<PAGE>   1

                       SECURITIES AND EXCHANGE COMMISSION
                              WASHINGTON, DC 20549


                                  FORM 10-Q/A

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


         FOR THE QUARTERLY PERIOD ENDED SEPTEMBER 30, 2000

                                       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: 000-28151

                                    PNV INC.
             (Exact name of registrant as specified in its charter)

                DELAWARE                                 65-0612435
     (State or other jurisdiction of        (I.R.S. employer identification no.)
     incorporation or organization)

         11711 N.W. 39TH STREET,
         CORAL SPRINGS, FLORIDA                            33065
(Address of principal executive offices)                 (Zip code)

                                 (954) 745-7800
              (Registrant's telephone number, including area code)

         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 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   [ ]


         The number of shares outstanding of the registrant's common stock, par
value $0.001 per share, as of November 3, 2000 was 15,997,356.



<PAGE>   2


                                    PNV INC.

                                   FORM 10-Q
                    FOR THE QUARTER ENDED SEPTEMBER 30, 2000

                               TABLE OF CONTENTS

<TABLE>
<CAPTION>
                                                                                                                     PAGE
                                                                                                                     ----

                                                  PART I - FINANCIAL INFORMATION

<S>              <C>                                                                                                 <C>
ITEM 1.          Financial Statements (Unaudited)..................................................................   3

                 Balance Sheets as of June 30, 2000 and September 30, 2000 (Unaudited).............................   3

                 Statements of Operations for the three months ended September 30, 1999 and 2000 (Unaudited).......   4

                 Statements of Cash Flows for the three months ended September 30, 1999 and 2000 (Unaudited).......   5

                 Notes to Condensed Financial Statements (Unaudited)...............................................   6

ITEM 2.          Management's Discussion and Analysis of Financial Condition and Results of Operations.............   8

ITEM 3.          Quantitative and Qualitative Disclosure About Market Risk.........................................  24

                                                  PART II - OTHER INFORMATION

ITEM 1.          Legal Proceedings.................................................................................  24

ITEM 2.          Changes in Securities and Use of Proceeds.........................................................  24

ITEM 3.          Defaults Upon Senior Securities...................................................................  25

ITEM 4.          Submission of Matters to a Vote of Security Holders...............................................  25

ITEM 5.          Other Information.................................................................................  25

ITEM 6.          Exhibits and Reports on Form 8-K..................................................................  26

</TABLE>



                                       2
<PAGE>   3


PART I - FINANCIAL INFORMATION

ITEM 1.  Financial Statements
                                    PNV INC.
                                 BALANCE SHEETS
                                  (UNAUDITED)

<TABLE>
<CAPTION>
                                                                                     JUNE 30, 2000      SEPTEMBER 30, 2000
                                                                                     -------------      ------------------
                                                          ASSETS
<S>                                                                                  <C>                  <C>
Current Assets:
 Cash and cash equivalents.................................................          $   3,114,067        $   1,096,295
 Short-term investments....................................................             33,551,941           21,997,041
 Accounts receivable, net of allowance for doubtful accounts
   of $194,534 and $234,534 at June 30, 2000 and September 30, 2000,
   respectively............................................................                571,472              855,154
 Inventory.................................................................                813,789              814,048
 Prepaid expenses and other................................................              1,574,979            1,590,332
                                                                                     -------------        -------------
   Total current assets....................................................             39,626,248           26,352,870
Property and equipment, net ...............................................             42,279,726           41,340,414
Deferred financing costs...................................................              3,375,213            3,276,474
Other assets...............................................................              3,162,378            3,101,286
                                                                                     -------------        -------------
   Total...................................................................          $  88,443,565        $  74,071,044
                                                                                     =============        =============

                                     LIABILITIES AND STOCKHOLDERS' (DEFICIENCY) EQUITY
Current Liabilities:
 Accounts payable..........................................................          $   2,521,014        $   2,092,057
 Accrued expenses..........................................................              4,208,344            4,865,152
 Accrued interest on senior notes..........................................              1,245,831            3,683,331
 Deferred revenue..........................................................              1,039,757              985,825
 Current portion of capital lease obligations..............................                410,077              393,007
                                                                                     -------------        -------------
   Total current liabilities...............................................              9,425,023           12,019,372
                                                                                     -------------        -------------
Obligations under capital leases, less current portion.....................                440,557              358,822
                                                                                     -------------        -------------
Long-term debt, less current portion ......................................             71,303,253           71,415,935
                                                                                     -------------        -------------
Commitments and Contingencies
Common Stockholders' (Deficiency) Equity:
 Common stock -- par value $.001 per share; 50,000,000 shares
   authorized, 15,997,356 shares issued and outstanding at June 30,
   2000 and September 30, 2000, respectively...............................                 15,997               15,997
 Additional paid-in capital................................................            139,491,870          139,491,870
 Deferred stock-based compensation and marketing related expenses..........             (2,779,410)          (1,537,829)
 Receivable from stockholders..............................................               (153,772)            (156,102)
 Accumulated deficit.......................................................           (129,299,953)        (147,537,021)
                                                                                     -------------        -------------
   Total common stockholders' (deficiency) equity..........................              7,274,732           (9,723,085)
                                                                                     -------------        -------------
   Total...................................................................          $  88,443,565        $  74,071,044
                                                                                     =============        =============
</TABLE>

                       See notes to financial statements.


                                       3
<PAGE>   4


                                    PNV INC.
                            STATEMENTS OF OPERATIONS
                                  (UNAUDITED)

<TABLE>
<CAPTION>
                                                                                            THREE MONTHS ENDED
                                                                                               SEPTEMBER 30,
                                                                                      --------------------------------
                                                                                          1999                2000
                                                                                      ------------        ------------
<S>                                                                                   <C>                 <C>
Net Revenues ..................................................................       $  3,380,691        $  5,537,875
Cost of Revenues:
    Service Cost ..............................................................          4,060,467           5,535,765
    Service Depreciation ......................................................          1,470,793           2,222,864
    Equipment cost ............................................................            426,658             494,161
    Advertising ...............................................................            369,215             552,531
                                                                                      ------------        ------------
      Total cost of revenues ..................................................          6,327,133           8,805,321
                                                                                      ------------        ------------
Gross margin ..................................................................         (2,946,442)         (3,267,446)
Selling, general and administrative expenses (exclusive of non-cash
    stock compensation expense shown below)                                              6,885,842          11,922,194
Stock compensation expense ....................................................          2,022,443           1,074,710
                                                                                      ------------        ------------
Loss from operations ..........................................................        (11,854,727)        (16,264,350)
Interest expense ..............................................................          2,652,054           2,458,485
Interest income and other .....................................................           (183,825)           (485,767)
                                                                                      ------------        ------------
    Net Loss ..................................................................        (14,322,956)        (18,237,068)
    Preferred stock dividends and amortization of preferred stock
      issuance costs ..........................................................           (813,642)                 --
    Accretion of preferred shares to fair value ...............................         (3,187,521)                 --
                                                                                      ------------        ------------
    Net loss attributable to common stockholders ..............................       $(18,324,169)       $(18,237,068)
                                                                                      ============        ============
Basic and diluted net loss per share ..........................................       $      (4.23)       $      (1.14)
                                                                                      ============        ============
Weighted average shares outstanding ...........................................          4,329,397          15,997,356
                                                                                      ============        ============
</TABLE>

                       See notes to financial statements


                                       4
<PAGE>   5


                                    PNV INC.
                            STATEMENTS OF CASH FLOWS
                                  (UNAUDITED)

<TABLE>
<CAPTION>
                                                                                             THREE MONTHS ENDED
                                                                                                SEPTEMBER 30,
                                                                                      --------------------------------
                                                                                          1999                2000
                                                                                      ------------        ------------
<S>                                                                                   <C>                 <C>
OPERATING ACTIVITIES:
Net loss .......................................................................      $(14,322,956)       $(18,237,068)
Adjustments to reconcile net loss to net cash used in operating activities:
 Depreciation and amortization .................................................         1,812,921           3,799,110
 Amortization of deferred stock based compensation .............................         2,022,443           1,074,710
 Provision for losses on accounts receivable ...................................                --              40,000
 Stock options issued for services .............................................            35,982                  --
 Changes in assets and liabilities: ............................................                --                  --
   Accounts receivable .........................................................          (280,696)           (323,682)
   Inventory ...................................................................            52,462                (259)
   Prepaid expenses and other ..................................................          (106,528)            (15,353)
   Other assets ................................................................          (269,249)           (925,197)
   Accounts payable ............................................................         1,169,166            (428,957)
   Accrued expenses ............................................................         1,250,303             656,808
   Accrued interest on senior notes ............................................         2,437,500           2,437,500
   Deferred revenue ............................................................            60,874             (53,932)
                                                                                      ------------        ------------
    Net cash used in operating activities ......................................        (6,137,778)        (11,976,320)
                                                                                      ------------        ------------
INVESTING ACTIVITIES:
 Purchases of short-term investments ...........................................       (20,068,663)           (445,100)
 Proceeds from sales of short-term investments .................................         5,006,529          12,000,000
 Purchases of restricted investments ...........................................           (65,560)                 --
 Purchases of property and equipment ...........................................        (3,789,983)         (1,489,086)
                                                                                      ------------        ------------
    Net cash (used in) provided by investing activities ........................       (18,917,677)         10,065,814
                                                                                      ------------        ------------
FINANCING ACTIVITIES:
 Proceeds from issuance of preferred stock .....................................        31,500,000                  --
 Payment of preferred stock issuance costs .....................................        (2,097,000)                 --
 Proceeds from exercise of warrants ............................................                24                  --
 Payment of obligations under capital leases ...................................          (127,381)           (107,266)
 Receivable from stockholder ...................................................            53,000                  --
 Notes payable .................................................................            (9,026)                 --
                                                                                      ------------        ------------
    Net cash provided by (used in) financing activities ........................        29,319,617            (107,266)
                                                                                      ------------        ------------
Net increase (decrease) in cash and cash equivalents ...........................         4,264,162          (2,017,772)
Cash and cash equivalents, beginning of period .................................         4,100,848           3,114,067
                                                                                      ------------        ------------
Cash and cash equivalents, end of period .......................................      $  8,365,010        $  1,096,295
                                                                                      ============        ============
Supplemental cash flow information:
 Interest paid .................................................................      $     16,603        $     20,985
                                                                                      ============        ============
Non-Cash financing and investing activities:
 Capital lease obligations relating to acquisition of property and equipment ...      $    139,391        $     15,000
                                                                                      ============        ============
 Issuance of common stock warrants .............................................      $    625,690        $         --
                                                                                      ============        ============
 Issuance of conversion features attached to Series D preferred stock ..........        13,372,685        $         --
                                                                                      ============        ============
</TABLE>
                       See notes to financial statements.


                                       5
<PAGE>   6
                                    PNV INC.
                    NOTES TO CONDENSED FINANCIAL STATEMENTS

1.       BASIS OF PRESENTATION

The interim balance sheet as of September 30, 2000, the interim statements of
operations for the three months ended September 30, 1999 and 2000 and the
interim statement of cash flows for the three months ended September 30, 1999
and 2000 are unaudited. In the opinion of management, all adjustments necessary
for a fair presentation of such financial statements have been included. All
adjustments made were of a normal recurring nature. Certain information and
footnote disclosure normally included in the annual financial statements
prepared in accordance with generally accepted accounting principles have been
condensed or omitted. PNV Inc. (the "Company") believes that the disclosures
included are adequate and provide a fair presentation of interim period results.
Interim financial statements are not necessarily indicative of financial
position or operating results to be expected for the entire year. These interim
financial statements should be read in conjunction with the audited financial
statements and notes thereto, contained in the Company's Annual Report on Form
10-K for the fiscal year end June 30, 2000.

2.       NATURE OF BUSINESS, GOING CONCERN AND MANAGEMENT PLANS

Nature of Business. PNV Inc. (formerly Park 'N View, Inc.), a Delaware
corporation, was incorporated on September 18, 1995 and provides bundled
telecommunications, cable television and internet access services over its
private integrated network to long-haul truck drivers at truckstops ("sites")
throughout the country. The Company also provides telecommunications and
internet access services to other participants in the trucking community. The
Company's name was changed effective November 1999. As of September 30, 2000,
the Company's private integrated network was deployed at 288 sites. In addition,
as of September 30, 2000, one or more of the telecommunications services that we
offer truckstop operators for the public areas inside the truckstop were
available at an additional 109 sites.

Going Concern. The accompanying financial statements have been prepared on a
going concern basis, which contemplates the realization of assets and the
satisfaction of liabilities in the normal course of business. The Company has
experienced net operating losses since inception and as of September 30, 2000
had an accumulated deficit of $147.5 million. The Company currently anticipates
that its available cash together with anticipated cash generated from operations
may not be sufficient to meet its capital needs beyond February 2001. Therefore,
to fund operations, the Company must obtain additional capital resources through
debt and/or equity financing, the disposition of assets or otherwise in the near
term. These conditions, among others, may indicate that the Company may be
unable to continue as a going concern for a reasonable period of time. The
financial statements do not include any adjustments relating to the
recoverability and classification of recorded asset amounts or the amounts and
classifications of liabilities that might be necessary should the Company be
unable to continue as a going concern. Management of the Company is taking
several actions in its attempts to alleviate this situation.

Management Plans. Management believes that the Company must significantly
increase users and subscribers of its services, increase revenue, reduce
overall expenses and obtain additional funding in order to reach breakeven and
achieve profitability. The Company's future success will depend on achieving
market acceptance in sufficient numbers and at commercially viable subscription
rates, the timely and cost-effective installation of the Company's system at
truckstops, effectively reducing operating expenses and obtaining the financing
necessary both to fund operating losses and to install its system in additional
locations.

The Company has recently completed work with a consulting firm to develop
operating strategies for increasing users and subscribers of its services and
increasing revenues; develop financial strategies for obtaining additional
funding and reducing expenses; develop a long-term business and capital
requirements plan; and determine the best utilization of its assets in an effort
to maximize the value of the Company. The long-term business plan will result in
changes to the Company's operations and business model, the timing and magnitude
of which are currently uncertain. The Company is endeavoring to implement new
operating strategies in an effort to increase revenues. In an initial effort to
reduce expenses, in October 2000, the Company cut its work force by
approximately 15%. The Company is focusing on further reducing its expenses in
an effort to improve its cost structure and achieve long-term profitability.

The Company has determined that it will not make the interest payment of $4.9
million due November 15, 2000 on its 13% Senior Notes due 2008. If the Company
fails to make this interest payment by December 15, 2000, the holders of these
notes can accelerate payment in full, which the Company would be unable to make.

The Company has recently retained an investment banking firm to act as its
investment advisor with respect to implementing financial strategies to improve
its long-term prospects and to explore all strategic alternatives in an effort
to maximize the value of the Company. Initially, with the assistance of its
investment advisor the Company will focus on its immediate need for additional
funds. There can be no assurance that the Company will be able to obtain
additional funding in amounts and on terms acceptable to it. If such funding is
not available or is not available on acceptable terms, the Company will be
unable to meet its operating obligations which would likely require that it
cease operations. The Company also intends, with the assistance of its
investment advisor, to initiate discussions with holders of its 13% Senior Notes
as soon as possible, in an attempt to restructure its indebtedness. The
indenture governing the 13% Senior Notes substantially restricts the Company's
ability to obtain additional debt financing and also places a number of
additional limitations on the Company's ability to implement certain of its
contemplated operational and financial strategies. The Company's failure to
comply with these limitations could result in the acceleration of the maturity
of these notes.

                                       6
<PAGE>   7


3.       PROPERTY AND EQUIPMENT

Property and equipment consist of the following:

<TABLE>
<CAPTION>
                                                                                         JUNE 30,         SEPTEMBER 30,
                                                                                           2000               2000
                                                                                       -------------      -------------
<S>                                                                                    <C>                <C>
Site equipment and improvements..............................................          $  48,254,049      $  49,815,135
Computer equipment...........................................................              2,505,245          2,630,721
Vehicles.....................................................................              2,054,042          2,047,448
Website development costs....................................................                341,350            341,350
Furniture, fixtures and other equipment......................................                556,706            645,431
                                                                                       -------------      -------------
 Subtotal....................................................................             53,711,392         55,480,085
Less accumulated depreciation................................................             14,698,353         17,091,633
                                                                                       -------------      -------------
 Subtotal....................................................................             39,013,039         38,388,452
Component equipment..........................................................              3,266,687          2,951,962
                                                                                       -------------      -------------
Property and equipment, net..................................................          $  42,279,726      $  41,340,414
                                                                                       =============      =============
</TABLE>

Component equipment represents equipment that is awaiting installation at a
site. Upon installation the cost of the related equipment is transferred to
site equipment and improvements and depreciation commences once the site is
operational. Component equipment is temporarily staged at the Company's
warehouse until all equipment for a site is received, certain assembly
operations are complete and the site is ready to accept the equipment for
installation. Component equipment is reclassified to site equipment upon
completion of the site on a FIFO basis for all components.

Costs incurred during the development stage of the Company's website are
capitalized in accordance with EITF No. 00-2 "Accounting for Website
Development Costs." Such costs are amortized over three years.

4.       NET LOSS PER SHARE

The following is a reconciliation of the numerators and denominators used in
computing basic and diluted net loss per share.

<TABLE>
<CAPTION>
                                                                                                 SEPTEMBER 30,
                                                                                   -----------------------------------
                                                                                       1999                  2000
                                                                                   -------------        --------------
<S>                                                                                <C>                  <C>
Net loss attributable to common stockholders (numerator), basic
    and diluted:......................................................             $ (18,324,169)       $  (18,237,068)
                                                                                   =============        ==============
Shares (denominator), weighted average common shares outstanding,
    basic and diluted ................................................                 4,329,397            15,997,356
                                                                                   =============        ==============
Net loss per share, basic and diluted ................................             $       (4.23)       $        (1.14)
                                                                                   =============        ==============
</TABLE>


5.       RECENTLY ISSUED ACCOUNTING PRONOUNCEMENTS

In December 1999, the Securities and Exchange Commission ("SEC") issued Staff
Accounting Bulletin ("SAB") No. 101 "Revenue Recognition" which provides
guidance on the recognition, presentation and disclosure of revenue in
financial statements filed with the SEC. SAB No. 101 is applicable beginning
with the Company's fourth quarter financial statements ending June 30, 2001.
Management has not determined what effect, if any, the adoption of SAB No. 101
will have on the Company's financial statements.

In June 1998, the Financial accounting Standards Board issued SFAS No. 133,
"Accounting for Derivative Instruments and Hedging Activities." SFAS No. 133
establishes accounting and reporting standards for derivative instruments,
including derivative instruments embedded in other contracts, and for hedging
activities. In June 1999, the FASB issued SFAS No. 137, "Accounting for
Derivative Instruments and Hedging Activities-Deferral of the Effective Date of
FASB Statement No. 133," which postponed the adoption of SFAS No. 133. In June
2000, FASB issued SFAS No. 138 which amended SFAS


                                       7
<PAGE>   8


No. 133 and provided additional guidance. The Company adopted SFAS No. 133, as
amended, in the first quarter of fiscal year 2001 with no significant effect to
the financial statements.

6.       COMMITMENTS AND CONTINGENCIES

In July 1999, Robert T. and Julie McCurry filed a lawsuit in Superior Court of
Shasta County, California against the Company and a truckstop chain at which the
network is deployed that seeks a total of $2.0 million in actual damages
resulting from an injury suffered by Mr. McCurry. The amount sought exceeds the
limit of the Company's insurance policy. The Company is unaware of any issues
which would result in the denial of insurance coverage. The court ordered
arbitration of the lawsuit. An arbitration award has been handed down against
the Company and the other defendants in the amount of $352,000. All defendants
in the lawsuit, including the Company, are appealing the arbitration award. The
Company currently anticipates that the lawsuit will likely be set for trial in
the first quarter of 2001.

The Company continues to receive claims arising from slip and fall incidents
relating to its network. The Company has advised its insurance carrier of these
incidents and the carrier has denied coverage or is reserving its rights to deny
coverage on several of these incidents due to the Company's alleged failure to
provide timely notice of such incidents. The Company's present understanding of
these claims is preliminary.

Due to the inherent uncertainty as to the outcome of this lawsuit or these
claims or whether such claims will be covered by insurance, the Company cannot
estimate the amount of loss, if any, that will result from the resolution of
these matters. The Company anticipates that it will be, from time to time,
subject to claims and suits for personal injury arising in the ordinary course
of its business. The Company anticipates that these claims and suits, to the
extent of actual damages, will generally be covered by insurance.

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

     Forward Looking Statements

The following discussion of our financial condition and results of operations
should be read in conjunction with our condensed financial statements and the
related notes thereto included elsewhere in this report. This document contains
forward-looking statements that involve risks and uncertainties, such as
statements of our plans, objectives, expectations and intentions. When used in
this document, the words "expects," "anticipates," "intends" and "plans" and
similar expressions are intended to identify certain of these forward-looking
statements. The cautionary statements made in this document should be read as
being applicable to all related forward-looking statements wherever they appear
in this document. Our actual results could differ materially from those
discussed in this document. Factors that could cause or contribute to such
differences include those discussed below, as well as those discussed in our
Form 10-K for the fiscal year ended June 30, 2000. We do not intend to update
any of the forward-looking statements after the date of this filing on Form 10-Q
to conform these statements to actual results.


     Need for Additional Capital

We currently anticipate that our available cash together with anticipated cash
generated from operations may not be sufficient to meet our capital needs beyond
February 2001. Therefore, to fund operations, we must obtain additional capital
resources through debt and/or equity financing, the disposition of assets or
otherwise in the near term. As of October 31, 2000, we had approximately $18.0
million in cash and cash equivalents and accrued expenses of approximately $5.0
million. There can be no assurance that we will be able to obtain additional
funds in amounts and on terms acceptable to us. If such funds are not available
or are not available on acceptable terms, we will be unable to meet operating
obligations which would likely require that we cease operations. If additional
funds are raised through the issuance of equity securities, our stockholders
will likely experience material dilution.

We have recently completed work with a consulting firm to:

         -        develop operating strategies for increasing users and
                  subscribers of our services and increasing revenues;

         -        develop financial strategies for obtaining additional funding
                  and reducing expenses;

         -        develop a long-term business and capital requirements plan;
                  and

         -        determine the best utilization of our assets in an effort to
                  maximize our value.

The long-term business plan will result in changes to our operations and
business model, the timing and magnitude of which are currently uncertain.

We are endeavoring to implement new operating strategies in an effort to
increase revenues. In an initial effort to reduce expenses, in October 2000, we
cut our work force by 15%. We are focusing on further reducing our expenses in
an effort to improve our cost structure and achieve long-term profitability.

We have determined that we will not make the interest payment of $4.9 million
due November 15, 2000 on our 13% Senior Notes due 2008. If we fail to make this
interest payment by December 15, 2000, the holders of these notes can accelerate
payment in full, which we would be unable to make. The indenture governing our
13% notes substantially restricts our ability to obtain additional debt
financing and also places a number of additional limitations on our ability to


                                       8
<PAGE>   9

implement certain of our contemplated operational and financial strategies. Our
failure to comply with these limitations could result in the acceleration of the
maturity of these notes.

We have recently retained an investment banking firm to act as our investment
advisor with respect to implementing financial strategies to improve our
long-term prospects and to explore all our strategic alternatives in an effort
to maximize our value. Initially, we will focus on our immediate need for
additional funds. We also intend, with the assistance of our investment advisor,
to initiate discussions with the holders of our 13% notes, as soon as possible,
in an attempt to restructure our indebtedness.

     Background

From November 1993 to November 1995, our predecessor, Park `N View, Ltd.
developed our private integrated network and installed and operated it at one
truckstop as a field test. There were no revenues or significant selling
expenses generated by Park `N View, Ltd. during this period. Following the
formation of PNV in September 1995, and the transfer to PNV of the business and
net liabilities of Park 'N View, Ltd., we began the buildout of our private
integrated network utilizing principally proceeds from sales of our securities
and began offering services on our private integrated network in December 1995
with the completion of our first site. As of September 30, 2000 our private
integrated network was deployed at 294 truckstops and fleet terminals. In
addition, as of September 30, 2000 one or more of the telecommunications
services that we offer truckstop operators for the public areas inside the
truckstop were available at an additional 109 truckstops. As of September 30,
2000 we also had deployed 97 prepaid phone card machines and 226 public Internet
kiosks. In an effort to conserve our available cash, we have determined to
significantly slow the deployment of our network and, in the three months ended
September 30, 2000, deployed our network at six additional sites. Since
inception, we have incurred significant losses and negative cash flow, and as of
September 30, 2000, we had an accumulated deficit of $147.5 million.

We issued warrants to PACCAR Inc. on November 18, 1999, the value of which we
recognize as selling, general and administrative expenses. Under these warrants,
if PACCAR does not purchase $1.0 million of our advertising services in each of
two years following the date we issued the warrants, the warrants will
terminate. As of October 31, 2000, PACCAR had purchased $0.9 million of
advertising services from us. The unvested portion of the warrants will be
remeasured each quarter and if different from the fair value in determining the
deferred marketing expense that we recorded in the prior quarter will be
reflected as an additional charge or credit to expense at that time.
Accordingly, the higher our stock price is at the time of remeasurement, the
more significant will be the deferred marketing expense that we will be required
to record and the portion of this amount to be recognized as selling, general
and administrative expenses. At the time the warrants vest, the fair value of
the vested portion will be remeasured for a final time and will not continue to
be remeasured in subsequent periods. The deferred marketing expense recorded for
the PACCAR warrants at September 30, 2000 was approximately $30,000, which we
intend to recognize over the term of the PACCAR commitment.

In March 2000, we signed an agreement with America Online, Inc., or AOL, under
which our content and services for the trucking and logistics industry will be
available across several AOL brands for the 26-month term of the agreement.
Under this agreement, we have paid AOL $4.0 million. Of the remaining $4.0
million owed to AOL, $1.0 is due in each December 2000, March 2001, June 2001
and September 2001. The entire $8.0 million amount will be amortized on a
straight line basis over the 26-month term of the agreement and will be
recognized as selling, general and administrative expenses. Our agreement with
AOL also provides us with the use of AOL's sales and marketing resources to
generate advertising revenue for our portal website. We have agreed to pay AOL a
commission on any such revenue.

In April 2000, we also issued to AOL a warrant to purchase 287,590 shares of
our common stock at an exercise price of $6.6875 per share. This warrant became
exercisable in full in May 2000. We intend to recognize the value of this
warrant as selling, general and administrative expenses. The value of this
warrant was determined using the Black-Scholes option pricing model to be
approximately $1.2 million. We have recorded this amount as deferred marketing
expense and are recognizing this expense on a straight-line basis over the
26-month term of our agreement with AOL.

In September 1999, we sold 3,000,000 shares of our Series D convertible
preferred stock for $10.50 per share. We determined that the purchase price was
below the deemed fair market value of the Series D preferred stock for
financial reporting purposes. As a result, we have recorded the deemed fair
market value of the Series D preferred stock as paid-in capital and the
difference between the purchase price and deemed fair market value as a
dividend.

In connection with the initial public offering of our common stock completed in
November 1999, our outstanding convertible preferred stock automatically
converted into common stock. As a result of this conversion, we recognized
unamortized preferred stock issuance costs of $3.7 million as additional paid
in capital.


                                       9
<PAGE>   10


We had approximately $112.0 million in net operating loss carryforwards at June
30, 2000 for income tax purposes. Utilization of the net operating loss
carryforwards may be subject to a substantial annual limitation due to the
"change in ownership" provisions of the Internal Revenue Code of 1986. The
annual limitation may result in the expiration of net operating losses before
utilization of the losses.

     Net Revenues

Our net revenues are currently generated from sales to truck drivers of monthly
subscriptions and daily memberships to the telecommunications, cable television
and Internet access services offered through our network, as well as
advertising sales, prepaid phone card operations, resale of long distance
telephone minutes and usage fees from our public Internet kiosks.

The following table sets forth the number of monthly and daily subscribers to
our network during the last month in each of our eight most recent fiscal
quarters.

<TABLE>
<CAPTION>

                                                          MONTHLY            DAILY              ISP                  TOTAL
PERIOD                                                  SUBSCRIBERS       SUBSCRIBERS     SUBSCRIBERS ONLY        SUBSCRIBERS
------                                                  -----------       -----------     ----------------        -----------
<S>                                                     <C>               <C>             <C>                     <C>
December 1998..................................           21,997             11,203               --                33,200
March 1999.....................................           21,632             14,136               --                35,768
June 1999......................................           21,317             13,829               --                35,146
September 1999.................................           24,803             10,456               --                35,259
December 1999..................................           27,317              7,688              729                35,734
March 2000.....................................           32,295              9,211            1,576                43,082
June 2000......................................           30,645              9,026            2,596                42,267
September 2000.................................           28,619             12,113            2,566                43,298
</TABLE>

We began to offer Internet access service on our network in July 1999. We
initially offered this service free of charge on a promotional basis. In
November 1999, we began to charge separate fees for monthly subscriptions and
daily memberships to this service. We launched our portal website in October
1999 and through this portal website we provide content for the trucking
community, including drivers and their families, industry suppliers and
manufacturers, truckstop operators and trucking fleets. During September 2000,
we had 6,150 monthly subscribers to our Internet access service, many of whom
were also subscribers to our telecommunications and cable television services.

Because a substantial number of our subscriptions have historically been sold
through vending machines and due to the deployment of our network over a
four-year period, our subscriptions have not followed the typical pattern
exhibited by a mature subscriber-based business with recurring and
automatically renewing subscriptions. In addition to monthly subscriptions
purchased at vending machines located at truckstops where our network is
deployed, our monthly subscribers consist of the following categories:

         -        Drivers whose subscription fees are automatically charged to
                  their credit cards or deducted from their checking accounts,
                  until cancelled, or directly billed in advance under a program
                  we refer to as the "power plan program;"

         -        Fleet drivers whose subscription fees are automatically
                  deducted from their compensation, until cancelled, under our
                  payroll deduction program in which their fleets participate.
                  As of September 30, 2000, 59 fleets were participating; and

         -        Fleet drivers whose subscription fees are paid by their
                  fleets. As of September 30, 2000, we have contracts with eight
                  fleets under which they have agreed to pay ongoing monthly
                  subscription fees for our services over varying periods of
                  time.



                                       10
<PAGE>   11

The following table sets forth our monthly subscribers by category during the
last month in each of our eight most recent quarters:

<TABLE>
<CAPTION>
                                                                                PAYROLL                               VENDING
PERIOD                                                    POWER PLAN            DEDUCTION      FLEET FUNDED           MACHINE
------                                                    ----------            ---------      ------------           -------
<S>                                                       <C>                   <C>            <C>                    <C>
December 1998....................................           13,606                 506            2,974               4,911
March 1999.......................................           13,594                 330            2,818               4,890
June 1999........................................           11,988               2,000            3,200               4,129
September 1999...................................           11,443               4,159            3,259               5,942
December 1999....................................           10,862               6,860            3,172               6,423
March 2000.......................................           12,951               6,812            4,166               8,366
June 2000........................................           11,109               6,848            3,053               9,635
September 2000...................................            9,429               7,551            2,943               8,696
</TABLE>

We have experienced a decrease in monthly subscribers since June 2000
principally in those under the power plan program. We attributed this
unanticipated decrease to a change in our field sales incentive plan that was
less focused on power plan subscribers acquisition. In September 2000, we
realigned incentives in an effort to increase subscriptions under the power plan
program.

Prior to the commencement of our power plan program in October 1997, all of our
monthly subscriptions were purchased at vending machines at truckstops at which
our network was deployed. Currently, all purchases of daily subscriptions are
limited to vending machines at these truckstops.

We recognize revenue in the period earned. Pre-paid revenues are recorded as
deferred revenue until earned. Monthly subscription fees are recorded as
revenue ratably over the subscription period.

During the fourth quarter of fiscal 1999, we also began to generate revenue
from our prepaid phone card operations in one major truckstop chain and sales
of advertising principally in Connect!. In July 1999, we began to offer
Internet access service on our network free of charge on a promotional basis.
In November 1999, we charged separate fees for monthly and daily subscriptions
to this service. We have contracted with two truckstop chains to provide one or
more of the following services: a total communications solution to truckstop
owners and operators consisting of public phone and prepaid phone card
operations as well as public Internet kiosks. In addition, since January 2000,
we have generated revenues from sales of advertising on our portal website.

     Cost of Revenues

Our fixed operating expenses currently consist principally of:

         -        amortization and depreciation of the capitalized costs of our
                  network, as well as our Internet kiosks, prepaid phone card
                  machines and increased switching capacity to accommodate our
                  public phone operations;

         -        cable programming, which we purchase on a per parking stall
                  basis;

         -        T-1 lines, local telephone lines and routers for our frame
                  relay, which are installed at each truckstop at which our
                  network is deployed;

         -        commissions paid to one truckstop chain under a contract we
                  entered into in the first quarter of fiscal 2000; and

         -        long distance telephone time under a contract with AT&T.

Our variable operating expenses consist principally of purchases of long
distance and other telephone services, repairs and maintenance of our network,
commissions paid to truckstop operators under our contracts with them for
services through our network, publication of our Connect! magazine, payments to
the provider of certain components of our prepaid phone card


                                       11
<PAGE>   12

operations, development of our portal, incentive payments to one truckstop chain
relating to subscription sales quotas and the starter kit equipment.

We intend to implement further cost-cutting measures to improve our cost
structure which will include fixed and variable expenses.

     Selling Expenses

We market our network to drivers through a direct sales force. In October 2000,
we reduced and restructured our sales force in an effort to conserve our
remaining cash. We currently maintain additional sales personnel at a number of
our largest truckstop locations. Our sales force also sells to fleet drivers
through a fleet sales program or to the fleet driver individual through this
truckstop. We also have a sales force that sells our advertising media. Selling
expenses have therefore consisted principally of salaries, benefits, travel and
marketing expenses. In addition, we have marketed subscriptions through
point-of-sale merchandising materials and, at larger sites, through field sales
representatives. In connection with our cost-cutting efforts, we are exploring
alternative methods of marketing our services. We do not intend to add to our
sales force in the short-term.

     General and Administrative Expenses

We significantly increased the size of our management team during fiscal year
2000 and the number of our employees increased to 353 as of September 30, 2000
from 250 as of September 30, 1999, which resulted in an increase in general and
administrative expenses. As part of our cost reduction efforts, in October 2000,
we have recently reduced our work force.

RESULTS OF OPERATIONS

     Three months ended September 30, 2000 compared to the three months ended
September 30, 1999

Net Revenues. Our net revenues increased 62% to $5.5 million for the three
months ended September 30, 2000 from $3.4 million for the three months ended
September 30, 1999. The increase in revenues for fiscal year 2000 was primarily
attributable to additional subscription revenues and revenues from prepaid phone
card operations. For the three months ended June 30, 2000, our net revenues were
$5.5 million.

Cost of Revenues. Cost of revenues, excluding service depreciation, increased
35% to $6.6 million for three months ended September 30, 2000 from $4.9 million
for the three months ended September 30, 1999. The increase in cost of revenues,
excluding service depreciation, for fiscal 2000 was principally due to costs
associated with the increases in the number of truckstops at which our network
was deployed and in sales volume, partially offset by $.3 million in credits
received from AT&T. For the three months ended June 30, 2000, cost of revenues
were $8.4 million and included expenses of redoing connection points which we
did in the third and fourth quarters of fiscal 2000. The number of truckstops
and fleet terminals at which our network is deployed increased 24% to 294 as of
September 30, 2000 from 237 sites as of September 30, 1999. We have recently
slowed significantly the buildout of our network to conserve our available cash.

Service costs (which includes commissions payable to truckstops, cable
programming, T-1 lines, local telephone lines, long distance minutes purchased
for resale, routing equipment leases, prepaid phone card operations and site
repairs) increased 34% to $5.5 million for three months ended September 30, 2000
from $4.1 million for the three months ended September 30, 1999. This increase
was principally due to increase in the number of truckstops at which our network
is deployed, long distance telephone minutes included with subscriptions and
long distance minutes included with prepaid phone cards.

Service depreciation increased $.7 million to $2.2 million for the three months
ended September 30, 2000 from $1.5 million for the three months ended September
30, 1999. These increases in service depreciation reflect the additional
buildout of our network.


                                       12
<PAGE>   13


Advertising expense is principally associated with advertising revenue generated
from Connect!, our monthly cable television guide and lifestyle magazine.
Advertising expense increased 50% to $0.6 million for the three months ended
September 30, 2000 from $0.4 million for the three months ended September 30,
1999.

Gross Margin. Gross margin was a negative $3.3 million for the three months
ended September 30, 2000 compared to a negative $2.9 million for the three
months ended September 30, 1999.

Selling Expense. Selling expense increased 72% to $5.5 million for the three
months ended September 30, 2000 from $3.2 million for the three months ended
September 30, 1999. The increase was primarily attributable to an increase in
marketing and salaries including per diem. Marketing expense increased 217% to
$2.5 million for the three months ended September 30, 2000 from $.8 million for
the three month period ended September 30, 1999. Salaries increased 85% to $2.4
million for the three months ended September 30, 2000 from $1.3 million in the
three months ended September 30, 1999. The increase in marketing and salary
expenses reflects additional costs associated with personnel to expand our sales
and marketing programs. Also categorized as marketing expense are the warrants
granted to AOL and the marketing fee required under our agreement with AOL which
was $1.1 million.

General and Administrative Expenses. General and administrative expenses
increased 75% to $6.5 million for the three months ended September 30, 2000 from
$3.7 million for the three months ended September 30, 1999. The increase was
primarily attributable to an increase in salaries and consulting expense as well
as depreciation expense related to our portal website and the growth of our
operations. Salaries and consulting expense increased 61% to $3.7 million for
the three months ended September 30, 2000 from $2.3 million for the three months
ended September 30, 1999. Salaries and consulting expense primarily increased
due to additional personnel related to the creation and maintenance of our
portal website and the development of additional service offerings and fees paid
to the consulting firm with which we recently completed work on a long-term
business and capital requirements plan and other strategies.

Stock-Based Compensation Expense. During fiscal year 2000 and fiscal year 1999,
we granted options to purchase our common stock to employees and consultants at
exercise prices below the deemed fair market value of our common stock on the
grant dates for financial reporting purposes. We recognized stock-based
compensation expense of $1.1 million for the three months ended September 30,
2000 and $2.0 million for the three months ended September 30, 1999. During the
three months ended September 30, 2000, we have not granted options at an
exercise price below fair market value of our common stock on the grant dates
for financial reporting purposes.

Interest Expense (Income) and Other-Net. Interest expense (income) and other-net
decreased to $2.0 million, for the three months ended September 30, 2000 from
$2.5 million of interest income and other-net for the three months ended
September 30, 1999. The changes in net interest expense compared to the three
months ended September 30, 1999 is primarily attributable to the change in the
three months ended September 30, 2000 interest income over those periods that
was earned on cash proceeds from various equity offerings.

Net Loss. Net loss increased 27% to $18.2 million for the three months ended
September 30 2000 from $14.3 million for the three months ended September 30,
1999. We expect to incur significant net losses and experience substantial
negative cash flows for the foreseeable future.

LIQUIDITY AND CAPITAL RESOURCES

We completed our initial public offering of our common stock in November 1999.
The net proceeds to us from this offering after deducting underwriting
discounts and commissions and other offering expenses were $57.5 million. Since
our incorporation in September 1995, and prior to our initial public offering,
we satisfied our cash requirements through the proceeds of sales of common
stock, sales of preferred stock, certain debt securities and 13% notes which we
sold together with warrants to purchase 505,375 shares of our common stock. To
date, we have raised $204.0 million in debt and equity capital. At September
30, 2000, we had $23.1 million in cash and cash equivalents and short-term
investments. This amount has been further reduced during the second fiscal
quarter of the year ending June 30, 2001 as we have continued to fund our
operating losses.

Net cash used in operating activities was $12.0 million and $6.1 million for
the three months ended September 30, 2000 and 1999, respectively. The $5.9
million increase in net cash used in operating activities for the three months
ended


                                       13
<PAGE>   14

September 30, 2000 compared to the three months ended September 30, 1999
primarily resulted from an increase in the net loss of $3.9 million to $18.2
million for the three months ended September 30, 2000 compared to a net loss of
$14.3 million for the three months ended September 30, 1999. For the three
months ended September 30, 2000, our net loss was partially offset by an
increase in non-cash expenditures for depreciation, amortization and stock
option compensation expense of $1.1 million to $4.9 million for the three
months ended September 30, 2000 from $3.8 million for the three months ended
September 30, 1999.

Net cash (used in) provided by investing activities was $10.0 million and
$(19.0) million for the three months ended September 30, 2000 and for the three
months ended September 30, 1999, respectively. The $29.0 million decrease in
net cash used in investing activities for the three months ended September 30,
2000 compared to the three months ended September 30, 1999 resulted from the
increase in net sale of short-term investments in the amount of $12.0 million
for the three months ended September 30, 2000 to fund operating expenses, as
well as a decrease in capital expenditures of $2.3 million to $1.5 million for
the three months ended September 30, 2000 from $3.8 million for the three
months ended September 30, 1999.

Net cash provided by (used in) financing activities was $(.10) million and
$29.3 million for the three months ended September 30, 2000 and 1999,
respectively. The $29.4 million decrease in net cash provided by financing
activities for the three months ended September 30, 2000 compared to the three
months ended September 30, 1999 resulted primarily from our Series D Preferred
Stock offering completed in September 1999.

For the three months ended September 30, 2000, our working capital decreased
$15.9 million. The decrease was primarily attributable to an decrease in cash
and short term investments of $13.6 million to fund operating expenses.

We currently estimate that our capital expenditures for fiscal year 2001 will
range between $2.0 million and $2.5 million, principally for the deployment of
our network and services at truckstops and equipment for internal use.

Our capital commitments consist primarily of requirements under our
co-marketing agreement with AOL, capital leases, commissions payable to one
truckstop chain, noncancelable leases of routers for our frame relay and
contracts for T-1 lines and for long distance and other telephone services. At
June 30, 2000, our minimum commitments under capital leases and noncancelable
operating leases with terms in excess of one year, including commitments under
the contracts relating to our purchase of T-1 lines and long distance services
and the routers for our frame relay, totaled $5.6 million, $5.2 million, $4.9
million and $3.4, for the four years ending June 30, 2001 through 2004,
respectively. These amounts do not include our obligations to AOL. We owe AOL
$4.0 million under our agreement with it, which is payable in installments of
$1.0 million each in each of December 2000, March 2001, June 2001 and September
2001. If we make these payments from our remaining cash, we will further reduce
the resources available for our operations.

Semiannual interest payments on our 13% notes are due in May and November of
each year. The 13% notes mature in May 2008. We made the first four interest
payments from funds in restricted investments in an escrow account established
in connection with and from the proceeds of our sale of these notes. No funds
remain in this escrow account. We have recently determined that we will not
make the interest payment of $4.9 million due November 15, 2000 in order to
conserve our remaining cash.

Our cash and short-term investments as of September 30, 2000 was approximately
$23.1 million available for working capital. As of October 31, 2000, we had
approximately $18.0 million in cash and short-term investments and accrued
expenses of approximately $5.0 million.

We currently anticipate that our available cash resources together with
anticipated cash generated by operations may not be sufficient to meet our cash
requirements beyond February 2001. Our financing requirements will depend on
numerous factors, including principally our ability to reduce our expenditures
as well as our ability to increase our revenues. With the assistance of a
consulting firm, management recently completed the development of strategies
for increasing users of our services, increasing revenues, obtaining additional
funding and reducing expenses along with the development of a long-term
comprehensive business and capital requirements plan and a study of the best
utilization of our assets. The long-term


                                       14
<PAGE>   15

business plan will result in changes to our operations and business model, the
timing and magnitude of which are currently uncertain.

The indenture governing our 13% notes substantially restricts our ability to
obtain additional debt financing and imposes additional restrictions on our
ability to implement some of our contemplated operational and financial
strategies. Furthermore, there can be no assurance that additional financing
will be available when needed or that, if available, such financing will
include terms favorable to our stockholders or us. If our efforts to meet our
funding requirements are not successful, not completed on a timely basis as the
business plan requires or falls short of our complete needs, we expect that we
may experience insufficient liquidity, which will likely require us to cease
our operations.

RISK FACTORS

     WE MAY NOT BE ABLE TO CONTINUE AS A GOING CONCERN.

We currently anticipate that our available cash resources will not be sufficient
to meet our capital needs beyond February 2001. We have experienced net losses
since inception and, as of September 30, 2000, had an accumulated deficit of
$147.5 million. As a result of these losses, working capital deficiencies, our
outstanding debt, our contractual commitments and other liquidity issues, there
is substantial doubt about our ability to continue as a going concern.

Our ability to continue as a going concern is dependent upon our ability to:

         -        conserve our available cash and reduce our expenses in an
                  effort to improve our cost structure;

         -        obtain additional financing in the near future; and

         -        increase our revenues.

We recently completed work with a consulting firm to develop operating and
financial strategies and a long-term business plan which will result in changes
to our operations and business model, the timing and magnitude of which are
currently uncertain. We cannot assure you that our business strategy will be
successful.

     IF WE DO NOT SECURE ADDITIONAL FINANCING TO FUND OUR BUSINESS WE WILL
     LIKELY BE UNABLE TO CONTINUE OUR OPERATIONS.

We have substantial near term demands on our available cash to fund operations.
Our existing cash resources are limited. Therefore, we seek additional debt
and/or equity financing or to otherwise raise capital, which may involve the
disposition of assets. Any debt financings could result in the imposition of
operational or financial restrictions and increased interest expense. Any equity
financings would likely result in substantial dilution to holders of our common
stock and the grant of significant control and other rights to any new
investors. Any disposition of assets could result in a decrease in revenues or
could otherwise adversely affect our results of operations or financial
condition. There can be no assurance that we will be able to obtain needed
capital in the near future on terms acceptable to us or at all.

     WE ARE NOT ABLE TO REPAY CERTAIN OBLIGATIONS.

In May 1998, we issued 75,000 units consisting of $75.0 million in aggregate
principal amount of 13% Senior Notes due 2008. Interest on these notes accrues
at the rate of 13% per annum and is payable semiannually in arrears on May 15
and November 15 of each year. We made our first four scheduled interest payments
from funds in an escrow account. No funds remain in this account. Due to our
limited cash, we have recently determined that we will not make the interest
payment of $4.9 million due November 15, 2000 on these notes. We will have a
30-day grace period following which the noteholders can declare the notes in
default and accelerate the maturity of these notes which we would be unable to
pay. With the assistance of the investment bank we have recently retained, we
intend to initiate discussions with these noteholders as soon as possible in an


                                       15
<PAGE>   16

attempt to restructure our indebtedness.

In March 2000, we signed a marketing agreement with America Online, Inc., or
AOL. Under this agreement, we have paid AOL $4.0 million and agreed to pay an
additional $4.0 million. Of the remaining $4.0 million owed to AOL, $1.0 million
is due in each of December 2000, March 2001, June 2001 and September 2001. If we
make these payments from our remaining cash, we will reduce the resources
available for our operations. If we fail to make any scheduled payment under
this agreement, AOL may terminate this contract which could harm our marketing
efforts and our business. This transaction with AOL was premised on the
assumption that the traffic we would obtain from this arrangement would permit
us to earn revenues in excess of the payments made to AOL. This assumption has
to date proved to be incorrect.

     WE HAVE NOT BEEN PROFITABLE AND EXPECT FUTURE LOSSES AND NEGATIVE CASH
     FLOW.

From November 1993 to November 1995, our predecessor, Park `N View, Ltd.,
developed our network and installed and operated it at one truckstop as a field
test. We began offering services on our network in December 1995 with the
completion of our first site. We deployed our network at 14 truckstops in 1996,
59 truckstops in 1997, 113 truckstops in 1998, 71 truckstops in 1999 and 31 for
the period from January 2000 to September 2000. Consequently, we have a limited
operating history upon which you may evaluate us and we face all of the risks
and uncertainties of early-stage companies. To date, we have not been
profitable. We may never be profitable or, if we become profitable, we may be
unable to sustain profitability. We have recognized limited revenues since our
inception and have incurred substantial costs to build and deploy our network,
offer our services and operate our business. We have incurred net losses of
$147.5 million from our inception through September 30, 2000. To date, our cash
flow from operations has been substantially insufficient to meet our cash
requirements.

     MANY OF OUR COSTS ARE FIXED ON BOTH A LONG-TERM AND SHORT-TERM BASIS AND
     WE MAY NOT BE ABLE TO REDUCE THEM IN A TIMELY MANNER; WE HAVE PLANNED TO
     REDUCE OUR COSTS WHICH MAY HARM OUR ABILITY TO INCREASE OUR REVENUES.

A high percentage of the costs of operating our network are fixed, including
our commitments under our contract with AT&T for T-1 lines and our equipment
leases with Cisco for routers. If our revenues do not increase, we may not be
able to reduce our costs in a timely manner to account for any shortfall in
revenues. In addition, many of our costs are based on our expectations of the
future demand for our services and are relatively fixed in the short-term. We
are endeavoring to reduce the costs of operating our business, including some
of our fixed costs. Any such reduction could harm our ability to increase
subscribers to our services and our revenues.

     OUR FAILURE TO INCREASE OUR REVENUES OR GENERATE REVENUE FROM NEW SOURCES
     WOULD PREVENT US FROM ACHIEVING AND MAINTAINING PROFITABILITY.

Currently, our revenues are generated primarily from sales of subscriptions to
the telecommunications and cable television services offered on our network and
to a lesser extent from prepaid phone card operations and resales of long
distance telephone minutes and advertising sales. Our continued ability to
remain in business depends upon, among other things, our ability to increase
revenues from our current sources and generate revenues from additional
sources. If we are unable to increase our revenues from our current sources and
generate revenue from other sources, we may be required to curtail or cease our
operations. We may not be able to sustain our current revenues or successfully
generate additional revenue.

     OUR CONTINUED NASDAQ NATIONAL MARKET LISTING IS NOT ASSURED.

Our common stock is presently authorized for quotation on the Nasdaq National
Market. We remain subject to all requirements of our listing agreement with
Nasdaq. Among the events which could cause us to have our status as a National
Market Issuer terminated are a failure to maintain a minimum bid price for our
common stock of $1.00 per share. Since October 2000, our common stock has traded
significantly below the minimum $1.00 bid. If the bid does not increase to at
least $1.00 for 10 consecutive trading days by February 2001, this could result
in our delisting or the need to effect a reverse stock split.


                                       16
<PAGE>   17


If we lose our Nasdaq National Market status, our common stock might trade in
the over-the-counter market, which is viewed by most investors as a less
desirable, less liquid marketplace. In such event, the market price of the
common stock may be adversely impacted and a stockholder may find it difficult
to dispose, or obtain accurate quotations as to the market value, of our common
stock.

     LIMITATIONS IMPOSED BY RESTRICTIVE COVENANTS COULD LIMIT HOW WE CONDUCT
BUSINESS AND OUR ABILITY TO GENERATE REVENUES AND PROFITS.

The indenture governing our 13% notes contains covenants that restrict our
ability to, among other things:

         -        incur additional debt;

         -        pay dividends and make other distributions;

         -        prepay subordinated indebtedness;

         -        repurchase capital stock;

         -        make investments and other restricted payments;

         -        engage in transactions with affiliates;

         -        engage in business other than the provision of
                  telecommunications, television, Internet and other related
                  services to the trucking industry;

         -        enter into sale and leaseback transactions;

         -        create liens;

         -        sell assets; and

         -        engage in mergers and consolidations and certain other events
                  which could cause an event of default.

As a result of these restrictions, we are limited in how we conduct our business
and in our ability to raise additional debt and to implement some of our
contemplated operational and financial strategies.

     IF WE DO NOT RETAIN OUR CURRENT SUBSCRIBERS OR INCREASE SALES OF
     SUBSCRIPTIONS TO SERVICES OFFERED ON OUR NETWORK, OUR RECURRING REVENUES
     WILL NOT INCREASE AND OUR INCREMENTAL COSTS OF ACQUIRING AND RETAINING
     CUSTOMERS MAY INCREASE.

Our future success depends upon our ability to significantly increase the number
of subscribers to services currently offered on our network and to increase our
revenues from our subscribers. The number of our total active subscribers has
not increased significantly since March 2000 and increases in subscribers to
date have been below expectations. Even if truck drivers initially subscribe to
our network, they may not renew their subscriptions. There are many factors that
could cause a subscriber to cancel an ongoing monthly subscription or fail to
purchase a subscription, including dissatisfaction with our network and the
services offered, or with the number and location of the truckstops at which our
network is available, or truck driver turnover. Truck drivers may be unwilling
to purchase a subscription to our Internet access service. Many truck drivers
may not own a computer for accessing the Internet. If ongoing monthly
subscriptions do not increase, our recurring revenues will not increase, our
incremental costs of acquiring and retaining subscribers may increase and our
business may suffer. We intend to slow significantly the buildout of our network
during our fiscal year ending June 30, 2001 and deployed our network at only six
additional sites in the three months ended September 30, 2000. This slowdown in
our buildout schedule may negatively impact any increase in our subscribers and
our revenues.


                                       17
<PAGE>   18


     IF ELECTRONIC COMMERCE TRANSACTIONS ON OUR PORTAL WEBSITE DO NOT DEVELOP,
     WE MAY NOT BE ABLE TO OPERATE OUR PORTAL OR OUR BUSINESS PROFITABLY.

To date, we have been unable to develop and generate any meaningful revenue
from electronic commerce activities on our portal website. If we are unable to
develop electronic commerce activities on our portal or if business-to-business
electronic commerce within the trucking industry does not grow or grows more
slowly than expected, our portal website and our business may not achieve or
maintain profitability. Many truck drivers may not have a computer for
accessing the Internet from their trucks which may adversely affect the growth
of electronic commerce in the trucking industry and on our portal.

     IF THE INTERNET IS NOT ADOPTED AS AN ADVERTISING MEDIUM OR IF WE CANNOT
     ATTRACT ADVERTISERS, OUR ADVERTISING REVENUES WILL NOT INCREASE AS PLANNED.

We began publishing Connect! in July 1999 and launched our portal in October
1999. Although we have generated revenues from sales of advertising, to date
these revenues have been insufficient to cover the related costs. If we do not
successfully develop content for Connect! and the portal that attracts a
significant number of truck drivers and other trucking industry participants,
it is unlikely that we will be able to attract sufficient advertisers to cover
our costs. The growth of Internet advertising requires validation of the
Internet as an effective advertising medium. This validation has yet to fully
occur. Acceptance of the Internet among advertisers will also depend on growth
in the commercial use of the Internet. If we do not generate advertising
revenue or if widespread commercial use of the Internet does not develop, or if
the Internet does not develop as an effective and measurable medium for
advertising, our revenues will not increase as planned and we may not be able
to operate our portal website or business profitably.

     IF WE DO NOT MEET OUR OBLIGATIONS UNDER CONTRACTS WITH TRUCKSTOP OPERATORS,
     THESE TRUCKSTOP OPERATORS MAY ENTER INTO CONTRACTS WITH OTHER PROVIDERS.

Most of our current revenues are generated from our operations at truckstops.
We expect that the provision of telecommunications, cable television and
Internet access services through our network will continue to be a primary
source of revenue for the foreseeable future. TravelCenters of America owns or
operates over 150 of the truckstops that we have under contract. We also have a
contract with TravelCenters of America to provide a total telecommunications
system, including prepaid phone cards, public phone operations and public
Internet kiosks, to approximately 120 truckstops. We have contracted with
truckstop operators located throughout the United States. While most
independent truckstop owners who own a single truckstop execute a standard
contract, the contracts executed by truckstop chains that operate multiple
truckstops vary significantly. These contracts generally provide that the
truckstop chains and independent truckstop owners may terminate the contracts,
and our rights under the contracts, if we fail in any material respect to
perform any of our obligations under the contracts and fail to remedy the
breach within 30 days after we receive notice of the breach. Any failure by us
to meet our contractual obligations that results in the termination of our
contracts could impair our network and the sale of services over our network.

     OUR CONTRACTS WITH TRUCKING ASSOCIATIONS TO INSTALL OUR NETWORK AT
     APPROXIMATELY 300 MEMBER TRUCKSTOPS ARE NOT LEGALLY BINDING ON THEIR
     MEMBERS AND MAY NOT RESULT IN THE INSTALLATION OF OUR NETWORK AT THESE
     TRUCKSTOPS.

As of June 30, 2000, we had entered into contracts with the three largest
trucking associations representing more than 300 additional independent
truckstops pursuant to which these associations have agreed to permit us to
offer our services to their members. These associations do not have authority
to legally bind their members. Therefore, while each association has granted us
the right to offer cable television and telephone services to their members,
this contractual provision is not binding on any member. Prior to installation
of our network at an association member's truckstop, we must enter into a
contract with the association member granting us the right to install our
network at the member's truckstops. Accordingly, our contracts with truckstop
associations may not result in our network being installed at additional
truckstop locations. In addition, we have determined to significantly slow the
deployment of our network to conserve our remaining cash and did not deploy or
network at any additional truckstop sites in the three months ended September
30, 2000.


                                       18
<PAGE>   19




    OUR TELECOMMUNICATIONS AND CABLE TELEVISION SERVICES COMPETE WITH THOSE
    OFFERED BY MANY WELL-ESTABLISHED COMPETITIVE PROVIDERS.


The market for telecommunications services, particularly long distance
telecommunications services, is highly competitive. Carriers compete
principally on the basis of ease of access, functionality and cost. Our
telecommunications services currently compete with traditional long distance
services, with public phones, cellular and other wireless telephones, calling
cards, prepaid phone cards, as well as collect call and toll-free number
services. We believe that drivers currently use public phones located at
truckstops for a significant number of the calls they make and we may not
successfully attract drivers who predominantly use these public phones.
Moreover, we face particular constraints in our ability to keep our prices
competitive for our prepaid phone cards. Specifically, our contractual
arrangements with third parties relating to the prepaid phone cards that we
offer may make it difficult or impossible for us to reduce our prices for
prepaid long distance minutes to compete effectively on a profitable basis.
Finally, competitive pressures on companies like ours in the long distance
telecommunications sector, in particular, also seems likely to increase with
the entry of one or more Regional Bell Operating Companies into their own home
long distance markets, which appears imminent. Competition in the markets for
cable and other video services is becoming increasingly more competitive. While
our competition today largely consists of alternatives located outside the
truck cab and primarily in the truckstop (e.g., community television and game
rooms inside the truckstop), we believe that some professional truck drivers
have purchased direct broadcast satellite dishes to receive television
programming in their cabs. Cable, direct broadcast satellite, and other video
service providers to such users as residential apartment buildings could seek
to compete by offering cable television programming to truckstops. We may not
be able to compete successfully against these providers, most of which will
have access to greater resources and provide more programming than our network.
Some of our competitors, including those arising from the consolidation of or
strategic alliances between telecommunications and/or cable television
companies are well established companies with significantly greater financial,
marketing and programming resources than we have. Our failure to compete
successfully with these and future competitors, including those arising from
the emergence or increased utilization of new and developing technologies,
could have a material adverse effect on our financial condition and results of
operation.

     COMPETITION FOR OUR INTERNET ACCESS SERVICES IS LIKELY TO INCREASE IN THE
     FUTURE AND MAY PRECLUDE US FROM OFFERING THESE SERVICES ON A PROFITABLE
     BASIS.

The market for providing Internet access is extremely competitive and highly
fragmented. There are no substantial barriers to entry, and we expect that
competition will continue to intensify. We may not be able to compete
successfully against current or future Internet service providers, many of whom
may have financial resources greater than ours. Increased competition could
cause us to increase the sales and marketing expenses related to our Internet
access services as well as cause our users to obtain Internet access from other
sources. We may not be able to offset the effects of these increased costs
through an increase in the number of subscribers to our Internet access service
and we may not have the resources to continue to compete successfully as an
Internet service provider. We believe that new competitors, including large
computer hardware and software, media, and telecommunications companies, will
continue to enter the Internet access market. As consumer awareness of the
Internet grows, existing competitors are likely to further increase their
emphasis on their Internet access services, resulting in even greater
competition. In addition, telecommunications companies may be able to offer
customers reduced communications costs in connection with these services,
reducing the overall cost of their Internet access solutions and significantly
increasing pricing pressures on our Internet access services. The ability of
our competitors to acquire other Internet service providers, to enter into
strategic alliances or joint ventures or to bundle other services and products
with Internet access could also put us at a significant competitive
disadvantage. We have deployed public Internet kiosks in the truckstops of two
major chains. Our revenues to date have been less than anticipated. There is at
least one company that has installed Internet/e-mail kiosks in a number of
truckstops.

     COMPETITION FOR OUR CURRENT AND PLANNED INTERNET PRODUCTS AND SERVICES IS
     LIKELY TO INCREASE IN THE FUTURE AND MAY PREVENT US FROM ESTABLISHING
     CUSTOMER AND ADVERTISING BASES FROM WHICH TO GENERATE REVENUES AS PLANNED.

Competition for Internet products and services and electronic commerce is
intense. We expect that competition will continue to intensify. Barriers to
entry are minimal, and competitors can launch new websites at a relatively low
cost. Various websites currently exist that provide content and commerce
solutions to the trucking community. Several of these websites have market
acceptance, established customer and advertising bases and offer a greater
variety of content and applications


                                       19
<PAGE>   20


than our portal may initially offer. Our competitors may develop new Internet
products or services that are superior to, or have greater market acceptance
than, our products and services.

     WE ARE DEPENDENT ON THIRD PARTIES FOR THE PUBLIC PHONE AND PREPAID PHONE
     CARD OPERATIONS WE OFFER AND, IF THESE THIRD PARTIES DISCONTINUE DOING
     BUSINESS WITH US, WE MAY NOT BE ABLE TO MAINTAIN THESE OPERATIONS IF WE
     ARE UNABLE TO FIND ADEQUATE REPLACEMENTS.

We are currently dependent on third parties for the public phone and a portion
of the prepaid phone card operations that we offer truckstops. We are obligated
to provide public phone operations in the truckstops of one major chain. We
have contracted with a third party to provide these operations and do not
intend to provide this service directly. This third party's failure to provide
public phone operations would result in our breach of our contract with the
truckstop chain. Our system is currently unable to provide all of the
components necessary for prepaid phone card operations. Although we believe
that other third parties could provide these services for us or, over time, we
could develop the systems so that we could provide these services, any
inability to rely on third party systems without disruption prior to such
development would eliminate our ability to offer prepaid phone card operations
to truckstops.

     WE DEPEND ON THIRD PARTIES TO SUPPLY US WITH PROGRAMMING AND EQUIPMENT
     AND, IF THESE THIRD PARTIES DISCONTINUE DOING BUSINESS WITH US, OUR
     ABILITY TO PROVIDE COMPETITIVE TELECOMMUNICATIONS AND CABLE TELEVISION
     SERVICES MAY SUFFER IF WE ARE UNABLE TO FIND ADEQUATE REPLACEMENTS.

We purchase our satellite equipment, headend equipment, telephone switching
equipment, computer hardware and cable programming from outside suppliers and
do not have purchase agreements with any supplier. We presently purchase our
satellite equipment and computer hardware from a sole supplier and we believe
that limited alternative sources for these items exist. If we were required to
purchase alternative telephone switching equipment from another source, it
would require the reprogramming of some of our software or if we were required
to purchase any alternative equipment from another source, it could require
that we modify and redesign our network in certain respects which, in each
case, could result in service delays and expense to us. In addition, we
purchase the cable programming offered on our network from Echostar. Although
we believe that limited alternative sources for cable programming exist,
utilizing an alternative source could require retrofitting certain equipment at
each truckstop site and could result in an interruption in our ability to offer
cable television services through our network for a limited period of time. If
we are unable to obtain any of the foregoing equipment, particularly telephone
switching equipment, or cable programming, our ability to buildout and operate
our network and expand our business in a timely fashion could suffer. We depend
on a few third-party suppliers of hardware components. Currently, we acquire
routers used to provide our networking services from only one source. From time
to time, we have experienced delayed delivery from some suppliers. If we are
unable to develop alternative sources of supply, if required, we could
experience delays and increased costs in expanding our network infrastructure.

     SECURITY BREACHES OF OUR NETWORK AND INAPPROPRIATE USE BY INTERNET USERS
     COULD DISRUPT OUR SERVICE AND PREVENT US FROM INCREASING OUR SUBSCRIBER
     BASE AND DISRUPT TRANSACTIONS ON OUR NETWORK.

The future success of our business will depend on the security of our network
and, in part, on the security of the network infrastructures of our third-party
providers, over which we have no control. Despite the implementation of
security measures, our infrastructure is vulnerable to computer viruses or
similar disruptive problems. Computer viruses or problems caused by third
parties, including the sending of excessive volumes of unsolicited bulk e-mail
or "spam," could lead to interruptions, delays, or cessation in service to our
subscribers. Third parties could also potentially jeopardize the security of
confidential information stored in our computer systems or our subscribers'
computer systems by their inappropriate use of the Internet, which could cause
losses to us or our subscribers or deter persons from subscribing to our
services. Inappropriate use of the Internet includes attempting to gain
unauthorized access to information or systems, commonly known as "cracking" or
"hacking." Although we intend to continue to implement security measures to
prevent this, "hackers" have circumvented security measures adopted by others
in the past, and may be able to circumvent our security measures in the future.
To alleviate problems caused by computer viruses or other inappropriate uses or
security breaches, we may have to interrupt, delay, or cease service to our
subscribers, which could result in cancellations of subscriptions, failures to
renew subscriptions or reduced sales of subscriptions. In addition, we expect
that our subscribers will increasingly use the Internet for commercial
transactions in the future. Any network malfunction or security breach could
cause these


                                       20
<PAGE>   21


transactions to be delayed, not completed at all, or completed with compromised
security. Subscribers or others may assert claims of liability against us as a
result of any failure by us to prevent these network malfunctions and security
breaches. Until more comprehensive security technologies are developed, the
security and privacy concerns of existing and potential subscribers may inhibit
the growth of the Internet service industry in general and our subscriber base
and revenues in particular.

     WE MAY INCUR SUBSTANTIAL EXPENSES OR DISCONTINUE CERTAIN SERVICES IF WE
     ARE FOUND LIABLE FOR INFORMATION DISSEMINATED ON OUR NETWORK OR IF WE MUST
     IMPLEMENT MEASURES TO REDUCE OUR EXPOSURE TO THESE LIABILITIES.

Since the law relating to liability of Internet service providers for
information carried on or disseminated through their networks is not settled,
even with the defenses available in Section 223 of the Communications Decency
Act of 1996 and the recent enactment of the Digital Millennium Copyright Acts,
we may be subject to such liability. A number of lawsuits have sought to impose
liability for defamatory speech, indecent materials and infringement of
copyrighted materials. The United States Supreme Court has let stand a lower
court ruling that an Internet service provider was protected from liability for
material posted on its system by a provision of the Communications Decency Act.
However, the findings in that case may not apply in other circumstances. Other
courts have held that online service providers and Internet service providers
may be subject to damages for copying or distributing copyrighted materials.
Provisions of the Communications Decency Act that imposed criminal penalties for
using an interactive computer service for transmitting obscene or indecent
communications have been found unconstitutional by the United States Supreme
Court. However, the Child Online Protection Act requires limits on access to
pornography and other material deemed "harmful to minors." This legislation
imposes criminal penalties and civil liability. Numerous states have adopted or
are adopting similar types of legislation. We may be subject to claims relating
to content that is published on or downloaded from our site. We also could be
subject to liability for content that is accessible from our website through
links to other websites or that is posted by users in chat rooms or bulletin
boards. Potential liability imposed on Internet service providers like us for
material carried on or disseminated through our network could require us to
implement measures to reduce our exposure to that liability. These measures may
require us to spend substantial resources or discontinue certain service
offerings. We do not have errors and omissions insurance that would cover claims
relating to these risks. The imposition of liability could expose us to
significant costs and cause our business to suffer.

     WE MUST ADAPT TO TECHNOLOGY TRENDS AND EVOLVING CUSTOMER NEEDS OR WE WILL
     NOT BE COMPETITIVE.

The services that we offer through our network are characterized by evolving
technology, changes in customer needs, rapidly growing competition and frequent
new product and service introductions. Our future success will depend, in part,
on our ability to:

         -        effectively use and offer leading technologies;

         -        continue to develop our technical expertise;

         -        enhance our current networking services;

         -        develop new products and services that meet changing customer
                  needs;

         -        advertise and market our services; and

         -        influence and respond to emerging industry standards and other
                  technological changes.

We must accomplish these tasks in a timely and cost-effective manner. New
technologies, such as broadband wireless, or industry standards may replace or
provide lower cost alternatives to our existing products and services or could
render our existing products and services noncompetitive and adversely affect
their marketability. We also believe that our ability to compete successfully
depends on the continued compatibility and interoperability of our services
with products and architectures offered by other vendors. Although we intend to
support emerging standards in the market for the Internet and


                                       21
<PAGE>   22


other network connectivity, new industry standards could emerge, and we may not
be able to conform to these new standards in a timely fashion and maintain a
competitive position in the market. Our pursuit of necessary technological
advances and maintenance of technological compatibility may require substantial
time and expense.

     BECAUSE WE DO NOT HAVE REMOTE BACK-UP FACILITIES, THE FAILURE OF OUR
     COMPUTER AND COMMUNICATIONS HARDWARE SYSTEMS COULD RESULT IN CUSTOMER
     DISSATISFACTION AND REDUCED USE OF OUR NETWORK.

We depend on the efficient and uninterrupted operation of our computer and
communications hardware systems in Coral Springs, Florida. However, we do not
have remote back-up facilities for our computer systems. Interruptions could
result from natural disasters, technical failures, including power loss, the
failure of telecommunications equipment and systems and similar events. Any
interruptions in the delivery of our services could result in customer
dissatisfaction and which in turn could adversely affect usage of our network
and our revenues.

     OUR FAILURE TO COMPLY WITH THE BURDENSOME GOVERNMENT REGULATIONS OF THE
     TELECOMMUNICATIONS INDUSTRY OR CHANGES IN THESE REGULATIONS COULD RESULT
     IN OUR INABILITY TO PROVIDE CERTAIN SERVICES AND COULD DECREASE OUR
     REVENUES AND INCREASE OUR COSTS.

Regulation of the telecommunications industry is changing rapidly. As a
provider of telecommunications services nationwide, we are subject to varying
degrees of regulation in each of the jurisdictions in which we provide our
services. Laws and regulations, and the interpretation of such laws and
regulations, differ significantly among the jurisdictions in which we operate.
These laws and regulations are, moreover, subject to changes as a result of
ongoing regulatory implementation proceedings, subject to review by courts and
otherwise. This is particularly true in regard to Internet services, which,
while not heavily regulated at this time, are the subject of intense debate
over the degree that they should be regulated in the future, if at all. There
can be no assurance that future regulatory, judicial and legislative changes
will not have a material adverse effect on the company, that regulators and/or
third parties will not raise material issues with regard to our compliance or
non-compliance with applicable regulations, and/or that we will be in
compliance with all such laws and regulations at any one point in time.
Regulatory considerations that affect and may limit our business include:

         -        certification, tariffing and other market entry requirements;

         -        requirements to obtain prior approval from or notify the FCC
                  and state public utility commissions of certain corporate
                  actions including transfers of control of certificated
                  carriers, transfers of carrier assets including customer
                  bases, carrier stock offerings, the incurrence by carriers of
                  significant indebtedness and name changes; and

         -        universal service and other ongoing filing and, in some cases,
                  contribution requirements.

Delay or failure in complying with applicable regulations could result in
sanctions, including fines or other penalties, and our authorizations being
conditioned, modified, canceled, terminated or revoked, which would limit or
eliminate our ability to provide telecommunications services. Conditions,
modifications, cancellations, termination or revocation could result in a
significant loss of revenues and may cause our business to suffer. We may be
subject to sanctions, including fines, penalties, and/or revocation of our
existing authorizations for our provision of telecommunications services in
certain jurisdictions prior to our having obtained necessary regulatory
authorization. We may also be subject to fines or other sanctions for failure
to seek prior approval, where necessary, for certain corporate actions, and/or
failure to notify the FCC and/or state public utility commissions in a timely
enough fashion.

     IF WE BECOME SUBJECT TO GOVERNMENTAL REGULATION OF CABLE TELEVISION
     COMPANIES, WE COULD INCUR SIGNIFICANT COSTS AND THE CONTINUED BUILDOUT OF
     OUR NETWORK COULD BE DELAYED.

Cable television companies are subject to extensive governmental regulation.
Because our cable system equipment is installed exclusively on private
property, we do not believe that we are subject to such regulations. Were we to
be required


                                       22
<PAGE>   23


to comply with such regulations, however, our business may suffer due to greatly
increased expense, potential delay or prevention of the continued buildout of
our network and management distraction.

     OUR INTERNET ACCESS SERVICE MAY BECOME REGULATED BY THE FEDERAL
     COMMUNICATIONS COMMISSION OR OTHER GOVERNMENT AGENCIES WHICH COULD
     DECREASE OUR REVENUES AND INCREASE OUR COSTS.

Internet service providers are not currently regulated like telecommunications
service providers by the Federal Communications Commission or any other United
States governmental agency. Nevertheless, Internet-related regulatory policies
are continuing to develop, primarily as determined by the industry itself, and
it is possible that we could be exposed to direct governmental regulation in
the future. For example, in its April 10, 1998 Report to Congress, while
reaffirming that Internet service providers should be classified as
"information service providers" rather than regulated "telecommunications
providers" under the terms of the Telecommunications Act of 1996, the FCC
stated its intention to consider whether to regulate voice and fax telephony
services provided over the Internet as "telecommunications" even though
Internet access itself would not be regulated. We cannot predict whether in the
future the FCC will modify its current policies against regulation of Internet
service providers. Moreover, a number of state commissions have initiated
proceedings relating to the regulation of, and adopted laws impacting, certain
Internet-related services. Others could do the same in the future. Due to the
increasing popularity and use of the Internet, it is possible that additional
laws and regulations may be adopted with respect to the Internet, covering
issues such as content, privacy, access to some types of content by minors,
pricing, bulk e-mail or "spam," encryption standards, consumer protection,
electronic commerce, taxation, copyright infringement, and other intellectual
property issues. Internet service providers are, of course, subject to certain
regulations applicable to businesses generally. We cannot predict the impact,
if any, that any future regulatory changes or developments may have on our
business, financial condition, and results of operations. Changes in the
regulatory environment relating to the Internet services industry, including
regulatory changes that directly or indirectly affect telecommunications costs
or increase the likelihood or scope of competition from regional telephone
companies or others, could increase our costs and make it difficult for us to
compete effectively.

     THE PROVISIONS OF OUR CERTIFICATE OF INCORPORATION, BYLAWS AND DELAWARE
     LAW THAT HINDER A CHANGE IN CONTROL COULD NEGATIVELY AFFECT OUR COMMON
     STOCK PRICE, DISCOURAGE BIDS FOR OUR COMPANY OR REDUCE ANY PREMIUMS THAT
     COULD BE PAID TO OUR STOCKHOLDERS.

Provisions of our certificate of incorporation and bylaws may discourage, delay
or make more difficult changes in control that are not approved by our board of
directors or prevent the removal of incumbent directors. The existence of these
provisions may have a negative impact on the price of the common stock and may
discourage third-party bidders from making a bid for our company or may reduce
any premiums paid to stockholders for their common stock. In addition, our 13%
notes are redeemable on changes in our control and the removal of directors
under certain circumstances, which may have a similar effect. In particular,
these provisions prohibit stockholder action by written consent, require
advance notice for nomination of directors and for stockholders proposals and
allow only the chairman of the board or a majority of the directors to all a
special stockholders' meeting. We have 8,750,000 shares of preferred stock
authorized, none of which is currently designated. As a result, our board of
directors may designate and issue preferred stock without stockholder approval.
Furthermore, as a Delaware corporation, we are subject to Section 203 of the
Delaware General Corporation Law. In general, this law prevents a person who
becomes the owner of 15% or more of the corporation's outstanding voting stock
from engaging in specified business combinations for three years unless
specified conditions are satisfied.

     OUR STOCK PRICE HAS BEEN AND WILL BE VOLATILE.

The stock market has experienced extreme price and volume fluctuations. The
market prices of the securities of Internet-related and technology companies
have been especially volatile. The trading prices of many Internet-related and
technology companies' stocks have reached historical highs within the last 52
weeks and have reflected relative valuations substantially above historical
levels. During the same period, these companies' market prices have also been
highly volatile and have recorded lows well below their historical highs. Since
our initial public offering in November 1999, we have suffered significant
declines in the market price of our common stock and low trading volumes. The
trading price of our common stock may continue to decline or may fluctuate in
the future. In the past, companies that have experienced volatility in the


                                       23
<PAGE>   24


market price of their stock have been the object of securities class action
litigation. If we were the object of securities class action litigation, it
could result in substantial costs and a diversion of our management's attention
and resources.

     FUTURE SALES OF OUR COMMON STOCK MAY NEGATIVELY AFFECT OUR STOCK PRICE.

We have a large number of shares of common stock outstanding and available for
resale beginning at various points in time in the future. The market price of
our common stock could decline as a result of sales of a large number of shares
of our common stock in the market, or the perception that such sales could
occur. These sales also might make it more difficult for us to sell equity
securities in the future at a price that we think is appropriate, or at all.

     WE MAY NOT HAVE IDENTIFIED ALL THE RISKS AND UNCERTAINTIES THAT WE MAY
     FACE.

The risks described in this section or elsewhere in this report are not the
only ones that we may face. Although this report includes the material risks
that we are aware of at this time, additional risks that are not yet identified
or that we currently think are immaterial may materially adversely affect our
business, results of operations and financial condition in the future.

ITEM 3.  QUANTITATIVE AND QUALITATIVE DISCLOSURE ABOUT MARKET RISK

The following discusses our exposure to market risk related to changes in
interest rates, equity prices and foreign currency exchange rates. This
discussion contains forward-looking statements that are subject to risks and
uncertainties. Actual results could vary materially as a result of a number of
factors including those set forth in the section entitled "Risk Factors." We do
not use any derivative financial instruments for hedging, speculative or
trading purposes.

As of September 30, 2000, we had short-term investments of approximately $22.0
million. Substantially all of the short-term investments consisted of highly
liquid investments with remaining maturities at the date of purchase of less
than one year. These investments are subject to interest rate risk and will
decrease in value if market interest rates increase. A hypothetical increase or
decrease in market interest rates by 10 percent from the September 30, 2000
rates would cause the fair value of these investments to decline by an
insignificant amount. We have the ability to hold these investments until
maturity and, therefore, we do not expect our operating results, cash flows or
the value of these investments to be affected to any significant degree by the
effect of a sudden change in market interest rates. Declines in interest rates
over time will, however, reduce our interest income.

We own equity investments in the amount of $4.0 million at September 30, 2000.
A hypothetical 10% change in fair value of these equity securities would result
in a $400,000 impact on our statement of operations.

At September 30, 2000, we had fixed interest rate debt of $75.0 million. A
hypothetical increase or decrease in market interest rates by 10% from the June
30, 2000 rates would not have a material impact on the fair market value of
this debt. We do not hedge any interest rate exposure.

All of our revenues are realized currently in U.S. dollars. In addition, we do
not maintain any asset or cash account balances in currencies other than the
United States dollar. Therefore, we do not believe that we currently have any
significant direct foreign currency exchange rate risk.

PART II - OTHER INFORMATION

ITEM 1.  LEGAL PROCEEDINGS.

In July 1999, Robert T. and Julie McCurry filed a lawsuit in Superior Court of
Shasta County, California against us and a truckstop chain at which our network
is deployed that seeks a total of $2.0 million in actual damages resulting from
an injury suffered by Mr. McCurry. The amount sought exceeds the limit of our
insurance policy. We are unaware of any issues which would result in the denial
of insurance coverage. The court ordered arbitration of the lawsuit. An
arbitration award has been handed down against the us and the other defendants
in the amount of $352,000. All defendants in the lawsuit are appealing the
arbitration award. We currently anticipate that the lawsuit will likely be set
for trial in the first quarter of 2001.

Due to the inherent uncertainty as to the outcome of this lawsuit, we cannot
estimate the amount of loss, if any, that will result from the resolution of
this matter, or whether this amount will be within our liability insurance
limit of $1.0 million for each truckstop at which our network is deployed.

ITEM 2.  CHANGES IN SECURITIES AND USE OF PROCEEDS.

         (c)      In the three months ended June 30, 2000, we did not issue any
unregistered securities.


                                       24
<PAGE>   25


         (d)      On November 30, 1999, we completed an initial public offering
of our common stock. The managing underwriters in this offering were CIBC World
Markets, Allen & Company Incorporated, Volpe Brown Whelan & Company and William
Blair & Company. The shares of common stock sold in the offering were registered
under the Securities Act of 1933, as amended, under a registration statement on
Form S-1 (the "Registration Statement") (File No. 333-87343) that was declared
effective by the SEC on November 23, 1999. Pursuant to the Registration
Statement, 3,750,000 shares of common stock were sold at a price to the public
of $17.00 per share. The aggregate offering price of the initial public offering
to the public was $63.8 million. In connection with this offering, we paid an
aggregate of $4.5 million in underwriting discounts to the underwriters.
Additional related expenses incurred by us through March 31, 2000 were
approximately $1.8 million. The net proceeds to us from the initial public
offering, after deducting underwriting discounts and commissions and other
offering expenses, were approximately $57.5 million.

         Of the net proceeds, through September 30, 2000, we have used $4.9
million to redeem our Series A preferred stock and $23.1 million for working
capital and capital expenditures. Pending use, the balance of the net proceeds
are invested in short-term, investment grade interest-bearing securities.

         Other than amounts paid in connection with the redemption of the
Series A preferred stock held by entities affiliated with Patricof & Co.
Ventures, Inc., with which one of our directors are affiliated and which, as of
June 30, 2000 beneficially owns approximately 15% of PNV's outstanding common
stock, none of the net proceeds of our initial public offering were paid
directly or indirectly to any director or officer or their associates, any
person owning 10% or more of any class of our equity securities of PNV, or any
affiliate.

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.

<TABLE>
<CAPTION>
   EXHIBIT NUMBER                DESCRIPTION OF EXHIBIT
   --------------                ----------------------
   <S>            <C>
        27.1           Financial Data Schedule.
</TABLE>
         (b)      Reports on Form 8-K (for SEC use only).

         No reports on Form 8-K were filed on behalf of PNV during the three
months ended September 30, 2000.


                                       25
<PAGE>   26



                                   SIGNATURES

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

                                 PNV INC.

                                 /s/ ROBERT P. MAY
                                 ----------------------------------------------
                                 Robert P. May, Chief Executive Officer and
                                 President


Date:  November 20, 2000         /s/ CASEY L. GUNNELL
                                 ----------------------------------------------
                                 Casey L. Gunnell, Chief Financial Officer



                                       26