SIMS COMMUNICATIONS, INC. AND SUBSIDIARIES
                      Table of Contents
                              
                              
                                                                 Page
Independent Auditors' Report                                    F - 1
Financial Statements
Consolidated Balance Sheet                                      F - 2
Consolidated Statements of Operations                           F - 3
Consolidated Statement of Stockholders' Equity                  F - 4
Consolidated Statements of Cash Flows                           F - 5
Notes to Consolidated Financial Statements                      F - 6
                INDEPENDENT AUDITORS' REPORT
                              
                              
Board of Directors and Stockholders
SIMS Communications, Inc. and Subsidiaries
Delray Beach, Florida


We  have audited the accompanying consolidated balance sheet of  SIMS
Communications,  Inc. and Subsidiaries as of June 30,  1996  and  the
related  consolidated statements of operations, stockholders' equity,
and  cash  flows for the years ended June 30, 1996 and  1995.   These
financial   statements  are  the  responsibility  of  the   Company's
management.   Our  responsibility is to express an opinion  on  these
financial statements based on our audits.

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

In  our  opinion, the consolidated financial statements  referred  to
above  present  fairly,  in  all  material  respects,  the  financial
position of SIMS Communications, Inc. and Subsidiaries as of June 30,
1996 and the results of their operations and cash flows for the years
ended  June  30, 1996 and 1995 in conformity with generally  accepted
accounting principles.

The  accompanying  financial statements have been  prepared  assuming
that  the Company will continue as a going concern.  As discussed  in
Note  2  to  the  financial  statements,  the  Company  has  suffered
recurring losses from operations which raise substantial doubt  about
its  ability  to continue as a going concern.  Management's  plan  in
regard  to  these matters is also described in Note 2.  The financial
statements do not include any adjustments that might result from  the
outcome of this uncertainty.




                                 Ehrhardt Keefe Steiner & Hottman PC
September 27, 1996
Denver, Colorado
                     Consolidated Balance Sheet June 30, 1996
                            
                            
                               Assets
Current assets
  Cash and cash equivalents ($250,000 Restricted) (Note 5) $322,542
Accounts receivables                                       150,950
Franchise and other receivables, less allowance for
 doubtful accounts of $10,000                               208,582
Inventories                                                1,059,637
  Prepaid expenses (Note 4)                                   58,904
Notes receivable, current portion (Note 3)                  182,637
       Total current assets                               1,983,252

Property and equipment, net of accumulated depreciation
 of $321,245                                               1,071,85

Other assets
   Notes receivable (Note 3)                               201,363
  Deferred location costs                                     38,100
  Deposits                                                    13,761
Organization costs, net of accumulated amortization
  of $15,435                                               4,045
       Total other assets                                257,269

Total assets                                           $3,312,372

                Liabilities and Stockholders' Equity
Current liabilities
   Accounts payable                                        $462,498
   Accrued expenses
                                                           341,733
   Bank line of credit (Note 5)
                                                           250,000
  Current obligations under capital lease
(Note 4)                                                   6,148
  Current maturities of long-term debt
(Note 6)                                                   407,666
  Franchise deposits and customer deposits (Note 12)        875,263
       Total current liabilities                             2,343,308
                               
Long-term liabilities
  Long-term debt (Note 6)
                                                             59,048
  Obligations under capital lease (Note
4)                                                           2,178
       Total liabilities
                                                           2,404,53 4
                                                           
Commitments and contingencies (Notes 4
and 14)

Stockholders' equity (Note 10)
   Preferred stock, Series A, $.001 par
value, 300,000 shares authorized, no
shares issued and outstanding                                -
   Preferred stock, Series B, $.001 par
value, 100,000 shares authorized, no
shares issued or outstanding                                 -
   Preferred stock subscribed 125,250 shares
                                                             365,000
    Common stock $.0001 par value 40,000,000
shares authorized, 4,029,908 issued and
outstanding                                                  403
  Additional paid-in capital
                                                           11,060,7 35
  Accumulated deficit
                                                           (10,518,
                                                           300)
                                                           
       Total stockholders' equity
                                                             907,838

Total liabilities and stockholders'                                  $
equity                                                       3,312,37
                                                             2
                Consolidated Statements of Operations
                
                
                
                                                   Year Ended June
                                           30,

                                           1996               1995
Revenue
  Rental                                           $
$197,419
                                           849,877
  Activations                                                        -
                                           846,524
  Equipment and other                      353,204
                                           831,171
  Franchise and royalty
146,286
                                           80,307
      Total revenue
696,909
                                           2,607,879

Cost of sales
607,509
                                           1,686,188

Gross profit
89,400
                                           921,691

Operating expenses
  General and administrative
1,604,451
                                           1,518,950
  Depreciation and amortization
74,747
                                           206,581
  Selling expenses                                           537,698
                                           982,130
  Stock based compensation
20,000
                                              1,765,000
  Research and development
89,398
                                              134,470
      Total expenses
2,326,294
                                              4,607,131

Operating loss
(2,236,894)
                                              (3,685,44
                                              0)

Other income (expense)
  Interest expense
(253,057)
                                              (65,221)
  Interest income
38,839
                                              27,155
                                              
                                              (214,218) (38,066)
Loss before income taxes
(2,451,112)
                                              (3,723,50
                                              6)

Income tax expense (Note 7)
-
                                              -

Net loss                                              $
$(2,451,112)
                                              (3,723,50
                                              6)

Net loss per common share                             $
$
                                              (1.56)        (1.43)

Weighted     average    common     shares
1,716,581
outstanding (Note 11)                         2,384,055
           Consolidated Statements of Stockholders' Equity
                 Years Ended June 30, 1996 and 1995


                                        Subscribed

                                    Preferred Stock     Common Stock
                                    Subscrib
Number
                                       ed
of
                                     Number              Number
Shares
                                       of                  of

                                    Shares    Amount    Shares
Subscrib
                                                                  ed
                                                         (Note
                                                          11)

Balance June 30, 1994                         -       $  -
96,591
                                                        4,334,51
                                                        2

Issuance of stock upon stock split
of 3 for 2 and 2 for 1 (Note 11)              -
193,182
                                              -         8,669,02
                                                        4

Issuance of common stock as a                 -          -
54,330
valuation guarantee (Note 10)                           -

Issuance of common stock for cash
(ranging from $.27 to $.83 per                -                     -
share)                                        -         2,852,74
                                                        1

Stock issued as inducement to
noteholders ranging from ($.67 to             -          -
91,170      -
$1 per share) (Note 10)

Issuance of common stock upon
conversion of debt and interest               -                     -
($.67 per share) (Note 10)                    -         274,660

Issuance of common stock in
conjunction with Initial Public
Offering ($1.75 per share) less               -                     -
offering costs of $1,099,938 (Note            -         3,622,50
10)                                                     0

Issuance   of  subscribed   common            -          -   (344,103)
stock                                                   344,103

Amortization  of noteholder  stock            -          -         -
inducements                                             -

Preferred stock - subscribed (Note            24,250       245,000   -
10)                                                     -

Net loss for the year                         -          -           -
                                                        -

Balance June 30, 1995                         24,250      245,000   -
                                                        20,188,7
                                                        10

Adjustment  of stock upon  reserve
stock split of 1 for 10 (Note 11)             -                     -
                                              -         (18,169,
                                                        780)

Issuance of common stock for  cash
(ranging  from $.75 to  $1.88  per            -                    -
share)                                        -         50,928

Issuance  of  common  stock   upon
conversion   of   officer    notes            -                    -
payable  ($2.07 per  share)  (Note            -         175,110
10)

Issuance   of  common  stock   for
services    ($1.00   per    share)            -                     -
(Note 10)                                     -         1,365,00
                                                        0

Issuance  of  common  stock   upon
conversion   of   officer    notes            -                     -
payable ($.50 per share) (Note 10)            -         419,940

Officer   notes  payable  forgiven            -          -         -
(Note 10)                                               -

Accrued officer salaries forgiven             -          -         -
(Note 10)                                               -

Preferred stock - subscribed (Note            101,000     120,000    -
10)                                                     -

Dividends paid on preferred stock             -          -       -
                                                        -
Net loss for the year                         -          -        -
                                                        -

Balance - June 30, 1996                       125,250              $
365,000               -

4,029,90
                                                               8







          Addition   Stock
             al      Issued
          Paid-in     for     Accumula
                     Future     ted

Amount    Capital   Interest  Deficit   Total



       $  433       $  2,168,916       $         $                $
(2,250,499)
                    (84,366)  (4,335,4
                              82)


          867
          (867)     -         -         -

          -          -
                    -         -         -


          285                    -
          895,820             -         896,105


          9
          62,017    -         -         62,026


          28
          182,623   -         -         182,651



          362
          5,239,07  -         -         5,239,43
          5                             7

          34          (34)
                    -         -         -

          -                    84,366
          -                   -         84,366

          -          -
                    -         -         245,000

          -          -
                    -         (2,451,1  (2,451,1
                              12)       12)

                    8,547,550          -          (6,786,594)
2,007,974
2,018


                    1,816
(1,816)             -         -         -


                    50,301
5                   -         -         50,306


                    361,982
18                  -         -         362,000


                    1,364,864
136                 -         -         1,365,00
                              0
                              
                              
                    209,928
42                  -         -         209,970

                    124,294          -
-                             -         124,294

                    400,000          -
-                             -         400,000

                    -          -
-                             -         120,000

                              -
                              (8,200)   (8,200)

                    -          -
-                             (3,723,5  (3,723,5
                              06)       06)

       $         $  11,060,735       $  -       $         $
403                           (10,518,  907,838
                              300)
                Consolidated Statements of Cash Flows



                                              June 30,

                                              1996         1995
Cash flows from operating activities
  Net (loss)                                         $     $(2,451,
                                              (3,723,5     112)
                                              06)
   Adjustments to reconcile net loss to net
cash used in operating activities
   Depreciation                                              73,187
                                              205,021
   Amortization                                               3,912
                                              1,560
      Gross profit on sales of equipment to
officers in settlement of advances
payable (Note 8)                              (284,060     -
                                              )
   Stock issued for services                                     -
                                              1,765,00
                                              0
   Changes in assets and liabilities
     Inventories                                           (780,031
                                              (80,724)     )
     Accounts and other receivables                         (3,153)
                                              (304,171
                                              )
     Prepaid expenses                                        96,828
                                              4,149
     Accounts payable                                      (445,703
                                              350,330      )
     Accrued expenses                                      (204,018
                                              303,383      )
     Franchise deposits and customer                       (225,089
deposits                                      (96,186)     )
                                                           (1,484,0
                                              1,864,30     67)
                                              2
       Net cash used in operating                          (3,935,1
activities                                    (1,859,2     79)
                                              04)

Cash flows from investing activities
  Note receivable                                          (150,000
                                              (234,000     )
                                              )
  Capital expenditures                                      (8,247)
                                              (52,000)
  Change in other assets                                     56,540
                                              24,292
       Net cash used in investing                          (101,707
activities                                    (261,708     )
                                              )

Cash flows from financing activities
  Proceeds from issuance of long-term                       715,000
debt                                          160,348
  Proceeds (payments to) from officer                      (64,841)
advances                                      1,146,26
                                              4
  Payments under capital lease obligation                   (4,776)
                                              (7,440)
  Proceeds from issuance of common stock                   6,197,56
                                              50,306       8
  Payments on long-term debt                               (1,940,0
                                              (57,909)     00)
  Dividends paid                                                 -
                                              (8,200)
       Net cash provided by financing                      4,902,95
activities                                    1,283,36     1
                                              9

Net (decrease) increase in cash                             866,065
                                              (837,543
                                              )

Cash at beginning of year                                   294,020
                                              1,160,08
                                              5

Cash at end of year                                  $     $1,160,0
                                              322,542      85

Supplemental disclosure of cash flows information
     Cash  paid  during the year for interest was $57,311 (1996)  and
$315,674 (1995).
Non-cash investing and financing activities
    During  the fiscal year ended June 30, 1996 and 1995, the Company
    transferred  $517,017  and $569,100 of ACDC units,  respectively,
    from  inventory to property, plant, and equipment as these  units
    represented company owned locations.
    
    During  the fiscal year ended June 30, 1996 and 1995, the Company
    bought  back  franchisees upon the issuance  of  preferred  stock
    (Note 10).
    
    During  the fiscal year ended June 30, 1996 and 1995, the Company
    converted  accrued  officer salaries, officer  advances  payable,
    debt  and  accrued interest to common and preferred  stock  (Note
    10).
    
    During  the  fiscal year ended June 30, 1996, the Company  bought
    back  franchisees  by  entering into  debt  obligations  totaling
    $147,000.   $147,000 of inventory and other assets were  received
    by the Company.
    
    During the fiscal year ended June 30, 1996, the Company had  a  1
    for 10 reverse stock split.
    
    
Note 1 - Organization and Significant Accounting Policies

Organization

SIMS   COMMUNICATIONS  Inc.  and  Subsidiaries  (the   Company)   was
incorporated  in  the  State of Delaware on  August  15,  1991.   The
Company was formed as a communication equipment company.

Principles of Consolidation

The  consolidated financial statements includes the accounts of  SIMS
COMMUNICATIONS, Inc. and its wholly owned subsidiaries SIMS Franchise
Group  Inc.,  Cellex  Communications Inc.,  and  SIMS  Communications
International,  Inc.   All  significant  intercompany  balances   and
transactions have been eliminated in consolidation.

Use of Estimates

The  preparation of financial statements in conformity with generally
accepted  accounting principles requires management to  make  certain
estimates and assumptions that affect the reported amounts of  assets
and  liabilities  at  the date of the financial  statements  and  the
reported  amounts  of  revenues  and expenses  during  the  reporting
period.   Management believes that such estimates have been based  on
reasonable assumptions and that such estimates are adequate, however,
actual results could differ from those estimates.

Cash and Cash Equivalents

The Company considers all highly liquid instruments purchased with  a
maturity of three months or less to be cash equivalents.

Inventories

Inventories  consists  primarily of automated  cellular  distribution
centers  (ACDC's), cellular phones and other communications equipment
and  are  recorded at the lower of cost or market determined  by  the
first-in, first-out method.

Property and Equipment

Property  and  equipment are recorded at cost  and  depreciated  over
their  estimated useful lives (5 to 7 years), utilizing the straight
line method.  Expenditures for maintenance and repairs are charged to
expense as incurred.


Note 1 - Organization and Significant Accounting Policies (continued)

Organization Costs

Organization  costs  have been capitalized and  are  being  amortized
using the straight-line method over a five year period.

Net loss Per Common Share

Net  loss per common share is based upon the weighted average  number
of  common  shares outstanding during each of the respective  periods
(Note  11).   Common shares issuable upon the exercise of convertible
notes  and  common stock equivalents are excluded from  the  weighted
average number of shares since the effect is anti-dilutive.

Deferred Location Costs

Deferred location costs relate to costs associated with the buy  back
of  certain  franchisees (Note 10).  These costs are  amortized  over
five years.

Revenue Recognition

Rental  revenue  is recognized upon the completion  of  the  customer
phone rental. Activation revenue is recognized upon the activation of
the customers cellular account with the appropriate carrier. Revenues
from  the  sale of the Automated Cellular Distribution Center  (ACDC)
and other equipment are recognized upon delivery.

Royalty Fees

Royalties  as  allowed by the franchise agreement are  accrued  on  a
percentage of gross sales, as defined, as reported by franchisees and
are included in accounts receivable.

Research and Development

Research and development costs consist primarily of costs related  to
the   conceptual  formation,  design,  tooling  and  development   of
prototypes and are expensed as incurred.

Concentration of Credit Risks

Financial  instruments  that  potentially  subject  the  Company   to
concentration  of  credit risk consist primarily  of  temporary  cash
investments.   The  Company  places its cash  investments  with  high
credit  quality  financial institutions and,  by  policy  limits  the
amount of credit exposure to any one institution.  The Company  does,
however, on occasion exceed the Federal Deposit Insurance Corporation
federally insured limits and at June 30, 1996 exceeded that amount by
approximately $209,000.


Note 1 - Organization and Significant Accounting Policies (continued)

Reclassifications

Certain accounts in the June 30, 1995 financial statements have  been
reclassified to conform to the June 30, 1996 presentation.

Note 2 - Continued Operations
The  accompanying financial statements have been prepared on a  going
concern  basis  which  contemplates the  realization  of  assets  and
liquidation  of liabilities in the ordinary course of  business.   In
prior  years, the Company had been in the development stage  and  did
not  begin  earning significant revenues until the middle  of  fiscal
year  end  1994.   During the year ended June 30, 1996,  the  Company
continued  to  suffer recurring losses from operations in  excess  of
$3,700,000,  resulting  in  an accumulated deficit  of  approximately
$10,518,000.  During the fiscal year ended June 30, 1995, the Company
did  complete an initial public offering.  However, cash  flows  from
operations  may  not be sufficient to meet the future obligations  of
the  Company.   Management is in the process of effecting  a  private
placement of the Company's common stock (Note 15).


Note 3 - Note Receivable

The  Company  made  advances  to and entered  into  a  joint  venture
agreement  with Commonwealth Group International, Inc. and  Frederick
C.  Sayle.  The note receivable bears interest at a rate of  10%  per
annum,  with  principal and interest payable by  September  1,  1996.
Additionally, the Company is entitled to 16.7% of the gross  revenues
from  agreements  with Commonwealth Group International,  Inc.  which
include  cable television and cellular communications licenses  owned
by CGI-UKRAINE Ltd and ASWEST, Commonwealth Group International, Inc.
joint venture partners.

The Company sold equipment to a customer for a total sales price of $
384,000.  $ 150,000 of the sales price was payable at the time of the
sale  or  no  later than six months from the date of  the  sale.  The
remaining  $ 234,000 is payable under the terms of a note  receivable
which  bears interest at 8.5%.  Principal and interest is payable  in
monthly installments of  approximately $ 4,773 through August, 2001.


Note 4 - Commitments and Contingencies

Capital Leases

The Company leases various office equipment which is accounted for as
capitalized  leases.  The following is a schedule of  future  minimum
capital  lease payments together with the net present  value  of  the
minimum lease obligation as of June 30, 1996.

      Year Ending June 30,
           1997                                 $7,438
           1998                                  2,526
           Total                                 9,964
           Less interest                        (1,638
                                              )

                                                $8,326

The assets recorded under capital leases are as follows:

      Furniture and fixtures                    $57,74
                                              0
      Less accumulated amortization             (28,15
                                              2)

                                                $29,58
                                              8
Amortization expense for equipment under capital lease was $7,780 and
$8,248 for the years ended June 30, 1996 and 1995, respectively.
Operating Leases
The  Company  leases  its facilities under a noncancelable  operating
lease  with a term of 5 years.  The minimum annual rent will increase
each  year  by  an  amount based in the Consumer  Price  Index.   The
Company is also responsible for paying its portion of the common area
maintenance, real estate taxes and insurance expenses.  Additionally,
the  Company also leases various office equipment under noncancelable
operating  leases with terms up to 4 years.  Rental expense  for  the
years  ended  June  30,  1996  and 1995  was  $106,705  and  $89,185,
respectively.
Future minimum lease commitments at June 30, 1996 are as follows:
      Year Ending June 30,
           1997                                $93,762
           1998                                 60,487
           1999                                  2,227

            Total  minimum lease payments      $156,47
required                                      6


Note 4 - Commitments and Contingencies (continued)

Employment Agreements

The  Company  has entered into three year employment agreements  with
their  four  officers commencing November 1, 1994.  Each  officer  is
entitled  to a first year salary of $105,000, increasing to  $120,000
in  the second year and $150,000 during the third year.  Each officer
is  granted options to purchase 10,000 shares of the Company's common
stock  pursuant  to  the Incentive Stock Option Plan  and  additional
options  to  purchase  10,000  shares  not  pursuant  to  any  plans.
Additionally, each officer is entitled to receive an incentive  bonus
computed  based upon annual Company revenues from operations  and  is
entitled  to  other  benefits,  including  an  automobile  allowance.
Effective October 1995, the officers salaries and bonuses pursuant to
the    terms   of   the  employment  agreements  have   been   waived
indefinitely.

Royalty Agreement

The  Company  has entered into an agreement with Telemac,  Inc.,  the
developer  of  the  software for real time billing.   This  agreement
provides for the Company to pay Telemac 7% of gross receipts based on
cellular telephone rentals.

Additionally,  the  Company  has  an  agreement  with  an  individual
requiring   payments   based  upon  the   net   profits   of   Cellex
Communications, Inc. (Cellex).  20% of Cellex's net profits are to be
remitted  to this individual pursuant to the terms of the  agreement.
As  of  June  30, 1996, Cellex has not posted a net profit  to  date,
however,  advances on future payments have been made. These  advances
amount to $ 8,200 and are included in prepaid assets.


Note 5 - Bank Line of Credit

The  Company maintains a secured revolving line-of-credit with a bank
with a limit of $250,000.  The balance at June 30, 1996 was $250,000.
The  line-of-credit is secured by a restricted certificate of deposit
with  a  balance  at  June 30, 1996 of $252,988.  The  line-of-credit
bears  interest at 5.65% payable monthly.  The line-of-credit expires
June 7, 1997.
Note 6 - Notes Payable
                                                           June 30,
                                                           1996
Promissory  note payable at 10%  interest
payable monthly commencing September  15,
1995.  Balance of principal is payable in
full  by  March 26, 1997.  As  additional
consideration, the Company agrees to  pay
the  note  holder  7.5%  of  all  profits
received through the Company's agreements                  $310,348
with  Commonwealth  Group  International,
Inc. (Note 3).

9.0%  Note payable - bank, principal  and
interest  payable in monthly installments
of    $3,157   through   January    1997.                    21,484
Collateralized by equipment.

8.5% Note payable - individual, principal
and    interest   payable   in    monthly
installments  of  $5,500  through   April                    52,341
1997.

Non  interest  bearing  note  payable   -
individual, principal payable in  monthly                    70,500
installments of $1,500 through June 2000.

11%  Note  payable - bank, principal  and
interest  payable in monthly installments
of    $541   through   June   14,   1998.                    12,041
Collateralized by equipment.
                                                            466,714
Less current maturities                                    (407,666
                                                           )

Total                                                      $ 59,048

Principal payment on notes payable subsequent to June 30, 1996 are as
follows:

          Year Ending June 30,

               1997                            $407,66
                                              6
               1998                             18,000
               1999                             16,500
               2000                             24,548

                                               $466,71
                                              4



Note 7 - Income Taxes

Deferred  tax  liabilities and assets are  determined  based  on  the
difference  between the financial statement and tax basis  of  assets
and  liabilities using enacted tax rates in effect for  the  year  in
which  the  differences are expected to reverse.  The measurement  of
deferred  tax assets is reduced, if necessary, by the amount  of  any
tax  benefits that, based on available evidence, are not expected  to
be realized.
The  principal temporary differences that will result in deferred tax
assets  and  liabilities are certain expenses and losses accrued  for
financial  reporting purposes not deductible for tax  purposes  until
paid,  depreciation  for tax purposes in excess of  depreciation  for
financial reporting purposes and the deferral of franchise costs  and
franchise  sales revenues for financial reporting purposes which  are
recognized  for tax purposes in the period paid.  The effect  of  the
differences outlined above generated a long-term deferred  tax  asset
that  is  fully  impaired because of a lack of  profitable  operating
history.  The fully impaired asset, computed at a 34 percent tax rate
at June 30, 1996 was approximately $3,136,817.  Accordingly, there is
no  net deferred tax asset reflected in the accompanying consolidated
financial statements.
The  components of the provision for income tax (benefit) expense for
the years ended June 30, 1996 and 1995 are as follows:
                                                   Years Ended
                                                                June
                                              30,
                                              1996         1995
Current                                              $     $     -
                                              -
Deferred                                                         -
                                              -

                                                     $     $     -
                                              -

The differences between the federal income tax rate and the effective
income  tax  rate  as  reflected in the  accompanying  statements  of
operations are:
                                                    Year Ended
                                                                June
                                              30,
                                              
                                              1996         1995

Statutory   federal   income   tax   rate
(benefit)                                     (34.0)%      (34.0)%
Valuation  allowance  for  net  operating                      34.0
loss                                          34.0

Effective tax rate (benefit)                        - %           - %
Note 7 - Income Taxes (continued)

The deferred tax asset consists of the following:
                                                            June 30,

                                                            1996

     Total long-term deferred tax asset                            $
                                                            3,576,22 2
     Valuation allowance
                                                            (3,576,2
                                                            22)
                                                            
                                                                   $ -
At  June 30, 1996, the Company has approximately $10,540,000  of  net
operating loss carryforwards for income tax reporting purposes  which
expire  in  2007 through 2011.  During 1995, there was  a  change  in
ownership  due  to the initial public offering, which could  restrict
the utilization of net operating loss carryforwards in the future.


Note 8 - Related Party

Sales

During  the year ended June 30, 1996, the Company sold equipment  and
other  technology to Lonestar, Inc., an entity owned entirely by  the
officers  of the Company.  The sales price was $350,000 and was  used
to satisfy $350,000 of officer advances payable


Note 9 - Stock Option and Bonus Plans

The Company has an Incentive Stock Option Plan, a Non-Qualified Stock
Option  Plan and a Stock Bonus Plan.  A summary description  of  each
Plan follows.

Incentive Stock Option Plan

The  Incentive  Stock Option Plan authorizes the issuance  of  up  to
1,500,000  shares  of  the Company's Common  Stock  to  persons  that
exercise  options granted pursuant to the Plan.  It became  effective
on  April  15,  1993 and will remain in effect until April  15,  2001
unless  terminated  earlier by action of the Board.   Only  officers,
directors  and  key employees of the Company may be  granted  options
pursuant to the Incentive Stock Option Plan.


Note 9 - Stock Option and Bonus Plans (continued)

Incentive Stock Option Plan (continued)

The total fair market value of the shares of Common Stock (determined
at the time of the grant of the option) for which any employee may be
granted options which are first exercisable in any calendar year  may
not exceed $100,000.

Options  may  not be exercised until one year following the  date  of
grant.   Options granted to an employee then owning more than 10%  of
the  Common Stock of the Company may not be exercisable by its  terms
after five years from the date of grant.

The  purchase  price per share of Common Stock purchasable  under  an
option is determined by a committee but cannot be less than the  fair
market  value  of the Common Stock on the date of the  grant  of  the
option  (or  110% of the fair market value in the case  of  a  person
owning  the  Company's stock which represents more than  10%  of  the
total combined voting power of all classes of stock).

Non-Qualified Stock Option Plan

The Non-Qualified stock Option Plan authorizes the issuance of up  to
1,500,000  shares  of  the Company's Common  Stock  to  persons  that
exercise  options granted pursuant to the Plan.  It became  effective
April  15, 1993 and will remain in effect until April 15, 2001 unless
terminated  earlier  by  the  Board  of  Directors.   The   Company's
employees, directors, officers, consultants or advisors are  eligible
to  be  granted options pursuant to this Plan, provided however  that
bona  fide services must be rendered by such consultants or  advisors
and such services must not be in connection with the offer of sale of
securities  in  a  capital-raising transaction.  The option  exercise
price is determined by a Committee but cannot be less than the market
price  of  the  Company's  Common Stock on the  date  the  option  is
granted.
The  Company has the following stock options outstanding at June  30,
1996.
Options      Exercise      Expirati      Currentl
                              on            y
Outstand
ing          Price         Date          Exercisa
                                         ble

                     $                    90,000
90,000       5.50          1999
                                          90,000
90,000       6.50          1999

                                         180,000
180,000


Note 9 - Stock Option and Bonus Plans (continued)

Non-Qualified Stock Option Plan (continued)

                                               Number        Price
                                                 of           Per
                                              Shares       Shares
Options outstanding June 30, 1995               180,00     $
                                              0            5.50-
                                                           6.50
    Granted                                         -            -
    
Options outstanding June 30, 1996               180,00     $
                                              0            5.50-
                                                           6.50

Stock Bonus Plan

Up to 3,000,000 shares of Common Stock may be granted under the Stock
Bonus  Plan.   Such  shares may consist, in  whole  or  in  part,  of
authorized but unissued shares, or treasury shares.  Under the  Stock
Bonus Plan, the Company's employees, directors, officers, consultants
and advisors are eligible to receive a grant of the Company's shares;
provided,  however,  that  bona fide services  must  be  rendered  by
consultants  or advisors and such services must not be in  connection
with   the   offer   or  sale  of  securities  in  a  capital-raising
transaction.


Note 10 - Stockholders' Equity

During  the  fiscal  year  ended June 30, 1995,  the  Company  had  a
successful  public  offering  for 1,811,250  units,  with  each  unit
consisting of one share of common stock, one Series A Warrant and one
Series  B  Warrant.   The  Series A Warrants entitle  the  holder  to
purchase  one  share of Common Stock at $70.00 per  share  for  three
years.   The  Series B Warrants entitle the holder  to  purchase  one
share  of Common Stock for $90.00 for three years.  Proceeds  to  the
Company amounted to $5,239,437, net of offering costs of $1,099,938.
In  addition,  in  1995 the Company converted $145,000  of  debt  and
$37,651  of accrued interest into 274,660 shares of common  stock  at
$.67 per share.
In  1995,  the  Company issued 91,170 shares of the Company's  common
stock  for  $.67  to  $1.00  per share for  a  total  of  $62,026  as
inducements  to various individuals to provide loans to the  Company.
As  the  underlying notes matured or were paid off prior to June  30,
1995, the $62,026 was recorded as interest expense.
In  1995, the Company determined that an additional 54,330 shares  of
the  Company's  common stock would need to be to be issued  to  three
individuals pursuant to valuation guarantees relating to the  initial
public offering.


Note 10 - Stockholders' Equity (continued)

In 1995, the Company agreed to issue 24,250 shares of Series A, $.001
par  value  convertible, 8% preferred stock in conjunction  with  the
repurchase  of certain franchises valued at $245,000.   At  any  time
after July 1, 1999, each share of the Series A preferred stock can be
converted into .8 shares of the Company's common stock.

In  1996,  the Company agreed to issue an additional 1,000 shares  of
the Series A preferred stock as payment for the repurchase of certain
franchises valued at  $ 20,000.

In  1996, the Company converted $ 362,000 of officer advances payable
into  175,110  shares of the Company's common stock  at  $  2.07  per
share.

In  1996, the Company issued 1,365,000 shares of the Company's common
stock at $1 per share for a total of $ 1,365,000 as compensation  for
services from officers and other employees.

In  1996,  the  Company agreed to issue 100,000 shares of  $.001  par
value  Series B convertible preferred stock as repayment  of  certain
officer  advances  payable valued at $ 100,000.  Each  share  of  the
Series  B  preferred stock can be converted into  one  share  of  the
Company's common stock at the option of the holder.

In  1996,  the Company issued 419,940 shares of its common  stock  in
repayment of loans of $209,970 from certain officers.

In  1996, certain officers of the Company forgave $124,294 of officer
advances  payable  and $400,000 of accrued salaries.   For  financial
statement purposes this amount has been treated as a contribution  to
capital.


Note 11 - Stock Splits

The  Company in October 1994 declared a 3 for 2 stock split, in  June
1995 declared a 2 for 1 stock split, and in March 1996 declared  a  1
for 10 reverse stock split.  Accordingly, all weighted average share,
per   share   and  option  information  throughout  the  consolidated
financial statements has been restated to reflect these splits.


Note 12 - Significant Customers

As  of June 30, 1996, One individual accounted for $ 50,000 (62%)  of
franchise  and  royalty  revenue. One  Corporation  accounted  for  $
384,000 (46%) of equipment and other revenue.  Another franchisee and
stockholder  accounts  for  $  724,264 (83%)  of  the  franchise  and
customer deposits.


Note 12 - Significant Customers (continued)

As  of  June 30, 1995, one franchisee accounted for $24,500 (54%)  of
franchise revenue and $125,800 (46%) of equipment and other  revenue.
Another franchisee and stockholder accounts for $727,750 (71%) of the
franchise and customer deposits.


Note 13 - Business Segments

The  Company's  principal operations are in the  cellular  technology
industry.   In  prior  years, the Company also generated  significant
revenues   from  the  franchising  of  cellular  related  technology.
However,   the  Company  changed  their  business  focus,  therefore,
franchising no longer generates significant revenues or losses.   The
Company still is involved in minimal franchising activities, however,
franchising  is no longer considered a significant segment  and  does
not require separate disclosures.


Note 14 - Litigation

A  matter  is  pending in state court in Palm Beach County,  Florida,
whereby  the  plaintiff  seeks damages in excess  of  $3,800,000  for
breach of agreement.  The Company has filed an Answer and Affirmative
Defenses  denying  the claims and intends to continue  to  vigorously
defend themselves against these claims.  The financial statements  do
not  include  any adjustments that might result from the  outcome  of
this uncertainty.

Additionally,  a franchisee has demanded that the Company  repurchase
his  franchises for approximately $1,000,000 or a suit for breach  of
the  franchise  agreement will be filed.  The  Company  is  currently
negotiating  a  settlement  and  has approximately  $770,000  accrued
relating to this obligation.


Note 15 - Subsequent Events

Private Placement

In  September  1996,  the Company offered, in  a  private  placement,
800,000 shares of Company stock at $.50 per share.  The placement  is
limited  to accredited individual investors with a minimum investment
of $25,000.