covered by said section,  and the
indemnification  provided for herein shall not be deemed  exclusive of any other
rights to which those  indemnified may be entitled under any By-Law,  agreement,
vote of stockholders or disinterested Directors or otherwise,  both as to action
in his official capacity and as to action in another capacity while holding such
office,  and  shall  continue  as to a person  who has  ceased  to be  director,
officer,  employee  or agent  and  shall  inure  to the  benefit  of the  heirs,
executors and administrators of such a person.

   TENTH. To the fullest extent permitted by Delaware General Corporation Law, a
director of the Corporation shall not be personally liable to the Corporation or
its  stockholders  for  monetary  damages  for  breach  of  fiduciary  duty as a
director.  Neither any amendment nor repeal of this Article, nor the adopting of
any  provision  of this  Certificate  of  Incorporation  inconsistent  with this
Article  shall  eliminate or reduce the effect of this Article in respect of any
matter  occurring,  or any cause of  action,  suit or claim  that,  but for this
Article would accrue or arise, prior to such amendment, repeal or adoption of an
inconsistent provision.

   Section 145 of the General  Corporation Law of the State of Delaware contains
provisions  entitling  directors and officers of the Company to  indemnification
from  judgments,  fines,  amounts paid in settlement  and  reasonable  expenses,
including  attorney's  fees,  as the result of an action or  proceeding in which
they may be  involved by reason of being or having been a director or officer of
the Company provided said officers or directors acted in good faith.

   The Company has also entered  into  indemnification  agreements  with Messrs.
Norem, Leftwich, Colquhoun, Jobe, and Culp which provide for the indemnification
of said officers and directors to the fullest extent allowable under the laws of
the State of Delaware.

ITEM 25. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION

               SEC Registration ............  $ 12,736
               NASD Listing Fee ............     4,000*
               NASDAQ Listing Fee ..........    10,000*
               Transfer Agent Fee ..........     3,500*
               Printing and Engraving Costs    120,000*
               Legal Fees and Expenses  ....    90,000*
               Accounting Fees and Expenses    140,000*
               Blue Sky Fees and Expenses  .    50,000*
               Miscellaneous ...............    69,764*
                                             ----------
                  TOTAL ....................  $500,000
                                             ==========
- ----------
* Estimated.

                                      II-1

<PAGE>

ITEM 26. RECENT SALES OF UNREGISTERED SECURITIES

   The  following  shares of Common Stock were issued by the Company  during the
past three years without  registering  the securities  under the Securities Act.
There were no underwriting  discounts or commissions paid in connection with the
issuance of any of said securities, except as noted.

   The sales of the  securities  described in the  following  table were made in
reliance upon Section 4(2) of the Securities Act, which provides  exemptions for
transactions  not involving a public  offering,  to the founders of the Company.
With regard to the  Company's  reliance  upon the  exemption  from  registration
provided  by  Section  4(2) of the  Securities  Act of the  sale  of  securities
described  below,  certain  inquiries were made by the Company to establish that
such sales qualified for such exemption.  In particular,  the Company  confirmed
that with respect to the exemption  claimed under Section 4(2) of the Securities
Act (i) each  investor  made  representations  that he or she was  sophisticated
and/or an  "accredited  investor"  within  the  meaning of  Regulation  D of the
Securities  Act in relation to such  investments  and (ii) each  purchaser  gave
written assurance of his or her investment  intent, and the certificates for the
securities bear a legend accordingly.

                                             NUMBER OF
                                             SHARES OF    CONSIDERATION
               PURCHASER           DATE    COMMON STOCK     PER SHARE
          -----------------------  -------- -------------- ---------------
          Robert P. Bernardi ....  2/2/94     650,000      $0.0001
          Robert M. Sterling, Jr.  2/2/94     650,000       0.0001
          Herbert Welch..........  2/2/94     150,000       0.0001
          Michael Rakusin........  2/2/94      60,000       0.0001
                                             --------
               Total.............           1,510,000
                                            =========

   The sales of the  securities  described in the  following  table were made in
reliance  upon  Regulation D, Rule 506 of the  Securities  Act,  which  provides
exemptions for transactions not involving a public offering.  With regard to the
Company's  reliance upon the exemption from registration  provided by Regulation
D, Rule 506 of the  Securities  Act of the sale of securities  described  below,
certain  inquiries  were  made by the  Company  to  establish  that  such  sales
qualified for such  exemption.  In particular,  the Company  confirmed that with
respect to the exemption  claimed under Regulation D, Rule 506 of the Securities
Act (i) each  investor  made  representations  that he or she was  sophisticated
and/or an  "accredited  investor"  within  the  meaning of  Regulation  D of the
Securities  Act in relation to such  investments  and (ii) each  purchaser  gave
written assurance of his or her investment  intent, and the certificates for the
securities bear a legend accordingly.

                                                  NUMBER OF
                                                    SHARES OF     CONSIDERATION
            PURCHASER                   DATE      COMMON STOCK     PER SHARE
- --------------------------------        --------- -------------- ---------------
     H. J. Partnership ..............   3/16/94   200,000        $2.20
     H. T. Ardinger, Jr..............   3/16/94   250,000         2.20
     Michael Robbins.................   3/16/94    10,000         2.20
     Fred Kassner....................   3/16/94    20,000         2.20
     Joseph & Pilar Serrano..........   3/16/94    50,000         2.20
     A. Starke Taylor, Jr............   3/16/94    30,000         2.20
     B. Michael Pisani...............   3/16/94    10,000         2.20
     Socrates Skiadas................   3/16/94    50,000         2.20
     Robert E. Murello...............   3/16/94    50,000         2.20
     Moody Insurance Group, Inc. ....   3/16/94   250,000         2.20
     M. Douglas Adkins...............   3/16/94    36,364         2.20
     John R. Whitman.................   3/16/94    20,000         2.20
     Christian & Erika Brunnschweiler   3/16/94    20,000         2.20
                                                  -------
          Total......................             996,364
                                                  =======

                                      II-2


<PAGE>
 

   The sales of the  securities  described in the  following  table were made in
reliance upon Section 4(2) of the Securities Act, which provides  exemptions for
transactions not involving a public offering.  The sales were made in connection
with the acquisition of Viewpoint by the Company.  All of the outstanding Common
Stock and Options of Viewpoint  were  exchanged  for Common Stock and Options of
the Company at an exchange  ratio of .511 shares of the Company to one (1) share
of Viewpoint.

                                                                  NUMBER OF
                                                                  SHARES OF
                   PURCHASER                           DATE      COMMON STOCK
- -----------------------------------------------        --------- --------------
     Glenn A. Norem ................................  5/11/94     113,787
     Glenn A. Norem assignee for Catalyst Financial
     Corporation....................................  5/11/94     511,000
     Michael Nissenbaum.............................  5/11/94      91,980
     Robert Arnold..................................  5/11/94         432
     Greg Garcia....................................  5/11/94      19,164
     June Pappas....................................  5/11/94      25,550
     Chris Hann.....................................  5/11/94      12,775
     G.A. Norem I L.P...............................  5/11/94       4,536
     Gary Motley....................................  5/11/94      12,776
     Newell V. Starks...............................  5/11/94       7,665
     Sherri N. Davis................................  5/11/94      12,775
     Richard Penn...................................  5/11/94     153,300*
     Glenn A. Norem.................................  5/11/94      51,100*
     David Kaufman..................................  5/11/94       4,259*
     Alfred Riccomi.................................  5/11/94      28,560*
     Curtis Barlowe.................................  5/11/94      20,108*
     William Jobe...................................  5/11/94       5,110*
     Minnie Branch..................................  5/11/94         256*
     Michael T. Zimmerman...........................  5/11/94       3,066*
     Charles B. Humphreyson.........................  5/11/94       8,624*
     Leonard A. Woods...............................  5/11/94       6,388*
     Eric Eldridge..................................  5/11/94       3,066*
     Chris Hann.....................................  5/31/94       3,727*
                                                                  ---------
          Total.....................................            1,100,004
                                                                ===========
- ----------
*    Indicates  options  to  purchase  the number of shares  indicated.  Messrs.
     Branch,  Zimmerman,  Humphreyson,  Woods, Eldridge and Hann exercised their
     options on 5/31/94. Mr. Penn exercised his options on 10/31/94.

                                      II-3

<PAGE>
 
   The Company  sold 10,000  shares of Common Stock on June 29, 1994 in exchange
for consulting services,  valued at $22,000, rendered by M.F. Branch Associates,
Inc.  The sale was made in reliance  upon Section  4(2) of the  Securities  Act,
which provides exemptions for transactions not involving a public offering.

   The sales of the  securities  described in the  following  table were made in
reliance  upon  Regulation D, Rule 506 of the  Securities  Act,  which  provides
exemptions for transactions not involving a public offering.  With regard to the
Company's  reliance upon the exemption from registration  provided by Regulation
D, Rule 506 of the  Securities  Act of the sale of securities  described  below,
certain  inquiries  were  made by the  Company  to  establish  that  such  sales
qualified for such  exemption.  In particular,  the Company  confirmed that with
respect to the exemption  claimed under Regulation D, Rule 506 of the Securities
Act (i) each  investor  made  representations  that he or she was  sophisticated
and/or an  "accredited  investor"  within  the  meaning of  Regulation  D of the
Securities  Act in relation to such  investments  and (ii) each  purchaser  gave
written assurance of his or her investment  intent, and the certificates for the
securities bear a legend accordingly.

                                                     BRIDGE
           PURCHASER                DATE        NOTES PURCHASED
- -------------------------------  ----------     -------------------
     H.T. Ardinger..................   9/26/94   $  500,000
     Robert Moody, Jr...............   9/27/94      300,000
     M. Douglas Adkins..............   9/28/94      205,000
     Fred Kassner...................   9/30/94      200,000
     Henry Wendt....................  10/17/94       10,000
     John R. Whitman................  10/17/94       60,000
     Robert Gillings................  10/21/94      315,300
     Elizabeth Sterling.............  10/24/94       50,000
     Glenn A. Norem.................  10/24/94       50,000
     Richard Pizitz.................  10/24/94       20,000
     Michael Pizitz.................  10/24/94       30,000
     Greg Garcia....................  10/26/94       27,000
     A. Starke Taylor, Jr...........  10/31/94       50,000
     Robert Moody, Jr...............  12/20/94      250,000
     Joseph Geary...................   1/10/95       50,000
     H.T. Ardinger..................   1/10/95      250,000
     Adkins Family Partnership, Ltd.   1/16/95      100,000
     Greg Garcia....................   1/17/95       27,562.50
     June Pappas....................   1/17/95       55,125
     Gary Motley....................   1/18/95       27,562.50
     William Heim...................   1/19/95      100,000
                                                -------------------
          Total........................             $2,677,550
                                                ===================

   Holders of $2,330,300  principal amount of convertible debt and approximately
$305,000 of accrued  interest  have elected to convert  these amounts to 470,649
shares of Common Stock and 470,649 Public Warrants (based on an assumed offering
price of $5.50 per share and $0.10 per Public  Warrant).  The  remaining  dollar
amount of bridge notes  purchased plus accrued  interest will be repaid with the
proceeds of this offering.

                                      II-4


<PAGE>

   The sales of the  securities  described in the  following  table were made in
reliance  upon  Regulation D, Rule 506 of the  Securities  Act,  which  provides
exemptions for transactions not involving a public offering.  With regard to the
Company's  reliance upon the exemption from registration  provided by Regulation
D, Rule 506 of the  Securities  Act of the sale of securities  described  below,
certain  inquiries  were  made by the  Company  to  establish  that  such  sales
qualified for such  exemption.  In particular,  the Company  confirmed that with
respect to the exemption  claimed under Regulation D, Rule 506 of the Securities
Act (i) each  investor  made  representations  that he or she was  sophisticated
and/or an  "accredited  investor"  within  the  meaning of  Regulation  D of the
Securities  Act in relation to such  investments  and (ii) each  purchaser  gave
written assurance of his or her investment  intent, and the certificates for the
securities bear a legend accordingly.

                                            NUMBER OF
                                            SHARES OF   CONSIDERATION
       PURCHASER              DATE        COMMON STOCK     PER SHARE
- -----------------------       ----------  -------------- ---------------
     Fred Kassner...........    8/4/95     833,333      $3.00
     H. T. Ardinger.........  12/31/95      16,504       3.00
     M. L. Ardinger.........  12/31/95      16,504       3.00
     Doug Adkins............  12/31/95     107,444       3.00
     Robert Moody...........  12/31/95     147,251       3.00
     Anthony Bellissimo ....  12/31/95       3,694       3.00
     H. T. Ardinger.........  12/31/95      26,747       3.00
     M. L. Ardinger.........  12/31/95      26,747       3.00
     Doug Adkins............   4/18/96      35,813       3.00
     Fred Kassner...........   3/31/96     221,195       3.00
     William Wells..........   4/18/96      16,750       3.00
     David Motley...........   4/18/96       3,333       3.00
     Shain McCaig...........   4/18/96      10,000       3.00
     Rhett Bently...........   4/18/96      30,000       3.00
     James Johnson..........   4/18/96      10,000       3.00
     Craig Noonan...........   4/18/96       3,333       3.00
     Jerry S. Harris........    5/7/96      10,000       3.00
     Lanie R. Hughes........   4/30/96      10,000       3.00
     Joseph W. Geary........   5/24/96      42,333       3.00
     John S. Stoppelman ....    6/1/96      42,666       3.00
     Robert M. Sterling, Jr.   6/28/96      26,666       3.00
     Richard Epstein........   6/28/96      20,000       3.00
     Stanley Epstein........   6/19/96       5,000       3.00
     Joan Etayo.............   6/21/96      16,600       3.00
     Paul Ehrlich...........   6/28/96       8,334       3.00
     Jared Shaw.............   6/28/96       4,167       3.00
     Daniel Kodsi...........   6/28/96       4,167       3.00
     A. Starke Taylor.......   6/28/96      53,333       3.00
     Richard Friedman.......   6/28/96      20,000       3.00
     Robert Rubin...........   6/28/96      36,666       3.00
                                        --------------
          Total...............           1,808,580
                                        ==============

                                      II-5

<PAGE>
 
ITEM 27. LIST OF EXHIBITS

<TABLE>
<CAPTION>
   EXHIBIT
  PAGE NO.                                      DESCRIPTION OF EXHIBIT
- ------------  -----------------------------------------------------------------------------------------
<S>           <C>
1             Form of Underwriting Agreement
2             Agreement and Plan of Merger and Reorganization**
3.01          Certificate of Incorporation**
3.02          Amendment to Certificate of Incorporation**
3.03          Restated By-Laws**
4.01          Form of Common Stock Certificate*
4.02          Form of Warrant Certificate*
4.03          Form of Warrant Agreement between the Company and Continental Stock Transfer & Trust
              Company
4.04          Representatives' Warrant Agreement
5             Opinion of The Stoppelman Law Firm, P.C. on Legality of Securities Being Registered***
9.01          Voting Trust Agreement between Robert M. Sterling, Jr. and Thomas E. Brown**
9.02          Voting Trust Agreement between Robert P. Bernardi and Richard Bernardi**
9.03          Form of Lock-Up Agreement***
9.04          Lock-Up Agreement with Robert Sterling Trust***
9.05          Lock-Up Agreement with Robert Bernardi Trust***
9.06          Lock-Up Agreement with Michael Nissenbaum***
10.01         Modified Employment Agreement between the Company and Glenn A. Norem***
10.02         Modified Consulting Agreement between the Company and Sterling Capital Group Inc.**
10.03         Form of Indemnification Agreement between the Company and Executive Officers and
              Directors**
10.04         1995 Stock Option Plan**
10.05         1994 Stock Option Plan**
10.06         1993 Viewpoint Stock Plan**
10.07         1995 Director Option Plan**
10.08         Lease Agreement between the Company and Metro Squared, L.P.**
10.09         Employee Stock Purchase Plan**
10.10         Licensing Agreement between the Company and Boca Research, Inc.***
10.11         Agreement between the Company and Unisys Corporation***
10.12         Employment Agreement between the Company and Philip M. Colquhoun***
10.13         Employment Agreement between the Company and William S. Leftwich***
10.14         Employment Agreement between the Company and David T. Stoner***
10.15         Employment Agreement between the Company and Neal Page***
10.16         Employment Agreement between the Company and A. David Boomstein***
10.17         Employment Agreement between the Company and Daniel W. Dodson***
10.18         Lease between the Company and Burlingame Home Office, Inc.***
10.19         Lease between the Company and Family Funds Partnership***
10.20         Agreement between the Company and Catalyst Financial Corporation***
10.21         Promissory Note by the Company payable to Robert Rubin dated September 5, 1996.
10.22         Promissory Note by the Company payable to M. Douglas Adkins dated November 15, 1996
10.23         Promissory Note by the Company payable to H.T. Ardinger dated November 15, 1996
11            Calculation of Net Loss Per Share
16            Letter from Hoffman, Morrison, & Fitzgerald, P.C.
21            List of Subsidiaries of the Company**
23.01         Consent of The Stoppelman Law Firm, P.C.
23.02         Consent of Ernst & Young LLP
23.03         Consent of Hoffman, Morrison, & Fitzgerald, P.C.
24            Power of Attorney*****
</TABLE>
- ----------

   *     To be filed by amendment.

   **    Filed with initial filing dated August 9, 1996.

   
   ***   Filed with Amendment 1 dated October 4, 1996.

   ****  The Company has requested confidential treatment of certain portions of
         this document and such portions have been redacted from this agreement.

   ***** Included with signature pages.
    

                                      II-6

<PAGE>
 
ITEM 28. UNDERTAKINGS

A. Certificates

   The undersigned registrant hereby undertakes to provide to the Representative
at the closing  specified in the  underwriting  agreement,  certificates in such
denominations  and  registered in such names as required by the  underwriter  to
permit prompt delivery to each purchaser.

B. Rule 415 Offering

   The undersigned 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  to: (i) Include any
prospectus  required by Section  10(a)(3) of the Securities Act; (ii) Reflect in
the prospectus any facts or events which, individually or together,  represent a
fundamental  change in the information in the registration  statement and; (iii)
Include  any  additional  or  changed  material   information  on  the  plan  of
distribution.

   (2)  For   determining   liability  under  the  Securities  Act,  treat  each
post-effective  amendment  as a new  registration  statement  of the  securities
offered,  and the offering of the securities at that time to be the initial bona
fide offering.

   (3) File a  post-effective  amendment to remove from  registration any of the
securities that remain unsold at the end of the offering.

C. Request for Acceleration of Effective Date

   The Company may elect to request  acceleration  of the effective  date of the
Registration Statement under Rule 461 of the Securities Act.

   Insofar as indemnification  for liabilities  arising under the Securities Act
of 1933 (the  "Securities  Act") may be  permitted  to  directors,  officers and
controlling  persons of the small  business  issuer  pursuant  to the  foregoing
provisions, or otherwise, the small business issuer 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.

   In the event that a claim for indemnification against such liabilities (other
than the payment by the  registrant of expenses  incurred or paid by a director,
officer or controlling person of the registrant in the successful defense of any
action, suit or proceeding) is asserted by such director, officer or controlling
person in connection with the securities being registered,  the registrant will,
unless in the opinion of its counsel the matter has been settled by  controlling
precedent,  submit to a court of appropriate  jurisdiction  the question whether
such  indemnification  by it is  against  public  policy  as  expressed  in  the
Securities Act and will be governed by the final adjudication of such issue.

                                      II-7
<PAGE>
 
                                  SIGNATURES

   
   In  accordance  with the  requirements  of the  Securities  Act of 1933,  the
registrant certifies that it has reasonable grounds to believe that it meets all
of the  requirements  of filing on Form SB-2 and  authorized  this  registration
statement to be signed on its behalf by the undersigned, in the County of Dallas
in the State of Texas on 13th day of November, 1996.     

                                        Multimedia Access Corporation


                                        By:     /s/ Glenn A. Norem
                                            ------------------------------------
                                                Glenn A. Norem
                                                Chief Executive Officer

   KNOW ALL MEN BY THESE PRESENT, that each person whose signature appears below
constitutes  and appoints Glenn A. Norem,  his true and lawful  attorney-in-fact
and agent,  with full power of substitution and  resubstitution,  for him and in
his  name,  place  and  stead,  in any and all  capacities,  to sign any and all
amendments (including post-effective amendments) to this registration statement,
and to file  the  same,  with  all  exhibits  thereto  and  other  documents  in
connection therewith, with the Securities and Exchange Commission, granting unto
said attorney-in-fact and agent, full power and authority to do and perform each
and every  act and  thing  requisite  or  necessary  to be done in and about the
premises, as full to all intents and purposes as he might or could do in person,
hereby  ratifying and  confirming  all that said  attorney-in-fact  and agent or
either of them or their or his  substitute  or  substitutes,  may lawfully do or
cause to be done by virtue hereof.

   In accordance  with the  requirements  of the  Securities  Act of 1933,  this
Registration Statement was signed by the following persons in the capacities and
on the dates stated.

         SIGNATURE                       TITLE                     DATE
         ---------                       -----                     ----

     /s/ Glenn A. Norem           Chief Executive Officer      November 13, 1996
- -----------------------------         and Director
     Glenn A. Norem   

                     
     /s/ William S. Leftwich      Chief Financial Officer      November 13, 1996
- -----------------------------
     William S. Leftwich 
  

     /s/ William D. Jobe          Director                     November 13, 1996
- -----------------------------
     William D. Jobe  
 

     /s/ Joe C. Culp              Director                     November 13, 1996
- ------------------------------                                          
     Joe C. Culp  

                                      II-8

<PAGE>


                                EXHIBIT INDEX

<TABLE>
<CAPTION>
                                                                                                          SEQUENTIAL
   EXHIBIT                                                                                                    PAGE
  PAGE NO.                                      DESCRIPTION OF EXHIBIT                                       NUMBER
- ------------  -----------------------------------------------------------------------------------------
<S>           <C>
1             Form of Underwriting Agreement
2             Agreement and Plan of Merger and Reorganization**
3.01          Certificate of Incorporation**
3.02          Amendment to Certificate of Incorporation**
3.03          Restated By-Laws**
4.01          Form of Common Stock Certificate*
4.02          Form of Warrant Certificate*
4.03          Form of Warrant Agreement between the Company and Continental Stock Transfer & Trust
              Company
4.04          Representatives' Warrant Agreement
5             Opinion of The Stoppelman Law Firm, P.C. on Legality of Securities Being Registered***
9.01          Voting Trust Agreement between Robert M. Sterling, Jr. and Thomas E. Brown**
9.02          Voting Trust Agreement between Robert P. Bernardi and Richard Bernardi**
9.03          Form of Lock-Up Agreement***
9.04          Lock-Up Agreement with Robert Sterling Trust***
9.05          Lock-Up Agreement with Robert Bernardi Trust***
9.06          Lock-Up Agreement with Michael Nissenbaum***
10.01         Modified Employment Agreement between the Company and Glenn A. Norem***
10.02         Modified Consulting Agreement between the Company and Sterling Capital Group Inc.**
10.03         Form of Indemnification Agreement between the Company and Executive Officers and
              Directors**
10.04         1995 Stock Option Plan**
10.05         1994 Stock Option Plan**
10.06         1993 Viewpoint Stock Plan**
10.07         1995 Director Option Plan**
10.08         Lease Agreement between the Company and Metro Squared, L.P.**
10.09         Employee Stock Purchase Plan**
10.10         Licensing Agreement between the Company and Boca Research, Inc.***
10.11         Agreement between the Company and Unisys Corporation***
10.12         Employment Agreement between the Company and Philip M. Colquhoun***
10.13         Employment Agreement between the Company and William S. Leftwich***
10.14         Employment Agreement between the Company and David T. Stoner***
10.15         Employment Agreement between the Company and Neal Page***
10.16         Employment Agreement between the Company and A. David Boomstein***
10.17         Employment Agreement between the Company and Daniel W. Dodson***
10.18         Lease between the Company and Burlingame Home Office, Inc.***
10.19         Lease between the Company and Family Funds Partnership***
10.20         Agreement between the Company and Catalyst Financial Corporation***
10.21         Promissory Note by the Company payable to Robert Rubin dated September 5, 1996.
10.22         Promissory Note by the Company payable to M. Douglas Adkins dated November 15, 1996
10.23         Promissory Note by the Company payable to H.T. Ardinger dated November 15, 1996
11            Calculation of Net Loss Per Share
16            Letter from Hoffman, Morrison, & Fitzgerald, P.C.
21            List of Subsidiaries of the Company**
23.01         Consent of The Stoppelman Law Firm, P.C.
23.02         Consent of Ernst & Young LLP
23.03         Consent of Hoffman, Morrison, & Fitzgerald, P.C.
24            Power of Attorney*****
</TABLE>
- ----------
   
   *     To be filed by amendment.

   **    Filed with initial filing dated August 9, 1996.

   ***   Filed with Amendment 1 dated October 4, 1996.

   ****  The Company has requested confidential treatment of certain portions of
         this document and such portions have been redacted from this agreement.

   ***** Included with signature pages.
    


                                                                        10/25/96







         [Form of Underwriting Agreement - Subject to Additional Review]


                        1,800,000 Shares of Common Stock
                        and 1,800,000 Redeemable Warrants

                          MULTIMEDIA ACCESS CORPORATION

                             UNDERWRITING AGREEMENT
                             ----------------------


                                                              New York, New York
                                                                          , 1996


NATIONAL SECURITIES CORPORATION
  As Representative of the
  Several Underwriters listed on Schedule A hereto
1001 Fourth Avenue
Suite 2200
Seattle, Washington  98154

Ladies and Gentlemen:

        Multimedia Access Corporation,  a Delaware  corporation (the "Company"),
confirms its agreement with National  Securities  Corporation  ("National")  and
each  of  the  underwriters  named  in  Schedule  A  hereto  (collectively,  the
"Underwriters,"  which term shall also include any  underwriter  substituted  as
hereinafter   provided  in  Section  11),   for  whom   National  is  acting  as
representative  (in such capacity,  National shall hereinafter be referred to as
"you" or the "Representative"),  with respect to the sale by the Company and the
purchase  by  the  Underwriters,  acting  severally  and  not  jointly,  of  the
respective  numbers of shares  ("Shares") of the Company's common stock,  $.0001
par value per share  ("Common  Stock"),  and  redeemable  common stock  purchase
warrants  (the  "Redeemable  Warrants"),  each to  purchase  one share of Common
Stock,  set forth in  Schedule  A hereto.  The  aggregate  1,800,000  Shares and
1,800,000 Redeemable Warrants will be separately tradeable upon issuance and are
hereinafter  referred to as the "Firm  Securities."  Each Redeemable  Warrant is
exercisable






<PAGE>



commencing  on  ____________,  1997 [6 months  from the date of this  Agreement]
until  ____________,  2001 [60 months from the date of this  Agreement],  unless
previously  redeemed by the Company,  at an initial  exercise  price of $_______
[120% of the  initial  public  offering  price] per share of Common  Stock.  The
Redeemable Warrants may be redeemed by the Company at a redemption price of $.10
per Redeemable Warrant at any time after _____________, 1998 [18 months from the
date of this Agreement] on thirty (30) days' prior written notice, provided that
the  average   closing  bid  price  of  the  Common   Stock  equals  or  exceeds
$_____________  [250% of the  exercise  price]  per share,  for any twenty  (20)
trading days within a period of thirty (30)  consecutive  trading days ending on
the fifth trading day prior to the notice of redemption,  all in accordance with
the terms and conditions of the Warrant Agreement (herein defined).

        Upon your request,  as provided in Section 2(b) of this  Agreement,  the
Company shall also issue and sell to the Underwriters,  acting severally and not
jointly,  up to an  additional  270,000  shares of Common Stock  and/or  270,000
Redeemable  Warrants for the purpose of covering  over-allotments,  if any. Such
270,000 shares of Common Stock and 270,000  Redeemable  Warrants are hereinafter
collectively to as the "Option  Securities."  The Company also proposes to issue
and sell to you  warrants  (the  "Representative's  Warrants")  pursuant  to the
Representative's  Warrant Agreement (the  "Representative's  Warrant Agreement")
for the purchase of an additional  180,000 shares of Common Stock and/or 180,000
Redeemable Warrants. The shares of Common Stock and Redeemable Warrants issuable
upon exercise of the  Representative's  Warrants are hereinafter  referred to as
the "Representative's  Securities." The Firm Securities,  the Option Securities,
the Representative's Warrants and the Representative's Securities (collectively,
hereinafter  referred to as the  "Securities")  are more fully  described in the
Registration Statement and the Prospectus referred to below.

        1. Representations and Warranties of the Company. The Company represents
and  warrants  to,  and agrees  with,  each of the  Underwriters  as of the date
hereof,  and as of the Closing  Date (as  hereinafter  defined)  and each Option
Closing Date (as hereinafter defined), if any, as follows:

              a. The  Company has  prepared  and filed with the  Securities  and
Exchange  Commission  (the  "Commission")  a  registration  statement,   and  an
amendment or amendments  thereto,  on Form SB-2 (No.  333-09935),  including any
related preliminary prospectus ("Preliminary Prospectus"),  for the registration
of  the  Firm  Securities,   the  Option  Securities  and  the  Representative's
Securities  under the  Securities  Act of 1933,  as amended (the  "Act"),  which
registration  statement and  amendment or  amendments  have been prepared by the
Company  in  conformity  with the  requirements  of the Act,  and the  rules and
regulations  (the  "Regulations")  of the Commission  under the Act. The Company
will promptly  file a further  amendment to said  registration  statement in the
form  heretofore  delivered  to the  Underwriters  and will  not file any  other
amendment thereto to which the Underwriters shall have objected in writing after
having been furnished  with a copy thereof.  Except as the context may otherwise
require, such registration statement, as amended, on file with the Commission at
the time the registration statement becomes effective (including the prospectus,
financial  statements,  schedules,  exhibits and all other  documents filed as a
part  thereof  or  incorporated  therein  (including,  but not  limited to those
documents or information  incorporated by reference therein) and all information
deemed


                                        2

<PAGE>



to be a part thereof as of such time pursuant to paragraph (b) of Rule 430(A) of
the Regulations),  is hereinafter called the "Registration  Statement",  and the
form of prospectus in the form first filed with the Commission  pursuant to Rule
424(b) of the Regulations,  is hereinafter called the "Prospectus." For purposes
hereof,  "Rules and Regulations"  mean the rules and regulations  adopted by the
Commission  under  either the Act or the  Securities  Exchange  Act of 1934,  as
amended (the "Exchange Act"), as applicable.

              b. Neither the Commission nor any state  regulatory  authority has
issued any order preventing or suspending the use of any Preliminary Prospectus,
the  Registration  Statement  or  Prospectus  or any part of any  thereof and no
proceedings for a stop order  suspending the  effectiveness  of the Registration
Statement or any of the Company's securities have been instituted or are pending
or threatened.  Each of the Preliminary  Prospectus,  the Registration Statement
and Prospectus at the time of filing thereof  conformed with the requirements of
the Act and the Rules and Regulations,  and none of the Preliminary  Prospectus,
the Registration Statement or Prospectus at the time of filing thereof contained
an untrue  statement  of a material  fact or  omitted  to state a material  fact
required to be stated  therein or necessary to make the statements  therein,  in
light of the  circumstances  under which they were made, not misleading,  except
that this  representation  and  warranty  does not apply to  statements  made in
reliance  upon and in  conformity  with  written  information  furnished  to the
Company with  respect to the  Underwriters  by or on behalf of the  Underwriters
expressly  for use in such  Preliminary  Prospectus,  Registration  Statement or
Prospectus or any amendment thereof or supplement thereto.

              c. When the Registration  Statement  becomes  effective and at all
times  subsequent  thereto up to the Closing  Date (as defined  herein) and each
Option Closing Date (as defined  herein),  if any, and during such longer period
as the  Prospectus  may be required to be delivered in connection  with sales by
the Underwriters or a dealer, the Registration Statement and the Prospectus will
contain all  statements  which are required to be stated  therein in  accordance
with the Act and the Rules and Regulations, and will conform to the requirements
of the Act and the Rules and Regulations; neither the Registration Statement nor
the Prospectus, nor any amendment or supplement thereto, will contain any untrue
statement of a material  fact or omit to state any material  fact required to be
stated  therein or necessary  to make the  statements  therein,  in light of the
circumstances  under which they were made, not  misleading,  provided,  however,
that this  representation  and  warranty  does not apply to  statements  made or
statements  omitted in reliance upon and in strict  conformity with  information
furnished to the Company in writing by or on behalf of any Underwriter expressly
for use in the Preliminary  Prospectus,  Registration Statement or Prospectus or
any amendment thereof or supplement thereto.

              d.   Each  of  the   Company   and  the   Company's   wholly-owned
subsidiaries,  Viewpoint  Systems  Inc.,  Viewpoint  Videoware  Inc.  and Osprey
Technologies  Inc., all Delaware  companies  (such  subsidiaries  being the only
subsidiaries  that are "significant  subsidiaries"  (as defined in the Rules and
Regulations) of the Company, is hereinafter  referred to as the "Subsidiaries"),
has been  duly  organized  and is  validly  existing  as a  corporation  in good
standing under the laws of the state of its  incorporation.  Except as set forth
in the Prospectus,  neither the Company nor the  Subsidiaries own an interest in
any  corporation,  partnership,  trust,  joint venture or other business entity.
Each of the Company and the Subsidiaries is duly qualified and licensed and


                                        3

<PAGE>

in good  standing as a foreign  corporation  in each  jurisdiction  in which its
ownership  or leasing  of any  properties  or the  character  of its  operations
requires  such  qualification  or  licensing.  The  Company  owns,  directly  or
indirectly,  one hundred percent (100%) of the outstanding  capital stock of the
Subsidiaries,  and all of such shares have been validly  issued,  are fully paid
and non-assessable,  were not issued in violation of any preemptive rights, and,
except as set forth in the  Prospectus,  are owned  free and clear of any liens,
charges, claims,  encumbrances,  pledges,  security interests,  defects or other
restrictions  or  equities of any kind  whatsoever.  Each of the Company and the
Subsidiaries  has all requisite power and authority  (corporate and other),  and
has obtained any and all necessary authorizations,  approvals, orders, licenses,
certificates,  franchises and permits of and from all governmental or regulatory
officials and bodies (including,  without limitation,  those having jurisdiction
over environmental or similar matters), domestic or foreign, to own or lease its
properties and conduct its business as described in the Prospectus;  each of the
Company and the  Subsidiaries  is and has been doing business in compliance with
all such authorizations,  approvals, orders, licenses, certificates,  franchises
and permits and all applicable federal, state, local and foreign laws, rules and
regulations;  and neither the Company nor the  Subsidiaries  have  received  any
notice of  proceedings  relating to the revocation or  modification  of any such
authorization,  approval,  order,  license,  certificate,  franchise,  or permit
which,  singly or in the aggregate,  if the subject of an unfavorable  decision,
ruling  or  finding,  would  materially  and  adversely  affect  the  condition,
financial or otherwise, or the earnings, position,  prospects, value, operation,
properties,   business  or  results  of   operations   of  the  Company  or  the
Subsidiaries.  The  disclosures  in the  Registration  Statement  concerning the
effects of federal, state, local, and foreign laws, rules and regulations on the
Company's  and  the  Subsidiaries'  businesses  as  currently  conducted  and as
contemplated  are correct in all  material  respects  and do not omit to state a
material fact required to be stated  therein or necessary to make the statements
contained therein not misleading in light of the circumstances  under which they
were made.

              e. The  Company  has a duly  authorized,  issued  and  outstanding
capitalization  as  set  forth  in the  Prospectus  under  "Capitalization"  and
"Description of Securities" and will have the adjusted  capitalization set forth
therein on the Closing Date and each Option Closing Date, if any, based upon the
assumptions set forth therein, and the Company is not a party to or bound by any
instrument, agreement or other arrangement providing for it to issue any capital
stock, rights, warrants, options or other securities, except for this Agreement,
the Warrant Agreement,  the Representative's  Warrant Agreement and as described
in the Prospectus. The Securities and all other securities issued or issuable by
the Company conform or, when issued and paid for, will conform,  in all respects
to all statements with respect thereto  contained in the Registration  Statement
and the Prospectus.  All issued and  outstanding  securities of the Company have
been duly  authorized and validly  issued and are fully paid and  non-assessable
and the holders thereof have no rights of rescission with respect  thereto,  and
are not subject to personal liability by reason of being such holders;  and none
of such  securities  were issued in  violation of the  preemptive  rights of any
holders of any security of the Company or similar  contractual rights granted by
the Company. The Securities are not and will not be subject to any preemptive or
other similar rights of any  stockholder,  have been duly  authorized  and, when
issued,  paid for and  delivered in accordance  with the terms  hereof,  will be
validly  issued,   fully  paid  and  non-assessable  and  will  conform  to  the
description thereof contained in the Prospectus; the holders thereof will not be
subject to any liability solely as such holders; all corporate action required


                                        4

<PAGE>

to be taken for the  authorization,  issue and sale of the  Securities  has been
duly and validly taken; and the certificates representing the Securities will be
in due and proper form.  Upon the  issuance  and delivery  pursuant to the terms
hereof of the Securities to be sold by the Company  hereunder,  the Underwriters
or the  Representative,  as the case may be, will  acquire  good and  marketable
title to such Securities free and clear of any lien, charge, claim, encumbrance,
pledge,  security  interest,  defect or other  restriction or equity of any kind
whatsoever.

              f. The  consolidated  financial  statements of the Company and the
Subsidiaries, together with the related notes and schedules thereto, included in
the  Registration  Statement,  each  Preliminary  Prospectus  and the Prospectus
fairly present the financial position,  income, changes in cash flow, changes in
stockholders'  equity  and the  results of  operations  of the  Company  and the
Subsidiaries  at the respective  dates and for the  respective  periods to which
they apply and such financial  statements  have been prepared in conformity with
generally  accepted  accounting   principles  and  the  Rules  and  Regulations,
consistently   applied  throughout  the  periods  involved  and  such  financial
statements  as are  audited  have been  examined  by Ernst & Young LLP,  who are
independent  certified public  accountants within the meaning of the Act and the
Rules and Regulations,  as indicated in their report filed therewith.  There has
been no adverse change or development  involving a prospective adverse change in
the condition,  financial or otherwise, or in the earnings, position, prospects,
value, operation,  properties, business, or results of operations of the Company
and the  Subsidiaries  taken as a whole,  whether or not arising in the ordinary
course of business,  since the date of the financial  statements included in the
Registration  Statement  and  the  Prospectus  and  the  outstanding  debt,  the
property, both tangible and intangible,  and the business of the Company and the
Subsidiaries,  conform in all  material  respects  to the  descriptions  thereof
contained  in  the   Registration   Statement  and  the  Prospectus.   Financial
information (including, without limitation, any pro forma financial information)
set forth in the Prospectus under the headings "Summary  Consolidated  Financial
Information",  "Selected  Consolidated  Financial Data,"  "Capitalization,"  and
"Management's  Discussion  and  Analysis of Financial  Condition  and Results of
Operations,"  fairly  present,  on  the  basis  stated  in the  Prospectus,  the
information set forth therein, and have been derived from or compiled on a basis
consistent  with  that  of the  audited  financial  statements  included  in the
Prospectus;  and, in the case of pro forma  financial  information,  if any, the
assumptions  used in the preparation  thereof are reasonable and the adjustments
used  therein  are   appropriate  to  give  effect  to  the   transactions   and
circumstances  referred to therein. The amounts shown as accrued for current and
deferred income and other taxes in such financial  statements are sufficient for
the payment of all accrued and unpaid federal,  state,  local and foreign income
taxes,  interest,  penalties,  assessments  or  deficiencies  applicable  to the
Company and the Subsidiaries, whether disputed or not, for the applicable period
then ended and periods prior thereto;  adequate  allowance for doubtful accounts
has been provided for unindemnified  losses due to the operations of the Company
and the  Subsidiaries;  and the statements of income do not contain any items of
special or  nonrecurring  income not earned in the ordinary  course of business,
except as specified in the notes thereto.

              g.  Each of the  Company  and the  Subsidiaries  (i) has  paid all
federal, state, local, and foreign taxes for which it is liable,  including, but
not limited to,  withholding taxes and amounts payable under Chapters 21 through
24 of the  Internal  Revenue  Code of 1986,  as amended  (the  "Code"),  and has
furnished  all  information  returns it is required  to furnish  pursuant to the
Code,


                                        5

<PAGE>

(ii) has  established  adequate  reserves  for such taxes  which are not due and
payable,  and (iii)  does not have any tax  deficiency  or  claims  outstanding,
proposed or assessed against it.

              h. No transfer tax,  stamp duty or other similar tax is payable by
or on behalf of the  Underwriters  in  connection  with (i) the  issuance by the
Company of the  Securities,  (ii) the purchase by the  Underwriters  of the Firm
Securities  and the Option  Securities  from the Company and the purchase by the
Representative  of the  Representative's  Warrants  from the Company,  (iii) the
consummation by the Company of any of its obligations  under this Agreement,  or
(iv) resales of the Firm Securities and the Option Securities in connection with
the distribution contemplated hereby.

              i. Each of the Company and the  Subsidiaries  maintains  insurance
policies, including, but not limited to, general liability, product and property
insurance,  which  insures  each of the  Company,  the  Subsidiaries  and  their
respective employees, against such losses and risks generally insured against by
comparable businesses.  Neither the Company nor the Subsidiaries (A) have failed
to give  notice or  present  any  insurance  claim with  respect to any  matter,
including  but not limited to the  Company's  business,  property or  employees,
under any insurance  policy or surety bond in a due and timely manner,  (B) have
any disputes or claims against any  underwriter  of such  insurance  policies or
surety bonds or has failed to pay any premiums  due and payable  thereunder,  or
(C) have  failed to  comply  with all  conditions  contained  in such  insurance
policies and surety bonds.  There are no facts or  circumstances  under any such
insurance  policy  or  surety  bond  which  would  relieve  any  insurer  of its
obligation   to  satisfy  in  full  any  valid  claim  of  the  Company  or  the
Subsidiaries.

              j. There is no action,  suit,  proceeding,  inquiry,  arbitration,
investigation,   litigation  or  governmental  proceeding  (including,   without
limitation,  those having  jurisdiction over  environmental or similar matters),
domestic or foreign,  pending or threatened  against (or circumstances  that may
give rise to the same),  or involving the properties or business of, the Company
or the Subsidiaries which (i) questions the validity of the capital stock of the
Company, this Agreement,  the Warrant Agreement or the Representative's  Warrant
Agreement,  or of any action taken or to be taken by the Company  pursuant to or
in connection with this Agreement, the Warrant Agreement or the Representative's
Warrant  Agreement,  (ii)  is  required  to be  disclosed  in  the  Registration
Statement  which is not so disclosed (and such  proceedings as are summarized in
the Registration  Statement are accurately summarized in all material respects),
or (iii) might  materially  and  adversely  affect the  condition,  financial or
otherwise, or the earnings,  position,  prospects,  stockholders' equity, value,
operation,  properties, business or results of operations of the Company and the
Subsidiaries taken as a whole.

              k. The  Company  has full  legal  right,  power and  authority  to
authorize,  issue,  deliver and sell the Securities,  enter into this Agreement,
the  Warrant  Agreement  and  the  Representative's  Warrant  Agreement  and  to
consummate  the  transactions  provided  for  in  this  Agreement,  the  Warrant
Agreement and the Representative's  Warrant Agreement;  and this Agreement,  the
Warrant Agreement and the Representative's Warrant Agreement have each been duly
and properly  authorized,  executed and  delivered by the Company.  Each of this
Agreement,  the Warrant  Agreement and the  Representative's  Warrant  Agreement
constitutes  a legal,  valid and binding  agreement  of the Company  enforceable
against the Company in accordance with its


                                        6

<PAGE>

terms, and none of the Company's issue and sale of the Securities,  execution or
delivery  of this  Agreement,  the  Warrant  Agreement  or the  Representative's
Warrant Agreement, its performance hereunder and thereunder, its consummation of
the transactions contemplated herein and therein, or the conduct of its business
as described in the Registration Statement,  the Prospectus,  and any amendments
or supplements thereto,  conflicts with or will conflict with or results or will
result in any  breach or  violation  of any of the  terms or  provisions  of, or
constitutes  or will  constitute a default  under,  or result in the creation or
imposition of any lien, charge, claim,  encumbrance,  pledge, security interest,
defect or other  restriction or equity of any kind whatsoever upon, any property
or assets  (tangible or  intangible)  of either the Company or the  Subsidiaries
pursuant  to the terms of (i) the  certificate  of  incorporation  or by-laws of
either the Company or the Subsidiaries,  (ii) any license, contract,  collective
bargaining agreement,  indenture,  mortgage,  deed of trust, lease, voting trust
agreement,  stockholders agreement,  note, loan or credit agreement or any other
agreement or  instrument to which either the Company or the  Subsidiaries  are a
party or by which either the Company or the  Subsidiaries are or may be bound or
to which any of their  respective  properties or assets (tangible or intangible)
is or may be  subject,  or any  indebtedness,  or (iii) any  statute,  judgment,
decree,  order,  rule or  regulation  applicable  to either  the  Company or the
Subsidiaries of any arbitrator,  court, regulatory body or administrative agency
or other  governmental  agency or body  (including,  without  limitation,  those
having jurisdiction over environmental or similar matters), domestic or foreign,
having  jurisdiction over either the Company or the Subsidiaries or any of their
respective activities or properties.

              l. No consent, approval,  authorization or order of, and no filing
with, any court,  regulatory body,  government agency or other body, domestic or
foreign,  is  required  for  the  issuance  of the  Securities  pursuant  to the
Prospectus and the  Registration  Statement,  the performance of this Agreement,
the  Warrant  Agreement  and  the  Representative's  Warrant  Agreement  and the
transactions contemplated hereby and thereby,  including without limitation, any
waiver of any  preemptive,  first  refusal  or other  rights  that any entity or
person may have for the issue and/or sale of any of the Securities,  except such
as have been or may be  obtained  under the Act or may be  required  under state
securities or Blue Sky laws in connection  with the  Underwriters'  purchase and
distribution  of  the  Firm  Securities  and  the  Option  Securities,  and  the
Representative's Warrants to be sold by the Company hereunder.

              m. All executed agreements, contracts or other documents or copies
of executed  agreements,  contracts or other  documents filed as exhibits to the
Registration  Statement  to which either the Company or the  Subsidiaries  are a
party  or by  which  either  of them  may be  bound  or to  which  any of  their
respective  assets,  properties  or business  may be subject  have been duly and
validly  authorized,  executed and delivered by the Company or the Subsidiaries,
as the case may be, and  constitute the legal,  valid and binding  agreements of
the Company or the Subsidiaries, as the case may be, enforceable against each of
them  in  accordance  with  their  respective  terms.  The  descriptions  in the
Registration Statement of agreements, contracts and other documents are accurate
and fairly present the information  required to be shown with respect thereto by
Form SB-2, and there are no contracts or other  documents  which are required by
the Act to be  described in the  Registration  Statement or filed as exhibits to
the Registration Statement which are not described or filed as required, and the
exhibits  which have been filed are complete and correct copies of the documents
of which they purport to be copies.



                                        7

<PAGE>

              n. Subsequent to the respective  dates as of which  information is
set  forth in the  Registration  Statement  and  Prospectus,  and  except as may
otherwise be indicated or  contemplated  herein or therein,  neither the Company
nor the Subsidiaries have (i) issued any securities or incurred any liability or
obligation,  direct or  contingent,  for borrowed  money,  (ii) entered into any
transaction other than in the ordinary course of business,  or (iii) declared or
paid any dividend or made any other distribution on or in respect of its capital
stock of any class,  and there has not been any change in the capital stock,  or
any change in the debt (long or short term) or liabilities  or material  adverse
change in or affecting the general affairs,  management,  financial  operations,
stockholders'  equity or results  of  operations  of either  the  Company or the
Subsidiaries.

              o. No default exists in the due  performance and observance of any
term,  covenant or  condition of any license,  contract,  collective  bargaining
agreement,  indenture,  mortgage,  installment  sale agreement,  lease,  deed of
trust, voting trust agreement,  stockholders  agreement,  partnership agreement,
note,  loan or credit  agreement,  purchase  order,  or any other  agreement  or
instrument  evidencing an obligation for borrowed  money,  or any other material
agreement or  instrument to which either the Company or the  Subsidiaries  are a
party or by which  either  the  Company or the  Subsidiaries  may be bound or to
which the property or assets  (tangible or  intangible) of either the Company or
the Subsidiaries are subject or affected.

              p. Each of the Company and the Subsidiaries has generally  enjoyed
a  satisfactory  employer-employee  relationship  with its  employees  and is in
compliance  with all federal,  state,  local,  and foreign laws and  regulations
respecting  employment  and  employment  practices,   terms  and  conditions  of
employment and wages and hours.  There are no pending  investigations  involving
either the Company or the  Subsidiaries by the U.S.  Department of Labor, or any
other  governmental  agency  responsible  for the  enforcement  of such federal,
state, local, or foreign laws and regulations. There is no unfair labor practice
charge or  complaint  against  either the  Company or the  Subsidiaries  pending
before the National Labor Relations Board, or any comparable  foreign agency, or
any lockout, strike,  picketing,  boycott, dispute, slowdown or stoppage pending
or threatened  against or involving either the Company or the  Subsidiaries,  or
any predecessor entity, and none has ever occurred.  No representation  question
exists respecting the employees of either the Company or the  Subsidiaries,  and
no collective  bargaining  agreement or modification  thereof is currently being
negotiated  by  either  the  Company  or  the  Subsidiaries.   No  grievance  or
arbitration  proceeding  is pending  under any  expired or  existing  collective
bargaining  agreements  of either  the  Company  or the  Subsidiaries.  No labor
dispute with the employees of either the Company or the Subsidiaries exists, or,
is imminent.

              q. Neither the Company nor the Subsidiaries  maintain,  sponsor or
contribute to any program or arrangement  that is an "employee  pension  benefit
plan," an "employee  welfare  benefit plan," or a  "multiemployer  plan" as such
terms are  defined  in  Sections  3(2),  3(1) and  3(37),  respectively,  of the
Employee  Retirement  Income Security Act of 1974, as amended  ("ERISA") ("ERISA
Plans"). Neither the Company nor the Subsidiaries maintain or contribute, now or
at any time  previously,  to a defined benefit plan, as defined in Section 3(35)
of ERISA.  No ERISA  Plan (or any trust  created  thereunder)  has  engaged in a
"prohibited  transaction"  within the meaning of Section 406 of ERISA or Section
4975 of the Code, which could subject the Company or the Subsidiaries to any tax
penalty on prohibited transactions and which has not


                                        8

<PAGE>

adequately been corrected.  Each ERISA Plan is in compliance with all reporting,
disclosure  and other  requirements  of the Code and ERISA as they relate to any
such ERISA Plan.  Determination  letters  have been  received  from the Internal
Revenue Service with respect to each ERISA Plan which is intended to comply with
Code Section  401(a),  stating that such ERISA Plan and the attendant  trust are
qualified  thereunder.  Neither  the  Company  nor the  Subsidiaries  have  ever
completely or partially withdrawn from a "multiemployer plan."

              r.  Neither  the  Company,  the  Subsidiaries,  nor  any of  their
respective employees, directors,  stockholders,  partners, or affiliates (within
the meaning of the Rules and  Regulations) of any of the foregoing have taken or
will  take,  directly  or  indirectly,  any  action  designed  to or  which  has
constituted or which might be expected to cause or result in, under the Exchange
Act, or otherwise, stabilization or manipulation of the price of any security of
the Company to facilitate the sale or resale of the Securities or otherwise.

              s. Except as otherwise  disclosed in the  Prospectus,  none of the
patents,  patent  applications,  trademarks,  service  marks,  trade  names  and
copyrights,  and licenses and rights to the foregoing presently owned or held by
either the  Company or the  Subsidiaries,  are in dispute so far as known by the
Company  or are in any  conflict  with the right of any other  person or entity.
Each of the Company and the  Subsidiaries (i) owns or has the right to use, free
and  clear  of all  liens,  charges,  claims,  encumbrances,  pledges,  security
interests, defects or other restrictions or equities of any kind whatsoever, all
patents, trademarks,  service marks, trade names and copyrights,  technology and
licenses  and rights with respect to the  foregoing,  used in the conduct of its
business as now conducted or proposed to be conducted without infringing upon or
otherwise  acting  adversely  to the  right  or  claimed  right  of any  person,
corporation  or other entity under or with respect to any of the  foregoing  and
(ii) is not obligated or under any  liability  whatsoever to make any payment by
way of  royalties,  fees or  otherwise  to any  owner or  licensee  of, or other
claimant  to, any  patent,  trademark,  service  mark,  trade  name,  copyright,
know-how,  technology or other intangible asset, with respect to the use thereof
or in connection with the conduct of its business or otherwise.

              t.  Each of the  Company  and the  Subsidiaries  owns  and has the
unrestricted  right to use all  trade  secrets,  know-how  (including  all other
unpatented and/or unpatentable proprietary or confidential information,  systems
or procedures),  inventions,  designs, processes, works of authorship,  computer
programs and technical data and information  (collectively  herein "intellectual
property") that are material to the development, manufacture, operation and sale
of all products  and services  sold or proposed to be sold by either the Company
or the Subsidiaries, free and clear of and without violating any right, lien, or
claim  of  others,  including  without  limitation,   former  employers  of  its
employees;  provided, however, that the possibility exists that other persons or
entities, completely independently of either the Company or the Subsidiaries, or
any of their respective  employees or agents, could have developed trade secrets
or items of  technical  information  similar or identical to those of either the
Company or the Subsidiaries.  Neither the Company nor the Subsidiaries are aware
of any such  development  of similar or  identical  trade  secrets or  technical
information by others.



                                        9

<PAGE>

              u. Each of the Company and the  Subsidiaries  has taken reasonable
security  measures  to protect  the  secrecy,  confidentiality  and value of its
intellectual property in all material respects.

              v.  Each  of  the  Company  and  the  Subsidiaries  has  good  and
marketable title to, or valid and enforceable leasehold estates in, all items of
real and personal property stated in the Prospectus to be owned or leased by it,
free and clear of all liens, charges, claims,  encumbrances,  pledges,  security
interests,  defects,  or other  restrictions or equities of any kind whatsoever,
other than those  referred to in the  Prospectus and liens for taxes not yet due
and payable.

              w. Ernst & Young LLP, whose report is filed with the Commission as
a  part  of  the  Registration  Statement,   are  independent  certified  public
accountants as required by the Act and the Rules and Regulations.

              x. The Company has caused to be duly executed  legally binding and
enforceable  agreements  ("Lock-up  Agreements")  pursuant  to which each of the
officers and directors of the Company, all holders of more than 20,000 Shares of
Common Stock issued and  outstanding on the effective  date of the  Registration
Statement, and all holders of options, warrants or other securities exchangeable
or exercisable  for or convertible  into more than 20,000 Shares of Common Stock
issued and outstanding on the effective date of the  Registration  Statement has
agreed (i) not to, directly or indirectly,  issue,  offer,  offer to sell, sell,
grant  any  option  for the  sale or  purchase  of,  assign,  transfer,  pledge,
hypothecate  or  otherwise  encumber or dispose of any shares of Common Stock or
securities  convertible into,  exercisable or exchangeable for or evidencing any
right to purchase or subscribe for any shares of Common Stock  (either  pursuant
to Rule 144 of the  Rules  and  Regulations  or  otherwise)  or  dispose  of any
beneficial  interest  therein  for a period of not less than  twelve (12) months
following the effective  date of the  Registration  Statement  without the prior
written consent of National and Network 1 Financial  Securities,  Inc. ("Network
1") and 12 additional months without the consent of either National or Network 1
and (ii) to waive all rights to request or demand the  registration  pursuant to
the Act of any  securities of the Company which are registered in the name of or
beneficially  owned by any  such  holder.  The  Company  has also  used its best
efforts to cause all  holders of 200,000 or less Shares of Common  Stock  issued
and  outstanding  on the effective  date of the  Registration  Statement and all
holders of options,  warrants or other  securities  convertible,  exercisable or
exchangeable  for 200,000 or less Shares of Common Stock issued and  outstanding
on the  effective  date of the  Registration  Statement  to enter  into  Lock-up
Agreements. During the twenty-four (24) month period commencing on the effective
date of the  Registration  Statement,  the Company shall not,  without the prior
written consent of the  Representative,  sell, contract or offer to sell, issue,
transfer,  assign,  pledge,  distribute,  or otherwise  dispose of,  directly or
indirectly,  any shares of Common Stock or any options,  rights or warrants with
respect to any shares of Common  Stock,  except  pursuant to options,  rights or
warrants existing on the effective date of the Registration Statement; provided,
however, that the Company and any subsidiaries or affiliates thereof may sell or
offer for sale any of their securities without the consent of the Representative
in connection with any merger or acquisition transaction, joint venture or other
"corporate  partnering"  transaction  entered into by any of the Company and its
subsidiaries  or  affiliates.  The  Company  will cause the  Transfer  Agent (as
hereinafter defined) to mark an


                                       10

<PAGE>

appropriate  legend on the face of stock  certificates  representing all of such
securities and to place "stop transfer" orders on the Company's stock ledgers.

              y.  There are no  claims,  payments,  issuances,  arrangements  or
understandings,  whether  oral or  written,  for  services  in the  nature  of a
finder's or origination fee with respect to the sale of the Securities hereunder
or any other arrangements, agreements, understandings, payments or issuance with
respect to the Company,  the Subsidiaries,  or any of their respective officers,
directors, stockholders,  partners, employees or affiliates, that may affect the
Underwriters'  compensation,  as  determined  by  the  National  Association  of
Securities Dealers, Inc. ("NASD").

              z. The Common Stock has been  approved for quotation on the Nasdaq
National Market ("Nasdaq").

              aa.  None of the  Company,  the  Subsidiaries,  nor  any of  their
respective officers,  employees,  agents or any other person acting on behalf of
either the Company or the Subsidiaries  have,  directly or indirectly,  given or
agreed to give any  money,  gift or similar  benefit  (other  than  legal  price
concessions  to customers in the ordinary  course of business) to any  customer,
supplier,  employee or agent of a customer or supplier,  or official or employee
of any  governmental  agency  (domestic  or foreign) or  instrumentality  of any
government  (domestic or foreign) or any political party or candidate for office
(domestic  or foreign) or other  person who was,  is, or may be in a position to
help or hinder the business of either the Company or the Subsidiaries (or assist
either the Company or the Subsidiaries in connection with any actual or proposed
transaction) which (a) might subject either the Company or the Subsidiaries,  or
any other  such  person to any  damage or  penalty  in any  civil,  criminal  or
governmental litigation or proceeding (domestic or foreign), (b) if not given in
the past,  might have had a material  adverse effect on the assets,  business or
operations of either the Company or the Subsidiaries, or (c) if not continued in
the future, might adversely affect the assets, business, condition, financial or
otherwise,  earnings,  position,  properties,  value, operations or prospects of
either the Company or the  Subsidiaries.  The  Company's  and the  Subsidiaries'
internal accounting controls are sufficient to cause each of the Company and the
Subsidiaries  to comply  with the  Foreign  Corrupt  Practices  Act of 1977,  as
amended.

              bb. Except as set forth in the Prospectus,  no officer,  director,
stockholder or partner of the Company or of the Subsidiaries, or any "affiliate"
or  "associate"  (as these terms are defined in Rule 405  promulgated  under the
Rules and  Regulations)  of any of the foregoing  persons or entities has or has
had,  either  directly  or  indirectly,  (i) an interest in any person or entity
which (A) furnishes or sells services or products which are furnished or sold or
are proposed to be furnished or sold by either the Company or the  Subsidiaries,
or (B)  purchases  from or sells or  furnishes  to  either  the  Company  or the
Subsidiaries  any  goods or  services,  or (ii) a  beneficiary  interest  in any
contract or agreement to which the Company or the Subsidiaries are a party or by
which it may be bound or affected.  Except as set forth in the Prospectus  under
"Certain   Transactions,"  there  are  no  existing  agreements,   arrangements,
understandings   or   transactions,   or  proposed   agreements,   arrangements,
understandings   or   transactions,   between  or  among  the   Company  or  the
Subsidiaries, and any officer, director, or 5% or greater


                                       11

<PAGE>

securityholder of the Company or the Subsidiaries,  or any partner, affiliate or
associate of any of the foregoing persons or entities.

              cc. Any  certificate  signed by any  officer of the Company or the
Subsidiaries,  and delivered to the Underwriters or to Underwriters' Counsel (as
defined herein) shall be deemed a representation  and warranty by the Company to
the Underwriters as to the matters covered thereby.

              dd. The minute  books of each of the Company and the  Subsidiaries
have been made available to the  Underwriters  and contain a complete summary of
all meetings and actions of the  directors  (including  committees  thereof) and
stockholders of each of the Company and the  Subsidiaries,  since  [___________,
19__],  and reflect all transactions  referred to in such minutes  accurately in
all material respects.

              ee.  Except  and to the extent  described  in the  Prospectus,  no
holders of any  securities  of the Company or of any options,  warrants or other
convertible or exchangeable  securities of the Company have the right to include
any  securities  issued by the  Company  in the  Registration  Statement  or any
registration  statement  to be filed by the Company or to require the Company to
file a  registration  statement  under the Act and no person or entity holds any
anti-dilution rights with respect to any securities of the Company.

              ff. (A) Each of the Company and the  Subsidiaries is in compliance
with all  federal,  state,  local or foreign  laws,  common law,  rules,  codes,
administrative  orders or  regulations  relating to pollution or  protection  of
human health,  the  environment  (including,  without  limitation,  ambient air,
surface  water,  groundwater,  land surface or  subsurface  strata) or wildlife,
including without limitation, all laws, common law, rules, codes, administrative
orders  and  regulations  relating  to the  release  or  threatened  release  of
chemicals,  pollutants,   contaminants,   wastes,  toxic  substances,  hazardous
substances,   petroleum  or   petroleum   products   (collectively,   "Hazardous
Materials") or to the manufacture,  processing,  distribution,  use,  treatment,
storage,  disposal,  transport or handling of Hazardous Materials (collectively,
"Environmental Laws") and (B) to the best of the Company's knowledge,  there are
no events or circumstances that could form the basis of an order for clean-up or
remediation,  or  an  action,  suit  or  proceeding  by  any  private  party  or
governmental  body or agency,  against or  affecting  either the  Company or the
Subsidiaries  relating  to  any  Hazardous  Materials  or the  violation  of any
Environmental  Laws.  The  Company  has no  reason to  believe  that it will not
receive all necessary and required  approvals,  authorizations,  validations and
certifications  from the EPA and  other  applicable  regulatory  authorities  to
enable  the  Company  to  commence  full   operations  as  contemplated  in  the
Registration Statement and the Prospectus.

              gg. In the ordinary  course of its  business,  each of the Company
and the  Subsidiaries  conducts a periodic review of the effect of Environmental
Laws  on the  business,  operations  and  properties  of  the  Company  and  the
Subsidiaries,  in the course of which it  identifies  and  evaluates  associated
costs and liabilities (including,  without limitation,  any capital or operating
expenditures  required for clean-up,  closure of  properties or compliance  with
Environmental Laws or any permit,  license or approval,  any related constraints
on operating activities and any potential  liabilities to third parties). On the
basis of such review, each of the Company and the


                                       12

<PAGE>

Subsidiaries has reasonably concluded that such associated costs and liabilities
would not,  singly or in the  aggregate,  have a material  adverse effect on the
Company or the Subsidiaries.

              hh. The Company has as of the effective  date of the  Registration
Statement  (i) entered into an employment  agreement  with Glenn A. Norem in the
form filed as Exhibit ___ to the Registration  Statement and (ii) purchased term
key person life  insurance on the life of Mr. Norem in the amount of one million
($1,000,000), which policy names the Company as the sole beneficiary thereof.

              ii. As of the date  hereof,  the  Company  does not have more than
________________  shares of  Common  Stock  issued  and  outstanding  (including
securities  with  equivalent  rights as the  Common  Stock and  shares of Common
Stock,  or such  equivalent  securities,  issuable  upon exercise of any and all
options,  warrants and other contract rights and securities convertible directly
or indirectly  into shares of Common Stock or such  equivalent  securities,  but
excluding up to _____________  shares of Common Stock issuable upon the exercise
of options granted under the Company's 1993 Stock Option Plan, 1994 Stock Option
Plan, 1995 Employee Stock Purchase Plan and Director Stock Option Plan at prices
not less than the  higher of the  market  value of the shares at the date of the
grant or the offering price per share).

              jj. Each of the Company  and the  Subsidiaries  confirms as of the
date hereof that it is in compliance with all provisions of Section 1 of Laws of
Florida,  Chapter  92-198,  An Act Relating to Disclosure of Doing Business with
Cuba, and each of the Company and the Subsidiaries  further agrees that if it or
any affiliate commences engaging in business with the government of Cuba or with
any  person  or  affiliate  located  in Cuba  after  the date  the  Registration
Statement  becomes  or has  become  effective  with the  Commission  or with the
Florida Department of Banking and Finance (the "Department"),  whichever date is
later,  or if the  information  reported or  incorporated  by  reference  in the
Prospectus,   if  any,  concerning  the  Company's,  the  Subsidiaries'  or  any
affiliate's,  business with Cuba or with any person or affiliate located in Cuba
changes in any material way, the Company will provide the  Department  notice of
such business or change, as appropriate, in a form acceptable to the Department.

              kk. The  Company  is not,  and upon the  issuance  and sale of the
Securities  as  herein  contemplated  and the  application  of the net  proceeds
therefrom  as described  in the  Prospectus  under the caption "Use of Proceeds"
will not be, an "investment company" or an entity "controlled" by an "investment
company" as such terms are  defined in the  Investment  Company Act of 1940,  as
amended (the "1940 Act").

              ll. Each of the Company and the Subsidiaries maintains a system of
internal accounting controls sufficient to provide reasonable assurance that (i)
transactions  are executed in accordance with  management's  general or specific
authorizations;   (ii)   transactions   are  recorded  as  necessary  to  permit
preparation  of financial  statements  in  conformity  with  generally  accepted
accounting principles and to maintain accountability for assets; (iii) access to
assets is permitted  only in accordance  with  management's  general or specific
authorizations; and (iv) the recorded accountability for assets is compared with
the existing assets at reasonable intervals and appropriate action is taken with
respect to any differences.



                                       13

<PAGE>

              mm. The Company has entered into a warrant agreement substantially
in the form filed as Exhibit ____ to the  Registration  Statement  (the "Warrant
Agreement")  with the  Representative  and  Continental  Stock  Transfer & Trust
Company,   as  Warrant  Agent,  in  form  and  substance   satisfactory  to  the
Representative, with respect to the Redeemable Warrants.

        2.    Purchase, Sale and Delivery of the Securities.

              a. On the basis of the representations,  warranties, covenants and
agreements herein contained,  but subject to the terms and conditions herein set
forth,  the Company agrees to sell to each  Underwriter,  and each  Underwriter,
severally  and not  jointly,  agrees to purchase  from the Company at a price of
$_______ [90% of the public  offering  price] per Share and $_______ [90% of the
public  offering price] per Redeemable  Warrant,  that number of Firm Securities
set forth in Schedule A opposite the name of such  Underwriter,  subject to such
adjustment as the  Representative in its sole discretion shall make to eliminate
any sales or purchases of fractional shares,  plus any additional number of Firm
Securities which such  Underwriter may become obligated to purchase  pursuant to
the provisions of Section 11 hereof.

              b. In addition,  on the basis of the representations,  warranties,
covenants  and  agreements  herein  contained,  but  subject  to the  terms  and
conditions  herein  set  forth,  the  Company  hereby  grants  an  option to the
Underwriters,  severally  and not  jointly,  to  purchase  all or any part of an
additional  270,000  shares  of  Common  Stock at a price of $ ____  [90% of the
public  offering  price] per share of Common Stock and/or an additional  270,000
Redeemable Warrants at a price of $______ [90% of the public offering price] per
Redeemable  Warrant.  The option granted hereby will expire forty-five (45) days
after (i) the date the Registration Statement becomes effective,  if the Company
has  elected not to rely on Rule 430A under the Rules and  Regulations,  or (ii)
the date of this  Agreement  if the  Company  has elected to rely upon Rule 430A
under the Rules and  Regulations,  and may be exercised in whole or in part from
time to time only for the purpose of covering  over-allotments which may be made
in connection  with the offering and  distribution  of the Firm  Securities upon
notice by the  Representative  to the Company setting forth the number of Option
Securities as to which the several  Underwriters  are then exercising the option
and the time and date of payment and  delivery  for any such Option  Securities.
Any  such  time  and  date of  delivery  (an  "Option  Closing  Date")  shall be
determined  by the  Representative,  but shall not be later  than three (3) full
business  days after the exercise of said option,  nor in any event prior to the
Closing  Date,  as  hereinafter  defined,  unless  otherwise  agreed upon by the
Representative  and the Company.  Nothing  herein  contained  shall obligate the
Underwriters  to  make  any  over-allotments.  No  Option  Securities  shall  be
delivered unless the Firm Securities shall be simultaneously  delivered or shall
theretofore have been delivered as herein provided.

              c. Payment of the purchase price for, and delivery of certificates
for, the Firm Securities shall be made at the offices of the  Representative  at
1001 Fourth Avenue,  Suite 2200,  Seattle,  Washington  98154,  or at such other
place  as shall be  agreed  upon by the  Representative  and the  Company.  Such
delivery and payment  shall be made at 10:00 a.m. (New York City time) on , 1996
or at such other time and date as shall be agreed upon by the Representative and
the  Company,  but not less than three (3) nor more than five (5) full  business
days after the effective date of the Registration  Statement (such time and date
of payment and


                                       14

<PAGE>

delivery being herein called the "Closing Date"). In addition, in the event that
any or all of the Option Securities are purchased by the  Underwriters,  payment
of the  purchase  price for,  and  delivery  of  certificates  for,  such Option
Securities shall be made at the above-mentioned  office of the Representative or
at such  other  place as  shall be  agreed  upon by the  Representative  and the
Company  on each  Option  Closing  Date as  specified  in the  notice  from  the
Representative  to the  Company.  Delivery  of the  certificates  for  the  Firm
Securities and the Option Securities,  if any, shall be made to the Underwriters
against payment by the Underwriters,  severally and not jointly, of the purchase
price for the Firm Securities and the Option Securities, if any, to the order of
the Company for the Firm  Securities and the Option  Securities,  if any, by New
York Clearing  House funds.  In the event such option is exercised,  each of the
Underwriters,  acting severally and not jointly,  shall purchase that proportion
of the total number of Option  Securities  then being purchased which the number
of Firm  Securities  set forth in  Schedule A hereto  opposite  the name of such
Underwriter  bears to the total number of Firm Securities,  subject in each case
to such  adjustments  as the  Representative  in its  discretion  shall  make to
eliminate any sales or purchases of fractional shares. Certificates for the Firm
Securities and the Option  Securities,  if any,  shall be in  definitive,  fully
registered  form,  shall  bear  no  restrictive  legends  and  shall  be in such
denominations  and registered in such names as the  Underwriters  may request in
writing at least two (2) business days prior to the Closing Date or the relevant
Option  Closing  Date,  as the  case  may be.  The  certificates  for  the  Firm
Securities  and the Option  Securities,  if any,  shall be made available to the
Representative  at such  office or such other  place as the  Representative  may
designate for inspection,  checking and packaging no later than 9:30 a.m. on the
last business day prior to the Closing Date or the relevant Option Closing Date,
as the case may be.

              d. The  Underwriters  shall act as the Company's  exclusive  agent
with respect to the  solicitation of the Redeemable  Warrants,  and receive from
the Company a  commission  of five  percent  (5%) of the  exercise  price of the
Redeemable  Warrants  commencing  twelve (12) months after the  effective  date,
payable upon exercise.

              e. On the Closing  Date,  the Company  shall issue and sell to the
Representative  Representative's  Warrants  at a  purchase  price of $.0001  per
warrant,  which  Representative's  Warrants shall entitle the holders thereof to
purchase  an  aggregate  of  180,000  shares  of  Common  Stock  and/or  180,000
Redeemable Warrants.  The  Representative's  Warrants shall be exercisable for a
period of four (4) years  commencing one (1) year from the effective date of the
Registration  Statement at a price equaling one hundred twenty percent (120%) of
the respective  initial  public  offering price of the Shares and the Redeemable
Warrants. The Representative's Warrant Agreement and form of Warrant Certificate
shall be  substantially  in the form  filed as Exhibit  4.2 to the  Registration
Statement.  Payment  for  the  Representative's  Warrants  shall  be made on the
Closing Date.

        3. Public Offering of the Shares and Redeemable Warrants.  As soon after
the  Registration  Statement  becomes  effective  as  the  Representative  deems
advisable,  the  Underwriters  shall  make a public  offering  of the Shares and
Redeemable  Warrants (other than to residents of or in any jurisdiction in which
qualification  of the Shares and  Redeemable  Warrants is  required  and has not
become  effective)  at the  price  and upon the  other  terms  set  forth in the
Prospectus. The Representative may from time to time increase or decrease the


                                       15

<PAGE>

respective public offering price after distribution of the Shares and Redeemable
Warrants has been  completed to such extent as the  Representative,  in its sole
discretion  deems  advisable.  The  Underwriters  may  enter  into  one of  more
agreements as the Underwriters, in each of their sole discretion, deem advisable
with one or more broker-dealers who shall act as dealers in connection with such
public offering.

        4.  Covenants and Agreements of the Company.  The Company  covenants and
agrees with each of the Underwriters as follows:

              a.  The  Company   shall  use  its  best   efforts  to  cause  the
Registration  Statement  and any  amendments  thereto  to  become  effective  as
promptly as  practicable  and will not at any time,  whether before or after the
effective  date  of  the  Registration  Statement,  file  any  amendment  to the
Registration  Statement or  supplement  to the  Prospectus  or file any document
under the Act or Exchange Act before  termination  of the offering of the Shares
and Redeemable  Warrants by the Underwriters of which the  Representative  shall
not  previously  have been advised and  furnished  with a copy,  or to which the
Representative  shall have objected or which is not in compliance  with the Act,
the Exchange Act or the Rules and Regulations.

              b. As soon as the Company is advised or obtains knowledge thereof,
the Company will advise the Representative and confirm the notice in writing (i)
when  the  Registration  Statement,  as  amended,   becomes  effective,  if  the
provisions of Rule 430A promulgated  under the Act will be relied upon, when the
Prospectus  has been  filed  in  accordance  with  said  Rule  430A and when any
post-effective  amendment to the Registration Statement becomes effective;  (ii)
of the issuance by the Commission of any stop order or of the initiation, or the
threatening,  of any proceeding suspending the effectiveness of the Registration
Statement  or any order  preventing  or  suspending  the use of the  Preliminary
Prospectus or the  Prospectus,  or any amendment or supplement  thereto,  or the
institution  of  proceedings  for that  purpose;  (iii) of the  issuance  by the
Commission  or by any state  securities  commission of any  proceedings  for the
suspension of the qualification of any of the Securities for offering or sale in
any jurisdiction or of the initiation, or the threatening, of any proceeding for
that purpose;  (iv) of the receipt of any comments from the Commission;  and (v)
of any request by the Commission for any amendment to the Registration Statement
or any amendment or supplement to the Prospectus or for additional  information.
If the Commission or any state securities commission shall enter a stop order or
suspend such  qualification  at any time,  the Company will make every effort to
obtain promptly the lifting of such order.

              c. The Company  shall file the  Prospectus  (in form and substance
satisfactory  to the  Representative)  or  transmit  the  Prospectus  by a means
reasonably  calculated to result in filing with the Commission  pursuant to Rule
424(b)(1) (or, if applicable and if consented to by the Representative, pursuant
to Rule  424(b)(4))  not later than the  Commission's  close of  business on the
earlier of (i) the second  business day  following the execution and delivery of
this  Agreement and (ii) the fifth  business day after the effective date of the
Registration Statement.

              d.  The  Company  will  give  the  Representative  notice  of  its
intention  to  file or  prepare  any  amendment  to the  Registration  Statement
(including any  post-effective  amendment) or any amendment or supplement to the
Prospectus (including any revised prospectus which the


                                       16

<PAGE>

Company  proposes for use by the Underwriters in connection with the offering of
the Securities  which differs from the  corresponding  prospectus on file at the
Commission at the time the Registration Statement becomes effective,  whether or
not such revised  prospectus is required to be filed  pursuant to Rule 424(b) of
the Rules and Regulations),  and will furnish the Representative  with copies of
any such  amendment  or  supplement  a  reasonable  amount of time prior to such
proposed  filing  or use,  as the  case  may be,  and  will  not  file  any such
prospectus  to which the  Representative  or Orrick,  Herrington & Sutcliffe LLP
("Underwriters' Counsel") shall object.

              e. The Company shall endeavor in good faith,  in cooperation  with
the Representative,  at or prior to the time the Registration  Statement becomes
effective,  to qualify the Securities for offering and sale under the securities
laws of such  jurisdictions  as the  Representative  may designate to permit the
continuance  of sales and  dealings  therein for as long as may be  necessary to
complete the distribution, and shall make such applications, file such documents
and furnish  such  information  as may be required for such  purpose;  provided,
however,  the Company shall not be required to qualify as a foreign  corporation
or file a  general  or  limited  consent  to  service  of  process  in any  such
jurisdiction.  In each jurisdiction where such qualification  shall be effected,
the Company will,  unless the  Representative  agrees that such action is not at
the time  necessary or advisable,  use all  reasonable  efforts to file and make
such statements or reports at such times as are or may reasonably be required by
the laws of such jurisdiction to continue such qualification.

              f. During the time when a  prospectus  is required to be delivered
under the Act, the Company shall use all  reasonable  efforts to comply with all
requirements  imposed  upon  it by the  Act and  the  Exchange  Act,  as now and
hereafter  amended  and by the  Rules and  Regulations,  as from time to time in
force,  so far as necessary to permit the continuance of sales of or dealings in
the Securities in accordance with the provisions  hereof and the Prospectus,  or
any amendments or supplements thereto. If at any time when a prospectus relating
to the  Securities  is required to be  delivered  under the Act, any event shall
have occurred as a result of which, in the opinion of counsel for the Company or
Underwriters' Counsel, the Prospectus, as then amended or supplemented, includes
an untrue  statement  of a  material  fact or omits to state any  material  fact
required to be stated  therein or necessary to make the statements  therein,  in
the light of the circumstances under which they were made, not misleading, or if
it is necessary at any time to amend the  Prospectus to comply with the Act, the
Company  will notify the  Representative  promptly and prepare and file with the
Commission an appropriate  amendment or supplement in accordance with Section 10
of  the  Act,  each  such  amendment  or  supplement  to  be   satisfactory   to
Underwriters'  Counsel,  and the Company will furnish to the Underwriters copies
of such  amendment or supplement as soon as available and in such  quantities as
the Underwriters may request.

              g.  As  soon as  practicable,  but in any  event  not  later  than
forty-five (45) days after the end of the 12-month  period  beginning on the day
after the end of the fiscal  quarter of the Company  during which the  effective
date of the  Registration  Statement  occurs (ninety (90) days in the event that
the end of such fiscal  quarter is the end of the Company's  fiscal  year),  the
Company shall make generally  available to its security  holders,  in the manner
specified   in  Rule   158(b)  of  the  Rules  and   Regulations,   and  to  the
Representative, an earnings statement which will


                                       17

<PAGE>

be in the detail required by, and will otherwise  comply with, the provisions of
Section  11(a) of the Act and Rule  158(a) of the Rules and  Regulations,  which
statement need not be audited unless  required by the Act,  covering a period of
at  least  twelve  (12)  consecutive  months  after  the  effective  date of the
Registration Statement.

              h. During a period of seven (7) years after the date  hereof,  the
Company will furnish to its stockholders, as soon as practicable, annual reports
(including  financial  statements audited by independent public accountants) and
unaudited quarterly reports of earnings, and will deliver to the Representative:

               i.  concurrently  with furnishing  such quarterly  reports to its
        stockholders,  statements  of income of the Company for each  quarter in
        the form  furnished to the Company's  stockholders  and certified by the
        Company's principal financial or accounting officer;

              ii.  concurrently  with  furnishing  such  annual  reports  to its
        stockholders,  a  balance  sheet  of the  Company  as at the  end of the
        preceding   fiscal  year,   together  with   statements  of  operations,
        stockholders'  equity,  and cash flows of the  Company  for such  fiscal
        year,  accompanied by a copy of the  certificate  thereon of independent
        certified public accountants;

             iii.  as  soon  as  they  are  available,  copies  of  all  reports
        (financial or other) mailed to stockholders;

              iv.  as soon as they are  available,  copies  of all  reports  and
        financial statements furnished to or filed with the Commission, the NASD
        or any securities exchange;

               v. every press release and every material news item or article of
        interest to the  financial  community in respect of the Company,  or its
        affairs,  which was released or prepared by or on behalf of the Company;
        and

              vi. any additional  information of a public nature  concerning the
        Company  (and  any  future  subsidiary)  or  its  businesses  which  the
        Representative may request.

        During such seven-year  period, if the Company has an active subsidiary,
the foregoing financial statements will be on a consolidated basis to the extent
that the accounts of the Company and its subsidiary(ies)  are consolidated,  and
will  be  accompanied  by  similar  financial  statements  for  any  significant
subsidiary which is not so consolidated.

              i. The Company will  maintain a transfer  agent and warrant  agent
("Transfer  Agent") and, if necessary under the jurisdiction of incorporation of
the Company,  a Registrar  (which may be the same entity as the Transfer  Agent)
for its Common Stock and Redeemable Warrants.

              j.  The  Company  will  furnish  to the  Representative  or on the
Representative's  order, without charge, at such place as the Representative may
designate, copies of each Preliminary Prospectus, the Registration Statement and
any pre-effective or post-effective amendments thereto (two of which copies will
be signed and will include all financial statements and


                                       18

<PAGE>

exhibits), the Prospectus, and all amendments and supplements thereto, including
any prospectus prepared after the effective date of the Registration  Statement,
in each case as soon as available and in such  quantities as the  Representative
may request.

              k. On or before the effective date of the Registration  Statement,
the Company shall provide the  Representative  with true original copies of duly
executed,  legally binding and enforceable Lock-up Agreements pursuant to which,
for a period of twelve (12) months from the effective  date of the  Registration
Statement,  each of the Company's  officers and  directors,  all holders of more
than 20,000 Shares of Common Stock issued and  outstanding on the effective date
of the  Registration  Statement,  and all holders of options,  warrants or other
securities  exchangeable  or  exercisable  for or  convertible  into more of the
Common Stock issued and  outstanding on the effective  date of the  Registration
Statement  agrees  that it or he or she (i) will not,  directly  or  indirectly,
issue, offer to sell, sell, grant an option for the sale or purchase of, assign,
transfer,  pledge, hypothecate or otherwise encumber or dispose of any shares of
Common Stock or securities  convertible into, exercisable or exchangeable for or
evidencing  any right to purchase or  subscribe  for any shares of Common  Stock
(either  pursuant  to Rule 144 of the Rules and  Regulations  or  otherwise)  or
dispose of any beneficial interest therein without the prior consent of National
and  Network 1 and for twelve  (12)  additional  months  without  the consent of
either  National  or Network 1 and (ii)  waives any and all rights to request or
demand the  registration  pursuant to the Act, of any  securities of the Company
which are  registered in the name of or  beneficially  owned by it or he or she,
respectively. The Company will also use its best efforts to cause all holders of
20,000 or less Shares of Common Stock issued and  outstanding  on the  effective
date of the Registration Statement and all holders of options, warrants or other
securities convertible, exercisable or exchangeable for less than 20,000 or less
Shares of Common  Stock  issued and  outstanding  on the  effective  date of the
Registration Statement to enter into Lock-up Agreements.  During the twenty-four
(24)  month  period  commencing  on  the  effective  date  of  the  Registration
Statement,  the  Company  shall not,  without the prior  written  consent of the
Representative,  sell,  contract  or  offer to sell,  issue,  transfer,  assign,
pledge,  distribute, or otherwise dispose of, directly or indirectly, any shares
of Common Stock or any options, rights or warrants with respect to any shares of
Common Stock,  except  pursuant to options,  rights or warrants  existing on the
effective  date of the  Registration  Statement;  provided,  however,  that  the
Company and any  subsidiaries  or affiliates  thereof may sell or offer for sale
any of their securities  without the consent of the Representative in connection
with any merger or acquisition  transaction,  joint venture or other  "corporate
partnering"  transaction entered into by any of the Company and its subsidiaries
or  affiliates.  On or before  the  Closing  Date,  the  Company  shall  deliver
instructions to the Transfer Agent authorizing it to place  appropriate  legends
on  the  certificates   representing  the  securities  subject  to  the  Lock-up
Agreements  and to place  appropriate  stop  transfer  orders  on the  Company's
ledgers.

              l.  None  of the  Company,  the  Subsidiaries,  nor  any of  their
respective  officers,  directors,  stockholders,  nor  any of  their  respective
affiliates (within the meaning of the Rules and Regulations) will take, directly
or indirectly,  any action designed to, or which might in the future  reasonably
be expected to cause or result in, stabilization or manipulation of the price of
any securities of the Company.



                                       19

<PAGE>

              m. The Company  shall apply the net proceeds  from the sale of the
Securities in the manner, and subject to the conditions, set forth under "Use of
Proceeds"  in the  Prospectus.  No  portion  of the net  proceeds  will be used,
directly or indirectly, to acquire any securities issued by the Company.

              n. The Company shall timely file all such reports,  forms or other
documents as may be required (including, but not limited to, a Form SR as may be
required  pursuant to Rule 463 under the Act) from time to time,  under the Act,
the Exchange Act, and the Rules and Regulations, and all such reports, forms and
documents  filed  will  comply  as to form and  substance  with  the  applicable
requirements under the Act, the Exchange Act, and the Rules and Regulations.

              o. The Company  shall  furnish to the  Representative  as early as
practicable  prior to each of the date hereof,  the Closing Date and each Option
Closing  Date,  if any,  but no  later  than two (2) full  business  days  prior
thereto, a copy of the latest available  unaudited interim financial  statements
of the  Company  (which in no event  shall be as of a date more than thirty (30)
days prior to the date of the  Registration  Statement)  which have been read by
the Company's  independent public accountants,  as stated in their letters to be
furnished pursuant to Sections 6(l) and 6(m) hereof.

              p. The  Company  shall  cause  the  Common  Stock  and  Redeemable
Warrants  to be quoted on Nasdaq  and,  for a period of seven (7) years from the
date hereof, use its best efforts to maintain the Nasdaq quotation of the Common
Stock and the Redeemable Warrants to the extent outstanding.

              q. For a period  of five (5)  years  from the  Closing  Date,  the
Company shall furnish to the  Representative at the Company's sole expense,  (i)
daily  consolidated  transfer sheets relating to the Common Stock and Redeemable
Warrants (ii) the list of holders of all of the Company's securities and (iii) a
Blue Sky  "Trading  Survey"  for  secondary  sales of the  Company's  securities
prepared by counsel to the Company.

              r. As soon as practicable,  (i) but in no event more than five (5)
business days before the effective date of the  Registration  Statement,  file a
Form 8-A with the Commission  providing for the registration  under the Exchange
Act of the  Securities and (ii) but in no event more than thirty (30) days after
the  effective  date of the  Registration  Statement,  take  all  necessary  and
appropriate   actions  to  be  included  in  Standard  and  Poor's   Corporation
Descriptions  and Moody's OTC Manual and to continue such inclusion for a period
of not less than seven (7) years.

              s. The Company  hereby  agrees  that it will not,  for a period of
twelve (12) months from the effective date of the Registration Statement, adopt,
propose to adopt or otherwise permit to exist any employee,  officer,  director,
consultant or compensation plan or similar arrangement permitting (i) the grant,
issue,  sale or entry into any  agreement  to grant,  issue or sell any  option,
warrant or other  contract  right (x) at an exercise price that is less than the
greater of the public offering price of the Shares set forth herein and the fair
market  value  on the  date of  grant  or  sale  or (y) to any of its  executive
officers or directors or to any holder of 5% or more of the Common Stock, except
as provided in subsection (ii) of this subparagraph;


                                       20

<PAGE>

(ii) the maximum  number of shares of Common  Stock or other  securities  of the
Company  purchasable  at any time pursuant to options or warrants  issued by the
Company to exceed those _____  shares  reserved  for future  issuance  under the
Company's 1995 Option Plan,  1994 Option Plan,  1993 Option Plan, 1995 Directors
Stock Option Plan and the Employee  Stock Purchase Plan as described in footnote
one (1) to the  "Prospectus  Summary - The Offering"  section of the Prospectus;
(iii) the payment for such securities with any form of consideration  other than
cash; or (iv) the existence of stock  appreciation  rights,  phantom  options or
similar arrangements.

              t. Until the completion of the distribution of the Securities, the
Company shall not, without the prior written consent of the  Representative  and
Underwriters' Counsel, issue, directly or indirectly, any press release or other
communication  or hold any press  conference  with respect to the Company or its
activities or the offering contemplated hereby, other than trade releases issued
in the ordinary course of the Company's business  consistent with past practices
with respect to the Company's operations.

              u. For a period  equal to the  lesser of (i) seven (7) years  from
the  date  hereof,  and  (ii) the  sale to the  public  of the  Representative's
Securities, the Company will not take any action or actions which may prevent or
disqualify  the Company's use of Form SB-2 (or other  appropriate  form) for the
registration  under  the Act of the  Representative's  Securities.  The  Company
further agrees to use its best efforts to file such post-effective amendments to
the  Registration  Statement,  as may be  necessary,  in order to  maintain  its
effectiveness and to keep such Registration Statement effective while any of the
Redeemable Warrants or Representative's Warrants remain outstanding.

              v. At the effective date of the Registration Statement and on each
of the Closing Date and each Option Closing Date, if any, the Company shall have
obtained all  necessary  and  required  approvals,  authorizations,  franchises,
licenses, orders, permits,  validations and certifications from all domestic and
foreign  regulatory  authorities  required to conduct its  business as presently
conducted  and  described  in  the  Prospectus,  and  none  of  such  approvals,
authorizations,   franchises,   licenses,   orders,  permits,   validations  and
certifications shall have been revoked,  restricted or limited in any manner and
all of such approvals,  authorizations,  franchises,  licenses, orders, permits,
validations and certifications  shall be in full force and effect on each of the
effective date of the Registration  Statement,  the Closing Date and each Option
Closing Date, if any.

              w. The Company  hereby agrees that the  Underwriters  may nominate
for election one person to the Company's Board of Directors  (which person shall
be  reasonably  acceptable  to the Company) for a period of three (3) years from
the  Effective  Date and that certain of the Company's  officers,  directors and
stockholders  have agreed to vote their  shares of common stock in favor of such
designee.  In the event the Underwriters elects not to exercise the right as set
forth in this paragraph,  then the  Underwriters may designate one person (which
person shall be reasonably  acceptable to the Company) to attend meetings of the
Company's  Board of Directors and a non-voting  advisor.  Such designee shall be
entitled to attend all such meetings of the Company's  Board of Directors and to
receive all  notices and other  correspondence  and  communications  sent by the
Company to members of its Board of Directors. The Company shall


                                       21

<PAGE>

reimburse  designees  of the  Representative  for their  out-of-pocket  expenses
incurred in connection with their  attendance of meetings of the Company's Board
of Directors.

        5.    Payment of Expenses.

              a. The Company  hereby  agrees to pay on each of the Closing  Date
and the Option  Closing  Date (to the extent not paid at the  Closing  Date) all
expenses and fees (other than fees of Underwriters' Counsel,  except as provided
in (iv) below)  incident to the  performance  of the  obligations of the Company
under this Agreement,  the Warrant  Agreement and the  Representative's  Warrant
Agreement,   including,  without  limitation,  (i)  the  fees  and  expenses  of
accountants and counsel for the Company, (ii) all costs and expenses incurred in
connection with the preparation,  duplication,  printing  (including mailing and
handling  charges),  filing,  delivery  and  mailing  (including  the payment of
postage with respect thereto) of the  Registration  Statement and the Prospectus
and any amendments and supplements thereto and the printing,  mailing (including
the payment of postage with respect thereto) and delivery of this Agreement, the
Warrant Agreement,  the Representative's  Warrant Agreement, the Agreement Among
Underwriters,  the Selected Dealer Agreements, and related documents,  including
the cost of all copies thereof and of the  Preliminary  Prospectuses  and of the
Prospectus and any amendments  thereof or  supplements  thereto  supplied to the
Underwriters and such dealers as the Underwriters may request,  in quantities as
hereinabove stated, (iii) the printing,  engraving, issuance and delivery of the
Securities  including,  but not limited to, (x) the purchase by the Underwriters
of the  Firm  Securities  and the  Option  Securities  and the  purchase  by the
Representative  of the  Representative's  Warrants  from  the  Company,  (y) the
consummation by the Company of any of its obligations under this Agreement,  the
Warrant Agreement and the Representative's  Warrant Agreement, and (z) resale of
the Firm Securities and the Option  Securities by the Underwriters in connection
with  the  distribution  contemplated  hereby,  (iv)  the  qualification  of the
Securities   under  state  or  foreign   securities   or  "Blue  Sky"  laws  and
determination  of the status of such  securities  under legal  investment  laws,
including  the  costs  of  printing  and  mailing  the  "Preliminary   Blue  Sky
Memorandum",  the  "Supplemental  Blue Sky  Memorandum"  and "Legal  Investments
Survey," if any, and disbursements and fees of counsel in connection  therewith,
(v)  advertising  costs and  expenses,  including  but not  limited to costs and
expenses  in  connection  with  the  "road  show",   information   meetings  and
presentations,   bound  volumes  and  prospectus  memorabilia  and  "tomb-stone"
advertisement expenses; (vi) costs and expenses in connection with due diligence
investigations,  including  but  not  limited  to the  fees  of any  independent
counsel, expert or consultant retained,  (vii) fees and expenses of the Transfer
Agent  and  registrar  and  all  issue  and  transfer   taxes,  if  any,  (viii)
applications  for assignment of a rating of the  Securities by qualified  rating
agencies, (ix) the fees payable to the Commission and the NASD, and (x) the fees
and expenses  incurred in  connection  with the  quotation of the  Securities on
Nasdaq and any other  exchange.  It is agreed  that the  services to be provided
under clause (iv) of the foregoing  sentence shall be performed by Underwriters'
Counsel.

              b.  If  this  Agreement  is  terminated  by  the  Underwriters  in
accordance  with the  provisions  of Section 6 or Section 12, the Company  shall
reimburse and indemnify the Underwriters  for all of their actual  out-of-pocket
expenses,  including the fees and disbursements of Underwriters'  Counsel,  less
any amounts  already paid  pursuant to Section 5(c) hereof;  provided,  however,
that the Representative will refund to the Company any unaccounted-for


                                       22

<PAGE>

portion of any amounts  already  advanced  by the Company to the  Representative
pursuant to Section 5(c) hereof.  In addition,  the Company  shall remain liable
for all Blue Sky counsel fees and disbursements, expenses and filing fees.

              c. The Company  further  agrees that,  in addition to the expenses
payable  pursuant  to  subsection  (a) of this  Section  5,  it will  pay to the
Representative  on the Closing Date by certified or bank cashier's  check or, at
the  election  of the  Representative,  by  deduction  from the  proceeds of the
offering contemplated herein, a non-accountable expense allowance equal to three
percent (3%) of the gross proceeds  received by the Company from the sale of the
Firm  Securities,  $25,000  of which  has been  paid to date.  In the  event the
Representative elects to exercise the over-allotment option described in Section
2(b)  hereof,  the  Company  agrees to pay to the  Representative  on the Option
Closing Date (by certified or bank cashier's  check or, at the  Representative's
election,  by  deduction  from the proceeds of the  offering) a  non-accountable
expense  allowance equal to three percent (3%) of the gross proceeds received by
the Company from the sale of the Option Securities.

        6. Conditions of the Underwriters'  Obligations.  The obligations of the
Underwriters  hereunder  shall be  subject  to the  continuing  accuracy  of the
representations  and  warranties of the Company herein as of the date hereof and
as of the Closing Date and each Option Closing Date, if any, as if they had been
made on and as of the Closing Date or each Option  Closing Date, as the case may
be; the accuracy on and as of the Closing Date or Option  Closing  Date, if any,
of the statements of the officers of the Company made pursuant to the provisions
hereof;  and the  performance  by the Company on and as of the Closing  Date and
each Option Closing Date, if any, of its covenants and obligations hereunder and
to the following further conditions:

              a. The  Registration  Statement  shall have become  effective  not
later than 12:00  P.M.,  New York time,  on the date of this  Agreement  or such
later date and time as shall be consented  to in writing by the  Representative,
and, at the Closing  Date and each Option  Closing  Date,  if any, no stop order
suspending  the  effectiveness  of the  Registration  Statement  shall have been
issued and no proceedings  for that purpose shall have been  instituted or shall
be pending or  contemplated by the Commission and any request on the part of the
Commission  for  additional  information  shall have been  complied  with to the
reasonable  satisfaction of Underwriters' Counsel. If the Company has elected to
rely upon Rule 430A of the Rules and  Regulations,  the price of the  Shares and
Redeemable  Warrants and any price-related  information  previously omitted from
the effective  Registration Statement pursuant to such Rule 430A shall have been
transmitted to the  Commission  for filing  pursuant to Rule 424(b) of the Rules
and  Regulations  within the  prescribed  time period and,  prior to the Closing
Date,   the  Company  shall  have   provided   evidence   satisfactory   to  the
Representative  of such timely filing, or a post-effective  amendment  providing
such  information  shall have been  promptly  filed and  declared  effective  in
accordance with the requirements of Rule 430A of the Rules and Regulations.

              b. The Representative  shall not have advised the Company that the
Registration Statement,  or any amendment thereto,  contains an untrue statement
of fact which, in the Representative's opinion, is material, or omits to state a
fact which, in the  Representative's  opinion, is material and is required to be
stated therein or is necessary to make the statements  therein,  in light of the
circumstances under which they were made, not misleading, or that the


                                       23

<PAGE>

Prospectus,  or any  supplement  thereto,  contains an untrue  statement of fact
which, in the  Representative's  opinion, is material,  or omits to state a fact
which, in the Representative's opinion, is material and is required to be stated
therein  or is  necessary  to make  the  statements  therein,  in  light  of the
circumstances under which they were made, not misleading.

              c. On or prior to each of the Closing Date and each Option Closing
Date, if any, the Representative shall have received from Underwriters' Counsel,
such opinion or opinions with respect to the  organization  of the Company,  the
validity of the Securities, the Registration Statement, the Prospectus and other
related  matters as the  Representative  may request and  Underwriters'  Counsel
shall have received such papers and  information  as they request to enable them
to pass upon such matters.

              d. At the Closing Date, the  Underwriters  shall have received the
favorable  opinion of the Stoppelman Law Firm, P.C.,  counsel to the Company and
the Subsidiaries,  dated the Closing Date,  addressed to the Underwriters and in
form and substance satisfactory to Underwriters' Counsel, to the effect that:

              i.  each of the  Company  and the  Subsidiaries  (A) has been duly
        organized  and is validly  existing as a  corporation  in good  standing
        under the laws of its  jurisdiction,  (B) is duly qualified and licensed
        and in good standing as a foreign  corporation in each  jurisdiction  in
        which its ownership or leasing of any properties or the character of its
        operations  requires such  qualification  or licensing,  and (C) has all
        requisite  corporate  power and authority,  and has obtained any and all
        necessary  authorizations,  approvals,  orders, licenses,  certificates,
        franchises  and  permits  of and from  all  governmental  or  regulatory
        officials  and  bodies  (including,  without  limitation,  those  having
        jurisdiction over environmental or similar matters), to own or lease its
        properties and conduct its business as described in the Prospectus; each
        of the Company and the  Subsidiaries  is and has been doing  business in
        compliance with all such authorizations,  approvals,  orders,  licenses,
        certificates,  franchises and permits and all federal,  state, local and
        foreign laws,  rules and  regulations;  and, neither the Company nor the
        Subsidiaries  has  received  any notice of  proceedings  relating to the
        revocation or modification of any such authorization,  approval,  order,
        license,  certificate,  franchise,  or  permit  which,  singly or in the
        aggregate, if the subject of an unfavorable decision, ruling or finding,
        would materially adversely affect the business,  operations,  condition,
        financial or otherwise,  or the earnings,  business  affairs,  position,
        prospects,  value,  operation,   properties,   business  or  results  of
        operations  of the  Company  and the  Subsidiaries  taken as whole.  The
        disclosures  in the  Registration  Statement  concerning  the effects of
        federal, state, local and foreign laws, rules and regulations on each of
        the Company's and the  Subsidiaries'  businesses as currently  conducted
        and as contemplated are correct in all material respects and do not omit
        to state a fact  required to be stated  therein or necessary to make the
        statements   contained   therein   not   misleading   in  light  of  the
        circumstances in which they were made.

              ii. The Company owns, directly or indirectly,  one hundred percent
        (100%) of the  outstanding  capital stock of the  Subsidiaries,  and all
        such shares have been validly issued, are fully paid and non-assessable,
        were not issued in violation of any preemptive rights


                                       24

<PAGE>

        and  are  owned   free  and  clear  of  any  liens,   charges,   claims,
        encumbrances, pledges, security interests, defects or other restrictions
        or equities of any kind whatsoever;

             iii. except as described in the Prospectus, neither the Company nor
        the Subsidiaries own an interest in any other corporation,  partnership,
        joint venture, trust or other business entity;

              iv. the  Company  has a duly  authorized,  issued and  outstanding
        capitalization  as set forth in the  Prospectus,  and any  amendment  or
        supplement  thereto,  under  "CAPITALIZATION",  and the Company is not a
        party to or  bound by any  instrument,  agreement  or other  arrangement
        providing  for it to issue,  sell,  transfer,  purchase  or  redeem  any
        capital stock, rights, warrants, options or other securities, except for
        this Agreement,  the Warrant Agreement and the Representative's  Warrant
        Agreement and as described in the  Prospectus.  The  Securities  and all
        other  securities  issued or  issuable  by the  Company  conform  in all
        material  respects to all statements with respect  thereto  contained in
        the   Registration   Statement  and  the  Prospectus.   All  issued  and
        outstanding  securities  of the Company  have been duly  authorized  and
        validly  issued  and are  fully  paid and  non-assessable;  the  holders
        thereof have no rights of rescission with respect  thereto,  and are not
        subject to personal liability by reason of being such holders;  and none
        of such securities were issued in violation of the preemptive  rights of
        any holders of any security of the Company or any similar rights granted
        by the Company.  The Securities to be sold by the Company  hereunder and
        under the Warrant Agreement and the  Representative's  Warrant Agreement
        are not and will  not be  subject  to any  preemptive  or other  similar
        rights of any  stockholder,  have been duly authorized and, when issued,
        paid for and  delivered in  accordance  with the terms  hereof,  will be
        validly  issued,  fully  paid  and  non-assessable  and  conform  to the
        description  thereof  contained in the  Prospectus;  the holders thereof
        will  not be  subject  to any  liability  solely  as such  holders;  all
        corporate action required to be taken for the  authorization,  issue and
        sale  of the  Securities  has  been  duly  and  validly  taken;  and the
        certificates representing the Securities are in due and proper form. The
        Representative's  Warrants and the Redeemable  Warrants constitute valid
        and binding  obligations of the Company to issue and sell, upon exercise
        thereof and payment  therefor,  the number and type of securities of the
        Company called for thereby.  Upon the issuance and delivery  pursuant to
        this Agreement of the Firm Securities and the Option  Securities and the
        Representative's  Warrants to be sold by the Company,  the  Underwriters
        and the Representative,  respectively,  will acquire good and marketable
        title  to  the  Firm  Securities  and  the  Option  Securities  and  the
        Representative's  Warrants free and clear of any pledge,  lien,  charge,
        claim,  encumbrance,  pledge, security interest, or other restriction or
        equity of any kind  whatsoever.  No  transfer  tax is  payable  by or on
        behalf of the  Underwriters  in connection  with (A) the issuance by the
        Company of the Securities,  (B) the purchase by the Underwriters and the
        Representative  of the Firm Securities and the Option Securities and the
        Representative's  Warrants,  respectively,  from  the  Company,  (C) the
        consummation  by  the  Company  of any of  its  obligations  under  this
        Agreement,   the  Warrant  Agreement  or  the  Representative's  Warrant
        Agreement,  or (D)  resales  of  the  Firm  Securities  and  the  Option
        Securities in connection with the distribution contemplated hereby.



                                       25

<PAGE>

              v. the Registration  Statement is effective under the Act, and, if
        applicable,  filing of all pricing  information  has been timely made in
        the appropriate  form under Rule 430A, and no stop order  suspending the
        use  of  the  Preliminary  Prospectus,  the  Registration  Statement  or
        Prospectus or any part of any thereof or suspending the effectiveness of
        the  Registration  Statement has been issued and no proceedings for that
        purpose  have been  instituted  or are  pending  or, to the best of such
        counsel's knowledge, threatened or contemplated under the Act;

              vi.  each  of  the  Preliminary   Prospectus,   the   Registration
        Statement,  and the Prospectus and any amendments or supplements thereto
        (other than the financial statements and other financial and statistical
        data included  therein,  as to which no opinion need be rendered) comply
        as to form in all material respects with the requirements of the Act and
        the Rules and Regulations.

              vii.  to the best of such  counsel's  knowledge,  (A) there are no
        agreements,  contracts  or  other  documents  required  by the Act to be
        described in the Registration  Statement and the Prospectus and filed as
        exhibits to the Registration Statement other than those described in the
        Registration  Statement  (or required to be filed under the Exchange Act
        if upon such filing they would be incorporated,  in whole or in part, by
        reference therein) and the Prospectus and filed as exhibits thereto, and
        the exhibits  which have been filed are correct  copies of the documents
        of  which  they  purport  to be  copies;  (B)  the  descriptions  in the
        Registration   Statement  and  the  Prospectus  and  any  supplement  or
        amendment  thereto of contracts and other documents to which the Company
        or the Subsidiaries  are a party or by which it is bound,  including any
        document  to which the  Company  or the  Subsidiaries  are a party or by
        which it is bound, incorporated by reference into the Prospectus and any
        supplement or amendment  thereto,  are accurate and fairly represent the
        information  required to be shown by Form SB-2;  (C) there is no action,
        arbitration,  suit,  proceeding,  inquiry,  investigation,   litigation,
        governmental or other proceeding (including,  without limitation,  those
        having jurisdiction over environmental or similar matters),  domestic or
        foreign,  pending or threatened  against (or circumstances that may give
        rise to the same), or involving the properties or business of either the
        Company or the Subsidiaries which (x) is required to be disclosed in the
        Registration  Statement which is not so disclosed (and such  proceedings
        as  are  summarized  in  the   Registration   Statement  are  accurately
        summarized in all  respects),  (y) questions the validity of the capital
        stock of the Company or this  Agreement,  the Warrant  Agreement  or the
        Representative's  Warrant  Agreement,  or of any  action  taken or to be
        taken  by the  Company  pursuant  to or in  connection  with  any of the
        foregoing;  (D) no  statute  or  regulation  or  legal  or  governmental
        proceeding  required to be described in the  Prospectus is not described
        as required;  and (E) there is no action, suit or proceeding pending, or
        threatened,  against or affecting either the Company or the Subsidiaries
        before any court or arbitrator or governmental  body, agency or official
        (or any  basis  thereof  known  to such  counsel)  in  which  there is a
        reasonable  possibility  of a  decision  which may  result in a material
        adverse  change  in  the  condition,  financial  or  otherwise,  or  the
        earnings, position,  prospects,  stockholders' equity, value, operation,
        properties,  business or results of  operations of either the Company or
        the   Subsidiaries,   which  could  adversely   affect  the  present  or
        prospective ability of the Company to perform its obligations under this
        Agreement, the Warrant Agreement or the


                                       26

<PAGE>

        Representative's  Warrant  Agreement  or which in any manner  draws into
        question the validity or enforceability  of this Agreement,  the Warrant
        Agreement or the Representative's Warrant Agreement;

              viii.  the Company has full legal  right,  power and  authority to
        enter  into  each of  this  Agreement,  the  Warrant  Agreement  and the
        Representative's  Warrant Agreement,  and to consummate the transactions
        provided for therein; and each of this Agreement,  the Warrant Agreement
        and the  Representative's  Warrant  Agreement has been duly  authorized,
        executed  and  delivered  by the Company.  Each of this  Agreement,  the
        Warrant Agreement and the Representative's  Warrant Agreement,  assuming
        due  authorization,  execution  and delivery by each other party thereto
        constitutes  a  legal,  valid  and  binding  agreement  of  the  Company
        enforceable  against the Company in accordance with its terms (except as
        such enforceability may be limited by applicable bankruptcy, insolvency,
        reorganization, moratorium or other laws of general application relating
        to or affecting  enforcement of creditors' rights and the application of
        equitable  principles in any action,  legal or equitable,  and except as
        rights to indemnity or contribution  may be limited by applicable  law),
        and none of the Company's  execution or delivery of this Agreement,  the
        Warrant  Agreement  and  the  Representative's  Warrant  Agreement,  its
        performance   hereunder  or   thereunder,   its   consummation   of  the
        transactions  contemplated  herein or  therein,  or the  conduct  of its
        business as described in the Registration Statement, the Prospectus, and
        any amendments or supplements  thereto,  conflicts with or will conflict
        with or results or will result in any breach or  violation of any of the
        terms or  provisions  of, or  constitutes  or will  constitute a default
        under,  or result in the  creation or  imposition  of any lien,  charge,
        claim,   encumbrance,   pledge,  security  interest,   defect  or  other
        restriction  or equity of any kind  whatsoever  upon,  any  property  or
        assets   (tangible  or   intangible)   of  either  the  Company  or  the
        Subsidiaries   pursuant  to  the  terms  of,  (A)  the   certificate  of
        incorporation or by-laws of either the Company or the Subsidiaries,  (B)
        any  license,  contract,  collective  bargaining  agreement,  indenture,
        mortgage,  deed of trust,  lease,  voting trust agreement,  stockholders
        agreement,  note,  loan or credit  agreement  or any other  agreement or
        instrument to which either the Company or the  Subsidiaries  are a party
        or by which  either  of them is or may be bound or to which any of their
        respective  properties or assets  (tangible or  intangible) is or may be
        subject,  or any  indebtedness,  or (C) any statute,  judgment,  decree,
        order,  rule or  regulation  applicable  to either  the  Company  or the
        Subsidiaries of any arbitrator, court, regulatory body or administrative
        agency  or  other  governmental  agency  or  body  (including,   without
        limitation,  those having  jurisdiction  over  environmental  or similar
        matters),  domestic  or  foreign,  having  jurisdiction  over either the
        Company or the  Subsidiaries  or any of their  respective  activities or
        properties.

              ix. no consent,  approval,  authorization  or order, and no filing
        with, any court, regulatory body, government agency or other body (other
        than such as may be required under Blue Sky laws, as to which no opinion
        need be  rendered)  is required in  connection  with the issuance of the
        Firm Securities and the Option Securities pursuant to the Prospectus and
        the  Registration  Statement,   the  issuance  of  the  Representative's
        Warrants,  the performance of this Agreement,  the Warrant Agreement and
        the   Representative's   Warrant   Agreement,   and   the   transactions
        contemplated hereby and thereby;


                                       27

<PAGE>


              x. the  properties  and  business  of each of the  Company and the
        Subsidiaries conform in all material respects to the description thereof
        contained in the Registration Statement and the Prospectus;  and each of
        the Company and the  Subsidiaries  has good and marketable  title to, or
        valid  and  enforceable  leasehold  estates  in,  all  items of real and
        personal  property stated in the Prospectus to be owned or leased by it,
        in each case free and clear of all liens, charges, claims, encumbrances,
        pledges,  security interests,  defects or other restrictions or equities
        of any kind  whatsoever,  other than those referred to in the Prospectus
        and liens for taxes not yet due and payable;

              xi. neither the Company nor the  Subsidiaries are in breach of, or
        in  default  under,  any term or  provision  of any  license,  contract,
        collective bargaining agreement,  indenture,  mortgage, installment sale
        agreement,  deed of trust, lease, voting trust agreement,  stockholders'
        agreement,  partnership agreement, note, loan or credit agreement or any
        other  agreement or instrument  evidencing  an  obligation  for borrowed
        money,  or any other agreement or instrument to which either the Company
        or the  Subsidiaries  are a party or by which  either the Company or the
        Subsidiaries  may be bound  or to which  the  respective  properties  or
        assets   (tangible  or   intangible)   of  either  the  Company  or  the
        Subsidiaries  are subject or  affected;  and neither the Company nor the
        Subsidiaries  are in  violation of any term or provision of its Articles
        of Incorporation  or By-Laws or in violation of any franchise,  license,
        permit, judgment,  decree, order, statute, rule or regulation,  domestic
        or foreign;

              xii.  the  statements  in  the  Prospectus  under  "THE  COMPANY,"
        "BUSINESS,"    "MANAGEMENT,"    "PRINCIPAL    STOCKHOLDERS,"    "CERTAIN
        TRANSACTIONS,"  "DESCRIPTION  OF SECURITIES,"  and "SHARES  ELIGIBLE FOR
        FUTURE  SALE" have been  reviewed by such  counsel,  and insofar as they
        refer to statements of law, descriptions of statutes, licenses, rules or
        regulations or legal conclusions, are correct in all material respects;

              xiii. the Securities have been accepted for quotation on Nasdaq;

              xiv. the persons listed under the caption "PRINCIPAL STOCKHOLDERS"
        in the Prospectus are the respective "beneficial owners" (as such phrase
        is defined in regulation 13d-3 under the Exchange Act) of the securities
        set forth  opposite  their  respective  names  thereunder  as and to the
        extent set forth therein;

              xv.  none  of the  Company,  the  Subsidiaries  nor  any of  their
        respective  officers,  stockholders,  employees or agents, nor any other
        person acting on behalf of either the Company or the Subsidiaries  have,
        directly  or  indirectly,  given or  agreed to give any  money,  gift or
        similar benefit (other than legal price  concessions to customers in the
        ordinary  course of business)  to any  customer,  supplier,  employee or
        agent  of a  customer  or  supplier,  or  official  or  employee  of any
        governmental  agency or instrumentality  of any government  (domestic or
        foreign) or any  political  party or candidate  for office  (domestic or
        foreign)  or  other  person  who is or may be in a  position  to help or
        hinder the business of either the Company or the Subsidiaries (or assist
        it in  connection  with any actual or  proposed  transaction)  which (A)
        might subject either the Company or the Subsidiaries to


                                       28

<PAGE>

        any damage or penalty in any civil, criminal or governmental  litigation
        or proceeding,  (B) if not given in the past,  might have had an adverse
        effect on the  assets,  business  or  operations  of the Company and the
        Subsidiaries  taken as a whole,  as  reflected  in any of the  financial
        statements  contained  in  the  Registration  Statement,  or  (C) if not
        continued in the future,  might adversely  affect the assets,  business,
        operations or prospects of the Company and the  Subsidiaries  taken as a
        whole;

              xvi. no person,  corporation,  trust, partnership,  association or
        other entity has the right to include and/or  register any securities of
        the Company in the Registration  Statement,  require the Company to file
        any registration statement or, if filed, to include any security in such
        registration statement;

              xvii. except as described in the Prospectus,  there are no claims,
        payments, issuances,  arrangements or understandings for services in the
        nature of a finder's or origination  fee with respect to the sale of the
        Securities hereunder or financial  consulting  arrangements or any other
        arrangements, agreements, understandings, payments or issuances that may
        affect the Underwriters' compensation, as determined by the NASD;

              xviii.  assuming due  execution by the parties  thereto other than
        the  Company,  the  Lock-up  Agreements  are  legal,  valid and  binding
        obligations of the parties  thereto,  enforceable  against the party and
        any subsequent  holder of the securities  subject  thereto in accordance
        with  its  terms  (except  as  such  enforceability  may be  limited  by
        applicable bankruptcy, insolvency,  reorganization,  moratorium or other
        laws of general  application  relating to or  affecting  enforcement  of
        creditors'  rights and the  application  of equitable  principles in any
        action,  legal or  equitable,  and  except  as rights  to  indemnity  or
        contribution may be limited by applicable law);

              xix.  except as described in the  Prospectus,  neither the Company
        nor the Subsidiaries (A) maintains, sponsors or contributes to any ERISA
        Plans, (B) maintains or contributes, now or at any time previously, to a
        defined benefit plan, as defined in Section 3(35) of ERISA,  and (C) has
        ever completely or partially withdrawn from a "multiemployer plan";

              xx. the minute  books of each of the Company and the  Subsidiaries
        have been made  available  to the  Underwriters  and  contain a complete
        summary of all meetings and actions of the directors and stockholders of
        the Company  since  [19__] and reflect all  transactions  referred to in
        such minutes accurately in all material respects;

              xxi.  except  as set  forth  in  the  Prospectus  and to the  best
        knowledge of such counsel, no officer, director or stockholder of either
        the Company or the  Subsidiaries,  or any "affiliate" or "associate" (as
        these  terms are  defined  in Rule 405  promulgated  under the Rules and
        Regulations) of any of the foregoing persons or entities has or has had,
        either  directly or indirectly,  (A) an interest in any person or entity
        which (x) furnishes or sells services or products which are furnished or
        sold or are  proposed to be  furnished  or sold by either the Company or
        the Subsidiaries,  or (y) purchases from or sells or furnishes to either
        the  Company  or  the  Subsidiaries  any  goods  or  services,  or (B) a
        beneficial  interest in any  contract or  agreement  to which either the
        Company or the Subsidiaries are a party


                                       29

<PAGE>



        or by which either of them may be bound or affected. Except as set forth
        in the Prospectus  under "CERTAIN  TRANSACTIONS,"  there are no existing
        agreements,  arrangements,  understandings or transactions,  or proposed
        agreements,  arrangements,  understandings  or transactions,  between or
        among any of the Company or the Subsidiaries, and any officer, director,
        or  5%  or  greater   securityholder  of  any  of  the  Company  or  the
        Subsidiaries,  or any  affiliate  or  associate  of any such  person  or
        entity;

              xxii.  each of the Company and the  Subsidiaries  is in compliance
        with all provisions of Section 1 of Laws of Florida,  Chapter 92-198, An
        Act Relating to Disclosure of Doing Business with Cuba;

              xxiii.  none of the  Company,  the  Subsidiaries  or any of  their
        respective  affiliates  shall be subject to the requirements of or shall
        be deemed an  "Investment  Company,"  pursuant to and as defined  under,
        respectively, the Investment Company Act.

        Such  counsel  shall  state  that  such  counsel  has   participated  in
conferences  with  officers  and other  representatives  of the  Company and the
Subsidiaries,  and representatives of the independent public accountants for the
Company and the  Subsidiaries,  at which conferences such counsel made inquiries
of such officers,  representatives and accountants and discussed the contents of
the Preliminary  Prospectus,  the Registration  Statement,  the Prospectus,  and
related  matters  and,  although  such  counsel is not passing upon and does not
assume any  responsibility  for the  accuracy,  completeness  or fairness of the
statements contained in the Preliminary  Prospectus,  the Registration Statement
and  Prospectus,  on the  basis  of the  foregoing,  no facts  have  come to the
attention  of  such  counsel   which  lead  them  to  believe  that  either  the
Registration  Statement or any amendment thereto,  at the time such Registration
Statement  or  amendment  became  effective  or the  Preliminary  Prospectus  or
Prospectus or any amendment or supplement thereto as of the date of such opinion
contained any untrue statement of a material fact or omitted to state a material
fact required to be stated therein or necessary to make the  statements  therein
not  misleading (it being  understood  that such counsel need express no opinion
with respect to the financial  statements and schedules and other  financial and
statistical  data  included  in the  Preliminary  Prospectus,  the  Registration
Statement or the Prospectus).  Such counsel shall further state that its opinion
may be relied  upon by  Underwriters'  Counsel in  rendering  its opinion to the
Underwriters.

        In  rendering  such  opinion,  such  counsel  may rely (A) as to matters
involving the  application  of laws other than the laws of the United States and
jurisdictions  in which they are  admitted,  to the extent  such  counsel  deems
proper and to the extent  specified in such opinion,  if at all, upon an opinion
or opinions (in form and substance  satisfactory  to  Underwriters'  Counsel) of
other counsel acceptable to Underwriters' Counsel,  familiar with the applicable
laws; (B) as to matters of fact, to the extent they deem proper, on certificates
and written  statements of  responsible  officers of each of the Company and the
Subsidiaries  and  certificates  or other  written  statements  of  officers  of
departments of various  jurisdictions having custody of documents respecting the
corporate   existence  or  good   standing  of  each  of  the  Company  and  the
Subsidiaries,  provided that copies of any such statements or certificates shall
be delivered to Underwriters' Counsel if requested.  The opinion of such counsel
for the  Company and the  Subsidiaries  shall state that the opinion of any such
other counsel is in form satisfactory to such


                                       30

<PAGE>

counsel  and that the  Representative,  Underwriters'  Counsel and they are each
justified  in relying  thereon.  Any  opinion of counsel for the Company and the
Subsidiaries  shall not state that it is to be governed or qualified by, or that
it is  otherwise  subject to, any  treatise,  written  policy or other  document
relating to legal opinions,  including,  without  limitation,  the Legal Opinion
Accord of the ABA Section of Business Law (1991) or any comparable state accord.

              e. At each Option  Closing  Date, if any, the  Underwriters  shall
have received the favorable opinion of the Stoppelman Law Firm, P.C., counsel to
the Company and the Subsidiaries,  dated such Option Closing Date,  addressed to
the Underwriters and in form and substance satisfactory to Underwriters' Counsel
confirming as of such Option Closing Date the statements  made by the Stoppelman
Law Firm, P.C. in its opinion delivered on the Closing Date.

              f. On or prior to each of the Closing Date and each Option Closing
Date, if any,  Underwriters'  Counsel shall have been furnished such  documents,
certificates  and  opinions  as they may  reasonably  require for the purpose of
enabling them to review or pass upon the matters  referred to in subsection  (c)
of this  Section  6, or in order  to  evidence  the  accuracy,  completeness  or
satisfaction  of any of the  representations,  warranties  or  conditions of the
Company, or herein contained.

              g. Prior to each of the Closing Date and each Option Closing Date,
if any, (i) there shall have been no adverse change nor development  involving a
prospective change in the condition, financial or otherwise, earnings, position,
value, properties, results of operations, prospects, stockholders' equity or the
business activities of either the Company or the Subsidiaries, whether or not in
the  ordinary  course  of  business,  from the  latest  dates  as of which  such
condition is set forth in the Registration Statement and Prospectus;  (ii) there
shall have been no transaction,  not in the ordinary course of business, entered
into by either the Company or the Subsidiaries, from the latest date as of which
the financial condition of the Company and the Subsidiaries are set forth in the
Registration  Statement and  Prospectus  which is adverse to the Company and the
Subsidiaries  taken as a whole;  (iii) neither the Company nor the  Subsidiaries
shall be in  default  under any  provision  of any  instrument  relating  to any
outstanding  indebtedness;  (iv) neither the Company nor the Subsidiaries  shall
have issued any securities  (other than the  Securities) or declared or paid any
dividend or made any  distribution  in respect of its capital stock of any class
and there has not been any change in the capital stock or any change in the debt
(long or short term) or  liabilities or obligations of either the Company or the
Subsidiaries (contingent or otherwise);  (v) no material amount of the assets of
either the Company or the  Subsidiaries  shall have been  pledged or  mortgaged,
except  as set  forth in the  Registration  Statement  and  Prospectus;  (vi) no
action,  suit or  proceeding,  at law or in equity,  shall have been  pending or
threatened (or circumstances  giving rise to same) against either the Company or
the Subsidiaries,  or affecting any of their respective properties or businesses
before or by any court or federal,  state or foreign commission,  board or other
administrative  agency  wherein an unfavorable  decision,  ruling or finding may
adversely  affect  the  business,   operations,   earnings,   position,   value,
properties, results of operations, prospects or financial condition or income of
the Company and the Subsidiaries taken as a whole; and (vii) no stop order shall
have been  issued  under the Act and no  proceedings  therefor  shall  have been
initiated, threatened or contemplated by the Commission.


                                       31

<PAGE>


              h. At each of the Closing Date and each Option  Closing  Date,  if
any, the Underwriters shall have received a certificate of the Company signed by
the principal  executive  officer and by the chief financial or chief accounting
officer of the Company,  dated the Closing Date or Option  Closing  Date, as the
case may be, to the effect that each of such persons has carefully  examined the
Registration Statement, the Prospectus and this Agreement, and that:

              i. The  representations  and  warranties  of the  Company  in this
        Agreement are true and correct, as if made on and as of the Closing Date
        or the Option  Closing  Date,  as the case may be, and the  Company  has
        complied with all  agreements and covenants and satisfied all conditions
        contained in this  Agreement on its part to be performed or satisfied at
        or prior to such Closing Date or Option  Closing  Date,  as the case may
        be;

              ii. No stop order suspending the effectiveness of the Registration
        Statement or any part thereof has been issued,  and no  proceedings  for
        that purpose have been instituted or are pending or, to the best of each
        of such  person's  knowledge,  after due inquiry,  are  contemplated  or
        threatened under the Act;

              iii. The  Registration  Statement and the Prospectus  and, if any,
        each amendment and each supplement  thereto,  contain all statements and
        information   required  to  be  included   therein,   and  none  of  the
        Registration  Statement,  the Prospectus nor any amendment or supplement
        thereto  includes any untrue  statement  of a material  fact or omits to
        state any material  fact  required to be stated  therein or necessary to
        make the statements  therein not misleading and neither the  Preliminary
        Prospectus or any supplement  thereto included any untrue statement of a
        material  fact or  omitted to state any  material  fact  required  to be
        stated therein or necessary to make the statements  therein, in light of
        the circumstances under which they were made, not misleading; and

              iv.  Subsequent to the respective dates as of which information is
        given in the Registration Statement and the Prospectus,  (a) neither the
        Company  nor the  Subsidiaries  have  incurred up to and  including  the
        Closing Date or the Option  Closing Date, as the case may be, other than
        in the ordinary  course of its  business,  any material  liabilities  or
        obligations,  direct or  contingent;  (b)  neither  the  Company nor the
        Subsidiaries have paid or declared any dividends or other  distributions
        on its capital stock; (c) neither the Company nor the Subsidiaries  have
        entered into any  transactions  not in the ordinary  course of business;
        (d) there has not been any change in the capital stock or long-term debt
        or any increase in the short-term borrowings (other than any increase in
        the short-term  borrowings in the ordinary course of business) of either
        the  Company  or the  Subsidiaries;  (e)  neither  the  Company  nor the
        Subsidiaries  have  sustained  any  loss  or  damage  to  any  of  their
        respective properties or assets, whether or not insured; (f) there is no
        litigation which is pending or threatened (or circumstances  giving rise
        to  same)  against  any  of  the  Company  or  the  Subsidiaries  or any
        affiliated  party of any of the  foregoing  which is  required to be set
        forth in an amended or  supplemented  Prospectus  which has not been set
        forth;  and (g) there has occurred no event  required to be set forth in
        an amended or supplemented Prospectus which has not been set forth.



                                       32

<PAGE>

References to the  Registration  Statement and the Prospectus in this subsection
(j) are to such  documents  as  amended  and  supplemented  at the  date of such
certificate.

              i. By the  Closing  Date,  the  Underwriters  will  have  received
clearance from the NASD as to the amount of compensation allowable or payable to
the Underwriters, as described in the Registration Statement.

              j. At the time this Agreement is executed,  the Underwriters shall
have received a letter,  dated such date,  addressed to the Underwriters in form
and substance satisfactory  (including the non-material nature of the changes or
decreases,  if any,  referred to in clause  (iii)  below) in all respects to the
Underwriters and Underwriters' Counsel, from Ernst & Young LLP:

              i.  confirming  that  they  are   independent   certified   public
        accountants with respect to the Company and the Subsidiaries  within the
        meaning of the Act and the applicable Rules and Regulations;

              ii.  stating  that  it is  their  opinion  that  the  consolidated
        financial  statements  and  supporting  schedules of the Company and the
        Subsidiaries included in the Registration Statement comply as to form in
        all material respects with the applicable accounting requirements of the
        Act and the Rules and Regulations thereunder and that the Representative
        may rely  upon the  opinion  of Ernst & Young  LLP with  respect  to the
        consolidated  financial  statements and supporting schedules included in
        the Registration Statement;

              iii. stating that, on the basis of a limited review which included
        a reading of the latest available unaudited interim financial statements
        of each of the  Company  and the  Subsidiaries,  a reading of the latest
        available  minutes of the  stockholders  and board of directors  and the
        various committees of the boards of directors of each of the Company and
        the  Subsidiaries,  consultations  with officers and other  employees of
        each of the Company and the  Subsidiaries  responsible for financial and
        accounting matters and other specified procedures and inquiries, nothing
        has come to their  attention  which would lead them to believe  that (A)
        the unaudited consolidated financial statements and supporting schedules
        of the  Company  and  the  Subsidiaries  included  in  the  Registration
        Statement  do not comply as to form in all  material  respects  with the
        applicable  accounting  requirements  of  the  Act  and  the  Rules  and
        Regulations  or are not fairly  presented in conformity  with  generally
        accepted   accounting   principles  applied  on  a  basis  substantially
        consistent with that of the audited consolidated financial statements of
        the Company and the Subsidiaries included in the Registration Statement,
        or (B) at a  specified  date not more  than  five (5) days  prior to the
        effective date of the Registration Statement,  there has been any change
        in the  capital  stock or  long-term  debt of either the  Company or the
        Subsidiaries, or any decrease in the stockholders' equity or net current
        assets or net  assets of  either  the  Company  or the  Subsidiaries  as
        compared with amounts shown in the June 30, 1996 balance sheet  included
        in  the  Registration   Statement,   other  than  as  set  forth  in  or
        contemplated by the Registration Statement,  or, if there was any change
        or decrease,  setting  forth the amount of such change or decrease,  and
        (C) during the period from July


                                       33

<PAGE>

        1, 1996 to a  specified  date not more  than five (5) days  prior to the
        effective date of the Registration Statement,  there was any decrease in
        net revenues,  net earnings or increase in net earnings per common share
        of either the Company or the Subsidiaries, in each case as compared with
        the corresponding period beginning July 1, 1995, other than as set forth
        in or contemplated by the Registration  Statement,  or, if there was any
        such decrease, setting forth the amount of such decrease;

              iv. setting forth, at a date not later than five (5) days prior to
        the date of the Registration Statement, the amount of liabilities of the
        Company and the Subsidiaries taken as a whole (including a break-down of
        commercial paper and notes payable to banks);

              v.  stating  that  they have  compared  specific  dollar  amounts,
        numbers of shares, percentages of revenues and earnings,  statements and
        other   financial   information   pertaining  to  the  Company  and  the
        Subsidiaries set forth in the Prospectus in each case to the extent that
        such amounts,  numbers,  percentages,  statements and information may be
        derived from the general accounting  records,  including work sheets, of
        the Company and the Subsidiaries  and excluding any questions  requiring
        an interpretation  by legal counsel,  with the results obtained from the
        application  of  specified  readings,  inquiries  and other  appropriate
        procedures  (which  procedures  do  not  constitute  an  examination  in
        accordance with generally accepted auditing  standards) set forth in the
        letter and found them to be in agreement;

              vi.   statements  as  to  such  other  matters   incident  to  the
        transaction contemplated hereby as the Representative may request.

              k. At the Closing Date and each Option  Closing  Date, if any, the
Underwriters  shall have received  from Ernst & Young LLP a letter,  dated as of
the Closing Date or the Option  Closing  Date, as the case may be, to the effect
that they  reaffirm that  statements  made in the letter  furnished  pursuant to
subsection (l) of this Section, except that the specified date referred to shall
be a date not more than five (5) days  prior to the  Closing  Date or the Option
Closing  Date,  as the case may be,  and,  if the Company has elected to rely on
Rule 430A of the Rules and  Regulations,  to the  further  effect that they have
carried out  procedures  as  specified in clause (v) of  subsection  (l) of this
Section with respect to certain amounts,  percentages and financial  information
as specified by the  Representative  and deemed to be a part of the Registration
Statement pursuant to Rule 430A(b) and have found such amounts,  percentages and
financial  information  to be in  agreement  with the records  specified in such
clause (v).

              l. On each of the Closing Date and each Option  Closing  Date,  if
any, there shall have been duly tendered to the  Representative  for the several
Underwriters' accounts the appropriate number of Securities.

              m.  No  order  suspending  the  sale  of  the  Securities  in  any
jurisdiction  designated by the  Representative  pursuant to  subsection  (e) of
Section 4 hereof shall have been issued on either the Closing Date or the Option
Closing  Date,  if any,  and no  proceedings  for that  purpose  shall have been
instituted or shall be contemplated.



                                       34

<PAGE>

              n. On or before the Closing Date,  the Company shall have executed
and delivered to the Representative,  (i) the Representative's Warrant Agreement
substantially in the form filed as Exhibit 4.2 to the Registration Statement, in
final  form  and  substance  satisfactory  to the  Representative,  and (ii) the
Representative's  Warrants in such  denominations and to such designees as shall
have been provided to the Company.

              o. On or before the Closing Date,  the Firm  Securities and Option
Securities  shall have been duly  approved for  quotation on Nasdaq,  subject to
official notice of issuance.

              p. On or before the Closing Date,  there shall have been delivered
to the  Representative  all of the  Lock-up  Agreements,  in form and  substance
satisfactory to Underwriters' Counsel.

              q. On or before the Closing Date,  the Company shall have executed
and delivered to the Representative and the Transfer Agent the Warrant Agreement
substantially in the form filed as Exhibit [____] to the Registration Statement,
in final form and substance satisfactory to the Representative.

        If  any  condition  to the  Underwriters'  obligations  hereunder  to be
fulfilled  prior to or at the Closing Date or the relevant  Option Closing Date,
as the case may be, is not so fulfilled,  the  Representative may terminate this
Agreement or, if the  Representative so elects, it may waive any such conditions
which have not been fulfilled or extend the time for their fulfillment.

        7.    Indemnification.

              a.  The  Company   agrees  to  indemnify  and  hold  harmless  the
Underwriter  (for  purposes of this Section 7,  "Underwriter"  shall include the
officers,   directors,   partners,   employees,   agents  and   counsel  of  the
Underwriter),   and  each  person,   if  any,   who  controls  the   Underwriter
("controlling  person")  within the  meaning of Section 15 of the Act or Section
20(a) of the Exchange Act, from and against any and all losses, claims, damages,
expenses or  liabilities,  joint or several  (and  actions in respect  thereof),
whatsoever  (including  but  not  limited  to any and  all  expenses  whatsoever
reasonably  incurred  in  investigating,  preparing  or  defending  against  any
litigation,  commenced  or  threatened,  or any claim  whatsoever),  as such are
incurred, to which the Underwriter or such controlling person may become subject
under the Act,  the  Exchange  Act or any  other  statute  or at  common  law or
otherwise or under the laws of foreign  countries,  arising out of or based upon
(A) any  untrue  statement  or  alleged  untrue  statement  of a  material  fact
contained (i) in any Preliminary  Prospectus,  the Registration Statement or the
Prospectus  (as  from  time  to  time  amended  and  supplemented);  (ii) in any
post-effective  amendment or  amendments or any new  registration  statement and
prospectus  in which is included  securities  of the Company  issued or issuable
upon exercise of the  Securities;  or (iii) in any application or other document
or  written  communication  (in this  Section  7,  collectively  referred  to as
"applications")  executed  by the  Company  or based  upon  written  information
furnished by the Company in any  jurisdiction in order to qualify the Securities
under the  securities  laws  thereof  or filed  with the  Commission,  any state
securities  commission or agency,  the NASD, Nasdaq or any securities  exchange;
(B) the omission or alleged omission therefrom of a material fact required to be
stated  therein or necessary to make the  statements  therein not misleading (in
the


                                       35

<PAGE>

case of the Prospectus,  in light of the circumstances in which they were made);
or (C) any breach of any representation,  warranty, covenant or agreement of the
Company contained herein or in any certificate by or on behalf of the Company or
any of its officers delivered pursuant hereto, unless, in the case of clause (A)
or (B) above,  such  statement  or  omission  was made in  reliance  upon and in
conformity with written information furnished to the Company with respect to the
Underwriter  by or on  behalf  of  the  Underwriter  expressly  for  use  in any
Preliminary  Prospectus,  the Registration  Statement or the Prospectus,  or any
amendment thereof or supplement thereto, or in any application,  as the case may
be. The  indemnity  agreement  in this  Section 7(a) shall be in addition to any
liability which the Company may have at common law or otherwise.

        The indemnity  agreement in this  subsection (a) shall be in addition to
any liability which the Company may have at common law or otherwise.

              b. Each of the Underwriters agrees severally,  but not jointly, to
indemnify  and hold  harmless the Company,  each of its  directors,  each of its
officers who has signed the Registration  Statement,  and each other person,  if
any, who controls the Company  within the meaning of the Act, to the same extent
as the foregoing  indemnity from the Company to the  Underwriters  but only with
respect to statements or omissions,  if any, made in any Preliminary Prospectus,
the Registration  Statement or Prospectus or any amendment thereof or supplement
thereto or in any  application  made in reliance upon, and in strict  conformity
with,  written  information  furnished  to  the  Company  with  respect  to  any
Underwriter  by  such   Underwriter   expressly  for  use  in  such  Preliminary
Prospectus, the Registration Statement or Prospectus or any amendment thereof or
supplement  thereto  or in any such  application,  provided  that  such  written
information  or  omissions  only  pertain  to  disclosures  in  the  Preliminary
Prospectus,  the Registration  Statement or Prospectus  directly relating to the
transactions effected by the Underwriters in connection with this Offering.  The
Company  acknowledges that the statements with respect to the public offering of
the Firm  Securities  and the  Option  Securities  set forth  under the  heading
"Underwriting"  and  the  stabilization  legend  in  the  Prospectus  have  been
furnished by the Underwriters  expressly for use therein and constitute the only
information  furnished  in  writing  by or on  behalf  of the  Underwriters  for
inclusion in the Prospectus.

              c.  Promptly  after  receipt by an  indemnified  party  under this
Section  7  of  notice  of  the  commencement  of  any  claim,   action,   suit,
investigation,  inquiry, proceeding or litigation, such indemnified party shall,
if a claim in respect  thereof is to be made  against  one or more  indemnifying
parties under this Section 7, notify each party against whom  indemnification is
to be sought in  writing  of the  commencement  thereof  (but the  failure so to
notify an  indemnifying  party shall not relieve it from any liability  which it
may have under this  Section 7 except to the extent that it has been  prejudiced
in any material  respect by such failure or from any liability which it may have
otherwise).  In case any  such  claim,  action,  suit,  investigation,  inquiry,
proceeding  or  litigation  is brought  against any  indemnified  party,  and it
notifies  an  indemnifying  party or parties of the  commencement  thereof,  the
indemnifying  party or parties will be entitled to participate  therein,  and to
the extent it may elect by written  notice  delivered to the  indemnified  party
promptly after receiving the aforesaid  notice from such  indemnified  party, to
assume  the  defense  thereof  with  counsel  reasonably  satisfactory  to  such
indemnified  party.  Notwithstanding  the foregoing,  the  indemnified  party or
parties shall have the right to employ


                                       36

<PAGE>

its or their  own  counsel  in any such case but the fees and  expenses  of such
counsel shall be at the expense of such indemnified  party or parties unless (i)
the  employment  of such counsel  shall have been  authorized  in writing by the
indemnifying  parties in connection  with the defense  thereof at the expense of
the indemnifying  party,  (ii) the indemnifying  parties shall not have employed
counsel reasonably  satisfactory to such indemnified party to have charge of the
defense thereof within a reasonable  time after notice of commencement  thereof,
or (iii) such indemnified party or parties shall have reasonably  concluded that
there  may be  defenses  available  to it or them  which are  different  from or
additional  to those  available  to one or all of the  indemnifying  parties (in
which  case the  indemnifying  parties  shall not have the  right to direct  the
defense thereof on behalf of the indemnified party or parties),  in any of which
events such fees and expenses of one  additional  counsel  shall be borne by the
indemnifying  parties. In no event shall the indemnifying  parties be liable for
fees and  expenses of more than one counsel (in  addition to any local  counsel)
separate from their own counsel for all  indemnified  parties in connection with
any one claim, action, suit, investigation, inquiry, proceeding or litigation or
separate  but  similar  or  related  claims,  actions,  suits,   investigations,
inquiries, proceedings or litigation in the same jurisdiction arising out of the
same general  allegations  or  circumstances.  Anything in this Section 7 to the
contrary  notwithstanding,  an  indemnifying  party  shall not be liable for any
settlement of any claim, action,  suit,  investigation,  inquiry,  proceeding or
litigation effected without its written consent;  provided,  however,  that such
consent was not unreasonably  withheld.  An indemnifying party will not, without
the prior written  consent of the  indemnified  parties,  settle,  compromise or
consent to the entry of any judgment  with respect to any pending or  threatened
claim, action, suit, investigation, inquiry, proceeding or litigation in respect
of which indemnification or contribution may be sought hereunder (whether or not
the indemnified  parties are actual or potential parties to such claim,  action,
suit, investigation, inquiry, proceeding or litigation), unless such settlement,
compromise or consent (i) includes an unconditional  release of each indemnified
party from all liability arising out of such claim, action, suit, investigation,
inquiry, proceeding or litigation and (ii) does not include a statement as to or
an  admission of fault,  culpability  or a failure to act by or on behalf of any
indemnified party.

              d. In order to provide for just and equitable  contribution in any
case in which (i) an indemnified party makes claim for indemnification  pursuant
to this  Section  7, but it is  judicially  determined  (by the entry of a final
judgment or decree by a court of competent  jurisdiction  and the  expiration of
time  to  appeal  or  the  denial  of  the  last  right  of  appeal)  that  such
indemnification  may not be enforced in such case  notwithstanding the fact that
the express  provisions  of this Section 7 provide for  indemnification  in such
case,  or (ii)  contribution  under the Act may be  required  on the part of any
indemnified  party, then each indemnifying  party shall contribute to the amount
paid as a result of such losses,  claims,  damages,  expenses or liabilities (or
actions in respect  thereof) (A) in such proportion as is appropriate to reflect
the relative benefits received by each of the contributing  parties,  on the one
hand, and the party to be  indemnified  on the other hand,  from the offering of
the Firm Securities and the Option Securities or (B) if the allocation  provided
by clause (A) above is not permitted by applicable law, in such proportion as is
appropriate to reflect not only the relative  benefits referred to in clause (i)
above but also the relative fault of each of the  contributing  parties,  on the
one hand, and the party to be indemnified, on the other hand, in connection with
the  statements  or omissions  that  resulted in such losses,  claims,  damages,
expenses or liabilities, as well as any other relevant equitable considerations.
In any case where the Company is the contributing party and the Underwriters


                                       37

<PAGE>

are the indemnified  party, the relative benefits received by the Company on the
one hand, and the Underwriters,  on the other, shall be deemed to be in the same
proportion  as the total net proceeds  from the offering of the Firm  Securities
and  the  Option  Securities  (before  deducting  expenses)  bear  to the  total
underwriting discounts received by the Underwriters  hereunder,  in each case as
set forth in the table on the Cover Page of the Prospectus. Relative fault shall
be determined by reference to, among other things, whether the untrue or alleged
untrue statement of a material fact or the omission or alleged omission to state
a material  fact  relates to  information  supplied  by the  Company,  or by the
Underwriters, and the parties' relative intent, knowledge, access to information
and  opportunity  to correct or prevent such untrue  statement or omission.  The
amount  paid or  payable  by an  indemnified  party as a result  of the  losses,
claims,  damages,  expenses  or  liabilities  (or  actions in  respect  thereof)
referred to above in this subsection (d) shall be deemed to include any legal or
other expenses  reasonably incurred by such indemnified party in connection with
investigating  or  defending  any such  action  or  claim.  Notwithstanding  the
provisions of this  subsection  (d), the  Underwriters  shall not be required to
contribute any amount in excess of the underwriting  discount  applicable to the
Firm  Securities  and  the  Option  Securities  purchased  by  the  Underwriters
hereunder. No person guilty of fraudulent  misrepresentation (within the meaning
of Section 11(f) of the Act) shall be entitled to  contribution  from any person
who was not guilty of such  fraudulent  misrepresentation.  For purposes of this
Section 7, each person,  if any, who controls the Company  within the meaning of
the Act, each officer of the Company who has signed the Registration  Statement,
and each director of the Company shall have the same rights to  contribution  as
the Company,  subject in each case to this subsection (d). Any party entitled to
contribution  will,  promptly  after  receipt of notice of  commencement  of any
action,  suit or  proceeding  against such party in respect to which a claim for
contribution  may be made against another party or parties under this subsection
(d), notify such party or parties from whom contribution may be sought,  but the
omission  so to notify  such party or  parties  shall not  relieve  the party or
parties from whom  contribution may be sought from any obligation it or they may
have  hereunder or otherwise  than under this  subsection  (d), or to the extent
that such party or parties were not  adversely  affected by such  omission.  The
contribution  agreement set forth above shall be in addition to any  liabilities
which any indemnifying party may have at common law or otherwise.

        8.   Representations   and   Agreements   to   Survive   Delivery.   All
representations,  warranties  and  agreements  contained  in this  Agreement  or
contained in certificates of officers of the Company submitted  pursuant hereto,
shall be deemed to be representations,  warranties and agreements at the Closing
Date and the Option Closing Date, as the case may be, and such  representations,
warranties and agreements of the Company and the indemnity  agreements contained
in  Section  7 hereof,  shall  remain  operative  and in full  force and  effect
regardless of any  investigation  made by or on behalf of any  Underwriter,  the
Company,  any controlling  person of any  Underwriter or the Company,  and shall
survive  termination  of this  Agreement  or the  issuance  and  delivery of the
Securities to the Underwriters and the Representative, as the case may be.

        9. Effective Date. This Agreement shall become  effective at 10:00 a.m.,
New York City time, on the next full business day following the date hereof,  or
at such earlier time after the Registration  Statement  becomes effective as the
Representative,  in its discretion, shall release the Securities for sale to the
public; provided, however, that the provisions of Sections 5, 7 and


                                       38

<PAGE>

10 of this  Agreement  shall at all times be  effective.  For  purposes  of this
Section 9, the Securities to be purchased hereunder shall be deemed to have been
so released upon the earlier of dispatch by the  Representative  of telegrams to
securities  dealers releasing such securities for offering or the release by the
Representative  for  publication of the first newspaper  advertisement  which is
subsequently published relating to the Securities.

        10.   Termination.

              a. Subject to Section 10(b) hereof, the Underwriter shall have the
right to terminate this Agreement: (i) if any domestic or international event or
act or occurrence has materially  adversely  disrupted,  or in the Underwriter's
opinion will in the immediate future materially adversely disrupt, the financial
markets;  or (ii) if any material adverse change in the financial  markets shall
have  occurred;  or (iii) if  trading  generally  shall have been  suspended  or
materially  limited  on or by,  as the  case may be,  any of the New York  Stock
Exchange,  the American Stock Exchange, the NASD, the Boston Stock Exchange, the
Commission or any governmental  authority having jurisdiction over such matters;
or (iv) if  trading  of any of the  securities  of the  Company  shall have been
suspended,  or if any of the securities of the Company shall have been delisted,
on any exchange or in any  over-the-counter  market; or (v) if the United States
shall have become involved in a war or major hostilities, or if there shall have
been an  escalation  in an  existing  war or major  hostilities,  or a  national
emergency  shall have been declared in the United  States;  or (vi) if a banking
moratorium shall have been declared by any state or federal authority;  or (vii)
if a moratorium in foreign exchange trading shall have been declared;  or (viii)
if the Company  shall have  sustained a material  or  substantial  loss by fire,
flood,  accident,  hurricane,  earthquake,  theft, sabotage or other calamity or
malicious act which, whether or not such loss shall have been insured,  will, in
the Underwriter's  opinion,  make it inadvisable to proceed with the delivery of
the Securities;  or (ix) if there shall have been such a material adverse change
in the conditions or prospects of the Company,  or if there shall have been such
a  material  adverse  change  in  the  general  market,  political  or  economic
conditions,  in the United States or elsewhere, as in the Underwriter's judgment
would make it inadvisable to proceed with the offering,  sale and/or delivery of
the  Securities;  or (x) if Glenn A. Norem shall no longer  serve the Company in
his present capacities.

              b.  If this  Agreement  is  terminated  by the  Representative  in
accordance  with the  provisions  of Section  10(a) the Company  shall  promptly
reimburse and indemnify the Representative  for all of its actual  out-of-pocket
expenses,  including the fees and  disbursements of counsel for the Underwriters
(less  amounts  previously  paid  pursuant  to Section  5(c)  above);  provided,
however,  that the Representative will refund to the Company any unaccounted-for
portion of any amounts  already  advanced  by the Company to the  Representative
pursuant  to  Section  5(c)  hereof.   Notwithstanding  any  contrary  provision
contained in this  Agreement,  if this Agreement shall not be carried out within
the  time  specified   herein,   or  any  extension   thereof   granted  by  the
Representative,  by reason of any  failure on the part of the Company to perform
any undertaking or satisfy any condition of this Agreement by it to be performed
or satisfied  (including,  without limitation,  pursuant to Section 6 or Section
12) then, the Company shall promptly  reimburse and indemnify the Representative
for  all  of  its  actual  out-of-pocket   expenses,   including  the  fees  and
disbursements  of counsel for the  Underwriters  (less amounts  previously  paid
pursuant to Section 5(c) above); provided, however, that the Representative will
refund to


                                       39

<PAGE>

the Company any  unaccounted-for  portion of any amounts already advanced by the
Company to the Representative  pursuant to Section 5(c) hereof. In addition, the
Company  shall remain  liable for all Blue Sky counsel  fees and  disbursements,
expenses and filing fees.  Notwithstanding  any contrary provision  contained in
this  Agreement,  any election  hereunder or any  termination  of this Agreement
(including,  without limitation,  pursuant to Sections 6, 10, 11 and 12 hereof),
and whether or not this  Agreement is otherwise  carried out, the  provisions of
Section 5 and  Section 7 shall not be in any way  affected  by such  election or
termination  or  failure  to carry out the terms of this  Agreement  or any part
hereof.

        11. Substitution of the Underwriters. If one or more of the Underwriters
shall fail (otherwise than for a reason sufficient to justify the termination of
this  Agreement  under the  provisions  of Section  6,  Section 10 or Section 12
hereof) to purchase the Securities which it or they are obligated to purchase on
such date under this Agreement (the "Defaulted Securities"),  the Representative
shall have the right, within 24 hours thereafter, to make arrangement for one or
more of the non-defaulting Underwriters,  or any other underwriters, to purchase
all, but not less than all, of the  Defaulted  Securities in such amounts as may
be  agreed  upon  and  upon  the  terms  herein  set  forth;  if,  however,  the
Representative  shall not have completed such  arrangements  within such 24-hour
period, then:

              (a) if the number of Defaulted  Securities  does not exceed 10% of
        the total number of Firm  Securities  to be purchased on such date,  the
        non-defaulting  Underwriters  shall be  obligated  to purchase  the full
        amount thereof in the  proportions  that their  respective  underwriting
        obligations  hereunder  bear  to  the  underwriting  obligations  of all
        non-defaulting Underwriters, or

              (b) if the number of Defaulted Securities exceeds 10% of the total
        number  of Firm  Securities,  this  Agreement  shall  terminate  without
        liability on the part of any  non-defaulting  Underwriters  (or, if such
        default  shall  occur  with  respect  to  any  Option  Securities  to be
        purchased  on an  Option  Closing  Date,  the  Underwriters  may  at the
        Representative's  option,  by  notice  from  the  Representative  to the
        Company,  terminate  the  Underwriters'  obligation  to purchase  Option
        Securities from the Company on such date).

        No action taken pursuant to this Section 11 shall relieve any defaulting
Underwriter from liability in respect of any default by such  Underwriter  under
this Agreement.

        In the event of any such default  which does not result in a termination
of this  Agreement,  the  Representative  shall have the right to  postpone  the
Closing  Date for a period not  exceeding  seven (7) days in order to effect any
required  changes in the  Registration  Statement or  Prospectus or in any other
documents or arrangements.

        12.  Default by the  Company.  If the Company  shall fail at the Closing
Date or at any Option  Closing  Date,  as  applicable,  to sell and  deliver the
number of Securities  which it is obligated to sell hereunder on such date, then
this Agreement  shall terminate (or, if such default shall occur with respect to
any  Option   Securities  to  be  purchased  on  an  Option  Closing  Date,  the
Underwriters   may  at  the   Representative's   option,   by  notice  from  the
Representative  to  the  Company,  terminate  the  Underwriters'  obligation  to
purchase Option Securities from the


                                       40

<PAGE>

Company on such date)  without any  liability on the part of any  non-defaulting
party  other than  pursuant to Section 5,  Section 7 and  Section 10 hereof.  No
action  taken  pursuant  to this  Section  12 shall  relieve  the  Company  from
liability, if any, in respect of such default.

        13. Notices. All notices and communications hereunder,  except as herein
otherwise specifically provided, shall be in writing and shall be deemed to have
been  duly   given  if  mailed  or   transmitted   by  any   standard   form  of
telecommunication.  Notices  to  the  Underwriters  shall  be  directed  to  the
Representative at National  Securities  Corporation,  1001 Fourth Avenue,  Suite
2200, Seattle, Washington 98154, Attention: Steven A. Rothstein,  Chairman, with
a copy to Orrick,  Herrington & Sutcliffe  LLP, 666 Fifth Avenue,  New York, New
York 10103, Attention:  Lawrence B. Fisher, Esq. Notices to the Company shall be
directed to the  Company at 2665 Villa Creek  Drive,  Suite 200,  Dallas,  Texas
75234,  Attention:  Glenn A. Norem, Chief Executive Officer,  with a copy to the
Stoppelman Law Firm,  P.C., 1749 Old Meadow Road, Suite 610,  McClean,  Virginia
22102, Attention: John S. Stoppelman, Esq.

        14.  Parties.  This  Agreement  shall inure solely to the benefit of and
shall be  binding  upon,  the  Underwriters,  the  Company  and the  controlling
persons,  directors  and  officers  referred  to in Section 7 hereof,  and their
respective  successors,  legal  representatives and assigns, and no other person
shall have or be construed to have any legal or equitable right, remedy or claim
under or in respect of or by virtue of this Agreement or any  provisions  herein
contained. No purchaser of Securities from any Underwriter shall be deemed to be
a successor by reason merely of such purchase.

        15. Construction.  This Agreement shall be governed by and construed and
enforced in  accordance  with the laws of the State of New York  without  giving
effect to the choice of law or conflict of laws principles.

        16.  Counterparts.  This  Agreement  may be  executed  in any  number of
counterparts,  each of which shall be deemed to be an original, and all of which
taken together shall be deemed to be one and the same instrument.

        17. Entire Agreement;  Amendments. This Agreement, the Warrant Agreement
and the  Representative's  Warrant Agreement  constitute the entire agreement of
the  parties  hereto  and  supersede  all  prior  written  or  oral  agreements,
understandings and negotiations with respect to the subject matter hereof.  This
Agreement may not be amended except in a writing,  signed by the  Representative
and the Company.



                                       41

<PAGE>

        If the  foregoing  correctly  sets forth the  understanding  between the
Underwriters and the Company, please so indicate in the space provided below for
that purpose,  whereupon this letter shall constitute a binding  agreement among
us.

                                                  Very truly yours,

                                                  MULTIMEDIA ACCESS CORPORATION



                                                  By:
                                                     ---------------------------
                                                     Glenn A. Norem
                                                     Chief Executive Officer


Confirmed and accepted as of 
the date first above written.


NATIONAL SECURITIES CORPORATION

For itself and as Representative
  of the several Underwriters named
  in Schedule A hereto.


By:
   ---------------------------
    Steven A. Rothstein
    Chairman



<PAGE>


                                   SCHEDULE A
                                   ----------

<TABLE>
<CAPTION>

 
                                                                                       Number of
                                                                                       Redeemable
                                                          Number of Shares           Warrants to be
Name of Underwriters                                      to be Purchased               Purchased
- --------------------                                      ---------------            ---------------

<S>                                                           <C>                        <C> 
National Securities Corporation..............

Network 1 Financial Securitie, Inc...........





Total........................................                 1,800,000                  1,800,000
                                                              =========                  =========


</TABLE>
                                       43

                                                                           DRAFT
                                                                        10/25/96

 [Form of Warrant Agreement - Subject to Additional Internal and Client Review]

   ==========================================================================





                          MULTIMEDIA ACCESS CORPORATION

                                       AND

                   CONTINENTAL STOCK TRANSFER & TRUST COMPANY



                                   ----------








                                WARRANT AGREEMENT





                          Dated as of ___________, 1996





   ==========================================================================


NY1-161301.2
                                                            8789-10-MZ1-10/29/96

<PAGE>



                  AGREEMENT,  dated this ____ day of ____________,  1996, by and
among MULTIMEDIA ACCESS CORPORATION,  a Delaware corporation (the "Company") and
CONTINENTAL  STOCK  TRANSFER & TRUST  COMPANY,  as Warrant  Agent (the  "Warrant
Agent").
                              W I T N E S S E T H:

                  WHEREAS,  in  connection  with (i) the  offering to the public
(the "Public Offering") of up to 1,800,000 shares of Common Stock (as defined in
Section  1)  and  1,800,000  redeemable  common  stock  purchase  warrants  (the
"Warrants"),   each  Warrant  entitling  the  holder  thereof  to  purchase  one
additional  share of Common Stock,  (ii) the  over-allotment  option  granted to
National Securities  Corporation,  as representative of the several underwriters
of the Public  Offering (the  "Representative")  to purchase up to an additional
270,000  shares of Common Stock and/or  270,000  Warrants  (the  "Over-allotment
Option"),  and (iii) the sale to the Representative or its designees of warrants
(the  "Representative's  Warrants")  to purchase up to 180,000  shares of Common
Stock and/or 180,000 Warrants,  the Company will issue up to 2,250,000  Warrants
(subject  to increase as  provided  herein and in the  Representative's  Warrant
Agreement); and

                  WHEREAS,  the Company  desires to provide for the  issuance of
certificates representing the Warrants; and

                  WHEREAS,  the  Company  desires  the  Warrant  Agent to act on
behalf of the Company, and the Warrant Agent is willing to so act, in connection
with the  issuance,  registration,  transfer,  exchange  and  redemption  of the
Warrants,  the issuance of certificates  representing the Warrants, the exercise
of the Warrants and the rights of the holders thereof.

                  NOW,  THEREFORE,  in  consideration  of the  premises  and the
mutual  agreements  hereinafter  set forth and for the purpose of  defining  the
terms and provisions of the Warrants


NY1-161301.1
                                                            8789-10-MZ1-10/29/96

<PAGE>



and the  certificates  representing  the Warrants and the respective  rights and
obligations  thereunder  of the  Company,  the  Representative,  the  holders of
certificates representing the Warrants and the Warrant Agent, the parties hereto
agree as follows:

                  SECTION 1.  Definitions.  As used herein,  the following terms
shall have the following meanings, unless the context shall otherwise require:

                            (a) "Act" shall mean the  Securities Act of 1933, as
amended.
                           
                            (b) "Common Stock" shall mean the  authorized  stock
of the Company of any class, whether now or hereafter authorized,  which has the
right to  participate  in the voting and in the  distribution  of  earnings  and
assets of the Company without limit as to amount or percentage which at the date
hereof  consists  of  20,000,000  shares of Common  Stock,  $.0001 par value per
share.
                            (c)  "Commission"  shall  mean  the  Securities  and
Exchange Commission.
                        
                            (d) "Corporate  Office" shall mean the office of the
Warrant Agent (or its successor) at which at any particular time its business in
New York, New York, shall be  administered,  which office is located on the date
hereof at 2 Broadway,  19th Floor,  New York, New York 10004.

                            (e)  "Exchange   Act"  shall  mean  the   Securities
Exchange Act of 1934, as amended.

                            (f)  "Exercise  Date"  shall  mean,  subject  to the
provisions  of Section  5(b) hereof,  as to any  Warrant,  the date on which the
Warrant Agent shall have received both (i) the Warrant Certificate  representing
such Warrant,  with the exercise  form thereon duly  executed by the  Registered
Holder thereof or his attorney duly  authorized in writing,  and (ii) payment in
cash or by official  bank or certified  check made payable to the Warrant  Agent
for the account


NY1-161301.1                                              8789-10-MZ1-10/29/96 2
z
<PAGE>



of the Company,  of the amount in lawful  money of the United  States of America
equal to the  applicable  Purchase Price (as  hereinafter  defined) in available
funds.
                          
                            (g)  "Initial  Warrant  Exercise  Date"  shall  mean
_____________  __, 1997 [6 months from the  effective  date of the  Registration
Statement].
                         
                            (h)  "Initial  Warrant  Redemption  Date" shall mean
_______________  __, 1998 [18 months from the effective date of the Registration
Statement]. 

                            (i) "NASD" z shall mean the National  Association of
Securities Dealers, Inc.

                            (j) "Nasdaq" shall mean the Nasdaq Stock Market.

                            (k)   "Purchase   Price"  shall  mean,   subject  to
modification  and  adjustment  as  provided in Section 8,  $[____]  [120% of the
initial public  offering  price of the Common Stock] and further  subject to the
Company's  right, in its sole  discretion,  to decrease the Purchase Price for a
period of not less than 30 days on not less than 30 days' prior  written  notice
to the Registered  Holders and the  Representative.  

                            (l) "Redemption Date" shall mean the date (which may
not occur before the Initial Warrant  Redemption  Date) fixed for the redemption
of the Warrants in accordance  with the terms  hereof.  

                            (m) "Redemption Price" shall mean the price at which
the Company may, at its option,  redeem the  Warrants,  in  accordance  with the
terms hereof, which price shall be $0.10 per Warrant, subject to adjustment from
time to time pursuant to the provisions of Section 9 hereof.


NY1-161301.1
                                                            8789-10-MZ1-10/29/96
                                        3

<PAGE>



                            (n)  "Registered  Holder"  shall  mean the person in
whose name any certificate  representing the Warrants shall be registered on the
books maintained by the Warrant Agent pursuant to Section 6.

                            (o)   "Registration   Statement"   shall   mean  the
registration  statement on Form SB-2, as amended and  supplemented  from time to
time, relating to the Public Offering and filed with the Commission.

                            (p) "Transfer  Agent" shall mean  Continental  Stock
Transfer & Trust Company, or its authorized successor.

                            (q)   "Underwriting   Agreement"   shall   mean  the
underwriting   agreement  dated   ______________  __,  1996  [the  date  of  the
Prospectus]  between the Company and the  several  underwriters  listed  therein
relating to the  purchase  for resale to the public of the  1,800,000  shares of
Common Stock and 1,800,000 Warrants.  

                            (r) "Representative's  Warrant Agreement" shall mean
the agreement dated as of _______________  __, 1996 [the date of the Prospectus]
between the Company and the  Representative  relating to and governing the terms
and provisions of the Representative's Warrants.

                            (s) "Warrant  Certificate"  shall mean a certificate
representing  each of the Warrants  substantially  in the form annexed hereto as
Exhibit A. 

                            (t) "Warrant Expiration Date" shall mean, unless the
Warrants are  redeemed as provided in Section 9 hereof prior to such date,  5:30
p.m. (New York time),  on  ______________  __, 2001 [60 months after the date of
the  Prospectus],  or the Redemption Date as defined  herein,  whichever date is
earlier;  provided that if such date shall in the State of New York be a holiday
or a day on which banks are authorized to close, then 5:30 p.m. (New York


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time) on the next  following  day  which,  in the  State of New  York,  is not a
holiday or a day on which  banks are  authorized  to close.  Upon five  business
days' prior written notice to the Registered Holders, the Company shall have the
right to extend the Warrant Expiration Date.

                  SECTION 2.  Warrants and Issuance of Warrant Certificates.
                              ---------------------------------------------

                            (a)  Each  Warrant  shall   initially   entitle  the
Registered  Holder of the  Warrant  Certificate  representing  such  Warrant  to
purchase at the Purchase Price therefor from the Initial  Warrant  Exercise Date
until the Warrant  Expiration  Date one share of Common  Stock upon the exercise
thereof  in  accordance  with the terms  hereof,  subject  to  modification  and
adjustment as provided in Section 8.

                            (b)  Upon  execution  of  this  Agreement,   Warrant
Certificates   representing   the  number  of  Warrants  sold  pursuant  to  the
Underwriting  Agreement  (subject to modification  and adjustment as provided in
Section 8) shall be executed by the Company and delivered to the Warrant  Agent.

                            (c) Upon exercise of the  Representative's  Warrants
as  provided  therein,  Warrant  Certificates  representing  all or a portion of
180,000  Warrants  to purchase up to an  aggregate  of 180,000  shares of Common
Stock  (subject to  modification  and adjustment as provided in Section 8 hereof
and in the  Representative's  Warrant Agreement) shall be countersigned,  issued
and delivered by the Warrant  Agent upon written order of the Company  signed by
its  Chairman  of  the  Board,  Chief  Executive  Officer,  President  or a Vice
President and by its Treasurer or an Assistant  Treasurer or its Secretary or an
Assistant Secretary

                            (d) From time to time, up to the Warrant  Expiration
Date or the Redemption Date,  whichever date is earlier, the Warrant Agent shall
countersign and deliver Warrant Certificates in required denominations of one or
whole number multiples thereof to the


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person entitled  thereto in connection  with any transfer or exchange  permitted
under this Agreement.  Except as provided herein, no Warrant  Certificates shall
be issued except (i) Warrant  Certificates  initially  issued  hereunder,  those
issued pursuant to the exercise of the Over-  allotment  Option and those issued
on or after the Initial  Warrant  Exercise Date, upon the exercise of fewer than
all Warrants held by the exercising Registered Holder, (ii) Warrant Certificates
issued upon any transfer or exchange of  Warrants,  (iii)  Warrant  Certificates
issued  in  replacement  of  lost,   stolen,   destroyed  or  mutilated  Warrant
Certificates pursuant to Section 7, (iv) Warrant Certificates issued pursuant to
the  Representative's  Warrant Agreement,  and (v) at the option of the Company,
Warrant  Certificates in such form as may be approved by its Board of Directors,
to reflect any adjustment or change in the Purchase Price,  the number of shares
of Common Stock  purchasable  upon  exercise of the  Warrants or the  Redemption
Price therefor made pursuant to Section 8 hereof.

                  SECTION 3.  Form and Execution of Warrant Certificates.
                              ------------------------------------------
                            (a) The Warrant  Certificates shall be substantially
in the form  annexed  hereto as  Exhibit A (the  provisions  of which are hereby
incorporated  herein)  and may have  such  letters,  numbers  or other  marks of
identification  or  designation  and such  legends,  summaries  or  endorsements
printed,  lithographed or engraved  thereon as the Company may deem  appropriate
and as are not inconsistent with the provisions of this Agreement,  or as may be
required to comply  with any law or with any rule or  regulation  made  pursuant
thereto  or with any rule or  regulation  of any  stock  exchange  on which  the
Warrants may be listed, or to conform to usage. The Warrant  Certificates  shall
be dated the date of issuance thereof (whether upon initial issuance,  transfer,
exchange or in lieu of mutilated, lost, stolen or destroyed Warrant


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Certificates) and issued in registered form. Warrants shall be numbered serially
with the letter W on the Warrants.

                            (b) Warrant Certificates shall be executed on behalf
of the Company by its Chairman of the Board, Chief Executive Officer,  President
or any Vice  President  and by its  Treasurer or an  Assistant  Treasurer or its
Secretary  or an  Assistant  Secretary,  by manual  signatures  or by  facsimile
signatures printed thereon,  and shall have imprinted thereon a facsimile of the
Company's seal.  Warrant  Certificates  shall be manually  countersigned  by the
Warrant Agent and shall not be valid for any purpose unless so countersigned. In
case any  officer  of the  Company  who shall  have  signed  any of the  Warrant
Certificates  shall cease to be such  officer of the Company  before the date of
issuance of the Warrant  Certificates or before  countersignature by the Warrant
Agent and issue and delivery thereof, such Warrant  Certificates,  nevertheless,
may be  countersigned  by the Warrant Agent,  issued and delivered with the same
force and effect as though the person who signed such Warrant  Certificates  had
not ceased to be such  officer of the  Company.  After  countersignature  by the
Warrant Agent,  Warrant  Certificates shall be delivered by the Warrant Agent to
the Registered Holder promptly and without further action by the Company, except
as otherwise provided by Section 4(a) hereof. 

                 SECTION 4. Exercise. 
                            --------
                            (a) Warrants in denominations of one or whole number
multiples thereof may be exercised by the Registered  Holder thereof  commencing
at any time on or after the Initial  Warrant  Exercise  Date,  but not after the
Warrant  Expiration Date, upon the terms and subject to the conditions set forth
herein and in the applicable Warrant  Certificate.  A Warrant shall be deemed to
have been exercised  immediately  prior to the close of business on the Exercise
Date provided that the Warrant Certificate  representing such Warrant,  with the
exercise


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form thereon duly executed by the Registered Holder thereof or his attorney duly
authorized in writing, together with payment in cash or by check made payable to
the Warrant Agent for the account of the Company of an amount in lawful money of
the United States of America equal to the applicable  purchase price,  have been
received by the Warrant  Agent.  The person  entitled to receive the  securities
deliverable  upon such exercise shall be treated for all purposes as the holder,
upon  exercise  thereof,  as of the close of business on the Exercise  Date.  If
Warrants in  denominations  other than whole number  multiples  thereof shall be
exercised at one time by the same Registered  Holder,  the number of full shares
of Common Stock which shall be issuable upon exercise  thereof shall be computed
on the basis of the  aggregate  number of full shares of Common  Stock  issuable
upon such exercise.  As soon as practicable on or after the Exercise Date and in
any event within five  business  days after such date,  if one or more  Warrants
have been  exercised,  the Warrant Agent on behalf of the Company shall cause to
be issued to the person or persons  entitled to receive the same a Common  Stock
certificate or certificates for the shares of Common Stock deliverable upon such
exercise,  and the Warrant Agent shall deliver the same to the person or persons
entitled  thereto.  Upon the exercise of any one or more  Warrants,  the Warrant
Agent  shall  promptly  notify  the  Company  in writing of such fact and of the
number of securities delivered upon such exercise and, subject to subsection (b)
below, shall cause all payments of an amount in cash or by check made payable to
the order of the Company,  equal to the Purchase Price, to be deposited promptly
in the Company's bank account.

                            (b) The  Company  shall  not be  required  to  issue
fractional shares on the exercise of Warrants. Warrants may only be exercised in
such  multiples  as are required to permit the issuance by the Company of one or
more whole shares.  If two or more  Warrants  shall be presented for exercise in
full at the same time by the same Registered Holder, the


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number of whole shares which shall be issuable upon such exercise  thereof shall
be  computed  on the basis of the  aggregate  number of  shares  purchasable  on
exercise of the Warrants so presented.  If any fraction of a share would, except
for the provisions  provided herein,  be issuable on the exercise of any Warrant
(or specified portion thereof), the Company shall pay an amount in cash equal to
such fraction  multiplied by the then current  market value of a share of Common
Stock, determined as follows:

                  (1) If the Common  Stock is listed,  or  admitted  to unlisted
trading privileges on a national  securities  exchange,  or is traded on Nasdaq,
the current  market  value of a share of Common  Stock shall be the closing sale
price of the Common Stock at the end of the regular  trading session on the last
business  day prior to the date of exercise of the Warrants on whichever of such
exchanges or Nasdaq had the highest  average daily trading volume for the Common
Stock on such day; or

                  (2) If the Common  Stock is not listed or admitted to unlisted
trading privileges on any national  securities  exchange,  or listed,  quoted or
reported for trading on Nasdaq,  but is traded in the  over-the-counter  market,
the current  market value of a share of Common Stock shall be the average of the
last reported bid and asked prices of the Common Stock  reported by the National
Quotation Bureau, Inc. on the last business day prior to the date of exercise of
the Warrants; or
                  (3) If the Common  Stock is not  listed,  admitted to unlisted
trading privileges on any national  securities  exchange,  or listed,  quoted or
reported for trading on Nasdaq, and bid and asked prices of the Common Stock are
not reported by the National Quotation Bureau, Inc., the current market value of
a share of Common Stock shall be an amount, not less than the book value thereof
as of the end of the most  recently  completed  fiscal  quarter  of the  Company
ending


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prior  to the  date of  exercise,  determined  by the  members  of the  Board of
Directors of the Company  exercising  good faith and using  customary  valuation
methods.
                  
                 SECTION 5.  Reservation of Shares; Listing; Payment of Taxes;
                             ------------------------------------------------- 
                             etc.
                             ----
                            (a) The Company  covenants that it will at all times
reserve and keep  available out of its authorized  Common Stock,  solely for the
purpose of issuance upon  exercise of Warrants,  such number of shares of Common
Stock as shall then be issuable upon the exercise of all  outstanding  Warrants.
The Company  covenants  that all shares of Common  Stock which shall be issuable
upon exercise of the Warrants  shall, at the time of delivery  thereof,  be duly
and validly issued and fully paid and nonassessable and free from all preemptive
or similar rights,  taxes,  liens and charges with respect to the issue thereof,
and that upon issuance such shares shall be listed on each securities  exchange,
if any, on which the other shares of outstanding Common Stock of the Company are
then listed. 

                            (b) The Company  covenants that if any securities to
be  reserved  for  the  purpose  of  exercise  of  Warrants   hereunder  require
registration with, or approval of, any governmental  authority under any federal
securities  law before such  securities  may be validly issued or delivered upon
such  exercise,  then the Company will file a registration  statement  under the
federal securities laws or a post-effective  amendment,  use its best efforts to
cause  the same to become  effective  and to keep  such  registration  statement
current while any of the Warrants are outstanding and deliver a prospectus which
complies with Section 10(a)(3) of the Act, to the Registered  Holder  exercising
the  Warrant  (except,  if in  the  opinion  of  counsel  to the  Company,  such
registration is not required under the federal  securities law or if the Company
receives a letter  from the staff of the  Commission  stating  that it would not
take any enforcement  action if such registration is not effected).  The Company
will use its best efforts to obtain appropriate


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approvals or  registrations  under state "blue sky" securities laws with respect
to any such securities.  However, Warrants may not be exercised by, or shares of
Common  Stock  issued  to,  any  Registered  Holder in any  state in which  such
exercise would be unlawful.
                         
                            (c) The Company shall pay all documentary,  stamp or
similar taxes and other governmental charges that may be imposed with respect to
the  issuance of  Warrants,  or the issuance or delivery of any shares of Common
Stock upon exercise of the Warrants; provided, however, that if shares of Common
Stock are to be delivered in a name other than the name of the Registered Holder
of the Warrant  Certificate  representing any Warrant being  exercised,  then no
such delivery  shall be made unless the person  requesting  the same has paid to
the Warrant Agent the amount of transfer taxes or charges incident  thereto,  if
any.  

                            (d)  The   Warrant   Agent  is  hereby   irrevocably
authorized as the Transfer Agent to requisition  from time to time  certificates
representing  shares of Common Stock or other securities  required upon exercise
of the Warrants, and the Company will comply with all such requisitions. 

                 SECTION 6.  Exchange and  Registration  of  Transfer.  
                             ----------------------------------------
                            (a) Warrant  Certificates may be exchanged for other
Warrant  Certificates  representing an equal aggregate number of Warrants of the
same class or may be transferred in whole or in part. Warrant Certificates to be
exchanged  shall be  surrendered  to the Warrant Agent at its Corporate  Office,
and, upon  satisfaction  of the terms and provisions  hereof,  the Company shall
execute and the Warrant Agent shall  countersign,  issue and deliver in exchange
therefor the Warrant  Certificate or  Certificates  which the Registered  Holder
making the exchange shall be entitled to receive.


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                            (b) The Warrant  Agent  shall  keep,  at its office,
books in which, subject to such reasonable  regulations as it may prescribe,  it
shall register Warrant  Certificates and the transfer thereof in accordance with
customary  practice.  Upon due presentment  for  registration of transfer of any
Warrant  Certificate  at such office,  the Company shall execute and the Warrant
Agent shall issue and deliver to the  transferee  or  transferees  a new Warrant
Certificate or Certificates  representing an equal aggregate  number of Warrants
of the same class.  

                            (c)  With   respect  to  all  Warrant   Certificates
presented  for  registration  of  transfer,  or for  exchange or  exercise,  the
subscription  or exercise form, as the case may be, on the reverse thereof shall
be duly endorsed or be  accompanied  by a written  instrument or  instruments of
transfer and  subscription,  in form satisfactory to the Company and the Warrant
Agent,  duly executed by the Registered  Holder thereof or his  attorney-in-fact
duly  authorized in writing.  

                            (d) A service  charge may be imposed by the  Warrant
Agent for any exchange or registration of transfer of Warrant  Certificates.  In
addition,  the Company may require payment by such Holder of a sum sufficient to
cover any tax or other  governmental  charge  that may be imposed in  connection
therewith. 

                            (e)  All  Warrant   Certificates   surrendered   for
exercise or for  exchange in case of  mutilated  Warrant  Certificates  shall be
promptly  canceled by the Warrant Agent and  thereafter  retained by the Warrant
Agent until  termination of this  Agreement.  

                            (f) Prior to due  presentment  for  registration  of
transfer  thereof,  the  Company  and the  Warrant  Agent may deem and treat the
Registered  Holder of any Warrant  Certificate as the absolute owner thereof and
of each Warrant represented thereby  (notwithstanding any notations of ownership
or writing thereon made by anyone other than a


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duly  authorized  officer of the Company or the Warrant  Agent) for all purposes
and shall not be affected by any notice to the contrary.

                  SECTION 7. Loss or Mutilation. Upon receipt by the Company and
the Warrant Agent of evidence  satisfactory  to them of the ownership of and the
loss,  theft,  destruction or mutilation of any Warrant  Certificate and (in the
case of loss,  theft or destruction) of indemnity  satisfactory to them, and (in
case of mutilation) upon surrender and cancellation  thereof,  the Company shall
execute  and the  Warrant  Agent  shall (in the absence of notice to the Company
and/or the Warrant Agent that a new Warrant  Certificate  has been acquired by a
bona fide purchaser)  countersign  and deliver to the Registered  Holder in lieu
thereof a new Warrant  Certificate of like tenor representing an equal aggregate
number of Warrants.  Applicants for a substitute Warrant  Certificate shall also
comply  with such other  reasonable  regulations  and pay such other  reasonable
charges as the Warrant Agent may prescribe.

                  SECTION 8.  Adjustment of Purchase Price and  Number of Shares
of Common Stock Deliverable.

                            (a) Except as hereinafter provided, in the event the
Company shall,  at any time or from time to time after the date hereof and prior
to the Warrant  Expiration  Date, issue or sell any shares of Common Stock for a
consideration  per share  less than the  Purchase  Price or issue any  shares of
Common Stock as a stock dividend to the holders of Common Stock, or subdivide or
combine the  outstanding  shares of Common Stock into a greater or lesser number
of shares (any such issuance,  subdivision or combination  being herein called a
"Change of Shares"),  then, and  thereafter  upon each further Change of Shares,
the Purchase Price for the Warrants (whether or not the same shall be issued and
outstanding)  in effect  immediately  prior to such  Change  of Shares  shall be
changed to a price (including any applicable fraction of a cent


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to the nearest cent)  determined by dividing (i) the sum of (a) the total number
of  shares of  Common  Stock  outstanding  immediately  prior to such  Change of
Shares,  multiplied by the Purchase  Price in effect  immediately  prior to such
Change of Shares and (b) the consideration, if any, received by the Company upon
such sale,  issuance,  subdivision or  combination,  by (ii) the total number of
shares of Common  Stock  outstanding  immediately  after such  Change of Shares;
provided,  however,  that in no event  shall  the  Purchase  Price  be  adjusted
pursuant to this  computation  to an amount in excess of the  Purchase  Price in
effect  immediately  prior  to  such  computation,  except  in  the  case  of  a
combination of outstanding shares of Common Stock.
                 
                 For  the purposes of any  adjustment  to be made in  accordance
with this Section 8(a), the following provisions shall be applicable:

                            (A) In case of the  issuance  or sale of  shares  of
Common Stock (or of other securities deemed hereunder to involve the issuance or
sale of shares of Common Stock) for a  consideration  part or all of which shall
be cash, the amount of the cash portion of the consideration  therefor deemed to
have been received by the Company shall be (i) the subscription price, if shares
of Common Stock are offered by the Company for subscription,  or (ii) the public
offering price (before  deducting  therefrom any  compensation  paid or discount
allowed in the sale, underwriting or purchase thereof by underwriters or dealers
or others performing  similar  services,  or any expenses incurred in connection
therewith),  if such  securities are sold to  underwriters or dealers for public
offering  without a  subscription  offering,  or (iii) the gross  amount of cash
actually received by the Company for such securities,  in any other case. 

                            (B) In case of the issuance or sale  (otherwise than
as a dividend or other  distribution on any stock of the Company,  and otherwise
than on the exercise of options, rights


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or  warrants  or the  conversion  or exchange  of  convertible  or  exchangeable
securities) of shares of Common Stock (or of other  securities  deemed hereunder
to involve the issuance or sale of shares of Common  Stock) for a  consideration
part or all of which shall be other than cash,  the amount of the  consideration
therefor  other than cash deemed to have been  received by the Company  shall be
the value of such  consideration  as  determined  in good  faith by the Board of
Directors of the Company,  using customary valuation methods and on the basis of
prevailing market values for similar property or services.

                            (C)  Shares  of  Common  Stock  issuable  by  way of
dividend or other  distribution  on any stock of the Company  shall be deemed to
have been issued  immediately after the opening of business on the day following
the record date for the  determination of shareholders  entitled to receive such
dividend or other  distribution  and shall be deemed to have been issued without
consideration.

                            (D)  The   reclassification  of  securities  of  the
Company other than shares of Common Stock into  securities  including  shares of
Common  Stock shall be deemed to involve  the  issuance of such shares of Common
Stock for a  consideration  other  than cash  immediately  prior to the close of
business on the date fixed for the determination of security holders entitled to
receive such shares, and the value of the consideration allocable to such shares
of Common  Stock  shall be  determined  as provided  in  subsection  (B) of this
Section 8(a).

                            (E) The number of shares of Common  Stock at any one
time  outstanding  shall be deemed to include the  aggregate  maximum  number of
shares issuable  (subject to readjustment upon the actual issuance thereof) upon
the exercise of options,  rights or warrants and upon the conversion or exchange
of convertible or exchangeable securities.


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                            (b)  Upon  each  adjustment  of the  Purchase  Price
pursuant  to this  Section 8, the number of shares of Common  Stock  purchasable
upon the exercise of each Warrant shall be the number derived by multiplying the
number  of  shares  of  Common  Stock  purchasable  immediately  prior  to  such
adjustment by the Purchase Price in effect prior to such adjustment and dividing
the product so obtained by the applicable adjusted Purchase Price.

                            (c) In case the Company  shall at any time after the
date hereof issue options,  rights or warrants to subscribe for shares of Common
Stock, or issue any securities  convertible  into or exchangeable  for shares of
Common Stock, for a consideration  per share (determined as provided in Sections
8(a) and 8(b) and as  provided  below)  less than the  Purchase  Price in effect
immediately prior to the issuance of such options,  rights or warrants,  or such
convertible or exchangeable securities,  or without consideration (including the
issuance of any such securities by way of dividend or other  distribution),  the
Purchase  Price for the  Warrants  (whether  or not the same shall be issued and
outstanding) in effect immediately prior to the issuance of such options, rights
or warrants, or such convertible or exchangeable securities, as the case may be,
shall be reduced to a price  determined by making the  computation in accordance
with the  provisions of Sections 8(a) and 8(b) hereof,  provided  that: 

                            (A) The aggregate maximum number of shares of Common
Stock,  as the case may be,  issuable  or that may  become  issuable  under such
options,  rights  or  warrants  (assuming  exercise  in full  even  if not  then
currently  exercisable  or currently  exercisable in full) shall be deemed to be
issued and outstanding at the time such options, rights or warrants were issued,
for a consideration  equal to the minimum  purchase price per share provided for
in  such  options,  rights  or  warrants  at the  time  of  issuance,  plus  the
consideration,  if any,  received  by the Company  for such  options,  rights or
warrants; provided, however, that upon the expiration


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<PAGE>



or other termination of such options,  rights or warrants,  if any thereof shall
not have been  exercised,  the  number of  shares of Common  Stock  deemed to be
issued and outstanding  pursuant to this subsection (A) (and for the purposes of
subsection  (E) of Section 8(a) hereof) shall be reduced by the number of shares
as to which options,  warrants and/or rights shall have expired, and such number
of shares  shall no longer be  deemed  to be  issued  and  outstanding,  and the
Purchase  Price then in effect shall  forthwith be readjusted  and thereafter be
the price that it would have been had  adjustment  been made on the basis of the
issuance only of the shares actually issued plus the shares  remaining  issuable
upon the exercise of those options,  rights or warrants as to which the exercise
rights shall not have expired or terminated unexercised.

                            (B) The aggregate maximum number of shares of Common
Stock  issuable or that may become  issuable upon  conversion or exchange of any
convertible or exchangeable  securities (assuming conversion or exchange in full
even if not then currently  convertible or exchangeable in full) shall be deemed
to be issued and outstanding at the time of issuance of such  securities,  for a
consideration  equal  to the  consideration  received  by the  Company  for such
securities,  plus the minimum  consideration,  if any, receivable by the Company
upon the  conversion  or  exchange  thereof;  provided,  however,  that upon the
termination of the right to convert or exchange such convertible or exchangeable
securities (whether by reason of redemption or otherwise),  the number of shares
of Common Stock deemed to be issued and outstanding  pursuant to this subsection
(B) (and for the purposes of  subsection  (E) of Section  8(a) hereof)  shall be
reduced by the number of shares as to which the  conversion  or exchange  rights
shall have expired or terminated unexercised, and such number of shares shall no
longer be deemed to be issued and  outstanding,  and the Purchase  Price then in
effect shall  forthwith be readjusted  and thereafter be the price that it would
have been had adjustment been made on


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the basis of the  issuance  only of the shares  actually  issued plus the shares
remaining   issuable  upon  conversion  or  exchange  of  those  convertible  or
exchangeable  securities as to which the conversion or exchange rights shall not
have expired or terminated unexercised.

                            (C) If any change shall occur in the price per share
provided for in any of the options, rights or warrants referred to in subsection
(A) of this  Section  8(c),  or in the  price  per  share or ratio at which  the
securities referred to in subsection (B) of this Section 8(c) are convertible or
exchangeable, such options, rights or warrants or conversion or exchange rights,
as the case may be, to the extent not theretofore exercised,  shall be deemed to
have expired or terminated  on the date when such price change became  effective
in  respect  of shares  not  theretofore  issued  pursuant  to the  exercise  or
conversion or exchange  thereof,  and the Company shall be deemed to have issued
upon such date new options,  rights or warrants or convertible  or  exchangeable
securities. 

                            (d) In case of any  reclassification  or  change  of
outstanding shares of Common Stock issuable upon exercise of the Warrants (other
than a change in par value,  or from par value to no par  value,  or from no par
value to par value or as a result of a subdivision or  combination),  or in case
of any  consolidation or merger of the Company with or into another  corporation
(other  than a merger  with a  subsidiary  of the  Company  in which  merger the
Company  is the  continuing  corporation)  and  which  does  not  result  in any
reclassification  or change of the then  outstanding  shares of Common  Stock or
other capital stock issuable upon exercise of the Warrants  (other than a change
in par  value,  or from par value to no par  value,  or from no par value to par
value or as a result of  subdivision or  combination)  or in case of any sale or
conveyance to another  corporation of the property of the Company as an entirety
or substantially as an entirety,  then, as a condition of such reclassification,
change, consolidation,


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<PAGE>



merger,  sale or  conveyance,  the  Company,  or such  successor  or  purchasing
corporation,  as the case may be,  shall  make  lawful  and  adequate  provision
whereby the Registered  Holder of each Warrant then  outstanding  shall have the
right  thereafter  to receive on exercise of such Warrant the kind and amount of
securities  and  property   receivable  upon  such   reclassification,   change,
consolidation,  merger,  sale  or  conveyance  by a  holder  of  the  number  of
securities  issuable  upon  exercise of such Warrant  immediately  prior to such
reclassification,  change,  consolidation,  merger, sale or conveyance and shall
forthwith file at the Corporate  Office of the Warrant Agent a statement  signed
by  its  Chief  Executive  Officer,  President  or a Vice  President  and by its
Treasurer or an Assistant  Treasurer or its Secretary or an Assistant  Secretary
evidencing  such  provision.   Such  provisions  shall  include   provision  for
adjustments  which shall be as nearly  equivalent as may be  practicable  to the
adjustments  provided for in Sections 8(a), (b) and (c). The above provisions of
this Section 8(d) shall  similarly  apply to  successive  reclassifications  and
changes of shares of Common  Stock and to  successive  consolidations,  mergers,
sales or conveyances.

                            (e)  Irrespective  of any  adjustments or changes in
the  Purchase  Price or the number of shares of Common  Stock  purchasable  upon
exercise of the Warrants,  the Warrant  Certificates  theretofore and thereafter
issued shall,  unless the Company shall exercise its option to issue new Warrant
Certificates  pursuant to Section 2(e) hereof,  continue to express the Purchase
Price per share and the number of shares purchasable  thereunder as the Purchase
Price per share and the number of shares  purchasable  thereunder were expressed
in the Warrant Certificates when the same were originally issued. 

                            (f) After  each  adjustment  of the  Purchase  Price
pursuant to this  Section 8, the Company  will  promptly  prepare a  certificate
signed by the Chairman, Chief Executive


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<PAGE>



Officer or  President,  and by the  Treasurer or an  Assistant  Treasurer or the
Secretary or an  Assistant  Secretary,  of the Company  setting  forth:  (i) the
Purchase  Price as so  adjusted,  (ii) the  number of  shares  of  Common  Stock
purchasable upon exercise of each Warrant,  after such  adjustment,  and (iii) a
brief statement of the facts  accounting for such  adjustment.  The Company will
promptly file such  certificate with the Warrant Agent and cause a brief summary
thereof to be sent by ordinary first class mail to each Registered Holder at his
last address as it shall appear on the registry books of the Warrant  Agent.  No
failure to mail such  notice nor any defect  therein or in the  mailing  thereof
shall  affect the validity  thereof  except as to the holder to whom the Company
failed  to mail  such  notice,  or  except as to the  holder  whose  notice  was
defective.  The affidavit of an officer of the Warrant Agent or the Secretary or
an Assistant Secretary of the Company that such notice has been mailed shall, in
the absence of fraud, be prima facie evidence of the facts stated therein.

                            (g) No  adjustment  of the  Purchase  Price shall be
made as a result of or in connection  with (A) the issuance or sale of shares of
Common  Stock  pursuant to options,  warrants,  stock  purchase  agreements  and
convertible  or  exchangeable  securities  outstanding  or in effect on the date
hereof and on the terms described in the final prospectus relating to the public
offering contemplated by the Underwriting Agreement; or (B) the issuance or sale
of shares of Common  Stock if the amount of said  adjustment  shall be less than
$.10, provided,  however, that in such case, any adjustment that would otherwise
be  required  then to be made shall be carried  forward and shall be made at the
time of and together  with the next  subsequent  adjustment  that shall  amount,
together with any adjustment so carried forward,  to at least $.10. In addition,
Registered  Holders shall not be entitled to cash  dividends paid by the Company
prior to the exercise of any Warrant or Warrants held by them.


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                  SECTION 9. Redemption.
                             ----------
                            (a)  Commencing  on the Initial  Warrant  Redemption
Date, the Company may, on 30 days' prior written notice,  redeem the Warrants at
ten cents ($.0.10) per Warrant, provided, however, that before any such call for
redemption  of Warrants  can take place,  the average  closing bid price for the
Common  Stock as reported by Nasdaq,  if the Common  Stock is then traded on the
Nasdaq Small Cap Market (or the average  closing sale price, if the Common Stock
is then traded on Nasdaq/NM  or on a national  securities  exchange)  shall have
equalled or exceeded  $[____]  [250% of the exercise  price of the Warrants] per
share  for any  twenty  (20)  trading  days  within  a  period  of  thirty  (30)
consecutive  trading  days ending on the fifth  trading day prior to the date on
which the notice contemplated by subsections (b) and (c) below is given (subject
to  adjustment  in the event of any  stock  splits  or other  similar  events as
provided in Section 8 hereof). 

                            (b) In case the Company shall  exercise its right to
redeem all of the  Warrants,  it shall  give or cause to be given  notice to the
Registered  Holders of the  Warrants,  by mailing to such  Registered  Holders a
notice of redemption,  first class,  postage  prepaid,  at their last address as
shall  appear on the  records of the  Warrant  Agent.  Any notice  mailed in the
manner provided  herein shall be  conclusively  presumed to have been duly given
whether or not the Registered  Holder  receives such notice.  Not less than five
(5) business days prior to the mailing to the Registered Holders of the Warrants
of the notice of redemption,  the Company shall deliver or cause to be delivered
to the  Representative a similar notice  telephonically and confirmed in writing
together  with a list of the  Registered  Holders  (including  their  respective
addresses  and number of  Warrants  beneficially  owned) to whom such  notice of
redemption has been or will be given.


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                            (c) The notice of  redemption  shall specify (i) the
redemption price, (ii) the Redemption Date, which shall in no event be less than
thirty (30) days after the date of mailing of such notice, (iii) the place where
the Warrant  Certificate  shall be delivered and the  redemption  price shall be
paid,  and (iv) that the right to exercise the Warrant  shall  terminate at 5:30
p.m.  (New York time) on the business day  immediately  preceding the date fixed
for redemption.  No failure to mail such notice nor any defect therein or in the
mailing thereof shall affect the validity of the proceedings for such redemption
except as to a holder (a) to whom notice was not mailed or (b) whose  notice was
defective.  An  affidavit  of the Warrant  Agent or the  Secretary  or Assistant
Secretary of the Company that notice of redemption has been mailed shall, in the
absence of fraud, be prima facie evidence of the facts stated  therein.  

                            (d) Any right to exercise a Warrant shall  terminate
at 5:30 p.m.  (New York time) on the  business  day  immediately  preceding  the
Redemption Date. The redemption price payable to the Registered Holders shall be
mailed to such persons at their addresses of record.

                            (e) The Company shall  indemnify the  Representative
and each person,  if any, who controls National within the meaning of Section 15
of the Act or Section 20(a) of the Exchange Act against all loss, claim, damage,
expense  or   liability   (including   all  expenses   reasonably   incurred  in
investigating, preparing or defending against any claim whatsoever) to which any
of them may become subject under the Act, the Exchange Act or otherwise, arising
from the registration statement or prospectus referred to in Section 5(b) hereof
to the same extent and with the same effect (including the provisions  regarding
contribution)  as the  provisions  pursuant  to which the  Company has agreed to
indemnify  the  Representative  contained  in  Section  7  of  the  Underwriting
Agreement.


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<PAGE>



                            (f) Five business days prior to the Redemption Date,
the Company shall furnish to the Representative (i) an opinion of counsel to the
Company,  dated such date and addressed to the Representative,  and (ii) a "cold
comfort" letter dated such date addressed to the  Representative,  signed by the
independent  public  accountants  who  have  issued a  report  on the  Company's
financial  statements  included  in such  registration  statement,  in each case
covering  substantially  the same  matters  with  respect  to such  registration
statement  (and  the  prospectus  included  therein)  and,  in the  case of such
accountants'  letter,  with  respect  to events  subsequent  to the date of such
financial statements, as are customarily covered in opinions of issuer's counsel
and in accountants'  letters  delivered to  underwriters in underwritten  public
offerings of  securities.  

                 SECTION 10.  Concerning  the Warrant  Agent. 
                              ------------------------------
                            (a) The Warrant Agent acts hereunder as agent and in
a ministerial  capacity for the Company and the  Representative,  and its duties
shall be determined  solely by the  provisions  hereof.  The Warrant Agent shall
not,  by  issuing  and  delivering  Warrant  Certificates  or by any  other  act
hereunder,  be deemed to make any representations as to the validity or value or
authorization of the Warrant Certificates or the Warrants represented thereby or
of any  securities or other  property  delivered upon exercise of any Warrant or
whether  any  stock  issued  upon  exercise  of any  Warrant  is fully  paid and
nonassessable. 

                            (b) The Warrant Agent shall not at any time be under
any duty or  responsibility  to any  holder of Warrant  Certificates  to make or
cause to be made any adjustment of the Purchase  Price or the  Redemption  Price
provided in this  Agreement,  or to determine  whether any fact exists which may
require  any such  adjustments,  or with  respect to the nature or extent of any
such adjustments, when made, or with respect to the method employed in


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<PAGE>



making the same. It shall not (i) be liable for any recital or statement of fact
contained herein or for any action taken,  suffered or omitted by it in reliance
on any Warrant  Certificate  or other  document or instrument  believed by it in
good  faith to be genuine  and to have been  signed or  presented  by the proper
party or parties, (ii) be responsible for any failure on the part of the Company
to comply with any of its covenants and obligations  contained in this Agreement
or in any  Warrant  Certificate,  or (iii) be liable for any act or  omission in
connection  with this  Agreement  except  for its own  negligence,  bad faith or
willful misconduct.

                            (c) The Warrant  Agent may at any time  consult with
counsel  satisfactory to it (who may be counsel for the Company or for National)
and shall incur no liability or responsibility for any action taken, suffered or
omitted by it in good  faith in  accordance  with the  opinion or advice of such
counsel

                            (d) Any  notice,  statement,  instruction,  request,
direction,  order or demand of the Company shall be sufficiently evidenced by an
instrument  signed by the Chairman of the Board of  Directors,  Chief  Executive
Officer,  President  or any Vice  President  (unless  other  evidence in respect
thereof is herein  specifically  prescribed).  The  Warrant  Agent  shall not be
liable for any action taken,  suffered or omitted by it in accordance  with such
notice, statement,  instruction,  request, direction, order or demand reasonably
believed by it to be genuine.  

                            (e) The  Company  agrees  to pay the  Warrant  Agent
reasonable  compensation for its services  hereunder and to reimburse it for its
reasonable  expenses  hereunder;  the Company  further  agrees to indemnify  the
Warrant Agent and save it harmless from and against any and all losses, expenses
and liabilities,  including judgments, costs and counsel fees, for anything done
or omitted by the Warrant Agent in the execution of its duties


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<PAGE>



and powers hereunder except losses, expenses and liabilities arising as a result
of the Warrant Agent's negligence, bad faith or willful misconduct.

                            (f) The  Warrant  Agent may resign its duties and be
discharged from all further duties and liabilities hereunder (except liabilities
arising  as a result of the  Warrant  Agent's  own gross  negligence  or willful
misconduct), after giving 30 days' prior written notice to the Company. At least
15 days prior to the date such resignation is to become  effective,  the Warrant
Agent  shall  cause a copy of such  notice  of  resignation  to be mailed to the
Registered  Holder of each Warrant  Certificate at the Company's  expense.  Upon
such  resignation,  or  any  inability  of the  Warrant  Agent  to  act as  such
hereunder,  the Company  shall  appoint in writing a new warrant  agent.  If the
Company shall fail to make such appointment  within a period of 15 days after it
has been notified in writing of such resignation by the resigning Warrant Agent,
then the Registered Holder of any Warrant  Certificate may apply to any court of
competent  jurisdiction  for the  appointment  of a new warrant  agent.  Any new
warrant agent,  whether appointed by the Company or by such a court,  shall be a
bank or  trust  company  having  a  capital  and  surplus,  as shown by its last
published  report to its  stockholders,  of not less than $10,000,000 or a stock
transfer  company.  After  acceptance in writing of such  appointment by the new
warrant agent is received by the Company, such new warrant agent shall be vested
with the same  powers,  rights,  duties and  responsibilities  as if it had been
originally  named herein as the Warrant  Agent,  without any further  assurance,
conveyance,  act or  deed;  but if for any  reason  it  shall  be  necessary  or
expedient to execute and deliver any further assurance, conveyance, act or deed,
the same shall be done at the  expense of the  Company  and shall be legally and
validly  executed and delivered by the resigning  Warrant Agent.  Not later than
the effective date of any such appointment the Company shall file notice thereof
with the resigning Warrant Agent and


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<PAGE>



shall  forthwith  cause a copy of such  notice to be  mailed  to the  Registered
Holder of each Warrant Certificate.

                            (g) Any corporation  into which the Warrant Agent or
any new warrant agent may be converted or merged, any corporation resulting from
any consolidation to which the Warrant Agent or any new warrant agent shall be a
party,  or any  corporation  succeeding to the corporate  trust  business of the
Warrant Agent or any new warrant agent shall be a successor  warrant agent under
this  Agreement  without any further  act,  provided  that such  corporation  is
eligible for  appointment as successor to the Warrant Agent under the provisions
of the preceding  paragraph.  Any such  successor  warrant agent shall  promptly
cause notice of its  succession as warrant agent to be mailed to the Company and
to the Registered  Holders of each Warrant  Certificate. 

                            (h)  The  Warrant  Agent,   its   subsidiaries   and
affiliates,  and any of its or their officers or directors,  may buy and hold or
sell Warrants or other  securities  of the Company and  otherwise  deal with the
Company in the same manner and to the same extent and with like effect as though
it were not Warrant Agent.  Nothing herein shall preclude the Warrant Agent from
acting in any other capacity for the Company or for any other legal entity.  (i)
The  Warrant  Agent  shall  retain  for a period of two  years  from the date of
exercise any Warrant Certificate received by it upon such exercise.  SECTION 11.
Modification of Agreement. The Warrant Agent and the Company may by supplemental
agreement  make any changes or corrections in this Agreement

                            (i) that they  shall  deem  appropriate  to cure any
ambiguity  or to correct any  defective  or  inconsistent  provision or manifest
mistake  or error  herein  contained;  or (ii) that they may deem  necessary  or
desirable and which shall not adversely


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<PAGE>



affect the interests of the holders of Warrant Certificates;  provided, however,
that this Agreement shall not otherwise be modified,  supplemented or altered in
any  respect  except  with the  consent  in writing  of the  Registered  Holders
representing not less than 66-2/3% of the Warrants then  outstanding;  provided,
further,  that no change in the number or nature of the  securities  purchasable
upon the exercise of any Warrant,  or to increase the Purchase Price therefor or
to accelerate the Warrant  Expiration Date, shall be made without the consent in
writing of the Registered  Holder of the Warrant  Certificate  representing such
Warrant,  other than such changes as are  presently  specifically  prescribed by
this Agreement as originally  executed.  In addition,  this Agreement may not be
modified, amended or supplemented without the prior written consent of National,
other  than  to  cure  any  ambiguity  or to  correct  any  provision  which  is
inconsistent  with any other  provision  of this  Agreement  or to make any such
change that is necessary or desirable and which shall not  adversely  affect the
interests of National and except as may be required by law.

                  SECTION 12.  Notices.
                               -------
                  All  notices,  requests,  consents  and  other  communications
hereunder  shall be in  writing  and  shall be  deemed  to have  been  made when
delivered or mailed  first-class  registered or certified mail, postage prepaid,
as follows: if to the Registered Holder of a Warrant Certificate, at the address
of such holder as shown on the registry  books  maintained by the Warrant Agent;
if to the Company at 2665 Villa Creek Drive,  Dallas,  Texas  75234,  Attention:
Glenn A. Norem,  Chief Executive  Officer,  or at such other address as may have
been  furnished to the Warrant  Agent in writing by the  Company;  and if to the
Warrant Agent, at its Corporate Office.  Copies of any notice delivered pursuant
to this Agreement  shall also be delivered to National  Securities  Corporation,
1001 Fourth Avenue, Suite 2200, Seattle, Washington 98154-


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<PAGE>



1100,  Attention:  General  Counsel,  or at such other  address as may have been
furnished to the Company and the Warrant Agent in writing.

                  SECTION 13.  Governing Law.
                               -------------
                  This   Agreement   shall  be  governed  by  and  construed  in
accordance  with the laws of the  State of New York  without  giving  effect  to
conflicts of laws.

                  SECTION 14.  Binding Effect.
                               --------------
                  This Agreement  shall be binding upon and inure to the benefit
of the Company,  National, the Warrant Agent and their respective successors and
assigns  and the  holders  from time to time of Warrant  Certificates  or any of
them. Nothing in this Agreement is intended or shall be construed to confer upon
any other person any right,  remedy or claim,  in equity or at law, or to impose
upon any other person any duty, liability or obligation.

                  SECTION 15.  Termination.
                               -----------
                  This Agreement shall terminate at the close of business on the
Expiration  Date of all of the  Warrants  or such  earlier  date upon  which all
Warrants  have been  exercised or redeemed,  except that the Warrant Agent shall
account  to the  Company  for cash held by it and the  provisions  of Section 10
hereof shall survive such termination.

                  SECTION 16.  Counterparts.
                               ------------
                  This Agreement may be executed in several counterparts,  which
taken together shall constitute a single document.


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<PAGE>



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

[SEAL]
                                             MULTIMEDIA ACCESS CORPORATION


                                             By:
                                                --------------------------------
                                                Glenn A. Norem
                                                Chief Executive Officer

Attest:


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

                                             CONTINENTAL STOCK TRANSFER & TRUST
                                             COMPANY,
                                              As Warrant Agent


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


<PAGE>




                                                                       EXHIBIT A
                                                                       ---------


No. W                                                 VOID AFTER _________, 2001

                                                      WARRANTS


                        REDEEMABLE WARRANT CERTIFICATE TO
                         PURCHASE SHARES OF COMMON STOCK

                          MULTIMEDIA ACCESS CORPORATION

                                            CUSIP_______

THIS CERTIFIES THAT, FOR VALUE RECEIVED


or registered  assigns (the  "Registered  Holder") is the owner of the number of
Redeemable  Warrants (the "Warrants")  specified above.  Each Warrant  initially
entitles the Registered Holder to purchase,  subject to the terms and conditions
set  forth  in  this  Certificate  and the  Warrant  Agreement  (as  hereinafter
defined),  one fully paid and  nonassessable  share of Common  Stock,  $.001 par
value, of Multimedia Access Corporation, a Delaware corporation (the "Company"),
at any time  between , 1997  (the  "Initial  Warrant  Exercise  Date"),  and the
Expiration Date (as hereinafter  defined) upon the presentation and surrender of
this Warrant  Certificate with the Subscription  Form on the reverse hereof duly
executed, at the corporate office of Continental Stock Transfer & Trust Company,
as warrant agent, or its successor (the "Warrant Agent"), accompanied by payment
of $[_____]  [120% of the initial  public  offering  price of the Common Stock],
subject to  adjustment  (the  "Purchase  Price"),  in lawful money of the United
States of America in cash or by check made payable to the Warrant  Agent for the
account of the Company.

                This Warrant Certificate and each Warrant represented hereby are
issued  pursuant to and are subject in all respects to the terms and  conditions
set forth in the Warrant Agreement (the "Warrant Agreement"), dated , 1996 [date
of the Prospectus],  by and among the Company,  National Securities  Corporation
and the Warrant Agent.

                In  the  event  of  certain  contingencies  provided  for in the
Warrant  Agreement,  the Purchase Price and the number of shares of Common Stock
subject to purchase  upon the  exercise of each Warrant  represented  hereby are
subject to modification or adjustment.

                Each Warrant  represented hereby is exercisable at the option of
the Registered Holder,  but no fractional  interests will be issued. In the case
of the exercise of less than all the Warrants  represented  hereby,  the Company
shall cancel this Warrant Certificate upon the


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<PAGE>



surrender  hereof and shall  execute and deliver a new  Warrant  Certificate  or
Warrant  Certificates of like tenor,  which the Warrant Agent shall countersign,
for the balance of such Warrants.

                The term "Expiration  Date" shall mean 5:30 p.m. (New York time)
on ___________,  2001 [fifty-four (54) months after the Initial Warrant Exercise
Date]. If each such date shall in the State of New York be a holiday or a day on
which the banks are  authorized to close,  then the  Expiration  Date shall mean
5:30 p.m.  (New York time) on the next  following  day which in the State of New
York is not a holiday or a day on which banks are authorized to close.

                The Company  shall not be  obligated  to deliver any  securities
pursuant to the exercise of this Warrant unless a registration  statement  under
the  Securities  Act of 1933,  as  amended  (the  "Act"),  with  respect to such
securities is effective or an exemption thereunder is available. The Company has
covenanted  and  agreed  that it will file a  registration  statement  under the
Federal  securities  laws,  use its best  efforts  to cause  the same to  become
effective,  use its best efforts to keep such registration statement current, if
required under the Act, while any of the Warrants are outstanding, and deliver a
prospectus  which  complies with Section  10(a)(3) of the Act to the  Registered
Holder  exercising  this  Warrant.  This Warrant shall not be  exercisable  by a
Registered Holder in any state where such exercise would be unlawful.

                This Warrant  Certificate  is  exchangeable,  upon the surrender
hereof by the  Registered  Holder at the corporate  office of the Warrant Agent,
for a new Warrant Certificate or Warrant Certificates of like tenor representing
an equal aggregate number of Warrants,  each of such new Warrant Certificates to
represent  such  number of Warrants as shall be  designated  by such  Registered
Holder at the time of such  surrender.  Upon due  presentment and payment of any
tax or other charge  imposed in connection  therewith or incident  thereto,  for
registration  of transfer of this  Warrant  Certificate  at such  office,  a new
Warrant  Certificate or Warrant  Certificates  representing  an equal  aggregate
number of  Warrants  will be  issued to the  transferee  in  exchange  therefor,
subject to the limitations provided in the Warrant Agreement.

                Prior to the  exercise of any Warrant  represented  hereby,  the
Registered  Holder shall not be entitled to any rights of a  stockholder  of the
Company,  including,  without  limitation,  the  right  to  vote  or to  receive
dividends  or other  distributions,  and shall not be  entitled  to receive  any
notice of any  proceedings  of the  Company,  except as  provided in the Warrant
Agreement.

                Subject to the provisions of the Warrant Agreement, this Warrant
may be redeemed at the option of the Company, at a redemption price of $0.01 per
Warrant, at any time commencing after ______________,  1998 [18 months after the
effective date of the Registration Statement], provided that the average closing
bid price for the Common  Stock as reported by the Nasdaq  Small Cap Market,  if
the Common  Stock is then traded on the Nasdaq  Small Cap Market (or the average
closing sale price,  if the Common  Stock is then traded on the Nasdaq  National
Market or a national securities exchange), shall have equalled or exceeded $ per
share [250% of the exercise  price of the  warrants] for any twenty (20) trading
days within a period of thirty (30) consecutive trading days ending on the fifth
trading  day prior to the Notice of  Redemption,  as defined  below  (subject to
adjustment in the event of any stock splits or other similar events).  Notice of
redemption (the "Notice of Redemption") shall be given not later than


NY1-161301.1
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                                       A-2

<PAGE>



the thirtieth day before the date fixed for  redemption,  all as provided in the
Warrant  Agreement.  On and after the date fixed for redemption,  the Registered
Holder shall have no rights with  respect to the Warrants  except to receive the
$0.01 per Warrant upon surrender of this Warrant Certificate.

                  Under certain  circumstances,  National Securities Corp. shall
be entitled to receive an aggregate of five percent of the purchase price of the
Warrants represented hereby.

                Prior to due  presentment for  registration of transfer  hereof,
the Company and the Warrant  Agent may deem and treat the  Registered  Holder as
the   absolute   owner   hereof   and  of  each   Warrant   represented   hereby
(notwithstanding  any  notations of  ownership or writing  hereon made by anyone
other than a duly  authorized  officer of the Company or the Warrant  Agent) for
all purposes and shall not be affected by any notice to the contrary,  except as
provided in the Warrant Agreement.

                This Warrant  Certificate  shall be governed by and construed in
accordance  with the laws of the  State of New York  without  giving  effect  to
conflicts of laws.

                This Warrant  Certificate is not valid unless  countersigned  by
the Warrant Agent.

                IN  WITNESS  WHEREOF,   the  Company  has  caused  this  Warrant
Certificate to be duly executed, manually or in facsimile by two of its officers
thereunto duly  authorized and a facsimile of its corporate seal to be imprinted
hereon.

Dated:

                              MULTIMEDIA ACCESS CORPORATION
[SEAL]


                              By:
                                 -----------------------------------------------
                                 Glenn A. Norem
                                 Chief Executive Officer


                              By:
                                 -----------------------------------------------
                                 William S. Leftwich
                                 Chief Financial Officer and Assistant Secretary

COUNTERSIGNED:

CONTINENTAL STOCK TRANSFER & TRUST COMPANY,
  as Warrant Agent


By:
     Authorized Officer


NY1-161301.1
                                                            8789-10-MZ1-10/29/96
                                       A-3

<PAGE>



                                SUBSCRIPTION FORM
                                -----------------

                     To Be Executed by the Registered Holder
                          in Order to Exercise Warrants

                The undersigned  Registered Holder hereby  irrevocably elects to
exercise  _________  Warrants  represented by this Warrant  Certificate,  and to
purchase  the  securities  issuable  upon the  exercise  of such  Warrants,  and
requests that certificates for such securities shall be issued in the name of

                          PLEASE INSERT SOCIAL SECURITY
                           OR OTHER IDENTIFYING NUMBER

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

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

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

                            --------------------------
                     (please print or type name and address)

and be delivered to

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

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

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

                            --------------------------
                    (please print or type name and address)

and if such number of Warrants  shall not be all the Warrants  evidenced by this
Warrant  Certificate,  that a new  Warrant  Certificate  for the balance of such
Warrants be registered in the name of, and delivered to, the  Registered  Holder
at the address stated below.

                    IMPORTANT: PLEASE COMPLETE THE FOLLOWING

            1. The exercise of this Warrant was solicited by National Securities
               Corporation unless the following box is checked.              |_|

            2. The exercise of this Warrant was solicited by ______________. |_|

            3. If  the exercise of  this Warrant was not solicited, please check
               the following box.                                            |_|

Dated: _____________________                          X_________________________

                                                       _________________________

                                                       _________________________
                                                               Address


NY1-161301.1
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                                       A-4

<PAGE>



                                   ASSIGNMENT
                                   ----------

                     To Be Executed by the Registered Holder
                           in Order to Assign Warrants

                FOR VALUE RECEIVED, _________________, hereby sells, assigns and
transfers unto

                        PLEASE INSERT SOCIAL SECURITY OR
                            OTHER IDENTIFYING NUMBER\

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

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

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

                            ------------------------
                     (please print or type name and address)

________________________of the Warrants represented by this Warrant Certificate,
and hereby irrevocably constitutes and appoints_________________________________
Attorney to transfer this Warrant Certificate on the books of the Company,  with
full power of substitution in the premises.

Dated: ____________________                       X _______________________
                                                    Signature Guaranteed

                                                    _______________________


THE SIGNATURE TO THE ASSIGNMENT OR THE SUBSCRIPTION  FORM MUST CORRESPOND TO THE
NAME AS WRITTEN UPON THE FACE OF THIS WARRANT  CERTIFICATE IN EVERY  PARTICULAR,
WITHOUT  ALTERATION  OR  ENLARGEMENT  OR  ANY  CHANGE  WHATSOEVER  AND  MUST  BE
GUARANTEED BY AN ELIGIBLE GUARANTOR  INSTITUTION (BANKS,  STOCKBROKERS,  SAVINGS
AND LOAN ASSOCIATIONS AND CREDIT UNIONS WITH MEMBERSHIP IN AN APPROVED SIGNATURE
GUARANTEE MEDALLION PROGRAM), PURSUANT TO S.E.C. RULE 17Ad-15.


NY1-161301.1
                                                            8789-10-MZ1-10/29/96
                                       A-5



                                                                       OHS DRAFT
                                                                        10/25/96


                  [FORM OF REPRESENTATIVE'S WARRANT AGREEMENT]
               [SUBJECT TO ADDITIONAL INTERNAL AND CLIENT REVIEW]

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






                          MULTIMEDIA ACCESS CORPORATION

                                       AND

                         NATIONAL SECURITIES CORPORATION


                                   ----------







                                REPRESENTATIVE'S
                                WARRANT AGREEMENT



                           Dated as of ________, 1996



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


NY1-161299.2

<PAGE>



                  REPRESENTATIVE'S  WARRANT AGREEMENT dated as of _______,  1996
between MULTIMEDIA ACCESS CORPORATION,  a Delaware  corporation (the "Company"),
and NATIONAL SECURITIES  CORPORATION  (hereinafter  referred to variously as the
"Holder" or the "Representative").

                              W I T N E S S E T H:

                  WHEREAS,  the Company proposes to issue to the  Representative
warrants ("Warrants") to purchase up to an aggregate of 180,000 shares of Common
Stock,  $0.0001 par value, of the Company and/or 180,000 redeemable common stock
purchase  warrants  of the  Company  ("Redeemable  Warrants"),  each  Redeemable
Warrant to purchase one additional share of Common Stock; and

                  WHEREAS,   the  Representative  has  agreed  pursuant  to  the
underwriting  agreement  (the  "Underwriting  Agreement")  dated  as of the date
hereof between the Company and the several Underwriters listed therein to act as
the  Representative in connection with the Company's proposed public offering of
up to 1,800,000  shares of Common Stock and 1,800,000  Redeemable  Warrants (the
"Public  Warrants")  at a public  offering  price of $[___]  per share of Common
Stock and $[___] per Public Warrant (the "Public Offering"); and

                  WHEREAS,  the Warrants to be issued pursuant to this Agreement
will be issued on the Closing Date (as such term is defined in the  Underwriting
Agreement) by the Company to the  Representative  in  consideration  for, and as
part of the Representative's compensation in connection with, the Representative
acting as the Representative pursuant to the Underwriting Agreement;


NY1-161299.2

<PAGE>



                  NOW, THEREFORE,  in consideration of the premises, the payment
by the  Representative to the Company of an aggregate eighteen dollars ($18.00),
the  agreements  herein  set forth and other  good and  valuable  consideration,
hereby acknowledged, the parties hereto agree as follows:

                  1. Grant.  The  Representative  (or its  designees)  is hereby
granted the right to purchase, at any time from _______, 1997 [one year from the
effective date of the Registration  Statement],  until 5:30 P.M., New York time,
on  _______,  2001  [five  years  from the  effective  date of the  Registration
Statement],  up to an aggregate of 180,000 shares of Common Stock and/or 180,000
Redeemable  Warrants at an initial  exercise  price  (subject to  adjustment  as
provided in Section 8 hereof) of $[____] per share of Common  Stock [120% of the
initial public  offering  price] and $[___] per Redeemable  Warrant [120% of the
initial  public  offering  price],  subject to the terms and  conditions of this
Agreement.  One  Redeemable  Warrant is  exercisable  to purchase one additional
share of  Common  Stock at an  initial  exercise  price of  $[___]  (140% of the
initial public  offering price per share) from _______,  1997 [one year from the
effective date of the  Registration  Statement] until 5:30 p.m. New York time on
_____, 2001 [five years from the effective date of the Registration  Statement],
at which time the Redeemable Warrants shall expire.  Except as set forth herein,
the shares of Common Stock and the Redeemable Warrants issuable upon exercise of
the Warrants are in all respects identical to the shares of Common Stock and the
Public  Warrants being  purchased by the  Underwriters  for resale to the public
pursuant to the terms and provisions of the Underwriting  Agreement.  The shares
of Common  Stock and the  Redeemable  Warrants  issuable  upon  exercise  of the
Warrants are sometimes hereinafter referred to collectively as the "Securities."


NY1-161299.2
                                      - 2 -

<PAGE>



                  2.  Warrant   Certificates.   The  warrant  certificates  (the
"Warrant Certificates") delivered and to be delivered pursuant to this Agreement
shall be in the form set forth in  Exhibit  A,  attached  hereto and made a part
hereof, with such appropriate insertions,  omissions,  substitutions,  and other
variations as required or permitted by this Agreement.

                  3.  Exercise of Warrant.

                  Section 3.1 Method of  Exercise.  The Warrants  initially  are
exercisable  at an aggregate  initial  exercise  price (subject to adjustment as
provided in Section 8 hereof) per share of Common Stock and  Redeemable  Warrant
set forth in Section 6 hereof payable by certified or official bank check in New
York  Clearing  House  funds,  subject to  adjustment  as  provided in Section 8
hereof.  Upon  surrender  of a  Warrant  Certificate  with the  annexed  Form of
Election to Purchase duly executed,  together with payment of the Exercise Price
(as  hereinafter  defined)  for the  shares of Common  Stock  and/or  Redeemable
Warrants purchased at the Company's principal executive offices in Dallas, Texas
(presently  located at 2665 Villa Creek Drive,  Suite 200, Dallas,  Texas 75234)
the registered holder of a Warrant Certificate  ("Holder" or "Holders") shall be
entitled to receive a certificate or certificates for the shares of Common Stock
so purchased and a certificate or  certificates  for the Redeemable  Warrants so
purchased.  The purchase  rights  represented  by each Warrant  Certificate  are
exercisable at the option of the Holder thereof, in whole or in part (but not as
to fractional shares of the Common Stock and Redeemable  Warrants underlying the
Warrants).  In the event the Company  redeems all of the Public  Warrants (other
than the Redeemable  Warrants  underlying  the Warrants),  then the Warrants may
only be exercised if such exercise is accompanied by the  simultaneous  exercise
of the  Redeemable  Warrant(s)  underlying  the  Warrants  being  so  exercised.
Warrants  may be exercised to purchase all or part of the shares of Common Stock
together with an equal or


NY1-161299.2
                                      - 3 -

<PAGE>



unequal number of the Redeemable  Warrants  represented  thereby. In the case of
the  purchase  of less than all the  shares of Common  Stock  and/or  Redeemable
Warrants  purchasable  under any Warrant  Certificate,  the Company shall cancel
said  Warrant  Certificate  upon the  surrender  thereof  and shall  execute and
deliver a new Warrant Certificate of like tenor for the balance of the shares of
Common Stock and/or Redeemable Warrants purchasable thereunder.

                  Section 3.2 Exercise by  Surrender of Warrant.  In addition to
the method of payment set forth in Section  3.1 and in lieu of any cash  payment
required  thereunder,  the Holder(s) of the Warrants shall have the right at any
time  and  from  time to time to  exercise  the  Warrants  in full or in part by
surrendering  the Warrant  Certificate  in the manner  specified  in Section 3.1
hereof.  The  number of shares of  Common  Stock to be issued  pursuant  to this
Section 3.2 shall be equal to the difference between (a) the number of shares of
Common Stock in respect of which the Warrants are  exercised and (b) a fraction,
the  numerator of which shall be the number of shares of Common Stock in respect
of which the Warrants are  exercised  multiplied  by the Exercise  Price and the
denominator  of which  shall be the Market  Price (as  defined  in  Section  3.3
hereof) of the Common  Stock.  The number of  Redeemable  Warrants  to be issued
pursuant to this  Section 3.2 shall be equal to the  difference  between (a) the
number of Redeemable Warrants in respect of which the Warrants are exercised and
(b) a  fraction,  the  numerator  of which  shall be the  number  of  Redeemable
Warrants  in respect  of which the  Warrants  are  exercised  multiplied  by the
Exercise  Price  and the  denominator  of which  shall be the  Market  Price (as
defined  in  Section  3.3  hereof) of the  Redeemable  Warrants.  Solely for the
purposes of this paragraph,  Market Price shall be calculated  either (i) on the
date which the form of election  attached  hereto is deemed to have been sent to
the Company pursuant to Section 14


NY1-161299.2
                                      - 4 -

<PAGE>



hereof  ("Notice  Date") or (ii) as the average of the Market Prices for each of
the five trading  days  preceding  the Notice Date,  whichever of (i) or (ii) is
greater. 

                  Section 3.3  Definition of Market Price.  As used herein,  the
phrase  "Market  Price" at any date shall be deemed to be (i) when  referring to
the Common Stock,  the last  reported  sale price,  or, in case no such reported
sale takes place on such day, the average of the last  reported  sale prices for
the last three (3) trading days,  in either case as  officially  reported by the
principal securities exchange on which the Common Stock is listed or admitted to
trading or by the Nasdaq National Market ("Nasdaq/NM"),  or, if the Common Stock
is not listed or  admitted  to trading on any  national  securities  exchange or
quoted by the National  Association of Securities  Dealers  Automated  Quotation
System  ("Nasdaq"),  the average  closing bid price as furnished by the National
Association  of Securities  Dealers,  Inc.  ("NASD")  through  Nasdaq or similar
organization if Nasdaq is no longer reporting such information, or if the Common
Stock is not quoted on Nasdaq,  as  determined  in good faith  (using  customary
valuation methods) by resolution of the members of the Board of Directors of the
Company, based on the best information available to it or (ii) when referring to
a Redeemable  Warrant,  the last reported  sales price,  or, in the case no such
reported  sale takes place on such day,  the average of the last  reported  sale
prices  for the last  three  (3)  trading  days,  in either  case as  officially
reported by the principal  securities  exchange on which the Redeemable Warrants
are  listed or  admitted  to  trading  or by  Nasdaq/NM,  or, if the  Redeemable
Warrants  are not  listed or  admitted  to trading  on any  national  securities
exchange or quoted by Nasdaq,  the average closing bid price as furnished by the
NASD through  Nasdaq or similar  organization  if Nasdaq is no longer  reporting
such information,  or if the Redeemable Warrants are not quoted on Nasdaq or are
no longer


NY1-161299.2
                                      - 5 -

<PAGE>



outstanding, the Market Price of a Redeemable Warrant shall equal the difference
between  the Market  Price of the  Common  Stock and the  Exercise  Price of the
Redeemable Warrant.

                  4.  Issuance  of  Certificates.   Upon  the  exercise  of  the
Warrants,  the  issuance  of  certificates  for  shares of Common  Stock  and/or
Redeemable  Warrants and/or other  securities,  properties or rights  underlying
such Warrants and, upon the exercise of the Redeemable Warrants, the issuance of
certificates for shares of Common Stock and/or other  securities,  properties or
rights  underlying such Redeemable  Warrants shall be made forthwith (and in any
event within five (5) business  days  thereafter)  without  charge to the Holder
thereof including,  without limitation,  any tax which may be payable in respect
of the issuance thereof,  and such certificates shall (subject to the provisions
of Sections 5 and 7 hereof) be issued in the name of, or in such names as may be
directed by, the Holder thereof;  provided,  however, that the Company shall not
be  required  to pay any tax which may be payable  in  respect  of any  transfer
involved in the issuance and delivery of any such  certificates  in a name other
than that of the  Holder,  and the  Company  shall not be  required  to issue or
deliver such certificates  unless or until the person or persons  requesting the
issuance  thereof shall have paid to the Company the amount of such tax or shall
have established to the satisfaction of the Company that such tax has been paid.
              
    The Warrant Certificates and the certificates representing the
shares of Common Stock and the Redeemable  Warrants  underlying the Warrants and
the shares of Common Stock  underlying  the  Redeemable  Warrants  (and/or other
securities,  properties or rights  issuable upon the exercise of the Warrants or
the  Redeemable  Warrants)  shall be  executed  on behalf of the  Company by the
manual or facsimile signature of the then Chairman or Vice Chairman of the Board
of Directors or President or Vice President of the Company. Warrant Certificates
shall


NY1-161299.2
                                      - 6 -

<PAGE>



be dated the date of execution by the Company upon initial  issuance,  division,
exchange,  substitution  or transfer.  Certificates  representing  the shares of
Common Stock and Redeemable Warrants,  and the shares of Common Stock underlying
each Redeemable Warrant (and/or other securities,  properties or rights issuable
upon exercise of the Warrants) shall be dated as of the Notice Date  (regardless
of when executed or delivered) and dividend  bearing  securities so issued shall
accrue dividends from the Notice Date.

                  5.  Restriction  On  Transfer  of  Warrants.  The  Holder of a
Warrant  Certificate,  by its acceptance thereof,  covenants and agrees that the
Warrants  are  being  acquired  as an  investment  and  not  with a view  to the
distribution thereof; that the Warrants may not be sold, transferred,  assigned,
hypothecated or otherwise  disposed of, in whole or in part, for a period of one
(1) year from the date hereof, except to officers of the Representative.
                  6.       Exercise Price.

                  Section 6.1 Initial and  Adjusted  Exercise  Price.  Except as
otherwise  provided  in Section 8 hereof,  the  initial  exercise  price of each
Warrant  shall be $[___] per share of Common  Stock [120% of the initial  public
offering  price per share of Common  Stock] and $[___]  per  Redeemable  Warrant
[120% of the initial  public  offering price per Public  Warrant].  The adjusted
exercise  price shall be the price which shall result from time to time from any
and all  adjustments  of the  initial  exercise  price  in  accordance  with the
provisions of Section 8 hereof.  Any transfer of a Warrant  shall  constitute an
automatic  transfer  and  assignment  of the  registration  rights  set forth in
Section 7 hereof with respect to the Securities or other securities,  properties
or rights underlying the Warrants.


NY1-161299.2
                                      - 7 -

<PAGE>



                  Section 6.2 Exercise Price.  The term "Exercise  Price" herein
shall mean the initial exercise price or the adjusted exercise price,  depending
upon the context or unless otherwise specified.  

                  7. Registration Rights.

                  Section 7.1 Registration Under the Securities Act of 1933. The
Warrants,  the shares of Common  Stock and any other  securities  issuable  upon
exercise of the Warrants have not been  registered  under the  Securities Act of
1933 as  amended  (the  "Act").  Upon  exercise,  in whole  or in  part,  of the
Warrants,  certificates  representing the Shares underlying the Warrants and any
of the other  securities  issuable upon exercise of the Warrants  (collectively,
the  "Warrant  Securities")  shall bear the  following  legend:  The  securities
represented by this  certificate  have not been registered  under the Securities
Act of 1933, as amended ("Act"),  and may not be offered or sold except pursuant
to (i) an effective  registration  statement  under the Act,  (ii) to the extent
applicable,  Rule 144 under the Act (or any similar rule under such Act relating
to the  disposition  of  securities),  or (iii) an opinion of  counsel,  if such
opinion  shall be  reasonably  satisfactory  to counsel to the  issuer,  that an
exemption from registration under such Act is available.

                  Section 7.2 Piggyback Registration. If, at any time commencing
after the date  hereof and  expiring  seven (7) years  thereafter,  the  Company
proposes to register any of its securities under the Act (other than pursuant to
Form S-4, Form S-8 or a comparable  registration statement) it will give written
notice by registered mail, at least thirty (30) days prior to the filing of each
such registration  statement,  to the Representative and to all other Holders of
the Warrants  and/or the Warrant  Securities  of its  intention to do so. If the
Representative or other Holders of the Warrants and/or Warrant Securities notify
the Company within twenty (20) business days after receipt of any such notice of
its or their desire to include any such


NY1-161299.2
                                      - 8 -

<PAGE>



securities in such proposed registration statement, the Company shall afford the
Representative  and such Holders of the Warrants  and/or Warrant  Securities the
opportunity  to  have  any  such  Warrant   Securities   registered  under  such
registration statement.

                  Notwithstanding  the  provisions  of  this  Section  7.2,  the
Company  shall  have the right at any time  after it shall  have  given  written
notice pursuant to this Section 7.2  (irrespective  of whether a written request
for inclusion of any such securities  shall have been made) to elect not to file
any such  proposed  registration  statement,  or to withdraw  the same after the
filing but prior to the effective date thereof.

                  Section 7.3  Demand Registration.

                  (a) At any time commencing  after the date hereof and expiring
five (5) years thereafter, the Holders of the Warrants and/or Warrant Securities
representing a "Majority" (as hereinafter  defined) of such securities (assuming
the  exercise of all of the  Warrants)  shall have the right  (which right is in
addition to the  registration  rights under Section 7.2 hereof),  exercisable by
written  notice to the  Company,  to have the Company  prepare and file with the
Securities  and Exchange  Commission  (the  "Commission"),  on one  occasion,  a
registration statement and such other documents,  including a prospectus, as may
be  necessary in the opinion of both counsel for the Company and counsel for the
Representative  and Holders,  in order to comply with the provisions of the Act,
so as to  permit  a  public  offering  and  sale  of  their  respective  Warrant
Securities for nine (9) consecutive months by such Holders and any other Holders
of the Warrants and/or Warrant Securities who notify the Company within ten (10)
days after  receiving  notice from the Company of such request.  

                  (b) The Company covenants and agrees to give written notice of
any registration  request under this Section 7.3 by any Holder or Holders to all
other registered Holders of the


NY1-161299.2
                                      - 9 -

<PAGE>



Warrants  and the Warrant  Securities  within ten (10) days from the date of the
receipt of any such registration request.

                  (c) In addition to the  registration  rights under Section 7.2
and  subsection (a) of this Section 7.3, at any time  commencing  after the date
hereof and expiring  five (5) years  thereafter,  any Holder of Warrants  and/or
Warrant  Securities shall have the right,  exercisable by written request to the
Company,  to have the  Company  prepare  and  file,  on one  occasion,  with the
Commission a registration  statement so as to permit a public  offering and sale
for nine (9)  consecutive  months by any such Holder of its  Warrant  Securities
provided,  however, that the provisions of Section 7.4(b) hereof shall not apply
to any such registration request and registration and all costs incident thereto
shall be at the expense of the Holder or Holders making such request.

                  (d) Notwithstanding anything to the contrary contained herein,
if the Company  shall not have filed a  registration  statement  for the Warrant
Securities within the time period specified in Section 7.4(a) hereof pursuant to
the written  notice  specified in Section 7.3(a) of a Majority of the Holders of
the Warrants and/or Warrant Securities, the Company may, at its option, upon the
written  notice of election of a Majority of the Holders of the Warrants  and/or
Warrant  Securities  requesting  such  registration,  repurchase (i) any and all
Warrant  Securities  of such Holders at the higher of the Market Price per share
of Common  Stock and per  Redeemable  Warrant on (x) the date of the notice sent
pursuant to Section  7.3(a) or (y) the  expiration  of the period  specified  in
Section  7.4(a) and (ii) any and all  Warrants  of such  Holders at such  Market
Price less the  Exercise  Price of such  Warrant.  Such  repurchase  shall be in
immediately  available funds and shall close within two (2) days after the later
of (i) the


NY1-161299.2
                                     - 10 -

<PAGE>



expiration of the period specified in Section 7.4(a) or (ii) the delivery of the
written notice of election specified in this Section 7.3(d).

                  Section  7.4   Covenants   of  the  Company  With  Respect  to
Registration.  In  connection  with any  registration  under  Section 7.2 or 7.3
hereof,  the Company covenants and agrees as follows:  

                  (a)  The  Company  shall  use  its  best  efforts  to  file  a
registration  statement  within  thirty  (30)  days  of  receipt  of any  demand
therefor,  shall  use its  best  efforts  to have  any  registration  statements
declared  effective at the earliest possible time, and shall furnish each Holder
desiring  to sell  Warrant  Securities  such  number  of  prospectuses  as shall
reasonably be requested. 

                  (b) The  Company  shall  pay all  costs  (excluding  fees  and
expenses of Holder(s)'  counsel and any  underwriting  or selling  commissions),
fees and expenses in connection with all registration  statements filed pursuant
to Sections 7.2 and 7.3 hereof  including,  without  limitation,  the  Company's
legal and accounting fees, printing expenses, blue sky fees and expenses. If the
Company shall fail to comply with Section 7.4(a), the Company shall, in addition
to any other equitable or other relief available to the Holder(s), be liable for
any and all incidental or special damages sustained by the Holder(s)  requesting
registration of its or their Warrants and/or Warrant Securities. 

                  (c) The Company  will take all  necessary  action which may be
required in  qualifying  or  registering  the Warrant  Securities  included in a
registration  statement  for offering and sale under the  securities or blue sky
laws of such states as reasonably are requested by the Holder(s),  provided that
the Company shall not be obligated to execute or file any general


NY1-161299.2
                                     - 11 -

<PAGE>



consent to service  of  process  or to  qualify as a foreign  corporation  to do
business under the laws of any such jurisdiction.

                  (d) The Company  shall  indemnify the Holder(s) of the Warrant
Securities to be sold pursuant to any registration statement and each person, if
any,  who controls  such Holders  within the meaning of Section 15 of the Act or
Section  20(a) of the  Securities  Exchange Act of 1934,  as amended  ("Exchange
Act"),  against all loss,  claim,  damage,  expense or liability  (including all
expenses  reasonably  incurred in investigating,  preparing or defending against
any claim whatsoever) to which any of them may become subject under the Act, the
Exchange Act or otherwise,  arising from such registration statement but only to
the same extent and with the same effect as the provisions pursuant to which the
Company has agreed to indemnify each of the Underwriters  contained in Section 7
of the Underwriting Agreement.

                  (e)  The  Holder(s)  of  the  Warrant  Securities  to be  sold
pursuant to a registration  statement,  and their successors and assigns,  shall
severally,  and not jointly,  indemnify the Company,  its officers and directors
and each person,  if any, who controls the Company within the meaning of Section
15 of the Act or Section  20(a) of the Exchange  Act,  against all loss,  claim,
damage,  expense or liability  (including  all expenses  reasonably  incurred in
investigating,  preparing or defending  against any claim  whatsoever)  to which
they may become  subject under the Act, the Exchange Act or  otherwise,  arising
from information  furnished by or on behalf of such Holders, or their successors
or assigns,  for specific  inclusion in such registration  statement to the same
extent and with the same effect as the provisions  contained in Section 7 of the
Underwriting  Agreement  pursuant  to which  the  Underwriters  have  agreed  to
indemnify the Company.


NY1-161299.2
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<PAGE>



                  (f) Nothing  contained in this Agreement shall be construed as
requiring the Holder(s) to exercise  their  Warrants prior to the initial filing
of any registration statement or the effectiveness thereof.

                  (g)  The  Company  shall  not  permit  the  inclusion  of  any
securities other than the Warrant  Securities to be included in any registration
statement filed pursuant to Section 7.3 hereof, or permit any other registration
statement to be or remain effective  during the  effectiveness of a registration
statement  filed  pursuant  to Section 7.3  hereof,  without  the prior  written
consent of the Holders of the Warrants  and Warrant  Securities  representing  a
Majority of such securities.

                  (h) The Company shall furnish to each Holder  participating in
the offering and to each underwriter, if any, a signed counterpart, addressed to
such Holder or underwriter,  of (i) an opinion of counsel to the Company,  dated
the effective date of such  registration  statement  (and, if such  registration
includes  an  underwritten  public  offering,  an opinion  dated the date of the
closing under the  underwriting  agreement),  and (ii) a "cold  comfort"  letter
dated  the  effective  date  of  such  registration   statement  (and,  if  such
registration  includes an underwritten public offering,  a letter dated the date
of the  closing  under the  underwriting  agreement)  signed by the  independent
public  accountants  who  have  issued  a  report  on  the  Company's  financial
statements  included  in such  registration  statement,  in each  case  covering
substantially the same matters with respect to such registration  statement (and
the prospectus  included therein) and, in the case of such accountants'  letter,
with respect to events subsequent to the date of such financial  statements,  as
are  customarily  covered in opinions of  issuer's  counsel and in  accountants'
letters   delivered  to  underwriters  in  underwritten   public   offerings  of
securities.


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                                     - 13 -

<PAGE>



                  (i)  The  Company  shall  as  soon as  practicable  after  the
effective date of the registration statement,  and in any event within 15 months
thereafter,  make  "generally  available  to its security  holders"  (within the
meaning  of Rule 158 under the Act) an  earnings  statement  (which  need not be
audited)  complying  with  Section  11(a) of the Act and covering a period of at
least  12  consecutive   months  beginning  after  the  effective  date  of  the
registration statement.

                  (j)  The  Company  shall  deliver   promptly  to  each  Holder
participating  in the  offering  requesting  the  correspondence  and  memoranda
described below and to the managing  underwriters,  copies of all correspondence
between  the  Commission  and the  Company,  its  counsel  or  auditors  and all
memoranda  relating to discussions with the Commission or its staff with respect
to the registration  statement and permit each Holder and underwriter to do such
investigation,  upon  reasonable  advance  notice,  with respect to  information
contained in or omitted from the  registration  statement as it deems reasonably
necessary to comply with  applicable  securities laws or rules of the NASD. Such
investigation  shall  include  access  to  books,  records  and  properties  and
opportunities  to discuss  the  business of the Company  with its  officers  and
independent auditors, all to such reasonable extent and at such reasonable times
and as often as any such Holder or underwriter shall reasonably request.

                  (k) The  Company  shall enter into an  underwriting  agreement
with the managing underwriters selected for such underwriting by Holders holding
a  Majority  of  the  Warrant  Securities  requested  to  be  included  in  such
underwriting,  which  may  be  the  Representative.   Such  agreement  shall  be
satisfactory in form and substance to the Company, each Holder and such managing
underwriter(s), and shall contain such representations, warranties and covenants
by the Company and such other terms as are  customarily  contained in agreements
of that type used by the managing  underwriter(s).  The Holders shall be parties
to any underwriting


NY1-161299.2
                                     - 14 -

<PAGE>



agreement  relating to an underwritten sale of their Warrant Securities and may,
at their option, require that any or all of the representations,  warranties and
covenants of the Company to or for the benefit of such underwriter(s) shall also
be made to and for the  benefit  of such  Holders.  Such  Holders  shall  not be
required to make any  representations  or warranties  to or agreements  with the
Company  or the  underwriter(s)  except as they may relate to such  Holders  and
their intended methods of distribution.

                  (l) In addition to the  Warrant  Securities,  upon the written
request therefor by any Holder(s), the Company shall include in the registration
statement any other  securities of the Company held by such  Holder(s) as of the
date of filing of such  registration  statement,  including  without  limitation
restricted  shares of Common Stock,  options,  warrants or any other  securities
convertible into shares of Common Stock.

                  (m) For purposes of this  Agreement,  the term  "Majority"  in
reference to the Holders of Warrants or Warrant Securities, shall mean in excess
of fifty percent (50%) of the then  outstanding  Warrants or Warrant  Securities
that (i) are not held by the Company, an affiliate,  officer, creditor, employee
or agent thereof or any of their respective affiliates, members of their family,
persons  acting as nominees or in  conjunction  therewith and (ii) have not been
resold  to the  public  pursuant  to a  registration  statement  filed  with the
Commission under the Act.

                  8.  Adjustments to Exercise Price and Number of Securities.
                 
                  Section 8.1 Subdivision and  Combination.  In case the Company
shall at any time subdivide or combine the  outstanding  shares of Common Stock,
the Exercise Price shall forthwith be  proportionately  decreased in the case of
subdivision or increased in the case of combination.


NY1-161299.2
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<PAGE>



                  Section 8.2 Stock  Dividends  and  Distributions.  In case the
Company  shall pay a dividend in, or make a  distribution  of,  shares of Common
Stock or of the Company's  capital  stock  convertible  into Common  Stock,  the
Exercise Price shall forthwith be proportionately  decreased. An adjustment made
pursuant to this Section 8.2 shall be made as of the record date for the subject
stock dividend or distribution.  

                  Section  8.3  Adjustment  in Number of  Securities.  Upon each
adjustment of the Exercise  Price  pursuant to the provisions of this Section 8,
the number of Warrant  Securities  issuable  upon the  exercise at the  adjusted
exercise  price of each Warrant  shall be adjusted to the nearest full amount by
multiplying a number equal to the Exercise Price in effect  immediately prior to
such  adjustment by the number of Warrant  Securities  issuable upon exercise of
the Warrants  immediately  prior to such  adjustment and dividing the product so
obtained by the adjusted Exercise Price.  

                  Section 8.4  Definition  of Common  Stock.  For the purpose of
this  Agreement,  the term  "Common  Stock"  shall  mean (i) the  class of stock
designated as Common Stock in the Certificate of Incorporation of the Company as
may be amended as of the date hereof, or (ii) any other class of stock resulting
from successive  changes or  reclassifications  of such Common Stock  consisting
solely of changes in par  value,  or from par value to no par value,  or from no
par  value  to par  value.  

                  Section   8.5  Merger  or   Consolidation.   In  case  of  any
consolidation  of the Company  with, or merger of the Company with, or merger of
the Company into,  another  corporation  (other than a  consolidation  or merger
which  does not  result in any  reclassification  or  change of the  outstanding
Common Stock),  the  corporation  formed by such  consolidation  or merger shall
execute and deliver to the Holder a  supplemental  warrant  agreement  providing
that the


NY1-161299.2
                                     - 16 -

<PAGE>



holder of each  Warrant then  outstanding  or to be  outstanding  shall have the
right  thereafter  (until the  expiration  of such  Warrant)  to  receive,  upon
exercise  of such  Warrant,  the kind and  amount  of  shares of stock and other
securities  and property  receivable  upon such  consolidation  or merger,  by a
holder of the number of  securities  of the Company for which such Warrant might
have been exercised  immediately prior to such  consolidation,  merger,  sale or
transfer.  Such  supplemental  warrant  agreement  shall provide for adjustments
which shall be  identical  to the  adjustments  provided in Section 8. The above
provision of this subsection shall similarly apply to successive  consolidations
or mergers.
                  
                  Section 8.6 No Adjustment of Exercise  Price in Certain Cases.
No adjustment of the Exercise Price shall be made: 

                           (a) Upon the  issuance or sale of the Warrants or the
                  Warrant Securities issuable upon the exercise of the Warrants;

                           (b) If the  amount of said  adjustment  shall be less
                  than two  cents  (2(cent))  per  Warrant  Security,  provided,
                  however, that in such case any adjustment that would otherwise
                  be required then to be made shall be carried forward and shall
                  be made at the time of and together  with the next  subsequent
                  adjustment  which,  together  with any  adjustment  so carried
                  forward,  shall  amount to at least two  cents  (2(cent))  per
                  Warrant Security.

                  9.  Exchange and  Replacement  of Warrant  Certificates.  Each
Warrant Certificate is exchangeable without expense,  upon the surrender thereof
by the registered Holder at the principal executive office of the Company, for a
new Warrant Certificate of like tenor and date representing in the aggregate the
right to purchase the same number of Warrant


NY1-161299.2
                                     - 17 -

<PAGE>



Securities in such denominations as shall be designated by the Holder thereof at
the time of such surrender.

                  Upon   receipt   by  the   Company  of   evidence   reasonably
satisfactory to it of the loss, theft,  destruction or mutilation of any Warrant
Certificate,  and,  in case of  loss,  theft or  destruction,  of  indemnity  or
security reasonably  satisfactory to it, and reimbursement to the Company of all
reasonable expenses  incidental thereto,  and upon surrender and cancellation of
the  Warrants,  if  mutilated,  the Company  will make and deliver a new Warrant
Certificate of like tenor, in lieu thereof.

                  10. Elimination of Fractional Interests. The Company shall not
be required to issue  certificates  representing  fractions  of shares of Common
Stock or Redeemable Warrants upon the exercise of the Warrants,  nor shall it be
required to issue scrip or pay cash in lieu of  fractional  interests,  it being
the intent of the parties that all fractional  interests  shall be eliminated by
rounding any  fraction up to the nearest  whole number of shares of Common Stock
or Redeemable Warrants or other securities, properties or rights.

                  11.  Reservation and Listing of Securities.  The Company shall
at all times reserve and keep available out of its  authorized  shares of Common
Stock,  solely for the purpose of issuance upon the exercise of the Warrants and
the  Redeemable  Warrants,  such  number  of  shares  of  Common  Stock or other
securities, properties or rights as shall be issuable upon the exercise thereof.
The Company covenants and agrees that, upon exercise of the Warrants and payment
of the Exercise Price therefor, all shares of Common Stock,  Redeemable Warrants
and other  securities  issuable  upon such  exercise  shall be duly and  validly
issued,  fully paid,  non-assessable and not subject to the preemptive rights of
any stockholder.  The Company further covenants and agrees that upon exercise of
the Redeemable Warrants


NY1-161299.2
                                     - 18 -

<PAGE>



underlying  the  Warrants  and  payment  of the  respective  Redeemable  Warrant
exercise  price  therefor,  all  shares  of Common  Stock  and other  securities
issuable  upon such  exercises  shall be duly and  validly  issued,  fully paid,
non-assessable  and not subject to the preemptive rights of any stockholder.  As
long as the  Warrants  shall be  outstanding,  the  Company  shall  use its best
efforts to cause all shares of Common  Stock  issuable  upon the exercise of the
Warrants and  Redeemable  Warrants and all  Redeemable  Warrants  underlying the
Warrants to be listed (subject to official notice of issuance) on all securities
exchanges on which the Common Stock or the Public  Warrants issued to the public
in connection herewith may then be listed and/or quoted on Nasdaq/NM or Nasdaq.

                  12.  Notices to Warrant  Holders.  Nothing  contained  in this
Agreement shall be construed as conferring upon the Holders the right to vote or
to consent or to receive  notice as a stockholder  in respect of any meetings of
stockholders for the election of directors or any other matter, or as having any
rights  whatsoever as a stockholder  of the Company.  If,  however,  at any time
prior to the expiration of the Warrants and their exercise, any of the following
events shall occur:
                           (a) the Company shall take a record of the holders of
                  its shares of Common Stock for the purpose of  entitling  them
                  to receive a dividend or distribution  payable  otherwise than
                  in cash, or a cash dividend or distribution  payable otherwise
                  than out of current or retained  earnings  or capital  surplus
                  (in  accordance  with  applicable  law),  as  indicated by the
                  accounting  treatment of such dividend or  distribution on the
                  books of the Company; or
                           (b) the Company shall offer to all the holders of its
                  Common  Stock any  additional  shares of capital  stock of the
                  Company or securities convertible into


NY1-161299.2
                                     - 19 -

<PAGE>



                  or  exchangeable for  shares of capital  stock of the Company,
                  or  any  option,   right  or  warrant  to  subscribe therefor;
                  or

                           (c) a  dissolution,  liquidation or winding up of the
                  Company  (other than in  connection  with a  consolidation  or
                  merger) or a sale of all or substantially all of its property,
                  assets and business as an entirety shall be proposed;

then, in any one or more of said events,  the Company shall give written  notice
of such event at least thirty (30) days prior to the date fixed as a record date
or the  date  of  closing  the  transfer  books  for  the  determination  of the
stockholders   entitled  to  such   dividend,   distribution,   convertible   or
exchangeable  securities  or  subscription  rights,  or entitled to vote on such
proposed dissolution, liquidation, winding up or sale. Such notice shall specify
such record date or the date of closing the transfer  books, as the case may be.
Failure to give such notice or any defect  therein shall not affect the validity
of any action taken in connection  with the  declaration  or payment of any such
dividend,  or the issuance of any  convertible or  exchangeable  securities,  or
subscription  rights,   options  or  warrants,   or  any  proposed  dissolution,
liquidation, winding up or sale.

                  13.      Redeemable Warrants.

                  The form of the certificate  representing  Redeemable Warrants
(and the form of election to purchase  shares of Common  Stock upon the exercise
of  Redeemable  Warrants  and the  form of  assignment  printed  on the  reverse
thereof)  shall be  substantially  as set forth in  Exhibit  "A" to the  Warrant
Agreement  dated  as of  the  date  hereof  by  and  between  the  Company,  and
Continental  Stock Transfer & Trust Company,  as warrant agent (the  "Redeemable
Warrant  Agreement").  Each  Redeemable  Warrant  issuable  upon exercise of the
Warrants  shall  evidence  the  right to  initially  purchase  a fully  paid and
non-assessable share of


NY1-161299.2
                                     - 20 -

<PAGE>



Common Stock at an initial  purchase price of $[___] [120% of the initial public
offering  price per share of Common Stock] from ______ 1997 [six months from the
effective date of the  Registration  Statement] until 5:30 p.m. New York time on
_________ 2001 [5 years from the effective date of the  Registration  Statement]
at which  time the  Redeemable  Warrants,  unless the  exercise  period has been
extended,  shall expire.  The exercise price of the Redeemable  Warrants and the
number of shares of Common Stock  issuable  upon the exercise of the  Redeemable
Warrants  are  subject  to  adjustment,  whether or not the  Warrants  have been
exercised and the Redeemable  Warrants have been issued,  in the manner and upon
the  occurrence of the events set forth in Section 8 of the  Redeemable  Warrant
Agreement,  which is hereby  incorporated  herein by  reference  and made a part
hereof as if set forth in its entirety herein. Subject to the provisions of this
Agreement and upon issuance of the Redeemable  Warrants underlying the Warrants,
each  registered  holder  of such  Redeemable  Warrant  shall  have the right to
purchase  from the  Company  (and the  Company  shall  issue to such  registered
holders)  up to the  number of fully  paid and  non-assessable  shares of Common
Stock (subject to adjustment as provided  herein and in the  Redeemable  Warrant
Agreement),  free and clear of all preemptive  rights of stockholders,  provided
that such registered  holder  complies with the terms governing  exercise of the
Redeemable Warrant set forth in the Redeemable  Warrant Agreement,  and pays the
applicable  exercise  price,  determined  in  accordance  with the  terms of the
Redeemable  Warrant  Agreement.  Upon exercise of the Redeemable  Warrants,  the
Company shall  forthwith  issue to the registered  holder of any such Redeemable
Warrant in his name or in such name as may be directed by him,  certificates for
the number of shares of Common Stock so purchased.  Except as otherwise provided
in this  Agreement,  the  Redeemable  Warrants  underlying the Warrants shall be
governed in all respects by the terms


NY1-161299.2
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<PAGE>



of  the  Redeemable  Warrant  Agreement.   The  Redeemable   Warrants  shall  be
transferable in the manner  provided in the Redeemable  Warrant  Agreement,  and
upon any such transfer,  a new Redeemable  Warrant  Certificate  shall be issued
promptly to the  transferee.  The Company  covenants  to, and agrees  with,  the
Holder(s) that without the prior written  consent of the  Holder(s),  which will
not be  unreasonably  withheld,  the  Redeemable  Warrant  Agreement will not be
modified,  amended,  canceled,  altered or superseded, and that the Company will
send to each  Holder,  irrespective  of  whether or not the  Warrants  have been
exercised,  any and all notices required by the Redeemable  Warrant Agreement to
be sent to holders of Redeemable Warrants.

                  14.      Notices.

                  All  notices,  requests,  consents  and  other  communications
hereunder  shall be in  writing  and  shall be deemed to have been duly made and
sent when delivered,  or mailed by registered or certified mail,  return receipt
requested:

                           (a) If to the registered  Holder of the Warrants,  to
                  the  address  of such  Holder  as  shown  on the  books of the
                  Company; or

                           (b) If to the  Company,  to the  address set forth in
                  Section 3 hereof or to such other  address as the  Company may
                  designate by notice to the Holders.
             
                  15.   Supplements   and   Amendments.   The  Company  and  the
Representative  may from time to time supplement or amend this Agreement without
the   approval  of  any  Holders  of  Warrant   Certificates   (other  than  the
Representative)  in order to cure any  ambiguity,  to correct or supplement  any
provision  contained  herein  which may be defective  or  inconsistent  with any
provisions  herein,  or to make any other  provisions  in regard to  matters  or
questions  arising hereunder which the Company and the  Representative  may deem
necessary or desirable


NY1-161299.2
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<PAGE>



and which the Company and the Representative deem shall not adversely affect the
interests of the Holders of Warrant Certificates.

                  16.  Successors.  All the  covenants  and  provisions  of this
Agreement  shall be binding  upon and inure to the benefit of the  Company,  the
Holders and their respective successors and assigns hereunder.

                  17.  Termination.  This Agreement shall terminate at the close
of business on _______, 2003. Notwithstanding the foregoing, the indemnification
provisions  of  Section  7 shall  survive  such  termination  until the close of
business on _______, 2009.

                  18. Governing Law; Submission to Jurisdiction.  This Agreement
and each Warrant  Certificate  issued hereunder shall be deemed to be a contract
made  under  the laws of the  State of New  York and for all  purposes  shall be
construed in accordance with the laws of said State without giving effect to the
rules of said State governing the conflicts of laws.

                  The Company,  the  Representative and the Holders hereby agree
that any action,  proceeding  or claim against it arising out of, or relating in
any way to, this  Agreement  shall be brought and  enforced in the courts of the
State of New York or of the United  States of America for the Southern  District
of New York, and irrevocably  submits to such  jurisdiction,  which jurisdiction
shall be  exclusive.  The Company,  the  Representative  and the Holders  hereby
irrevocably  waive any objection to such exclusive  jurisdiction or inconvenient
forum.  Any such  process or summons to be served upon any of the  Company,  the
Representative and the Holders (at the option of the party bringing such action,
proceeding or claim) may be served by transmitting a copy thereof, by registered
or certified mail, return receipt requested, postage prepaid, addressed to it at
the  address  set forth in  Section  14  hereof.  Such  mailing  shall be deemed
personal service and shall be legal and binding upon the party so served in any


NY1-161299.2
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<PAGE>



action,  proceeding or claim. The Company,  the  Representative  and the Holders
agree that the prevailing  party(ies) in any such action or proceeding  shall be
entitled to recover from the other party(ies) all of its/their  reasonable legal
costs and  expenses  relating to such action or  proceeding  and/or  incurred in
connection with the preparation therefor.

                  19. Entire Agreement;  Modification. This Agreement (including
the Underwriting  Agreement and the Redeemable  Warrant  Agreement to the extent
portions  thereof are  referred  to herein)  contains  the entire  understanding
between the parties hereto with respect to the subject matter hereof and may not
be modified or amended except by a writing duly signed by the party against whom
enforcement of the modification or amendment is sought.

                  20. Severability.  If any provision of this Agreement shall be
held to be invalid or unenforceable,  such invalidity or unenforceability  shall
not affect any other provision of this Agreement.

                  21.  Captions.  The caption  headings of the  Sections of this
Agreement are for convenience of reference only and are not intended, nor should
they be construed as, a part of this Agreement and shall be given no substantive
effect.

                  22.  Benefits  of this  Agreement.  Nothing in this  Agreement
shall be construed to give to any person or  corporation  other than the Company
and the  Representative  and  any  other  registered  Holder(s)  of the  Warrant
Certificates or Warrant Securities any legal or equitable right, remedy or claim
under this  Agreement;  and this Agreement  shall be for the sole benefit of the
Company  and the  Representative  and any other  registered  Holders  of Warrant
Certificates or Warrant Securities.


NY1-161299.2
                                     - 24 -

<PAGE>



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



NY1-161299.2
                                     - 25 -

<PAGE>



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

                                                MULTIMEDIA ACCESS CORPORATION



                                                By:
                                                   -----------------------------
                                                   Glenn A. Norem
                                                   Chief Executive Officer

Attest:


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



                                                NATIONAL SECURITIES CORPORATION



                                                By:
                                                   -----------------------------
                                                   Steven A. Rothstein
                                                   Chairman




<PAGE>

                                                                       EXHIBIT A



                          [FORM OF WARRANT CERTIFICATE]

THE WARRANTS  REPRESENTED BY THIS CERTIFICATE AND THE OTHER SECURITIES  ISSUABLE
UPON  EXERCISE  THEREOF  MAY NOT BE OFFERED OR SOLD  EXCEPT  PURSUANT  TO (i) AN
EFFECTIVE  REGISTRATION  STATEMENT UNDER THE SECURITIES ACT OF 1933, (ii) TO THE
EXTENT  APPLICABLE,  RULE 144 UNDER SUCH ACT (OR ANY SIMILAR RULE UNDER SUCH ACT
RELATING TO THE DISPOSITION OF SECURITIES),  OR (iii) AN OPINION OF COUNSEL,  IF
SUCH OPINION SHALL BE REASONABLY SATISFACTORY TO COUNSEL FOR THE ISSUER, THAT AN
EXEMPTION FROM REGISTRATION UNDER SUCH ACT IS AVAILABLE.

THE TRANSFER OR EXCHANGE OF THE WARRANTS REPRESENTED BY THIS
CERTIFICATE IS RESTRICTED IN ACCORDANCE WITH THE WARRANT
AGREEMENT REFERRED TO HEREIN.

                            EXERCISABLE ON OR BEFORE
                   5:30 P.M., NEW YORK TIME, __________, 2001

No. W-                                                       Warrants to Purchas
                                              ____ Shares of Common Stock and/or
                                                        ____ Redeemable Warrants





                               WARRANT CERTIFICATE

                This Warrant Certificate certifies that , or registered assigns,
is the  registered  holder of Warrants to purchase  initially,  at any time from
__________,  1997  [one  year  from  the  effective  date  of  the  Registration
Statement]  until 5:30 p.m. New York time on ___________,  2001 [five years from
the effective date of the Registration  Statement]  ("Expiration  Date"),  up to
__________  fully-paid  and  non-assessable  shares of common stock,  $.0001 par
value ("Common Stock"), of MULTIMEDIA ACCESS CORPORATION, a Delaware corporation
(the "Company"), and/or _____ Redeemable Warrants of the Company (one Redeemable
Warrant entitling the owner to purchase one fully-paid and non-assessable  share
of Common Stock) at the initial exercise price, subject to adjustment in certain
events (the "Exercise  Price"),  of $[____] [120% of the initial public offering
price]  per  share of Common  Stock  and  $[____]  [120% of the  initial  public
offering   price]  per  Redeemable   Warrant  upon  surrender  of  this  Warrant
Certificate  and  payment  of the  Exercise  Price at an office or agency of the
Company,   but  subject  to  the   conditions   set  forth  herein  and  in  the
Representative's Warrant Agreement dated as of _______, 1996 between the Company
and


NY1-161299.2
                                       A-1

<PAGE>



NATIONAL  SECURITIES  CORPORATION  (the  "Warrant  Agreement").  Payment  of the
Exercise  Price shall be made by  certified  or official  bank check in New York
Clearing House funds payable to the order of the Company or by surrender of this
Warrant Certificate.

                No Warrant may be exercised  after 5:30 p.m.,  New York time, on
the  Expiration  Date,  at which  time all  Warrants  evidenced  hereby,  unless
exercised prior thereto, shall thereafter be void.

                The Warrants evidenced by this Warrant Certificate are part of a
duly  authorized  issue of Warrants  issued  pursuant to the Warrant  Agreement,
which Warrant  Agreement is hereby  incorporated by reference in and made a part
of this  instrument  and is hereby  referred to for a description of the rights,
limitation  of rights,  obligations,  duties and  immunities  thereunder  of the
Company and the holders (the words "holders" or "holder"  meaning the registered
holders or registered holder) of the Warrants.

                The  Warrant  Agreement  provides  that upon the  occurrence  of
certain  events the Exercise  Price and the type and/or  number of the Company's
securities issuable thereupon may, subject to certain  conditions,  be adjusted.
In such event,  the  Company  will,  at the  request of the holder,  issue a new
Warrant  Certificate  evidencing  the  adjustment in the Exercise  Price and the
number  and/or type of  securities  issuable  upon the exercise of the Warrants;
provided,  however,  that the  failure of the  Company to issue such new Warrant
Certificates shall not in any way change, alter, or otherwise impair, the rights
of the holder as set forth in the Warrant Agreement.

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

                Upon the exercise of less than all of the Warrants  evidenced by
this  Certificate,  the Company shall forthwith issue to the holder hereof a new
Warrant Certificate representing such number of unexercised Warrants.

                The Company may deem and treat the registered  holder(s)  hereof
as the  absolute  owner(s)  of this  Warrant  Certificate  (notwithstanding  any
notation of ownership or other writing  hereon made by anyone),  for the purpose
of any exercise hereof, and of any distribution to the holder(s) hereof, and for
all other  purposes,  and the Company shall not be affected by any notice to the
contrary.

                All terms used in this Warrant  Certificate which are defined in
the Warrant  Agreement  shall have the meanings  assigned to them in the Warrant
Agreement.



NY1-161299.2
                                       A-2

<PAGE>



                IN  WITNESS  WHEREOF,   the  Company  has  caused  this  Warrant
Certificate to be duly executed under its corporate seal.

Dated as of ___________, 1996

                                                MULTIMEDIA ACCESS CORPORATION



                                                By:
                                                    ----------------------------
                                                    Glenn A. Norem
                                                    Chief Executive Officer





<PAGE>




             [FORM OF ELECTION TO PURCHASE PURSUANT TO SECTION 3.1]

                The undersigned hereby irrevocably elects to exercise the right,
represented by this Warrant Certificate, to purchase:


|_|                                   shares of Common Stock;
    --------------------------


|_|   
    --------------------------        Redeemable Warrants;

|_|                                   shares of Common Stock together with
    --------------------------        an equal number of Redeemable Warrants; or

|_|                                   shares of Common Stock together with
    --------------------------        Redeemable Warrants.


and herewith tenders in payment for such securities a certified or official bank
check payable in New York Clearing House funds to the order of Multimedia Access
Corporation in the amount of  $_______________________,  all in accordance  with
the terms of Section 3.1 of the  Representative's  Warrant Agreement dated as of
______________________,  1996 between Multimedia Access Corporation and National
Securities  Corporation.  The  undersigned  requests that a certificate for such
securities  be  registered  in the  name  of  whose  address  is and  that  such
Certificate be delivered to_____________________________________________________
___________________whose address is__________________________________________.


Dated:
                              Signature
                                        ----------------------------------------
                              (Signature must conform in all respects to name of
                              holder as  specified on the face of   the  Warrant
                              Certificate.)


                              --------------------------------------------------
                              (Insert Social Security or Other Identifying
                              Number of Holder)





NY1-161299.2
                                       A-4

<PAGE>



              [FORM OF ELECTION TO PURCHASE PURSUANT TO SECTION 3.2]

     The  undersigned   hereby   irrevocably   elects  to  exercise  the  right,
represented by this Warrant Certificate, to purchase:


|_|                         shares of Common Stock;
    ----------------------

|_|                         Redeemable Warrants;
    ----------------------

|_|                         shares of Common Stock together with an equal number
    ----------------------  of Redeemable Warrants; or

|_|                         shares of Common Stock together with
    ----------------------  Redeemable Warrants.
    ----------------------  
    

and herewith  tenders in payment for such  securities  ________  Warrants all in
accordance  with  the  terms  of  Section  3.2 of the  Representative's  Warrant
Agreement  dated  as  of  __________________,  1996  between  Multimedia  Access
Corporation and National Securities Corporation. The undersigned requests that a
certificate for such securities be registered in the name of whose address is __
___________________________ and that such Certificate be delivered to __________
_____________________________whose address is _________________________________.


Dated:
                          Signature
                                    --------------------------------------------
                          (Signature must conform in all  respects  to  name  of
                          holder as  specified on the face   of   the    Warrant
                          Certificate.)


                          ------------------------------------------------------
                          (Insert Social Security or Other Identifying
                          Number of Holder)




NY1-161299.2
                                       A-5

<PAGE>



                              [FORM OF ASSIGNMENT]



             (To be executed by the registered holder if such holder
                  desires to transfer the Warrant Certificate.)


         FOR VALUE RECEIVED ___________________________hereby sells, assigns and
transfers unto

________________________________________________________________________________


                  (Please print name and address of transferee)

this Warrant  Certificate,  together with all right, title and interest therein,
and does hereby  irrevocably  constitute and appoint  Attorney,  to transfer the
within Warrant Certificate on the books of the within-named  Company,  with full
power of substitution.



Dated:                   Signature:
      ----------------              --------------------------------------------
                         (Signature  must conform in all  respects  to  name  of
                         holder as  specified on the face    of   the    Warrant
                         Certificate.)



                         -------------------------------------------------------
                         (Insert Social Security or Other Identifying
                         Number of Assignee)



NY1-161299.2
                                       A-6



                               November 13, 1996



Securities and Exchange Commission
450 Fifth Street, N.W.
Washington, D.C.  20549

Re:  MULTIMEDIA ACCESS CORPORATION
     REGISTRATION STATEMENT

Dear Sir/Madam:

     We are corporate and securities  counsel to Multimedia  Access  Corporation
(the "Company"), a Delaware corporation,  in connection with the registration on
Form SB-2 of  2,547,244  shares  of the  Company's  Common  Stock  (the  "Common
Stock"),  2,547,244  Redeemable Common  Stock  Purchase  Warrants  (the  "Public
Warrants"), the 2,547,244 shares of Common Stock underlying the Public Warrants.

     We hereby  advise that,  in our opinion,  the shares of Common  Stock,  the
Public  Warrants and the shares of Common Stock  underlying the Public  Warrants
have been duly authorized by all necessary corporate acts of the Company, and
when  issued,  delivered  and  paid  for by  the  Underwriter,  pursuant  to the
Underwriting  Agreement,  will be legally and  validly  issued,  fully-paid  and
non-assessable.

     We consent to the use of our firm's name under the heading "Legal  Matters"
in the  Registration  Statement,  and any  amendments  thereto,  filed  with the
Securities  and Exchange  Commission  in  connection  with the  above-referenced
offering.

                                                  Very truly yours,



                                                  /s/  John S. Stoppleman
                                                  John S. Stoppleman








                                                                   EXHIBIT 10(U)

                                 PROMISSORY NOTE

$500,000.00                                                  September 5, 1996

   FOR VALUE RECEIVED,  the undersigned MultiMedia Access Corporation ("Maker"),
a  Delaware  corporation,  promises  to pay to the  order of  Robert  Rubin,  an
individual,  (with his successors and assigns referred to herein as "Payee"), at
the registered  office of Maker in Delaware,  or at such other place in Delaware
as Payee may from time to time  designate,  in lawful money of the United States
of America,  the  principal  sum of Five  Hundred  Thousand  and No/100  Dollars
($500,000.00),  and any other  amounts that may be  outstanding  pursuant to the
terms of this Unsecured  Promissory Note (the "Note")  together with interest on
the  unpaid  principal  balance  hereof  from  time to time  outstanding,  until
maturity, at the lesser of (i) eight percent (8%) per annum, or (ii) the Highest
Lawful Rate (as hereinafter defined). Any payments of principal or interest that
become past due shall bear  interest at the lesser of (i) fifteen  percent (15%)
per annum,  or (ii) the  Highest  Lawful  Rate.  Interest  on this Note shall be
computed on the basis of the number of actual days elapsed in a year  consisting
of 365 days.

     1. Payments.  All principal and interest shall be due and payable on demand
ten (10) days subsequent the initial public  offering of the Maker's  securities
("IPO") or after 180 days from the date first written above.

     2.  Prepayments.  Maker shall have the right to repay, in whole or in part,
the  principal  of  this  Note at any  time  without  premium  or  penalty.  Any
prepayment  will first be applied to any accrued  interest,  and  thereafter  to
principal.

     3. Time of Essence.  Time is of the essence  with respect to all of Maker's
obligations and agreements under this Note.

     4. Events of Default and  Remedies.  If maker does not pay any  interest or
principal  when due under this Note,  whether on the  scheduled  payment date or
otherwise,  Payee or other holder of this Note may demand the unpaid  balance of
and accrued interest on this Note.

     5. No Waiver. No delay on the part of Payee or other holder of this Note in
the  exercise of any power or right under this Note,  shall  operate as a waiver
hereof,  nor shall a single or partial  exercise of any power or right  preclude
other or further  exercise  thereof or the exercise of any other power or right.
Enforcement  by the  holder  of this  Note  for the  payment  hereof  shall  not
constitute an election by such holder of remedies so as to preclude the exercise
of any other remedy available to such holder.

   6. Waiver.  Except as otherwise  set forth herein,  Maker and all  endorsers,
sureties, and guarantors hereof hereby jointly and severally waive all exemption
rights under any applicable law, and also waive presentment for payment, demand,
notice of nonpayment, valuation, appraisement, protest, demand, dishonor, notice
of protest,  notice of intent to  accelerate,  notice of  acceleration,  and all
other  notices,   and  without   further  notice  hereby  consent  to  renewals,
extensions, or partial payments either before or after maturity.

   7. Cost of  Collection.  If this Note is placed in the hands of any  attorney
for  collection,  or is  collected  by suit or  through  probate  or  bankruptcy
proceeding,  Maker agrees to pay reasonable attorneys' fees and disbursements in
addition to other amounts due.

     8.  Severability.   The  invalidity,   or  unenforceability  in  particular
circumstances,  of any  provision  of this Note  shall not  extend  beyond  such
provision  or such  circumstances  and no other  provision of this Note shall be
affected thereby.

   9. Highest  Lawful  Rate.  It is  expressly  stipulated  and agreed to be the
intent of Maker and Payee at all times to comply with the  applicable  state law
governing  the maximum  rate or amount of interest  payable on or in  connection
with this Note (or  applicable  United States  federal law to the extent that it
permits Payee to contract for, charge, take, reserve or receive a greater amount
of interest  than under  applicable  state law). If the  applicable  law is ever
judicially interpreted so as to render usurious any


<PAGE>

amount called for under this Note or under any of the other documents evidencing
or relating to this Note or any part thereof  (collectively,  the "Agreements"),
or  contracted  for,  charged,  taken,  reserved or received with respect to the
indebtedness  evidenced  by this Note  which  results in Maker  having  paid any
interest  in excess of that  permitted  by law,  then it is Maker's  and Payee's
express  intent  that  all  excess  amounts  theretofore  collected  by Payee be
credited  on the  principal  balance of this Note (or,  if this Note has been or
would be thereby paid in full,  refunded to Maker),  and the  provisions of this
Note and the other  Agreements  immediately  be deemed  reformed and the amounts
thereafter  collectible hereunder and thereunder reduced,  without the necessity
of the  execution  of any new  document,  so as to permit  the  recovery  of the
fullest  amount  called for  hereunder and  thereunder,  while  complying in all
respects with the applicable law. The right to accelerate  maturity of this Note
does not include the right to  accelerate  any interest  which has not otherwise
accrued on the date of such  acceleration,  and Payee does not intend to collect
any unearned  interest in the event of acceleration.  All sums paid or agreed to
be paid to Payee for the use, forbearance or detention of the Loan shall, to the
extent permitted by applicable law, be amortized, prorated, allocated and spread
throughout  the full term of the Loan until  payment in full so that the rate or
amount of interest on account of the Loan does not exceed the  applicable  usury
ceiling.  Notwithstanding  any provision contained in this Note or in any of the
other  Agreements  that permits the compounding of interest,  including  without
limitation  any  provision by which any of the accrued  interest is added to the
principal  amount of this  Note,  the total  amount of  interest  that  Maker is
obligated  to pay and Payee is  entitled  to receive  with  respect to this Note
shall  not  exceed  the  amount  calculated  on a simple  (i.e.,  noncompounded)
interest basis at the Highest Lawful Rate on principal amounts actually advanced
to or for the account of Maker,  including the initial  principal amount of this
Note and any advances  made pursuant to any of the  Agreements  (such as for the
payment of taxes, insurance premiums and the like).

     10. Business  Purposes.  Maker hereby represents and warrants to the holder
of this Note that the loan evidenced hereby is a "contract under which credit is
extended for business,  commercial investment, or other similar purpose," and is
not a loan for "personal, family, household, or agricultural use."

   11.  Warrant  Coverage.  Upon  receipt of the proceeds of this Note by Maker,
Payee will  receive  from Glenn  Norem,  personally,  a transfer of a warrant or
warrants to purchase a total of 50,000 shares of MultiMedia  Access  Corporation
common stock.  The exercise price of said warrant(s) will be priced at $3.00 per
share and the  warrant(s)  will expire three years after their  original date of
issue.

   12. Notices.  All notices or demands required or permitted hereunder shall be
in writing and shall be deemed  given when  actually  delivered  or on the third
business  day  following  the day on which the same  shall  have been  mailed by
registered or certified mail, postage prepaid, addressed as follows:

   If to Maker:   MultiMedia Access Corporation
                    Two Metro Square
                    2665 Villa Creed Drive
                    Suite 200
                    Dallas, TX 75234
                    Attn: William S. Leftwich

   If to Payee:   Robert Rubin
                    6060 Kings Gate Circle
                    Delray Beach, FL 33484

   Either  Maker or Payee may change its  respective  address  or  addressee  by
giving notice of such change to the other party in the manner  provided  herein.
For this  purpose  only,  unless  and until  such  written  notice  is  actually
received,  the address and addressee specified for each party shall be deemed to
continue on effect for all purposes.

     13.  GOVERNING  LAW.  This Note shall be construed in  accordance  with and
governed by the laws of the State of Texas.


<PAGE>

     14.  Headings.  The  headings of the sections of this Note are inserted for
convenience only and shall not be deemed to constitute a part thereof.

   IN WITNESS WHEREOF, the undersigned has executed this Note to be effective as
of the date first written above.

                                        MAKER:

                                        MultiMedia Access Corporation, a
                                        Delaware Corporation




                                        By: /s/ William S. Leftwich
                                            ----------------------------
                                             William S. Leftwich
                                             Chief Financial Officer


PROMISSORY NOTE

$100,000.00                                                   November 15, 1996

     FOR  VALUE  RECEIVED,   the  undersigned   MultiMedia  Access   Corporation
("Maker"),  a Delaware  corporation,  promises to pay to the order of M. Douglas
Adkins,  an individual,  (with his successors and assigns  referred to herein as
"Payee"),  at the registered office of Maker in Delaware, or at such other place
in Delaware  as Payee may from time to time  designate,  in lawful  money of the
United States of America,  the principal sum of One Hundred  Thousand and No/100
Dollars ($100,000.00), and any other amounts that may be outstanding pursuant to
the terms of this Unsecured  Promissory Note (the "Note") together with interest
on the unpaid  principal  balance  hereof from time to time  outstanding,  until
maturity, at the lesser of (i) eight percent (8%) per annum, or (ii) the Highest
Lawful Rate (as hereinafter defined). Any payments of principal or interest that
become past due shall bear  interest at the lesser of (i) fifteen  percent (15%)
per annum,  or (ii) the  Highest  Lawful  Rate.  Interest  on this Note shall be
computed on the basis of the number of actual days elapsed in a year  consisting
of 365 days.

     1. Payments.  All principal and interest shall be due and payable on demand
ten (10) days subsequent the initial public  offering of the Maker's  securities
("IPO") or after 180 days from the date first written above.

     2.  Prepayments.  Maker shall have the right to repay, in whole or in part,
the  principal  of  this  Note at any  time  without  premium  or  penalty.  Any
prepayment  will first be applied to any accrued  interest,  and  thereafter  to
principal.

     3. Time of Essence.  Time is of the essence  with respect to all of Maker's
obligations and agreements under this Note.

     4. Events of Default and  Remedies.  If maker does not pay any  interest or
principal  when due under this Note,  whether on the  scheduled  payment date or
otherwise,  Payee or other holder of this Note may demand the unpaid  balance of
and accrued interest on this Note.

     5. No Waiver. No delay on the part of Payee or other holder of this Note in
the  exercise of any power or right under this Note,  shall  operate as a waiver
hereof,  nor shall a single or partial  exercise of any power or right  preclude
other or further  exercise  thereof or the exercise of any other power or right.
Enforcement  by the  holder  of this  Note  for the  payment  hereof  shall  not
constitute an election by such holder of remedies so as to preclude the exercise
of any other remedy available to such holder.

     6. Waiver.  Except as otherwise set forth herein,  Maker and all endorsers,
sureties, and guarantors hereof hereby jointly and severally waive all exemption
rights under any applicable law, and also waive presentment for payment, demand,
notice of nonpayment, valuation, appraisement, protest, demand, dishonor, notice
of protest,  notice of intent to  accelerate,  notice of  acceleration,  and all
other  notices,   and  without   further  notice  hereby  consent  to  renewals,
extensions, or partial payments either before or after maturity.



<PAGE>



     7. Cost of Collection.  If this Note is placed in the hands of any attorney
for  collection,  or is  collected  by suit or  through  probate  or  bankruptcy
proceeding,  Maker agrees to pay reasonable attorneys' fees and disbursements in
addition to other amounts due.

     8.  Severability.   The  invalidity,   or  unenforceability  in  particular
circumstances,  of any  provision  of this Note  shall not  extend  beyond  such
provision  or such  circumstances  and no other  provision of this Note shall be
affected thereby.

         9. Highest Lawful Rate. It is expressly stipulated and agreed to be the
intent of Maker and Payee at all times to comply with the  applicable  state law
governing  the maximum  rate or amount of interest  payable on or in  connection
with this Note (or  applicable  United States  federal law to the extent that it
permits Payee to contract for, charge, take, reserve or receive a greater amount
of interest  than under  applicable  state law). If the  applicable  law is ever
judicially interpreted so as to render usurious any amount called for under this
Note or under any of the other documents  evidencing or relating to this Note or
any part thereof (collectively,  the "Agreements"),  or contracted for, charged,
taken,  reserved or received with respect to the indebtedness  evidenced by this
Note which results in Maker having paid any interest in excess of that permitted
by law, then it is Maker's and Payee's  express  intent that all excess  amounts
theretofore collected by Payee be credited on the principal balance of this Note
(or, if this Note has been or would be thereby paid in full, refunded to Maker),
and the provisions of this Note and the other  Agreements  immediately be deemed
reformed  and  the  amounts  thereafter  collectible  hereunder  and  thereunder
reduced,  without the necessity of the  execution of any new document,  so as to
permit the recovery of the fullest  amount called for hereunder and  thereunder,
while complying in all respects with the applicable law. The right to accelerate
maturity  of this Note does not  include the right to  accelerate  any  interest
which has not otherwise accrued on the date of such acceleration, and Payee does
not intend to collect any unearned  interest in the event of  acceleration.  All
sums paid or agreed to be paid to Payee for the use, forbearance or detention of
the Loan  shall,  to the extent  permitted  by  applicable  law,  be  amortized,
prorated,  allocated  and  spread  throughout  the full  term of the Loan  until
payment  in full so that the rate or amount of  interest  on account of the Loan
does not exceed the  applicable  usury  ceiling.  Notwithstanding  any provision
contained  in this  Note or in any of the  other  Agreements  that  permits  the
compounding of interest, including without limitation any provision by which any
of the accrued interest is added to the principal amount of this Note, the total
amount of  interest  that Maker is  obligated  to pay and Payee is  entitled  to
receive  with respect to this Note shall not exceed the amount  calculated  on a
simple  (i.e.,  noncompounded)  interest  basis at the  Highest  Lawful  Rate on
principal  amounts actually  advanced to or for the account of Maker,  including
the initial  principal amount of this Note and any advances made pursuant to any
of the Agreements (such as for the payment of taxes,  insurance premiums and the
like).

     10. Business  Purposes.  Maker hereby represents and warrants to the holder
of this Note that the loan evidenced hereby is a "contract under which credit is
extended for business,  commercial investment, or other similar purpose," and is
not a loan for "personal, family, household, or agricultural use."




<PAGE>


         11.  Warrant  Coverage.  Upon  receipt of the  proceeds of this Note by
Maker, Payee will receive from Glenn Norem,  personally, a transfer of a warrant
or  warrants  to  purchase  a  total  of  10,000  shares  of  MultiMedia  Access
Corporation  common stock.  The exercise price of said warrant(s) will be priced
at $3.00 per share and the warrant(s) will expire November 15, 1999.

         12.  Notices.  All notices or demands  required or permitted  hereunder
shall be in writing and shall be deemed given when actually  delivered or on the
third business day following the day on which the same shall have been mailed by
registered or certified mail, postage prepaid, addressed as follows:

         If to Maker:               MultiMedia Access Corporation
                                    Two Metro Square
                                    2665 Villa Creed Drive
                                    Suite 200
                                    Dallas, TX  75234
                                    Attn: William S. Leftwich

         If to Payee:               M. Douglas Adkins
                                    Gardere & Wynne, LLP
                                    3000 Thanksgiving Tower
                                    1601 Elm Street
                                    Dallas, TX  75201

         Either Maker or Payee may change its respective address or addressee by
giving notice of such change to the other party in the manner  provided  herein.
For this  purpose  only,  unless  and until  such  written  notice  is  actually
received,  the address and addressee specified for each party shall be deemed to
continue on effect for all purposes.

     13.  GOVERNING  LAW.  This Note shall be construed in  accordance  with and
governed by the laws of the State of Texas.

     14.  Headings.  The  headings of the sections of this Note are inserted for
convenience only and shall not be deemed to constitute a part thereof.

         IN  WITNESS  WHEREOF,  the  undersigned  has  executed  this Note to be
effective as of the date first written above.

                                      MAKER:

                                      MultiMedia Access Corporation, a
                                      Delaware Corporation



                                      By: /s/ William S. Leftwich
                                          -----------------------------
                                          William S. Leftwich
                                          Chief Financial Officer



                                 PROMISSORY NOTE

$200,000.00                                                    November 15, 1996

         FOR VALUE  RECEIVED,  the  undersigned  MultiMedia  Access  Corporation
("Maker"),  a  Delaware  corporation,  promises  to  pay to the  order  of  H.T.
Ardinger, an individual,  (with his successors and assigns referred to herein as
"Payee"),  at the registered office of Maker in Delaware, or at such other place
in Delaware  as Payee may from time to time  designate,  in lawful  money of the
United States of America,  the principal sum of Two Hundred  Thousand and No/100
Dollars ($200,000.00), and any other amounts that may be outstanding pursuant to
the terms of this Unsecured  Promissory Note (the "Note") together with interest
on the unpaid  principal  balance  hereof from time to time  outstanding,  until
maturity, at the lesser of (i) eight percent (8%) per annum, or (ii) the Highest
Lawful Rate (as hereinafter defined). Any payments of principal or interest that
become past due shall bear  interest at the lesser of (i) fifteen  percent (15%)
per annum,  or (ii) the  Highest  Lawful  Rate.  Interest  on this Note shall be
computed on the basis of the number of actual days elapsed in a year  consisting
of 365 days.

         1.  Payments.  All principal  and interest  shall be due and payable on
demand ten (10) days  subsequent  the  initial  public  offering  of the Maker's
securities ("IPO") or after 180 days from the date first written above.

         2.  Prepayments.  Maker  shall have the right to repay,  in whole or in
part,  the  principal of this Note at any time without  premium or penalty.  Any
prepayment  will first be applied to any accrued  interest,  and  thereafter  to
principal.

         3. Time of  Essence.  Time is of the  essence  with  respect  to all of
Maker's obligations and agreements under this Note.

         4. Events of Default and  Remedies.  If maker does not pay any interest
or principal when due under this Note,  whether on the scheduled payment date or
otherwise,  Payee or other holder of this Note may demand the unpaid  balance of
and accrued interest on this Note.

         5. No  Waiver.  No delay on the part of Payee or other  holder  of this
Note in the exercise of any power or right under this Note,  shall  operate as a
waiver  hereof,  nor shall a single or  partial  exercise  of any power or right
preclude other or further exercise thereof or the exercise of any other power or
right.  Enforcement  by the holder of this Note for the payment hereof shall not
constitute an election by such holder of remedies so as to preclude the exercise
of any other remedy available to such holder.

         6.  Waiver.  Except  as  otherwise  set  forth  herein,  Maker  and all
endorsers,  sureties,  and guarantors  hereof hereby jointly and severally waive
all exemption  rights under any applicable  law, and also waive  presentment for
payment, demand, notice of nonpayment, valuation, appraisement, protest, demand,
dishonor,  notice  of  protest,  notice  of  intent  to  accelerate,  notice  of
acceleration,  and all other notices,  and without further notice hereby consent
to renewals, extensions, or partial payments either before or after maturity.



<PAGE>



         7.  Cost of  Collection.  If this  Note is  placed  in the hands of any
attorney  for  collection,  or is  collected  by  suit  or  through  probate  or
bankruptcy  proceeding,  Maker  agrees  to pay  reasonable  attorneys'  fees and
disbursements in addition to other amounts due.

         8.  Severability.  The invalidity,  or  unenforceability  in particular
circumstances,  of any  provision  of this Note  shall not  extend  beyond  such
provision  or such  circumstances  and no other  provision of this Note shall be
affected thereby.

         9. Highest Lawful Rate. It is expressly stipulated and agreed to be the
intent of Maker and Payee at all times to comply with the  applicable  state law
governing  the maximum  rate or amount of interest  payable on or in  connection
with this Note (or  applicable  United States  federal law to the extent that it
permits Payee to contract for, charge, take, reserve or receive a greater amount
of interest  than under  applicable  state law). If the  applicable  law is ever
judicially interpreted so as to render usurious any amount called for under this
Note or under any of the other documents  evidencing or relating to this Note or
any part thereof (collectively,  the "Agreements"),  or contracted for, charged,
taken,  reserved or received with respect to the indebtedness  evidenced by this
Note which results in Maker having paid any interest in excess of that permitted
by law, then it is Maker's and Payee's  express  intent that all excess  amounts
theretofore collected by Payee be credited on the principal balance of this Note
(or, if this Note has been or would be thereby paid in full, refunded to Maker),
and the provisions of this Note and the other  Agreements  immediately be deemed
reformed  and  the  amounts  thereafter  collectible  hereunder  and  thereunder
reduced,  without the necessity of the  execution of any new document,  so as to
permit the recovery of the fullest  amount called for hereunder and  thereunder,
while complying in all respects with the applicable law. The right to accelerate
maturity  of this Note does not  include the right to  accelerate  any  interest
which has not otherwise accrued on the date of such acceleration, and Payee does
not intend to collect any unearned  interest in the event of  acceleration.  All
sums paid or agreed to be paid to Payee for the use, forbearance or detention of
the Loan  shall,  to the extent  permitted  by  applicable  law,  be  amortized,
prorated,  allocated  and  spread  throughout  the full  term of the Loan  until
payment  in full so that the rate or amount of  interest  on account of the Loan
does not exceed the  applicable  usury  ceiling.  Notwithstanding  any provision
contained  in this  Note or in any of the  other  Agreements  that  permits  the
compounding of interest, including without limitation any provision by which any
of the accrued interest is added to the principal amount of this Note, the total
amount of  interest  that Maker is  obligated  to pay and Payee is  entitled  to
receive  with respect to this Note shall not exceed the amount  calculated  on a
simple  (i.e.,  noncompounded)  interest  basis at the  Highest  Lawful  Rate on
principal  amounts actually  advanced to or for the account of Maker,  including
the initial  principal amount of this Note and any advances made pursuant to any
of the Agreements (such as for the payment of taxes,  insurance premiums and the
like).

         10.  Business  Purposes.  Maker hereby  represents  and warrants to the
holder of this Note that the loan  evidenced  hereby is a "contract  under which
credit  is  extended  for  business,  commercial  investment,  or other  similar
purpose," and is not a loan for "personal,  family,  household,  or agricultural
use."




<PAGE>



         11.  Warrant  Coverage.  Upon  receipt of the  proceeds of this Note by
Maker, Payee will receive from Glenn Norem,  personally, a transfer of a warrant
or  warrants  to  purchase  a  total  of  20,000  shares  of  MultiMedia  Access
Corporation  common stock.  The exercise price of said warrant(s) will be priced
at $3.00 per share and the warrant(s) will expire November 15, 1999.

         12.  Notices.  All notices or demands  required or permitted  hereunder
shall be in writing and shall be deemed given when actually  delivered or on the
third business day following the day on which the same shall have been mailed by
registered or certified mail, postage prepaid, addressed as follows:

         If to Maker:               MultiMedia Access Corporation
                                    Two Metro Square
                                    2665 Villa Creed Drive
                                    Suite 200
                                    Dallas, TX  75234
                                    Attn: William S. Leftwich

         If to Payee:               H. T. Ardinger
                                    9040 Governors Row
                                    Dallas, TX  75247

         Either Maker or Payee may change its respective address or addressee by
giving notice of such change to the other party in the manner  provided  herein.
For this  purpose  only,  unless  and until  such  written  notice  is  actually
received,  the address and addressee specified for each party shall be deemed to
continue on effect for all purposes.

         13.  GOVERNING LAW. This Note shall be construed in accordance with and
governed by the laws of the State of Texas.

         14.  Headings.  The  headings of the sections of this Note are inserted
for convenience only and shall not be deemed to constitute a part thereof.

         IN  WITNESS  WHEREOF,  the  undersigned  has  executed  this Note to be
effective as of the date first written above.

                                  MAKER:

                                  MultiMedia Access Corporation, a
                                  Delaware Corporation



                                  By:  /s/ William S. Leftwich
                                       -----------------------------
                                       William S. Leftwich
                                       Chief Financial Officer




                                                                    EXHIBIT 11

                MULTIMEDIA ACCESS CORPORATION AND SUBSIDIARIES
                        (A DEVELOPMENT STAGE COMPANY)
                 STATEMENT RE: COMPUTATION OF LOSS PER SHARE

<TABLE>
<CAPTION>
                                                                                           FOR THE NINE MONTHS
                                                         YEAR ENDED DECEMBER 31,           ENDED SEPTEMBER 30,
                                                     ------------------------------- -------------------------------
                                                           1994            1995            1995            1996
                                                     --------------- --------------- --------------- ---------------
                                                                                       (UNAUDITED)     (UNAUDITED)
<S>                                                  <C>             <C>             <C>             <C>
LOSS PER SHARE DATA:

Net loss as reported in the financial statements ..  $(2,717,421)    $(5,414,878)    $(3,509,510)    $(3,081,082)
                                                     =============== =============== =============== ===============

Weighted average number of common shares
outstanding .......................................    3,018,610       3,528,536       3,341,116       4,774,326

Common and common  equivalent shares issued in the twelve month period preceding
the filing date of the initial public offering as required by SAB No.
83:
 Common stock .....................................      822,080         696,406         822,080         191,599
 Incentive stock options ..........................      372,182         372,182         372,182         372,182
 Non-qualified stock options ......................       54,830          54,830          54,830          54,830
 Warrants .........................................      890,230         890,230         890,230         890,230
                                                     --------------- --------------- --------------- ---------------

Weighted average number of common and common
 equivalent shares outstanding as reported in the
 financial statements .............................    5,157,932       5,542,184       5,480,438       6,283,167
                                                     =============== =============== =============== ===============

Loss per share as reported in the financial
 statements........................................  $     (0.53)    $     (0.98)    $     (0.64)    $     (0.49)
                                                     =============== =============== =============== ===============

SUPPLEMENTAL LOSS PER SHARE DATA:

Net loss as reported in the financial statements  .                  $(5,414,878)                    $(3,081,082)

Interest saved on debt to be retired:
 $222,548 of 15% secured debt .....................                       33,382                          25,087
 $347,250 of 8% convertible debt ..................                       27,780                          20,835
 $35,000 of non-interest debt at 12/31/95 .........                           --                              --
 $120,000 of non-interest debt at 6/30/96 .........                           --                              --
                                                                     ---------------                 ---------------
 $850,000 of 8% debt at 9/30/96 ...................                           --                          10,905
                                                                     ---------------                 ---------------

Adjusted net loss                                                    $(5,353,716)                    $(3,024,305)
                                                                     ===============                 ===============

Weighted average number of common and common
 equivalent shares outstanding as reported in the
 financial statements .............................                    5,542,184                       6,283,167

Shares necessary to pay off debt:
 Total proceeds to retire debt of $604,798 at
  December 31, 1995 and $1,539,798 at September 30,
  1996 divided by the offering price of $5.50 per
  share ...........................................                      109,963                         279,963

Adjusted weighted average number of shares ........
                                                                     ---------------                 ---------------
 outstanding ......................................                    5,652,147                       6,563,130
                                                                     ===============                 ===============

Supplemental loss per share .......................                  $     (0.95)                    $     (0.46)
                                                                     ===============                 ===============
</TABLE>

                                       





HOFFMAN, MORRSION & FITZGERALD, P.C.
Certified Public Accountants and Consultants




October 7, 1996




U.S. Securities and Exchange Commission
450 5th Street, NW
Washington, DC  20549

Re:  MULTIMEDIA ACCESS CORPORATION
     FILE # 33-9935

Dear Sir/Madam:

We were previously the principal  accountant for MultiMedia  Access  Corporation
(the  "Company")  and under the date  March 17,  1995,  except for note 12 as to
which the date is May 8, 1995, reported on the consolidated  financial statement
of the Company and its  subsidiaries  for the year ended  December 31, 1994.  On
November 3, 1995, our  appointment as principal  accountant was  terminated.  We
have read the  Company's  statements  included  under the caption  "Experts"  in
amendment number 1 to the above referenced  registration  statement on Form SB-2
as filed  with the  Commission  on  October  7,  1996,  and we agree  with  such
statements.

Very truly yours,


/s/  Hoffman, Morrison & Fitzgerald, P.C.

HOFFMAN, MORRISON & FITZGERALD, P.C.
Certified Public Accountants and Consultants

                               November 12, 1996



Securities and Exchange Commission
450 Fifth Street, N.W.
Washington, D.C.  20549

Re:  MULTIMEDIA ACCESS CORPORATION
     REGISTRATION STATEMENT

Dear Sir/Madam:

     We are corporate and securities  counsel to Multimedia  Access  Corporation
(the "Company"), a Delaware corporation,  in connection with the registration on
Form SB-2 of  2,547,244  shares  of the  Company's  Common  Stock  (the  "Common
Stock"),  2,547,244  Redeemable Common  Stock  Purchase  Warrants  (the  "Public
Warrants"), the 2,547,244 shares of Common Stock underlying the Public Warrants.

     We hereby  advise that,  in our opinion,  the shares of Common  Stock,  the
Public  Warrants and the shares of Common Stock  underlying the Public  Warrants
have been duly authorized by all necessary corporate acts of the Company, and
when  issued,  delivered  and  paid  for by  the  Underwriter,  pursuant  to the
Underwriting  Agreement,  will be legally and  validly  issued,  fully-paid  and
non-assessable.

     We consent to the use of our firm's name under the heading "Legal  Matters"
in the  Registration  Statement,  and any  amendments  thereto,  filed  with the
Securities  and Exchange  Commission  in  connection  with the  above-referenced
offering.

                                                  Very truly yours,



                                                  /s/  John S. Stoppleman
                                                  John S. Stoppleman





E:\MAC\SECLGOP.WPF



                                                                   EXHIBIT 23B

                       CONSENT OF INDEPENDENT AUDITORS

   
   We consent to the  reference to our firm under the caption  "Experts"  and to
the use of our report  dated  April 5, 1996 in the  Registration  Statement  No.
333-09935 (Form SB-2) and related  Prospectus of MultiMedia  Access  Corporation
for the  registration  of  1,800,000  shares of its common  stock and  1,800,000
redeemable common stock purchase warrants.

Dallas, TX
November 15, 1996                                             ERNST & YOUNG LLP

    


                                                                   EXHIBIT 23C

                       CONSENT OF INDEPENDENT AUDITORS

   We consent to the  reference to our firm under the caption  "Experts"  and to
the use of our report dated March 17, 1995,  except for note 12, as to which the
date is May 8, 1995 in the Registration  Statement No. 333-09935 (Form SB-2) and
related  Prospectus of MultiMedia  Access  Corporation  for the  registration of
1,800,000  shares of its common  stock and  1,800,000  redeemable  common  stock
purchase warrants.

Vienna, VA                                  HOFFMAN, MORRISON & FITZGERALD, P.C.
November 15, 1996                   (formerly Hoffman, Dykes & Fitzgerald, P.C.)
 





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