APPLIED DIGITAL SOLUTIONS INC, POS AM, 1999-10-15

APPLIED DIGITAL SOLUTIONS INC
POS AM, 1999-10-15
TELEPHONE & TELEGRAPH APPARATUS

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As Filed with the Securities and Exchange Commission on October 15, 1999

Post-Effective Amendment No. 3 to Registration Statements
Nos. 333-25431, 333-37713, 333-45139, 333-51067 and 333-64755 and
Post-Effective Amendment No. 1 to Registration Statement No. 333-81533*

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

SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Post-Effective Amendment No. 3*
to
FORM S-3
and
POST-EFFECTIVE AMENDMENT NO. 1*
to
FORM S-1
REGISTRATION STATEMENTS
Under
THE SECURITIES ACT OF 1933
APPLIED DIGITAL SOLUTIONS, INC.
(Exact name of registrant as specified in its charter)
MISSOURI 3661 43-1641533
(State or other jurisdiction of (Primary Standard Industrial (I.R.S. Employer
incorporation or organization) Classification Code Number) Identification No.)
400 Royal Palm Way, Suite 410
Palm Beach, Florida 33480
(561) 366-4800
(Address, including zip code, and telephone number,
including area code, of registrant's principal executive offices)

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

Garrett A. Sullivan Copies of all correspondence to:
400 Royal Palm Way, Suite 410 Denis P. McCusker, Esq.
Palm Beach, Florida 33480 Bryan Cave LLP
(561) 366-4800 One Metropolitan Square
(Name, address, including zip code, 211 North Broadway,
and telephone number, Suite 3600 St. Louis,
including area code, of agent for service) Missouri 63102-2750
(314) 259-2000

Approximate date of commencement of proposed sale to public: As soon as
practicable after this registration statement becomes effective.
If any of the securities being registered on this form are to be offered on
a delayed or continuous basis pursuant to Rule 415 under the Securities Act of
1933, check the following box. [X]
If this Form is filed to register additional securities for an offering
pursuant to Rule 462(b) under the Securities Act, please check the following box
and list the Securities Act registration statement number of the earlier
effective registration statement for the same offering. [ ]
If this Form is a post-effective amendment filed pursuant to Rule 462(c)
under the Securities Act, check the following box and list the Securities Act
registration statement number of the earlier effective registration statement
for the same offering. [ ]
If this Form is a post-effective amendment filed pursuant to Rule 462(d)
under the Securities Act, check the following box and list the Securities Act
registration statement number of the earlier effective registration statement
for the same offering. [ ]
If delivery of the prospectus is expected to be made pursuant to Rule 434,
please check the following box. [ ]
The Registrant hereby amends this Post-Effective Amendment 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 Post-Effective
Amendment shall thereafter become effective in accordance with Section 8(a) of
the Securities Act of 1933 or until the Post-Effective Amendment shall become
effective on such date as the Commission, acting pursuant to said Section 8(a),
may determine.
- --------------------------------------------------------------------------------
* As the Registrant is once again eligible to use Form S-3, this
Post-Effective Amendment No. 3 on Form S-3 is being filed to convert
Post-Effective Amendment No. 2 on Form S-1 to the following Registration
Statements filed originally on Form S-3: Nos. 333-25431 (filed 4/18/97),
333-37713 (filed 10/10/97), 333-45139 (filed 1/29/98), 333-51067 (filed
4/27/98) and 333-64755 (filed 9/30/98) into Registration Statements on Form
S-3 and this Post-Effective Amendment No. 1 on Form S-1 is being filed to
convert Registration Statement No. 333-81533 (filed 6/25/99) on Form S-1
into a Registration Statement on Form S-3.

<PAGE>
- --------------------------------------------------------------------------------
The information in this preliminary prospectus is not complete and may be
changed. The Selling Shareholders may not sell these securities until the
amendment to registration statement filed with the Securities and Exchange
Commission is effective. This preliminary prospectus is not an offer to sell
these securities and we are not soliciting any offer to buy these securities in
any state where the offer or sale is not permitted.
- --------------------------------------------------------------------------------

[OBJECT OMITTED]
Subject to completion, Dated OCTOBER 15, 1999

37,184,903 Shares
[GRAPHIC OMITTED]
Common Stock
------------------

This combined prospectus relates to 37,184,903 shares of our Common Stock,
par value $.001 per share, which have previously been registered for offering
and sale under six separate registration statements. These shares will be sold
at various times by the Selling Shareholders listed in this prospectus starting
on page 12. More information about the shares is under "Description of Capital
Stock."

The registration statements relating to certain of the shares were
originally filed with the SEC on Form S-3. Since certain financial information
which we were required to file with a report on Form 8-K was filed late during
1998, we were temporarily ineligible to use Form S-3 for the offering of those
shares, and we amended the prospectus for each registration statement to include
the more detailed information required in a registration statement on Form S-1.
During this same time, we registered an additional 10,714,602 shares on a Form
S-1. However, we have since become eligible to use Form S-3 again and
accordingly, we have revised the prospectus for each of the above-referenced
registration statements as set forth herein to reflect the information required
to be set forth in or incorporated into a registration statement on Form S-3.

The Selling Shareholders may sell the shares of Common Stock in one or more
transactions (which may include "block transactions") on the NASDAQ Stock
Market, in the over-the-counter market, in negotiated transactions or in a
combination of such methods of sales, at fixed prices which may be changed, at
market prices prevailing at the time of sales, at prices related to such
prevailing market prices or at negotiated prices.

Our shares are listed on the NASDAQ Stock Market under the symbol "ADSX."
On October 11, 1999, the last reported sale price of our Common Stock was
$1 13/16 or $1.8125 per share. See "Price Range of Common Stock."

We will not receive any proceeds from shares sold by the Selling
Shareholders and we will bear all the expenses incurred in connection with
registering this offering of Common Stock.

The Selling Shareholders may sell the shares of Common Stock directly or
through underwriters, dealers or agents. They may also pledge some of the shares
of Common Stock. This prospectus also relates to any sale of shares of Common
Stock that might take place following any foreclosure of such a pledge. More
information about the way the Selling Shareholders may distribute the Common
Stock is under the heading "Plan of Distribution."

See the information under the heading "Risk Factors" starting on page 4,
which describes certain factors you should consider before purchasing the Common
Stock.

Our principal office is at 400 Royal Palm Way, Suite 410, Palm Beach,
Florida 33480, and our telephone number is (561) 366-4800.

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

Neither the Securities and Exchange Commission nor any state securities
commission has approved or disapproved of these securities, or passed upon the
adequacy or accuracy of this prospectus. Any representation to the contrary is a
criminal offense.
--------------------------

The date of this prospectus is [_____________], 1999.

<PAGE>

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

TABLE OF CONTENTS

Where You Can Find More Information............................................2
Incorporation Of Certain Documents By Reference................................3
Risk Factors...................................................................4
Our Business...................................................................9
Selling Shareholders..........................................................12
Description Of Capital Stock..................................................29
Price Range of Common Stock...................................................29
Plan Of Distribution..........................................................30
Legal Opinion.................................................................30
Experts.......................................................................30

WHERE YOU CAN FIND MORE INFORMATION

This prospectus constitutes a part of our Post-Effective Amendment No. 3 on
Form S-3 and Post-Effective Amendment No. 1 on Form S-1 which has been filed by
us with the Securities and Exchange Commission to convert our Post-Effective
Amendment No. 2 on Form S-1 to the following previously effective registration
statements filed originally on Form S-3 (Nos. 333-25431 (filed 4/18/97),
333-37713 (filed 10/10/97), 333-45139 (filed 1/29/98), 333-51067 (filed 4/27/98)
and 333-64755 (filed 9/30/98)) into registration statements on Form S-3, and our
registration statement on Form S-1 (No. 333-81533) (filed 6/25/99) into a
registration statement on Form S-3. This prospectus does not contain all of the
information set forth in the registration statements or the exhibits thereto. As
permitted by the rules and regulations of the Securities and Exchange
Commission, this prospectus omits certain information contained or incorporated
by reference in the registration statements. Our description in this prospectus
concerning the contents of any contract, agreement or other document are not
necessarily complete. For those contracts, agreements or other documents that we
filed as exhibits to the registration statements, you should read the exhibit
for a more complete understanding of the documents or subject matter involved.
For further information, reference is hereby made to the registration statements
and exhibits thereto.

On September 14, 1999, our subsidiary Intellesale.com, Inc. filed a
registration statement with the Securities and Exchange Commission in connection
with its proposed initial public offering. In addition to Intellesale.com
selling primary shares, we expect to sell shares of Intellesale.com stock as a
selling shareholder. Although the registration statement has been filed with the
Securities and Exchange Commission, it has not yet become effective, and no
assurances can be given that such offering will be completed.

We are subject to the informational requirements of the Securities Exchange
Act of 1934, as amended (the "Exchange Act"), and, in accordance therewith, file
reports, proxy statements and other information with the Securities and Exchange
Commission. You may read and copy the registration statements, including the
attached exhibits and schedules, and any reports, proxy statements or other
information that we file at the Securities and Exchange Commission's public
reference rooms at Room 1024, Judiciary Plaza, 450 Fifth Street, N.W.,
Washington, D.C. 20549 and at the Securities and Exchange Commission's regional
offices located at Northeast Regional Office, Seven World Trade Center, Suite
1300, New York, New York 10048 and Midwest Regional Office, Citicorp Center, 500
West Madison Street, Suite 1400, Chicago, Illinois 60661. You can request copies
of these documents by writing to the Securities and Exchange Commission and
paying a duplicating charge. Please call the Securities and Exchange Commission
at 1-800-732-0330 for further information on the operation of its public
reference rooms in other cities. The Securities and Exchange Commission also
makes our filings available to the public on its Internet site (http:\\
www.sec.gov). Quotations relating to our Common Stock appear on the Nasdaq
National Market, and such reports, proxy statements and other information
concerning us can also be inspected at the offices of the National Association
of Securities Dealers, Inc., 1735 K Street, N.W., Washington, D.C. 20006.

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<PAGE>

INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE

The Securities and Exchange Commission allows us to "incorporate by
reference" the information we file with it. This means that we can disclose
important information to you by referring you to other documents that we have
filed separately with the Securities and Exchange Commission. You should
consider the incorporated information as if we had reproduced it in this
prospectus, except for any information directly superseded by information
contained in this prospectus.

We incorporate by reference into this prospectus, the following documents,
which contain important information about us and our business and financial
results:

1. Our Annual Report on Form 10-K for the fiscal year ended December
31, 1998;

2. Our Quarterly Report on Form 10-Q for the quarter ended March 31,
1999;

3. Our Quarterly Report on Form 10-Q for the quarter ended June 30,
1999;

4. Our Current Report on Form 8-K/A dated June 8, 1998 (filed with the
Securities and Exchange Commission on March 11, 1999);

5. Our Current Report on Form 8-K dated May 25, 1999 (filed with the
Securities and Exchange Commission on June 2, 1999, and as amended on Form
8-K/A filed with the Securities and Exchange Commission on October 5,
1999);

6. Our Current Report on Form 8-K dated June 4, 1999 (filed with the
Securities and Exchange Commission on June 11, 1999, and as amended on Form
8-K/A filed with the Securities and Exchange Commission on August 12,
1999);

7. Our Current Report on Form 8-K dated September 14, 1999 (filed with
the Securities and Exchange Commission September 14, 1999); and

8. Our Registration Statement on Form 8-A filed on May 5, 1995,
registering our Common Stock under Section 12 (g) of the Exchange Act,
including any amendments or reports filed for the purpose of updating such
description.

All documents filed by us with the Securities and Exchange Commission
pursuant to Sections 13(a), 13(c), 14 or 15(d) of the Exchange Act subsequent to
the date hereof and prior to the termination of the offering shall hereby be
deemed to be incorporated by reference in this prospectus and to be a part
hereof from the date of filing of such documents. You should consider any
statement contained in this prospectus (or in a document incorporated or deemed
to be incorporated into this prospectus) to be modified or superseded to the
extent that a statement contained herein or in any other subsequently filed
document incorporated or deemed to be incorporated herein by reference, which
statement is also incorporated herein by reference, modifies or supersedes such
statement. Any such statement so modified or superseded will no longer
constitute a part of this prospectus, except as so modified or superseded.

We will provide you with copies of any of the documents incorporated by
reference into this prospectus (other than exhibits attached to those documents,
unless such exhibits are specifically incorporated by reference into the
information incorporated herein), without charge. Please direct your written or
oral request to Applied Digital Solutions, Inc., 400 Royal Palm Way, Suite 410,
Palm Beach, Florida 33480; Attention: Kay Langsford, Corporate Controller
(telephone: (561) 366-4800).

We have not authorized anyone to give any information or to make any
representation concerning this offering except the information and
representations which are contained in this prospectus or which are incorporated
by reference in this prospectus. If anyone gives or makes any other information
or representation, you should not rely on it. This prospectus is not an offer to
sell, or a solicitation of an offer to purchase, any securities other than those
to which it relates, nor does it constitute an offer to sell or a solicitation
of an offer to purchase by any person in any circumstances in which an offer or
solicitation is unlawful. You should not interpret the delivery of this
prospectus or any sale made hereunder as an indication that there has been no
change in our affairs since the date of this prospectus. You should also be
aware that the information in this prospectus may change after this date.

3
<PAGE>

RISK FACTORS

You should carefully consider the risk factors listed below. These risk
factors may cause our future earnings to be less or our financial condition to
be less favorable than we expect. You should read this section together with the
other information in this prospectus.

Forward-Looking Statements and Associated Risk

This prospectus, including the information incorporated herein by
reference, contains "forward-looking statements" as defined in the Private
Securities Litigation Reform Act of 1995. All such forward-looking information
involves risks and uncertainties and may be affected by many factors, some of
which are beyond our control. These factors include:

o our growth strategies,

o anticipated trends in our business and demographics,

o our ability to successfully integrate the business operations of recently
acquired companies, and

o regulatory, competitive or other economic influences.

Uncertainty of Future Financial Results

While we have been profitable for the last three fiscal years, future
financial results are uncertain. There can be no assurance that we will continue
to be operated in a profitable manner. Profitability depends upon many factors,
including the success of our various marketing programs, the maintenance or
reduction of expense levels and our ability to successfully coordinate the
efforts of the different segments of our business.

Future Sales of and Market for the Shares

As of October 11, 1999, there were 47,568,948 shares of Common Stock
outstanding. In addition, 836,472 shares of Common Stock are reserved for
issuance in exchange for certain exchangeable shares issued by two of our
subsidiaries. Since January 1, 1999, we have issued an aggregate of 12,013,862
shares of Common Stock, of which 5,928,220 shares of Common Stock were issued as
earnout payments in acquisitions, 2,508,668 shares were issued in exchange for
such exchangeable shares, 121,465 shares were issued to acquire a minority
interest, 3,390,843 shares of Common Stock were issued for acquisitions
(including "price protection" shares), and 64,666 shares of Common Stock were
issued for services rendered, including services under employment agreements and
employee bonuses.

Although we previously announced that we intend to limit the use of stock
in future acquisitions, and to focus on cash transactions, we have effected, and
may continue to effect, acquisitions or contract for certain services through
the issuance of Common Stock or our other equity securities, as we have
typically done in the past. In addition, we have agreed to certain "price
protection" provisions in acquisition agreements which may result in additional
shares of common stock being issued to selling shareholders as of the effective
date of the registration of the shares such selling shareholder previously
received as consideration from us. Such issuances of additional securities may
be dilutive of the value of the Common Stock in certain circumstances and may
have an adverse impact on the market price of the Common Stock.

4
<PAGE>

Competition

Each segment of our business is highly competitive, and we expect that
competitive pressures will continue. Many of our competitors have far greater
financial, technological, marketing, personnel and other resources than us. The
areas which we have identified for continued growth and expansion are also
target market segments for some of the largest and most strongly capitalized
companies in the United States, Canada and Europe. There can be no assurance
that we will have the financial, technical, marketing and other resources
required to compete successfully in this environment in the future.

Risks Associated with Acquisitions and Expansion

We have engaged in a continuing program of acquisitions of other businesses
which are considered to be complementary to our lines of business, and we
anticipate that such acquisitions will continue to occur. Our total assets were
approximately $208 million as of June 30, 1999 and $124 million, $61 million,
$33 million and $4 million as of December 31, 1998, 1997, 1996 and 1995,
respectively. Net operating revenue was approximately $125 million for the six
months ended June 30, 1999 and approximately $207 million, $103 million, $20
million and $2 million for the years ended December 31, 1998, 1997, 1996 and
1995, respectively. Managing these dramatic changes in the scope of our business
will present ongoing challenges to management, and there can be no assurance
that our operations as currently structured, or as affected by future
acquisitions, will be successful.

We may require substantial additional capital, and there can be no
assurance as to the availability of such capital when needed, nor as to the
terms on which such capital might be made available to us.

It is our policy to retain existing management of acquired companies, under
the overall supervision of our senior management. The success of the operations
of these subsidiaries will depend, to a great extent, on the continued efforts
of the management of the acquired companies.

We have entered into earnout arrangements with selling shareholders under
which they are entitled to additional consideration for their interests in the
companies they sold to us. Under these agreements, assuming that all earnouts
are achieved, and assuming certain levels of profitability in the future, we are
contingently liable for additional consideration amounting to approximately
$4.5 million based on achieved 1999 results, approximately $8.3 million based
on achieved 2000 results, approximately $10.9 million based on achieved 2001
results, and approximately $2 million based on each of 2002 and 2004 achieved
results.

We have entered into put options with the selling shareholders of those
companies in which we acquired less than a 100% interest. These options provide
for us to acquire the remaining portion we do not own after periods ranging from
4 to 5 years from the dates of acquisition at amounts per share generally equal
to 10% - 20% of the average annual earnings per share of the company before
income taxes for, generally, a two-year period ending on the effective date of
the put multiplied by a multiple ranging from 4 to 5. The requirements are
recorded as changes in minority interest based upon current operating results.

5
<PAGE>

Dependence on Key Individuals

Our future success is highly dependent upon our ability to attract and
retain qualified key employees. We are organized with a small senior management
team, with each of our separate operations under the day-to-day control of local
managers. If we were to lose the services of any members of our central
management team, our overall operations could be adversely affected, and the
operations of any of our individual facilities could be adversely affected if
the services of the local managers should be unavailable. We have entered into
employment contracts with our key officers and employees and certain
subsidiaries. The agreements are for periods of one to ten years through June
2009. Some of the employment contracts also call for bonus arrangements based on
earnings.

Lack of Dividends on Common Stock; Issuance of Preferred Stock

We do not have a history of paying dividends on our Common Stock, and there
can be no assurance that such dividends will be paid in the foreseeable future.
Under the terms of our term and revolving credit agreement, we may declare and
pay cash dividends of up to $150,000 in any calendar year. We intend to use any
earnings which may be generated to finance the growth of our businesses. The
Board of Directors has the right to authorize the issuance of preferred stock,
without further shareholder approval, the holders of which may have preferences
over the holders of the Common Stock as to payment of dividends.

Possible Volatility of Stock Price

Our Common Stock is quoted on the NASDAQ Stock Market(R), which stock
market has experienced and is likely to experience in the future significant
price and volume fluctuations which could adversely affect the market price of
our Common Stock without regard to our operating performance. In addition, we
believe that factors such as the significant changes to our business resulting
from continued acquisitions and expansions, quarterly fluctuations in our
financial results or cash flows, shortfalls in earnings or sales below analyst
expectations, changes in the performance of other companies in our same market
sectors and the performance of the overall economy and the financial markets
could cause the price of our Common Stock to fluctuate substantially. During the
12 months preceding the date of this prospectus, the price per share of our
Common Stock has ranged from a high of $5 1/2 to a low of $1 17/32.

Termination Payments

Our employment agreements with three of our executive officers include
"change of control" provisions, under which the employees may terminate their
employment within one year after a change of control, and be entitled to receive
specified severance payments and/or continued compensation payments for 60
months. Also, the agreements for both Richard Sullivan and Garrett Sullivan
provide for certain "triggering events" which include a change in control, the
termination of Richard Sullivan's employment other than for cause, or if Richard
Sullivan ceases to hold his current positions with us for any reason other than
a material breach of the terms of his employment agreement. In that case, we
would be obligated to pay, in cash and/or in stock, $12.1 million and $3.5
million, respectively, to Richard Sullivan and to Garrett Sullivan, in addition
to certain other compensation.

Our obligations to make the payments described in this section could
adversely affect our financial condition or could discourage other parties from
entering into transactions with us which might be treated as a change in control
or triggering event for purposes of these agreements.

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Year 2000 Compliance

Background. Some computers, software and other equipment include
programming code in which calendar year data is abbreviated to only two digits.
As a result of this design decision, some of these systems could fail to operate
or fail to produce correct results if "00" is interpreted to mean 1900, rather
than 2000. These problems are widely expected to increase in frequency and
severity as the year 2000 approaches, and are commonly referred to as the
"Millennium Bug" or "Year 2000 problem."

Assessment. The Year 2000 problem could affect computers, software and
other equipment used, operated, or maintained by us. Accordingly, we are
reviewing our internal computers, software, applications and related equipment
and our systems other than information technology systems to ensure that they
will be Year 2000 compliant. We believe that our Year 2000 plan will be
completed in all material respects prior to the anticipated Year 2000 failure
dates. We spent approximately $.2 million in 1998 on our Year 2000 compliance
plan and estimate an additional $.5 million will be spent in 1999, most of which
relates to new equipment. There can be no assurance however, that the total
costs will be limited to this amount.

Software Sold to Consumers. We are in the process of identifying all
potential Year 2000 problems with any of the software products we develop and
market. However, management believes that it is not possible to determine with
complete certainty that all Year 2000 problems affecting our software products
will be identified or corrected due to the complexity of these products. In
addition, these products interact with other third party vendor products and
operate on computer systems which are not under our control. For non-compliant
products, we are providing recommendations as to how an organization may address
possible Year 2000 issues regarding that product. Software updates are available
for most, but not all, known issues. Such information is the most currently
available concerning the behavior of our products and is provided "as is"
without warranty of any kind. However, variability of definitions of
"compliance" with the Year 2000 and of different combinations of software,
firmware and hardware could likely lead to lawsuits against us. The outcome of
any such lawsuits and the impact on us are not estimable at this time.

Internal Infrastructure. We believe that our major computers, software
applications and related equipment used in connection with our internal
operations are not subject to significant Year 2000 problems, because the
computer programs used by us are primarily off-the-shelf, recently developed
programs from third-party vendors. We are in the process of obtaining assurances
from such vendors as to the Year 2000 compliance of their products. Most vendors
are reluctant to provide written assurances and, although some vendors may make
verbal assurances of Year 2000 compliance, there can be no certainty that the
systems utilized by us will not be affected. We have assessed all 40 of our
operating locations and have determined that 29 of the 40 locations are Year
2000 compliant. Of the remaining 11 locations, 7 are in the process of upgrading
or replacing their current systems and 4 are replacing their systems. All
internal infrastructure systems and equipment are expected to be Year 2000
compliant prior to the anticipated Year 2000 failure dates.

Systems Other than Information Technology Systems. In addition to computers
and related systems, the operation of office and facilities equipment, such as
fax machines, photocopiers, telephone switches, security systems, elevators, and
other common devices may be affected by the Year 2000 problem. We have assessed
all 40 of our operating locations and have determined that 38 of the 40
locations are Year 2000 compliant. The remaining 2 locations are in the process
of upgrading or replacing the current systems. All non-information technology
systems and equipment are expected to be Year 2000 compliant prior to the
anticipated Year 2000 failure dates.

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Suppliers. We have initiated communications with third party suppliers of
the major computers, software, and other equipment used, operated, or maintained
by us to identify and, to the extent possible, to resolve issues involving the
Year 2000 problem. However, we have limited or no control over the actions of
these third party suppliers. Thus, while we expect that we will be able to
resolve any significant Year 2000 problems with these systems, there can be no
assurance that these suppliers will resolve any or all Year 2000 problems with
these systems before the occurrence of a material disruption to our business or
any of our customers. Any failure of these third parties to resolve Year 2000
problems with their systems in a timely manner could have a material adverse
effect on our business, financial condition, results of operations and cash
flows.

Internet. As more of our business is conducted over the internet, it is
possible that we experience dispersed, intermittent telecommunications problems
experienced by local internet service providers and their users throughout the
country and world, preventing those customers from being able to access our
Website. This could be combined with, or result from, intermittent power
problems which could cause similar problems with accessing the Website.
Additionally, many customers may be using older systems which may not be Year
2000 compliant, and this would prevent them from accessing our Website. Under
this scenario, we would continue operations, but our Website would be
inaccessible to the individuals or groups affected by these problems. If our
credit card processors are not Year 2000 compliant, we will not be able to
process credit card sales. If our vendors are not Year 2000 compliant, we will
not be able to obtain products from our vendors or our vendors may not be able
to ship products sold to our customers. In the event of this worst case
scenario, we could lose significant revenues from customers unable to purchase
from the site, be unable to ensure delivery of products to customers, incur
expenses to repair our systems, face interruptions in the work of our employees,
lose advertising revenue and suffer damage to our reputation.

Contingency Plans. At certain subsidiaries, where we feel it is necessary,
we are preparing contingency plans relating specifically to identified Year 2000
risks and developing cost estimates relating to these plans. Contingency plans
may include stockpiling raw and packaging materials, increasing inventory
levels, securing alternate sources of supply and other appropriate measures. We
anticipate completion of the Year 2000 contingency plans prior to the
anticipated Year 2000 failure dates. Once developed, Year 2000 contingency plans
and related cost estimates will be tested in certain respects and continually
refined as additional information becomes available.

Most Likely Consequences of Year 2000 Problems. We expect to identify and
resolve all Year 2000 problems that could materially adversely affect our
business operations and cash flows. However, management believes that it is not
possible to determine with complete certainty that all Year 2000 problems
affecting us have been identified or corrected. The number of devices that could
be affected and the interactions among these devices are simply too numerous. In
addition, one cannot accurately predict how many Year 2000 problem-related
failures will occur or the severity, duration, or financial consequences of
these perhaps inevitable failures. As a result, management expects that we may
suffer the following consequences:

A. A significant number of operational inconveniences and inefficiencies
for us and our clients that may divert management's time and attention
and financial and human resources from its ordinary business
activities; and

B. A lesser number of serious system failures that may require
significant efforts by us or our customers to prevent or alleviate
material business disruptions.

Based on the activities described above, we do not believe that the Year
2000 problem will have a material adverse effect on our business, results of
operations or cash flows. The estimate of the potential impact on our financial
position, overall results of operations or cash flows for the Year 2000 problem

8
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could change in the future. The discussion of our efforts, and management's
expectations, relating to Year 2000 compliance are forward-looking statements.
Our ability to achieve Year 2000 compliance and the level of incremental costs
associated therewith, could be adversely impacted by, among other things, the
availability and cost of programming and testing resources, vendors' ability to
modify proprietary software, and unanticipated problems identified in the
ongoing compliance review.

OUR BUSINESS

General

We are a full service communications company that provides a wide range of
products and services to the wireless, telecommunications and digital data
industry. Our goal is to be a single source communications provider that
businesses can turn to for integrated communications systems. To achieve this
goal, we intend to take advantage of the communication industry's move from
analog to digital and from wireline to wireless systems. Our services include
the construction and installation of communications infrastructure, the
installation of local and wide area networks and the development of specialized
software for business applications. We also provide traditional
telecommunications services such as long distance toll service, one-number
dialing and call centers. We currently operate in the United States, Canada and
the United Kingdom.

The majority of our current operations are the result of acquisitions
completed during the last five years. Our net operating revenues were $207.1
million, $103.2 million, $19.9 million, $2.3 million and $0.3 million
respectively, in 1998, 1997, 1996, 1995 and 1994. Since 1994 we have completed
39 acquisitions. Management analyzes each acquisition opportunity using criteria
including profitability over a two to three year period, the strength of its
balance sheet, the strength of its customer base and the experience of its
management team. Going forward, we intend to make acquisitions that fit within
one of our five primary operating divisions. Since January 1, 1999, we have
completed six acquisitions.

Business Divisions

Prior to March 1999, our business was organized into three, and then
eventually, four business groups, or industry segments: the Services and
Solutions Group (formerly the Retail Group), the Computer Group, the
Manufacturing Group and the International Group. Each operating business was
conducted through a separate subsidiary company directed by its own management
team, and each subsidiary company had its own marketing and operations support
personnel. Each management team originally reported to our President, who was
responsible for overall corporate control and coordination, as well as financial
planning. Later, a Group Vice President was added and the management teams
reported to the Group Vice President, who ultimately reported to our President.
The Chairman was responsible for our overall business and strategic planning.

In March 1999, we announced a corporate reorganization at which time we
named five new divisions as outlined below. Each division is managed by a
division president who reports to the Senior Vice President who in turn reports
to the President. Each division either has in place or is in the process of
hiring a vice president of marketing and a financial controller. We believe we
will attain increased operating efficiencies through this reorganization and
believe this structure will facilitate the cross marketing of our products and
services.

Our primary businesses, other than Intellesale.com (formerly Inteletek,
Inc.) and the Non-Core Business Group, are now organized into five business
divisions:

o Telecommunications -- offers a wide range of communications services
including interconnect and computer telephony integration, flat rate
extended calling area service for commercial and residential accounts,

9
<PAGE>

commercial long distance toll service, toll free service, call centers, one
number dialing, voice messaging and commercial long distance calling cards.

o Network Infrastructure -- provides personal computer network infrastructure
for the development of local and wide area networks as well as site
analysis, configuration proposals, training and customer support services.

o Internet -- is focused on developing electronic commerce sites for
businesses and providing internet access services to customers of our other
divisions.

o Communications Infrastructure -- provides specialty communications
contracting services. It is involved in the fabrication, installation, and
maintenance of microwave, cellular and digital personal communication
services (PCS) towers and the construction and installation of fiber optic,
voice/data communications and switchgear systems. The division also
provides complete installation, service and maintenance of power
distribution systems such as lighting, standby power, alarms, security,
video systems, voice/data, network infrastructure and the installation of
fiber optics within customer premises. The Communications Infrastructure
division has secured contracts and provided services for national accounts
such as Sprint, AT&T Wireless, GTE, MCI WorldCom, Wiltel and Pacific Bell.

o Application Technology-- provides software applications for data
acquisition, asset management and decision support systems and develops
programs for portable data collection equipment, including wireless
hand-held devices. Its Flex Connect System links corporate systems to
laptops, PDA's, handheld terminals and other mobile devices via wireless or
wireline connections. It is also involved in the design, manufacture and
support of satellite communication technology including satellite modems,
data broadcast receivers and wireless global positioning systems for
commercial and military applications. In addition, the division develops
and markets peripheral enhancement software that creates a user-friendly
environment for sending faxes, email and scanning, copying and managing
documents on a desktop computer with a multi-function peripheral device.
Integration of these capabilities into a single multifunction program is
particularly advantageous to users in small offices, home offices and small
workgroup environments.

As of December 31, 1998, 1997 and 1996, revenues from these divisions
together accounted for 57.0%, 48.8% and 70.1%, respectively, of our total
revenues.

Intellesale.com

Intellesale.com, Inc. (formerly Inteletek, Inc.) provides leasing,
re-marketing, parts-on-demand and consulting services for mainframe, midrange
and PC systems to industrial, commercial and retail organizations. It utilizes
e-commerce and traditional distribution channels to market its products.
Intellesale is also a parts supplier and purchases electronic components and
other scrap for de-manufacturing and reclamation of precious materials, steel,
aluminum and copper.

As of December 31, 1998, 1997 and 1996, revenues from Intellesale accounted
for 29.4%, 38.2% and 10.0%, respectively, of our total revenues.

10
<PAGE>

The Non-Core Business Group

This group is comprised of four individually managed companies whose
businesses are as follows:

o Gavin-Graham Electrical Products is a custom manufacturer of electrical
products, specializing in digital and analog panelboards, switchboards,
motor controls and general control panels. The company also provides custom
manufacturing processes such as shearing, punching, forming, welding,
grinding, painting and assembly of various component structures.

o Ground Effects, Ltd., based in Windsor, Canada, is a certified manufacturer
and tier one supplier of standard and specialized vehicle accessory
products to the automotive industry. The company exports over 80% of the
products it produces to the United States, Mexico, South America, the Far
East and the Middle East.

o Hopper Manufacturing Co., Inc. remanufactures and distributes automotive
parts. This primarily includes alternators, starters, water pumps,
distributors and smog pumps.

o Innovative Vacuum Solutions, Inc. designs, installs and re-manufactures
vacuum systems used in industry.

Cra-Tek Company and C.T. Specialist, Inc., formerly part of this group, are
now part of our Communications Infrastructure division.

As of December 31, 1998, 1997 and 1996, revenues from this business group
accounted for 13.6%, 13.0% and 19.3%, respectively, of our total revenues.

We announced our intention to divest, in the ordinary course of business,
these non-core businesses at such time and on such terms as the board of
directors determines advisable. There can be no assurance that we will divest of
any or all of these businesses or as to the terms of any divestiture
transaction.

11
<PAGE>

SELLING SHAREHOLDERS

The following tables set forth information regarding the ownership of our
Common Stock by the Selling Shareholders and the shares being offered under this
prospectus. We are providing separate tables for each of the registration
statements which we have previously filed, which are being amended by the
amendments of which this prospectus is a part.

We have issued the shares from time to time (a) in various acquisition
transactions, (b) in consideration for services rendered, including services
under employment agreements and employee bonuses, and (c) on exercises of
warrants or options, all as described in the footnotes to the following tables.
The registration of the shares has been effected pursuant to agreements entered
into by us with the Selling Shareholders.

The percentage owned prior to and after the offering reflects the
outstanding common shares at the time of the applicable registration statement.
The amount and percentage owned after the offering assumes the sale of all of
the Common Stock being registered on behalf of the Selling Shareholders.

The following table provides information about the selling shareholders
referred to in Registration Statement No. 333-25431, filed April 18, 1997:

Number of
Ownership Prior to the Shares Offered Ownership After
Selling Shareholder Offering Hereby the Offering
- ----------------------------------------- ---------------------- -------------- ---------------
<S> <C> <C> <C> <C> <C>
Shares % Shares %
------ --- ------ ---
Scott Axon............................... 25,243 * 7,500(1) 17,743 *
Larry Axon............................... 15,000 * 7,500(1) 7,500 *
Baraban Securities....................... 5,665 * 2,919(2) 2,746 *
H. Sherman Burling....................... 36,422(3) * 36,422 0 -
Edward L. Cummings....................... 9,368(2) * 9,368 0 -
Ralph E. Davies.......................... 14,328(4) * 14,328 0 -
Equity Tech LLC.......................... 20,000(5) * 20,000 0 -
Great Bay Technology, Inc................ 505,127 6.63% 100,000(2) 405,127 5.32%
Barry S. Hanburger....................... 9,367(2) * 9,367 0 -
William A. Husa.......................... 3,140 * 3,140 0 -
Mary C. & George H. Walker and John J.
Goebel, Trustees of the George
Herbert Walker Foundation U/A dated
10/19/58............................... 12,250(6) * 12,250 0 -
James Farmsworth......................... 3,200(6) * 3,200 0 -
Morgan Trust U/A dated 1/4/88
Tom Morgan Trustee....................... 3,750(6) * 3,750 0 -
Conrad Von Bibra-Channel................. 7,000(6) * 7,000 0 -
Citizen Auto Stage Company............... 15,000(6) * 15,000 0 -
HOW & CO f/b/o Monsanto
Master Trust........................... 108,800(6) 1.43% 108,800 0 -
Maple Business Consultants............... 42,671 * 30,545(7) 12,126 *
John Martin.............................. 5,000(8) * 5,000 0 -
J. Alexander Securities.................. 2,000(2) * 2,000 0 -
North American Corporate
Consultants............................. 10,000 * 5,000(2) 5,000 *
Reovest.................................. 1,020 * 510(2) 510 *
Marc Sherman ............................ 107,190(9) 1.41% 107,190 0 -
Garrett A. Sullivan ..................... 220,000(10) 2.89% 100,000 120,000 1.58%
Mario Bucca.............................. 41,213(11) * 41,213 0 -

</TABLE>
12
<PAGE>
<TABLE>
<CAPTION>
Number of
Ownership Prior to the Shares Offered Ownership After
Selling Shareholder Offering Hereby the Offering
- ----------------------------------------- ---------------------- -------------- ---------------
Shares % Shares %
------ --- ------ ---
<S> <C> <C> <C> <C> <C>

Oscar A. Morilla......................... 41,213(11) * 41,213 0 -
Louis R. Notte........................... 41,213(11) * 41,213 0 -
Anthony R. Palumbo....................... 41,213(11) * 41,213 0 -
Emerson Crooks........................... 41,213(11) * 41,213 0 -
Ronald M. Kaplan......................... 113,792(12) 1.49% 113,792 0 -
Frank Giacona............................ 45,445(12) * 45,445 0 -
Alan Kaplan.............................. 90,986(12) 1.19% 90,986 0 -
Edelson Technology Partners.............. 139,073(12) 1.83% 139,073 0 -
Stanley O. Hopper........................ 170,149(13) 2.23% 170,149 0 -
Stephen M. Hopper........................ 8,955(13) * 8,955 0 -
Donna W. Pizarro......................... 190,833(14) 2.51% 190,833 0 -
Michael A. Erickson...................... 268,836(15) 3.53% 268,836 0 -
Joel L. Owens............................ 31,917(15) * 31,917 0 -
============= ========= =======
Total 2,488,805 1,918,053 570,752
============= ========= =======
<FN>
- --------------------
(1) Represents shares of Common Stock received in consideration for the
cancellation of a royalty agreement with us pursuant to which the Axons
were to receive 2% of the revenue of our Software Development and
Services Division for a period of ten years. The Axons were the original
owners of Axcom Computer Consultants, our predecessor.
(2) Represents shares of Common Stock received in consideration for services
rendered to us.
(3) Represents shares of Common Stock received in connection with the
purchase by Burling Instruments, Inc., one of our subsidiaries, of its
office and manufacturing facilities.
(4) Represents shares of Common Stock received for acting as a broker in our
acquisition of Hopper Manufacturing Co., Inc. See
footnote 13 below.
(5) Represents shares of Common Stock received pursuant to the acquisition by
Tech-Tools, Inc., one of our subsidiaries, of DataBoss software in August
1995.
(6) Represents shares of Common Stock received in consideration for $600,000
of working capital provided by Kennedy Capital Management, Inc., an
affiliate of such Selling Shareholder, to us in December 1996 and January
and February 1997.
(7) Represents shares of Common Stock received for acting as a broker in our
acquisition of MVAK Technologies, Inc. See footnote
12 below.
(8) Represents shares of Common stock issued as a bonus on January 11, 1996.
Mr. Martin is our employee.
(9) Represents shares of Common Stock received by Mr. Sherman in connection
with the Amendment to Agreement of Sale, dated as of November 13, 1996,
among us, Mr. Sherman and Universal Commodities Corp. ("UCC"). Mr.
Sherman is President of UCC, which is one of our subsidiaries. Mr.
Sherman received 581,818 shares of Common Stock when we purchased 80% of
UCC. Our share registry does not reflect Mr. Sherman as an owner of
record of these shares as of April 17, 1997.
(10) Represents 20,000 shares of Common Stock, "H" warrants to purchase
100,000 shares of Common Stock and "I" warrants to purchase 100,000
shares of Common Stock. The 100,000 shares of Common Stock being offered
hereunder by Mr. Sullivan represent the shares of Common Stock underlying
the "H" warrants. Prior to this offering, Mr. Sullivan owned 28.57% of
the outstanding "H" warrants. Mr. Sullivan is our President and one of
our directors.
(11) Represents shares of Common Stock received pursuant to our acquisition
of an 80% interest in US Electrical Products Corp., effective as of
December 1, 1996.
(12) Represents shares of Common Stock received pursuant to our acquisition of
MVAK Technologies, Inc. effective as of February 1, 1997.
(13) Represents shares of Common Stock received pursuant to our acquisition of
Hopper Manufacturing Co., Inc. effective as of January 1, 1997.
(14) Represents shares of Common Stock received pursuant to the acquisition by
UCC of an 80% interest in Pizarro Re-Marketing, Inc. effective as of
January 1, 1997.
(15) Represents shares of Common Stock received pursuant to the acquisition by
UCC of an 80% interest in Norcom Resources, Inc. effective as of
January 1, 1997.
</FN>
</TABLE>
13
<PAGE>

The following table provides information about the selling shareholders
referred to in Registration Statement No. 333-37713, filed October 10, 1997:

<TABLE>
<CAPTION>
Number of Shares Ownership After
Ownership Prior to the Offered Hereby the Offering if
Selling Shareholder Offering all Shares are
Sold
- --------------------------------------------- ------------------------------------------------------------------
Shares % Shares %
------ --- ------ ---
<S> <C> <C> <C> <C> <C>

James M. Shaver 1,433,600 (1) 7.81% 1,433,600 0 --
Herman J. Valdez 614,400 (1) 3.35% 614,400 0 --
Lee W. Murray 28,800 (2) * 28,800 0 --
Russell S. Gardner, III 28,800 (2) * 28,800 0 --
Livingston Davies 158,272 (3) * 158,272 0 --
Livingston Davies Irrevocable Trust 78,713 (3) * 78,713 0 --
John H. Knowles, Jr. 87,459 (3) * 87,459 0 --
Timothy Hilton--Knowles Minority Trust 10,344 (3) * 10,344 0 --
Jospeh Dillon Knowles Minority Trust 10,344 (3) * 10,344 0 --
Cameron LaCroix Knowles Minority Trust 10,344 (3) * 10,344 0 --
Andor Co., Ltd. 355,477 (3) 1.94% 355,477 0 --
Robin James Smith-Saville 231,970 (4) 1.26% 231,970 0 --
Else Meyland Smith 6,058 (4) * 6,058 0 --
Lawrence Jan Martin Smith 9,086 (4) * 9,086 0 --
Susan Mary Smith 9,086 (4) * 9,086 0 --
Stephen Kingsley Barton 2,844 (4) * 2,844 0 --
Managed Technology Investors 160,705 (4) * 160,705 0 --
Geoffrey John Walker 37,231 (4) * 37,231 0 --
Peter Martin Terrell 6,058 (4) * 6,058 0 --
Melvin Barmat 948 (4) * 948 0 --
Robin Bernard Michaelson 11,934 (4) * 11,934 0 --
D. J. Davis 2,226 (5) * 2,226 0 --
Kevin O'Keefe & Associates 10,016 (5) * 10,016 0 --
Lora R. Steinmann 800,080 (6) 4.36% 800,080 0 --
E. Kurt Steinmann 109,760 (6) * 109,760 0 --
Dolores L. Franco 30,800 (6) * 30,800 0 --
Eric J. Steinmann 123,840 (6) * 123,840 0 --
Lance J. Umbertis 149,040 (6) * 149,040 0 --
Josef M. Steinman 149,040 (6) * 149,040 0 --
Lohr N. Bangle 9,200 (6) * 9,200 0 --
Robert A. Bospflug 17,040 (6) * 17,040 0 --
Scott A. Capistrano 10,000 (6) * 10,000 0 --
Andrea L. Downs 6,240 (6) * 6,240 0 --
Craig C. Gibble 16,720 (6) * 16,720 0 --
Pamela L. Pittman 27,200 (6) * 27,200 0 --
Gaylord S. Poiry 6,000 (6) * 6,000 0 --
Victor S. Ahern 16,240 (6) * 16,240 0 --
Arie W. Bos 13,040 (6) * 13,040 0 --
Patricia A. Miller 2,160 (6) * 2,160 0 --
Heinz J. Steinmann 18,000 (6) * 18,000 0 --
Lance R. Steinmann 16,800 (6) * 16,800 0 --
Daniel P. Wolfe 9,680 (6) * 9,680 0 --
Randy C. Zachary 6,000 (6) * 6,000 0 --
STC Netcom, Inc. Employees' Trust 63,120 (6) * 63,120 0 --
William A. Forkner 35,000 (7) * 35,000 0 --
William A. Husa 35,000 (7) * 35,000 0 --
Karen Clement 1,000 (8) * 1,000 0 --
John Kunish 20,000 (9) * 20,000 0 --
John McCarthy 20,000 (9) * 20,000 0 --
Kay E. Langsford 5,000 (9) * 5,000 0 --

</TABLE>

14
<PAGE>

<TABLE>
<CAPTION>
Number of Shares Ownership After
Ownership Prior to the Offered Hereby the Offering if
Selling Shareholder Offering all Shares are
Sold
- --------------------------------------------- ----------------------------------------------------------------
Shares % Shares %
------ --- ------ ---
<S> <C> <C> <C> <C> <C>

Andrew Werdeman 2,000 (9) * 2,000 0 --
Phillip Tranbarger 5,000 (9) * 5,000 0 --
Richard J. Sullivan 1,848,374 (9)(10) 10.06% 891,374 957,000 5.21%
Garrett A. Sullivan 370,000 (9)(11) 2.01% 120,000 250,000 1.36%
John Beasley 10,503 (12) * 10,503 0 --
J. Alexander Securities, Inc. 1,000 (13) * 1,000 0 --
North American Corporate Consultants 500 (13) * 500 0 --
Reovest, Inc. 121 (13) * 121 0 --
Hayden, Buczeck & Associates 8,000 (13) * 8,000 0 --
Merra, Kanakis, Creme & Mellor, P.C. 940 (13) * 940 0 --
Ira Miller & Co. 62,500 (13) * 62,500 0 --
Scott Kelly 12,500 (13) * 12,500 0 --
Vincent F. & Kim N. Lo Castro, Joint
Tenants 550,000 (14) 2.99% 550,000 0 --
The Bruce Reale Revocable Trust dated
8/1/90, Bruce Reale & The Reale
Family Limited Partnership 1,282,966 (15) 6.99% 1,256,240 26,726 *
Scott R. Silverman 101,240 (16) * 101,240 0 --
David A. Loppert 100,000 (17) * 100,000 0 --
Marc Sherman 423,480 (18) 2.31% 23,480 400,000 2.18%
Daniel E. Penni 81,865 (19) * 45,000 36,865 *
Angela M. Sullivan 5,000 (20)(21) * 5,000 0 --
Arthur F. Noterman 5,000 (20) * 5,000 0 --
Capital Alliance Corp. 159,695 (22) * 94,167 65,528 *
Rigo Felix 6,726 (23) * 6,726 0 --
Gary A. Gray 140,000 (24) * 100,000 40,000 *
Attkisson, Carter & Akers 200,000 (25) 1.09% 200,000 0 --
Dominick & Dominick 250,000 (26) 1.36% 250,000 0 --
Lokken, Chesnut and Cape 248,500 (27) 1.35% 125,000 123,500 *
Sherri Sheerr 158,351 (28) * 158,351 0 --
Harvey H. Newman 235,547 (29) 1.28% 235,547 0 --
Martin D. Zuckerman 226,309 (29) 1.23% 226,309 0 --
Edward L. Cummings 22,858 (30) * 13,490 9,368 *
Charles Newman 5,000 (31) * 5,000 0 --
James Folts 5,173 (32) * 5,173 0 --
Mark Crowley 6,181 (32) * 6,181 0 --
Mark Gilles 863 (32) * 863 0 --
David Hagedorn 432 (32) * 432 0 --
Todd S. Larchuk 691 (32) * 691 0 --
Vincent Ravo 6,181 (32) * 6,181 0 --
Matthew Runo 518 (32) * 518 0 --
Edelson Technology Partners II 325,051 (32) 1.77% 325,051 0 --
4C Ventures 81,490 (32) * 81,490 0 --
RH Investment Group No. 1 5,563 (32) * 5,563 0 --
Michael Epstein 15,520 (32) * 15,520 0 --
Roger Miller 15,198 (32) * 15,198 0 --
Ian G. Miller Trust 976 (32) * 976 0 --
Helen E. Miller Trust 247 (32) * 247 0 --
Lee Katherine Miller Trust 247 (32) * 247 0 --
Charles W. Miller Trust 247 (32) * 247 0 --
Nicholas J. Miller Trust 247 (32) * 247 0 --
Ludwig Kapp 43,379 (32) * 43,379 0 --
Charitable Lead Trust 7,858 (32) * 7,858 0 --
Dorothy E. Pattee 15,717 (32) * 15,717 0 --
Douglas Kemmerer 345 (32) * 345 0 --

</TABLE>

15
<PAGE>

Bonnie Jennings 3 (32) * 3 0 --
Scott Cusins 43 (32) * 43 0 --
Tara Mezzanotte 3 (32) * 3 0 --
Tracy Mocha 130 (32) * 130 0 --
Ron Williamson 9 (32) * 9 0 --
John F. Reap 26,176 (32) * 26,176 0 --
Edward Feldman 20,352 (32) * 20,352 0 --
Elizabeth B. & Donald C. Lennox, Joint
Tenants 20,296 (32) * 20,296 0 --
George S. & Carol C. Anton, Joint Tenants 7,235 (32) * 7,235 0 --
Suzann E. & Michael S. Nielsen, Joint
Tenants 1,624 (32) * 1,624 0 --
Brian J. & Jeanne K. Daly, Joint Tenants 8,454 (32) * 8,454 0 --
William H. McEvoy 377 (32) * 377 0 --
Robert W. Long 449 (32) * 449 0 --
Scott Bartolett 4,134 (32) * 4,134 0 --
Jo Ann & Anthony J. Nicoletti, Joint
Tenants 17 (32) * 17 0 --
Claire L. & Thomas A. Frew, Joint Tenants 9 (32) * 9 0 --
Debora Adams 267 (32) * 267 0 --
Alice Christensen 259 (32) * 259 0 --
Karen L. Murphy 267 (32) * 267 0 --
David Shafer 267 (32) * 267 0 --
Kevin M. Stewart 210 (32) * 210 0 --
Donald P. Proefrock 25 (32) * 25 0 --
Albert V. & Diane J. Narusberg, Joint
Tenants 25 (32) * 25 0 --
Ronald M. Kaplan 18,204 (33) * 18,204 0 --
CoreStates Bank, N.A. 240,265 (34) 1.31% 240,265 0 --
---------- ---------- ---------
Total 12,425,914 10,516,927 1,908,987
========== ========== =========
<FN>
* Represents ownership of less than one percent.
(1) Represents shares of Common Stock received pursuant to our acquisition of
an 80% interest in Advanced Telecommunications, Inc., effective as of
April 1, 1997.
(2) Represents shares of Common Stock received pursuant to our acquisition
of a 100% interest in DLS Service Corporation., effective as of July 1,
1997.
(3) Represents shares of Common Stock received pursuant to our acquisition of
a 100% interest in Intermatica, Inc., effective as of June 30, 1997.
(4) Represents shares of Common Stock received pursuant to our acquisition of
an 80% interest in Signal Processors, Ltd., effective as of April 1,
1997.
(5) Represents shares of Common Stock for acting as a broker in our
acquisition of Signal Processors, Ltd.
(6) Represents shares of Common Stock received pursuant to our acquisition of
an 80% interest in STC Netcom, Inc., effective as of July 1, 1997.
(7) Represents shares of Common Stock for acting as a broker i n our
acquisition of STC Netcom, Inc.
(8) Represents shares of Common Stock issued as a bonus on March 3, 1997.
Ms. Clement is an employee of one of our subsidiaries.
(9) Represents shares of Common Stock issued as a bonus to certain of our
employees or those of our subsidiaries on January 11, 1996.

16
<PAGE>
(10) Includes (a) 50,000 shares of Common Stock issued as a bonus to certain
of our employees or those of our subsidiaries on January 11, 1996, (b)
48,109 shares of Common Stock received pursuant to an employment
agreement between us and Mr. Sullivan in lieu of cash compensation for
the year beginning June 1, 1997, (c) 193,265 shares of Common Stock
issued to The Bay Group, Inc. for services rendered, and (d) 600,000
shares issuable on exercise (at a purchase price of $3.00 per share) of
Class N Warrants issued to Great Bay Technology, Inc. in 1997, in
consideration for its agreement to exercise certain previously-issued
warrants. The Bay Group is owned by Richard J. Sullivan and Angela M.
Sullivan, one of our Directors. Richard J. Sullivan, Angela M. Sullivan
and Stephanie Sullivan are the controlling shareholders of Great Bay
Technology, Inc.
(11) Includes (a) 20,000 shares of Common Stock issued as a bonus to certain
of our employees or those of our subsidiaries on January 11, 1996, (b)
100,000 shares of Common Stock issuable on exercise (at a purchase price
of $3.00 per share) of Class N Warrants issued to Mr. Sullivan in 1997,
in consideration for his agreement to exercise certain previously-issued
warrants.
(12) Represents shares of Common Stock received pursuant to an Employment
Agreement between us, our subsidiary, Atlantic Systems, Inc., and Mr.
Beasley. Mr. Beasley is an employee of Atlantic Systems, Inc.
(13) Represents shares of Common Stock received in consideration for services
rendered to us.
(14) Represents 650,000 shares of Common Stock received in exchange for 48,000
shares of our Redeemable Preferred Stock. Shortly after receiving the
shares of Common Stock, Mr. & Mrs. Lo Castro exchanged 100,000 of these
restricted shares of Common Stock for 100,000 shares of registered Common
Stock with The Reale Family Limited Partnership (see 15 below).
(15) Includes (a) 676,726 shares owned by The Bruce Reale Revocable Trust
dated 8/1/90, (b) 100,000 shares owned by The Reale Family Limited
Partnership, (c) 26,240 shares owned by Bruce Reale and (d) 480,000
shares of Common Stock issuable on exercise (at a purchase price of $3.00
per share) of Class P Warrants issued to The Bruce Reale Revocable Trust
in 1997, in consideration for his agreement to exercise certain
previously-issued warrants.
(16) Represents (a) 75,000 shares of Common Stock purchased from us on June
23, 1997 under a note purchase agreement, and (b) 26,240 shares of Common
Stock received for acting as a broker in our acquisition of Advanced
Telecommunications, Inc. Mr. Silverman is an officer of one of our
subsidiaries.
(17) Represents shares of Common Stock purchased from us on May 9, 1997
under a note purchase agreement. Mr. Loppert is our Vice President,
Treasurer and Chief Financial Officer.
(18) Includes (a) 9,990 shares of Common Stock received by Mr. Sherman in
connection with an Amendment to Agreement of Sale dated as of September
30, 1997, among us, Mr. Sherman and Universal Commodities Corp. ("UCC").
Mr. Sherman is President of UCC, one of our subsidiaries; (b) 4,443
shares of Common Stock as a finders fee in connection with UCC's
acquisition of Cybertech Station, Inc. (see note 29 below); and (c) 9,047
shares of Common Stock as a finders fee in connection with UCC's
acquisition of PPL, Ltd (see note 30 below). Mr. Sherman received 581,818
shares of Common Stock when we purchased 80% of UCC. Our share registry
does not reflect Mr. Sherman as an owner of record of these shares as of
November 12, 1997. As of November 12, 1997, Mr.
Sherman has represented that he beneficially owns 423,480 shares of
Common Stock.
(19) Represents (a) 5,000 shares of Common Stock received for services
rendered as one of our Directors, (b) 30,000 shares for prior services
rendered to us for the period from 1995 - 1997, and (c) 10,000 shares for
the conversion of a loan to us.
(20) Represents shares of Common Stock received for services rendered as one
of our Directors. (21) Ms. Sullivan is married to Richard J. Sullivan,
our Chairman and Chief Executive Officer.
(22) Includes 54,167 shares of Common Stock received in exchange for 4,000
shares of our Redeemable Preferred Stock and 40,000 shares of Common
Stock issuable on exercise (at a purchase price of $3.00 per share) of
Class P Warrants issued to Capital Alliance Corp. in 1997, in
consideration for its agreement to exercise certain previously-issued
warrants.
(23) Represents 6,726 shares of Common Stock received in exchange for 21,158
shares of common stock in Cra-Tek Company. Effective as of August 1,
1996, we purchased 80.1% of the outstanding common shares of Cra-Tek
Company and has an option to acquire the remaining 19.9%. The 21,158
shares acquired represents an additional 1.8% of Cra-Tek's outstanding
shares.
(24) Represents shares of Common Stock issuable on exercise (at a purchase
price of $3.00 per share) of Class N Warrants issued to Mr. Gray in 1997,
in consideration for his agreement to exercise certain previously-issued
warrants.
(25) Represents shares of Common Stock issuable on exercise (at a purchase
price of $3.00 per share) of Class O Warrants issued to Attkisson, Carter
& Akers in 1997 in consideration for investment banking services and
assisting us in private placements of warrants.
(26) Represents shares of Common Stock issuable on exercise (at a purchase
price of $8.375 per share) of Class Q Warrants issued to Dominick &
Dominick in 1997, in consideration for its agreement to exercise certain
previously-issued warrants.

17
<PAGE>
(27) Includes 125,000 shares of Common Stock issuable on exercise (at a
purchase price of $8.375 per share) of Class R Warrants issued to Lokken,
Chesnut & Cape in 1997, in consideration for its agreement to exercise
certain previously-issued warrants.
(28) Represents shares of Common Stock received pursuant to our subsidiary,
UCC's, acquisition of an 80% interest in Cybertech Station, Inc.,
effective as of July 1, 1997.
(29) Represents shares of Common Stock received pursuant to our subsidiary,
UCC's, acquisition of an 80% interest in PPL, Ltd., effective as of July
1, 1997.
(30) Includes (a) 4,444 shares of Common Stock as a finders fee in connection
with UCC's acquisition of Cybertech Station, Inc.; and (b) 9,046 shares
as a finders fee in connection with UCC's acquisition of PPL. Ltd.
(31) Represents shares of Common Stock as a finders fee in connection with
UCC's acquisition of PPL. Ltd.
(32) Represents shares of Common Stock received pursuant to our acquisition of
a 100% interest in Alacrity Systems, Inc., effective as of October 1,
1997.
(33) Represents shares of Common Stock as a finders fee in connection with our
acquisition of Alacrity Systems, Inc.
(34) Represents shares of Common Stock issuable on exercise (at a purchase
Price of $6.00 per share) of Class S Warrants issued to CoreStates Bank,
N.A. in October, 1997 as collateral for a loan to one of our
subsidiaries.
</FN>
</TABLE>
The following table provides information about the selling shareholders
referred to in Registration Statement No. 333-45139, filed January 28, 1998:
<TABLE>
<CAPTION>
Number of Shares Ownership After
Ownership Prior to the Offered Hereby the Offering if
Selling Shareholder Offering all Shares are
Sold
- --------------------------------------------- ------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Shares % Shares %
------ --- ------ ---
Howes Family Trust U/T/A dated 7/13/92 692,694 (1) 3.26% 692,694 0 --
Heather E. Howes 4,318 (1) * 4,318 0 --
Dylan D. Howes 4,318 (1) * 4,318 0 --
Ralph E. Davies 71,432 (2)(3) * 56,280 15,152 *
Roger W. Miller 24,325 (4)(5) * 1,497 22,828 *
CCF/Cannet, LP 325,072 (4) 1.53% 325,072 0 --
Telus Co., Inc. 187,226 (4) * 187,226 0 --
Montague Guild Residuary Trust 35,839 (4) * 35,839 0 --
Robert E. LaBlanc Associates, Inc. 28,473 (4) * 28,473 0 --
Bruce E. Cooperman 72,230 (4) * 72,230 0 --
William M. Simpson 13,609 (4) * 13,609 0 --
--------- --------- ------
Total 1,459,536 1,421,556 37,980
========= ========= ======
<FN>
* Represents ownership of less than one percent.
(1) Represents shares of Common Stock received pursuant to our acquisition
of a 100% interest in C.T. Specialists, Inc., effective as of October 1,
1997.
(2) Represents shares of Common Stock received from the Howes Family Trust as a
finders fee in connection with the sale of the Howes Family Trust's
interest in C.T. Specialists, Inc. to us.
(3) After this offering, Mr. Davies will own 15,152 shares of Common Stock,
representing ownership of less than one percent.
(4) Represents shares of Common Stock received pursuant to our acquisition
of a 100% interest in Canadian Network Services, Inc., effective as of
October 1, 1997. These shares, totaling 663,946 in the aggregate,
represent 51.28% of the 1,294,673 total shares issued by us in connection
with its 100% acquisition of Canadian Network Services, Inc.
(5) After this offering, Mr. Miller will own 22,828 shares of Common Stock,
representing ownership of less than one percent.
</FN>
</TABLE>

The following table provides information about the selling shareholders
referred to in Registration Statement No. 333-51067, filed April 27, 1998:

Sherri Sheerr 195,284 * 36,933 (1) 158,351 *
Harvey H. Newman 256,872 * 21,325 (2) 235,547 *
Martin D. Zuckerman 246,797 * 20,488 (2) 226,309 *

</TABLE>
18
<PAGE>

<TABLE>
<CAPTION>
Ownership After The
Ownership Prior to The Number of Shares Offering if all
Selling Shareholder Offering Offered Hereby Shares are Sold
- ------------------------------------------ ------------------------- --------------------- ---------------------
Shares % Shares %
------ --- ------ ---
<S> <C> <C> <C> <C> <C>
Edward L. Cummings 49,200 * 21,221 (3) 27,979 *
Marc Sherman 478,918 1.69% 184,117 (4) 294,801 1.04%
Charles Newman 10,453 * 5,453 (5) 5,000 *
Barry S. Hanburger 5,000 * 5,000 (6) 0 --
Michael Stalteri, Jr. 500 * 500 (6) 0 --
Edelson Technology Partners II, LP 948,274 3.35% 623,223 (7) 325,051 1.15%
James Folts 2,597 * 2,597 (8) 0 --
Mark Crowley 9,284 * 3,103 (8) 6,181 *
Mark Gilles 1,297 * 434 (8) 863 *
David Hagedorn 648 * 216 (8) 432 *
Todd S. Larchuk 1,038 * 347 (8) 691 *
Vincent Ravo 9,284 * 3,103 (8) 6,181 *
Matthew Runo 778 * 260 (8) 518 *
4C Ventures 122,400 * 40,910 (8) 81,490 *
RH Investment Group No. 1 8,356 * 2,793 (8) 5,563 *
Michael Epstein 23,311 * 7,791 (8) 15,520 *
Roger W. Miller 24,325 * 7,630 (8) 16,695 *
Ian G. Miller Trust 1,465 * 489 (8) 976 *
Helen E. Miller Trust 371 * 124 (8) 247 *
Lee Katherine Miller Trust 371 * 124 (8) 247 *
Charles W. Miller Trust 371 * 124 (8) 247 *
Nicholas J. Miller Trust 371 * 124 (8) 247 *
Ludwig Kapp 65,156 * 21,777 (8) 43,379 *
Gordon B. Pattee 5,900 * 1,970 (8) 3,930 *
Anne L. Pattee 5,903 * 1,975 (8) 3,928 *
Dorothy E. Pattee 23,607 * 7,890 (8) 15,717 *
Douglas Kemmerer 519 * 174 (8) 345 *
Bonnie Jennings 4 * 1 (8) 3 *
Scott Cusins 65 * 22 (8) 43 *
Tara Mezzanotte 5 * 2 (8) 3 *
Tracy Mocha 195 * 65 (8) 130 *
Ron Williamson 13 * 4 (8) 9 *
John F. Reap 26,316 * 13,140 (8) 13,176 *
Edward Feldman 30,569 * 10,217 (8) 20,352 *
Elizabeth B. & Dean C. Lennox, Joint Tenants 30,484 * 10,188 (8) 20,296 *
George S. & Carol C. Anton, Joint Tenants 10,867 * 3,632 (8) 7,235 *
Suzann E. & Michael S. Nielsen, Joint Tenants 2,440 * 816 (8) 1,624 *
Brian J. & Jeanne K. Daly, Joint Tenants 12,697 * 4,243 (8) 8,454 *
William H. McEvoy 566 * 189 (8) 377 *
Robert W. Long 674 * 225 (8) 449 *
Scott Bartolett 6,209 * 2,075 (8) 4,134 *
Jo Ann & Anthony J. Nicoletti, Joint Tenants 26 * 9 (8) 17 *
Claire L. & Thomas A. Frew, Joint Tenants 13 * 4 (8) 9 *
Debora Adams 401 * 134 (8) 267 *
Alice Christensen 389 * 130 (8) 259 *
Karen L. Murphy 401 * 134 (8) 267 *
David Schafer 401 * 134 (8) 267 *
Kevin M. Stewart 316 * 106 (8) 210 *

</TABLE>

19
<PAGE>

Donald P. Proefrock 38 * 13 (8) 25 *
Albert V. & Diane J. Narusberg, Joint
Tenants 38 * 13 (8) 25 *
Michael S. Andison 56,248 * 56,248 (9) 0 --
James G. Knight 56,248 * 56,248 (9) 0 --
Georges H. Roy 56,248 * 56,248 (9) 0 --
M.L. Carole Boisvert 517 * 517 (9) 0 --
Johna L. Giraldi 517 * 517 (9) 0 --
J. Daniel Grondin 517 * 517 (9) 0 --
Edward Lorinz 388 * 388 (9) 0 --
Ronald M. Kaplan 61,867 * 43,663 (10) 18,204 *
Sanne Trust Company Limited as Trustee of
the Smith Trust 663,656 2.34% 657,598 (11) 6,058 *
Melvin Barmat 2,619 * 2,619 (11) 0 --
Stephen Kinglsey Barton 3,060 * 3,060 (11) 0 --
Lawrence Jan Martin Smith 15,863 * 9,777 (11) 6,086 *
Susan Mary Smith 15,863 * 9,777 (11) 6,086 *
MTI Nominees, Ltd. 333,623 1.18% 172,918 (11) 160,705 *
Geoffrey John Walker 77,291 * 40,060 (11) 37,231 *
Peter Martin Terrell 12,576 * 6,518 (11) 6,058 *
Robert Bernard Michaelson 24,774 * 12,840 (11) 11,934 *
D. J. Davis 2,386 * 2,386 (12) 0 --
R. Kevin O'Keefe 10,740 * 10,740 (12) 0 --
Andrew Hidalgo 1,000 * 1,000 (13) 0 --
Larry Wasielewski 41,000 * 10,000 (14) 31,000 *
Gary A. Gray 30,900 * 10,000 (15) 20,900 *
Hayden, Buczek & Associates 23,500 * 15,500 (16) 8,000 *
Merra, Kanakis, Creme &
Mellor, PC. 2,955 * 2,015 (16) 940 *
Dana Barbera 1,663 * 1,663 (16) 0 --
Markus W. Pope 1,263 * 1,263 (16) 0 --
Andrew B. Werderman 376 * 376 (16) 0 --
Roger Nation 1,000 * 1,000 (16) 0 --
John Beasley 4,462 * 4,462 (16) 0 --
Ralph E. Davies 71,432 * 15,152 (17) 56,280 *
William A. Husa 15,152 * 15,152 (17) 0 --
Michael A. Erickson 229,017 * 76,281 (18) 152,736 *
Joel L. Owens 7,467 * 7,467 (19) 0 --
James A. Fath 667 * 667 (20) 0 --
Robert A. Buchanan 222 * 222 (20) 0 --
Jamie P. Owens 667 * 667 (20) 0 --
Jeanne M. Lechner 667 * 667 (20) 0 --
Donna W. Pizarro 168,556 * 42,723 (21) 125,833 *
John K. Murray 485,651 1.71% 100,000 (22) 385,651 1.36%
Anat Ebenstein 22,075 * 22,075 (23) 0 --
Sidney Karp 22,075 * 22,075 (23) 0 --
Capital Alliance Corporation 127,770 * 22,075 (23) 105,695 *
David C. Gerber 845,364 3.98% 845,364 (24) 0 --
Toby J. Quesinberry 339,427 1.20% 339,427 (24) 0 --
Albert F. Butters, Jr. 230,554 * 230,554 (24) 0 --

</TABLE>

20
<PAGE>

James R. Millerberg 143,456 * 143,456 (24) 0 --
William A. Forkner 37,857 * 37,857 (25) 0 --
Erich Nigl 25,000 * 25,000 (26) 0 --
Carl C. Saracino 10,000 * 10,000 (26) 0 --
Paul Pappas 193,939 * 193,939 (27) 0 --
Maple Business Consultants, Inc. 9,697 * 9,697 (28) 0 --
Great Bay Technology, Inc. 970,127 3.42% 600,000 (29) 370,127 1.31%
The Bay Group 294,614 1.04% 101,349 (30) 193,265 *
I. W. Miller & Co., Inc. 50,000 * 50,000 (31) 0 --
Scott Kelley 12,500 * 12,500 (31) 0 --
============= ============== =============
Total 8,438,850 5,181,995 3,256,855
============= ============== =============
- --------------
<FN>
* Represents ownership of less than one percent.
(1) Includes (a) 14,335 shares of Common Stock received pursuant to the
"price protection" provision in the Agreement of Sale in connection with
the acquisition by Universal Commodities Corp., one of our subsidiaries,
of an 80% interest in Cybertech Station, Inc.; and (b) 22,598 shares of
Common Stock received pursuant to the "earnout" provision in the
Agreement of Sale among us, the Selling Shareholder and Cybertech
Station, Inc.
(2) Represents shares of Common Stock received pursuant to the "price
protection" provision in the Agreement of Sale in connection with the
acquisition by Universal Commodities Corp., one of our subsidiaries, of
an 80% interest in PPL, Ltd.
(3) Includes (a) 1,221 additional shares of Common Stock received as a
finder's fee pursuant to the "price protection" provisions in the
Agreements of Sale in connection with the acquisition by Universal
Commodities Corp., one of our subsidiaries, of 80% interests in Cybertech
Station, Inc. and PPL, Ltd., and (b) 20,000 shares received as a bonus.
(4) Includes (a) 152,896 shares received pursuant to the deferred "earnout"
provision in the Agreement of Sale in connection with our acquisition of
an 80% interest in Universal Commodities Corp. in 1996, (b) 1,221
additional shares of Common Stock received as a finder's fee pursuant to
the "price protection" provisions in the Agreements of Sale in connection
with the acquisition by Universal Commodities Corp., one of our
subsidiaries, of 80% interests in Cybertech Station, Inc. and PPL, Ltd.,
and (c) 30,000 shares received as a bonus. Mr. Sherman is President of
Universal Commodities Corp.
(5) Includes (a) 453 additional shares of Common Stock received as a finder's
fee pursuant to the "price protection" provisions in the Agreement of
Sale in connection with the acquisition by Universal Commodities Corp.,
one of our subsidiaries, of an 80% interest in PPL, Ltd., and (b) 5,000
shares received as a bonus.
(6) Represents shares of common stock received as a bonus.
(7) Includes (a) 163,179 shares of Common Stock received pursuant to the
"price protection" provision in the Agreement of Sale in connection with
our acquisition of a 100% interest in Alacrity Systems, Inc., and (b)
460,044 shares of Common Stock received pursuant to our acquisition of an
88.82% interest in Canadian Network Services, Inc., effective as of
October 1, 1997.
(8) Represents additional shares of Common Stock received pursuant to the
"price protection" provision in the Agreement of Sale in connection with
our acquisition of a 100% interest in Alacrity Systems, Inc.
(9) Represents shares of Common Stock received pursuant to our acquisition
of the remaining 11.18% interest in Canadian Network Services, Inc.,
effective as of January 1, 1998.
(10) Represents (a) 9,138 additional shares of Common Stock received as a
finder's fee pursuant to the "price protection" provisions in the
Agreement of Sale in connection with our acquisition of a 100% interest
in Alacrity Systems, Inc., and (b) 34,525 shares of Common Stock received
as a finder's fee pursuant to our acquisition of a 100% interest in
Canadian Network Services, Inc.
(11) Represents additional shares of Common Stock received pursuant to the
"earnout" provision in the Agreement of Sale among us, the Selling
Shareholders and Signal Processors Limited.
(12) Represents additional shares of Common Stock received as a finder's fee
pursuant to the "earnout" provision in the Agreement of Sale among us,
the Selling Shareholders and Signal Processors Limited.
(13) Represents shares of Common Stock received pursuant to Mr. Hidalgo's
employment agreement with our subsidiary, Alacrity Systems, Inc.
(14) Represents shares of Common Stock received pursuant to Mr. Wasielewski's
employment agreement with our subsidiary, ACT Automotive Group, Inc.
(15) Represent shares of Common Stock received as additional compensation in
connection with Mr. Gray's appointment as president of our subsidiary,
Atlantic Systems, Inc.

21
<PAGE>

(16) Represents shares of Common Stock received for services rendered.
(17) Represents shares of Common Stock received as a finder's fee in
connection with our acquisition of a 100% interest in C.T. Specialists,
Inc. in 1997.
(18) Includes (a) 67,200 additional shares of Common Stock received pursuant
to the "earnout" provision in the Agreement of Sale among us, the Selling
Shareholders and Norcom Resources, Inc., and (b) 9,081 shares received
pursuant to the bonus provision in Mr. Erickson's employment agreement,
after allocating 2,223 of such shares to employees of Norcom Resources,
Inc.
(19) Represents shares of Common Stock received pursuant to the "earnout"
provision in the Agreement of Sale among us, the Selling
Shareholders and Norcom Resources, Inc., Inc.
(20) Represents shares of Common Stock received from Michael Erickson as a
bonus - see Note 17 above.
(21) Represents shares of Common Stock received pursuant to the "earnout"
provision in the Agreement of Sale among us, the Selling Shareholder and
Pizarro Re-Marketing, Inc.
(22) Represents 100,000 shares out of a total of 485,651 shares of Common
Stock received pursuant to our acquisition of 100% of the outstanding
common stock of Information Products Center, Inc., effective as of
January 1, 1998.
(23) Represents shares of Common Stock received pursuant to our acquisition
of 100% of the outstanding common stock of Information Products Center,
Inc., effective as of January 1, 1998.
(24) Represents shares of Common Stock received pursuant to our acquisition of
100% of the outstanding common stock of The Fromehill Company effective
as of January 1, 1998.
(25) Represents shares of Common Stock received as a finder's fee pursuant to
our acquisition of 100% of the outstanding common stock of The
Fromehill Company, effective as of January 1, 1998.
(26) Represents shares of Common Stock received pursuant to the acquisition by
Universal Commodities Corp., one of our subsidiaries, of 80% of the
outstanding common stock of Service Transport Company, effective as of
April 1, 1998.
(27) Represents shares of Common Stock received pursuant to the acquisition by
Universal Commodities Corp., one of our subsidiaries, of 80% of the
outstanding common stock of Blue Star Electronics, Inc., effective as of
April 1, 1998.
(28) Represents shares of Common Stock received as a finder's fee pursuant to
the acquisition by Universal Commodities Corp., one of our subsidiaries,
of 80% of the outstanding common stock of Blue Star Electronics, Inc.,
effective as of April 1, 1998.
(29) Represents shares of Common Stock underlying Class S warrants issued to
Great Bay Technology, Inc. ("Great Bay") at an exercise price of $2.00
per share in consideration for Great Bay having exercised its N warrants
at an exercise price of $2.00 per share. Great Bay is controlled by
Richard J. Sullivan, our Chairman and Chief Executive Officer.
(30) Represents shares of Common Stock issued to The Bay Group in connection
with investment banking services in regard to our acquisition of CT
Specialists, Inc., Canadian Network Services, Inc., Information Products
Center, Inc. and The Fromehill Company. The Bay Group is controlled by
Richard J. Sullivan, our Chairman and Chief Executive Officer.
(31) Represents shares of Common Stock issueable under the terms of an
Agreement for Mergers and Acquisition Services to be provided by the I.W.
Miller Company to us during 1998. Additionally, 62,500 shares of Common
Stock will be issued in December 1998 under the terms of the agreement.
</FN>
</TABLE>

The following table provides information about the selling shareholders
referred to in Registration Statement No. 333-64755, filed September 30, 1998:

<TABLE>
<CAPTION>
Ownership After The
Ownership Prior to Number of Shares Offering if all Shares
Selling Shareholder The Offering Offered Hereby are Sold
- -----------------------------------------------------------------------------------------------------------
Shares % Shares %
-------------- ----- ------------- -------
<S> <C> <C> <C> <C> <C>
Kerry G. Burst 362,500 * 362,500 (1) 0 --
Lance J. Umbertis 3,222 * 3,222 (2) 0 --
Eric J. Steinmann 90,620 * 2,820 (2) 87,800 *
Scott A. Capistrano 1,208 * 1,208 (2) 0 --
John Dixson 806 * 806 (2) 0 --
Amherst Systems, Inc. 66,667 * 66,667 (3) 0 --
Bradley A. Haslett 538,462 1.4% 538,462 (4) 0 --
James S. Bosshart 538,461 1.4% 538,461 (4) 0 --
William A. Forkner 63,067 * 25,210 (5) 37,857 *
Scott R. Silverman 70,884 * 22,069 (6) 48,815 *
Marc Sherman 616,968 1.6% 131,750 (7) 485,218 1.3%
Edward L. Cummings 80,951 * 31,751 (8) 49,200 *
Michael E. Sham 392,157 1.0% 392,157 (9) 0 --
Sherri Sheerr 226,217 * 30,933 (10) 195,284 *
</TABLE>

22
<PAGE>

Ownership After The
Ownership Prior to Number of Shares Offering if all Shares
Selling Shareholder The Offering Offered Hereby are Sold
- -----------------------------------------------------------------------------------------------------------
Shares % Shares %
-------------- ----- ------------- -------
<S> <C> <C> <C> <C> <C>

Donn J. Wagner 96,154 * 96,154 (11) 0 --
Angela S. Wagner 96,154 * 96,154 (11) 0 --
Edward M. Kelly 96,154 * 96,154 (11) 0 --
Eileen E. Kelly 96,154 * 96,154 (11) 0 --
Joseph S. Keats 3,692 * 3,692 (12) 0 --
Patrick C. Chai 192,308 * 192,308 (13) 0 --
Robert W. Borra 194,808 * 192,308 (13) 2,500 *
Maple Business Consultants, Inc. 9,231 * 9,231 (14) 0 --
Michael Metropolis 90,257 * 90,257 (15) 0 --
Michelle Metropolis 90,256 * 90,256 (15) 0 --
Joseph T. Gabriel 90,256 * 90,256 (15) 0 --
David Cairnie 10,571 * 10,571 (16) 0 --
John Booker 32,115 * 32,115 (16) 0 --
Robin Tyler 32,114 * 32,114 (16) 0 --
Frederick Bassett 7,693 * 7,693 (16) 0 --
Alan Cook 2,501 * 2,501 (16) 0 --
Trevor Gage 2,501 * 2,501 (16) 0 --
Peter Sayles 2,501 * 2,501 (16) 0 --
ECI Ventures Nominees Limited 1,489,821 4.0% 1,489,821 (16) 0 --
Fisher Karpark Holdings PLC 759,886 2.0% 759,886 (16) 0 --
Kevin O'Keeffe and Associates 23,082 * 23,082 (17) 0 --
Frank Lusko 66,552 * 66,552 (18) 0 --
Mark R. Kruger 66,552 * 66,552 (18) 0 --
Strategic Alliance Funding
Equity, Inc. 9,655 * 9,655 (19) 0 --
William A. Husa 3,664 * 3,664 (20) 0 --
Ralph E. Davies 3,664 * 3,664 (20) 0 --
John K. Murray 450,411 1.2% 400,411 (21) 50,000 *
Anat Ebenstein 25,333 * 3,258 (21) 22,075 *
Sidney L. Karp Holding Company, Inc. 25,333 * 3,258 (21) 22,075 *
Capital Alliance Corporation 111,094 * 3,258 (21) 107,836 *
David C. Gerber 961,708 2.6% 116,344 (22) 845,364 2.2%%
Toby J. Quesinberry 386,141 1.0% 46,714 (22) 339,427 *
Albert F. Butters, Jr. 262,284 * 31,730 (22) 230,554 *
James C. Millerberg 163,200 * 19,744 (22) 143,456 *
Edelson Technology Partners II, LP 1,028,341 2.7% 80,067 (23) 948,274 2.5%
Michael S. Andison 66,038 * 9,790 (23) 56,248 *
James G. Knight 66,038 * 9,790 (23) 56,248 *
Georges H. Roy 66,038 * 9,790 (23) 56,248 *
M. L. Carole Boisvert 607 * 90 (23) 517 *
Johna L. Giraldi 607 * 90 (23) 517 *
J. Daniel Grondin 607 * 90 (23) 517 *
Edward Lorinez 455 * 67 (23) 388 *
Paul Pappas 50,467 * 8,728 (24) 41,739 *
James M. Shaver 1,923,509 5.1% 516,409 (25) 1,407,100 3.7%
Herman J. Valdez 873,813 2.3% 259,413 (25) 614,400 1.6%
Richard J. Sullivan 159,249 * 56,140 (26) 103,109 *

</TABLE>
23
<PAGE>
<TABLE>
<CAPTION>
Ownership After The
Ownership Prior to Number of Shares Offering if all Shares
Selling Shareholder The Offering Offered Hereby are Sold
- -----------------------------------------------------------------------------------------------------------
Shares % Shares %
-------------- ----- ------------- -------
<S> <C> <C> <C> <C> <C>
Frank Giacona 8,364 * 8,364 (27) 0 --
The Bay Group 310,598 * 117,333 (28) 193,265 *
Dana M. Barbera 2,803 * 2,803 (29) 0 --
Hayden, Buczek & Associates 10,000 * 10,000 (29) 0 --
Merra, Kanakis, Creme & Mellor, P.C. 7,232 * 4,277 (29) 2,955 *
---------- --------- ---------
Totals 13,580,756 7,431,770 6,148,986
========== ========= =========
- ---------------
<FN>
(1) Represents 161,111 shares issued and 201,389 shares to be issued as "Price
Protection Shares" in connection with our acquisition of The Americom
Group, Inc.
(2) Represents finder's fees in connection with our acquisition of The Americom
Group, Inc.
(3) Represents shares issued in connection with certain assets acquired by our
subsidiary, Atlantic Systems, Inc.
(4) Represents shares issued in connection with our acquisition of Aurora
Electric, Inc.
(5) Represents finder's fees in connection with our acquisition of Aurora
Electric, Inc. and the "Price Protection Shares" issued in connection with
our acquisition of the Fromehill Company dba Winward Electric, Inc.
(6) Represents finder's fees in connection with our acquisition of Aurora
Electric, Inc. and of Teledata Concepts, Inc. Mr. Silverman is one of our
Vice Presidents.
(7) Includes (a) 100,000 shares purchased from us, and (b) 31,750 shares
received as finder's fees in connection with our subsidiary, Universal
Commodities Corp.'s acquisition of Blue Star Electronics, Inc.,
Consolidated Micro Components, Inc., Data Path Technologies, Inc., GDB
Software Services, Inc., and Service Transport Company. Mr. Sherman is
President of Universal Commodities Corp. and one of our Group Vice
Presidents.
(8) Represents shares received as finder's fees in connection with our
subsidiary, Universal Commodities Corp.'s acquisition of Blue Star
Electronics, Inc., Consolidated Micro Components, Inc., Data Path
Technologies, Inc., GDB Software Services, Inc., and Service Transport
Company. Mr. Cummings is a Vice President of Universal Commodities Corp.
(9) Represents shares issued in connection with our subsidiary, Universal
Commodities Corp.'s acquisition of Consolidated Micro Components, Inc.
(10) Represents a finder's fee in connection with our subsidiary, Universal
Commodities Corp.'s acquisition of Consolidated Micro Components, Inc. and
the "Price Protection Shares" issued in connection with our acquisition of
Cybertech Station.
(11) Represents shares issued in connection with our subsidiary, Universal
Commodities Corp.'s acquisition of Data Path Technologies, Inc.
(12) Represents shares received as finder's fees in connection with our
subsidiary, Universal Commodities Corp.'s acquisition of Data Path
Technologies, Inc., and GDB Software Services, Inc. Mr. Keats is a Vice
President of Universal Commodities Corp.
(13) Represents shares issued in connection with our subsidiary, Universal
Commodities Corp.'s acquisition of GDB Software Services, Inc.
(14) Represents a finder's fee in connection with our subsidiary, Universal
Commodities Corp.'s acquisition of GDB Software Services, Inc.
(15) Represents shares issued in connection with our acquisition of Innovative
Vacuum Solutions, Inc.
(16) Represents shares issued in connection with our acquisition of Signature
Industries Limited.
(17) Represents a finder's fee in connection with our acquisition of Signature
Industries Limited.
(18) Represents shares issued in connection with our acquisition of Teledata
Concepts, Inc.
(19) Represents a finder's fee in connection with our acquisition of Teledata
Concepts, Inc.
(20) Represents the "Price Protection Shares" issued in connection with our
acquisition of CT Specialists, Inc.
(21) Represents the "Price Protection Shares" issued in connection with our
acquisition of Information Products Center, Inc.
(22) Represents the "Price Protection Shares" issued in connection with our
acquisition of the Fromehill Company dba Winward Electric, Inc.
(23) Represents the "Price Protection Shares" issued in connection with our
acquisition of Canadian Network Services, Inc.
(24) Represents the "Price Protection Shares" issued in connection with our
acquisition of Blue Star Electronics, Inc.
(25) Represents the "Price Protection Shares" issued in connection with our
acquisition of Advanced Telecommunications, Inc.
(26) Represents shares issued pursuant to Mr. Sullivan's employment agreements
at $3.56 per share in lieu of cash compensation for the period from June 1,
1998 through May 31, 1999. Mr. Sullivan is our Chairman and Chief Executive
Officer.
24
<PAGE>

(27) Represents shares issued in connection with a termination agreement. Mr.
Giacona was an officer of one of our subsidiaries.
(28) Represents shares issued for investment banking services in connection with
various acquisitions made by us. The Bay Group is controlled by Richard J.
Sullivan, our Chairman and Chief Executive Officer, and Angela M. Sullivan,
one of our Directors.
(29) Represents shares issued for professional services rendered.
</FN>
</TABLE>

The following table provides information about the selling shareholders
referred to in Registration Statement No. 333-81533, filed June 25, 1999:

<TABLE>
<CAPTION>
Ownership
Selling Shareholder Ownership Prior to Shares Offered After the
Offering Hereby Offering
-------------------------------------------- ---------------------- ------------------- -------------------
Shares % Shares %
--------- ---- --------- ----
<S> <C> <C> <C> <C> <C>

Bradley A. Haslett 549,020 1.2% 10,558 (1) 538,462 1.1%
James S. Bosshart 10,558 * 10,558 (1) 0 --
John K. Murray 501,469 1.1% 501,469 (2) 0 --
Murray Limited Partnership 220,751 * 220,751 (3) 0 --
Anat Ebenstein 47,408 * 22,075 (4) 25,333 *
Sidney L. Karp Holding Company, Inc. 47,408 * 22,075 (4) 25,333 *
Capital Alliance Corporation 140,533 * 30,905 (4) 109,628 *
Michael Metropolis 155,606 * 155,606 (5) 0 --
Michelle Metropolis 152,076 * 152,076 (6) 0 --
Joseph T. Gabriel 230,613 * 150,357 (7) 80,256 *
David Cairnie 16,136 * 5,565 (8) 10,571 *
John Booker 16,904 * 16,904 (8) 0 --
Robin Tyler 16,904 * 16,904 (8) 0 --
Frederick Bassett 11,742 * 4,049 (8) 7,693 *
Alan Cook 3,818 * 1,317 (8) 2,501 *
Trevor Gage 3,818 * 1,317 (8) 2,501 *
Peter Sayles 3,818 * 1,317 (8) 2,501 *
ECI Ventures Nominees Limited 1,843,025 3.9% 784,184 (8) 1,058,841 2.2%
Fisher Karpark Holdings PLC 937,841 2.0% 399,975 (8) 537,866 1.1%
Kevin O'Keefe and Associates 11,631 * 11,631 (9) 0 --
Hayden, Buczek & Associates 15,000 * 15,000 (10) 0 --
Bruce Reale & Margaret Reale Trustees, 100,000 * 100,000 (11) 0 --
Bruce Reale Revocable Trust
The BOT Group 650,000 1.4% 650,000 (11) 0 --
John E. Fox 43,877 * 43,877 (12) 0 --
John F. Reap 18,193 * 5,053 (13) 13,140 *
Edward Feldman 3,368 * 3,368 (13) 0 *
Scott Bartolette 6,496 * 4,421 (13) 2,075 *
Brian J. Daly 4,421 * 4,421 (13) 0 --
John Beasley 7,560 * 7,560 (13) 0 --
Charles J. Phillips 7,018 * 7,018 (14) 0 --
Lawrence R. Wasielewski 18,327 * 8,327 (15) 10,000 *
Kerry G. Burst 203,494 * 101,740 (16) 101,754 *
Lance J. Umbertis 140,588 * 1,936 (16) 138,652 *
Eric J. Steinmann 56,695 * 1,695 (16) 55,000 *
Scott A. Capistrano 1,934 * 726 (16) 1,208 *
John Dixson 484 * 484 (16) 0 --
Sherri Sheerr 123,563 * 70,646 (17) 52,917 *
Edward L. Cummings 106,549 * 41,719 (18) 64,830 *
Marc Sherman 399,419 * 38,451 (19) 360,968 *
Harvey H. Newman 728,906 1.5% 492,034 (20) 236,872 *
Martin D. Zuckerman 680,436 1.4% 433,639 (20) 246,797 *
Charles Newman 11,719 * 1,266 (20) 10,453 *

</TABLE>

25
<PAGE>
<TABLE>
<CAPTION>

Ownership
Selling Shareholder Ownership Prior to Shares Offered After the
Offering Hereby Offering
-------------------------------------------- ---------------------- ------------------- ------------------
Shares % Shares %
--------- ---- --------- ----
<S> <C> <C> <C> <C> <C>

David C. Gerber 1,210,943 2.6% 289,235 (21) 921,708 1.9%
Toby J. Quesinberry 432,274 * 116,133 (21) 316,141 *
Albert F. Butters, Jr. 78,882 * 78,882 (21) 0 --
James C. Millerberg 49,083 * 49,083 (21) 0 --
Michael E. Sham 606,061 1.3% 606,061 (22) 0 --
Donn J. Wagner 384,615 * 338,461 (23) 46,154 *
Angela S. Wagner 418,615 * 338,461 (23) 80,154 *
Edward M. Kelly 338,461 * 338,461 (23) 0 --
Eileen E. Kelly 424,615 * 338,461 (23) 86,154 *
Joseph S. Keats 9,813 * 6,121 (24) 3,692 *
Patrick C. Chai 489,338 1.0% 303,030 (25) 186,308 *
Robert W. Borra 460,338 * 303,030 (25) 157,308 *
Dominick & Dominick, Incorporated 250,000 * 250,000 (26) 0 --
Craig W. Nelson 157,465 * 121,465 (27) 36,000 *
Great Bay Technology, Inc. 617,117 1.3% 250,000 (28) 367,117 *
Garrett A. Sullivan 100,000 * 100,000 (29) 0 --
Locken, Chesnut & Cape 75,000 * 75,000 (30) 0 --
Gary D. Hornbuckle and Sandra Hornbuckle 360,466 * 360,466 (31) 0 --
Sterling Hornbuckle 110,913 * 110,913 (31) 0 --
Luis Alvarez 83,184 * 83,184 (31) 0 --
Robert J. Lynch 386,571 * 386,571 (32) 0 --
Peter A. Marks 386,571 * 386,571 (32) 0 --
Scott A. Lines 173,093 * 173,093 (33) 0 --
Susan S. Lines 106,519 * 106,519 (33) 0 --
Robert W. Munson 279,612 * 279,612 (33) 0 --
Enrica Carroll 279,612 * 279,612 (33) 0 --
Chuck Sword 93,203 * 93,203 (33) 0 --
----------- ----------- ----------

Total 16,611,550 10,714,602 5,896,948
=========== =========== ==========
- ------------------
<FN>

(1) Represents "Price Protection" shares issued under the Agreement of Sale in
connection with our acquisition of Aurora Electric, Inc.
(2) Includes (a) 135,023 "Price Protection" shares issued under the Agreement
of Sale in connection with our acquisition of Information Products Center,
Inc. and (b) 366,446 shares issued upon achievement of the "Earnout"
provision in the Agreement of Sale.
(3) Represents shares issued to a partnership designated by the selling
shareholder upon the achievement of the "Earnout" provision in the
Agreement of Sale in connection with our acquisition of Information
Products Center, Inc.
(4) Represents shares issued to individuals designated by the selling
shareholder upon the achievement of the "Earnout" provision in the
Agreement of Sale in connection with our acquisition of Information
Products Center, Inc.
(5) Includes (a) 1,770 "Price Protection" shares issued under the Agreement of
Sale in connection with our acquisition of Innovative Vacuum Solutions,
Inc., (b) 142,071 shares issued upon achievement of the "Earnout" provision
in the Agreement of Sale, and (c) 11,765 shares earned as a bonus.
(6) Includes (a) 1,770 "Price Protection" shares issued under the Agreement of
Sale in connection with our acquisition of Innovative Vacuum Solutions,
Inc., (b) 142,071 shares issued upon achievement of the "Earnout" provision
in the Agreement of Sale, and (c) 8,235 shares earned as a bonus.
(7) Includes (a) 1,770 "Price Protection" shares issued under the Agreement of
Sale in connection with our acquisition of Innovative Vacuum Solutions,
Inc., (b) 142,071 shares issued upon achievement of the "Earnout" provision
in the Agreement of Sale, and (c) 6,516 shares earned as a bonus.
(8) Represents "Price Protection" shares issued under the Agreement of Sale in
connection with our acquisition of Signature Industries Limited.
(9) Represents "Price Protection" shares issued under the Agreement of Sale in
connection with the payment of a finders fee in connection with our
acquisition of Signature Industries Limited.

26
<PAGE>

(10) Represents shares issued for services rendered.
(11) Represents shares issued in connection with the Earnout Agreement in
connection with our acquisition of ATI Communications, Inc. The BOT Group
is controlled by Bruce Reale.
(12) Represents shares issued as a finders fee in connection with our
acquisition of TigerTel Services Limited.
(13) Represents shares earned as a bonus.
(14) Represents shares issued in connection with our subsidiary's,
Intellesale.com, acquisition of certain assets of Fiscal Advantage
Corporation from Mr. Phillips.
(15) Represents shares issued in lieu of compensation.
(16) Represents shares issued upon achievement of the "Earnout" provision of the
Agreement of Sale in connection with our acquisition of The Americom Group.
(17) Represents shares issued upon achievement of the "Earnout" provision of the
Agreement of Sale in connection with our subsidiary's, Universal
Commodities Corp., acquisitions of Cybertech Station, Inc. and Consolidated
Micro Components, Inc.
(18) Represents shares issued upon achievement of the "Earnout" provisions of
the Agreements of Sale in connection with our subsidiary's, Universal
Commodities Corp., acquisitions of Cybertech Station, Inc., PPL, Ltd,
Consolidated Micro Components, Inc, Data Path Technologies, Inc. and GDB
Software Services, Inc.
(19) Represents shares issued upon achievement of the "Earnout" provisions of
the Agreements of Sale in connection with our subsidiary's, Universal
Commodities Corp., acquisitions of Consolidated Micro Components, Inc, Data
Path Technologies, Inc. and GDB Software Services, Inc.
(20) Represents shares issued upon achievement of the "Earnout" provisions of
the Agreement and Plan of Merger in connection with our subsidiary's,
Universal Commodities Corp., acquisition of PPL, Ltd.
(21) Represents shares issued upon achievement of the "Earnout" provisions of
the Agreement of Sale in connection with our acquisitions of Winward
Electric, Inc. and the Fromehill Company.
(22) Represents shares issued upon achievement of the "Earnout" provisions of
the Agreement of Sale in connection with our subsidiary's, Universal
Commodities Corp., acquisition of Consolidated Micro Components, Inc.
(23) Represents shares issued upon achievement of the "Earnout" provisions of
the Agreement and Plan of Class B Reorganization in connection with our
subsidiary's, Universal Commodities Corp., acquisition of Data Path
Technologies, Inc.
(24) Represents shares issued upon (a) the achievement of the "Earnout"
provisions of the Agreement and Plan of Class B Reorganization in
connection with our subsidiary's, Universal Commodities Corp., acquisition
of Data Path Technologies, Inc., and (b) shares issued upon achievement of
the "Earnout" provisions of the Agreement of Sale in connection with our
subsidiary's, Universal Commodities Corp., acquisition of GDB Software
Services, Inc.
(25) Represents shares issued upon achievement of the "Earnout" provisions of
the Agreement of Sale in connection with our subsidiary's, Universal
Commodities Corp., acquisition of GDB Software Services, Inc.
(26) Represents shares underlying the issuance of Class "U" warrants to Dominick
& Dominick, Incorporated for services rendered. The Class "U" warrants may
be converted into shares of our Common Stock at an exercise price of $8.375
per share for a period of five years, commencing June 5, 1998.
(27) Represents shares issued in connection with our acquisition of Mr. Nelson's
minority interest in Cra-Tek Company, a company in which we acquired an 80%
interest in September, 1996.
(28) Represents shares underlying the issuance of Class "K" warrants to Great
Bay Technology, Inc. in 1996 for services rendered. The shares underlying
the issuance of the warrants were previously registered in a registration
statement in 1996 which registration statement has been terminated and, by
agreement with the warrantholder, they are being included in this
registration. The Class "K" warrants may be converted into shares of our
Common Stock at an exercise price of $5.31 per share for a period of five
years, commencing September 13, 1996. Great Bay Technology, Inc. is
controlled by Richard J. Sullivan, Chairman, Angela M. Sullivan, Director,
and Stephanie Sullivan.
(29) Represents shares underlying the issuance of Class "H" warrants to Garrett
A. Sullivan President, in 1996 for services rendered. The shares underlying
the issuance of the warrants were previously registered in a registration
statement in 1996 which registration statement has been terminated and, by
agreement with the warrantholder, they are being included in this
registration. The Class "H" warrants may be converted into shares of our
Common Stock at an exercise price of $2.00 per share for a period of five
years, commencing August 8, 1998.
(30) Represents shares underlying the issuance of Class "L" warrants to Locken,
Chesnut & Cape, or assigns, in 1996 for services rendered. The shares
underlying the issuance of the warrants were previously registered in a
registration statement in 1996 which registration statement has been
terminated and, by agreement with the warrantholder, they are being
included in this registration. The Class "L" warrants may be converted into
shares of our Common Stock at an exercise price of $2.00 per share for a
period of five years, commencing October 1, 1996.
(31) Represents shares of common stock received in connection with our
acquisition of a 100 percent interest in Hornbuckle Engineering, Inc.,
effective as of April 1, 1999.

27
<PAGE>

(32) Represents shares of common stock received in connection with our
acquisition of a 100 percent interest in Lynch Marks & Associates, Inc.
effective as of April 1, 1999.
(33) Represents shares of common stock received in connection with our
acquisition of a 100 percent interest in STR, Inc., effective as of April
1, 1999.
</FN>
</TABLE>

28
<PAGE>

DESCRIPTION OF CAPITAL STOCK

Our Amended and Restated Articles of Incorporation authorize the issuance
of up to 80,000,000 shares of our Common Stock and up to 5,000,000 shares of
preferred stock (the "Preferred Stock"). The Preferred Stock may be issued from
time to time and on such terms as are specified by our Board of Directors,
without further authorization from our shareholders.

As of October 11, 1999, there were 47,568,948 shares of our Common Stock
outstanding. In addition, 836,472 shares of Common Stock are reserved for
issuance in exchange for the exchangeable shares of two of our Canadian
subsidiaries.

As of October 11, 1999, (a) there were issued and outstanding warrants to
purchase 2,160,000 shares of our Common Stock at a weighted average exercise
price of $3.56 per share, and (b) options held by our employees to purchase
13,013,229 shares of our Common Stock at a weighted average exercise price of
$2.87 per share. All of the warrants are currently exercisable. Of the
outstanding options, 6,180,700 are now exercisable at a weighted average
exercise price of $3.68 per share, and the rest become exercisable at various
times over the next three years.

PRICE RANGE OF COMMON STOCK

Our Common Stock trades on the NASDAQ Stock Market(R) under the symbol
"ADSX." The following table sets forth the high and low sale prices of the
Common Stock as reported by the NASDAQ for each of the quarters since the
beginning of 1997.

High Low
1997
First Quarter............................ 5 7/8 4
Second Quarter........................... 4 3/8 2 5/8
Third Quarter ........................... 8 3/4 2 13/16
Fourth Quarter .......................... 9 3/4 3 25/32
1998
First Quarter............................ 5 1/2 4 1/32
Second Quarter........................... 4 7/8 3 1/8
Third Quarter ........................... 3 1/2 1 9/16
Fourth Quarter .......................... 5 1/2 1 17/32
1999
First Quarter............................ 4 3/16 2
Second Quarter........................... 3 1/2 2
Third Quarter............................ 3 3/8 1 11/16
Fourth Quarter (through October 11, 1999) 1 29/32 1 3/4

Holders

As of September 30, 1999, there were 1,221 holders of record of our Common
Stock.

29
<PAGE>

PLAN OF DISTRIBUTION

The Selling Shareholders may sell the shares offered hereby in one or more
transactions (which may include "block" transactions) on the NASDAQ Stock
Market, in the over-the-counter market, in negotiated transactions or in a
combination of such methods of sales, at fixed prices which may be changed, at
market prices prevailing at the time of sale, at prices related to such
prevailing market prices or at negotiated prices. The Selling Shareholders may
effect such transactions by selling the shares directly to purchasers, or may
sell to or through agents, dealers or underwriters designated from time to time,
and such agents, dealers or underwriters may receive compensation in the form of
discounts, concessions or commissions from the Selling Shareholders and/or the
purchaser(s) of the shares for whom they may act as agent or to whom they may
sell as principals, or both. The Selling Shareholders may also pledge certain of
the shares from time to time, and this prospectus also relates to any sale of
shares that might take place following any foreclosure of such a pledge. The
Selling Shareholders and any agents, dealers or underwriters that act in
connection with the sale of the shares might be deemed to be "underwriters"
within the meaning of Section 2(11) of the Securities Act, and any discount or
commission received by them and any profit on the resale of the shares as
principal might be deemed to be underwriting discounts or commissions under the
Securities Act.

We will receive no portion of the proceeds from the sale of the shares and
will bear all of the costs relating to the registration of this offering (other
than any fees and expenses of counsel for the Selling Shareholders). Any
commissions, discounts or other fees payable to a broker, dealer, underwriter,
agent or market maker in connection with the sale of any of the shares will be
borne by the Selling Shareholders.

LEGAL OPINION

Bryan Cave LLP, St. Louis, Missouri, as our counsel, has issued an opinion
as to the legality of the Common Stock.

EXPERTS

The consolidated financial statements incorporated in this prospectus by
reference to the Annual Report on Form 10-K for the year ended December 31,
1998, have been so incorporated in reliance on the report of
PricewaterhouseCoopers LLP, independent accountants, given on the authority of
said firm as experts in auditing and accounting. The consolidated financial
statements incorporated in this prospectus by reference to the Annual Report on
Form 10-K for the year ended December 31, 1997, have been so incorporated in
reliance on the report of Rubin, Brown, Gornstein & Co. LLP, independent
accountants, given on the authority of said firm as experts in auditing and
accounting.

30
<PAGE>

PART II
INFORMATION NOT REQUIRED IN PROSPECTUS

Item 14. Other Expenses of Issuance and Distribution.

The following table sets forth the expenses (other than underwriting
discounts and commissions), which other than the SEC registration fee are
estimates, payable by the Registrant in connection with the sale and
distribution of the shares registered hereby**:

SEC Registration Fee ........................................ $53,900
Accounting Fees and Expenses................................. 60,000*
Legal Fees and Expenses...................................... 95,000*
Miscellaneous Expenses....................................... 24,100*
---------
Total ........................................... $233,000*
- -------------
* Estimated

** The Selling Shareholders will pay any sales commissions or underwriting
discount and fees incurred in connection with the sale of shares
registered hereunder.

Item 15. Indemnification of Directors and Officers.

Sections 351.355(1) and (2) of The General and Business Corporation Law of
the State of Missouri provide that a corporation may indemnify any person who
was or is a party or is threatened to be made a party to any threatened, pending
or completed action, suit or proceeding by reason of the fact that he is or was
a director, officer, employee or agent of the corporation, or is or was serving
at the request of the corporation as a director, officer, employee or agent of
another corporation, partnership, joint venture, trust or other enterprise,
against expenses, judgments, fines and amounts paid in settlement actually and
reasonably incurred by him in connection with such action, suit or proceeding if
he acted in good faith and in a manner he reasonably believed to be in or not
opposed to the best interests of the corporation and, with respect to any
criminal action or proceeding, had no reasonable cause to believe his conduct
was unlawful, except that, in the case of an action or suit by or in the right
of the corporation, the corporation may not indemnify such persons against
judgments and fines and no person shall be indemnified as to any claim, issue or
matter as to which such person shall have been adjudged to be liable for
negligence or misconduct in the performance of his duty to the corporation,
unless and only to the extent that the court in which the action or suit was
brought determines upon application that such person is fairly and reasonably
entitled to indemnity for proper expenses. Section 351.355(3) provides that, to
the extent that a director, officer, employee or agent of the corporation has
been successful in the defense of any such action, suit or proceeding or any
claim, issue or matter therein, he shall be indemnified against expenses,
including attorneys' fees, actually and reasonably incurred in connection with
such action, suit or proceeding. Section 351.355(7) provides that a corporation
may provide additional indemnification to any person indemnifiable under
subsection (1) or (2), provided such additional indemnification is authorized by
the corporation's articles of incorporation or an amendment thereto or by a
shareholder-approved bylaw or agreement, and provided further that no person
shall thereby be indemnified against conduct which was finally adjudged to have
been knowingly fraudulent, deliberately dishonest or willful misconduct or which
involved an accounting for profits pursuant to Section 16(b) of the Securities
Exchange Act of 1934.

The bylaws of the Registrant provide that the Registrant shall indemnify,
to the full extent permitted under Missouri law, any director, officer, employee
or agent of the Registrant who has served as a director, officer, employee or
agent of the Registrant or, at the Registrant's request, has served as a
director, officer, employee or agent of another corporation, partnership, joint
venture, trust or other enterprise.

Insofar as indemnification for liabilities arising under the Securities Act
of 1933 may be permitted to directors, officers or persons controlling the
Registrant pursuant to such provisions, the Registrant has been informed that in
the opinion of the Securities and Exchange Commission such indemnification is
against public policy as expressed in such Act and is therefore unenforceable.

II-1
<PAGE>

Item 16. Exhibits.
See Exhibit Index.

Item 17. Undertakings.

(a) The undersigned issuer hereby undertakes:

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

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

(ii) To reflect in the prospectus any facts or events
arising after the effective date of this registration
statement (or the most recent post-effective amendment hereof)
which, individually or in the aggregate, represent a
fundamental change in the information set forth in this
registration statement;

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

provided, however, that paragraphs (i) and (ii) do not apply if the
information required to be included in a post-effective amendment by
those paragraphs is contained in periodic reports filed by the
Registrant pursuant to Section 13 or Section 15(d) of the Securities
Exchange Act of 1934 that are incorporated by reference in this
registration statement.

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

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

(b) The undersigned Registrant hereby undertakes that, for purposes of
determining any liability under the Securities Act of 1933, each filing of the
Registrant's annual report pursuant to Section 13(a) or 15(d) of the Securities
Exchange Act of 1934 that is incorporated by reference in this registration
statement shall be deemed to be a new registration statement relating to the
securities offered herein, and the offering of such securities at that time
shall be deemed to be the initial bona fide offering thereof.

(c) Insofar as indemnification for liabilities arising under the Securities
Act of 1933 (the "Act") may be permitted to directors, officers and controlling
persons of the Registrant pursuant to the foregoing provisions, or otherwise,
the Registrant has been advised that in the opinion of the Securities and
Exchange Commission such indemnification is against public policy as expressed
in the Act and is, therefore, unenforceable. In the event that a claim for
indemnification against such liabilities (other than the payment by the
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 Act and will
be governed by the final adjudication of such issue.

II-2
<PAGE>

SIGNATURES

Pursuant to 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 for filing on Form S-3 and has duly caused this Registration
Statement to be signed on its behalf by the undersigned, thereunto duly
authorized, in the City of Palm Beach, State of Florida, on October 13, 1999.

APPLIED DIGITAL SOLUTIONS, INC.

By: /S/ David A. Loppert
---------------------------------------
David A. Loppert, Vice President,
Treasurer and Chief Financial Officer

Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement has been signed by the following persons in the
capacities and on the dates indicated.

Signature Title Date

RICHARD J. SULLIVAN* Chairman of the Board of
- -------------------------- Directors, Chief Executive October 13, 1999
(Richard J. Sullivan) Officer and Secretary
(Principal Executive Officer)

GARRETT A. SULLIVAN* President and Director (Principal October 13, 1999
- -------------------------- Operating Officer)
(Garrett A. Sullivan)

/S/ DAVID A. LOPPERT Vice President, Treasurer and
- -------------------------- Chief Financial Officer October 13, 1999
(David A. Loppert) (Principal Accounting Officer)

ANGELA M. SULLIVAN* Director October 13, 1999
- --------------------------
(Angela M. Sullivan)

DANIEL E. PENNI* Director October 13, 1999
- --------------------------
(Daniel E. Penni)

ARTHUR F. NOTERMAN*(1) Director October 13, 1999
- --------------------------
(Arthur F. Noterman)

CONSTANCE K. WEAVER*(2) Director October 13, 1999
- --------------------------
(Constance K. Weaver)

*By: /S/ David A. Loppert
_____________________
David A. Loppert
Attorney-in-Fact

_______________________
(1) The signature of Arthur F. Noterman only relates to the Post-Effective
Amendment No. 3 on Form S-3 to the following Registration Statements filed
originally on Form S-3: Nos. 333-25431 (filed 4/18/97), 333-37713 (filed
10/10/97), 333-45139 (filed 1/29/98), 333-51067 (filed 4/27/98) and
333-64755 (filed 9/30/98).
(2) The signature of Constance K. Weaver only relates to the Post-Effective
Amendment No. 1 on Form S-1 to Registration Statement No. 333-81533 (filed
6/25/99).

II-3

<PAGE>

EXHIBIT INDEX
Exhibit
Number Description

4.1 Second Restated Articles of Incorporation of the Registrant
(incorporated herein by reference to Exhibit 4.1 to the
Registrant's Post-Effective Amendment No. 1 on Form S-1 to
Registration Statement (Form S-3 File No. 333-64605) filed with
the Commission on June 23, 1999)

4.2 Amended and Restated Bylaws of the Registrant dated March 31,
1998 (incorporated herein by reference to Exhibit 4.1 to the
Registrant's Registration Statement on Form S-3 (File No.
333-51067) filed with the Commission on April 27, 1998)

5.1 Opinion of Bryan Cave LLP regarding the validity of the Common
Stock *

23.1 Consent of PricewaterhouseCoopers LLP

23.2 Consent of Rubin, Brown, Gornstein & Co., LLP

23.4 Consent of Bryan Cave LLP (included in Exhibit 5.1) *

24.1 Power of Attorney *

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

* Previously filed

Exhibit 23.1

CONSENT OF INDEPENDENT ACCOUNTANTS

We hereby consent to the incorporation by reference in this Post-Effective
Amendment No. 3 to Registration Statement on Form S-3 and Post-Effective
Amendment No. 1 to Registration Statement on Form S-1 of Applied Digital
Solutions, Inc. (formerly, Applied Cellular Technology, Inc.) of our report
dated February 19, 1999 relating to the financial statements of Applied Cellular
Technology, Inc., included in Applied Cellular Technology, Inc's Form 10-K for
the year ended December 31, 1998. We also consent to the reference to us under
the heading "Experts" in such Registration Statement.

/S/ PricewaterhouseCoopers LLP
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PricewaterhouseCoopers LLP

St. Louis, Missouri
October 13, 1999

Exhibit 23.2

CONSENT OF INDEPENDENT ACCOUNTANTS

We hereby consent to the incorporation by reference in this Post-Effective
Amendment No. 3 to the Registration Statement on Form S-3 and Post-Effective
Amendment No. 1 to Registration Statement on Form S-1 of Applied Digital
Solutions, Inc. (formerly, Applied Cellular Technology, Inc.) of our report
dated February 24, 1998 relating to the financial statements and financial
statement schedule of Applied Cellular Technology, Inc. included in Applied
Cellular Technology's Form 10-K for the year ended December 31, 1998. We also
consent to the reference to us under the heading "Experts" in such Registration
Statement.

/S/ Rubin, Brown, Gornstein & Co. LLP
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Rubin, Brown, Gornstein & Co. LLP

St. Louis, Missouri
October 13, 1999