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

                                  FORM 10-KSB

(Mark One)
[ X ]  Annual report pursuant to Section 13 or 15(d) of the Securities Exchange
       Act of 1934 [Fee Required] for the fiscal year ending September 30, 1996.
[   ]  Transition report under Section 13 or 15(d) of the Securities Exchange
       Act of 1934 [No Fee Required] for the transition period from
       _________________ to _________________.

Commission file number:  0-23364

                            MECKLERMEDIA CORPORATION
                            ------------------------
                 (Name of small business issuer in its charter)
 
           DELAWARE                                     06-1385519
-------------------------------            ------------------------------------
(State or other jurisdiction of            (I.R.S. Employer Identification No.)
 incorporation or organization)           
 
   20 Ketchum Street
  Westport, Connecticut                                   06880
---------------------------------                     --------------
 (Address of principal executive                        (Zip Code)
  officer)                                
 
Issuer's telephone number:  (203) 226-6967

Securities registered under Section 12(b) of the Act:  None

Securities registered under Section 12(g) of the Act:  Common Stock, $.01 Par
                                                       Value Per Share.

Check whether the issuer (1) filed all reports required to be filed by Section
13 or 15(d) of the Securities Exchange Act during the past 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 [    ]

Check if there if no disclosure of delinquent filers in response to Item 405 of
Regulation S-B contained in this form, and no disclosure will be contained, to
the best of registrant's knowledge, in definitive proxy or information
statements incorporated by reference in Part III of this Form 10-KSB or any
amendment to this Form 10-KSB. [ X ]

The Registrant's revenues for the most recent fiscal year were $30,594,000.

The aggregate market value of voting common stock held by non-affiliates of the
Registrant as of November 29, 1996, based upon of the last sale price of such
common stock on that date as reported by the NASDAQ National Market was $20 1/4.
The number of shares of the Registrant's Common Stock outstanding as of November
29, 1996, was 8,492,909.

Documents Incorporated by Reference:

Portions of Registrant's Proxy Statement for its Annual Meeting of Stockholders
to be held in 1997 are incorporated by reference in Part III of this Report.
Except as expressly incorporated by reference, Registrant's Proxy Statement
shall not be deemed to be part of this Form 10-KSB.

Transitional Small Business Disclosure Format: Yes [     ]  No [ X ]
<PAGE>
 
PART I

ITEM 1. BUSINESS
----------------

Introduction

The Company is a leading provider of information about the Internet through its
(i) publication of INTERNET WORLD, a monthly general circulation magazine, (ii)
publication of WEB WEEK, a biweekly business-to-business controlled circulation
newspaper, (iii) publication of WEB DEVELOPER, a bimonthly general circulation
magazine for technical, hands-on Internet professionals, (iv) INTERNET WORLD
trade shows and conferences, and (v) iWORLD, the Company's electronic daily
newspaper for Internet news and resources located on the World-Wide Web.  All of
the Company's products and services relate to providing Internet information to
business and information technology professionals, and consumers.

INTERNET WORLD is a leading magazine devoted exclusively to the Internet.
INTERNET WORLD, launched in 1993, was the first magazine on the market
exclusively edited for Internet users.  INTERNET WORLD provides its audience of
over 300,000 paid subscribers and newsstand buyers with information and analysis
about trends and technologies shaping the Internet as well as key issues of
fundamental importance to the community of Internet users.  As part of its
comprehensive coverage, INTERNET WORLD also presents profiles of the key
companies, people, and products that impact the Internet's growth and
development.  The first newsstand issue of INTERNET WORLD, published in October
1993, had paid circulation of approximately 18,000 and contained 16 pages of
paid advertising. The October 1995 issue of INTERNET WORLD had paid circulation
of approximately 227,000 and contained 52 pages of paid advertising. The October
1996 issue of INTERNET WORLD had paid circulation of approximately 320,000 and
contained 74 pages of paid advertising.  INTERNET WORLD's appeal to advertisers
is enhanced by an audit of its circulation performed by BPA International, one
of two recognized independent circulation auditing agencies.

WEB WEEK, a controlled circulation newspaper focused on Web technology and
business strategy, released its first issue in April 1995 as a monthly
publication, and increased its frequency in April 1996 to biweekly.  As a
resource for covering the latest innovations for the Internet as well as Web
technology for the Intranet, WEB WEEK reaches over 80,000 qualified Web
professionals with news, product analysis, and information.

WEB DEVELOPER, a bimonthly general circulation magazine with approximately
25,000 paid subscribers and newsstand buyers, was first published in October
1995.  WEB DEVELOPER is aimed at helping technical professionals and programmers
build, design, optimize, and maintain leading Web sites and Web applications by
providing them with in-depth tutorials, product testing and reviews, case
studies, programming tips, and interviews.

The Company also develops and produces INTERNET WORLD trade shows and
conferences for the Internet industry. Each trade show consists of seminars,
tutorials and an exhibit hall in which organizations pay for exhibition space.
The Company's principal trade shows are held in the fall and spring of each year
on the east and west coasts of the United States, respectively.  These events
are among the largest trade shows devoted exclusively to the Internet and the
World-Wide Web. The Company produced 17 and currently plans to produce 21
Internet-related shows and conferences in fiscal 1996 and 1997, respectively. Of
the 21 shows planned for 1997, 17 are planned to be held outside of the United
States and Canada.

In fiscal 1995, the Company determined that INTERNET WORLD magazine, as a result
of its market position and its complementary trade shows, together with the
growth, interest and visibility of the Internet, offered the greatest
opportunity for future growth, and that the potential of the Company's products
devoted to CD ROM technology, virtual reality and electronic books was more
limited. As a result, the Company sold its magazines CD ROM WORLD and VR WORLD.
In addition, the Company sold its COMPUTERS IN LIBRARIES magazine and related
trade shows, INTERNET RESEARCH journal and CD ROM's IN PRINT and OPAC
directories. The operations of unrelated assets sold, including those described
in Note 10 to the Consolidated Financial Statements, accounted for 11.3% of the
Company's revenues for fiscal 1995.

On August 22, 1995, the Company's Board of Directors approved a two-for-one
split of the Company's common stock in the form of a 100% stock dividend for
shareholders of record as of September 5, 1995, payable on September 19, 1995. A
total of 4,184,438 shares of common stock were issued in connection with the
stock split. All share and per share amounts, unless otherwise indicated, have
been restated to retroactively reflect the stock split.

The Company's principal executive office is located at 20 Ketchum Street,
Westport, Connecticut  06880, telephone: (203) 226-6967.

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Internet and Intranets

The Internet.  The Internet is a global collection of connected computers that
allows commercial and professional organizations, educational institutions,
government agencies, and consumers to communicate electronically, access and
share information, and conduct business.

Intranets. An Intranet is an internal network that is not for public domain
which utilizes Internet technology. Businesses use Intranets to enhance
communications among employees, thus allowing them to access important
information at their desktops. As security issues are resolved, Intranets may
ultimately replace LANs (local area networks) and WANs (wide area networks) and
simplify internal corporate communications. Based on these opportunities, many
companies are focusing their business strategies on Intranet technologies.

Expansion of Internet Usage.  Although the nature of the Internet makes a
precise count impossible, according to Intelliquest, there were approximately 35
million Internet users in the United States as of July 1996, an increase of
approximately 15 million users since July 1995. The continued increase in the
use of the Internet has resulted from recent technological advances, including
greater performance and capabilities of personal computers, improved browser
software, availability of low-cost, high-speed modems, as well as increased
business and consumer awareness of the potential advantages of the Internet. A
growing number of employees within organizations have access to the Internet
through their existing corporate networks. The Internet has emerged as a new
low-cost, world-wide medium for business-to-business marketing and
communication. Any business can now establish and maintain a global presence,
and market and distribute its products and services electronically. According to
Jupiter Communications, Inc., Internet-based advertising will increase from $300
million in 1996 to $5 billion by the year 2000. 0ther elements contributing to
the expansion of the Internet include the proliferation of low cost access as a
result of the rapid growth of Internet service providers including AT&T
WorldNet, Earthlink, Netcom Inc., CompuServe, Inc., PSINet and UUNet
Technologies, Inc.

Products and Services

The Company's products and services consist of the following:

MAGAZINES AND NEWSPAPER

INTERNET WORLD Magazine.  INTERNET WORLD is a four-color magazine containing
news concerning the Internet, expert commentary on the Internet, profiles of
Internet users, examples of Internet applications and reviews of new World-Wide
Web sites, software, databases, discussion groups and other new Internet-related
products and services. The Company published one issue of INTERNET WORLD in
fiscal 1993, eight issues in fiscal 1994, 11 issues in fiscal 1995 and 12 issues
in fiscal 1996. The newsstand price currently is $4.95 per issue. The
subscription rate varies from an introductory rate of $14.97 per year to a basic
rate of $29.00 per year. The October 1996 issue of INTERNET WORLD had estimated
paid newsstand circulation of approximately 60,000 and paid subscription
circulation of approximately 260,000. This issue contained 74 pages of paid
advertising.

For the October 1996 issue, INTERNET WORLD magazine's one-time, four-color
advertising rate was $12,500 per page as compared to $10,000 per page for the
October 1995 issue. INTERNET WORLD's appeal to advertisers is enhanced by an
audit of its circulation performed by BPA, one of two recognized independent
circulation auditing agencies. Effective with the January 1997 issue, INTERNET
WORLD magazine will charge a one-time, four-color rate of $15,000 per page of
advertising.

WEB WEEK Newspaper.  In May 1995, the Company began publishing WEB WEEK, a
controlled circulation business-to-business newspaper. A controlled circulation
periodical generally is provided without charge to readers who qualify by
meeting certain criteria established by the publisher and relies primarily on
space advertising for revenues. WEB WEEK is targeted for the Web development
community, including technical experts, company management and content
developers who are involved in creating, financing and maintaining sites on the
World-Wide Web. Effective with the first quarter of fiscal 1997, the Company
distributes approximately 93,000 copies of WEB WEEK per issue and has
approximately 80,000 qualified subscribers. WEB WEEK includes information
pertaining to technology infrastructure, strategy and content. The Company
believes that WEB WEEK appeals to advertisers that supply sophisticated World-
Wide Web products and services. Although WEB WEEK currently is published
biweekly, the Company presently anticipates publishing WEB WEEK weekly within
the next twelve months. WEB WEEK charges a one-time, four-color rate of $6,900

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per page for advertising with the rate increasing to $9,100 with the January 6,
1997 issue. The September 9, 1996 issue contained approximately 32 pages of paid
advertising.

WEB DEVELOPER Magazine.  In October 1995, the Company began publishing WEB
DEVELOPER, a bimonthly general circulation magazine for technical, hands-on
Internet professionals.  The Company published five issues in fiscal 1996 and
has plans to publish seven issues in fiscal 1997.  The newsstand price currently
is $5.95 per issue.  The subscription rate varies from an introductory rate of
$19.97 per year to a basic rate of $29.00 per year.  The September/October 1996
issue of WEB DEVELOPER had estimated paid newsstand circulation of approximately
9,500 and paid subscription circulation of approximately 15,000. This issue
contained approximately 27 pages of paid advertising.  WEB DEVELOPER charges a
one-time, four color rate of $4,435 per page for advertising.

TRADE SHOWS

INTERNET WORLD Trade Shows.  The Company produces INTERNET WORLD trade shows for
the Internet industry. Each trade show consists of seminars and tutorials and an
exhibit hall in which organizations pay for exhibition space. The Company's
principal trade shows are held in the fall and spring of each year on the east
and west coasts of the United States, respectively. By offering both print and
online publications, and trade shows devoted to the Internet, the Company
facilitates cross-marketing among its lines of business.

The Company has experienced significant growth in its Fall and Spring INTERNET
WORLD trade shows. At the Spring 1995 INTERNET WORLD trade show, there were
27,000 individuals attending and the Company sold, in the aggregate, 41,000
square feet of exhibit space. The Company's most recent Spring INTERNET WORLD
trade show held in San Jose, California in April 1996 was attended by
approximately 35,000 individuals. In addition, approximately 350 companies paid,
in the aggregate, for 120,000 square feet of exhibit space. The Company already
has under contract approximately 235,000 square feet of exhibition space for its
Fall 1996 INTERNET WORLD trade show and 240,000 square feet for its Spring 1997
INTERNET WORLD trade show.

The Company charges an admission fee ranging from $10 to $25 for individuals
attending the exhibit hall of its trade shows. To encourage attendance, the
Company offers complimentary passes to a large number of potential attendees. As
a result, the majority of attendees enter the exhibit hall free of charge.

The following table sets forth certain information regarding the Company's
current schedule of planned Internet-related trade shows and seminars.

                                                           Year
Name of Show                    Location                Introduced
------------                    --------                ----------           

 
FALL INTERNET WORLD         New York, New York              1993

 
SPRING INTERNET WORLD       Los Angeles, California         1994

 
INTERNET WORLD SUMMER       Chicago, Illinois               1997

 
INTERNET WORLD CANADA       Toronto, Canada                 1996
 
 
INTERNET WORLD ASIA         Kuala Lumpur, Malaysia          1996


INTERNET WORLD AUSTRALIA    Sydney, Australia               1995

  
INTERNET WORLD BRAZIL       Sao Paulo, Brazil               1996
                            Rio de Janeiro, Brazil          1996

                                       3
<PAGE>
 
INTERNET WORLD JAPAN        Tokyo, Japan                    1996

 
INTERNET WORLD KOREA        Seoul, Korea                    1996

 
INTERNET WORLD MEXICO       Mexico City, Mexico             1996

 
INTERNET WORLD BERLIN       Berlin, Germany                 1997

 
INTERNET WORLD PHILIPPINES  Manila, Philippines             1996

 
INTERNET WORLD MONTERREY    Monterrey, Mexico               1996

INTERNET WORLD INTERNATIONAL
@SINGAPORE                  Singapore                       1997

 
INTERNET WORLD ARGENTINA    Buenos Aires, Argentina         1997

 
INTERNET WORLD UK SPRING    London, England                 1997

INTERNET WORLD SHANGHAI,
CHINA                       Shanghai, China                 1997

 
INTERNET WORLD ISRAEL       Jerusalem, Israel               1997

 
INTERNET WORLD PORTUGAL     Lisbon, Portugal                1997

 
INTERNET WORLD HONG KONG    Hong Kong                       1997

 
INTERNET WORLD COLOMBIA     Bogota, Colombia                1997


WEB SITE

iWORLD.  In December 1994, the Company introduced iWORLD, a World-Wide Web site
that contains the latest news and resources for the Internet industry,
directories of Internet products and services, back issues of the Company's
print publications, and information about the Company's INTERNET WORLD trade
shows and conferences. The Company charges a fee for advertising space on
iWORLD. The Company promotes iWORLD in its publications and users can order the
Company's publications and register for its trade shows.

Strategy

The Company's strategy is to expand and capitalize on its position as a leading
provider of information about the Internet. The Company's strategy includes the
following:

Expand Circulation.  To increase INTERNET WORLD magazine's circulation, the
Company primarily relies on direct mail, supplemented by space advertising and
cross-promotion at its trade shows and through its Web site, iWORLD. In
addition, the Company works with its distributors to increase the number of
newsstands, bookstores and retail outlets that sell INTERNET WORLD magazine.
INTERNET WORLD magazine has expanded its paid circulation from approximately

                                       4
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227,000 for the October 1995 issue to approximately 320,000 for the October 1996
issue. The Company intends to continue to devote substantial resources to
expanding circulation.

Leverage the INTERNET WORLD Brand.  The Company intends to leverage the success
and recognition of its INTERNET WORLD brand to cross-promote its existing
publications, trade shows, and its World-Wide Web site, iWORLD.

Develop New Products and Services.  The Company plans to develop new products
and services to expand its presence among Internet users. In fiscal 1995, the
Company introduced iWORLD, launched in December 1994, and WEB WEEK newspaper,
launched in April 1995.  In fiscal 1996, the Company introduced WEB DEVELOPER
magazine, launched in October 1995. In April 1996, the Company increased the
frequency of WEB WEEK to biweekly.  In October 1996, the Company announced its
plans to publish INTERNET SHOPPER magazine by March 1997. In addition, in
November 1996, the Company announced its plans to produce a new trade show,
INTERNET WORLD SUMMER, in Chicago, Illinois, in July 1997.  There can be no
assurance that any new products and services, if introduced, will be successful.
The Company may acquire complementary products or businesses as opportunities
for such acquisitions arise.

Expand Internationally.  The Company's global presence includes licensed
editions of its publications throughout Europe, South America, Asia, Australia,
and the Middle East.  These licensed editions include English, Spanish,
Portuguese  and Japanese language versions.   Since the beginning of fiscal
1995, the Company has announced its plans to produce 17 new  INTERNET WORLD
trade shows throughout Europe, South America, Asia, Australia and the Middle
East.

Sales and Marketing

The Company offers providers of goods and services in the Internet industry
three types of advertising media consisting of periodicals, trade shows and a
World-Wide Web site. The Company's marketing strategy relies heavily on cross-
promotion using several approaches, including promoting its publications and
World-Wide Web site at trade shows, advertising its trade shows in its
publications and World-Wide Web site, and promoting both its trade shows and
publications on its World-Wide Web site. The Company offers discount packages
for customers purchasing advertising space in its publications and exhibition
space at its trade shows. Similarly, attendees at Company trade shows are
offered discount subscriptions to the Company's publications. The Company mails
brochures describing its INTERNET WORLD trade shows to subscribers receiving its
magazines and newspaper. The Company also uses advertising in its magazines and
newspaper, and trade show registration brochures to attract new subscribers.

The Company typically solicits new subscriptions through direct mail campaigns
targeted at subscribers of similar publications or purchasers of related
products and services. The Company's direct mail lists are generally rented from
mailing list rental firms or product or service vendors. The Company also
continuously attempts to renew existing subscribers through direct mail.
Periodicals are generally marketed as either paid circulation periodicals or
controlled circulation periodicals. A paid circulation periodical is purchased
by the reader, either by subscription or at the newsstand. A controlled
circulation periodical is generally provided without charge to readers who meet
certain criteria established by the publisher and relies exclusively on
advertisers in order to generate revenues. INTERNET WORLD and WEB DEVELOPER are
paid circulation magazines and WEB WEEK is a controlled circulation newspaper.

The Company's advertising, exhibition space sales and promotional activities are
performed by a 45-person staff consisting of 43 employees and 2 independent
sales representatives. The 2 independent sales representatives do not perform
marketing activities for any products that compete with the Company's products.
The Company's in-house sales staff is located in Connecticut, California,
Massachusetts, New York and the United Kingdom. Advertising sales presentations
are made both to marketing staffs within client organizations and to the
advertising agencies advising prospective advertisers. The Company's published
advertising rates for its general circulation magazines are based on paid
circulation and include discounts for multiple insertions. The Company's
published advertising rates for WEB WEEK, its controlled circulation newspaper,
are based on qualified circulation and include discounts for multiple
insertions.  Advertising agreements for the Company's general circulation
magazines and controlled circulation newspaper generally commit the advertiser
to place from one to 12 pages of advertisements within a 12-month period.

                                       5
<PAGE>
 
Production and Distribution

Publications.  The Company's publications are designed and edited by a
combination of in-house staff and freelance writers. These publications are laid
out on the Company's desktop publishing system which combines editorial material
with advertising space. Editorial and advertising material is then shipped in
electronic form to printers for production and distribution. The printer labels
and mails the Company's publications to subscribers in accordance with
subscriber lists maintained by a fulfillment house. In November 1994, the
Company signed a three-year contract with R.R. Donnelley & Sons Company ("R.R.
Donnelley") to print its general circulation magazine, INTERNET WORLD. In
November 1995, the contract with R.R. Donnelley was amended to include WEB WEEK
and WEB DEVELOPER. The Company has a newsstand distribution agreement (the
"Kable Agreement") with Kable News Company, Inc. ("Kable") pursuant to which
Kable has the exclusive right, subject to certain exceptions, to distribute the
Company's existing general circulation magazines and a first option to
distribute any of the Company's other current and future publications on such
terms as Kable and the Company may agree. Kable pays to the Company
approximately one-half the cover price for magazines it distributes, less credit
for copies returned to Kable by its customers. Kable has agreed to permit
distribution of the Company's general circulation magazines by another
distributor, International Periodical Distributors ("IPD"), in areas where Kable
or its wholesale customers are unable to provide service. The number of copies
and frequency of publication of each general circulation magazine are subject to
the mutual agreement of the Company and Kable, and any change in cover price is
subject to Kable's prior approval. The Kable Agreement expires in 1998, subject
to automatic renewal for subsequent five-year terms, unless either party gives
notice of termination. IPD distributes the Company's general circulation
magazines to certain retail outlets in the United States and Canada that do not
overlap with Kable's distribution. This agreement expires on August 31, 1997,
subject to automatic renewal. IPD purchases magazines for distribution for
approximately one-half the cover price, less credit for copies returned to IPD
by its customers. The Company uses Communications Data Services, Inc. for
fulfillment of its general circulation magazine subscriptions. The Company has
an agreement with Omeda Communications, Inc. for fulfillment of its controlled
circulation newspaper. The Company has also retained the right to sell directly
to individual subscribers at regular subscription rates.

Trade Shows.  Trade shows consist of an exhibition hall and seminar programs.
The Company retains seminar speakers on a show-by-show basis, with or without
fees as the Company deems necessary or appropriate. The Company contracts with
hotels and/or convention centers for meeting rooms and exhibition space. Fees
for such space are negotiated based on the amount of space required, guaranteed
hotel bookings and the length of the show. The Company typically contracts for
facilities for trade shows at least a year in advance.  The Company co-promotes
its international trade shows together with experienced trade show promoters in
the various locations where the trade shows are held.

Web Site.  iWORLD, the Company's daily electronic newspaper for Internet news
and resources located on the World-Wide Web, is designed and edited by a
combination of in-house staff and freelance writers.  The editorial content and
advertising space, which are maintained on the Company's in-house servers, are
updated on a daily basis.

Sales of Assets

On November 11, 1994, the Company sold CD ROM World to PC World Communications,
Inc. ("PC World") for $110,000 cash and assumption of the deferred subscription
liabilities of approximately $260,000. In addition, the Company received
proceeds in the form of advertising space and subscription list usage, and an
option exercisable by either the Company or PC World during certain specified
periods commencing in September 1997 and ending in January 2001, which requires
PC World to pay the Company an amount equal to 40% of the pretax income, for the
year for which the option is exercised, of PC World's Multimedia World magazine
or any successor publication, less $110,000 (the "Option Amount"). The January
1995 issue of CD ROM World was the last issue the Company published. In
connection with this sale, the Company has agreed, for a period ending two years
after the payment of the Option Amount, not to publish, market or distribute any
subscription publication of which the principal subject matter is computer
multimedia. The Company recognized a gain of $241,000 on the sale based on the
cash proceeds and deferred subscription liability assumed by PC World. No value
has been ascribed to the advertising space and subscription list usage and
income, if any, from the Option Amount will be recorded when received. CD ROM
World's revenues, costs of sales and direct costs, and advertising and promotion
expenses were approximately $925,000, $486,000 and $225,000, respectively, for
fiscal 1995.

On January 31, 1995, the Company sold the publishing rights to a directory known
as the OPAC Directory to Learned Information, Inc. for $8,000 and a short-term
note receivable of $8,000. The Company recognized a gain of $7,000 on the sale.

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On February 8, 1995, the Company sold its journal INTERNET RESEARCH to MCB
University Press for $100,000 and the assumption of INTERNET RESEARCH's deferred
subscription liabilities of approximately $33,000. The Company recognized a gain
of $133,000 on the sale.

On February 16, 1995, the Company sold its magazine COMPUTERS IN LIBRARIES and
rights to its trade show of the same name to Learned Information, Inc. for
$200,000, a non-interest bearing note receivable of $675,000 to be collected
over three years and the assumption of COMPUTERS IN LIBRARIES' deferred
subscription liabilities of approximately $180,000. The non-interest bearing
note receivable has been discounted at 9.0%. The Company recognized a gain of
$950,000 on the sale. COMPUTERS IN LIBRARIES magazine and trade show had
revenues, costs of sales and direct costs, and advertising and promotion
expenses of approximately $540,000, $351,000 and $46,000, respectively, for
fiscal 1995.

On May 18, 1995, the Company sold its publishing rights to CD ROMS IN PRINT to
Gale Research, a division of Thomson Information, Inc. for $278,000. The Company
recognized no material gain or loss on the sale for the year ended September 30,
1995.

On June 26, 1995, the Company sold its magazine VR WORLD to Miller Freeman, Inc.
in exchange for Miller Freeman, Inc. assuming the VR WORLD deferred subscription
liabilities of approximately $53,000. The Company recognized a gain of $11,000
on the sale for the year ended September 30, 1995.

Backlog

At September 30, 1996, the Company had a backlog of approximately $17.2 million
as compared to backlog of approximately $7.5 million at September 30, 1995. The
Company anticipates that the majority of its backlog at September 30, 1996 will
be recognized as revenue in the next 12 months. This backlog consisted of
prepayments for trade show and seminar registration and exhibition space,
subscriptions for its general circulation magazines and newspaper, and
commitments for advertising in the Company's publications. Orders for
advertisements are generally cancelable without penalty. The Company's backlog
at any particular date may not be indicative of the Company's actual revenues
for any succeeding fiscal period.

Competition

The market for Internet-related products and services is extremely competitive.
The Company's magazines INTERNET WORLD and WEB DEVELOPER and its newspaper WEB
WEEK compete for readers and advertising market share with numerous magazines
and newspapers, including general circulation and controlled circulation
Internet and personal computer magazines, and with non-print media such as
television, radio and cable. The Company competes directly with no fewer than 31
magazines and newspapers, and indirectly with numerous other information
technology publications. The Company's trade shows compete for exhibitors and
attendees with trade shows organized by Digital Consulting, Inc., International
Data Group, Softbank Comdex, Softbank Exposition and Conference Company, Gartner
Group, Inc., and to a lesser extent, numerous other technology-related trade
shows, including personal computer and computer network-related shows. Some of
the Company's trade show competitors are affiliated with major publishers of
technology-related books and magazines. As the number of Internet users has
increased dramatically, major magazine publishers, including CMP Media Inc.,
International Data Group and Ziff-Davis Publishing Company, have recently begun
to publish or have announced plans to publish magazines, newspapers and other
periodicals devoted to the Internet. Such competitors have substantially greater
financial, sales and marketing resources than the Company. As an online
publisher for the Internet industry, the Company's iWORLD Web site competes with
numerous other Web sites. There can be no assurance that the Company will not
face new or increased competition in its markets. Increased competition could
result in significant reductions in the average selling price of the Company's
publications, advertising rates and services. In addition, competition could
result in increased advertising and promotion expenses which could adversely
affect the Company's results of operations.

Trademarks and Copyrights

The Company registers each of its publications with the United States Copyright
Office. The Company's trademarks or service marks on the Principal Register of
the United States Patent and Trademark Office (the "PTO") include "MECKLERMEDIA"
and "MECKLER", and it has pending United States trademark applications for the
names "MECKLERMEDIA", "INTERNET WORLD", "WEB WEEK", "WEB DEVELOPER", "WEB
INTERACTIVE", "INTERNET SHOPPER", "INTERNET SHOPPER WORLD", "iWORLD", "IW LABS",
"WW LABS", "INTERNET ADVERTISING REPORT", "WEBADVERTISER", "INTERNET RESELLER",
"INTERNET RESELLER NEWS", "INTRANET WORLD", "INTRANET WORLD", "INFOCACHE, "ISP
WORLD", "WORLD WIDE WEB WEEK", "NET DAY", "THE LIST", "BROWSERWATCH", "WEB
POINTER", "ISDEX", "VR WORLD" , "VIRTUAL REALITY 

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WORLD", "WHERE THE INTERNET COMES ALIVE" and "WHERE THE INTERNET MEANS
BUSINESS". The Company has registered certain of its magazines and trade show
titles on the Supplemental Register of the PTO, which confers more limited
rights, beyond those available at common law, than does the Principal Register.
The Company has pending trademark applications for certain of these names in
various countries around the world. The Company has no patents, franchises or
concessions.

Regulation

The Company distributes its publications through the United States Postal
System, and is subject to regulations concerning the use of the mails, including
rate regulations.

Employees

As of September 30, 1996, the Company had 133 full-time employees, including 43
in marketing and circulation, 36 in editorial, 36 in administration and finance
and 18 in trade show operations and registrations. The Company is not party to
any collective bargaining agreement and has never experienced a work stoppage,
slowdown or strike. The Company believes that it maintains good employee
relations.

ITEM 2. DESCRIPTION OF PROPERTY
-------------------------------

The Company's principal executive offices are located in Westport, Connecticut,
where it leases an 18,699 square foot facility. The lease provides for monthly
rental payments of $11,687 (plus certain taxes and other landlord charges),
subject to annual increases, and expires on December 31, 1999. In addition, the
Company leases approximately 4,600 square feet in New York, New York. The lease
provides for monthly payments of $7,500 which expires November 30, 2001. The
Company also leases 3,790 square feet of space in Burlingame, California with
monthly lease payments of $7,179 which expires December 31, 2000, and 4,750
square feet of space in Wellesley, Massachusetts with monthly lease payments of
$6,008 which expires November 30, 2001. Mecklermedia UK leases a 1,550 square
foot facility in London, England at an approximate monthly rate of (Pounds)1,485
(approximately $2,324 at the exchange rate in effect on September 30, 1996) plus
certain taxes and other landlord's charges. The London lease expires on
September 24, 2000, with an option to vacate in September 1997. The rent due
under the London lease may be increased or maintained (but not decreased) at the
end of the fifth year. If the parties are unable to agree upon an adjustment of
the rent at that time, then either party may require that the issue be referred
to a valuer, whose determination will be binding on both parties. The lease also
provides that any adjusted rent may not be lower than the original rent. The
Company believes that these facilities will be adequate to meet its needs
through fiscal 1997.

ITEM 3. LEGAL PROCEEDINGS
-------------------------

The Company is not a party to any material pending legal proceedings.

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

         a)  The Registrant's 1996 Annual Meeting of Stockholders (the "Annual
             Meeting") was held on March 13, 1996.

         b)  Proxies were solicited by the Registrant's management pursuant to
             Regulation 14A under the Securities Exchange Act of 1934; there was
             no solicitation in opposition to management's nominees for director
             as listed in the proxy statement; and all of such nominees were
             elected for a one-year term.

         c)  The following matters were voted upon at the Annual Meeting with
             the voting results as indicated:

             1.  Proposal to approve the election of the individuals set forth
                 below to the Board of Directors of the Registrant to serve
                 until the 1997 Annual Meeting of Stockholders of the
                 Registrant.

<TABLE>
<CAPTION>
                 Nominee                Votes For  Votes Against  Votes Withheld
                 -------                ---------  -------------  --------------
<S>                                     <C>        <C>            <C>
 
                 Alan M. Meckler        6,334,486        -             4,050

                 Wayne A. Martino       6,299,386        -            39,150
</TABLE> 
 

                                       8
<PAGE>
 
<TABLE> 
<S>                                      <C>             <C>           <C>
                 Michael J. Davies       6,334,486       -             4,050
 
                 Walter H. Lippincott    6,334,486       -             4,050
</TABLE>

             2.  Proposal to authorize 26,000,000 additional shares of common
                 stock of the Registrant.

                 Votes For        Votes Against         Abstain
                 ---------        -------------         -------

                 6,164,000           162,220             12,316

             3.  Proposal to approve several amendments to the Registrant's 1995
                 Stock Option Plan regarding the automatic grant of options to
                 non-employee directors pursuant to a non-discretionary formula.
 
                 Votes For        Votes Against         Abstain
                 ---------        -------------         -------

                 6,268,560            57,010             12,966

             4.  Proposal to appoint Arthur Andersen LLP, independent
                 accountants, to act as auditors for the Registrant for the year
                 ending September 30, 1996.

                 Votes For        Votes Against         Abstain
                 ---------        -------------         -------

                 6,337,636               200                700

             There were no broker non-votes in connection with any of proposals
             listed above.

                                       9
<PAGE>
 
PART II
-------

ITEM 5. MARKET FOR COMMON EQUITY AND RELATED STOCKHOLDER MATTERS
----------------------------------------------------------------

The Common Stock of the Company began trading publicly on the NASDAQ Small Cap
Market on February 18, 1994, under the symbol "MECK." Prior to that date, there
was no public market for the Common Stock. The Common Stock has been traded on
the NASDAQ National Market under the same symbol since August 4, 1995. On
September 19, 1995, the Company paid a 100% stock dividend splitting the Common
Stock two for one. The following table sets forth for the periods indicated the
high and low sale prices of the Common Stock adjusted for the stock split. 

<TABLE>
<CAPTION>
     Fiscal 1996                          High          Low
     -----------                          ----          ---

<S>                                       <C>           <C>
1st Quarter                               $ 18 1/2      $  10 7/8
2nd Quarter                                 16              8 1/2
3rd Quarter                                 24 1/2         11 1/4
4th Quarter                                 21 3/4         14 1/2
 
     Fiscal 1995
     -----------
 
1st Quarter                               $  3 15/16    $   2 1/8
2nd Quarter                                  5 13/16        2 5/8
3rd Quarter                                 19 1/8          5 3/4
4th Quarter (through August 3, 1995)        18 7/8         16
NASDAQ National Market
----------------------
4th Quarter (beginning August 4, 1995)      24 3/8         15
</TABLE>

On September 30, 1996, the last sale price of the Common Stock was $18 per
share. As of November 29, 1996, there were 45 holders of record of Common Stock
and, to the Company's knowledge, approximately 1,200 beneficial holders of
Common Stock.

DIVIDEND POLICY

The Company has never declared or paid a cash dividend and does not anticipate
doing so in the foreseeable future. The Company expects to retain earnings to
finance the expansion and development of its business.

RECENT SALES OF UNREGISTERED SECURITIES

For the fiscal year ended September 30, 1996, the Company did not make any sales
of securities which were not registered under the Securities Act of 1933.

ITEM 6. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
-------------------------------------------------------------------------------
OF OPERATIONS
-------------

Introduction
------------

Since 1993, the Company has focused its efforts toward the Internet, launching
INTERNET WORLD magazine in August 1993.  The Company launched its INTERNET WORLD
trade shows in 1994.  In addition, the Company added its WEB WEEK newspaper and
iWORLD World-Wide Web site in 1995, and in October 1995, launched the magazine
WEB DEVELOPER.

The Company derives its revenues from subscription sales and newsstand
circulation of its magazines, the sale of paid advertising for its magazines and
newspaper, fees charged for exhibition space, seminars and ancillary services at
its trade shows, subscriber list rentals, advertising and other revenues from
iWORLD, the Company's World-Wide Web site, and royalties from publishing
licensing arrangements. Magazine and newspaper revenues from the sale of
advertising for any issue are recognized at the time the issue is circulated.
All newsstand magazines are sold on a returnable basis and the Company typically
receives approximately 50% of the cover price from the distributor for copies
sold. Newsstand revenues are recognized based on the estimated net sales of the
issue at the time of distribution, adjusted for prior periods. Historically,
adjustments have not been material. Subscriptions are prepaid and deferred
subscription liabilities are recorded at the time of payment. Subscription
revenues are recognized over the life of the subscription. Trade show revenues
derived from registration fees and exhibition space sales and ancillary services
are recognized at the time of the show. Trade show exhibition space sales are
contracted as far as one year in advance of the show. Companies that exhibit at
trade shows pay on the basis of the space that their exhibit occupies.

                                       10
<PAGE>
 
Since fiscal 1995, the Company has experienced significant increases in both
revenues and expenses. The primary contributors to the Company's revenue growth
during this period were increased circulation and paid advertising for its
INTERNET WORLD magazine, increased paid advertising for WEB WEEK newspaper and
increased attendance and exhibition space sales for INTERNET WORLD trade shows
and seminars. Increased expenses during this period were primarily attributable
to higher levels of advertising, promotion and selling, and general and
administrative expenses. As part of advertising, promotion, and selling
expenses, the Company defers realizable promotion costs on most direct mail
promotions for its general circulation magazines. These costs are amortized over
the periods of the subscriptions generated from these promotions not to exceed
one year. The Company anticipates that it will continue to incur significant
advertising, promotion and selling expense which may adversely affect the
Company's results of operations.

Results of Operations
---------------------

Revenues. Revenues for the year ended September 30, 1996, increased 111% to
approximately $30.6 million from $14.5 million for the comparable period in
fiscal 1995.  Of this $16.1 million increase, approximately $7.4 million was a
result of greater revenues from magazines and newspaper, including approximately
$5.7 million related to INTERNET WORLD, $2.4 million related to WEB WEEK and
$735,000 related to WEB DEVELOPER, offset by the reduction of approximately $1.3
million in revenues from publications divested by the Company. Advertising
revenue for INTERNET WORLD increased to approximately $6.5 million for the year
ended September 30, 1996, from approximately $2.4 million for the comparable
period in fiscal 1995 due to increased advertising volume and increased
advertising prices resulting from higher circulation.  Circulation revenue
increased for INTERNET WORLD to approximately $5.3 million from approximately
$3.8 million for the comparable fiscal 1995 period.  The increase in circulation
revenue reflects the growth in paid circulation which was approximately 320,000
for the October 1996 issue of INTERNET WORLD compared to approximately 227,000
for the October 1995 issue.  This increase in paid circulation resulted from
responses to direct mail subscription promotions and increased level of single
copy sales from newsstands.  Trade show revenues for the year ended September
30, 1996, of approximately $12.7 million increased by approximately $7.4
million, or 141%, from the comparable period in fiscal 1995.  This increase was
due primarily to the increase in exhibition space sales and registrations
related to Fall 1995 INTERNET WORLD, which had paid exhibition space of
approximately 60,000 square feet compared to 16,500 square feet for Fall 1994
INTERNET WORLD, an increase of 264%, and the increase in exhibition sales and
registrations for Spring 1996 INTERNET WORLD, which had paid exhibition space of
approximately 120,000 square feet compared to 40,000 square feet for Spring 1995
INTERNET WORLD, an increase of 200%.  In addition, the Company's INTERNET WORLD
Canada, INTERNET WORLD Home & Office Expo, WEB INTERACTIVE and WEB DEVELOPER
trade shows, all of which were new in Fiscal 1996, contributed to the increase
in trade show revenues, offset by the sale of the COMPUTERS IN LIBRARIES trade
show and the cancellation of the VR WORLD trade show. Other revenues increased
to approximately $2.4 million for the year ended September 30, 1996, from $1.1
million in the comparable period in fiscal 1995, due primarily to the continued
development and marketing of subscriber lists for rental, advertising and other
revenues from iWORLD, the Company's electronic daily newspaper located on the
World-Wide Web, and royalties from publishing licensing arrangements.

In November 1994, the Company sold CD ROM WORLD.  The January 1995 issue of CD
ROM WORLD was the last published by the Company.  Revenues for CD ROM WORLD for
the year ended September 30, 1995, were approximately $925,000.  In February
1995 the Company also sold its COMPUTERS IN LIBRARIES magazine and related trade
show and INTERNET RESEARCH journal which together accounted for revenues of
approximately $550,000 for fiscal 1995.  In addition, the directories CD ROMS IN
PRINT, BUSINESS AND LEGAL CD ROMS IN PRINT and GAMES AND ENTERTAINMENT ON CD
ROM, and the magazine VR WORLD were sold in fiscal 1995.

Cost of sales and direct costs.  Cost of sales and direct costs include the
costs associated with editing, producing and distributing the Company's
publications and costs associated with producing its trade shows.  Cost of sales
and direct costs for the year ended September 30, 1996, increased to
approximately $18.6 million from $8.9 million for the comparable period in
fiscal 1995.  Magazine and newspaper cost of sales and direct costs increased by
approximately $4.8 million for the year ended September 30, 1996, from the
comparable period for fiscal 1995. This increase was primarily attributable to
the higher print orders of INTERNET WORLD magazine which were raised to fulfill
a higher level of subscription and newsstand sales, and for direct mail
promotions.  In fiscal 1996, the print order for INTERNET WORLD totaled
approximately 6.4 million copies, a 2.3 million copy increase over the 4.1
million copies for fiscal 1995. The cost of sales and direct costs associated
with magazines and newspaper increased from approximately 62% to 63% of
magazines and newspaper revenue from fiscal 1995 to fiscal 1996. This percentage
increase is a function of the higher costs associated with the recent launch of
WEB DEVELOPER and the increase in publication frequency of WEB WEEK from monthly
to biweekly, offset by increased revenues received for INTERNET WORLD for
advertising and circulation.  Gross profit after cost of sales and direct costs
for magazines and newspaper for the year ended September 30, 1996, increased 85%

                                       11
<PAGE>
 
to approximately $5.7 million from $3.1 million for the comparable period in
fiscal 1995. Trade show cost of sales and direct costs for the year ended
September 30, 1996, increased by approximately $4.3 million to $7.9 million from
the comparable period in fiscal 1995. The increase was primarily due to the
expansion of both Fall 1995 INTERNET WORLD and Spring 1996 INTERNET WORLD, and
the introduction of INTERNET WORLD Canada, INTERNET WORLD Home & Office Expo,
WEB INTERACTIVE and WEB DEVELOPER trade shows, all of which were new in fiscal
1996. In addition, the costs associated with producing the Company's December
1995 VR WORLD trade show and in canceling the Company's future VR WORLD trade
shows contributed to the increase in cost of sales and direct costs over the
comparable period in fiscal 1995. Gross profit after cost of sales and direct
costs for trade shows for the year ended September 30, 1996, increased $3.2
million to approximately $4.9 million from $1.7 million for the comparable
period in fiscal 1995. The cost of sales and direct costs associated with trade
shows decreased from 67% to 62% of trade show revenue. This percentage decrease
is primarily attributable to the efficiencies of the larger Fall and Spring
INTERNET WORLD shows. Cost of sales and direct costs for other revenues
increased to $1.0 million for the year ended September 30, 1996, compared to
$313,000 in the comparable period in fiscal 1995, due primarily to the expansion
of the Company's iWORLD electronic daily newspaper located on the World-Wide Web
and costs associated with list rentals.

Advertising, promotion and selling expenses.  Advertising, promotion and selling
expenses represent costs related to circulation and promotion, including direct
mail, newsstand promotion and fulfillment expense, sales commissions, and
advertising and marketing staff. In addition, advertising, promotion and selling
expenses include the amortization of deferred promotion costs. Advertising,
promotion and selling expenses for the year ended September 30, 1996, increased
to approximately $9.9 million from $4.9 million for the comparable period in
fiscal 1995.  Of this increase, approximately $4.1 million was due primarily to
circulation marketing efforts designed to increase the circulation of INTERNET
WORLD magazine, including approximately $464,000 related to renewing existing
subscriptions. For the year ended September 30, 1996, the Company incurred
expenses of approximately $2.1 million promoting WEB WEEK and WEB DEVELOPER,
compared to $159,000 for the same period in fiscal 1995. In addition, increased
advertising revenues resulted in an increase in sales commissions paid to the
Company's sales representatives of approximately $346,000.

General and administrative expenses.  General and administrative expenses
include salaries, depreciation, telecommunications, insurance and professional
fees. General and administrative expenses for the year ended September 30, 1996,
increased 91% to approximately $6.8 million from $3.6 million for the comparable
period in fiscal 1995.  The increase related to costs required to support
current and anticipated growth of the Company.  Approximately $1.2 million of
this increase was due to personnel costs, $1.0 million was due to professional
fees for trademarks and other matters, $269,000 was due to increased
depreciation and amortization expense, and $158,000 was due to an increase in
the provision for bad debts resulting from increased advertising revenues. The
Company anticipates that future general and administrative expenses will
increase in the aggregate, although such expenses are expected to decline as a
percentage of revenue.

Interest income, net.  Interest income, net for the year ended September 30,
1996, increased to approximately $1.0 million from $299,000 for the comparable
period in fiscal 1995, due to the investment of the net proceeds from the August
1995 public offering.

Operating loss.  The operating loss for the year ended September 30, 1996,
increased to approximately $4.7 million from $2.9 million for fiscal 1995. The
increase in the operating loss was caused by the advertising, promotion and
selling expenses increasing 101% to $9.9 million in fiscal 1996 from $4.9
million in fiscal 1995 and general and administrative expenses rising 91% to
$6.8 million in fiscal 1996 from $3.6 million in fiscal 1995. The advertising,
promotion and selling expense increase was primarily a result of the circulation
promotion programs which were implemented to grow both the paid circulation of
INTERNET WORLD and the qualified controlled circulation of WEB WEEK, and as a
result of sales commissions resulting from greater advertising revenues. The
paid circulation of INTERNET WORLD increased 41% from 227,000 for the October
1995 issue to approximately 320,000 for the October 1996 issue. General and
administrative expense increased as a result of staff additions and related
costs to support the anticipated revenue growth of the Company.

United Kingdom operations.  Mecklermedia Limited ("Mecklermedia UK") is a London
based subsidiary of the Company. Revenues for Mecklermedia UK increased from
approximately $397,000 in fiscal 1995 to $432,000 in fiscal 1996, primarily as a
result of higher trade show revenues. Mecklermedia UK incurred losses from
operations of approximately $130,000 and $489,000, and net losses of $130,000
and $444,000 for the years ended September 30, 1996 and 1995 respectively. The
losses were partly due to the Company's efforts to increase the circulation of
the Company's magazines in the United Kingdom and Europe, and to maintain a
presence to facilitate the development of new trade shows outside of the United
States.

Net loss.  As discussed above, the Company's net loss resulted primarily from
the investments made in the circulation development programs for INTERNET WORLD
and WEB WEEK as well as investments in the staff added to support the

                                       12
<PAGE>
 
anticipated revenue growth of the Company. However, no assurance can be given
that either the anticipated revenue growth or improvement in fiscal 1997 results
will occur.


Liquidity and Capital Resources
-------------------------------

Since the beginning of fiscal 1994, the Company's primary sources of liquidity
have been the proceeds from sales of assets, borrowing under lines of credit
that have been repaid and its public offerings in February 1994 and August 1995.
On February 18, 1994, the Company completed its initial public offering of
2,300,000 shares of common stock, realizing net proceeds, after offering
expenses and underwriters' discount, of approximately $5.5 million. The net
proceeds of the initial public offering were used in part for the repayment of
notes payable, acquisitions of equipment, increases in various working capital
accounts related to the Company's publications and for trade show production,
with the remainder invested in cash and cash equivalents and short-term
investments.  On August 10, 1995, the Company completed a public offering in
which the Company sold 1,000,000 shares of common stock, realizing net proceeds,
after offering expenses and underwriters' discount, of approximately $15.2
million.  At September 30, 1996, the Company had cash and cash equivalents of
approximately $19.9 million, compared to $19.4 million at September 30, 1995.
Operating activities for the year ended September 30, 1996, provided
approximately $2.3 million in cash, due primarily to changes in components of
working capital, offset by a net loss of approximately $3.9 million for the
period.

The Company's accounts receivable increased to approximately $7.3 million at
September 30, 1996, from $2.3 million at September 30, 1995, primarily as a
result of the growth in advertising revenues in the period and advance billings
for exhibit space in future trade shows.  Deferred magazine revenue increased to
approximately $2.9 million at September 30, 1996, from approximately $2.1
million at September 30, 1995, reflecting growth in the subscription levels of
the magazines. Deferred trade show revenue increased to $12.1 million at
September 30, 1996, from $3.8 million at September 30, 1995, primarily as a
function of exhibitor payments received  and billings for participation in the
Fall 1996 and Spring 1997 INTERNET WORLD trade shows.  Accounts payable and
accrued expenses increased approximately $2.4 million primarily as a result of
expanded domestic and international trade show activity.

The Company had capital expenditures of approximately $1.0 million for the year
ended September 30, 1996.  This was primarily due to an increase in computer
equipment and software purchases required for the Company's general operating
activities and its iWORLD World-Wide Web site. The Company anticipates that it
will require a similar level of capital expenditures for fiscal 1997. During the
year ended September 30, 1996, the Company also incurred approximately $1.5
million in expenditures to register its various trade names in the United States
and throughout the world, and for trade show and Web site acquisitions.

The Company believes that funds available will be sufficient to meet its
obligations and its anticipated capital requirements for the foreseeable future.

Income Tax Matters
------------------

The Company's provision for income taxes for fiscal 1996 and 1995 is for foreign
income taxes and for state capital taxes. There is no net provision for federal
income taxes. At September 30, 1996 and 1995, the Company had future U.S.
federal and state income tax benefits of approximately $3.4 million and $1.1
million, respectively, which are primarily attributable to net operating losses,
the excess of amortization of intangibles for financial reporting purposes over
income tax purposes, reserves recorded for financial reporting purposes and
inventory capitalization for income tax purposes. Valuation allowances of $3.4
million and $1.1 million have been provided for at September 30, 1996 and 1995
respectively.

At September 30, 1996 and 1995 Mecklermedia UK had future United Kingdom income
tax benefits of approximately $566,000 and $528,000, for which valuation
allowances have been fully provided.

Inflation
---------

Management does not believe that inflation has a material impact on the
Company's results of operations. Management believes that it will be able to
increase prices to keep pace with inflationary increases in costs without a
significant decline in revenues.

                                       13
<PAGE>
 
ITEM 7. FINANCIAL STATEMENTS
----------------------------




                   INDEX TO CONSOLIDATED FINANCIAL STATEMENTS



<TABLE>
<CAPTION>
                                                                      Page
                                                                     ------

<S>                                                                  <C>
Report of Independent Public Accountants                                15
                                                            
Consolidated Balance Sheets - September 30, 1996 and 1995             16-17
                                                            
Consolidated Statements of Operations for the years ended   
   September 30, 1996 and 1995                                          18
                                                            
Consolidated Statements of Changes in Stockholders' Equity  
   for the years ended September 30, 1996 and 1995                      19
 
Consolidated Statements of Cash Flows for the years ended
   September 30, 1996 and 1995                                          20
 
Notes to Consolidated Financial Statements                            21-29
</TABLE>

                                       14
<PAGE>
 
                    REPORT OF INDEPENDENT PUBLIC ACCOUNTANTS





To the Board of Directors and Stockholders of Mecklermedia Corporation:

We have audited the accompanying consolidated balance sheets of Mecklermedia
Corporation (a Delaware corporation) and subsidiaries as of September 30, 1996
and 1995, and the related consolidated statements of operations, changes in
stockholders' equity and cash flows for the years then ended.  These financial
statements are the responsibility of the company's management.  Our
responsibility is to express an opinion on these financial statements based on
our audits.

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

In our opinion, the financial statements referred to above present fairly, in
all material respects, the financial position of Mecklermedia Corporation and
subsidiaries as of September 30, 1996 and 1995, and the results of their
operations and their cash flows for the years then ended in conformity with
generally accepted accounting principles.



                                                             ARTHUR ANDERSEN LLP


Stamford, Connecticut
November 15, 1996

                                       15
<PAGE>
 
PART I.   FINANCIAL INFORMATION
                                                  Item 1.   Financial Statements

                   MECKLERMEDIA CORPORATION AND SUBSIDIARIES
                   -----------------------------------------
                          CONSOLIDATED BALANCE SHEETS
                          ---------------------------
                          SEPTEMBER 30, 1996 AND 1995
                          ---------------------------
                                 (In thousands)
                                 --------------
<TABLE>
<CAPTION>
 
                                               1996         1995   
                                            ----------   ----------
<S>                                         <C>          <C>     
                   ASSETS                                            
CURRENT ASSETS:                                                    
     Cash and cash equivalents                $19,859      $19,442 
     Accounts receivable, less allowances       
          of $647 and $215, respectively        7,327        2,300 
     Current note receivable (Note 10)            213          200 
     Income taxes receivable                        6          132 
     Inventory (Note 2)                           511          666 
     Prepaid trade show expenses (Note 2)       2,265        1,572 
     Prepaid expenses and other (Note 2)          578          214 
                                            ----------   ----------
               Total current assets            30,759       24,526 
                                                                   
                                                                   
LONG-TERM NOTE RECEIVABLE, net of                                  
 amortized discount of $32 and $72,                                
 respectively (Note 10)                           205          377 
                                                                   
PREPAID TRADE SHOW EXPENSES (Note 2)                -          109 
                                                                   
DEFERRED PROMOTION COSTS, NET OF                                   
    ACCUMULATED AMORTIZATION (Note 2)             481          467 
                                                                   
OTHER ASSETS                                       33           28 
                                                                   
PROPERTY AND EQUIPMENT (Note 2):                                   
     Leasehold improvements                       297          236 
     Furniture, fixtures and equipment            517          304 
     Computer equipment                         1,497          801 
                                            ----------   ----------
                                                2,311        1,341 
                                                                   
     Less:  Accumulated depreciation                               
      and amortization                           (652)        (289)
                                            ----------   ----------
     Property and equipment, net                1,659        1,052 
                                                                   
INTANGIBLE ASSETS, net of accumulated                              
 amortization of $193 and $33,                                     
 respectively (Note 2)                          1,449          141 
                                            ----------   ----------
                                                                   
          Total assets                        $34,586      $26,700 
                                            ==========   ==========
</TABLE>

          The accompanying notes to consolidated financial statements
                 are an integral part of these balance sheets.

                                       16
<PAGE>
 
                   MECKLERMEDIA CORPORATION AND SUBSIDIARIES
                   -----------------------------------------
                          CONSOLIDATED BALANCE SHEETS
                          ---------------------------
                          SEPTEMBER 30, 1996 AND 1995
                          ---------------------------
               (In thousands, except share and per share amounts)
               --------------------------------------------------

<TABLE>
<CAPTION>
                                                     1996          1995      
                                                  ----------    ----------   
<S>                                                 <C>           <C>        
    LIABILITIES AND STOCKHOLDERS' EQUITY      
CURRENT LIABILITIES:                                                         
   Accounts payable                                  $2,876        $1,575    
   Accrued expenses                                   2,227         1,174    
   Current income taxes payable (Note 3)                 75            29    
   Deferred magazine revenue (Note 2)                 2,586         1,586    
   Deferred trade show revenue (Note 2)              12,138         3,835    
   Deferred book revenue                                 10           142    
                                                  ----------    ----------   
         Total current liabilities                   19,912         8,341    
                                                                             
DEFERRED MAGAZINE REVENUE - LONG-TERM (Note 2)          281           470    
                                                  ----------    ----------   
         Total liabilities                           20,193         8,811    
                                                                             
COMMITMENTS AND CONTINGENCIES (Note 4)                    -             -    
                                                                             
STOCKHOLDERS' EQUITY (Notes 6, 7 and 8):                                     
                                                                             
   Preferred stock ($.01 par value,                                        
      1,000,000 shares authorized,                        -             -    
      no shares issued and outstanding)      
   Common stock ($.01 par value,                                           
      35,000,000 and 9,000,000                                               
      shares authorized, 8,479,243                                       
      and 8,368,876 shares issued                        
      and outstanding at September                                       
      30, 1996 and September 30,                                        
      1995, respectively)                                85            84    
   Additional paid-in capital                        23,348        22,990    
   Accumulated deficit                               (9,050)       (5,182)   
   Foreign currency translation adjustment               10            (3)   
                                                  ----------    ----------
                                                                             
         Total stockholders' equity                  14,393        17,889    
                                                  ----------    ----------
                                                                             
         Total liabilities and stockholders' 
           equity                                   $34,586       $26,700   
                                                  =========     ========= 
</TABLE>



          The accompanying notes to consolidated financial statements
                 are an integral part of these balance sheets.

                                       17
<PAGE>
 
                   MECKLERMEDIA CORPORATION AND SUBSIDIARIES
                   -----------------------------------------
                     CONSOLIDATED STATEMENTS OF OPERATIONS
                     -------------------------------------
                FOR THE YEARS ENDED SEPTEMBER 30, 1996 AND 1995
                -----------------------------------------------

                    (In thousands, except per share amounts)
                    ----------------------------------------
<TABLE>
<CAPTION>
 
 
                                            1996       1995
                                         ---------   --------
REVENUES:
<S>                                       <C>        <C>
  Magazines and newspaper                 $ 15,511   $  8,096
  Trade shows                               12,717      5,277
  Other                                      2,366      1,114
                                         ---------   --------
                                            30,594     14,487
                                         ---------   --------
 
COST OF SALES AND DIRECT COSTS:
  Magazines and newspaper                    9,792      5,005
  Trade shows                                7,843      3,544
  Other                                        996        313
                                         ---------   --------
                                            18,631      8,862
                                         ---------   --------
 
Gross profit after cost of sales and        11,963      5,625
 direct costs
 
OPERATING EXPENSES:
  Advertising, promotion and selling         9,890      4,913
  General and administrative                 6,807      3,566
                                         ---------   -------- 
Operating loss                              (4,734)    (2,854)
                                         ---------   --------
 
  Interest income, net                       1,001        299
  Gain on sales of assets (Note 10)              -      1,325
                                         ---------   --------
 
Loss before income taxes                    (3,733)    (1,230)
Provision for income taxes (Notes 2 and        
 3)                                            135         45
                                         ---------   --------
 
Net loss                                   ($3,868)   ($1,275)
                                         =========   ========
 
Loss per share (Note 2)                     ($0.46)    ($0.17)
                                         =========   ========
 
Weighted average number of common            
 shares (Note 2)                             8,422      7,306
                                         =========   ========
</TABLE>
          The accompanying notes to consolidated financial statements
                   are an integral part of these statements.

                                       18
<PAGE>
 
                   MECKLERMEDIA CORPORATION AND SUBSIDIARIES
                   -----------------------------------------
           CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS' EQUITY
           ----------------------------------------------------------
                FOR THE YEARS ENDED SEPTEMBER 30, 1996 AND 1995
                -----------------------------------------------
                      (In thousands, except share amounts)
                      ------------------------------------
<TABLE>
<CAPTION>
 
 
                                                                                                          
                                                                                                                            
                                                Common Stock        Additional                  Foreign         Total       
                                         --------------------------   Paid-In    Accumulated    Currency      Stockholders' 
                                          Shares (a)     Amount       Capital      Deficit      Adjustment      Equity
                                        ------------  ------------- -----------  -----------    ----------   ------------
<S>                                       <C>         <C>           <C>          <C>           <C>           <C>
BALANCE, September 30, 1994               7,100,276            $71     $ 6,898       ($3,907)          ($3)        $ 3,059
 
Net loss                                          -              -           -        (1,275)            -          (1,275)
 
Common stock issued in public offering
 (Note 6)                                 1,000,000             10      15,205             -             -          15,215
 
Options exercised by directors and
 employees                                   88,600              1         273             -             -             274
 
Warrants exercised                          180,000              2         614             -             -             616
 
Foreign currency translation adjustment
                                                  -              -           -             -             -               -
                                        -----------   ------------  ----------   -----------    ----------   -------------
BALANCE, September 30, 1995               8,368,876             84      22,990        (5,182)           (3)         17,889
                                        -----------   ------------  ----------   -----------    ----------   -------------
 
Net loss                                          -              -           -        (3,868)            -          (3,868)
 
Options exercised by directors and
 employees                                   98,826              1         372             -             -             373
 
 
Shares tendered in lieu of cash
for exercise of options (Note 12)            (3,959)             -         (70)            -             -             (70)
 
Warrants exercised                           15,500              -          56             -             -              56
 
Foreign currency translation adjustment
                                                  -              -           -             -            13              13
                                        -----------   ------------  ----------   -----------    ----------   ------------- 
BALANCE, September 30, 1996               8,479,243            $85     $23,348       ($9,050)         $ 10         $14,393
                                        ===========   ============  ==========   ===========    ==========   =============
</TABLE>
     (a) All share amounts have been restated to retroactively reflect the two-
         for-one stock split which occurred on September 19, 1995 (see note 6).


       The accompanying notes to consolidated financial statements are an
                       integral part of these statements.

                                       19
<PAGE>
 
                   MECKLERMEDIA CORPORATION AND SUBSIDIARIES
                   -----------------------------------------
                     CONSOLIDATED STATEMENTS OF CASH FLOWS
                     -------------------------------------
                FOR THE YEARS ENDED SEPTEMBER 30, 1996 AND 1995
                -----------------------------------------------
                                 (In thousands)
                                 --------------
<TABLE>
<CAPTION>
 
                                                                                   1996                 1995
                                                                              ------------         ------------
CASH FLOWS FROM OPERATING ACTIVITIES:
<S>                                                                             <C>                  <C>
     Net loss                                                                      ($3,868)            ($1,275)
     Adjustments to reconcile net cash provided by (used in) operations-
       Depreciation and amortization                                                   555                 286
       Accretion of interest income on note receivable                                 (41)                (32)
       (Gain) on sales of assets, net                                                    -              (1,325)
     Changes in assets and liabilities-
       (Increase) in accounts receivable                                            (5,027)             (1,375)
       Decrease in other receivable                                                      -                 144
       Decrease in income taxes receivable                                             126                   4
       Decrease (increase) in inventory                                                155                (274)
       (Increase) in prepaid trade show expenses                                      (584)             (1,350)
       (Increase) in deferred promotion costs                                          (14)               (189)
       (Increase) decrease in prepaid expenses and other                              (369)                  4
       Increase in accounts payable and accrued expenses                             2,368                 724
       Increase in income taxes payable                                                 46                  29
       Increase in deferred magazine revenue                                           811               1,268
       Increase in deferred trade show revenue                                       8,303               3,568
       (Decrease) increase in deferred book revenue                                   (132)                142
                                                                              ------------         ------------
           Net cash provided by (used in) operating activities                       2,329                 349
                                                                              ------------         ------------
 
CASH FLOWS FROM INVESTING ACTIVITIES:
  Proceeds from notes receivable                                                      200                   25
  Proceeds from sales of assets                                                         -                  703
  Sales of short-term investments                                                   9,947                1,979
  Purchases of short-term investments                                              (9,947)                   -
  Additions to property and equipment                                                (970)                (686)
  Additions to intangibles                                                         (1,500)                (138)
                                                                              ------------         ------------
           Net cash provided by (used in) investing activities                     (2,270)               1,883
                                                                              ------------         ------------
CASH FLOWS FROM FINANCING ACTIVITIES:
  Proceeds from public offering, net of expenses and  
    underwriting discounts                                                              -               15,215
  Proceeds from exercise of options and warrants                                      359                  890
  Repayment of notes and loans, net                                                   (14)                 (16)
                                                                              ------------         ------------

           Net cash provided by (used in) financing activities                        345               16,089
                                                                              ------------         ------------
 
EFFECT OF EXCHANGE RATE CHANGES ON CASH                                                13                    -
                                                                              ------------         ------------
 
Net increase in cash and cash  equivalents                                            417               18,321
                                                                              ------------         ------------
 
CASH AND CASH EQUIVALENTS, beginning of period                                     19,442                1,121
                                                                              ------------         ------------
 
CASH AND CASH EQUIVALENTS, end of period                                          $19,859              $19,442
                                                                              ============         ============
 
SUPPLEMENTAL DISCLOSURES OF CASH FLOW:
  Cash paid for interest                                                               $1                   $1
  Cash paid for income taxes                                                          $88                  $29
</TABLE>
          The accompanying notes to consolidated financial statements
                   are an integral part of these statements.

                                       20
<PAGE>
 
                   MECKLERMEDIA CORPORATION AND SUBSIDIARIES
                   -----------------------------------------
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                   ------------------------------------------
                          SEPTEMBER 30, 1996 AND 1995
                          ---------------------------
                                        
(1)  The Company:
     ----------- 

The Company is a leading provider of information about the Internet through its
(i) publication of INTERNET WORLD, a monthly general circulation magazine, (ii)
publication of WEB WEEK, a biweekly business-to-business controlled circulation
newspaper, (iii) publication of WEB DEVELOPER, a bimonthly general circulation
magazine for technical, hands-on Internet professionals, (iv) INTERNET WORLD
trade shows and conferences, and (v) iWORLD, the Company's electronic daily
newspaper for Internet news and resources located on the World-Wide Web.  Since
all of the Company's products and services relate to providing Internet
information to business and information technology professionals, and consumers,
the Company's success is dependent on the continued growth of the Internet.

(2)  Summary of Significant Accounting Policies:
     ------------------------------------------ 

     Principles of consolidation-
     --------------------------- 

The consolidated financial statements include the accounts of the Company and
its wholly-owned foreign subsidiary, Mecklermedia Limited ("Mecklermedia UK"), a
United Kingdom corporation which began operations on July 1, 1987, and its
wholly-owned subsidiary, iWORLD Corporation, which was incorporated on May 17,
1994. All significant intercompany transactions have been eliminated.
Investments in affiliated international trade shows are accounted for using the
equity method. The Company's investment interests in these affiliated
international shows ranges from 25% to 45%.

     Revenue recognition-
     ------------------- 

          Trade show revenue-
          ------------------ 

                   Proceeds from the sale of trade show space and prepaid
                   admission fees are deferred and recognized as revenue at the
                   time the trade shows are held. Included in accounts
                   receivable are advanced billings on trade shows of
                   approximately $4.7 million and $1.0 million as of September
                   30, 1996 and 1995, respectively.

          Magazine and journal revenues-
          ----------------------------- 

                   Subscription revenues-
                   --------------------- 

                   Proceeds from subscriptions are recorded when received and
                   are included in revenue over the terms of the subscriptions,
                   generally one to two years, upon commencement of subscription
                   services. Subscriptions expiring within one year are included
                   as a current liability and the portion of the subscriptions
                   in excess of one year are classified as a non-current
                   liability under the caption deferred magazine revenue.

                   Newsstand revenue-
                   ----------------- 

                   Sales to newsstand distributors are recognized as revenue in
                   the month of distribution utilizing historical experience to
                   estimate the ultimate sales of magazines to the newsstand. In
                   the event that actual sales differ from estimates,
                   adjustments would be made in subsequent months. Historically,
                   these adjustments have not been material.

                   Magazine advertising revenue-
                   ---------------------------- 

                   Revenue from the sales of advertising space in magazines and
                   newspaper is recognized at the time the issue is circulated.

                                       21
<PAGE>
 
          Other revenues-
          -------------- 

                   Revenue from list rentals is recognized at the time of use by
                   the renter. Revenue from the sales of advertising space in
                   the Company's iWORLD Web site is recognized at the end of
                   each display period, which typically does not exceed one
                   month. Revenue from the sales of books and directories is
                   recognized upon shipment.

Use of estimates-
---------------- 

The preparation of financial statements in conformity with generally accepted
accounting principles requires management to make estimates and assumptions that
affect the reported amounts of assets and liabilities and the reported amounts
of revenues and expenses during the reporting period. Actual results could
differ from those estimates.

Foreign currency translation-
---------------------------- 

Assets and liabilities of the Company's foreign subsidiary are translated into
U.S. dollars using the exchange rate in effect at the balance sheet date.
Results of operations are translated using the average exchange rate prevailing
throughout the period. The effects of exchange rate fluctuations on translating
foreign currency assets and liabilities into U.S. dollars are included as part
of the foreign currency translation adjustment component of stockholders'
equity, while gains and losses resulting from foreign currency transactions are
included in net income (loss).

Cash and cash equivalents-
------------------------- 

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

Inventory-
--------- 

Inventory is stated at the lower of cost (first-in, first-out) or market.
Components of inventory are as follows as of September 30, 1996 and 1995 (in
thousands):

<TABLE>
<CAPTION>
 
                              1996             1995
                              ----             ----
          <S>                <C>              <C>
 
          Finished goods      $ 74             $139
          Work-in-process      437              527
                              ----             ----
                              $511             $666
                              ====             ====
</TABLE>

Publication costs of magazines, newspaper and books, including editorial,
typesetting and printing costs are included in work-in-process until the issue
or volume is released for sale, at which time the related costs are charged to
operations.

Prepaid trade show expenses-
--------------------------- 

Prepaid trade show expenses consist of deposits on trade show facilities,
advertising and promotion and related direct labor costs. These costs are
expensed at the time the trade show is held.

Prepaid expenses and other-
-------------------------- 

Prepaid expenses and other consist principally of refundable deposits, royalty
advances and other prepaid items. Royalty payments to authors for books not yet
published are treated as advances until the royalties are earned, at which time
they are charged to operations.

Deferred promotion costs-
------------------------ 

The Company defers promotion costs, which are primarily printing, list rental
and mailing costs, on most direct mail promotions for its general circulation
magazines in accordance with AICPA Statement of Position 93-7. These costs,
which are deferred to the extent of additional subscription revenues less
incremental fulfillment costs, are amortized over the periods of the
subscriptions generated from these promotions not to exceed one year. At
September 30, 1996 and 1995,

                                       22
<PAGE>
 
approximately $481,000 and $467,000, respectively, of promotion costs were
deferred as assets. All other advertising and promotion expenses except these
direct mail promotions are expensed at the time the advertising takes place.
Total advertising, promotion and selling expense for the years ended September
30, 1996 and 1995, was approximately $9.8 million and $4.9 million,
respectively, which included $113,000 and $96,000 for deferred amounts written
down to net realizable value.

Property and equipment-
---------------------- 

Property and equipment are stated at cost. The Company records depreciation,
using the straight-line method, in amounts sufficient to write-off the cost of
depreciable assets over the following estimated useful lives:

       Leasehold improvements                Estimated useful lives or lease
                                             term, whichever is shorter
       Furniture, fixtures and equipment             3-10 years
       Vehicles                                      5 years
       Computer equipment                            5 years

Depreciation expense amounted to $363,000 and $246,000 for the years ended
September 30, 1996 and 1995, respectively.

Maintenance and repair expenditures are charged to appropriate expense accounts
in the period incurred; replacements, renewals and betterments are capitalized.
Upon sale or other disposition of property, the cost and accumulated
depreciation of such properties are eliminated from the accounts and the gains
or losses thereon are reflected in operations.

Intangible assets-
----------------- 

Intangible assets are stated at cost and consist of the following as of
September 30, 1996 and 1995 (in thousands):
<TABLE>
<CAPTION>
 
 
                                     1996     1995
                                    -------  ------
    <S>                             <C>      <C>
    Acquisition costs (a)             $998    $108
    Trademarks and copyrights          644      34
    Database costs                       -      32
                                    ------   -----
                                     1,642     174
    Less: Accumulated amortization    (193)    (33)
                                    ------   -----
 
    Intangible assets, net          $1,449    $141
                                    ------   -----
</TABLE>
     (a)  Acquisition costs pertain to publishing rights, sponsorship rights and
          subscription lists, which the Company has acquired for various
          magazines and trade shows. Acquisition costs also pertain to Web site
          acquisitions.

Intangible assets are being amortized using the straight-line method over the
estimated useful lives of three to five years.

Amortization expense amounted to $192,000 and $41,000 for the years ended
September 30, 1996 and 1995, respectively.

General promotion costs-
----------------------- 

Costs incurred in connection with the general procurement of subscriptions,
other than direct mail promotions capitalized, and the general promotion of new
projects are expensed in the year incurred.

Income taxes-
------------ 

The Company follows Statement of Financial Accounting Standards No. 109,
"Accounting for Income Taxes" ("SFAS No. 109") for the calculation of its income
tax expense and related liabilities.

                                       23
<PAGE>
 
Loss per share-
-------------- 

The weighted average number of common shares outstanding as presented have been
adjusted for the two-for-one stock split which occurred on September 19, 1995
(see note 6). Common stock equivalents have not been included as these are
antidilutive.

Presentation-
------------ 

Certain amounts have been reclassified in the prior year statements to conform
to the current year presentation.

Other-
----- 

The Company does not believe any recently issued accounting standards will have
a material impact on its financial condition or results of operations.

(3)   Income Taxes:
      ------------ 

Loss before income taxes consists of the following (in thousands):

<TABLE>
<CAPTION>
                                 Year Ended        Year Ended   
                                September 30,     September 30, 
                                    1996              1995      
                               ---------------   ---------------
                                                                
       <S>                      <C>               <C>           
        Domestic                  ($4,113)          ($  786)    
        Foreign                       380              (444)    
                                  -------           -------     
                                  ($3,733)          ($1,230)    
                                  =======           =======      
</TABLE>

The provision for income taxes consists of the following (in thousands):

<TABLE>
<CAPTION>
 
                                 Year Ended        Year Ended  
                                September 30,     September 30,
                                    1996              1995     
                               ---------------   ---------------
       <S>                     <C>               <C>            
        Current provision
              Federal                 $ -               $ -
              State                    64                45
              Foreign                  71                 -
                                    -----             -----
                                      135                45
        Deferred provision                                
              Federal                   -                 -
              State                     -                 -
              Foreign                   -                 -
                                    -----             -----
                                     $135               $45
                                    =====             =====
</TABLE>

                                       24
<PAGE>
 
At September 30, 1996 and 1995, the Company had future U.S. federal and state
income tax benefits of approximately $3.4 million and $1.1 million as follows
(in thousands):

<TABLE>
<CAPTION>
                                               1996             1995  
                                            -----------      -----------
<S>                                         <C>              <C>   
    Net operating losses                       $2,897           $  790 
    Excess of amortization of intangibles                             
      for financial reporting purposes                                
      over income taxes                            28               78
    Reserves recorded for financial                                   
      reporting purposes                          377              141
    Inventory capitalization                                          
      for income tax purposes                      95              113
                                               ------           ------
    Total future federal and state income                             
      tax benefits                              3,397            1,122
    Less valuation allowances                  (3,397)          (1,122)
                                               ------           ------
    Deferred income tax asset                  $    -           $    -
                                               ======           ====== 
</TABLE>

At September 30, 1996,  the Company had available net operating loss ("NOL")
carryforwards for U.S. federal income tax purposes of approximately $6.8 million
which will expire from 2009 to 2011.  These NOL's include approximately $2.1
million related to disqualifying incentive stock option dispositions which will
be charged against additional paid in capital when realized.

At September 30, 1996 and 1995, Mecklermedia UK had future United Kingdom income
tax benefits of approximately $566,000 and $528,000, for which valuation
allowances have been fully provided.

A reconciliation setting forth the difference between the effective income tax
rate of the Company and the U.S. Federal statutory income tax rate is as follows
(in thousands):
<TABLE>
<CAPTION>
                                                    Year Ended      Year Ended
                                                   September 30,   September 30,
                                                       1996            1995
                                                   -------------   -------------
<S>                                                <C>             <C>
    Federal statutory rate                             ($1,269)          ($418)
    Foreign losses without income tax benefits              44             151
    Domestic losses without income tax benefits          1,200             260
    State income taxes                                      64              45
    Foreign income taxes                                    71               -
    Provision for non-deductible expenses                   25               7
                                                        ------           -----
                                                        $  135           $  45
                                                        ======           =====
</TABLE>
 
(4)  Commitments and Contingencies:
     ----------------------------- 

The following is a schedule of approximate annual future minimum rental payments
required under operating leases that have initial or remaining noncancelable
lease terms in excess of one year as of September 30, 1996 (in thousands):
<TABLE>
<CAPTION>
 
                        Fiscal               
                        Year                 
                        ----                 
                        <S>           <C>    
                        1997          $   365
                        1998              369
                        1999              371
                        2000              181
                        2001               74
                        Thereafter          -
                                      -------
                             Total    $ 1,360
                                      ======= 
</TABLE>

                                       25
<PAGE>
 
For the years ended September 30, 1996, and September 30, 1995, the total rent
expense incurred by the Company was approximately $235,000 and $122,000,
respectively.

The Company has employment agreements with four key employees with terms ranging
from six months to one year.

The Company is subject to legal proceedings and claims which arise in the
ordinary course of its business. In the opinion of management, the amount of
ultimate liability with respect to these actions will not materially affect the
financial position of the Company.

(5)  Transactions with Related Parties:
     --------------------------------- 
 
A director of the Company is a principal in a law firm which provides counsel to
the Company.  The Company incurred expenses of approximately $74,000 and
$110,000 related to services provided by this law firm for the years ended
September 30, 1996 and 1995, respectively.

(6)  Common Stock:
     ------------ 

On March 13, 1996, the Company's stockholders approved an increase in the number
of authorized shares of common stock from 9,000,000 to 35,000,000.

The Company's Board of Directors approved a two-for-one split of the Company's
common stock in the form of a 100% stock dividend payable on September 19, 1995.
A total of 4,184,438 shares of common stock were issued in connection with the
split. All share and per share amounts have been restated to retroactively
reflect the stock split.

On August 10, 1995, the Company completed a public offering of 1,000,000 shares
of common stock. The shares were sold to the underwriters at a price of $16.75
before underwriters' discount. The Company realized net proceeds, after expenses
and underwriters' discount, of approximately $15.2 million from the offering.

In fiscal 1996 and 1995, warrants to purchase 15,500 and 180,000 shares of
common stock, respectively, for $3.60 per share were exercised. The Company
realized net proceeds, after expenses, of approximately $56,000 and $616,000,
respectively. As of September 30, 1996, the Company had warrants outstanding to
purchase 4,500 shares of common stock exercisable at a price of $3.60 per share.

(7)  Stock Option Plans:
     ------------------ 

In December 1993, the Company established a stock option plan. The Company may
issue options to key employees, including officers, up to an aggregate of
400,000 shares of common stock. The purchase price of the common stock under
each option will be at least 100% of the fair market value of the shares on the
date of grant. The plan will terminate on December 1, 2003.

In January 1995, the Company established a second stock option plan. The Company
may issue options to key employees, including officers, up to an aggregate of
400,000 shares of common stock. The purchase price of the common stock under
each option will be at least 100% of the fair market value of the shares on the
date of the grant. The plan will terminate on January 31, 2005.

The following is a summary of stock option activity for both plans (in
thousands, except per share amounts):
<TABLE>
<CAPTION>
 
                                                       1993           1995   
                                                       Plan           Plan   
                                                     --------       -------- 
                                                                             
<S>                                                  <C>            <C>   
    Options Outstanding at September 30, 1995            299            156  
    Granted                                                -            260  
    Cancelled                                            (26)           (69) 
    Exercised ($2.89 to $11.13 per share)                (77)           (22) 
                                                         ---            ---  
    Options Outstanding at September 30, 1996                                
              ($2.89 to $21.75 per share)                196            325  
                                                         ===            ===  
    Options Exercisable at September 30, 1996            108             83  
                                                         ===            ===   
</TABLE>

                                       26
<PAGE>
 
(8)    Preferred Stock:
       --------------- 

In December 1993, the Company authorized the issuance of 1,000,000 shares of
preferred stock, $.01 par value (the "Preferred Stock").

The Board of Directors has the authority, without further vote or action by the
stockholders, to issue the undesignated shares of Preferred Stock in one or more
series and to fix all rights, qualifications, preferences, limitations and
restrictions of each series, including dividend rights, voting rights, terms of
redemption, redemption prices, liquidation preferences and the number of shares
constituting any series or the designation of such series.

(9)    Employee Benefit Plan:
       --------------------- 

The Company has a contributory plan which qualifies under Section 401(k) of the
Internal Revenue Code for employees meeting certain service requirements. The
plan allows eligible employees to contribute up to 15% of their compensation to
the plan. At the discretion of the Board of Directors, the Company may also make
contributions dependent on profits each year for the benefit of all eligible
employees under the plan. There were no discretionary contributions for the
years ended September 30, 1996 and 1995.

(10)   Sales of Assets:
       --------------- 

On November 11, 1994, the Company sold CD ROM World to PC World for $110,000
cash and assumption of the deferred subscription liabilities of approximately
$260,000. In addition, the Company received proceeds in the form of advertising
space and subscription list usage, and an option exercisable by either the
Company or PC World during certain specified periods commencing in September
1997 and ending in January 2001, which requires PC World to pay the Company an
amount equal to 40% of the pretax income, for the year for which the option is
exercised, of PC World's Multimedia World magazine or any successor publication,
less $110,000 (the "Option Amount"). The January 1995 issue of CD ROM World was
the last issue the Company published. In connection with this sale, the Company
has agreed, for a period ending two years after the payment of the Option
Amount, not to publish, market or distribute any subscription publication of
which the principal subject matter is computer multimedia. The Company
recognized a gain of $241,000 on the sale based on the cash proceeds and
deferred subscription liability assumed by PC World. No value has been ascribed
to the advertising space and subscription list usage and income, if any, from
the Option Amount will be recorded when received. CD ROM World's revenues, costs
of sales and direct costs, and advertising and promotion expenses were
approximately $925,000, $486,000 and $225,000, respectively, for fiscal 1995.

On January 31, 1995, the Company sold the publishing rights to a directory known
as the OPAC Directory to Learned Information, Inc. for $8,000 and a short-term
note receivable of $8,000. The Company recognized a gain of $7,000 on the sale
for the year ended September 30, 1995.

On February 8, 1995, the Company sold its journal INTERNET RESEARCH to MCB
University Press for $100,000 and the assumption of INTERNET RESEARCH's deferred
subscription liabilities of approximately $33,000. The Company recognized a gain
of $133,000 on the sale for the year ended September 30, 1995.

On February 16, 1995, the Company sold its magazine COMPUTERS IN LIBRARIES and
rights to its trade show of the same name to Learned Information, Inc. for
$200,000, a non-interest bearing note receivable of $675,000 to be collected
over three years and the assumption of COMPUTERS IN LIBRARIES' deferred
subscription liabilities of approximately $180,000. The non-interest bearing
note receivable has been discounted at 9.0%. The Company recognized a gain of
$950,000 on the sale for the year ended September 30, 1995. COMPUTERS IN
LIBRARIES magazine and trade show had revenues, costs of sales and direct costs,
and advertising and promotion expenses of approximately $540,000, $351,000 and
$46,000, respectively, for fiscal 1995.

On May 18, 1995, the Company sold its publishing rights to CD ROMS IN PRINT to
Gale Research, a division of Thomson Information, Inc. for $278,000. The Company
recognized no material gain or loss on the sale for the year ended September 30,
1995.

On June 26, 1995, the Company sold its magazine VR WORLD to Miller Freeman, Inc.
in exchange for Miller Freeman, Inc. assuming the VR WORLD deferred subscription
liabilities of approximately $53,000. The Company recognized a gain of $11,000
on the sale for the year ended September 30, 1995.

                                       27
<PAGE>
 
(11)   Business Segments and Geographic Information:
       -------------------------------------------- 

Information with respect to the revenues, operating income (loss), identifiable
assets, additions to property and equipment and intangibles, and depreciation
and amortization of the Company's principal business segments is as follows (in
thousands):
<TABLE>
<CAPTION>
 
                                            Year Ended            Year Ended
                                          September 30,          September 30, 
                                               1996                  1995     
                                        ----------------         -------------- 
     <S>                                <C>                      <C>            
     REVENUES:                                                                  
          Magazines and newspaper (a)         $15,511                $ 8,096    
          Trade shows                          12,717                  5,277    
          Other                                 2,366                  1,114    
                                              -------                -------    
                                              $30,594                $14,487    
                                              =======                =======    
                                                                                
     OPERATING INCOME (LOSS):                                                   
          Magazines and newspaper            ($ 7,472)              ($ 2,968)  
          Trade shows                           2,555                    230    
          Other                                   183                   (116)  
                                              -------                -------    
                                             ($ 4,734)              ($ 2,854)  
                                              =======                =======    
                                                                                
     IDENTIFIABLE ASSETS:                                                       
          Magazines and newspaper             $ 3,698                $ 2,101    
          Trade shows                           7,807                  2,731    
          Other                                 1,190                    541    
          Cash and other - unallocated         21,891                 21,327    
                                              -------                -------    
                                              $34,586                $26,700    
                                              =======                =======    
                                                                                
     ADDITIONS TO PROPERTY AND                                                  
     EQUIPMENT AND INTANGIBLE ASSETS:                                           
          Magazines and newspaper             $   419                $    -     
          Trade shows                             729                     84    
          Other                                   347                    107    
          Corporate - unallocated                 975                    633    
                                              -------                -------    
                                              $ 2,470                $   824    
                                              =======                =======    
                                                                                
     DEPRECIATION AND AMORTIZATION:                                             
          Magazines and newspaper             $    43                $    -     
          Trade shows                              41                      6    
          Other                                    42                     36    
          Corporate - unallocated                 429                    244    
                                              -------                -------    
                                              $   555                $   286    
                                              =======                =======   
</TABLE>

                                       28
<PAGE>
 
Significant financial information by geographic area is as follows (in
thousands):
<TABLE>
<CAPTION>
 
                             Year Ended          Year Ended    
                            September 30,       September 30,   
                                1996                1995       
                           --------------      --------------
<S>                          <C>                  <C>             
REVENUES:                                                            
    United States (b)         $ 30,003            $ 14,090           
    Europe                         432                 397           
    Other                          159                   -           
                              --------            --------           
                              $ 30,594            $ 14,487           
                              ========            ========           
NET LOSS:                                                            
    United States (b)          ($3,310)              ($831)          
    Europe                        (130)               (444)          
    Other                         (428)                  -           
                              --------            --------           
                               ($3,868)            ($1,275)          
                              ========            ========           
IDENTIFIABLE ASSETS:                                                 
    United States (b)         $ 33,736            $ 26,582           
    Europe                         850                 118           
    Other                            -                   -           
                              --------            --------           
                              $ 34,586            $ 26,700           
                              ========            ========            
</TABLE>



       (a) Magazines and newspaper revenues consist of the following (in
thousands):
<TABLE>
<CAPTION>
 
                                    Year Ended     Year Ended
                                   September 30,  September 30,
                                       1996           1995
                                   -------------  -------------
<S>                                <C>            <C>
 
          Advertising revenues        $ 9,413        $ 3,257   
          Circulation revenues          5,908          4,605   
          All other                       190            234   
                                      -------        -------   
          Total magazines and                                  
             newspaper revenues       $15,511        $ 8,096   
                                      =======        =======   
</TABLE>
          All magazines and newspaper costs of sales and direct costs relate to
          circulation revenues. The Company does not incur any incremental costs
          of sales and direct costs with respect to advertising revenues.

       (b)  Includes United States and Canada

(12)   Supplemental Disclosure of Noncash Investing and Financing Activities:
       --------------------------------------------------------------------- 

Year ended September 30, 1996

A former employee tendered 3,959 shares of common stock with a fair value of
approximately $70,000 in lieu of cash for the exercise of stock options.

Year ended September 30, 1995

In connection with the sales of assets described in Note 10, the buyers assumed
aggregate deferred subscription liabilities of approximately $521,000 from
Company during the year ended September 30, 1995. In addition, the Company
received notes receivable of $650,000 in connection with certain of these sales.

                                       29
<PAGE>
 
ITEM 8. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND
-----------------------------------------------------------------------
FINANCIAL DISCLOSURE
--------------------

     None.

PART III
--------

ITEM 9. DIRECTORS, EXECUTIVE OFFICERS, PROMOTERS AND CONTROL PERSONS; COMPLIANCE
--------------------------------------------------------------------------------
WITH SECTION 16 (a) OF THE EXCHANGE ACT
---------------------------------------

The Directors and Executive Officers of the Company are as follows:

    Name              Age  Position with the Company
    ----              ---  -------------------------


Alan M. Meckler         51  Chairman of the Board; Chief Executive Officer; 
                            President; Director                    
Christopher S. Cardell  37  Executive Vice President, Chief Operating Officer 
                            and Chief Financial Officer             
Carl S. Pugh            42  President, Chief Operating Officer of the       
                            Trade Show Group                                
Wayne A. Martino        37  Director                                        
Michael J. Davies       51  Director                                        
Walter H. Lippencott    57  Director                                        


Alan M. Meckler has been Chairman of the Board and Chief Executive Officer of
the Company since December 1993 and has been President and a director of the
Company and Publisher of each of the Company's publications since 1971. Mr.
Meckler has also held the office of Chairman of the Board of the Company during
certain periods since 1971, and is the only person to have held the offices of
Chairman of the Board, Chief Executive Officer or President since the Company's
founding.

Christopher S. Cardell has been Executive Vice President, Chief Operating
Officer and Chief Financial Officer of the Company since November 1996. Prior to
November 1996, Mr. Cardell held the office of Executive Vice President and Chief
Financial Officer. He joined the company as Senior Vice President and Chief
Financial Officer on January 2, 1996. Prior to that time, Mr. Cardell was a
Senior Manager with Arthur Andersen LLP.

Carl S. Pugh has been President, Chief Operating Officer of the Company's Trade
Show Group since October 1995. For the four years before joining the Company Mr.
Pugh was President of Cowles Event Management, a division of Cowles Business
Media. Between 1985 and 1990, Mr. Pugh was with the Conference Management
Corporation serving as Chief Executive Officer for the last three years.

Wayne A. Martino has been a director of the Company since December 1993. Mr.
Martino is a member of the bar in the State of Connecticut and has been a
principal at the law firm of Brenner, Saltzman & Wallman (formerly Brenner,
Saltzman, Wallman & Goldman) since 1991. Mr. Martino served as an associate of
that firm until he assumed his present position.

Michael J. Davies has been a director of the Company since January 1996. Mr.
Davies has been the Managing Director, Corporate Finance, of the investment bank
Legg Mason Wood Walker, Incorporated ("Legg Mason") since 1993. Before joining
Legg Mason, Mr. Davies was the Publisher of the newspaper, the Baltimore Sun,
between 1990 and 1993.

Walter H. Lippincott has been a director of the Company since January 1996.  Mr.
Lippincott has been the Director and Chief Executive Officer of the Princeton
University Press, a non-profit publisher of scholarly books for the last nine
years.

All directors hold office until the next annual meeting of stockholders of the
Company or until their successors have been elected. However, any director may
be removed from office, with or without cause, by the affirmative vote of a
majority of the combined voting power of the then outstanding shares of stock of
all classes and series entitled to vote thereon. Any director may also be
removed from office with cause by the affirmative vote of a majority of the
members of the board of directors other than the director who is subject to such
vote.

The Company's Board of Directors has established a Compensation Committee, a
Stock Option Committee and an Audit Committee. The Compensation Committee
establishes salaries, incentives and other forms of compensation, administers
the Company's benefit plans and recommends policies relating to such plans. The

                                       30
<PAGE>

Stock Option Committee administers the Company's 1993 Stock Option Plan and the
1995 Stock Option Plan. The Audit Committee reviews the Company's accounting
practices, internal accounting controls and financial results and oversees the
engagement of the Company's independent auditors.

ITEM 10. EXECUTIVE COMPENSATION
-------------------------------

Incorporated by reference herein from the Registrant's Proxy Statement for its
Annual Meeting of Stockholders to be held in 1997.

ITEM 11. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
------------------------------------------------------------------------

Incorporated by reference herein from the Registrant's Proxy Statement for its
Annual Meeting of Stockholders to be held in 1997.

ITEM 12. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
-------------------------------------------------------

Incorporated by reference herein from the Registrant's Proxy Statement for its
Annual Meeting of Stockholders to be held in 1997.

ITEM 13. EXHIBITS AND REPORTS ON FORM 8-K
-----------------------------------------

a. Exhibits
-----------

3.1    Certificate of Incorporation, filed with the Secretary of State of the
       State of Delaware on December 10, 1993 and incorporated herein by
       reference to Exhibit 3.1 to the Registration Statement on Form SB-2 (No.
       33-73172-NY) of the Registrant, filed with the SEC on December 17, 1993.

3.2    By-Laws of the Registrant incorporated herein by reference to Exhibit 3.2
       to the Registration Statement on Form SB-2 (No. 33-73172-NY) of the
       Registrant, filed with the SEC on December 17, 1993.

4.1    Specimen Common Stock Certificate incorporated herein by reference to
       Exhibit 4.1 to Amendment No. 3 to the Registration Statement on Form SB-2
       (No. 33-73172-NY) of the Registrant, filed with the SEC on February 3,
       1994.

4.2    Form of Representatives' Warrant to purchase shares of Common Stock of
       Mecklermedia Corporation incorporated herein by reference to Exhibit 4.2
       to the Registration Statement on Form SB-2 (No. 33-73172-NY) of the
       Registrant, filed with the SEC on December 17, 1993.

10.1   Distribution Contract, dated January 5, 1993, by and between the Company
       and Kable News Company, Inc., as amended by letters dated July 1, 1993,
       July 7, 1993 and December 14, 1993, respectively, and incorporated herein
       by reference to Exhibit 10.2 to the Registration Statement on Form SB-2
       (No. 33-73172-NY) of the Registrant, filed with the SEC on December 17,
       1993.

10.2   Letter Agreement, dated March 26, 1993, between the Registrant and
       International Periodical Distributors, as amended by letters dated August
       31, 1993, September 20, 1993 and February 1, 1994, respectively, and
       incorporated herein by reference to Exhibit 10.3 to Amendment No. 1 to
       the Registration Statement on Form SB-2 (No. 33-73172-NY) of the
       Registrant, filed with the SEC on January 20, 1994.

10.3   Common Stock Purchase and Shareholder's Agreement, dated as of August 2,
       1993, by and among Meckler Corporation, James S. Mulholland, Jr., James
       S. Mulholland III and Alan M. Meckler, as amended by the First Amendment
       to Common Stock Purchase and Shareholders' Agreement, dated as of
       December 14, 1993, by and among Meckler Corporation, James S. Mulholland,
       Jr., James S. Mulholland III (individually and as Custodian) and Alan M.
       Meckler (individually and as Trustee), Alan B. Abramson, as Trustee, and
       Marie Mulholland Flatness and incorporated herein by reference to Exhibit
       10.10 to the Registration Statement on Form SB-2 (No. 33-73172-NY) of the
       Registrant, filed with the SEC on December 17, 1993.

10.4   Mecklermedia Corporation 1993 Stock Option Plan incorporated herein by
       reference to Exhibit 10.11 to the Registration Statement on Form SB-2
       (No. 33-73172-NY) of the Registrant, filed with the SEC on December 17,
       1993.

                                       31
<PAGE>
 
10.5   Lease, dated as of June 9, 1994, among John Guinta, Mary Guinta, John J.
       Guinta, Jr. and Robert J. Guinta and the Registrant, filed with the SEC
       on December 29, 1994.

10.6   Lease, dated November 4, 1992, between Seal Limited and Meckler Limited
       and incorporated herein by reference to Exhibit 10.13 to Amendment No. 1
       to the Registration Statement on Form SB-2 (No. 33-73172-NY) of the
       Registrant, filed with the SEC on January 20, 1994.

10.7   Form of Author's Agreement incorporated herein by reference to Exhibit
       10.17 to Amendment No. 2 to the Registration Statement on Form SB-2 (No.
       33-73172-NY) of the Registrant, filed with the SEC on February 3, 1994.

10.8   Publisher/Representative Agreements, each dated January 12, 1994, between
       Kamikow & Company, Inc. and the Registrant and incorporated herein by
       reference to Exhibit 10.18 to Amendment No. 2 to the Registration
       Statement on Form SB-2 (No. 33-73172-NY) of the Registrant, filed with
       the SEC on February 3, 1994.

10.9   Purchase and Sale Agreement, dated as of November 11, 1994, by and
       between PC World Communications, Inc. and the Registrant filed with the
       SEC on December 29, 1994.

10.10  Agreement, dated October 13, 1994, between Mecklermedia Limited, Learned
       Information (Europe) Limited, the Registrant and Disclosure Limited filed
       with the SEC on December 29, 1994.

10.11  Amendment, dated as of April 26, 1995, to lease dated June 9, 1994, among
       John Guinta, Mary Guinta, John J. Guinta, Jr. and Robert J. Guinta and
       the Registrant for premises located at 20 Ketchum Street, Westport,
       Connecticut 06880, filed with the SEC on December 18, 1995.

10.12  Purchase Agreement, dated February 16, 1995, between Learned Information,
       Inc. and the Registrant and incorporated herein by reference to Form 8-K
       of the Registrant filed with the SEC on February 22, 1995.

10.13  Lease, dated August 1, 1995, between SeaBreeze I Venture and the
       Registrant for premises located at 111 Anza Boulevard, Burlingame,
       California 94010, filed with the SEC on December 18, 1995.

10.14  Lease, dated September 1, 1995, between Phyllis Jackson, Executrix of the
       Estate of Karl F. Jackson, Jr. and the Registrant for premises located at
       170 Worcester Street, Wellesley, Massachusetts 02181, filed with the SEC
       on December 18, 1995.

10.15  Lease, dated September 29, 1995 between John Guinta, Mary Guinta, John J.
       Guinta, Jr. and Robert J. Guinta and the Registrant for premises located
       at 20 Ketchum Street, Westport, Connecticut 06880, filed with the SEC on
       December 18, 1995.

10.16  Mecklermedia Corporation 1995 Stock Option Plan, filed with the SEC on
       December 18, 1995.

*11.   Statement regarding computation of per share earnings.

*21.   Subsidiaries of the Registrant.

*23.   Consent of Arthur Andersen LLP.

*27    Financial Data Schedule.
 
--------------
* Filed herewith

b. Reports on Form 8-K
----------------------

None

                                       32
<PAGE>
 
SIGNATURES

      In accordance with Section 13 or 15 (d) of the Securities Exchange Act of
1934, the Registrant caused this report to be signed on its behalf by the
undersigned, thereunto duly authorized on December 6, 1996.


                        MECKLERMEDIA CORPORATION



                        By: /s/ Alan M. Meckler
                            -------------------
                            Alan M. Meckler,
                            Chairman of the Board, President
                            and Chief Executive Officer


      In accordance with the Securities Exchange Act of 1934, this report has
been signed below by the following persons on behalf of the Registrant and in
the capacities and on the dates indicated.


     Signature                            Title                       Date

 /s/ Alan M. Meckler          Director, Chairman of the         December 6, 1996
 -------------------          Board, President and Chief     
     Alan M. Meckler          Executive Officer
                              (Principal Executive Officer)



 /s/ Christopher S. Cardell   Executive Vice President, Chief   December 6, 1996
 --------------------------   Operating Officer and Chief       
     Christopher S. Cardell   Financial Officer



 /s/ Wayne A. Martino         Director                          December 6, 1996
 --------------------                                
     Wayne A. Martino



 /s/ Michael J. Davies        Director                          December 6, 1996
 ---------------------                                
     Michael J. Davies



 /s/ Walter H. Lippincott     Director                          December 6, 1996
 ------------------------                                
     Walter H. Lippincott

                                       33
<PAGE>
 
INDEX TO EXHIBITS


Exhibit No.                   Description

11.      Statement regarding computation of per share earnings.

21.      Subsidiaries of the Registrant.

23.      Consent of Arthur Andersen LLP.

27.      Financial Data Schedule.

                                      34