<PAGE>

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

                                  UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549

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

                                    FORM 10-Q

     [X]  QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
          EXCHANGE ACT OF 1934

               FOR THE FISCAL QUARTER ENDED SEPTEMBER 30, 1996, OR

     [ ]  TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
          EXCHANGE ACT OF 1934

               For the Transition period from _____ to _________.
                        Commission file number:  0-26952


                               SYNC RESEARCH, INC.
             (Exact name of Registrant as specified in its charter)

                Delaware                          33-0676350
     (State or other jurisdiction of           (I.R.S. Employer
     incorporation or organization)           Identification No.)

                                    40 Parker
                                Irvine, CA  92618
                    (Address of principal executive offices)
       Registrant's telephone number, including area code:  (714) 588-2070

                                   7 Studebaker
 ,                                 Irvine, CA 92618
                  (former address, if changed since last report)
                     --------------------------------------


Indicate by check mark whether the Registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934, as
amended (the "Exchange Act") during the preceding 12 months (or for such shorter
period that the Registrant was required to file such reports) and (2) has been
subject to such filing requirements for the past 90 days.

YES   X           NO
     ----            ----

     As of November 8, 1996, 16,674,766 shares of the Registrant's Common Stock
were issued and outstanding.


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

<PAGE>

SYNC RESEARCH, INC.




INDEX


                                                                            PAGE
                                                                            ----


Part I.        Financial Information                                          3


     Item 1.   a)   Condensed consolidated balance sheets at
                    September 30, 1996 (unaudited) and December 31, 1995      3

               b)   Condensed consolidated statements of operations
                    (unaudited) for the three and nine months ended
                    September 30, 1996 and September 30,1995                  4

               c)   Condensed consolidated statements of cash flows
                    (unaudited) for the nine-month periods ended
                    September 30, 1996 and September 30, 1995                 5

               d)   Notes to condensed consolidated financial statements      6


     Item 2.        Management's Discussion and Analysis of Financial
                    Condition and Results of Operations                       9


Part II.            Other Information                                        22


                                       -2-
<PAGE>

PART I.  FINANCIAL INFORMATION

ITEM 1.  FINANCIAL STATEMENTS

SYNC RESEARCH, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(IN THOUSANDS, EXCEPT PER SHARE AMOUNTS)

ASSETS

                                                   SEPTEMBER 30,    DECEMBER 31,
                                                   1996             1995*
                                                   -------------    ------------
                                                   (UNAUDITED)

Current assets:
   Cash and cash equivalents                           $ 24,758        $ 50,633
   Short-term investments                                12,751              --
   Accounts and other receivables, net                    7,874           7,803
   Inventories                                            6,356           5,256
   Prepaid expenses and other current assets                536             389
                                                       --------        --------
Total current assets                                     52,275          64,081

Furniture, fixtures and equipment, net                    3,539           2,239
Other assets                                                361             352
                                                       --------        --------
      Total assets                                     $ 56,175        $ 66,672
                                                       --------        --------
                                                       --------        --------

LIABILITIES AND STOCKHOLDERS' EQUITY


Current liabilities:
   Accounts payable and accrued liabilities            $  5,127        $  5,643
   Bank borrowings and current maturities
      of capitalized lease obligations                      852             176
                                                       --------        --------

Total current liabilities                                 5,979           5,819

Capitalized lease obligations, less current maturities      157             398

Series B mandatorily redeemable preferred stock              --           5,591

Common stockholders' equity:
   Common stock, $.001 par value:
      Authorized shares--50,000
      Issued and outstanding shares--
      16,486  at September 30, 1996
      and 15,833 at December 31, 1995                        16              16
   Additional paid-in capital                            70,722          68,429
   Deferred compensation                                   (197)           (421)
   Accumulated deficit                                  (20,502)        (13,160)
                                                       --------        --------
Total common stockholders' equity                        50,039          54,864
                                                       --------        --------

Total liabilities and common stockholders' equity      $ 56,175        $ 66,672
                                                       --------        --------
                                                       --------        --------

*  December 31, 1995 figures are derived from the audited, fiscal year-end
   balance sheets of Sync Research, Inc. at December 31, 1995 and TyLink
   Corporation at March 31, 1996.


See accompanying notes.


                                       -3-
<PAGE>

SYNC RESEARCH, INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(UNAUDITED)
(IN THOUSANDS, EXCEPT PER SHARE AMOUNTS)


<TABLE>
<CAPTION>
                              THREE MONTHS ENDED           NINE MONTHS ENDED
                              SEPTEMBER 30,                SEPTEMBER 30,
                              -------------------------    --------------------------
                                    1996           1995           1996           1995
                              ----------     ----------    -----------     ----------
<S>                           <C>            <C>           <C>             <C>
Net revenues                     $ 9,251        $ 9,439        $25,915        $24,537

Cost of sales                      4,976          4,901         14,395         12,271
                              ----------     ----------    -----------     ----------
   Gross profit                    4,275          4,538         11,520         12,266

Operating expenses:
   Research and development        1,921          1,436          5,400          4,147
   Selling and marketing           3,832          2,841         10,674          7,942
   General and administrative      2,534            815          4,777          2,204
                              ----------     ----------    -----------     ----------

   Total operating expenses        8,287          5,092         20,851         14,293
                              ----------     ----------    -----------     ----------

Operating loss                    (4,012)          (554)        (9,331)        (2,027)
Interest expense                     (28)           (30)           (65)           (73)
Interest income                      559             51          1,831            196
                              ----------     ----------    -----------     ----------

Loss before income taxes          (3,481)          (533)        (7,565)        (1,904)

Provision for income taxes             2             10              2              -
                              ----------     ----------    -----------     ----------

Net loss                         $(3,483)         $(543)       $(7,567)       $(1,915)
                              ----------     ----------    -----------     ----------
                              ----------     ----------    -----------     ----------

Net loss per share                $(0.23)        $(0.12)        $(0.52)        $(0.47)
                              ----------     ----------    -----------     ----------
                              ----------     ----------    -----------     ----------

Shares used in computing net
   loss per share                 16,183          6,732         16,068          6,606
                              ----------     ----------    -----------     ----------
                              ----------     ----------    -----------     ----------

Pro forma net loss per share                     $(0.06)                       $(0.22)
                                             ----------                    ----------
                                             ----------                    ----------
Shares used in computing pro forma
   net loss per share                            14,335                        14,209
                                             ----------                    ----------
                                             ----------                    ----------
</TABLE>


See accompanying notes.


                                       -4-
<PAGE>

SYNC RESEARCH, INC.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(UNAUDITED)
(IN THOUSANDS)
<TABLE>
<CAPTION>
                                                     NINE MONTHS ENDED SEPTEMBER 30,
                                                     -------------------------------
                                                           1996          1995
                                                         --------      --------
<S>                                                   <C>              <C>
CASH FLOWS FROM OPERATING ACTIVITIES
  Net loss                                               $ (7,567)     $ (1,915)
  TyLink net loss for the three months ended
  March 31, 1996                                              711            --
  Adjustments to reconcile net loss to net cash
  used in operating activities:
    Depreciation and amortization                             699           474
    Provision for losses on accounts receivable               347            69
    Stock issued in lieu of payment for services               --           175
    Deferred compensation expense                             224           128
    Changes in operating assets and liabilities            (2,190)       (1,557)
                                                         --------      --------
Net cash used in operating activities                      (7,776)       (2,626)

CASH FLOWS FROM INVESTING ACTIVITIES
  Investments in marketable securities, net               (12,751)           --
  Purchases of furniture, fixtures and equipment           (1,966)         (910)
                                                         --------      --------
Net cash used in investing activities                     (14,717)         (910)

CASH FLOWS FROM FINANCING ACTIVITIES
  Repurchase of Series B preferred stock                   (4,000)           --
  Net bank borrowings                                         802           287
  Payments on capitalized lease obligations                  (400)          (82)
  Proceeds from common stock options exercised                216            60
  Proceeds from sale of restricted stock                       --           115
                                                         --------      --------
Net cash provided by (used in) financing activities        (3,382)          380
                                                         --------      --------

Net decrease in cash and cash equivalents                 (25,875)       (3,156)
Cash and cash equivalents at beginning of period           50,633         8,512
                                                         --------      --------

Cash and cash equivalents at end of period               $ 24,758      $  5,356
                                                         --------      --------
                                                         --------      --------


SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION
    Interest paid                                        $     90      $     74
                                                         --------      --------
                                                         --------      --------

    Income taxes paid                                    $     41      $      2
                                                         --------      --------
                                                         --------      --------
</TABLE>

See accompanying notes.


                                       -5-
<PAGE>

SYNC RESEARCH, INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)


ITEM 1.   SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

1.        BASIS OF PRESENTATION

          On August 23, 1996, Sync Research, Inc. ("Sync" or the "Company")
acquired TyLink Corporation ("TyLink"), pursuant to a merger (the "Merger") of a
wholly-owned subsidiary of the Company with and into TyLink.  In the Merger, the
Company exchanged 2,148,168 shares of its common stock for all of the
outstanding shares of TyLink common and Series A preferred stock and reserved
423,155 shares of Sync common stock for issuance upon exercise of TyLink
options, which were assumed by the Company.  In addition, Sync acquired all of
the issued and outstanding Series B preferred stock for $4 million in cash and
208,677 shares of Sync common stock. The merger has been accounted for as a 
pooling of interests. Accordingly, the accompanying financial statements 
reflect the combination of Sync and Tylink for all periods presented.

          The condensed consolidated balance sheets as of September 30, 1996, 
the condensed consolidated statements of operations for the three and nine 
months ended September 30, 1996 and 1995 and the condensed consolidated 
statements of cash flows for the nine month periods ended September 30, 1996 
and 1995 have been prepared without audit.  In the opinion of management, the 
unaudited financial statements include all adjustments (consisting of normal 
recurring adjustments) necessary to present fairly the financial position at 
September 30, 1996, the results of operations for the three and nine-months 
ended September 30, 1996 and 1995 and cash flows for the nine month ended 
September  30, 1996 and 1995.  The condensed financial statements should be 
read in conjunction with the audited financial statements of Sync Research, 
Inc. and notes thereto included in the Company's Annual Report on Form 10-K 
for the year ended December 31, 1995 and the audited financial statements of 
TyLink Corporation and notes thereto included in the Company's current report 
on Form 8-K, as amended, dated August 23, 1996.  The results of operations 
for the three months and nine months ended September 30, 1996 are not 
necessarily indicative of the operating results to be expected for the full 
year.

          The preparation of financial statements in conformity with 
generally accepted accounting principles requires management to make 
estimates and assumptions that affect the amounts reported in the 
accompanying financial statements. Actual results could differ from those 
estimates.

          Sync results for the three and nine month periods ended September 30,
1995 have been combined with TyLink results for the three and nine month periods
ended December 31, 1995, respectively.  Revenues and net income for Sync, TyLink
and on a combined basis for the six months ended June 30, 1996 and the nine
months ended September 30, 1995 are as follows (in thousands):

                                      Six months ended         Nine months ended
                                        June 30, 1996         September 30, 1995
                                      ----------------        ------------------
Revenues
     Sync                                  $10,079                  $15,832
     TyLink                                  6,585                    8,705
                                           -------                  -------
Combined                                   $16,664                  $24,537
                                           -------                  -------
                                           -------                  -------

Net income (loss)
     Sync                                  $(3,101)                    $285
     TyLink                                   (983)                  (2,200)
                                           -------                  -------
Combined                                   $(4,084)                 $(1,915)
                                           -------                  -------
                                           -------                  -------


                                       -6-
<PAGE>

Sync and TyLink have incurred direct transaction costs of approximately $1.3
million associated with the Merger consisting of transaction fees for investment
bankers, attorneys, accountants, financial printing and other related charges.
These nonrecurring transaction costs have been recorded in the accompanying
statements of operations for the three and nine months ended September 30, 1996.

2.        CASH, CASH EQUIVALENTS AND SHORT-TERM INVESTMENTS

          The Company invests its excess cash in money market funds and debt
instruments of U.S. corporations with strong credit ratings.  The Company has
established guidelines with respect to the diversification and maturities in
order to maintain safety and liquidity.  The Company considers all highly liquid
investments with an original maturity of three months or less to be cash
equivalents.  The Company considers investments with original maturities between
three and twelve months to be short-term investments.  Management determines the
appropriate classification of such securities at the time of purchase and
reevaluates such classification as of each balance sheet date.  Based on its
intent, the Company's investments are classified as available-for-sale and are
carried at fair value, with unrealized gains and losses, net of tax, reported as
a separate component of stockholders' equity.  The investments are adjusted for
amortization of premiums and discounts to maturity and such amortization is
included in interest income.  Realized gains and losses and declines in value
judged to be other than temporary are determined based on the specific
identification method and are reported in the consolidated statements of
operations.  There were no significant unrealized gains or losses at
September 30, 1996.

3.        INVENTORIES

          Inventories consist primarily of computer hardware and components and
are stated at the lower of cost (first-in, first-out) or market as follows (in
thousands):

                                                   SEPTEMBER 30,    DECEMBER 31,
                                                       1996             1995
                                                     -------          -------
          Raw Materials                               $3,823           $2,656
          Work in Process                                683              862
          Finished Goods                               1,850            1,738
                                                      ------           ------
                                                      $6,356           $5,256
                                                      ------           ------
                                                      ------           ------

4.        EARNINGS PER SHARE

          Net loss per share is computed using the weighted average number of 
common shares and common share equivalents outstanding during the periods 
presented and includes the accretion of Series B preferred stock redemption 
value and cumulative dividends.  The accretion for the three months ended 
September 30, 1996 and 1995 and the nine months ended September 30, 1996 and 
1995 was $242,000 $292,000, and $775,000 and $1,221,000, respectively.  
Common stock equivalents result from the dilutive effect, if any, of 
outstanding options and warrants to purchase common stock.  Pursuant to the 
requirements of the Securities and Exchange Commission (SEC), common shares 
issued by the Company during the twelve months immediately preceding the 
Company's initial offering, plus the number of equivalent shares resulting 
from stock options and warrants granted during this period, have been 
included in the calculation of the shares used in computing net loss per 
share as if they were outstanding for all of fiscal 1995 (using the treasury 
stock method and the estimated public offering price in calculating 
equivalent shares).  Pro forma net loss per

                                       -7-
<PAGE>


share also includes 7,603,240 weighted average shares of common stock in 1995 as
if the conversion of preferred stock occurred at the beginning of that year.

5.        IMPACT OF RECENTLY ISSUED ACCOUNTING STANDARDS

          On January 1, 1996, the Company adopted the FASB Statement of
Financial Accounting Standards No. 121 (SFAS 121), ACCOUNTING FOR THE IMPAIRMENT
OF LONG-LIVED ASSETS AND FOR LONG-LIVED ASSETS TO BE DISPOSED OF.  The adoption
of SFAS 121 had no impact on the Company's financial condition or results of
operations.

          In October 1995, Statement of Financial Accounting Standards No. 123,
"Accounting for Stock Based Compensation" (FAS 123) was issued and is effective
for 1996.  The Company intends to continue to account for employee stock options
in accordance with APB Opinion No. 25 and will make the pro forma disclosures
required by FAS 123 in its annual financial statements for 1996; accordingly,
the adoption of the standard will not have a material effect on the Company's
financial position or results of operations.


                                       -8-
<PAGE>

ITEM 2.   MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
          RESULTS OF OPERATION

     The following discussion should be read in conjunction with the 
unaudited condensed consolidated financial statements and notes thereto 
included in Part I--Item 1 of this Quarterly Report.  In addition, except for 
the historical statements contained therein, the following discussion 
contains forward-looking statements. The Company wishes to alert readers that 
the factors set forth in the Company's Annual Report on Form 10-K for the 
year ended December 31, 1995, and in the section of this Item 2 titled 
"Additional Factors That May Affect Future Results," as well as other 
factors, could in the future affect, and in the past have affected, the 
Company's results.  The Company's actual results for future periods could 
differ materially from those expressed in any forward-looking statements made 
by or on behalf of the Company.

ACQUISITION OF TYLINK CORPORATION

     On August 23, 1996, Sync Research, Inc. ("Sync" or the "Company") acquired
TyLink Corporation ("TyLink"), pursuant to a merger (the "Merger") of a wholly-
owned subsidiary of the Company with and into TyLink.  In the Merger, the
Company exchanged 2,148,168 shares of its common stock for all of the
outstanding shares of TyLink common and Series A preferred stock and reserved
423,155 shares of Sync common stock for issuance upon exercise of TyLink
options, which were assumed by the Company.  In addition, Sync acquired all of
the issued and outstanding Series B preferred stock for $4 million in cash and
208,677 shares of Sync common stock. The merger has been accounted for as 
pooling of interest. Accordingly, the accompanying financial statements 
reflect the combination of Sync and Tylink for all periods presented.

OVERVIEW

     Sync Research, Inc. ("Sync" or the "Company") is a wide-area network
("WAN") access company, providing internetworking solutions for International
Business Machines Corporation ("IBM") customers' wide-area networks.  Sync
develops, markets and supports advanced networking products that adapt IBM
Systems Network Architecture ("SNA") networks to emerging switched WAN services
such as Frame Relay.  Sync products also support the integration of the
installed-base SNA and emerging client/server network applications using these
new WAN services.  Industry analysts have estimated that there are approximately
50,000 IBM SNA networks worldwide.  In these networks, wide-area circuit costs
are significant.  Frame Relay has emerged as a less expensive, more efficient,
direct substitute for such traditional leased-line connections.  The market for
Frame Relay services and equipment is expected to exceed $5 billion in 1998, and
it is estimated that more than half of all data traffic on Frame Relay networks
in 1999 will be attributable to SNA.  As a Frame Relay pioneer, the Company was
an early developer of SNA-over-Frame Relay solutions, which provided the basis
for Sync's current product family.  The Company believes it is a recognized
leader in SNA-centric networking solutions.

     The Company has established strategic sales channels to its prospective
market through marketing and sales relationships with selected, leading
communications and networking companies.  The Company intends to leverage its
expertise in SNA-based networks to develop additional channel partnerships and
other marketing relationships, while maintaining direct sales, marketing and
systems engineering activities in order to respond directly to end user needs
and to support the sales efforts of its channel partners.

     Sync's TyLink Product Group develops multiservice WAN transmission and
circuit management products for mission-critical network applications.  These
products offer end-users and service providers high performance access to
digital carrier services (transmission product) and proactive management,


                                       -9-
<PAGE>


diagnosis and capacity planning for public, private and hybrid frame relay
networks (circuit management product).

     There can be no assurance that the operations and personnel of TyLink 
will be successfully assimilated into the Company's business.  The risks 
associated with the Merger include the potential disruption of the respective 
ongoing businesses of TyLink and the Company, the inability of the Company's 
management to maximize the financial and strategic position of the combined 
entity through successful incorporation of TyLink's personnel and clients, 
the inability to implement uniform standards, controls, procedures and 
policies and the impairment of relationships with existing employees and 
clients as a result of the Company's integration of new management personnel. 
These factors could have a material adverse effect on the Company's business, 
financial condition and operating results.

RESULTS OF OPERATIONS

     NET REVENUES

     The Company derives its revenues primarily from sales of advanced wide-area
networking products, which are recognized upon shipment. The Company generally
does not have any significant remaining obligations upon shipment of its
products. Product returns and sales allowances are provided for at the date of
sale. Service revenues from customer maintenance fees for ongoing customer
support and product updates, which have not been material to date, are
recognized ratably over the term of the maintenance period, which is typically
12 months.

     Net revenues for the third quarter of 1996 were $9.3 million, a decrease 
of 2% from the net revenues of $9.4 million for the third quarter of 1995.  
For the nine months ended September 30, 1996, net revenues were $25.9 million 
or 6% higher than the net revenues of $24.5 million in the same period in the 
prior year.  The lower net revenues for the third quarter and nine months 
ended September 30, 1996 reflect lower sales of the traditional products 
(conversion and transmission products) and lower average selling prices 
partially offset by increased customer acceptance of the newer frame relay 
access and circuit management products. Sales of the Company's frame relay 
access products represented approximately 49% of total net sales for the 
third quarter and 41% of total net sales for the nine months ended September 
30, 1996 as compared to 19% and 19% for the comparable prior year periods.  
Sales of the Company's circuit management products represented 21% and 18% of 
net revenues for the third quarter and nine months ended September 30, 1996, 
respectively, as compared to 8% and 6% in the comparable prior year periods.  
Sales of the Company's transmission products represented 13% and 15% of net 
revenues for the third quarter and nine months ended September 30, 1996, 
respectively, as compared to 17% and 22% in the comparable prior year 
periods.  The Company expects that average selling prices will continue to 
decline.  Sales of frame relay access products and circuit management 
products are expected on a forward-looking basis to grow as a percentage of 
net sales and transmission and conversion products revenues are expected to 
decline.

                                      -10-
<PAGE>


     GROSS PROFIT

     Cost of sales primarily consists of purchased materials used in the
assembly of the Company's products and compensation paid to employees in the
Company's manufacturing organization.

     Gross profit decreased to $4.3 million for the third quarter of 1996 
from $4.5 million in the third quarter of 1995, due primarily to lower net 
sales, lower average selling prices, especially in transmission products 
which faced severe price pressure in the marketplace, and increases in the 
percentage of sales of frame relay access products through channel partners 
and other resellers, which typically have lower margins than direct sales, 
partially offset by lower manufacturing costs.  For the nine months ended 
September 30, 1996, gross profits decreased to $11.5 million as compared to 
$12.3 million in the prior year period primarily because of increases in the 
percentage of sales to channel partners and other resellers and lower average 
selling prices, partially offset by increased net revenue and lower 
manufacturing costs.

     Gross profit as a percentage of net sales decreased to 46.2% and 44.5% for
the three and nine months ended September 30, 1996, respectively, as compared to
48.1% and 50.0% for the comparable prior year periods due primarily to increases
in the percentage of sales of frame relay access products to channel partners
and resellers and lower average prices, partially offset by lower manufacturing
costs.

     OPERATING EXPENSES

     Research and development expenses primarily consist of compensation paid to
personnel, including consultants, engaged in research and development, amounts
paid for outside development services; costs of materials utilized in the
development of hardware products, including prototype units; and license fees
and other payments to acquire rights to technology.  The Company expenses all
research and development costs as incurred.  Research and development expenses
increased in the three and nine months ended September 30, 1996 to $1.9 million
and $5.4 million, respectively, as compared to $1.4 million and $4.1 million in
the comparable prior year periods.  The increased expenses in the current year
were primarily due to the addition of personnel for the development of new
products and the continued enhancement of existing products.  The Company
believes that significant research and development efforts are necessary in
order for it to compete in the evolving marketplace in which it operates.
Accordingly, if the Company is successful in hiring additional development
engineers, research and development expenditures are expected, on a forward
looking basis, to continue to increase in absolute dollars.

     Selling and marketing expenses consist primarily of base and incentive
compensation paid to sales and marketing personnel, travel and related expenses,
and costs associated with promotional and trade show activities.  Selling and
marketing expenses increased to $3.8 million for the third quarter of 1996 and
$10.7 million for the nine months ended September 30, 1996 as compared to $2.8
million and $7.9 million for the third quarter of 1995 and the nine months ended
September 30, 1995, respectively.  The increased expenses principally reflected
increased hiring and personnel-related expenses associated with the build-up of
the Company's sales organization.

     General and administrative expenses consist primarily of compensation paid
to administrative personnel, payments to consultants and for professional
services, and costs incurred in recruiting senior management personnel.  General
and administrative expenses increased to $2.5 million and $4.8 million for the
three and nine months ended September 30, 1996, respectively, as compared with
$0.8 million and $2.2 million for the comparable prior year periods in 1995.
The increases were primarily due to


                                      -11-
<PAGE>


expenditures incurred in connection with the Merger aggregating approximately
$1.3 million, increased administrative personnel costs, and costs related to
public company and investor relation activities since the Company completed its
initial public offering in November 1995.

     The Company recorded deferred compensation of $644,000 during 1995 for the
difference between the option exercise price or restricted stock price and the
deemed fair value of the Company's Common Stock for options granted and
restricted stock sold in 1995.  The deferred compensation is being amortized to
operating expense and cost of sales over the related 48-month vesting period of
the shares and will, therefore, continue to have an adverse effect on the
Company's results of operations.  Included in operating expenses and cost of
sales for the three and nine months ended September 30, 1996 were $49,000 and
$224,000 of such expenses, respectively, as compared to $95,000 and $128,000 for
the comparable prior year periods.

     Net interest income was $0.5 million in the third quarter of 1996 and $1.8
million for the nine months ended September 30, 1996 as compared to $21,000 and
$123,000 respectively, in the comparable prior year periods, as a result of
significantly higher cash balances from the Company's initial public offering in
November 1995.

     INCOME TAXES

     The provisions for income taxes in 1996 and 1995 represent minimum state
taxes and federal and state alternative minimum taxes, respectively.

LIQUIDITY AND CAPITAL RESOURCES

     As of September 30, 1996, the Company's principal sources of liquidity
consisted of $24.8 million of cash and cash equivalents, and $12.7 million of
short-term investments.

     As of September 30, 1996, $12.7 million of the Company's cash was 
invested in high grade commercial paper with maturities of more than three 
months.  Also, during the nine months ended September 30, 1996, cash utilized 
by operating activities was $7.8 million, compared to $2.6 million for the 
nine months ended September 30, 1995.  Cash utilized during the nine month 
period ended September 30 1996 was due primarily to the Company's net loss, a 
reduction in accounts payable and accrued liabilities and an increase in 
inventory of $ 7.6 million, $0.5 million and $1.1 million, respectively.  
These changes reflected the higher operating loss, lower level of purchasing 
and related payables, higher levels of inventory and slower collections of 
accounts receivable in the first nine months of 1996.  In addition, the 
Company paid the holders of TyLink Series B preferred stock an aggregate of 
$4 million in cash as partial consideration for the acquisition of their 
shares.  Capital expenditures during the first nine months of 1996 were $2.0 
million, compared to $0.9 million for the prior year period, which reflects 
the computer hardware support of increased staffing, and the establishment of 
improved hardware and software test capability.

     The Company has entered into a new seven year real estate lease and will
relocate its primary operations during the fourth quarter of 1996.  Therefore,
the Company expects, on a forward looking basis, that lease, operating and
maintenance costs will increase in future periods.  In addition, the Company
anticipates that it will expend approximately $1.0 million for leasehold
improvements for the facility.


                                      -12-
<PAGE>

ADDITIONAL FACTORS THAT MAY AFFECT FUTURE RESULTS

     The Company desires to take advantage of the "safe harbor" provisions of
the Private Securities Litigation Reform Act of 1995.  Specifically, the Company
wishes to alert readers that, except for the historical information contained
herein, the above discussion under "Acquisition of TyLink Corporation," "Results
of Operations" and "Liquidity and Capital Resources" constitutes forward-looking
statements that are dependent on certain risks and uncertainties.  These and
other factors that may cause actual results to differ materially from those
expressed in any forward-looking statements made by or on behalf of the Company
are described below and in the Company's Annual Report on Form 10-K for the year
ended December 31, 1995, in the section titled "Management's Discussion and
Analysis of Financial Condition and Results of Operations -- Risk Factors."

     HISTORY OF LOSSES; SIGNIFICANT FLUCTUATIONS IN OPERATING RESULTS; UNCERTAIN
     PROFITABILITY

     The Company experienced operating losses in fiscal years 1991, 1992, 1993,
1994, and 1995 and operating losses for the nine months ended September 30,
1996.  As of September 30, 1996, the Company had an accumulated deficit of
approximately $20.5 million.  The Company has experienced, and may in the future
experience, significant fluctuations in revenues and operating results from
quarter to quarter and from year to year due to a combination of factors.
Factors that can cause the Company's revenues and operating results to vary
significantly from period to period include: the timing of significant orders;
competition and pricing in the industry; the Company's success in developing,
introducing and shipping new products; increases in the length of the sales
cycles for the Company's products; new product introductions by the Company's
competitors; announcements by IBM relating to products, services or pricing
relevant to the Company; production or quality problems; changes in material
costs; disruption in sources of supply; and general economic conditions.  In
addition, revenues and gross margins may fluctuate due to the mix of
distribution channels employed and the mix of products sold.  For example, the
Company generally realizes a higher gross margin on direct sales than on sales
through its channel partners and other resellers.  Accordingly, as channel
partners and other resellers continue to account for a substantial majority of
the Company's net revenues, gross profit as a percentage of net revenues may
decline.

     The Company's future revenues are difficult to predict.  Revenues and
operating results in any quarter depend on the volume and timing of, and the
ability to fulfill, orders received within the quarter.  In addition, sales of
the Company's products typically involve a sales cycle of several months from
the point of initial customer contact until receipt of the first system order.
There can be no assurance that average sales cycles will not increase in future
periods.  Furthermore, due to the Company's focus on its channel partner
marketing strategy, the Company's revenues in any period are highly dependent
upon the sales efforts and success of Sync's channel partners and other
resellers, which are not within the control of the Company.  There can be no
assurance that the Company's channel partners and other resellers will give a
high priority to the marketing of the Company's products as compared to
competitive products or alternative networking solutions or that Sync's channel
partners and other resellers will continue to offer the Company's products.  A
significant portion of the Company's expenses are relatively fixed in advance,
based in large part on the Company's forecasts of future sales.  If sales are
below expectations in any given period, the adverse effect of a shortfall in
sales on the Company's operating results may be magnified by the Company's
inability to adjust spending to compensate for such shortfall.  The Company has
in the past and may in the future reduce prices or increase spending in response
to competition or to pursue new product or market opportunities.  Accordingly,
there can be no assurance that the Company will be able to attain or sustain
profitability on a quarterly or an annual basis.  In addition, it is possible
that in some future quarter the Company's operating results may be below the


                                      -13-
<PAGE>


expectations of public market analysts and investors.  In such event, the price
of the Company's Common Stock would likely be materially and adversely affected.

     DEPENDENCE ON THE IBM CUSTOMER BASE

     The Company's products are targeted at the large installed base of IBM
customers utilizing SNA networks.  These customers are likely to follow
recommendations from IBM with respect to products or services to support their
SNA networks.  In 1994, IBM announced support for Frame Relay, and IBM's current
SNA and WAN products incorporate a Frame Relay interface, and a wide array of
Frame Relay switching and termination functions.  In August 1995, the Company
entered into a cooperative marketing agreement with IBM.  In March 1996, Sync
and IBM announced a new strategic relationship in which IBM will make available
Sync's FrameNode product family under the IBM logo.  There can be no assurance
that IBM will continue to support Frame Relay, that IBM will not develop SNA-
over-Frame Relay products competitive with the Company's products, that either
the cooperative marketing arrangement or the new strategic relationship between
the Company and IBM will be successful, that IBM will not terminate the
cooperative marketing agreement or the new strategic relationship or that IBM
will not endorse the products of competitors or networking solutions not offered
by the Company.  Any of these events could have a material adverse effect on the
Company's business, operating results and financial condition.

     UNCERTAIN MARKET ACCEPTANCE OF FRAME RELAY FOR MISSION-CRITICAL
     APPLICATIONS

     The growth in the Company's net revenues in the first nine months of 1996
relative to the first nine months of 1995 was due in part to growth in sales of
Sync's Frame Relay Access products, which enable SNA and client/server
internetworking over Frame Relay.  The market for SNA-over-Frame Relay products
is relatively new and still evolving.  The success of the Company and its
channel partners in generating significant sales of Frame Relay Access  products
will depend in part on their ability to educate end users about the benefits of
the Company's technology and convince end users to switch their mission-critical
applications to Frame Relay.  In addition, broad acceptance of Frame Relay
services will also depend upon the tariffs for such services, which are
determined by carriers.  If the tariff structure for dedicated leased lines
becomes more favorable relative to tariffs for a comparable network utilizing
Frame Relay, the market for Frame Relay networking products, such as Frame Relay
Access, could be adversely affected.  There can be no assurance that the market
will adopt Frame Relay for mission-critical applications to any significant
extent.  The failure of such adoption to occur could have a material adverse
effect on the Company's business, operating results and financial condition.

     UNCERTAIN MARKET ACCEPTANCE OF THE COMPANY'S PRODUCTS; PRODUCT
     CONCENTRATION

     The Company currently derives substantially all of its revenues from its
frame relay access, circuit management, transmission and other products and
expects that revenues from these products will continue to account for
substantially all of its revenues for the foreseeable future.  Broad market
acceptance of and continuing demand for these products is, therefore, critical
to the Company's future success. Factors that may affect the market acceptance
of the Company's products include the extent to which Frame Relay is adopted for
mission-critical applications, the availability and price of competing products
and technologies, announcements by IBM relating to products, services or pricing
relevant to the Company, the success of the sales efforts of the Company and its
resellers and tariff rates for carrier services.  Moreover, the Company's
operating history in the WAN internetworking market and its resources are
limited relative to those of certain of its current and potential competitors.
The Company's future performance will also depend in part on the successful
development, introduction and market


                                      -14-
<PAGE>


acceptance of new and enhanced products.  Failure of the Company's products to
achieve market acceptance could have a material adverse effect on the Company's
business, operating results and financial condition.

     DEPENDENCE ON CHANNEL PARTNERS AND OTHER RESELLERS

     The Company is pursuing a channel partner sales and marketing strategy
focused on establishing marketing partnerships with selected communications and
networking companies, as well as carriers.  The Company currently maintains
marketing and sales arrangements with selected, leading communications and
networking companies such as 3Com and NET and, most recently, IBM, as well as
carriers such as Sprint Corp., GTE Corp., CompuServe, Inc., Ameritech and MCI
Communications.  The Company relies on its network of channel partners and other
resellers for a substantial majority of its revenues, including virtually all of
its sales outside of the United States.  The Company's agreements with its
channel partners and other resellers do not restrict the sale of products that
compete with those of the Company.  In addition, these agreements generally
provide for discounts based on expected or actual volumes of products purchased
or resold by the reseller in a given period, do not require minimum purchases,
prohibit distribution of certain products by the Company through certain
categories of third parties under certain conditions and provide manufacturing
rights and access to source code upon the occurrence of specified conditions or
defaults.  The Company expects that certain of its channel partners may in the
future develop competitive products, and, if they do so, they may decide to
terminate their relationships with the Company.  In addition, many of the
Company's resellers offer competitive products manufactured either by third
parties or by themselves.  Furthermore, certain of the Company's channel
partners offer alternative solutions, designed by themselves or third parties,
for SNA internetworking or have pre-existing relationships with current or
potential competitors of the Company.  There can be no assurance that the
Company's channel partners and other resellers will give a high priority to the
marketing of the Company's products as compared to competitive products or
alternative networking solutions or that Sync's channel partners and other
resellers will continue to offer the Company's products.  Any reduction or delay
in sales of the Company's products by its channel partners could have a material
adverse effect on the Company's business, operating results and financial
condition.

     The Company's channel partners and other resellers account, and are
expected to continue to account, for a substantial majority of the Company's net
revenues.  Sales through channel partners and other resellers accounted for
84.9%, 72.8% and 64.8% of net revenues of the Company, excluding TyLink, in
1995, 1994 and 1993 fiscal years, respectively.  Sales to 3Com accounted for
27.0% and 12.8% of net revenues of the Company, excluding TyLink, in 1995 and
1994 fiscal years, respectively.  The Company believes the relative amount of
revenues derived from sales to 3Com will likely decline as competitive products
impact the conversion product business.  During 1995, sales to Cabletron
accounted for 16.8% of net revenues of the Company, excluding TyLink, but sales
to Cabletron have declined substantially in 1996, and sales to Cabletron are not
expected to increase in the future.  Each of the Company's channel partners or
other resellers can cease marketing the Company's products at the reseller's
option, under certain conditions, with limited notice and with little or no
penalty.  There can be no assurance that the Company will retain its current
channel partners or other resellers or that it will be able to recruit
additional or replacement channel partners.  The loss of one or more of the
Company's channel partners or other resellers could have a material adverse
effect on the Company's business, operating results and financial condition.
The Company generally realizes a higher gross margin on direct sales than on
sales through its channel partners and other resellers.  Accordingly, as channel
partners and other resellers continue to account for a substantial majority of
the Company's net revenues, gross profit as a percentage of net revenues may
decline.


                                      -15-
<PAGE>


     RAPID TECHNOLOGICAL CHANGE AND NEW PRODUCTS

     The market for the Company's products is characterized by rapidly changing
technology, evolving industry standards and frequent new product introductions.
The Company's success will depend to a substantial degree upon its ability to
develop and introduce in a timely fashion enhancements to its existing products
and new products that meet changing customer requirements and emerging industry
standards.  For example, the Company believes that the timely development of end
user and carrier based products supporting next generation networking standards,
such as asynchronous transfer mode ("ATM"), which many industry experts expect
to be the next generation networking standard, may be critical to the Company's
future success.  The development of new, technologically advanced products is a
complex and uncertain process requiring high levels of innovation, as well as
the accurate anticipation of technological and market trends.  There can be no
assurance that the Company will be able to identify, develop, manufacture,
market or support new products successfully, that such new products will gain
market acceptance or that the Company will be able to respond effectively to
technological changes, emerging industry standards or product announcements by
competitors.  In addition, the Company has on occasion experienced delays in the
introduction of product enhancements and new products.  There can be no
assurance that in the future the Company will be able to introduce product
enhancements or new products on a timely basis.  Furthermore, from time to time,
the Company may announce new products, capabilities or technologies that have
the potential to replace or shorten the life cycle of the Company's existing
product offerings.  There can be no assurance that announcements of product
enhancements or new product offerings will not cause customers to defer
purchasing existing Company products or cause resellers to return products to
the Company.  Failure to introduce new products or product enhancements
effectively and on a timely basis, customer delays in purchasing products in
anticipation of new product introductions and any inability of the Company to
respond effectively to technological changes, emerging industry standards or
product announcements by competitors could have a material adverse effect on the
Company's business, operating results and financial condition.

     PRODUCT ERRORS

     Products as complex as those offered by the Company may contain undetected
software or hardware errors when first introduced or as new versions are
released.  Such errors have occurred in the past, and there can be no assurance
that, despite testing by the Company and by current and potential customers,
errors will not be found in new or enhanced products after commencement of
commercial shipments.  Moreover, there can be no assurance that once detected,
such errors can be corrected in a timely manner, if at all.  Software errors may
take several months to correct, if they can be corrected at all, and hardware
errors may take even longer to rectify.  The occurrence of such software or
hardware errors, as well as any delay in correcting them, could result in the
delay or loss of market acceptance of the Company's products, additional
warranty expense, diversion of engineering and other resources from the
Company's product development efforts or the loss of credibility with Sync's
channel partners and other resellers, any of which could have a material adverse
effect on the Company's business, operating results and financial condition.


                                      -16-
<PAGE>


     INTENSE COMPETITION

     The market for communications products is intensely competitive and subject
to rapid technological change and emerging industry standards.  The Company's
current competitors include LAN networking companies such as Cisco Systems, Inc.
("Cisco"), Hypercom Inc. ("Hypercom") and Motorola Information Systems Group,
Netlink, Inc. ("Netlink"), an internetworking company that Cabletron recently
announced the acquisition of, carriers and other providers of telecommunications
equipment and services.  Potential competitors include other LAN networking
companies, Frame Relay switching companies, IBM and the Company's other channel
partners.  Certain of these companies, including Cisco, Hypercom, Netlink and
Bay Networks, Inc., have announced their intention to target the SNA-over-Frame
Relay market, and Cisco has recently introduced new products for this market.
Many of the Company's current and potential competitors have longer operating
histories and greater financial, technical, sales, marketing and other
resources, as well as greater name recognition and a larger customer base, than
the Company.  As a result, they may be able to respond more quickly to new or
emerging technologies and changes in customer requirements or will be able to
devote greater resources to the development, promotion, sale and support of
their products than the Company.  Many also have long-standing customer
relationships with large enterprises that are part of the Company's target
market, and these relationships may make it more difficult to complete sales of
the Company's products to these enterprises.  Furthermore, the Company expects
that certain of its channel partners will in the future develop competitive
products and may then decide to terminate their relationships with the Company.
Consequently, the Company expects to encounter increased competition,
particularly in the Frame Relay market.  Increased competition could result in
significant price competition, reduced profit margins or loss of market share,
any of which could have a material adverse effect on the Company's business,
operating results and financial condition.  There can be no assurance that the
Company will be able to compete successfully in the future.

     INTEGRATION OF TYLINK

     There can be no assurance that the operations and personnel of TyLink will
be successfully assimilated into the Company's business.  The risks associated
with the Merger include the potential disruption of the respective ongoing
businesses of TyLink and the Company, the inability of the Company's management
to maximize the financial and strategic position of the combined entity through
successful incorporation of TyLink's personnel and clients, the inability to
implement uniform standards, controls, procedures and policies and the
impairment of relationships with existing employees and clients as a result of
the Company's integration of new management personnel.  In addition, the
combined entity incurred significant expenses as a result of the negotiation and
implementation of the merger.  These factors could have a material adverse
effect on the Company's business, financial condition and operating results.

     DEPENDENCE ON CONTRACT MANUFACTURERS

     The Company's manufacturing operations consist primarily of materials
planning and procurement, light assembly, system integration, testing and
quality assurance.  The Company subcontracts most component kitting and printed
circuit board assembly to companies that specialize in those services.  In
addition, the Company has an arrangement with a contract manufacturer pursuant
to which the Company intends to outsource substantial portions of its
procurement, assembly and system integration operations.  The Company expects to
enter into similar arrangements with other contract manufacturers.  There can be
no assurance that these independent contract manufacturers will be able to


                                      -17-
<PAGE>


meet the Company's future requirements for manufactured products or that such
independent contract manufacturers will not experience quality problems in
manufacturing the Company's products.  The inability of the Company's contract
manufacturers to provide the Company with adequate supplies of high quality
products could have a material adverse effect upon the Company's business,
operating results and financial condition.  The loss of any of the Company's
contract manufacturers could cause a delay in Sync's ability to fulfill orders
while the Company identifies a replacement manufacturer.  Such an event could
have a material adverse effect on the Company's business, operating results and
financial condition.

     The Company's manufacturing procedures are designed to assure rapid
response to customer orders, but may in certain instances create a risk of
excess or inadequate inventory if orders do not match forecasts.  The Company
increased manufacturing capacity in 1995 and 1996 through the expansion of its
relationships with contract manufacturers and internal manufacturing resources.
Any manufacturing delays, inability to increase manufacturing capacity as
required or failure to forecast accurately inventory requirements could have a
material adverse effect on the Company's business, operating results and
financial condition.

     DEPENDENCE ON SUPPLIERS

     Certain key components used in the manufacture of the Company's products
are currently purchased only from single or limited sources.  At present,
single-sourced components include programmable integrated circuits, other
selected integrated circuits and cables, custom-molded plastics and custom-
tooled sheet metal and limited-sourced components, including flash memories,
dynamic random access memories ("DRAMs"), printed circuit boards and selected
integrated circuits.  The Company generally does not have long-term agreements
with any of these single or limited sources of supply.  Any interruption in the
supply of any of these components, or the inability of the Company to procure
these components from alternate sources at acceptable prices and within a
reasonable time, could have a material adverse effect upon the Company's
business, operating results and financial condition.  The Company uses a rolling
six-month forecast based on anticipated orders to determine its general
materials and manufacturing staffing requirements.  Lead times for materials and
components ordered by the Company vary significantly and depend on factors such
as the specific supplier, contract terms and demand for a component at a given
time.  If orders do not match forecasts, the Company may have excess or
inadequate inventory of certain materials and components.  From time to time the
Company has experienced shortages of certain components and has paid above-
market prices to acquire such components on an accelerated basis or has
experienced delays in fulfilling orders while waiting to obtain the necessary
components.  Such shortages may occur in the future and could have a material
adverse effect on the Company's business, operating results and financial
condition.

     DEPENDENCE ON AND RISKS ASSOCIATED WITH INTERNATIONAL SALES

     Sales to customers outside of the United States accounted for approximately
6.5%,  8.6%, 11.6% and 14.4% of the Company's net revenues, excluding TyLink, in
the nine months ended September 30, 1996 and in 1995, 1994 and 1993,
respectively.  However, these percentages may understate sales of the Company's
products to international end users because certain of the Company's U.S.-based
channel partners market the Company's products abroad.  Historically, the
Company's international sales have been conducted primarily through independent
country-specific distributors.  The Company intends to market its products in
foreign countries in the future increasingly through its channel partners.
Failure of these resellers to market the Company's products internationally or
the loss of any of these resellers could have a material adverse effect on the
Company's business, operating results and financial


                                      -18-
<PAGE>


condition.  In addition, the Company's ability to increase sales of its products
to international end users may be limited if the carrier services, such as Frame
Relay, or protocols supported by the Company's products are not widely adopted
internationally.  A number of additional risks are inherent in international
transactions.  The Company's international sales currently are U.S. dollar-
denominated.  As a result, an increase in the value of the U.S. dollar relative
to foreign currencies could make the Company's products less competitive in
international markets.  International sales may also be limited or disrupted by
the imposition of governmental controls, export license requirements,
restrictions on the export of critical technology, currency exchange
fluctuations, political instability, trade restrictions and changes in tariffs.
In addition, sales in Europe and certain other parts of the world typically are
adversely affected in the third quarter of each year as many customers and end
users reduce their business activities during the summer months.  These
international factors could have a material adverse effect on future sales of
the Company's products to international end users and, consequently, the
Company's business, operating results and financial condition.

     DEPENDENCE ON PROPRIETARY TECHNOLOGY

     The Company's future success depends, in part, upon its proprietary
technology.  The Company does not hold any patents and currently relies on a
combination of contractual rights, trade secrets and copyright laws to establish
and protect its proprietary rights in its products.  There can be no assurance
that the steps taken by the Company to protect its intellectual property will be
adequate to prevent misappropriation of its technology or that the Company's
competitors will not independently develop technologies that are substantially
equivalent or superior to the Company's technology.  In the event that
protective measures are not successful, the Company's business, operating
results and financial condition could be materially and adversely affected.  In
addition, the laws of some foreign countries do not protect the Company's
proprietary rights to the same extent as do the laws of the United States.  The
Company is also subject to the risk of adverse claims and litigation alleging
infringement of intellectual property rights of others.  There can be no
assurance that third parties will not assert infringement claims in the future
with respect to the Company's current or future products or that any such claims
will not require the Company to enter into license arrangements or result in
litigation, regardless of the merits of such claims.  No assurance can be given
that any necessary licenses will be available or that, if available, such
licenses can be obtained on commercially reasonable terms.  Should litigation
with respect to any such claims commence, such litigation could be extremely
expensive and time-consuming and could have a material adverse effect on the
Company's business, operating results and financial condition regardless of the
outcome of such litigation.

     TARIFF AND REGULATORY MATTERS

     Rates for public telecommunications services, including features and
capacity of such services, are governed by tariffs determined by carriers and
subject to regulatory approval.  Future changes in these tariffs could have a
material effect on the Company's business.  For example, should tariffs for
Frame Relay services increase in the future relative to tariffs for dedicated
leased lines, the cost-effectiveness of the Company's products could be reduced,
which could have a material adverse effect on the Company's business, operating
results and financial condition.  In addition, the Company's products must meet
industry standards and receive certification for connection to certain public
telecommunications networks prior to their sale.  In the United States, the
Company's products must comply with various regulations defined by the Federal
Communications Commission and Underwriters Laboratories.  Internationally, the
Company's products must comply with standards established by telecommunications
authorities in various countries as well as with recommendations of the
Consultative Committee on International Telegraph and Telephony.  In addition,
carriers require


                                      -19-
<PAGE>


that equipment connected to their networks comply with their own standards,
which in part reflect their currently installed equipment.  Some public carriers
have installed equipment that does not fully comply with current industry
standards, and this noncompliance must be addressed in the design of the
Company's products.  Any future inability to obtain on a timely basis or retain
domestic or foreign regulatory approvals or certifications or to comply with
existing or evolving industry standards could have a material adverse effect on
the Company's business, operating results and financial condition.

     MANAGEMENT OF EXPANDING OPERATIONS

     The Company has recently experienced rapid growth and expansion (as well 
as the merger with TyLink), which has placed, and will continue to place, a 
significant strain on its administrative, operational and financial resources 
and increased demands on its systems and controls.  This growth has resulted 
in a continuing increase in the level of responsibility for existing 
management personnel and the hiring of significant new management personnel.  
For example, three of the Company's eight current executive officers joined 
the Company in 1995 and four in 1996:  Roger Dorf, President and Chief 
Operating Officer; Otto Berlin, Vice President of International Sales; Robert 
Degan, Executive Vice President of Operations and Product Fulfillment (former 
CEO of TyLink); Dominic Genovese, Vice President of Sales; Karen Ratta, Vice 
President of Manufacturing; Nicholas Redding, Vice President of Engineering; 
and Ronald J. Scioscia, Vice President of Finance and Administration and 
Chief Financial Officer.  The Company anticipates that any continued growth 
will require it to recruit and hire a substantial number of new employees, 
particularly development engineers.  There can be no assurance that the 
Company will be successful in hiring, integrating or retaining such 
personnel.  The Company's ability to manage its growth successfully will 
require the Company to continue to expand and improve its operational, 
management and financial systems and controls.  Any inability of the Company 
to manage growth effectively, hire and integrate necessary personnel or 
increase manufacturing capacity as required could have a material adverse 
effect on the Company's business, results of operations and financial 
condition.

     DEPENDENCE ON KEY PERSONNEL

     The Company's success depends, to a significant degree, upon the 
continued contributions of its key management, sales, marketing, research and 
development and manufacturing personnel, many of whom would be difficult to 
replace.  The Company maintains a key person life insurance policy only on 
John H. Rademaker, the Company's Chief Executive Officer.  The Company 
believes its future success will also depend in large part upon its ability 
to attract and retain highly skilled engineering, managerial, sales and 
marketing personnel, particularly development engineers.  Competition for 
such personnel is intense, and there can be no assurance that the Company 
will be successful in attracting and retaining such personnel.  The loss of 
the services of any of the Company's key personnel, the inability to attract 
or retain qualified personnel in the future or delays in hiring required 
development engineers could have a material adverse effect on the Company's 
business, operating results or financial condition.

     GENERAL ECONOMIC CONDITIONS

     Demand for the Company's products depends in large part on the overall
demand for communications and networking products, which has in the past and may
in the future fluctuate significantly based on numerous factors, including
capital spending levels and general economic conditions.  There can be no
assurance that the Company will not experience a decline in demand for


                                      -20-
<PAGE>


its products due to general economic conditions.  Any such decline could have a
material adverse effect on the Company's business, operating results and
financial condition.

     VOLATILITY OF STOCK PRICE

     Factors such as announcements of technological innovations or the
introduction of new products by the Company or its competitors, as well as
market conditions in the technology sector, may have a significant effect on the
market price of the Company's Common Stock.  Furthermore, the stock market has
experienced volatility which has particularly affected the market prices of
equity securities of many high technology companies and which often has been
unrelated to the operating performance of such companies.  These market
fluctuations may have an adverse effect on the price of the Company's Common
Stock.

     ANTI-TAKEOVER PROVISIONS

     The Company is subject to the provisions of Section 203 of the Delaware
General Corporation Law, an anti-takeover law.  In addition, certain provisions
of the Company's charter documents, including provisions eliminating cumulative
voting, eliminating the ability of stockholders to take actions by written
consent and limiting the ability of stockholders to raise matters at a meeting
of stockholders without giving advance notice, may have the effect of delaying
or preventing a change in control or management of the Company, which could have
an adverse effect on the market price of the Company's Common Stock.  Certain of
the Company's stock option and purchase plans provide for assumption of such
plans, or, alternatively, immediate vesting upon a change of control or similar
event.  In addition, the Company has entered into severance agreements with its
officers, pursuant to which they are entitled to specified severance payments if
they are actually or constructively terminated within specified time periods
following a change of control of the Company.  The Board of Directors has
authority to issue up to 2,000,000 shares of Preferred Stock and to fix the
rights, preferences, privileges and restrictions, including voting rights, of
these shares without any further vote or action by the stockholders.  The rights
of the holders of the Common Stock will be subject to, and may be adversely
affected by, the rights of the holders of any Preferred Stock that may be issued
in the future.  The issuance of Preferred Stock, while providing desirable
flexibility in connection with possible acquisitions and other corporate
purposes, could have the effect of making it more difficult for a third party to
acquire a majority of the outstanding voting stock of the Company, thereby
delaying, deferring or preventing a change in control of the Company.
Furthermore, such Preferred Stock may have other rights, including economic
rights senior to the Common Stock, and as a result, the issuance of such
Preferred Stock could have a material adverse effect on the market value of the
Common Stock.  The Company has no present plan to issue shares of Preferred
Stock.


                                      -21-
<PAGE>

SYNC RESEARCH, INC.

     PART II.   OTHER INFORMATION


ITEM 1.   LEGAL PROCEEDINGS

          None.

ITEM 2.   CHANGES IN SECURITIES

          None.

ITEM 3.   DEFAULTS UPON SENIOR SECURITIES

          None.

ITEM 4.   SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

          None.

ITEM 5.   OTHER INFORMATION

          None.

ITEM 6.   EXHIBITS AND REPORTS ON FORM 8-K

          (a)  EXHIBITS

               10.3      Amended 1995 Employee Stock Purchase Plan.

               10.20*    Assumed TyLink Corporation 1994 Equity Incentive
                         Plan

               10.21     Employment Agreement between the Company and Robert
                         Degan, dated August 23, 1996.

               10.22     Employment Agreement between the Company and Richard
                         Swee, dated August 23, 1996.

               10.23     Form of Noncompetition Agreement between the Company 
                         and each of Robert Degan and Richard Swee, dated
                         August 23, 1996.


                                      -22-
<PAGE>


               10.24     Form of Severance Agreement between the Company and
                         each of John Rademaker and Roger Dorf, dated
                         September 30, 1996.

               10.25     Form of Severance Agreement between the Company and
                         other Company executive officers, dated September
                         30, 1996.

               10.26     Real Estate Lease between TyLink and Thomas J. Flatley,
                         d/b/a The Flatley Company, dated May 14, 1991.

               11.1      Computation of Earnings (Loss) per Share.

               27.1      Financial Data Schedule.

               *Incorporated by reference from Registrant's Registration
               Statement on Form S-8 (Registration No. 333-12315),
               filed with the Commission on September 19, 1996.

          (b)  REPORTS ON FORM 8-K

               A report on Form 8-K (with a report date of August 23, 1996) was
               filed on September 6, 1996, describing the acquisition of TyLink
               Corporation.  The item reported thereunder was Item 2
               (Acquisition or Disposition of Assets).  On November 8, 1996, an
               amendment to this Form 8-K was filed on Form 8-K/A.  The item
               reported thereunder was Item 7 (Financial Statements and
               Exhibits).  The audited financial statements of TyLink
               Corporation filed therewith contained balance sheets as of
               March  29, 1996 and March 31, 1995 and statements of operations
               and cash flows for the years ended March 29, 1996, March 31,
               1995 and April 1, 1994.  The unaudited pro forma combined,
               condensed financial statements for Sync and TyLink filed
               therewith contained statements of operations for the three years
               ended December 31, 1993, 1994 and 1995 and the six months ended
               June 30, 1996 and balance sheets as of December 31, 1995 and
               June 30, 1996.


                                      -23-
<PAGE>

SIGNATURES

     Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this Report to be signed on its behalf by the
undersigned, thereunto duly authorized.

                              SYNC RESEARCH, INC.



                              By:  /s/  Ronald J. Scioscia
                                   Ronald J. Scioscia
                                   Vice President of Finance and Administration
                                   and Chief Financial Officer
                                   (Duly Authorized Signatory and Principal
                                   Financial and Accounting Officer)



Date:     November 14, 1996


                                      -24-
<PAGE>

INDEX TO EXHIBITS

EXHIBIT
NUMBER                             DESCRIPTION
------

10.3      Amended 1995 Employee Stock Purchase Plan.

10.20*    Assumed TyLink Corporation 1994 Equity Incentive Plan

10.21     Employment Agreement between the Company and Robert Degan, dated
          August 23, 1996.

10.22     Employment Agreement between the Company and Richard Swee, dated
          August 23, 1996.

10.23     Form Noncompetition Agreement between the Company and each of 
          Robert Degan and Richard Swee, dated August 23, 1996.

10.24     Form of Severance Agreement between the Company and each of John
          Rademaker and Roger Dorf, dated September 30, 1996.

10.25     Form of Severance Agreement between the Company and other Company
          executive officers, dated September 30, 1996.

10.26     Real Estate Lease between TyLink and Thomas J. Flatley d/b/a The
          Flatley Company dated May 14, 1991.

11.1      Computation of Earnings (Loss) per Share.

27.1      Financial Data Schedule.

          *Incorporated by reference from Registrant's Registration Statement on
          Form S-8 (Registration Statement No. 333-12315), filed with the
          Commission on September 19, 1996

                                      -25-