SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549
                                  FORM 10-KSBA
(Mark one)
[X]      Annual report under section 13 or 15(d) of the Securities  Exchange Act
         of 1934 for the fiscal year ended December 31, 1996.
[        ]  Transition  report  under  section  13 or  15(d)  of the  Securities
         Exchange Act of 1934 for the  transition  period from  ____________  to
         _____________.

Commission file number                                                 000-21143

                      WIRELESS CABLE & COMMUNICATIONS, INC.
                 (Name of small business issuer in its charter)

      Nevada                                                          87-0545056
(State or other jurisdiction of                                 (I.R.S. Employer
incorporation or organization)                               Identification No.)

102 West 500 South, Suite 320                                              84101
Salt Lake City, Utah
(Address of principal executive office)                               (Zip Code)

(Issuer's telephone number) (801) 328-5618

Securities to be registered under Section 12(b) of the Act:
Title of each class                    Name of each exchange on which registered
Common Stock, Par Value $.01                              None

Check  whether  the  registrant  (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),
Yes ____ No X , and (2) has been  subject to such  filing  requirements  for the
past 90 days. Yes X No _____

Check if there is no disclosure of delinquent  filers in response to Item 405 of
Regulations  S-B is not  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-KSBA or any amendment to this Form 10-KSBA. [ ]

State the registrant's net revenue for its most recent fiscal year:  $0

The  aggregate  market  value of  voting  stock  held by  non-affiliates  of the
registrant on August 15, 1997, was approximately  $6,317,255 calculated based on
a value  of  $2.25  per  share  placed  on the  Registrant's  common  stock in a
transaction in which the Company participated on that date.

As of August 15, 1997,  5,222,833 shares of registrant's Common Stock, par value
$.01 per share,  2,397,732 shares of the registrant's Series A Preferred Shares,
par value  $.01 per  share,  and  354,825  shares of the  registrant's  Series B
Preferred Shares, par value $.01 per share, were outstanding.


<PAGE>



                      WIRELESS CABLE & COMMUNICATIONS, INC.
                                 August 15, 1997
                                  Form 10-KSBA

PART I.

                                   THE COMPANY


              Exact corporate name:     Wireless Cable & Communications, Inc.
   State and date of incorporation:     Nevada - July 23, 1995
Street address of principal office:     102 West 500 South, Suite 320
                                        Salt Lake City, Utah 84101
          Company telephone number:     (801) 328-5618
                   Fiscal year end:     December 31


                             BUSINESS AND PROPERTIES

A.   OVERVIEW

         The Company was formed to acquire,  develop,  operate and own  majority
interests  in  wireless  high  speed  data  transmission  and  reception,  video
conferencing,   Internet  access  (collectively,   "data  services"),  telephony
services and  wireless  cable  television  systems  located in emerging  markets
outside  the  United  States.  The  Company  holds or has the  right to  acquire
wireless communications licenses or lease interests in five countries which have
an aggregate  population  of  approximately  43 million,  including New Zealand,
Venezuela,  Costa Rica,  Guatemala,  and Panama (the  "Market  Countries").  The
Company  also  expects to obtain  additional  cable  licenses or lease rights in
other emerging markets, primarily in Latin American.

         Within the Company's  Market  Countries,  management  has identified 11
medium and large cities (the "Target  Markets") in which it intends to launch or
expand  wireless cable  television  and/or data service  systems over the next 3
years.  The Company  believes a significant  portion of that  population  can be
served  by  line-of-sight  ("LOS")  transmissions.  LOS  transmission  generally
requires a direct, unobstructed transmission path from a central or cellularized
transmitting  antenna to an antenna located at the  subscriber's  location.  The
Company's   system   development   plans  will   require   substantial   capital
expenditures.  There can be no  assurance  the  Company  will be able to acquire
amounts  (either  through  debt or equity  fundings)  sufficient  to fund  those
capital   expenditures.   See   "Profitability   Milestones"  and  "Management's
Discussion and Analysis of Certain  Relevant  Factors," below. If the Company is
unable to secure significant additional debt or equity financing there can be no
assurance that it be able to continue as a going concern.

         The Company  believes many  underdeveloped  countries,  particularly in
Latin America, are experiencing rapid economic and population growth, as well as
unparalleled  demand for expanded  television program and data services options.
In contrast with the United  States,  where hardwire cable systems and telephone
companies were the pioneers in meeting the demand for multi-channel

                                       2


<PAGE>



subscription   television  and  data  services,  the  hardwire  cable  industry,
telephone companies and wireless communications  industries concurrently entered
the  market  in these  emerging  growth  markets.  The  Company  estimates  that
wireless/hardwire cable television penetration of Latin American and New Zealand
households  is   approximately  8%  and  .04%   respectively,   as  compared  to
approximately  63% in  the  United  States,  and  that  wireless  data  services
penetration in Latin America and New Zealand is also substantially lower than in
the United States.  The Company believes that, within 10 years, more than 30% of
Latin  American  and New Zealand  homes will  subscribe to  multi-channel  cable
television  and satellite  television  services  which are capable of delivering
50-150 channels of  programming.  During the same period,  the Company  believes
that a significant  percentage of the Latin  American and New Zealand  potential
data service subscribers will subscribe to data services.

         In the Company's  Latin  American  markets,  current  wireless/hardwire
cable  penetration is estimated at  approximately  6% of television  households,
generally  reflecting less developed  national  economies and slowly  developing
cable  infrastructures.  In New  Zealand,  broadband  television  services  with
significant channel capacity is in the beginning stages of development,  despite
a  household  television  penetration  rate  of more  than  95%.  In its  Market
Countries,  the Company  believes  that  delivery by wireless  cable of expanded
multi-channel  television  programming has an inherent advantage due to the ease
of  lower  cost at  which  subscribers  can be added  vis a vis  hardwire  cable
television operations in the same regions.

         The Company  believes it has several  business,  management  and market
strengths  which will  differentiate  it from its  competitors.  These strengths
include the following:

         Attractive  Market  Demographics.  Each  of the  Market  Countries  has
demographic and other  characteristics the Company believes are favorable to the
ownership  and  operation  of  multi-channel  wireless  cable and data  services
subscription systems,  including limited affordable or unreliable  entertainment
and/or data services options, moderate medium income per capita, high television
household  penetration rates and low  wireless/hardwire  cable and data services
penetration  rates.  In  addition,  television  viewers in the Market  Countries
currently have limited off-air television options.

         Exclusive Rights in Markets.  Local regulatory agencies typically grant
one or two licenses per geographic  area for a given GHz frequency  range.  This
finite spectra allocation serves as a natural entry barrier to competition.  The
Company  holds or has the right to acquire  exclusive  28 GHz or 40 GHz wireless
cable  license  rights  in the  majority  of the  Market  Countries.  Due to the
broadband  nature  of the 28 GHz  and 40 GHz  technology  platforms,  management
believes  the  Company  will  be  able to  provide  numerous  telecommunications
services to its potential  subscribers,  including telephone and high speed data
capabilities,  multi-channel  television  services  and internet  access,  video
conferencing and interactive television.

         Limited  Market  Competition.  The  Company  believes  there is limited
competition  within the Market Countries that has the ability to provide similar
data  services  and  multi-channel  television  services  at a price the Company
believes will be competitive with the Company's

                                        3

<PAGE>



pricing  structure  for its  services.  The Company  believes it will be able to
enter its Target Markets and quickly establish itself as the preferred broadcast
telecommunications provider to mainstream consumer households and businesses.

         Managed  Subscriber  Penetration.  The nature of the Company's wireless
communications  technology  permits the buildout of markets in a more  efficient
and cost effective manner than the Company believes is capable in hardwire cable
systems.  Whereas a hardwire cable system  requires the  construction of a cable
network from the headend facility to subscriber  locations,  often through areas
where no viable  subscriber  base exists,  a wireless  communication  system may
broadcast  directly to the  subscriber  locations  or to a cellular  rebroadcast
facility that broadcasts to the subscriber locations. The Company believes that,
at a penetration rate of approximately 20%, wireless  communications systems can
deliver cable television and data services at  approximately  one-third the cost
per subscriber of hardwire cable systems.

         Strong Local  Partners.  The Company selects local partners within each
of its local markets to assist it in its business  operations in those  markets.
The Company  generally  selects  financially  strong local partners who are both
influential and respected  within their countries and who will work closely with
the Company's senior management.  Local partners play an active role in securing
licenses and obtaining necessary regulatory  approvals,  assisting in arranging,
identifying and evaluating  opportunities for the Company's  wireless  projects,
and providing local advocacy for the Company's business operations.

         The  Company  intends  to employ a number  of  business  strategies  to
achieve its  objectives of acquiring,  developing  and operating  wireless cable
systems in the Market  Countries.  In general,  the Company  believes the Market
Countries  typically  have less  competition  from alternate  entertainment  and
communication formats and that wireless  communications systems provide the most
economical  method  of  providing  multi-channel  television  and data  services
subscription  services to  potential  subscribers.  The Company  believes  that,
because it will be the first such  service  provider  in many of the  markets to
provide  competitively  priced  television  packages  offering  over 30  program
channels (including local marketing programming) with a high quality picture and
reliable,  secure and relatively  inexpensive data services, the Company will be
able to secure a significant subscriber base with a minimal subscriber turnover.

         Focus on High  Subscriber  Growth  and Cash  Flow.  In order to achieve
positive cash flow as soon as possible,  the Company plans  initially to develop
markets in which it believes there is the most potential to generate significant
subscriber  growth.  The Company  believes these markets include the significant
metropolitan  areas within the Company's Market Countries,  including,  Caracas,
Venezuela  and  Auckland,  New  Zealand,  where the  market  areas have a denser
population with a relatively high television  ownership rate, greater demand for
data services and more disposable  income.  The Company intends to construct and
launch its wireless communications systems as soon as possible and achieve rapid
penetration  in the Target  Markets by being the first provider of wireless data
services  and  wireless  multi-channel  television  subscription  services.  The
Company  initially  intends to focus its  developmental  and  marketing  efforts
within the Target Markets on subscribers  for the Company's data services.  Once
the Target Markets are cash flow

                                        4

<PAGE>



positive,  the Company  intends to focus on expanding its existing data services
systems into the  surrounding  areas of its markets to maximize  subscribers and
penetration.  The Company then intends to follow a similar  pattern in marketing
its multi-channel television services.

         Strategic  Alliances.  The Company has entered into strategic alliances
with a number of companies and entities already active in the Latin American and
South  American  utilities  and  communications  markets.  One of its  principal
strategic  alliances  is with  FondElec  Group,  Inc.  ("FondElec"),  a Delaware
corporation,  which, together with its affiliates,  currently owns, operates and
invests in a number of  electrical  and other  utilities  in South  American and
Latin American  countries.  FondElec is one of the Company's  shareholders  and,
together with the Company, has formed LatinCom,  Inc.  ("LatinCom"),  a Delaware
corporation.  LatinCom was formed to acquire, own and operate wireless cable and
other communication rights in Brazil, Peru, and Mexico.

B.   DESCRIPTION OF THE COMPANY'S BUSINESS.

         As of August 15,  1997,  the Company  holds or has the right to acquire
wireless  communications  licenses or lease  interests in five markets having an
aggregate  population of  approximately  43 million people.  These markets,  the
Market Countries,  include New Zealand,  Venezuela,  Costa Rica, Guatemala,  and
Panama.  The Company is also seeking  wireless cable licenses or lease rights in
other  markets  on its own  behalf  and  through  LatinCom,  its  joint  venture
corporation  with FondElec Group,  Inc. The Company's  current  interests in the
Market Countries  include the ownership of approximately  68.14% of an operating
system located in Caracas,  Venezuela (the  "Operating  System").  The Operating
System has  approximately  1,280  subscribers.  The Company  holds or intends to
acquire a contractual right to majority  economic  interest  positions in all of
its markets.  In certain markets where government  regulations  prohibit foreign
control of licenses or other aspects of the Company's business  operations,  the
Company has  attempted  to acquire  minority  interests  in those  entities in a
manner which it believes will provide it with significant management influence.

         Assuming the  availability of sufficient  debt or equity  financing (in
the approximate  amount of $10 million),  the Company has targeted 11 medium and
large cities (the Target Markets) within the Company's Market Countries in which
it intends to launch wireless  communications  systems  (primarily data services
systems)  over the next three years.  The Target  Markets  include the Operating
System  and 10 other  non-operating  systems,  of which the  Company  expects to
commence  construction  activities  on 2 by the end of 1997  assuming it obtains
sufficient financing.

         As of August  15,  1997,  the  Company  had  contractual  interests  in
wireless communications markets covering an estimated 43 million people ("POPS")
and the Operating System (located in Caracas,  Venezuela)  served  approximately
1,280 subscribers.  The Operating System is in the early stages of operation and
is expanding its subscriber base. Unless otherwise  specifically  stated herein,
all information in this report  describes the Company's  business and operations
as of December 31, 1996. The Company has included certain  information  relating
to subsequent  events in an effort to provide a basis for better  evaluating the
Company's operations.


                                        5

<PAGE>



Company Background

         The  Separation.  The Company was formed for the purpose of  continuing
the  development  of  certain   business  assets  formerly  held  by  Transworld
Telecommunications,  Inc. ("TTI").  TTI is also in the wireless cable television
industry  and,  through its joint venture  entity,  Wireless  Holdings,  Inc., a
Delaware joint venture  corporation  ("WHI"),  TTI owns operating wireless cable
systems in Spokane, Washington and San Francisco,  California, and non-operating
wireless systems or channel lease rights in Seattle,  Washington,  San Diego and
Victorville, California, and Greenville, South Carolina. Prior to May, 1997, TTI
also owned an interest in an operating  wireless  cable system  located in Tampa
Bay,  Florida and,  prior to the  formation of the Company,  owned the Company's
interest in the New Zealand license  rights.  The WHI and Tampa Bay systems have
approximately 20,000 subscribers.

         On July 26,  1995,  the board of directors of TTI voted to separate its
business assets into two groups. The first group of business assets consisted of
TTI's interest in the WHI systems and the Tampa Bay, Florida system.  The second
group of assets included TTI's interest in the New Zealand licenses,  and other,
miscellaneous,   assets.  Under  the  terms  of  the  business  separation  (the
"Separation"),  TTI  agreed  to form a new  corporation  to hold  the  separated
business  operations,  and  the  stock  of  that  corporation  was  then  to  be
distributed to TTI's shareholders.

         In order to complete the  separation,  the Company was  incorporated on
July 31, 1995, and on August 1, 1995, it issued  3,500,000  shares of its common
stock to TTI in exchange for TTI's  interest in the New Zealand  license  rights
and miscellaneous assets. TTI immediately  transferred the shares of the Company
to an escrow agent,  Fidelity  Transfer  Company of Salt Lake City,  Utah, to be
held for the  benefit of TTI's  shareholders  of record on August 1,  1995.  The
distribution of the 3,500,000 shares to TTI's shareholders was delayed until the
Company  complied  with certain  requirements  of the federal  securities  laws,
including the  registration  of the Company's  shares pursuant to a registration
statement on Form 10-SB under the  Securities  Exchange Act of 1934, as amended.
Shortly after the effective date of that registration  statement,  the 3,500,000
shares held by Fidelity Transfer Company were transferred to TTI's  shareholders
of record as of August 1, 1995, on a non-pro rata basis, with the management and
principal  shareholder  of TTI  relinquishing  a portion of their  shares in the
Company  in  favor  of the TTI  public  shareholders.  In  general,  the  public
shareholders received approximately 1.6 shares of the Company's common stock for
each ten shares of TTI common stock they held on August 1, 1995.

         TIC  Transaction.  Prior to January 31,  1997,  the  Company's  primary
business  assets  consisted of its interest in its New Zealand assets and a 4.4%
equity  interest in the  licensee of certain  wireless  communication  rights in
Venezuela.  See  "Operating  Systems,"  below,  and the  Company's  registration
statement on Form 10-SB dated  December 30, 1996, as amended.  In late 1996, the
Company  entered  into  negotiations  with  a  Delaware   corporation,   Telecom
Investment  Corporation  ("TIC")  regarding  the terms of a potential  merger or
acquisition.  TIC held or had the right to acquire wireless communication rights
in a number of South American and Latin American countries, including Venezuela,
Costa Rica, Panama, Peru and Guatemala.


                                        6

<PAGE>



         On January 31, 1997, the Company  entered into a transaction  with TIC,
pursuant to which TIC merged with a newly formed wholly-owned  subsidiary of the
Company,  NewWCCI,  Inc. The merger was  effective  February 4, 1997.  Under the
terms of the merger, the former shareholders of TIC received 2,397,732 shares of
the  Company's  newly  designated  Series A  Preferred  Shares  and TIC became a
wholly-owned  subsidiary of the Company (the "TIC  Transaction").  A copy of the
merger agreement  between  NewWCCI,  Inc. and TIC is attached as Exhibit 10.5 to
this report.

         The number of Series A Preferred Shares the TIC  shareholders  received
in the TIC  Transaction  was based  primarily  on a valuation of Latin and South
American wireless cable rights that was prepared by a securities  underwriter in
the fall of 1996 in connection with a proposed registered public offering of the
Company's Common Stock. The parties also considered other factors in determining
their respective  values for purposes of the TIC Transaction,  including current
and anticipated debt obligations, the funds expended by the parties in acquiring
their   respective   rights,   the  Company's  and  TIC's  pre-TIC   Transaction
relationships  (including  the fact that the Company had  previously  loaned TIC
funds for various business purposes), TIC's and the Company's joint interests in
the  Venezuelan  market rights and the fact that the Company had agreed to enter
into an option to acquire the lessee of the  Venezuelan  licensee as nominee for
TIC,  and  recent  changes  in the make up and value of the  Company's  wireless
rights in New  Zealand.  The  valuations  assume full  build-out of each system,
which has yet to occur. As of August 15, 1997, currently neither company has any
systems in  operation,  other than the  Venezuelan  Operating  System.  Any such
build-out would require  significant  capital  expenditures by the Company.  See
"Profitability Milestones."

         The Series A  Preferred  Shares  issued to the former TIC  shareholders
generally have all of the rights and preferences of the Company's Common Shares,
but  are  also  entitled  to  certain   preferences   regarding  voting  rights,
liquidation  amounts and dividend  amounts.  See  "Description of Capital Stock,
below." As a result of the merger, the former shareholders and option holders of
TIC currently hold  approximately  87.7% of the voting power of the Company on a
common share equivalent basis.

         LatinCom,  Inc. In January,  1997, the Company and FondElec Group, Inc.
formed LatinCom, Inc., a Delaware joint venture corporation,  for the purpose of
pursuing wireless  communication  rights in Peru,  Brazil and Mexico.  Under the
terms of  LatinCom's  formation,  the  Company  received 45 shares of the common
stock of LatinCom,  Inc.,  representing  45% of the total issued and outstanding
capital  stock of the company.  The remaining 55 issued and  outstanding  shares
(representing  55% of the issued and outstanding  shares of LatinCom,  Inc.) are
held by FondElec  Group,  Inc. (which holds 45 shares) and certain third parties
and officers and  directors of the Company (who  collectively  held 10 shares of
LatinCom).  The 10% of  LatinCom  held by the  Company's  management  and  third
parties is non-dilutable.

         FondElec  and the  Company  have each  agreed to fund  one-half  of the
operations of LatinCom  relating to the  acquisition of wireless cable rights in
Peru, Brazil and Mexico.  The Company  anticipates that LatinCom's  shareholders
will enter into a shareholders agreement which,

                                        7

<PAGE>



among other things,  will restrict the transferability of their LatinCom shares.
See "Certain Relationship and Related Transactions, below."

         CVV Transaction. On August 15, 1997, the Company completed the purchase
of 68.14% of Caracas Viva Vision TV, S.A. ("CVV"), a Venezuelan company that has
the rights to exploit the 28 GHz frequency  band rights for the entire  Republic
of Venezuela, pursuant to a stock purchase and option agreement, as amended (the
"Option Agreement"). The Company also has an agreement to purchase an additional
10% of CVV. The Company  initially  entered into this contract as the nominee of
TIC. As a result of the TIC  Transaction,  however,  the Company  acquired TIC's
interest in the CVV option.

         CVV  operates  an  existing  wireless  cable  television  system  which
currently has approximately 1,280 subscribers, representing approximately .3% of
the potential multi-channel  television subscribers in the system's market area.
Under the terms of the Option Agreement, the Company paid and delivered $200,000
in cash,  1,577,000 shares of the Company's common stock,  354,825 shares of the
Company's newly designated  Series "B" Preferred Shares and a promissory note in
the amount of $200,000.  The  promissory  note  accrues  interest at the rate of
6.75% per annum and the  principal  and all  accrued  interest is payable in one
principal  installment  due on or before the earlier of (i) October 15, 1997, or
(ii) ten days after the closing by the Company of an  investment  in the capital
of the Company in excess of $2 million.

         In  conjunction  with this  purchase,  the  Company  and certain of its
shareholders  also  entered  into a  voting  agreement  to  elect a  former  CVV
principal to the board of  directors of the Company  until the earlier of August
14,  2000 or  immediately  preceding  the  closing of a public  offering  by the
Company  which  results in net  proceeds  of at least $15  million  and a market
capitalization of at least $50 million.

         On August 1, 1997,  the Company and the  remaining  shareholder  of CVV
entered into an additional amendment to the Option Agreement whereby the Company
agreed to purchase an additional 10% of the total outstanding  shares of CVV for
$800,000 in cash. On August 15, 1997, the  shareholder had not complied with the
terms of the amendment to the Option Agreement and is in default.

Demand for The Company's Services

         Many  under-developed  countries,  particularly  in Latin America,  are
experiencing  rapid  economic and  population  growth,  as well as  unparalleled
demand for expanded multi-channel  television program and data services options.
In contrast with the United  States,  where hardwire cable systems and telephone
companies were the pioneers in meeting the demand for multi-channel subscription
television and data services,  the hardwire cable industry,  telephone companies
and wireless cable  industry  concurrently  entered the wireless  communications
market in these emerging growth markets.


                                        8

<PAGE>



         The  Company  believes  that a  relatively  smaller  proportion  of the
prospective  data  services  subscribers  in Latin  America  and New Zealand are
served through traditional hardwire cable or telephone services,  as compared to
the United States.  The Company also believes that, within ten years significant
portions  of  the  potential   Latin  American  and  New  Zealand  data  service
subscribers will subscribe to a data services  provider.  The Company intends to
conduct market  surveys in the Market  Countries in order to quantify the extent
of the current  potential data services  subscribers in its Market Countries and
the number of those potential subscribers that anticipate they will subscribe to
data services within the next 10 years.

         The Company estimates that wireless/hardwire cable penetration of Latin
American and New Zealand households is approximately 7% and 0.4%,  respectively,
as compared to approximately 63% in the United States. An additional 3% of Latin
American households (typically the most affluent homes) are estimated to utilize
satellite dishes and receivers to obtain  multichannel  television  programming.
The Company believes that within ten years more than 30% of Latin American homes
and more than 25% of New Zealand homes will subscribe to multichannel television
cable and satellite  services which are capable of delivering 50 to 150 channels
of programming.

         In the Company's  Latin  American  markets,  current  wireless/hardwire
cable  penetration is estimated at  approximately  7% of television  households,
generally  reflecting less developed  national  economies and slowly  developing
cable  infrastructures.  In  New  Zealand,  broadband  television  service  with
significant channel capacity is in the beginning stages of development,  despite
a  household  television  penetration  rate of more than 95%.  In both its Latin
American and New Zealand markets, the Company believes that delivery by wireless
cable of multi-channel expanded programming has an inherent advantage due to the
ease and lower cost at which  subscribers  can be added vis a vis hardwire cable
television operations in the region.

         The following table sets forth certain  information with respect to the
countries in which the  Company's  operating  companies  and  development  stage
projects are located:

<TABLE>
<S>                    <C>             <C>             <C>               <C>             <C>             <C>          <C>

                                                                                                                (4)              (5)
                                                                                                                1994            1994
                             (1)              (2)           (2),(3)             (4)             (4)        Wireless/       Wireless/
                       Estimated           Annual      PPP-Adjusted           Total            1994         Hardware        Hardware
                           Total       Population           GNP Per         Country      Television            Cable           Cable
                      Population           Growth           Capital      Households      Households      Subscribers     Penetration
                        Millions          1990-94             (US$)         (000's)         (000's)          (000's)  (% of TV HH's)
                        --------          -------             -----         -------         -------          -------  --------------

Costa Rica                   3.5          2.1%          $3,200  (6)             557             545               38            7.0%

Guatemala                   11.3          2.9%           1,200                2,022           1,200              175           14.6%

Panama                       2.7          1.9%           2,200                  584             400               75           18.8%

Venezuela                   22.0          2.3%           4,490                4,500           4,489              177            3.9%

New Zealand                  3.5          0.9%          17,230                1,200           1,150                5            0.4%


<FN>

(1) Source: U.S. Bureau of Census, International Data Base, 1996
(2) Source: World Bank, World Development Report 1996.
(3)  PPP-Adjusted  GNP Per Capita  denotes  gross  national  product  per capita
adjusted for relative purchasing power available to the consumer.
(4) Source: 1995 TV International Source Book.
(5) Television Household Penetration is computed by dividing Wireless/Hardware Cable Subscribers by Television Households.
(6) Data for Costa  Rica not  available.  Estimated  based on  purchasing  power
adjustment  for  Panama  applied  to GNP Per  Capita for Costa Rica as quoted by
World Bank, World Development Report 1996.

</FN>
</TABLE>

                                       9

<PAGE>




Business Strategy

         The  Company's  overall  business  objective is to become a significant
provider  of data  services  and  wireless  television  in  targeted  developing
countries.  The Company  believes that a wireless  data  services  operation may
successfully  compete  in the  marketplace  only  where  it  provides  reliable,
relatively  fast  and  secure  services  to  potential   customers  at  a  price
competitive  with other  comparable  services.  The Company also believes that a
wireless cable television  operation may successfully compete in the marketplace
only  where  it  provides  attractive  multichannel   programming  to  potential
subscribers at a price competitive with other comparable  services  available to
those  subscribers.  Additionally,  the Company believes that superior  customer
service can secure a stable  subscriber  base,  facilitate  the  acquisition  of
market share from existing competitors,  and inhibit market share acquisition by
new competitors entering the Company's markets. The Company's  implementation of
its business  strategies  is contingent  upon its ability to obtain  significant
additional debt or equity financing.

         The Company intends to focus its business  efforts on the expansion and
launch of its  wireless  data  services  within the Target  Markets.  The Target
Markets consist of 11 of the largest  population centers in the Company's Market
Countries.  After the Company  expands and launches its wireless  data  services
within the Target Markets, it intends to expand those services to other areas in
its Market  Countries.  Thereafter,  the Company intends to build-out and launch
wireless  cable  television  services,  first in the  Target  Markets,  and then
throughout the other areas of the Market Countries.

         Initially,  the company  anticipated  that it would focus its  business
efforts on wireless cable television services,  not wireless data services.  The
Company's  current focus on wireless data services is based  primarily  upon its
belief that those services can be  implemented  in a more cost effective  manner
than wireless television services ($10 to $15 million for the launch of its data
services  systems  versus $100 to $250  million  for the launch of its  wireless
cable  television  systems),  and that the  subscriber  base for  wireless  data
services  is, in  general,  more  affluent,  stable and willing to pay, as an up
front cost, all or a substantial part of the installation and equipment costs of
those services. As a result, the Company believes that, by first emphasizing the
wireless data services available through its wireless communications license and
lease  rights,  it will be able more  quickly  to  achieve  positive  cash flow,
thereby facilitating the Company's  acquisition of additional debt and/or equity
financing,  and the  development  and launch of its  wireless  cable  television
services.

         The Company  employs the following  business  strategies to achieve its
objective of acquiring, developing and operating wireless communications systems
and  channel  rights  in which  it may  hold a  majority  interest  in  emerging
international markets:

         Focus on  Developing  Markets.  The  Company's  strategy is to acquire,
develop and operate wireless  communications systems in under-served  developing
countries  where  management  believes  there is a high demand for wireless data
services and wireless  multi-channel  television services.  The Company believes
such markets typically have less competition from alternate data

                                       10

<PAGE>



services  delivery  systems  and  entertainment  formats,  and  that a  wireless
communications  system  provides the most  economical  method of providing  such
services to potential subscribers. The Company believes that, because it will be
the  first  such  service   provider  in  many  of  its  markets  to  provide  a
competitively  priced service,  the Company will be able to secure a significant
subscriber base with minimal subscriber turnover.

         Maximize Subscriber Penetration. In order to achieve positive cash flow
as soon as possible,  the Company plans initially to develop markets in which it
believes there is the most potential to generate significant  subscriber growth.
The Company  believes these markets include the significant  metropolitan  areas
within  the  Company's  Market  Countries,   including  Caracas,  Venezuela  and
Auckland,  New  Zealand,  where the market area has a denser  population  with a
relatively  high  television  ownership  rate,  greater  demand  and use of data
services and more disposable income. The Company intends to construct and launch
its wireless  communications  systems as soon as is possible  and achieve  rapid
penetration  in its  Target  Markets  areas by being  the  first  provider  of a
wireless  communications  service at a reasonable  price. The Company intends to
first focus on the build-out  and launch of its wireless  data  services  system
within the Target Markets.  Once the Target Markets are cash flow positive,  the
Company  intends to focus on expanding its wireless  data services  systems into
surrounding  areas of its  markets  to  maximize  subscribers  and  penetration.
Thereafter,  the Company  intends to  build-out  and launch its  wireless  cable
television  systems,  first in the Target Markets and then throughout the Market
Countries.

         Offer Attractive  Programming Packages. In order to maximize the number
of the  Company's  subscribers,  management  intends to offer a wide  variety of
wireless data services packages and both English and local-language  programming
on its wireless cable television  systems.  The Company's typical wireless cable
television  system will offer local language  programming  for news,  movies and
sporting  events,   as  well  as  a  wide  range  of  popular  English  language
programming.

         Utilize and Support Local  Management.  The Company  intends to rely on
local country managers to develop existing operating  companies and identify new
wireless  communications  opportunities  within its local  markets.  The Company
anticipates  that its local  managers will be natives of the local  market,  and
that they typically have significant  managerial and operating experience.  They
will be supported by the Company's corporate operations staff, which the Company
anticipates  will be located in South  Florida.  Use of local country  managers,
supported by the Company's experienced corporate staff, will allow it to rapidly
and effectively respond to operational  matters,  develop and maintain effective
working   relationships   with  local   partners  and   capitalize  on  wireless
communications opportunities.

         Capitalize on Technological Capabilities. The Company believes that one
of the primary  advantages of offering service through its broad-band 28 GHz and
40 GHz wireless  spectrums will be the Company's  ability to offer wireless data
services as well as wireless  multi-channel cable television  services.  Each of
the 28 GHz and 40 GHz  spectrums  provide more  bandwidth for a single user than
the combined  bandwidths of AM and FM radio,  VHF and UHF television,  MMDS, SMR
Radio, Cellular Telephone, PCS and the entire Geosynchronous Satellite C-band.

                                       11

<PAGE>



The Company believes it has the opportunity to become the single-source provider
of  telecommunication  products (including  multi-channel  television  services,
telephone  access and high-speed  data services such as the Internet) in each of
its markets in which licensing restrictions permit.

         Pursue Low Cost Structure.  Wireless  communications  systems typically
cost significantly less to build and operate than traditional  hardwire systems,
due primarily to the hardwire cable plant  requirement for an extensive  network
of coaxial or fiber-optic cable,  amplifiers and related equipment.  Ultimately,
the  Company  believes  it can  further  reduce  its  incremental  cost  per new
subscriber in comparison to local operators  through savings from bulk purchases
of subscriber equipment, including set-top boxes and antennas, for the aggregate
of new  subscribers  in its multiple  markets.  The Company  estimates that each
additional  wireless  cable  television  or data  service  subscriber  currently
requires an incremental  capital expenditure by the Company (other than head-end
costs) of approximately $350 to $385, consisting of, on average, $275 to $300 of
material and $50 to $150 of installation costs and overhead charges.

Acquisition Strategy

         The  Company  does not rely  exclusively  on the  number  of  potential
subscribers in evaluating potential markets.  Instead, it has developed a series
of more complex  criteria to analyze  prospective  acquisitions.  These criteria
include  wireless  channel  availability,   the  existence  of  any  established
groupings or blocks of  channels,  the type of potential  subscriber  base,  the
nature,  quality  and extent of service  provided by  existing  and  traditional
communications  systems,  topography,  demographics,  the  existence of a strong
local strategic partner,  political and economic risk,  governmental  regulation
and other  factors.  The Company  also  evaluates  the  potential  acquisition's
ability to  facilitate  the Company's use of economies of scale and increase its
operating  efficiencies,  particularly  where a  market  acquisition  can add to
existing regional market clusters. The Company intends to continue to pursue its
expansion  strategy  in the  future  by  acquiring  and  building  out  wireless
communications  systems in markets  outside of the United  States  that meet its
market selection criteria.

Company Markets

         The table below provides  information  regarding the Market  Countries.
The  information  presented  is based on  assumptions  and  estimates  which the
Company  believes to be  reasonable,  but there is no  guarantee  the  Company's
estimates are accurate. Data shown are presented as of August 15, 1997:

                                       12

<PAGE>


<TABLE>
<S>                  <C>                <C>                <C>              <C>

                                                           Estimated        Estimated
                                                           Total            Target
                                        Company            Television       Television
                     System             Participation      Households       Households
Country/City         Technology         Percentage(1)      (Thousands)      (Thousands)

Costa Rica

  San Jose           LMDS                92.5%             259              197

Guatemala

  Guatemala City     LMDS                80.0%             366              201

Panama

  Panama City        LMDS                90.0%             182              107

Venezuela

  Caracas            LMDS/Cable          78.1%             899              719

  Maracaibo          LMDS                78.1%             297              237

  Valencia           LMDS                78.1%             225              180

  Maracay            LMDS                78.1%             175              140

  Barquisimeto       LMDS                78.1%             162              130

  Cuidad/Guayana     LMDS                78.1%             111               89

New Zealand

  Auckland           MVDS/               94.9%             320              275
                     MMDS/
                     Cable

  Wellington         MVDS/               94.9%             109               94
                     MMDS/
                     Cable

  Christchurch       MVDS/               94.9%             105               90
                     MMDS/
                     Cable


<FN>

(1)      See   "Business--Operating   Systems"  and  "Business--Pending   Launch
         Systems," below, for a summary of the manner in which the Company holds
         or has the right to acquire the interests shown. The Company's interest
         in a number  of the  markets  is based on its  rights  under  executory
         contracts.  There  can be no  assurance  the  Company  will  be able to
         acquire or hold the interest shown.
</FN>
</TABLE>

Operating Systems

         The following information summarizes the Company's rights in the Market
Countries where there are existing wireless or hardwire  operating  systems.  As
used in this  section  and the other  sections  of this  report  describing  the
Company's  business  operations  and wireless  communications  rights,  the term
"Company" refers to Wireless Cable & Communications, Inc.
and its direct and indirect subsidiaries:


                                       13

<PAGE>



         Venezuela.

         Background.   As  of  August  15,   1997,   the  Company  had  acquired
approximately  8.5% of the license holder of the  nationwide 28 GHz  frequencies
for all of the  Republic of  Venezuela  and 68.14% of the entity which holds the
rights to exploit the frequency  rights.  The Company's  investment in Venezuela
was  motivated  by  an  opportunity  to  acquire  what  it  believes  to  be  an
under-funded existing wireless cable television system in the Caracas-Los Teques
area of Venezuela with nationwide  frequency rights in what the Company believes
is an  under-served,  multi-channel  television  market.  The  Company  believes
Venezuela   possesses  several  desirable  market   characteristics,   including
political  stability,  stable  population  growth with moderate per capita gross
national product, and improving economic conditions and currency stability.

         The Company's initial market in Venezuela, the Caracas-Los Teques area,
covers   approximately   899,000   households.    Those   households   represent
approximately  20%  of  the  potential   Venezuelan  wireless  cable  television
subscribing  households.  The Company has not  conducted  any market  surveys to
determine the percentage of the potential data services subscribers in Venezuela
that the  Caracas-Los  Teques area covers,  but  believes  that the area holds a
significant  percentage  of  the  potential  data  services  subscribers  in the
country. The Company believes significant  subscriber growth potential exists in
the Caracas-Los Teques area and in the Company's other Venezuelan Target Markets
due to the low  hardwire  cable and MMDS  penetration  rate  (approximately  8.5
percent  in Caracas  and 4 percent  nationwide),  the  inherent  difficulty  for
hardwire cable  expansion due to poorly marked  underground  utilities,  and the
lack of other data services options.  The Company's Target Markets in Venezuela,
including  the  Caracas-Los  Teques  area,  aggregate  approximately  42% of the
nationwide household count.

         The  Company  believes  that  the  high  population   density  and  the
installation difficulties encountered by competing hardwire cable systems in the
Company's  Venezuelan  markets is  conducive  to rapid  wireless  communications
subscriber penetration, and that adequate funding for its Venezuelan system will
produce rapid expansion of that subscriber base.

         Ownership and  Management  Structure.  On August 15, 1997,  the Company
completed  the  purchase  of 68.14% of Caracas  Viva  Vision TV,  S.A.  ("CVV"),
pursuant to the Option Agreement.  The Company also has an agreement to purchase
an additional 10% of CVV. See the section  entitled  "Company  Background" for a
more  detailed  description  of the terms of the  Company's  acquisition  of its
interest in CVV.

         In conjunction  with the Option  Agreement,  the Company also agreed to
acquire  up  to  an  11.53%   interest   in   Comunicaciones   Centurion,   S.A.
("Centurion"),  the  Venezuelan  corporation  that holds the  nationwide  28 GHz
frequency  concession.  As of August 15, 1997,  the Company had paid $845,955 of
its total  potential  investment  of $1,153,000  for its Centurion  interest and
holds  approximately  8.5% of  Centurion.  Centurion  has entered  into  service
agreements  under  which it has  granted  CVV the  exclusive  rights  to use its
licensed frequencies. The obligation to invest in Centurion ceased on August 15,
1997  when the  Company  exercised  its  option  to  purchase  the  stock of CVV
according to the terms described above under the Option Agreement.

                                       14

<PAGE>




         Operating and Growth  Strategy.  CVV's immediate  growth strategy is to
increase its Caracas-Los Teques wireless cable subscriber base by increasing its
television marketing efforts.  Historically,  CVV has enjoyed constrained growth
due to limited  funding.  In the future,  CVV intends to launch a wireless  data
service  operation  in the  Caracas-Los  Teques  service  area and,  thereafter,
intends to launch wireless data services  operations within the other Venezuelan
Target  Markets.  CVV then  intends  to launch  its  wireless  cable  television
services in the  Venezuelan  Target  Markets other than the  Caracas-Los  Teques
market area. The Company  anticipates  that it will initiate  renewed  marketing
efforts for its wireless cable television  services,  and begin marketing of its
data  services,  in the  Caracas-Los  Teques market area as soon as funds become
available.  Assuming  adequate  funding,  the Company believes that it will have
between  45,000  and  50,000  wireless  cable  television   subscribers  in  the
Caracas-Los Teques market area by the end of 1999.

         Programming.  CVV currently offers basic  subscribers up to 49 channels
of television programming, including a wide range of entertainment, news, sports
and educational channels.
CVV does not currently provide any data services.

         Franchises  and  Government  Regulation.  The  Commission  Nacional  de
Telecomunicaciones  ("CONATEL")  of the  Venezuelan  Ministry of  Transport  and
Communications has granted Centurion  exclusive rights to the 28 GHz frequencies
throughout  the Republic of Venezuela.  The license has a twelve-year  term, and
expires in April, 2005. The license may be renewed for an additional twelve-year
term if Centurion has complied with the conditions of the concession.  Centurion
pays CONATEL an annual  telecommunications  tax of 1.0% of gross  invoicing  for
subscriber  services and a quarterly  concession fee of 0.5% of gross  invoicing
for subscriber  services.  Centurion and CVV are also obligated to provide three
channels for  governmental  or public  interest  programming and must obtain the
approval of CONATEL to offer telecommunication services other than multi-channel
subscription  television or  pay-per-view  programming.  CVV has also  requested
approval to provide high speed data services using the 28 GHz frequencies.

         New Zealand.

         Background.  The  Company  acquired  its New Zealand  market  rights in
August of 1995 in  connection  with the  Separation.  The  Company's New Zealand
channel  rights  are  held by  Auckland  Independent  Television  Service,  Ltd.
("AITS"),  which is owned 94.9% by the  Company.  AITS has acquired the right to
four MMDS  channels in the Auckland  area and has also  acquired  the  exclusive
license rights for the 40 GHz frequencies in the Auckland area, with countrywide
expansion  rights as applied for on a city by city  basis.  AITS' 40 GHz license
rights permit the delivery of television, data and telephony services.

         The New  Zealand  market is  characterized  by a  developed  and stable
economy, high per capita income, and high household television penetration.  New
Zealand also has limited  multi-channel  television  offerings,  reflecting slow
multi-channel    development    as   a   result    of    historically    limited
satellite-delivered   programming.    Consequently,    wireless/hardwire   cable
penetration of

                                       15

<PAGE>



television households in New Zealand is very low, approximately 0.4 percent. The
Company  also  believes  there is  significant  demand for data  services in New
Zealand,  but that  penetration of those services into the  marketplace has been
hampered by limited data services options.

         With the launch of additional  satellites to provide programming in the
Asian region and the rapid development of multi-channel television in Australia,
the quality and quantity of available programming has increased significantly in
New Zealand. The Company believes that its wireless cable technology and ease of
system  buildout  will produce  rapid growth of its  wireless  cable  television
subscriber base in New Zealand.

         Ownership  and  Management  Structure.  The Company owns 94.9% of AITS.
AITS holds license  rights to four Auckland area MMDS channels to be operated at
frequencies  ranging from 2.3 to 2.4 GHz under lease  agreements which expire in
2004.  Both licenses have provisions  providing  extensions to the initial term,
although  there can be no  assurance  that the  license  will be  renewed.  AITS
originally  held the rights to ten (10) MMDS channels in the Auckland  area, but
the lease  agreements to six (6) of those  channels  expired in December of 1996
and were not renewed by the lessor. AITS has also been granted exclusive license
rights at 40 GHz,  the New Zealand  LMDS  frequency,  for video,  voice and data
services on a  city-by-city  basis,  as requested by AITS and subject to certain
utilization requirements.

         Operating and Growth  Strategy.  AITS' growth  strategy is based on the
rapid  deployment of its 40 GHz system in the New Zealand  Target  Markets.  The
Company believes that its proposed subscription rate structure and data services
menus for its anticipated  wireless cable television  services and wireless data
services will represent  attractive  packages for prospective  subscribers.  The
Company also believes that the current low multi-channel  television penetration
rates, combined with a highly visible marketing program will produce significant
subscriber  growth in the Company's  New Zealand  Target  Markets.  Assuming the
acquisition of sufficient financing,  the Company anticipates that it will begin
the build-out of the Auckland,  New Zealand 40 GHz market in mid 1997,  and that
it will launch its data services subscriber drive shortly thereafter.

         Programming.  AITS plans to provide a variety of data services packages
and a wide variety of cable  television  programming in its New Zealand wireless
cable television markets,  including a range of entertainment,  news, sports and
educational channels, as well as pay-per-view programming.

         Franchises  and  Government  Regulation.  The  regulation  of  2.5  GHz
multi-distribution  licenses  and 40 GHz  licenses in New Zealand is governed by
the Radio  Communications  Act of 1989 (the "New Zealand Act").  The New Zealand
Act governs the  licensing  and  regulation  of radio  equipment or licensing to
authorize the  transmission of radio waves.  The New Zealand Act is administered
by the Ministry of Commerce.

         The management rights for particular frequency bands are created by the
Secretary of Commerce.  Any manager granted particular  frequency rights has the
authority to create licenses

                                       16

<PAGE>



to transmit  radio waves on those  frequencies.  These  licenses  are granted in
accordance with the provisions of the New Zealand Act, but the terms under which
they are allocated are determined by the manager. Management rights and licenses
are  generally  issued for long  periods,  sometimes  for  periods as long as 20
years. Management rights and licenses may be traded, and are deemed to be assets
of a business  for  purposes  of the  Commerce  Act of 1986,  as well as the New
Zealand  anti-trust  statute.  No written instrument dealing with the management
rights or  granting  or  transferring  of any  licenses  has effect  until it is
registered in accordance with the New Zealand Act.

         Radio apparatus licensing is governed by the Radio Regulations of 1987,
which were  continued  under the New  Zealand  Act,  and which  provide  for the
licensing of radio  transmitting  and receiving  equipment.  All radio apparatus
licenses granted by the Ministry of Commerce are renewable annually.

Pending Launch Systems

         The   following   information   summarizes   the   Company's   wireless
communications rights in Market Countries where there are currently no operating
systems in which it has or will acquire interests.

         Costa Rica.

         Background.  The Company has entered into an agreement to acquire 92.5%
of Television Interactiva,  S.A. ("TISA"), a Costa Rican corporation that leases
license  rights from a Costa Rican citizen who was granted the  concession for 2
GHz of bandwidth  in the Costa Rican 28 GHz  frequency  range.  Costa Rica has a
stable  economy and a political  environment  with  higher  than  average  Latin
American  household  incomes  and  moderately  low  multi-channel   subscription
television penetration--all attributes the Company seeks in prospective markets.

         The Company  believes it can obtain  rapid  subscriber  growth in Costa
Rica  due  to the  Country's  low  multi-channel  subscription  television,  the
perceived  low data  services  penetration  rate and the  strong  household  and
business income characteristics.  The Company's Target Market in San Jose, Costa
Rica has  approximately  259,000  households,  almost  47% of the total  country
households.

         Ownership  and  Management  Structure.  The Company  has  entered  into
agreements  with local Costa Rican  partners  for the purchase of an interest in
TISA. The Company will own 92.5% of the shares of TISA, while the remaining 7.5%
will be held on a non-dilutive basis by Groupo Continental, S.A. ("Groupo"). The
Company is obligated to fund all  expenditures  for development and construction
of TISA's telecommunications business in Costa Rica. The Company expects to meet
its funding obligations through a series of loans, investments,  or by arranging
financing with third parties.  Groupo is a San Jose,  Costa  Rica-based  company
engaged in a variety of wireless technology services in Central America. As TISA
develops its wireless

                                       17

<PAGE>



operations  in Costa Rica,  the  Company  expects  TISA to contract  for certain
technical services from Groupo.

         Evita  Arguedas  Maklouf,  a citizen  of Costa Rica and the spouse of a
principal  of  Groupo,  holds  licenses/concessions  issued by the  Costa  Rican
government  for the 27.5 to 29.5 GHz bands of  frequency.  TISA and Ms.  Maklouf
have  entered  into an  agreement  under which TISA has leased the rights to the
licenses/concessions  for 15 years. At the end of the initial lease period,  the
parties will negotiate an extension of the lease. Lease fees under the agreement
are the greater of $200,000 per year or 2.0% of gross revenue from  subscribers,
payable  in arrears  and  beginning  at the end of the first year after  initial
subscribers begin making payments.  TISA will also pay all costs for development
of telecommunications systems utilizing the frequencies.

         Operating and Growth Strategy.  TISA will focus initially on developing
its wireless  communications  products in San Jose,  Costa Rica. TISA intends to
establish its service  capability  through a rapid  build-out of facilities  and
intends to implement  an  intensive  marketing  effort  encompassing  broadbased
community  involvement  projects to attract  subscribers and establish its local
identity.

         The Company  believes that responsive  customer service and competitive
monthly  subscription  rates are key  ingredients to local success in attracting
subscribers  in Costa Rica. The Company also believes that its planned rates are
competitive   with   entertainment   alternatives  in  San  Jose,   Costa  Rica,
particularly existing multi-channel television subscription services, as well as
the limited competing data services providers.

         Assuming that the Company obtains funding which is sufficient to launch
its data services systems  (approximately $10 million to $15 million),  it plans
to initiate  construction  of broadcast  facilities  in San Jose,  Costa Rica in
mid-1997.

         Programming.   The   Company   plans  to  provide  a  broad   range  of
entertainment,  news, sports and educational programming, as well as a number of
data services packages.

         Franchises and  Government  Regulation.  The license  concession to the
27.5 to 29.5 GHz  bandwidth  was issued to Ms.  Maklouf by the Control  Nacional
Radio,  Ministry of  Government  and Policy of the  Republic of Costa Rica.  The
license concession has been granted for use in providing video and data services
throughout Costa Rica.

         The  license  concession  is  granted  without  expiration,  as long as
services are provided through the frequencies.  Signals must be available within
six months (plus a six-month extension) to meet license requirements.


                                       18

<PAGE>



         Guatemala.

         Background.  The Company has entered  into a  definitive  agreement  to
acquire a 70%  interest  in  VivaVision  de  Guatemala  ("Viva"),  a  Guatemalan
corporation  that has a right to exploit the exclusive  rights to one GHz in the
28 GHz broadcast  frequency band in Guatemala.  These rights permit the delivery
of both wireless cable television and data and voice services. Guatemala has the
largest  population  in Central  America and a growing and  increasingly  stable
economy  that  provides  low to  moderate  household  income  to  its  citizens.
Guatemala  has a highly  competitive  multi-channel  television  industry with a
large number of smaller  hardwire cable  operators.  Telephone and data delivery
service in  Guatemala  is  relatively  antiquated,  with  significant  delays to
customers in providing service, meeting demand and maintaining system integrity.

         The Company believes that it can obtain  significant  subscriber growth
in its  Guatemalan  Target  Market,  Guatemala  City,  by providing  competitive
monthly  subscriber  rates for television and data services and superior quality
and  service.  Guatemala  City  has  approximately  18% of the  total 2  million
households in Guatemala.

         Ownership  and  Management  Structure.  The Company has entered  into a
definitive agreement with Alfredo Herrera Cabrera,  Milton Herrera, Ron Vaisbort
and Joaquin Sufuentes pursuant to which the Company will acquire a 70% ownership
interest in Viva in return for funding  100% of the  expenditures  necessary  to
develop and construct wireless  communication  facilities  necessary to initiate
television  and data service  operations in Guatemala.  The Company  anticipates
that it will  meet its  funding  commitment  through a  combination  of debt and
capital  contributions,  but may also arrange debt through  third  parties.  The
Company has also  acquired the right to purchase an  additional  10% of Viva for
$500,000  at any  time  before  Viva  has the  full  use of the 27.5 to 28.5 GHz
frequency  band and has a first  right of  refusal  to  acquire  any  additional
spectrum  at  the  28.5  to  29.5  band  that  Viva  acquires  for  delivery  of
multichannel television,  data and voice services. Viva pays the licensee of the
rights to be used by Viva $1,000 annually.

         Operating  and Growth  Strategy.  Assuming  sufficient  financing,  the
Company  plans to  complete  buildout  of a  wireless  communication  system  in
Guatemala City in early 1998 that has a LOS capability for approximately 200,000
households.  The Company  intends to initially  aggressively  market Viva's data
services  in  Guatemala  City,  and then  expand its  marketing  plan to include
wireless cable television services.  Because of the highly competitive nature of
the Guatemalan market,  the Company  anticipates that it will have only moderate
subscriber  growth.  Nevertheless,  the Company  expects that its Guatemala City
system will have between 15,000 and 20,000 wireless cable television subscribers
by the end of 1999.

         Programming.  In addition to its data  services  packages,  the Company
plans to offer an extensive  array of programming  consisting of  entertainment,
news, sports, educational and pay-per-view events.


                                       19

<PAGE>



         Franchises and Governmental Regulations. Mr. Alfredo Herrera Cabrera, a
citizen of  Guatemala,  holds a license  issued by the  Guatemalan  Ministry  of
Commerce,  Transportation  and Public  Works and  authorized  by the  Counsel of
Frequencies and International Affairs of Radio on November 22, 1995. The license
is valid for an initial term of 25 years and may be extended  for an  additional
25 year term.  Commercial  terrestrial  stations are  obligated to install,  and
reserve  within their  systems,  the frequency  capacity for three  channels for
exclusive use by universities  legally established in the Republic of Guatemala,
the Ministry of Culture and Sports,  and the  Secretary of Public  Relations for
the President of the Republic of Guatemala.

         Panama.

         Background.  The Company has entered into a letter of intent to acquire
90% of a  Panamanian  joint  venture  that will own and operate  wireless  cable
television and data services  systems in the 28 GHz frequency  band. The Company
expects to  execute  definitive  agreements  for the  acquisition  of the Panama
rights in the next few weeks. The Panamanian license rights include authority to
provide both  multi-channel  subscription  television service and data services.
The Company views Panama as an attractive  market due to its higher than average
household  income levels,  high level of household  television  penetration  and
expanding commercial business base. The country also exhibits a stable political
environment and improving economy.

         Ownership and Management  Structure.  The Company has executed a letter
of  intent  with  Administracion  E.  Inversiones  Radials,  S.A.  ("AIRSA"),  a
Panamanian  company engaged in  broadcasting  and  engineering,  to form a joint
venture  in Panama  which  will  operate  an LMDS  system  utilizing  the 28 GHz
frequencies for multichannel  television and data services.  The Company expects
to execute definitive agreements for the acquisition of the Panama rights in the
next few weeks. The Company assisted AIRSA in obtaining its initial LMDS license
at 28 GHz and, more recently,  facilitated  expansion of the license rights held
by AIRSA to include the 27.5 to 29.5 GHz frequency range.

         Under the Company's  agreement with AIRSA, AIRSA will assign its rights
to the  frequencies  to the joint  venture in exchange  for a 10%  non-dilutable
interest in the joint  venture,  with the Company  owning the remaining 90%. The
Company is obligated to fund or provide funding for all  expenditures  necessary
to bring the  venture  to  operating  status.  The  Company  intends to meet its
funding  obligations  through loans,  arranging  loans through third parties and
through capital contributions.

         Operating and Growth Strategy.  Assuming the availability of sufficient
financing,  the  Company  expects to  complete  construction  of its Panama City
wireless  cable  television   broadcast  facilities  in  early  1998,  with  LOS
capability  for  approximately  100,000  households.  The Company  will launch a
parallel  effort to obtain a substantial  position in providing data services to
commercial  enterprises  in the  market.  The  Company  believes  that the joint
venture  can  establish  a  substantial  customer  base in Panama by offering an
extensive array of quality  programming and selectively  providing data services
to commercial and home customers.  Multi-channel subscription penetration in the
Panama market is approximately 18.8%, with Panama City

                                       20

<PAGE>



comprising  approximately 182,000 households (or approximately 31%) of the total
households in Panama.

         Programming.  In addition to its data  services  packages,  the Company
plans to offer a varied package of  programming in the Panama market,  including
entertainment, news, sports, educational and pay-per-view events.

         Franchises and Government Regulation. On June 17, 1996, the Nacional de
Medios de  Comunicacion  Social of the Republic of Panama issued AIRSA  licenses
for the 27.6 to 28.08 GHz and 6086.0 Mhz frequency  bands.  On October 15, 1996,
the frequency  allocation  was increased to cover the 27.5 to 29.5 GHz frequency
band,  with  authorization  to provide  both  subscription  television  and data
services.  The license is perpetual,  based on continued  operations  within all
regulations.

Other System Opportunities

         The Company is currently  pursuing  wireless cable  license,  lease and
operating rights in a number of other countries in Latin America. The Company is
also pursuing wireless  communication rights in Brazil,  Mexico and Peru through
LatinCom, in which the Company holds a 45% interest.  See "Certain Relationships
and Related  Transactions."  While there can be no assurance the Company will be
successful  in securing  such license,  lease or operating  rights,  the Company
believes  that  additional   Latin  or  South  American  markets  would  provide
additional  economies  of  scale  with  respect  to  programming  and  equipment
acquisition.

System Operations

         Marketing.  Prior to initiating the buildout of a potential new market,
the Company  intends to conduct  pre-launch  studies to evaluate the  population
demographics  and physical  terrain of that market.  The Company then intends to
create a development  plan that identifies the market potential of various areas
within  the  target  market  and that,  based on  factors  including  television
penetration,  income levels and existing  competition,  and then will define the
probable  locations  of the  headend  transmission  facility  and cell sites for
retransmission.  As the construction of facilities nears completion, the Company
will then  conduct a marketing  program  targeted to those areas  identified  as
having the greatest  potential for subscriber  growth.  The Company's  marketing
programs  typically  include (i)  neighborhood  door-to-door  sales of services,
including multiple dwelling unit meetings and door hangers,  (ii) marketing tied
to regional events such as high interest  sporting events,  (iii) television and
newspaper advertisements, and (iv) other promotional activities such as referral
programs and promotional gifts.

         Installation.  The Company's  installation  package for wireless  cable
television  service will include a standard  rooftop  mounted  antenna and other
related  equipment,  such  as  cabling  and a  settop  decoder  located  at  the
subscriber's  location.  Installations at single-family  homes require an entire
installation package,  whereas installations at multiple dwelling units in which
drop lines have been installed  will require less time and expense.  The Company
anticipates it will charge

                                       21

<PAGE>



its television  service  subscribers an installation  fee ranging from $19.95 to
$49.95 with an equipment deposit of $49.95.

         The  Company's  installation  package for data  services will include a
standard roof-top mounted antenna and other related  equipment,  such as cabling
and any required decoders or transmitters located at the subscriber's  location.
The Company  anticipates  that it will charge its data services  subscribers  an
installation  fee ranging from $950 to $2,500,  depending on the type of service
involved.  In contrast to the Company's  wireless cable television  subscribers,
the  Company  anticipates  that it will be able to  require  its  data  services
subscribers to pay the entire cost of installation  (and any related  equipment)
up front. As a result,  the Company  anticipates  that it will be able to obtain
positive cash flow from those subscribers almost immediately.

         Customer  Service.  The Company  believes that providing high levels of
customer service in installation and maintenance will enable it to maintain high
levels  of  customer  satisfaction  and  minimize  subscriber  churn.  With this
objective  in mind,  the  Company  will  strive  to (i)  complete  installations
promptly,  (ii) provide prompt customer service using a customer hotline,  (iii)
provide  timely repair  service,  and (iv) make new subscriber  follow-up  calls
after installation to ensure customer satisfaction. The Company will also strive
to impart a  "customer  service"  mentality  in its  employees  through  ongoing
training and intends to establish an employee  forum to facilitate  the exchange
of ideas regarding improvements in customer service. The Company also intends to
adopt various  employee  incentive  programs  linked to achieving high levels of
customer satisfaction.

         Management  Information  Systems and  Billing.  The Company  intends to
utilize  a  commercial  management  information  system  tailored  to  meet  the
requirements of the subscription television and high speed data industries. This
system will include capabilities that facilitate monitoring customer service and
customer payment patterns,  monitoring  subscriber  equipment and installations,
and managing each operating system  efficiently.  The Company has five employees
in Caracas  currently  dedicated  to  integration  of the  Company's  management
information system to all aspects of its Venezuelan operation.

         The Company  believes that its billing  procedures  will be an integral
part of its  strategy to maintain  high levels of customer  satisfaction  and to
minimize  subscriber  churn. The Company  anticipates that subscribers will have
the opportunity to select (on a one time basis and at the time of  installation)
the day of the month on which  payment  for that  month's  service  is due.  The
Company  anticipates  that subscribers will also be able to pay their bills at a
bank through direct transfers,  or use the Company's mobile  collection  service
for  payment.  If a customer  does not pay his bill within 15 days after the due
date, the customer's service will be automatically  disconnected and his account
receivable  will be sent to a collection  agency.  If the customer  does not pay
within another 30 days, the collection  agency will forward the customer's  name
to a private credit agency for further action. After disconnection of subscriber
service due to nonpayment,  a Company installer will be sent to the subscriber's
location to recover the installed  equipment  for re-use with a new  subscriber.
The Company intends to communicate with

                                       22

<PAGE>



delinquent  subscribers  to encourage the payment of past-due  accounts so as to
avoid disconnection if possible.

Wireless Communications Systems and Technology

         General.  The Company believes that there is a large and growing demand
for wireless  communications systems in emerging growth countries,  particularly
the Market Countries.  A large part of this growing demand results directly from
the  expanding  nature of and need for data  services.  The  number  of  devices
currently  accessing the world wide computer web is approximately  12.6 million.
That number is expected to grow to approximately 233 million devices in the year
2000.  A large  portion of this growth will occur in emerging  growth  countries
such as the Market Countries.  The Company expects that demand for multi-channel
television will similarly grow in the next few years.

         Wireless  communications  systems use microwave radio frequencies which
are licensed by a governmental  agency in each market to provide high speed data
transmission,   internet  access,  telephony  and  multiple  channel  television
programming.  The  microwave  signals  are  transmitted  over  the air  from the
head-end to an antenna at each subscriber's  location,  eliminating the need for
the networks of cable and amplifiers  utilized by traditional  cable  operators.
The wireless communications system can also incorporate an "interactive" feature
which will allow  subscribers  to modify the type of data  received and transmit
commands and requests.

         Engineering  and  construction  of a  wireless  communications  systems
typically  can  be  completed  in 120 to 180  days,  whereas  construction  of a
traditional cable or telephone system with comparable coverage areas may take as
long as three to five  years.  The radio  frequencies  used in such  systems are
typically in the 2.5, 18, 28 and/or 40 GHz frequency  bands,  depending on local
frequency licensing standards and practices.  Systems operating at 2.5 GHz carry
the  designation  "multi-channel  multi-point  distribution  systems"  or  MMDS;
systems operating at 28 GHz are designated as "local  multi-point  distributions
systems,"  or  LMDS,  while  systems  operating  at 40 GHz  are  referred  to as
"multi-point  video  distribution  systems,"  or MVDS.  The 18 GHz  frequency is
typically used for cable operator  point-to-point  service  transmission between
geographically separate properties, thereby eliminating the requirement to build
a complete satellite signal reception facility for each property.  The Company's
channel rights in New Zealand consist of MMDS and MVDS channels.  Forty GHz MVDS
channels are now being utilized in parts of Europe and are generally  considered
to be an  alternative  to 28 GHz LMDS systems,  which are typically  used in the
United States and Latin  America.  At present,  equipment  costs for 40 GHz MVDS
systems are marginally higher than those for other types of systems.  Typically,
the Company's license rights in Latin America consist of 28 GHz LMDS systems.

         A typical wireless communications system consists of head-end equipment
(satellite  signal  reception  equipment,  radio  transmitters,  other broadcast
equipment and transmission  antenna) and  reception/retransmission  equipment at
each  subscriber's  location  (antenna,  frequency  conversion  device and other
set-top devices). Currently, wireless cable television systems typically deliver
programming on 20 to 35 channels,  including local "off-air"  broadcast channels
that are received

                                       23

<PAGE>



directly by the customer's antenna rather than transmitted by the wireless cable
operators. Like traditional cable operators, wireless cable television operators
generally  are able to  offer a full  range of  basic  and  premium  programming
options,  including local off-air and on-air  channels,  movie  channels,  music
channels,  new and sports  channels and specialized  programming.  Wireless data
services  typically  deliver the same types of data services offered by hardwire
or telephone  systems,  including  internet  access,  telephony  services,  data
transmission  and  reception  services.  In  addition,  wireless  communications
systems can be used not only to connect  numerous  subscribers  to varying  data
services  ("internet data services"),  but related  subscribers to the same data
base or services ("intranet data services").  Intranet data services can be used
to link multiple subscriber  locations (such as all of the banks in a particular
banking system) into a particular data base.

         The  Company  believes  a  wireless  communications  system is the most
economical  technology  currently  available for the delivery of pay  television
service  and data  services.  Because  wireless  communications  systems  do not
require an extensive  network of coaxial cable and amplifiers,  the capital cost
per installed wireless  subscriber is substantially lower than for a traditional
cable or  telephone  system  operator.  This  cost  advantage  generally  allows
wireless  communications  system operators to provide programming to subscribers
at a lower cost than a hardwire cable or telephone system operator.  The Company
believes  wireless  communications  systems will  continue to maintain this cost
advantage,  even  following the  deployment of fiber  optics,  direct  broadcast
satellite and other microwave-based  emerging  technologies.  In general, all of
the Company's Market Countries are experiencing  rapid economic growth,  but are
hindered by inadequate  telecommunications  infrastructures.  In addition, lease
line  point-to-point  data  circuits  are  nearly  non-existent  in  the  Market
Countries,  thereby providing the Company with a viable and ready made potential
market.

         System  Configuration  and  Subscriber  Equipment.   To  a  subscriber,
wireless  communications  systems  operate  in the same  manner  as  traditional
hardwire systems. At the subscriber's  location,  microwave signals are received
by  an  antenna  and  are  passed  through   conventional  coaxial  cable  to  a
descrambling convertor located near the subscriber's television set (in the case
of  wireless  cable  television  services)  or  computer  (in  the  case of data
services).  Because  wireless  signals are transmitted  over the air rather than
through  underground or above-ground  cable networks,  wireless systems are less
susceptible  to outages  and are less  expensive  to operate and  maintain  than
franchise cable systems. In contrast to traditional cable systems,  most service
problems  experienced  by  wireless   communications   systems  subscribers  are
subscriber-specific rather than neighborhood-wide problems.

         Wireless systems using 2.5 GHz frequencies  typically  transmit signals
over  distances of 20 to 40 miles from their central  transmission  point,  and,
with an increase in transmission  power or tower height, may expand the coverage
area to  approximately  40 to 50 miles.  Wireless cable systems using the higher
frequency  formats (such as 28 GHz or 40 GHz) transmit signals over successively
shorter  distances.  In cases where edge fed cellular  architecture is used, the
transmission  coverage area is  approximately  3-5 kilometers,  while the use of
center fed cellular  architecture  allows a coverage area of approximately  6-10
kilometers. As the transmission

                                       24

<PAGE>



frequency increases for LMDS and MVDS transmissions, a cellularized distribution
architecture is used to ameliorate  line-of-sight  issues by providing  multiple
"look"  angles to adjacent  cells,  although  with  increased  capital costs for
additional cellular sites or engineering  techniques,  such a passive and active
micro-cells.   However,   the  natural  signal  attenuation  at  LMDS  and  MVDS
frequencies and the increased bandwidth available at those frequencies typically
provided  frequency re-use capability that provides  business  opportunities for
telephony and data services using the wireless cable  television  infrastructure
in locals where licensing restrictions permit.

         The   transmission   of   wireless   frequencies   requires   a   clear
"line-of-sight"  between the transmitter and the receiving  antenna.  Buildings,
dense foliage and hilly terrain can cause signal interference which can diminish
or  block  signals.  These  line-of-sight  constraints  can  be  ameliorated  by
increasing  the  transmission  power of the system  and/or by using  engineering
techniques such as  pre-amplifiers,  beam benders(TM) and signal repeaters,  but
these  techniques  generally  increase  the cost of  delivering  programming  to
subscribers.

         Because wireless  communications  systems use high gain antennas at the
subscriber end, ghosting,  reflection and interference are generally  minimized,
so picture and data quality typically exceeds that of other traditional  service
providers.  Further,  wireless  communications systems typically broadcast their
programming  at  wavelengths  that  are  long  in  relationship  to the  size of
raindrops, hail or snow, but short in comparison to interference normally caused
by electrical utility currents and motors. As a result,  wireless communications
transmissions  are usually not affected by weather or  electrical  interference.
Also, in traditional  cable systems the programming  signal declines in strength
as it  travels  along  the  cables  and  must be  boosted  by trunk  and  feeder
amplifiers.  Each  amplifier  introduces  some  distortion  into the  television
signal.  By contrast,  wireless  communications  systems use only two  principal
pieces of equipment -- a transmitter and a receiving antenna.

         Like traditional cable and telephone systems,  wireless  communications
systems  are  capable  of  employing  "addressable"   subscriber   authorization
technology,   which  enables  the  system  operator  to  control  centrally  the
programming  available to each subscriber without the need for a service call to
the subscriber's home. By eliminating service calls,  addressable systems reduce
the operating costs of a pay television or data services system.

         One of the primary advantages of a wireless communication system is the
ability to transmit data at much higher speeds than is normally possible through
cable,  telephone or fiber optic delivery methods. For example,  Hewlett Packard
has estimated that an  asymmetrical  LMDS system could  optimally  operate at 10
Mb/s downstream and 1.544 Mb/s upstream.  The significance of the transfer speed
can be seen in the chart below:

                                       25

<PAGE>





                     DOWNLOADING COMPARISON: 5 MEGABYTE FILE

                                                     Transfer
            Data Communications Speed                Time

            14.4 Kbps                                47 minutes
            28.8 Kbps (U.S. Standard)                23 minutes
            56 Kbps                                  12 minutes
            128 Kbps                                 5 minutes
            1.54 Mbps                                26 seconds
            4 Mbps                                   10 seconds
            10 Mbps                                  4 seconds
            45 Mbps                                  1 second


         In  addition,  due  to the  extraordinary  bandwidth  of the  Company's
typical LMDS frequencies, it has the ability to provide two-way capability. This
ability would allow  subscribers  to use the Company's  signal and technology to
"interact" with their television programming.  As an example, this ability would
allow a customer who sees a commercial that lists an internet  address to push a
button on their remote control to automatically  switch ("hyperlink") to the Web
page for that internet address.

Competition

         The  Company  believes  its  primary  competition  is from  traditional
fiberoptical and coaxial cable operators and telephone companies. The technology
used by such operators is a coaxial cable or  fiber-optic  system that transmits
signals from a head-end,  delivering local and satellite  delivered  programming
via a distribution  network  consisting of amplifiers,  cable and/or fiber-optic
other components to subscribers.  Regular system maintenance is necessary due to
water ingress,  temperature changes and other equipment  problems,  all of which
may affect the quality of the signal delivered by the cable or telephone company
to its  subscribers.  Traditional  cable and telephone  systems  typically  cost
significantly  more to build and  maintain  than  wireless  cable  systems.  The
Company  believes  the  head-end  equipment  costs of a wireless  communications
system are comparable to those for traditional  cable systems,  the installation
of coaxial cable and amplifiers is considerable more costly to traditional cable
operators than is the installation of reception  antennas and related  equipment
required by wireless cable operators.

         Several  technologies  are  under  development  that may  significantly
affect the pay television and high speed data services  industries and result in
new competitors  entering the market. The company cannot predict the competitive
impact of these new technologies and competitors on the wireless  communications
industry. The Company expects,  however, that wireless communications  operators
will be able to expand their  programming  capacity and  introduce new services,
while  continuing  to maintain a cost  advantage  over other  providers  of such
services. The Company

                                       26

<PAGE>



intends to exploit its comparative cost advantage by targeting a value-conscious
subscriber  base  that  may be  unwilling  to pay for more  costly,  specialized
programming or services.

         Fiber-optic  Systems,  Digital  Compression and  Interactive  Services.
Traditional cable systems  historically have been the principal providers of pay
television  services.  The maximum  number of  programming  channels  offered by
traditional  cable systems has been limited by the current  analog  transmission
and coaxial cable  technologies.  A number of new technologies are under various
stages of development to increase the channel  capacity of these systems.  These
new  developments  include the  replacement of traditional  cable system coaxial
cable  networks with  fiberoptic  networks and the use of digital  techniques to
compress more programming signals onto existing coaxial cable or other networks.

         The Company  believes the channel and information  content  capacity of
its wireless  communications  systems will be expandable through the application
of digital technology. Depending on the technology used, experts expect wireless
communications  systems to be  capable  of  transmitting  up to 10  channels  of
programming  in  the  bandwidth  in  which  one  channel  of   programming   was
historically broadcast. In addition, the Company expects that digital technology
will  enable  wireless   communications  systems  to  transmit  high  definition
television  signals.  Depending on the impact of  governmental  regulation  in a
specific  area,  the Company  anticipates  that the wireless  industry  (and the
traditional cable industry) will have commercial  access to digital  compression
technology within the next twelve months.

         The Company believes the typical subscriber may not use, or want to pay
for, the substantial increases in programming channel capacity available through
the application of compression  technology.  As a result,  while compression may
allow  wireless   communications   operators  to  expand   significantly   their
programming  capacity,  that  increased  capacity  may not  result  in  either a
substantial increase in a wireless communications  operator's subscriber base or
a  substantial  increase  in the  actual  amount of  programming  provided  by a
wireless communications operator.  Instead, the Company believes the compression
technology  may  have its most  important  impact  on the  number  of  operators
entering  the  wireless  communications  market,  since,  by  using  compression
technology,  wireless communications operators with rights to use as few as 3 or
4 channels may be able to provide the  equivalent  of up to 30 or 40 channels of
programming.  The Company  holds  adequate  frequency  spectrum in its  wireless
markets to permit  transmission of 32- 49 channels of program  capacity  without
adopting digital compression  technology,  but has adopted a system architecture
that permits a future migration to digital compression if and when it determines
that it is desirable to do so. The introduction of expanded channel capacity and
interactive  services by traditional cable systems will require  substantial new
investment.  Accordingly,  the  Company  does  not  expect  to  deploy  the  new
compression technologies until relatively inexpensive equipment is available and
its subscribers demonstrate sufficient demand.

         Telephone Company Competition. Recently a number of telephone companies
in the United  States and other markets have begun using  technology  capable of
providing audio/video services over telephone lines ("video dial tone" service).
These types of services are typically regulated by governmental  regulations and
rules. For example, in the United States the Federal

                                       27

<PAGE>



Communications  Commission  recently  adopted new regulations  permitting  local
telephone  companies  to  provide  video dial tone  service  in their  telephone
franchise  areas on a common  carrier  basis under certain  conditions.  Several
large United States  telephone  companies have announced plans either to enhance
their existing distribution plants to offer video dial tone service or construct
new distribution  plants in conjunction with a local  traditional cable operator
to offer video dial tone  service.  United States  telephone  companies are also
permitted  to  operate   hardwire  and  wireless  cable  systems  under  certain
conditions.  While the  competitive  effect of the entry of telephone  companies
into the pay television  business (where permitted by a specific  market's laws)
is still uncertain,  the Company believes that wireless  communications  systems
will  continue  to  maintain  a cost  advantage  over  video  dial tone  service
technologies.

         The Company's Market Countries are generally  hindered by an inadequate
telecommunications  infrastructures,  primarily  because  of the  state of their
telephone  services and the fact that those services  cannot,  in the opinion of
the Company,  meet the demands of an ever expanding global Internet demand.  The
Company  believes that (i) businesses and  governments  desire to participate in
those  types of  services,  but are unable to do so  because of that  inadequate
infrastructure,  and that (ii)  governments  desire to  improve  competitiveness
which will allow them to better participate in a global economy.  Therefore, the
Company believes that a wireless  communications system is an immediate and cost
effective manner of delivering and disseminating information from several points
to a number of subscribers in a manner which is not currently  available through
local telecommunications infrastructure.

         Satellite Systems.  "Backyard dish" or "direct-to-home" ("DTH") antenna
distributors  using  satellites to beam television  programming  offer customers
access to programming  similar to that offered by traditional  cable  operators.
The primary  advantages  of wireless  cable  systems  over DTH systems are lower
equipment costs and broader  availability of local programming.  DTH systems, on
the other hand,  enjoy the  advantages of access to a wider variety of satellite
programming  and the  ability to serve  areas not  serviced  by  traditional  or
wireless  communications  systems.  A  conventional  DTH  antenna  system  costs
approximately $1,000 to $3,000 per subscriber,  depending on the features of the
system,  plus  monthly  fees for  access to  certain  programming.  DTH  systems
typically  cannot  receive local off-air  broadcast  channels,  however,  so DTH
subscribers  generally  are not able to watch  local  news,  weather  or  sports
programs. DTH systems are typically not interactive, thereby precluding a number
of high speed data applications.

         Several  companies  have developed and sell  high-powered  transmission
satellites to distribute  high capacity  programming to DTH antennas as small as
18" in diameter  ("directed  broadcasting  satellite"  or "DBS").  DBS  receiver
equipment  for a  single  television  set is  typically  approximately  $600 per
customer,  plus  installation  fees (and monthly  subscriber  fees),  although a
number  of DBS  companies  have  recently  offered  equipment  and  subscription
packages at substantially lower initial costs. Due to the cost of DBS satellites
and receiving  equipment,  and because local programming cannot be received on a
DBS system, the Company believes wireless cable systems will continue to enjoy a
comparative cost and local programming advantage over these satellite systems.


                                       28

<PAGE>



         Other Microwave  Systems.  The Company's wireless cable operations will
typically be broadcast on microwave frequencies in the 28 GHz and 40 GHz ranges.
Frequencies other than the 28 GHz and 40 GHz ranges are currently authorized for
wireless cable operations in a number of market areas,  including frequencies in
the 2.5 GHz range and in the 18 GHz range.  The Company believes that the 28 GHz
and 40 GHz  frequency  bands  provide  advantages  over other  frequency  bands,
including  the  ability  to  transmit  data and  television  signals on the same
architecture,  its high capacity and its ability to be integrated into different
infrastructure.

         Private Cable Systems. Private cable systems also compete with wireless
cable  systems.  Private cable  systems are  multi-channel  television  services
offered through a wired plant that is similar to a traditional cable system, but
they operate  under  agreements  with  private  land owners to service  specific
multiple  dwelling units.  private cable systems may be used in conjunction with
wireless cable television operations.  Because private cable systems may only be
used to provide  programming  to multiple  dwelling  unit  subscribers  (such as
hotels and large apartment  complexes) the Company  believes that wireless cable
systems  should still enjoy an  competitive  advantage  over private  cable-only
systems.

Industry Trends

         The Company's business will be affected by industry trends and in order
to acquire,  maintain and increase its  subscriber  base,  the Company will need
rapidly to adapt and  modify its  practices  to remain  competitive  in light of
those trends. These trends include the following:

         Interactivity.  Several wireless  communications systems operators have
recently  publicized  their  intention to develop  interactive  services.  These
systems allow the services provider to offer features not generally available to
television  viewers,  including  the ability to choose  among  different  camera
angles and take part in game shows.  The Company  anticipates  that it may offer
interactive  capabilities  on its  wireless  cable  systems  in the  future,  as
additional channel capacity becomes available through digital compression.

         Pay-per-view  Services.  In recent years, the cable television industry
has promoted a service that enables  customers to order and pay for individually
selected programs.  This service,  known as "pay-per-view",  has been successful
for  specialty  events  such as  concerts  and  sporting  events,  but the cable
industry  has also been  promoting  the  pay-per-view  concept for  purchases of
movies  with the  idea of  competing  directly  with  video  rental  stores  and
theaters.  In order for  subscribers to subscribe to pay-per-view  events,  they
must have addressable converters,  which allow the cable company to control what
the subscriber  watches  without having to visit the  subscriber's  residence to
change equipment. The Company anticipates that all of the converters used in its
systems  will be  addressable,  allowing  subscribers  to  receive  pay-per-view
programming.  The  Company  believes  that  pay-per-view  services  will  become
increasingly  popular  as  additional  exclusive  events  become  available  for
distribution on pay-per-view channels. Certain cable operators have made efforts
to increase the use of pay-per-view  services by installing  "impulse"  devices,
which  make it easier for  subscribers  to select  programming  and which do not
require a return path to order the program in question.  The Company may utilize
impulse devices

                                       29

<PAGE>



on its  converters,  particularly  in Latin  America,  where  telephone  service
availability and wireless television service may not co-exist.

         Compression.  Several  equipment  manufacturers  have developed digital
compression  techniques  which allow several  programs to be carried  within the
bandwidth  that  historically  carried  only one program.  Various  experts have
estimated  that  compression  ratios of up to 10 to 1 are  possible.  Currently,
digital  compression  systems are the  operation  in  commercial  systems  which
provide  compression  ratios of as high as 8 to 1. The  Company  intends  to use
digital  compression  technology  in  its  systems  where  such  compression  is
permitted by governmental regulation and is economically feasible.

         Advertising.  Advertising on wireless and traditional  cable television
systems has been sold by program suppliers, which sell national advertising time
as part of the signal they  deliver to the cable  operators.  Advertisers  have,
however,  begun placing  advertisements  on channels  dedicated  exclusively  to
advertising,  as well as in the two minutes per hour of "local  available  time"
set  aside  by  program   suppliers  for  insertions  in  their  programming  of
advertisements  sold by the local cable  operators.  Use of local available time
requires  automatic "spot insertion"  equipment.  The Company expects to utilize
spot insertion equipment when it becomes economically prudent to do so.

Regulation

         The use of airwaves for microwave  transmission is generally subject to
extensive government regulation.  The amount, type and extent of that regulation
varies  from  country  to  country.  The  information  set  forth in each of the
Company's Market Countries summarizes certain government  regulations  affecting
the Company's ability to operate its wireless cable television  systems in those
markets. The regulatory structure for any particular market is subject to change
from time to time,  and any such  regulatory  change  could have a material  and
adverse effect on the particular market in which that change takes place, and/or
upon the Company's business as a whole.


                  PROPERTIES AND FACILITIES

         Equipment.  The Company has entered into an  agreement  with a wireless
communications  head-end  manufacturer for the lease of head-end  equipment at a
cost of $10,000  every  three (3) months per  head-end.  At the  election of the
Company the lease  payments can be applied toward the purchase of the equipment.
The total  purchase  price for each  system is $60,000.  The  Company  currently
leases  three such  systems,  which are  located in Costa  Rica,  Guatemala  and
Panama.




                                       30

<PAGE>



         Office Space.  The Company  shares  approximately  2,500 square feet of
leased office space at 102 West 500 South,  Suite 320, in Salt Lake City,  Utah.
Under the terms of the Company's  agreement with TTI, the Company is required to
make monthly payments of $200. The Company believes the office space is adequate
for its current needs.

         Channel  Rights.  The Company holds license rights (either  directly or
derivatively) for wireless  telecommunications  channels it uses in its markets.
It generally has acquired  those rights  pursuant to (i)  long-term  leases with
third party licensees,  (ii) arrangements  where it is the majority owner of the
licensing or leasing entity, or (iii) arrangements which it believes provides it
with  substantial  management  control of such licenses or leases.  Licenses for
wireless  communications channels in most markets that meet the Company's market
selection criteria have already been granted or applied for. Therefore, in order
to build and operate  wireless  communications  systems in new markets  where it
does not already control a critical number of channels, the Company will have to
purchase,  lease or otherwise acquire  sufficient  channel capacity from or with
third parties.

         The Company's current interests in channel rights in the various Market
Countries are described in the  descriptions  of the various  Market  Countries,
above.

         Programming.  The  Company  has  entered,  or expects to enter,  into a
number of  programming  contracts  with  commercial  programming  suppliers  and
packagers.  These  contracts  include  both master  agreements,  under which the
Company  will  use  specific  programming  in  most or all of its  markets,  and
regional specific contracts,  pursuant to which the Company will use programming
in regional or country  specific  markets.  As of August 15,  1997,  the Company
anticipates  that its programming  offerings will consist  substantially  of the
following:

                          Summary of Programming Rights


Country                Programming

New                    Zealand Cartoon Network,  TNT,  Discovery  Channel,  CNN,
                       Television  New Zealand  (for TV1,  TV2),  TV3,  Shopping
                       channel,  Country Music  Television,  Dentsche Welle, Sky
                       Television Network,  World Radio Network, CNBC, NBC Asia,
                       MCM  (Paris),  CFI Paris,  UIH  Australasian  Programming
                       Venture.

Venezuela              Master  programming  schedule(2),  plus Canal de Noticias
                       NBS, Cne Canal,  CMT, CNBC,  Cable Health Club,  Dentsche
                       Welle,  Hispa  Vision,  TBN,  TVE,  Travel  Channel Latin
                       America, TV5, Tele-UNO,  RA1, Nostalgia,  ME/U, MORMusic,
                       GEMS,  The Food Channel,  Worldnet,  RCTV,  Globo Vision,
                       Vene Vision, Metro Politano, VTV, and Televen.

Costa Rica             Master programming schedule(2), plus local off air
                       channels.

Panama                 Master programming schedule(2), plus local off air
                       channels.


Guatemala              Master programming schedule(2), plus local off air
                       channels.

                                       31

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

(1) Programming  currently used by the New Zealand hardwire television system to
be acquired by AITS.

(2) Consisting of HBO Ole', ESPN International/ESPN2,  CNN International/CNN/CNN
Headline,  TNT Latino  America,  Cartoon  Network  Latin  America,  MTV  Latino,
Discovery Latin America, Fox Latin American, A&E and USA Latino

<PAGE>

                  EMPLOYEES.

         At August  15,  1997,  the  Company  had one  full-time  employee - see
"Management Employment Agreements."

                  LITIGATION.

         The  Company is involved  in certain  litigation  matters in the normal
course of business which,  in the opinion of management,  will not result in any
material adverse effects on the Company.

                            PROFITABILITY MILESTONES

         The wireless  telecommunications  industry is a relatively new industry
which requires  sizable  amounts of capital to purchase  systems and significant
capital   expenditures  to  generate   subscribers  and  revenue  growth.  These
activities lead to a large amount of amortization and depreciation expense being
recorded. As a result,  companies in the wireless  communications  industry have
not historically been profitable.

         In management's  opinion,  a primary factor in obtaining equity or debt
financing in the wireless  communications industry is the generation of positive
monthly  operating  cash flow.  The Company did not generate a profit during the
period from July 31, 1995 through December 31, 1995 or for the fiscal year ended
December 31, 1996.

         The  Company's   management  believes  that  the  following  events  or
milestones must or should occur before the Company can begin generating positive
monthly operating cash flow:

                                       32

<PAGE>


<TABLE>
<S>                                  <C>                                        <C>
                                     Expected Manner of Occurrence              Date or Number of Months when
Event or Milestone                   or Method of Achievement                   Milestone
------------------                   -----------------------------              or Events Should be Accomplished
                                                                                --------------------------------
Build out of data services           Additional financing, either through       Approximately 18 months.
systems in the Company's             debt or equity fundings.
Target Markets

Build out and operation of           Additional debt or equity  financing.      If the Company obtains additional and
data  services  systems  in                                                     sufficient  debt or equity financing, it
areas of the Market                                                             anticipates  beginning  the build out of the
Countries other than the                                                        non-Targeted Market areas of the Market
Target Markets                                                                  Countries in 1998.


Build out and operation of           Additional debt or equity  financing.      If the Company is able to obtain sufficient
wireless  cable  television                                                     debt  and/or  equity financing, it anticiptates
systems in the Market                                                           that it will begin build out and operation of the
Countries                                                                       the wireless cable television systems in the
                                                                                Market Countries in 1998.
</TABLE>



         The  milestones  set forth above are  subject to a number of  business,
financial  and other  contingencies,  some of which may be beyond the control of
the Company. These contingencies include the following:

         Need for  Additional  Financing.  The growth of the Company's  business
requires  substantial  investment on a continuing  basis to finance  operations,
capital  expenditures  and related  expenses  for  subscriber  growth and system
acquisition and development.  The Company will require additional debt or equity
financing or achieve  profitability,  to cover  ongoing  operating  expenses and
capital  contributions,  to acquire additional wireless cable systems or channel
rights in existing or other  markets,  and to Build out,  operate and manage its
markets,  including the Target Markets.  The Company currently estimates that it
will  require  between $10 million and $15 million of  additional  financing  to
launch its data services  systems in the Target Markets and between $100 million
and $250 million to launch its wireless cable television  systems.  There can be
no assurance that such additional funds will be available on satisfactory  terms
and conditions, if at all. The Company's failure to obtain such additional funds
could adversely affect the growth,  profitability  and operation of the Company,
perhaps  materially.  To the extent future financing  requirements are satisfied
through the issuance of equity securities, then-current investors in the Company
may  experience  dilution  in the book  value per share of their  common  stock,
Series A Preferred Stock, and/or Series B Preferred Stock. Additional debt could
also result in a substantial  portion of the Company's cash flow from operations
being  dedicated to the payment of principal  and interest on such  indebtedness
and could  render the  Company  more  vulnerable  to  competitive  and  economic
downturns. Financing could also be obtained by the Company's operating companies
or development  stage  companies  from third  parties,  although there can be no
assurance that the Companies  operating companies or development stage companies
will  be  able  to  obtain  the  financing  required  to  make  planned  capital
expenditures,  provide  working  capital or meet other cash needs on terms which
are economically  acceptable to the Company.  See  "Management's  Discussion and
Analysis of Financial Condition and Results of Operations."


                                       33

<PAGE>




         Initial  Phases of  Development.  Almost all the  wireless  projects in
which the Company has (or has the right to acquire) an interest are in the early
stages  of  development.   Only  one  operating  company,  located  in  Caracas,
Venezuela,   currently  provides  wireless  cable  and/or  other  communications
services  on a  commercial  basis,  and that  operating  company  only  recently
initiated  commercial service and generally has a limited number of subscribers.
The Company has signed definitive agreements with a number of strategic partners
in the  Market  Countries,  but in some  cases the  parties'  have not  executed
definitive agreements or created definitive legal entities to effect the parties
proposed  business  operations.  Even in cases where the  Company  has  executed
definitive agreements with third parties in a particular market, there can be no
assurance that the Company will be able to perform its  obligations  under those
agreements  or that the terms of the  Company's  participation  in the operating
company or  development  stage project for that market will not be modified in a
manner that could be materially adverse to the Company.

         The  successful  development  and  commercialization  of the  Company's
markets will depend on a number of significant financial, logistical, technical,
marketing,  legal,  regulatory and other factors.  In addition,  there can be no
assurance that the Company's  proposed  systems will not encounter  engineering,
design or  operational  problems,  and there can be no assurance the Company can
successfully  develop any of its existing or planned development stage projects,
or that those  projects or any of the  operating  companies in which the Company
has or acquires an interest will achieve commercial success.

         Risks of Foreign  Investment.  The  Company  has  invested  substantial
resources  outside the United States and plans to make additional and continuing
investments  in countries  outside the United States in the future.  The Company
does not currently  anticipate that it will acquire,  or invest in, any wireless
communication assets or operations within the United States.

         Governments  of  many  developed  countries  have  exercised  and  will
continue to exercise substantial influence over many aspects of private business
enterprise.  Local  governments own or control  companies that are or may in the
future become competitors of the Company,  or companies upon which the operating
companies and  development  stage  projects in which the Company has an interest
may depend for  required  services  or  materials.  Governmental  actions in the
future could have a significant  effect on the economic  conditions  and many of
the  market  areas in which  the  Company  intends  to,  or has,  invested,  and
otherwise  may have a material  adverse  effect on the Company and its operating
companies and developmental  stage projects.  The Company's  interest in some or
all of the  Market  Countries  could be  adversely  affected  by  expropriation,
confiscatory   taxation,   nationalization,   political,   economic   or  social
instability  or other  developments  over  which the  Company  has  little or no
control.

         The Company does not currently  carry  political  risk insurance in the
market areas in which it conducts,  or intends to conduct,  business.  Moreover,
applicable  agreements  relating  to  the  Company's  interests  in  the  Market
Countries are frequently governed by foreign law. Therefore, it may be difficult
for the  Company to enforce  its rights  under the  agreements  relating  to its
rights.


                                       34

<PAGE>



         Difficulties  and   Uncertainties  of  New  Industry.   Wireless  cable
television  and  data  services  are  relatively  new  industries  with a  short
operating  history.  As a result,  the Company may experience  difficulties  and
uncertainties normally associated with new industries,  such as lack of consumer
acceptance,   difficulty  in  obtaining  financing,  increases  in  competition,
advances in technology and changes in laws and regulations.

         License and Lease  Issues.  The Company will be required to rely on the
existence  of,  and  continuing  ability to use or  exploit,  telecommunications
licenses which are typically  granted by  governmental  agencies on an exclusive
basis and for  limited  terms.  There  can be no  assurance  these  governmental
agencies  will not seek  unilaterally  to limit,  revoke or otherwise  adversely
modify the terms of any licenses they have granted or may in the future grant in
which the Company may have direct or  derivative  interest,  and the Company may
have very limited or no legal recourse if any of these events were to occur.  In
addition,  there can be no assurance  that  renewals of these  licenses  will be
granted upon their expiration or, if renewed, that the renewal terms will not be
substantially less favorable to the Company than the original license terms.

         Licenses may also be subject to significant  operating  restrictions or
conditions,   including   restrictions   relating  to  the   implementation   or
construction  of  system  improvements,  commercialization,   subscriber  rates,
royalties and other specified  deadlines or conditions  which, if not satisfied,
could result in the loss or revocation  of a license.  There can be no assurance
that,  if the  Company  is able to obtain a required  license or license  right,
those  operating  conditions  will be satisfied and, as a result,  that any such
licenses would not be lost,  revoked or otherwise  modified in a manner which is
materially adverse to the Company or its business operations.

         Operating,  Management and Other Market Agreement  Issues.  The Company
anticipates that it will depend on one or more local partners (or other parties)
in each of its market areas to obtain the use of required  licenses,  to conduct
business  operations in those markets,  and to facilitate the Company's business
operations with other local entities,  including governmental  authorities.  The
Company would be dependent on these strategic partners, although there can be no
assurance  that these  strategic  partners will perform in  accordance  with the
terms of any agreements they have with the Company.

         Under the terms of the Company's agreements with its strategic partners
in a number of the Market Countries, under the proposed terms of a number of the
agreements  for the  pending  acquisition  markets  and  under  the terms of the
Company's  agreements with LatinCom,  the Company will have  obligations to fund
substantial system construction and development costs. Any such construction and
development  will be capital  intensive and the Company will be required to seek
continuing  sources  of  financing  to  fund  working  capital  needs,   capital
expenditures and other cash  requirements.  The Company's failure to obtain such
financing  could have a material  adverse  effect on the Company,  including its
relationships with its strategic partners and, among other things,  could result
in the loss or revocation  of licenses  held by the  operating  companies in the
Market  Countries.  There can be no assurance the Company will be able to obtain
or secure financing sufficient to fund its capital expenditure obligations.


                                       35

<PAGE>



         In market  areas  where  the  Company  will be  required  to  construct
wireless   communications   networks   or   additions   to   existing   wireless
communications  networks,  that construction  activity may require the operating
companies and developmental  stage companies to obtain qualified  subcontractors
and necessary  equipment on a timely and cost effective  basis, the availability
of which could vary significantly from country to country. Construction projects
may be subject  to cost  overruns  and  delays  not  within  the  control of the
operating  company  or its  subcontractors,  such as  delays  caused  by acts of
governmental entities, financing or catastrophic occurrences.

         Among its other  strategic  alliances,  the  Company  has  joined  with
FondElec in the  formation of  LatinCom.  LatinCom was formed for the purpose of
acquiring,  developing,  owning and operating wireless  communication rights and
systems in Peru,  Argentina,  Mexico and Brazil.  There can be no assurance that
LatinCom will be able to acquire, develop or operate any wireless communications
systems and, if it fails to do so, the Company may be precluded  from  acquiring
or operating  wireless  communications  in the  countries in which  LatinCom was
formed to  operate.  Further,  although  LatinCom  was formed for the purpose of
acquiring  and  operating  wireless  communications  systems in  specific  South
American and Latin  American  countries,  there can be no assurance that it will
not develop contacts or learn of marketing opportunities in other Latin or South
American countries,  including countries in which the Company has or may have an
interest.  As a result,  there could be potential conflicts between the business
operations of the Company and LatinCom.

         Currency and International  Risks. A number of the markets in which the
Company currently has engaged, or intends to engage, in business has experienced
substantial rates of inflation and resulting high interest rates,  sometimes for
a period of many years.  Inflation and fluctuations in interest rates could have
a material adverse effect on the Company's operations and business. Further, the
value of the Company's  investments in its overseas  operations will depend,  in
part, on currency exchange rates between the United States dollar and applicable
local  currency.  The Company does not intend to hedge,  and has not in the past
hedged, against foreign currency change rate risks.

         Distributions  under the payments the Company  receives from  operating
subsidiaries  or  affiliates in the future may be subject to  withholding  taxes
imposed by the  jurisdictions  in which such  entities are formed or  operating.
United States corporations may generally claim foreign tax credits against their
United States federal income tax expenses for any foreign withholding taxes held
or actually paid with respect to companies in which the Company owns 10% or more
of the voting stock. The Company's ability to claim any such foreign tax credits
and to utilize  net  foreign  losses is,  however,  subject to  limitations  and
restrictions.

         Governmental Regulation.  The Company's business operations are subject
to  extensive  governmental  regulation.  This  regulation  can take the form of
limitations on the number of persons who can hold the  governmental  franchises,
service  requirements,  restrictions on foreign  ownership and subscriber rates,
instruction  requirements and programming  content  restrictions,  among others.
There can be no assurance that material and adverse changes in the regulation of
the Company's existing or future operations will not occur.

                                       36

<PAGE>




         Control of Operating Companies.  The Company intends to acquire,  where
possible  under  local law,  majority  interests  in each of its  operating  and
developing stage companies.  Applicable  local laws may,  however,  restrict the
interest the Company may acquire in those entities due to limitations on foreign
investments  in such  markets.  In such cases,  the  Company  intends to acquire
minority equity positions in the relevant operating company or development stage
company  which,  combined  with other  interests the Company will acquire in the
same market in management companies,  licensees or other entities will result in
the Company  obtaining  and  maintaining  substantial  control over the business
operations in any such market. Nevertheless,  there can be no assurance that the
Company  will,  in fact,  obtain  majority  interests in all of its markets,  or
obtain voting,  equity or management positions which could prevent the Company's
strategic  partner  in a  particular  market  from  implementing  strategies  or
business decisions inconsistent with those favored by the Company.

         Dependence on Programming  and Data Service  Providers.  The success of
the Company's wireless communications  operations will depend, in part, upon its
ability  to provide  programming  and data  services  for its  subscribers.  The
Company has entered  into,  or has begun  negotiations  to acquire,  programming
contracts with a number of programming  providers,  including CNN, HBO, MTV, The
Discovery  Channel  and others.  There can be no  assurance,  however,  that the
Company will be able to obtain  programming  contracts  with such  entities,  or
others,  or that it will be able  to do so upon  terms  which  it  believes  are
economically advisable.

         Possible  Non-Consummation  of Pending  Acquisitions.  The  Company has
entered  into  definitive  agreements  or letters of intend to acquire  wireless
communications rights in the Company's Market Countries, but the consummation of
each of those  transactions  is subject to certain  conditions.  There can be no
assurance  that the  Company  will enter  into  definitive  agreements  with any
parties with which it currently only has letters of intend. Upon its acquisition
of rights in a number of the Market  Countries,  the Company will be required to
invest significant capital and management time in order to develop and/or expand
the systems in those market areas. Most of the Company's wireless communications
rights do not constitute  operating systems and currently consist only of groups
of channel rights in specific market areas.  They do not include any programming
agreements,  subscribers or transmission or reception equipment. There can be no
assurance  that the Company  will able to Build out,  operate  and expand  those
systems successfully.

         Forward-looking   statements.   This  report  contains  forward-looking
statements,  which are not  historical  fact.  Such  forward-looking  statements
include the Company's  plans to launch  wireless  telecommunications  systems in
Latin  America and New Zealand.  Those  statements  also  include the  Company's
expectations  concerning factors affecting the markets for its services, such as
government regulations, competitive factors, and demand growth for the services.
Actual  results  could  differ  from  those  projected  in  any  forward-looking
statements  for the reasons  detailed  in the  Liquidity  and Capital  Resources
section  of this  report  and other  risks  detailed  within  this  report.  The
forward-looking statements are made as of the date of this report.



                                       37

<PAGE>



                     DIVIDENDS DISTRIBUTIONS AND REDEMPTIONS

         The Company has not  declared or paid any  dividends  to the holders of
its Common Stock, Series A Preferred Stock or Series B Preferred Stock.


                                   MANAGEMENT

         Directors, Executive Officers and Other Key Employees.

         The Company's  directors,  executive  officers and key  employees,  and
their  respective  ages and positions  with the Company,  are set forth below in
tabular form. Biographical information on each person is set forth following the
tabular  information.  There  are no  family  relationships  between  any of the
Company's  directors  or  executive  officers,   with  the  exception  of  Lance
D'Ambrosio  and  Troy  D'Ambrosio,  who are  brothers.  The  Company's  board of
directors is currently comprised of three members, each of whom is elected for a
term of one year.  Executive  officers are chosen by and serve at the discretion
of the board of directors.


Person                     Age                 Position
------                     ---                 --------
Lance D'Ambrosio           40                  President and Director

Paul Gadzinski             42                  Executive Vice President

Donald Williams            36                  Vice President of Latin
                                               American Operations and
                                               Director

Anthony Sansone            32                  Secretary and Treasurer

Troy D'Ambrosio            36                  Director

George Sorenson            41                  Director



         Lance D'Ambrosio -- Mr. D'Ambrosio is the President and Director of the
Company,  and holds  other  executive  officer  and  director  positions  in the
Company's  subsidiaries  and affiliates.  Mr.  D'Ambrosio is responsible for the
Company's  acquisitions,  strategic planning and mergers, and is responsible for
all financing plans for the Company. Since 1992 Mr. D'Ambrosio has served as the
President,  Chief  Executive  Officer  and a Director  of TTI,  has acted as the
President and a Director of WHI and has held executive  offices and/or  director
positions in WHI's  subsidiaries.  Between 1987 and 1992, Mr. D'Ambrosio was the
President  of  Bridgeport  Financial,  Inc., a holding  company that  acquired a
full-service  broker/dealer  securities  operation.   During  this  period,  Mr.
D'Ambrosio  was also the  President  of First  Eagle  Investment,  a  securities
broker/dealer.  He was also President of Tri-Bradley  Investments of Utah, which
was primarily  involved in raising  venture capital for investments in high-tech
companies. Mr. D'Ambrosio

                                       38

<PAGE>



holds a Bachelor of Science in Marketing and  Management  from the University of
Utah, which he received in 1979.

         Paul Gadzinski -- Mr.  Gadzinski is the Executive Vice President of the
Company.  Since 1994, Mr. Gadzinski has also served as Vice President for Market
Development for TTI and as Vice President of Marketing for WHI. Between 1989 and
1994,  Mr.  Gadzinski  served as Director  of  Marketing,  and was  subsequently
promoted to Vice President and General Manager, of Cross-Country Wireless Cable,
a 40,000 plus subscriber wireless cable system located in Riverside, California,
that recently was acquired by Pacific Telesis Group.  Between 1985 and 1989, Mr.
Gadzinski  was the  Marketing  Director and  Operations  Manager of Cable Vision
International,  a traditional cable operation  located in Luquillo,  Puerto Rico
(which  now does  business  as TCI  Cable  Vision  of Puerto  Rico,  Inc.).  Mr.
Gadzinski received an Associate of Arts degree in Small Business Management from
Santiago Community College.

         Donald  Williams  -- Mr.  Williams  joined the  Company in 1997 as Vice
President  of Latin  American  Operations  and also  serves as a  Director.  Mr.
Williams has six years of senior management and wireless communications business
development   experience   in  Venezuela.   In  1992,   Mr.   Williams   founded
Comunicaciones  Centurion,  S.A., and applied for and was granted the concession
for the 28 GHz frequency band for Venezuela.  In 1990, Mr.  Williams  co-founded
CARESA, a technical systems integrator and manufacturer's  representative to the
Venezuelan petroleum industry located in Maracaibo, Venezuela. Mr. Williams took
his university training in the United States and England.

         Anthony  Sansone -- Mr.  Sansone is the  Secretary and Treasurer of the
Company and serves as its  Controller.  Mr.  Sansone is also the  Treasurer  and
Controller of TTI and has served as a director of WHI. During 1993 and 1994, Mr.
Sansone was the Controller,  Secretary and the Director of Shareholder Relations
for Paradigm  Medical  Industries,  Inc., a public  manufacturer  of  ophthalmic
cataract removal devices.  During 1992 and 1993, he was the Assistant Controller
of HGM Medical Lasers,  Inc.,  which  manufactures and sells surgical and dental
lasers.  Between  1988 and  1992,  Mr.  Sansone  was the  Assistant  to the Vice
President of Public  Relations and the Assistant to the Chairman of the Board of
Directors  for American  Stores  Company,  a large retail  grocery and drugstore
chain. Mr. Sansone received a Bachelor of Science degree in Accounting from Utah
State University in 1988 and a Master of Business Administration degree from the
University of Utah in 1991.

         Troy D'Ambrosio -- Mr. D'Ambrosio is a Director of the Company and also
served as a Director of TTI. Mr. D'Ambrosio is the Manager of Customer Relations
for Wasatch  Advisors,  a mutual fund and investment  services  entity.  Between
November of 1993 and September of 1996, Mr. D'Ambrosio held executive  positions
in TTI,  where he served as Vice  President of  Administration,  Secretary and a
Director,  and also served in executive  positions  and as a director of WHI and
its subsidiaries.  Between July of 1992 and November of 1993, Mr. D'Ambrosio was
a Vice President and a partner in a public relations firm specializing in legal,
economic and  government  relations  for  business.  Between 1985 and 1992,  Mr.
D'Ambrosio  was  with  American  Stores,  most  recently  as Vice  President  of
Corporate Communications and Government Relations.

                                       39

<PAGE>



Mr. D'Ambrosio  received a Bachelor of Arts degree in Political Science from the
University of Utah in 1982.

         George  Sorenson -- Mr.  Sorenson is a Director of the Company and also
served as a Director of TTI.  Mr.  Sorenson is a  Principal  in FondElec  Group,
Inc.,  which invests in energy and electricity  markets in Latin  American,  and
advises United States  corporations on their investments in that area.  FondElec
is also a 45%  shareholder in LatinCom.  Between 1990 and 1992, Mr. Sorenson was
the  Associate  Director of Bear,  Sterns & Co., Inc.  where he was  principally
responsible  for  its  international  investment  banking  in the far  east  and
coordinated  product  development,  marketing and account  coverage for Japanese
accounts in New York and Tokyo.  Between 1983 and 1990, Mr.  Sorenson worked for
Drexel  Burnham & Lambert,  Inc.,  most  recently as a Senior Vice  President in
Tokyo, Japan, where he managed the company's high yield bond operations in Asia.
Mr.  Sorenson  received a Bachelor of Arts degree in Finance from the University
of Utah in 1979 and a Masters in International  Business Management in 1981 from
the American Graduate School of International Management.

         The Board of Directors  currently has no  committees,  but  anticipates
that it will form three standing committees:  the Executive Committee, the Audit
Committee,  and the  Compensation  Committee.  The Executive  Committee  will be
vested with the  authority to manage the  Company's  affairs  between  scheduled
meetings  of the Board of  Directors.  The  Audit  Committee  will be  primarily
charged  with the review of  professional  services  provided  by the  Company's
independent  auditors,  the  determination of the independence of such auditors,
the annual  financial  statements  of the  Company and the  Company's  system of
internal  accounting  controls.  The Audit Committee will also review such other
matters  with  respect  to the  accounting,  auditing  and  financial  reporting
practices and procedures of the Company as it may find  appropriate or as may be
brought to its attention.  The  Compensation  Committee will be charged with the
responsibility of reviewing executive salaries, administering bonuses, incentive
compensation  and stock option plans of the Company,  and approving the salaries
and other benefits of the executive  officers of the Company.  The  Compensation
Committee will also consult with the Company's  management regarding pension and
other benefit plans,  and the Company's  compensation  policies and practices in
general.

Director Compensation

         Directors do not receive cash  compensation for serving on the Board of
Directors or any committee of the Board,  or for any other services  rendered to
the Company,  but are  reimbursed  for expenses  they incur in  connection  with
attending Board or committee meetings.

Executive Compensation

         During the  Company's  fiscal  years ended  December 31, 1995 and 1996,
none  of the  Company's  executive  officers  received  any  cash  compensation,
bonuses,  stock appreciation  rights,  long-term  compensation,  stock awards or
long-term  incentive  rights from the Company.  As set forth in the chart below,
however, during 1996 one of the Company's executive officers received

                                       40

<PAGE>



options  to  acquire  shares in TIC,  which  were  subsequently  assumed  by and
converted  into options to acquire  shares of the  Company's  Series A Preferred
Stock  in  connection  with  of the TIC  Transaction,  none of  which  has  been
exercised. The options were granted to the executive in exchange for services to
TIC. No executive  officers  received any stock options  during 1995 or 1996 for
services to the Company.  The options  assumed by the Company as part of the TIC
Transaction are as follows:

                        Number of
                        Securities             Exercise
                        Underlying               Price            Expiration
 Name                    Options               ($/Share)           Date(1)

Paul Gadzinski            39,962                $.0625               2001



         1 The options expire on the 5th anniversary of the date of their grant.

Employment Agreements

         On  August  15,  1997,  the  Company  had  entered  into an  employment
agreement with Donald Williams,  a former CVV principal for a one year period at
an annual  salary of  $102,857  plus  additional  payments  in  accordance  with
Venezuela law. In addition to base salary,  Mr.  Williams is entitled to receive
incentive bonuses,  as determined by the Company's board of directors,  standard
benefits  such as  health,  life  insurance,  and  reimbursement  of  reasonable
expenses  incurred on the  Company's  behalf.  In general,  the  contract may be
terminated  only for  cause,  which  is  defined  in the  agreement  as  willful
misconduct, fraud, misappropriation, embezzlement, and similar unlawful acts. In
addition, the Mr. Williams can terminate the contract on 180 days notice. If the
contract  is  terminated  without  cause,  Mr.  Williams  is entitled to receive
severance  pay in an  amount  equal  to the  lessor  of six  month's  pay or the
remaining amount due under the contract.  The Company  anticipates it will enter
into  additional  employment  agreements  with its  other  officers  in the near
future.

                 CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

         The  following  information   summarizes  certain  transactions  either
engaged in or proposed to be engaged in by the Company  involving  its executive
officers,  directors,  5%  stockholders  and immediate  family  members of those
persons:

LatinCom, Inc.

         The Company is an investor in LatinCom,  Inc.,  a Delaware  corporation
that  is  in  the  business  of  acquiring,   owning  and   operating   wireless
communications systems in Peru, Brazil and Mexico (the "LatinCom Markets").  The
Company  holds a 45% interest in LatinCom,  and the remaining 55% is held 45% by
FondElec,  8% by certain officers and directors of the Company and 2% by a third
party. The 10% not held by the Company or FondElec is non-dilutable.  One of the
members of the Company's board of directors is a principal of FondElec.

                                       41

<PAGE>




         The  Company  and   FondElec   formed   LatinCom  for  the  purpose  of
capitalizing  on certain  proprietary  relationships,  contracts and information
relating to the wireless communications industry that were developed by FondElec
in the LatinCom  markets.  The Company and FondElec  believed that, by combining
FondElec's   proprietary   relationships  and  information  with  the  Company's
expertise in wireless  communications,  they could more easily and  economically
acquire and exploit wireless communication's rights in the LatinCom markets.

         Upon the  formation  of  LatinCom,  each of the  Company  and  FondElec
contributed  to LatinCom  their  interests  in certain  wireless  communications
development  activities and rights relating to the country of Peru. In addition,
both the Company and FondElec  have agreed to loan to LatinCom,  on a continuing
basis,  amounts sufficient to fund LatinCom's  operations.  In order to maintain
FondElec's and the Company's  equal  positions in LatinCom,  those loans will be
made 50% by FondElec and 50% by the Company.

         Currently,   the   Company   anticipates   that   LatinCom's   wireless
communications  development  activities  will be  contractually  limited  to its
development  activities in Peru,  Brazil and Mexico.  There can be no assurance,
however,   that  LatinCom  may  not  attempt  to  develop  or  acquire  wireless
communication  rights  in other  countries,  including  countries  in which  the
Company  has or may  acquire  wireless  communication's  rights  or  enter  into
negotiations  for those rights.  Further,  because  FondElec is a shareholder in
both the Company and  LatinCom,  and because the officers  and  directors of the
Company who own  interests in LatinCom  will also manage the  operations  of the
Company,  conflicts may arise between the interests of LatinCom and the Company.
There can be no assurance that those  conflicts will be resolved in favor of the
Company. The Company anticipates the shareholders of LatinCom will enter into an
agreement regarding their rights and duties as shareholders and which sets forth
certain  limitations  and  restrictions  on the transfer or encumbrance of their
interests and the scope of LatinCom's  business operations and market areas. The
Company  further  anticipates  that the agreement will contain and be subject to
other provisions normally found in shareholder agreements.

Services Agreement.

         On  January  1,  1997,  TIC  entered  into a  services  agreement  with
Bridgeport  Financial,  Inc. The principal of Bridgeport Financial is the father
of Lance D'Ambrosio and Troy D'Ambrosio,  officers and directors of the Company.
Under the terms of the agreement,  TIC retained Bridgeport  Financial to provide
TIC with  certain  advisory  and other  services  relating  to the  acquisition,
ownership  and  operation  of  wireless  cable  television,  telephony  and data
transmission  services  in  Central  and South  America,  Europe  and  Asia.  In
consideration for these services,  TIC agreed to pay Bridgeport Financial,  on a
continuing basis and in arrears, an amount equal to (i) two percent of the first
$50 million of TIC's gross annual revenues,  and (ii) one percent of TIC's gross
annual  revenues in excess of $50 million from all sources.  The minimum  amount
payable  to  Bridgeport  Financial  in the  first  contract  year,  however,  is
$150,000.  The amounts  payable with respect to the first  contract year are due
and payable upon the earlier of 15 days after the end of the contract  year,  or
five days after the receipt by TIC or its  successors  of the  proceeds  from an
equity or debt  financing  of at least $3 million.  Thereafter,  the amounts due
Bridgeport

                                       42

<PAGE>



Financial  under the agreement are due and payable  within 15 days of the end of
each month.  For  purposes  of  calculating  the amounts due under the  services
agreement,  the gross annual  revenues of TIC include all of the revenues of its
parent or  subsidiaries,  and its parent's  subsidiaries,  provided  that if any
subsidiary is not held 100% by TIC or its parent, the revenue of that subsidiary
is  attributed  to TIC only to the extent of TIC's or its parent's  ownership of
that  subsidiary.  The  agreement  contains a specific  exclusion  for any gross
revenues attributed to TIC from the operations of wireless  communication rights
in New Zealand.

         The  term  of  the  services   agreement  is  for  five  years  and  it
automatically  renews for  successive  periods of one year unless  either  party
notifies the other of its  election not to renew the  agreement at least 60 days
before the end of the current term.  The agreement may be terminated at any time
by TIC in the event of any occurrence of TIC's  cessation of its active business
operations, Bridgeport Financial's failure or refusal to perform the services in
accordance  with the terms of the  agreement,  if  Bridgeport  Financial  or its
principal is charged with or convicted of any felony,  if  Bridgeport  Financial
breaches its duties or  obligations  under the agreement and fails or refuses to
correct  that  breach  within 10 days after  written  notice by TIC, or upon the
issuance  of  any  final  binding  order  of  a  governmental  authority  having
jurisdiction  rendering  the  agreement  invalid  or  unenforceable.  Bridgeport
Financial  may terminate the agreement at any time if TIC breaches its duties or
obligations  under the  agreement  and fails or refuses  to  correct  any breach
within 10 days after written notice.

         The  services  agreement  also  contains  provisions  pursuant to which
Bridgeport  Financial  acknowledges  and agrees that all  customer  accounts for
which Bridgeport  Financial  provides  services under the agreement are the sole
and  exclusive  customers,  accounts and  proprietary  contacts of TIC and that,
during  the  term of the  agreement  and for a  period  of one  year  after  its
termination, Bridgeport Financial will not enter into any business operations in
direct or indirect competition with the business of TIC or in any current market
of TIC. The Services  Agreement  replaces a prior agreement  between  Bridgeport
Financial  and  TIC,  pursuant  to which  TIC was  obligated  to pay  Bridgeport
Financial  the sum of $5,000 per month.  The Services  Agreement is binding upon
any successor or assignee of TIC and, as a result of the merger  between TIC and
the Company's  wholly-owned  subsidiary,  NewWCCI,  Inc.,  the provisions of the
Services  Agreement  will  apply to the gross  revenues  generated  by TIC,  the
Company and their respective  subsidiaries.  A copy of the services agreement is
attached hereto as Exhibit 10.6.

TIC Transaction

         In February, 1997, the Company's wholly-owned subsidiary, NewWCCI, Inc.
merged with and into TIC. TIC was the surviving entity in the transaction. For a
more detailed  description of the merger,  see the section  entitled  "Business"
above.

         A  number  of the  shareholders  of TIC  also  serve  as  officers  and
directors of the Company. In addition, the father of the Company's president was
the majority shareholder of TIC and, as a result of a TIC Transaction, currently
holds a majority of the  Company's  voting  power on a common  stock  equivalent
basis. See "Principal Stockholders" below.

                                       43

<PAGE>




CVV Transaction

         In August, 1997, the Company acquired a 68.14% interest in CVV in which
an officer of the  Company was a former  principal  owner.  For a more  detailed
description of the  acquisition,  see the section entitled  "Operating  Systems"
above.

                             PRINCIPAL STOCKHOLDERS

         As a result  of the TIC  Transaction  in  February,  1997,  the  former
stockholders  in TIC acquired a  significant  portion of the voting power of the
Company.  The CVV  Transaction  in August 1997 also affected the voting power of
the Company.  The TIC Transaction and CVV Transaction  took place  subsequent to
the end of the  Company's  fiscal  year  (December  31,  1996).  Because  of the
significance of the changes in the identity and percentage  ownership  rights of
the Company's  principal  stockholders  resulting from these  transactions,  the
following  table sets forth the  beneficial  ownership of the  Company's  Common
Stock, Series A Preferred Stock and Series B Preferred Stock at August 15, 1997.
The table  describes the  beneficial  ownership of the  Company's  Common Stock,
Series A Preferred  Stock and Series B Preferred  Stock by (i) each  stockholder
known  by  the  Company  to be the  beneficial  owner  of  more  than  5% of the
outstanding  shares of Common Stock,  (ii) each  director,  (iii) each executive
officer  and  (iv) all  directors  and  executive  officers  as a group.  Unless
otherwise indicated,  each such person (alone or with family members) has voting
and  dispositive  power of the shares listed  opposite such person's  name.  The
offices  and  positions  shown in  parentheses  after the name of certain of the
persons  shown  below  state the current  offices  and  positions  held by those
persons in the  Company's  management.  Unless  otherwise  indicated,  each such
person  (either alone or with family  members) has been deemed to have authority
or dispositive power of the shares listed:







                      [THIS SPACE INTENTIONALLY LEFT BLANK]

                                       44

<PAGE>




<TABLE>
<CAPTION>

                            Shares Owned Beneficially

                 <S>                     <C>                  <C>             <C>
                                                                              Percent of
                 Name                    Class                Number            Class1

Lance D'Ambrosio                         Common                  290,5332        5.56%
(President, Director)                    Series A
3276 E. Almira Court                     Preferred               359,6602       15.00%
Salt Lake City, Utah

Troy D'Ambrosio                          Common                    33,096         *
(Director)                               Series A
2914 Nila Way                            Preferred                199,811        8.33%
Salt Lake City, Utah

Paul Gadzinski                           Common                    24,249         *
(Executive V.P.)                         Series A
6649 Wintertree Dr.                      Preferred                39,9625        1.67%
Riverside, California

Donald Williams                          Common                  855,5566       16.38%
(V.P. Latin America Ops)                 Series B
7 Winter Wheat                           Preferred               192,5006       54.25%
The Woodlands, Texas

Anthony Sansone                          Common                     4,850         *
(Secretary/Treasurer)                    Series A
3692 South 645 East                      Preferred                 39,963        1.67%
Salt Lake City, Utah

George Sorenson                          Common                   14,1454         *
(Director)
12 Fairgreen Lane
Old Greenwich, Connecticut

George D'Ambrosio                        Common                   471,291        9.02%
5451 South 1410 East                     Series A
Salt Lake City, Utah                     Preferred              1,192,872       49.75%

FondElec Group, Inc.                     Series A
333 Ludlow Street                        Preferred                359,660       15.00%
Stamford, Connecticut

All directors and officers as a          Common                 1,222,429       23.41%
group (5 persons)                        Series A
                                         Preferred                639,396       26.67%
                                         Series B
                                         Preferred                192,500       54.25%


*Less than 1%
<FN>

         1 Assumes 5,222,833  outstanding  shares of Common Stock,  2,397,732  outstanding  shares of Series A Preferred
Stock and  354,825  outstanding  shares of Series B Preferred  Stock.  Does not assume the  exercise of any  outstanding
options or the exercise of any  warrants  issued in  connection  with the  placement  by the Company of certain  secured
promissory notes. See "Management's Discussion and Analysis of Certain Relevant Factors" and "Market Price and Dividends
on the Registrant's Common Equity and Other Shareholder Matters."



                                       45

<PAGE>



         2 Includes  shares held in the name of Mr.  D'Ambrosio  and shares held in the name of entities  over which Mr.
D'Ambrosio has voting and/or beneficial control and for which he does not disclaim beneficial ownership.

         3 Includes shares held in the name of Mr. D'Ambrosio and held in the name of entities over which Mr. D'Ambrosio
has voting and/or  beneficial  control and for which he does not disclaim  beneficial  ownership.  Mr. D'Ambrosio is the
father of Lance D'Ambrosio and Troy D'Ambrosio.

         4 Mr. Sorenson is also a principal of FondElec Group, Inc. Mr. Sorenson  disclaims  beneficial  interest in the
shares held by FondElec Group, Inc. and SC Tampa, Inc.

         5 Includes options to acquire 39,962 shares of Series A Preferred Stock, none of which have been exercised.

         6 Under the terms of the Company's  acquisition of its interest in CVV, Caribbean  Comunicaciones Group and Mr.
Williams acquired equity securities of the Company.  Mr. Williams is a principal of Caribbean  Comunicaciones  Group but
disclaims beneficial interest in the shares held by Caribbean Comunicaciones Group.
</FN>
</TABLE>

                     MANAGEMENT'S DISCUSSION AND ANALYSIS OF
                            CERTAIN RELEVANT FACTORS

         The  following  information  should  be read in  conjunction  with  the
Consolidated  Financial  Statements  and Notes  thereto and the other  financial
information appearing elsewhere in this report.

Overview

         The Company is in the business of acquiring,  developing  and operating
wireless  communications  systems,  primarily through interests in operating and
development  companies  conducting  business in Latin and South  America and New
Zealand.  The Company  currently has, or has the right to acquire,  interests in
wireless  communications  systems or channel right groupings in five markets. As
of  March 1,  1996,  one of  these  market  areas  has an  established  wireless
communications commercial operation.

         The Company owns or has entered  into  letters of intent or  agreements
giving it the right to acquire a 92.5% interest in the licensee of the rights to
the 27.5 to 29.5 GHz  frequency  bands in Costa Rica, a 70% interest in the 27.5
to 28.5 GHz frequency bands in Guatemala (and the right to acquire an additional
10% interest),  a 90% interest in the licensee of the 27.5 to 29.5 GHz frequency
bands in Panama,  a 94.9%  interest in the licensee of four  channels in the 2.5
GHz frequency band and channels in the 40 GHz frequency band in New Zealand, and
an 8.5%  interest  (as of July 31, 1997) in the licensee of the 27.5 to 29.5 GHz
frequency  bands in  Venezuela.  The  Company  owns  68.14% of the lessee of the
Venezuelan licenses and has the right to acquire an additional 10%. Further, the
Company owns a 45% interest in LatinCom,  Inc., a Delaware  corporation  that is
negotiating  with  various  wireless  communications  right  holders  in Mexico,
Brazil, and Peru.

         The Company  generally  invests in non-operating  wireless  projects or
channel right groupings in under-developed  countries.  Those projects typically
have neither cash flow nor revenue to support  operating costs,  working capital
or capital expenditures. In addition, when any such projects become operational,
and to the extent they  generate  positive  cash flow,  the  continuing  capital
investment required to satisfy the requirements of those projects (as well as

                                       46

<PAGE>



increasing operating expenses and working capital requirements) typically result
in little or no excess funds being available for  distribution to  shareholders.
As  a  result,  the  Company   anticipates  that  its  operating  companies  and
development  stage  companies  will not pay any  cash  dividends  or other  cash
distributions to the Company in the near future.

         Since its inception,  the Company has sustained net losses and negative
cash  flow,  due  primarily  to  start-up   costs,   expenses  and  charges  for
depreciation and amortization of capital expenditures and other costs related to
its  acquisition  and  development  of its wireless  communications  systems and
license rights. The Company expects to continue to experience negative cash flow
through at least 1997,  and may  continue to do so after it develops and expands
its wireless  communications  systems, even if individual systems of the Company
become profitable and generate positive cash flow. Unless the Company is able to
generate  sufficient  revenue or acquire  significant  additional debt or equity
financing  to cover its  present and ongoing  operation  costs and  liabilities,
there is substantial doubt about its ability to continue as a going concern.

         The Company's  assets  consist  primarily of two groups -- those assets
the Company acquired as a result of the Separation, and those it acquired in its
recent transaction with TIC. The financial  statements  included as part of this
report as described  in this  section  include  audited  consolidated  financial
statements for the year ended December 31, 1996 and for the period from July 31,
1995 (date of inception) through December 31, 1995. Due to the Company's limited
history  and  recent  acquisitions,  it is  the  opinion  of  management  that a
year-to-year  comparison  of  revenues  and  expenses  is not  meaningful  to an
understanding of the Company's operations.

         For the 12 months ended December 31, 1996, the Company had no revenues,
but  incurred  total  expenses of $715,561.  These  expenses  were  comprised of
$247,915 in  professional  fees,  $2,600 in depreciation  expenses,  $308,195 in
amortization  expenses  and lease  expenses  which are  directly  related to the
Company's New Zealand  wireless  assets,  $78,134 in general and  administrative
expenses,  and  $78,717  in  interest  expense  relating  to a  loan  commitment
agreement between the Company and TTI, as described below. The total expenses of
$715,561  were  reduced by minority  interest in the loss of the  Company's  New
Zealand assets of $17,607, to arrive at the total net loss of $697,954.

         For the 5 months ended  December 31, 1995, the Company had no revenues,
but  incurred  total  expenses of $161,703.  These  expenses  were  comprised of
$17,935 in  professional  fees,  $1,085 in  depreciation  expenses,  $128,921 in
amortization  expenses  and lease  expenses  which are  directly  related to the
Company's New Zealand assets, $7,323 in general and administrative  expenses and
$6,439 in interest  expense related to the loan  commitment  between TTI and the
Company. The total expenses of $161,703 were reduced by minority interest in the
loss of the Company's New Zealand  assets of $6,575,  to arrive at the total net
loss of $155,128.

         Liquidity and Capital  Resources.  At December 31, 1996,  the Company's
current  liabilities  exceeded  its current  assets by $199,786.  The  Company's
business  operations will require  substantial capital financing on a continuing
basis. The availability of that financing will

                                       47

<PAGE>



be essential to the Company's continued operation and expansion. There can be no
assurances,  however,  that the  Company  will be able to  acquire  or  generate
sufficient  capital to build-out  its existing  channel  rights or acquire other
channel rights (in operating systems or otherwise). Further, the Company expects
to incur net losses for the foreseeable future, although it anticipates that its
individual   systems  may  generate   positive   monthly   operating  cash  flow
approximately 24 to 36 months after start up.

         As of December  31, 1996,  the Company had current  assets of $245,437,
compared to $203,037 as of December  31, 1995,  for an increase of $42,400.  The
increase in current  assets was primarily due to an increase in cash as a result
of increased  borrowing.  The Company invested $440,000 in a Venezuelan  license
company  during the year ended  December  31,  1996.  License  rights  decreased
$169,166  from  $1,092,333  as of December  31, 1995 to $923,167 at December 31,
1996 due to  amortization  expense.  The Company  also made loans to TIC,  which
subsequently merged with and into a subsidiary of the Company in connection with
the TIC  Transaction,  in the amount of $120,234  during the year ended December
31, 1996.

         The Company had current liabilities of $445,223 as of December 31, 1996
compared to $218,851 as of December 31, 1995,  for an increase of $226,372.  The
increase in current  liabilities  was due to an  increase  in  accounts  payable
relating  to start up  expenses.  Minority  interest in  subsidiaries  decreased
$17,607 from $49,612 as of December 31, 1995 to $32,005 at December 31, 1996 due
to minority  interest in loss of subsidiary.  Long term debt increased  $880,602
from  $238,406 at December 31, 1995 to  $1,119,008  at December  31,  1996.  The
increase  was due to  additional  advances  by  TTI,  and  the  related  accrued
interest,  under the terms of a loan  commitment as described  below,  and loans
from a third party.  Common stock and  additional  paid in capital  increased by
$1,458 and  $37,997,  respectively,  between  December 31, 1995 and December 31,
1996,  due to the June 1996 issuance of 145,833  shares of the Company's  Common
Stock for $1,600 in cash.

         The Company anticipates that it will obtain financing necessary to fund
its future operations through loans,  equity investments and other transactions.
While there can be no assurance  that the Company will secure such funding,  the
Company is currently in negotiations to obtain third-party  financing of between
$500,000 and  $20,000,000  for its activities  and management  believes (but can
give no assurances)  that this funding can be obtained under terms  satisfactory
to the Company.  The Company  anticipates that such funding would be in the form
of secured or unsecured  loans and/or equity  investments.  The terms and mix of
any such  funding  will be  contingent  on a number of  factors,  including  the
proportion  of the funding that takes the form of secured debt (versus  equity),
the type of security  interest the Company is able to provide the third  parties
if the funding is structured as a secured loan, the prevailing interest rates at
the time of that funding,  the third party's other investment  opportunities and
other factors, some or all of which may be beyond the control of the Company. In
the event the Company is unsuccessful in completing these financing arrangements
or in obtaining substitute  financing or funding commitments,  the Company would
have  difficulty in meeting its operating  expenses,  satisfying its existing or
future debt obligations, or succeeding in acquiring, developing or operating its
wireless  communications  systems or adding subscribers to such systems.  If the
Company does

                                       48

<PAGE>



not have  sufficient  cash  flow or is  unable  otherwise  to  satisfy  its debt
obligations,  its  ongoing  growth and  operations  could be  restricted  or the
viability of the Company could be materially and adversely affected.

         The Company has taken  several  actions  which it believes will improve
its short term and  ongoing  liquidity  and cash  flow.  These  actions  include
establishing  policies designed to conserve cash and control costs, and pursuing
additional financing and capital resources, as described herein.

         In early 1997,  subsequent  to the period  covered by this report,  the
Company offered to certain investors  secured  promissory notes in the aggregate
principal amount of $1,600,000,  together with warrants to acquire shares of the
Company's  common  stock.  The  offering  was  subject  to no  minimum or escrow
provisions,  although  the  minimum  subscription  per  investor  was $50,000 in
principal  amount (subject to the Company's  discretion to accept  subscriptions
for lower principal  amounts from any individual  investor).  Through August 15,
1997, the Company sold $850,000 in principal amounts of these secured promissory
notes.

         The offerees of the secured promissory notes were accredited investors,
as that term is defined in Regulation D promulgated  under the Securities Act of
1933, as amended.  At the election of the Company, it also reserved the right to
sell the secured  promissory notes and warrants to up to 35 persons who were not
accredited  investors.  The secured promissory notes and warrants were placed by
the Company's officers and directors on a best efforts basis.

         The amounts due under the secured promissory notes bear interest at the
rate of nine percent (9%) per annum and,  subject to the terms of the  documents
relating  to  the  issuance  of  the  secured   promissory   notes   related  to
acceleration,  are due on January  31,  2002.  All  interest  under the  secured
promissory notes is to be paid semiannually on each June 30 and December 31.

         The secured  promissory  notes are secured by a pledge of the Company's
interests in its New Zealand and Venezuelan wireless communication's rights, its
interest in LatinCom and by the pledge by certain of the Company's  shareholders
of their shares in the  Company.  The  Company's  largest  shareholder  has also
granted the holders of the secured  promissory  notes a proxy to vote his shares
in the  Company  in the  event of a default  by the  Company  under the  secured
promissory notes.

         The holders of the secured promissory notes will also receive the right
to acquire from the Company,  at any time and from time to time through  January
31, 2002,  shares of the Company's common stock at a purchase price equal to the
"purchase  price"  as that  term  is  defined  in the  secured  promissory  note
documents.  The warrants  allow the holders of the secured  promissory  notes to
acquire, in the aggregate,  shares of the Company's common stock at the Purchase
Price having an accurate  value of  $1,600,000  (assuming the purchase of all of
the secured  promissory  notes offered by the  Company).  Under the terms of the
warrants,  the warrant holders will be protected from certain types of dilution.
The Company has also granted the holders of any shares acquired  pursuant to the
warrants certain demand and "piggyback" registration rights. Subject to

                                       49

<PAGE>



the limitations set forth in the  Registration  Rights  Agreement,  those rights
allow the  holders  of the  shares  acquired  pursuant  to the  exercise  of the
warrants  to include  those  shares in a  registration  statement  relating to a
registered public offering of the Company's common stock.

         On August 4, 1997, the Company  borrowed  $2,100,000 from a third party
investor.  The loan bears  interest at 10%, is  unsecured,  and is payable  with
accrued interest on December 31, 1997. The Company has used $200,000 of the loan
proceeds to exercise its option to purchase 68.14% of the outstanding  shares of
CVV and intends to use  $800,000 to exercise its option in Venezuela to purchase
an  additional  10% of CVV,  to pay  for  equipment  and  start-up  expenses  in
Venezuela and Guatemala of $579,850,  and to pay outstanding accounts payable of
$496,784.

         The Company has also borrowed  funds under a loan  commitment  from TTI
(the  "Commitment").  Under the terms of the Commitment,  TTI agreed to loan the
Company up to  $1,000,000,  which will be repaid,  together with interest at the
rate of 8% per annum, on August 1, 2001. At the Company's option,  however,  its
obligations  to TTI  may be  converted  into a term  loan  (payable  in  monthly
payments of principal  and  interest)  with a maturity date of 10 years from the
first day of the month  following  the  conversion  if (i) the Company is not in
default  under the  Commitment,  (ii) there has been no  material  change in the
Company's financial  condition which TTI reasonably  determines to be materially
adverse to the Company or which materially  increases TTI's risk of non-payment,
(iii) the construction  and build-out of the Company's  systems are, in the sole
opinion of TTI, occurring in accordance with the projected schedule agreed to by
the  parties,  and (iv) the Company  provides  TTI with  certain  documentation,
including  information  regarding the uses of the amounts  advanced by TTI under
the Commitment.

         The  amounts  advanced  under the  Commitment  may be used only for (i)
acquiring,  owning,  building out and operating wireless  communications systems
and  operations  and (ii) the  payment  of  general  administrative  and  office
expenses  incurred by the Company in connection  with those  operations,  all in
accordance with the budget to be agreed upon by the parties. No amounts advanced
under the  Commitment  may be used for  general  investment  purposes  unless an
investment is for a period of not more than 30 days and pending the  expenditure
of those funds in question  for  approved  purposes.  At the request of TTI, the
Company  has  agreed  to grant it a  security  interest  in all or a part of its
assets to secure the Company's repayment  obligations.  As of December 31, 1996,
$996,707 plus accrued interest of $47,301 was outstanding under the Commitment.


PART II

                 MARKET PRICE AND DIVIDENDS ON THE REGISTRANT'S
                   COMMON EQUITY AND OTHER SHAREHOLDER MATTERS

         There has been no  established  public  market for the Common  Stock or
Series A Preferred Stock or Series B Preferred Stock of the Company. The Company
cannot predict the effect,  if any, that future sales of shares of common stock,
Series A Preferred Stock, or Series B Preferred

                                       50

<PAGE>



Stock or the  availability  of such shares for sale,  will have any market price
prevailing from time to time on the Company's equity securities. Future sales of
substantial  amounts of stock  (whether  common or  preferred)  could  adversely
affect  the  prevailing  market  prices  of  the  Company's  outstanding  equity
securities.

         All of the  currently  issued and  outstanding  shares of the Company's
Common Stock,  Series A Preferred Stock and Series B Preferred Stock were issued
by the Company in transactions which the Company believes did not involve public
offerings.  All 3,500,000  shares of Common Stock issued in connection  with the
Separation,  are freely tradable, but all other shares of common stock, Series A
Preferred  Stock  and  Series  B  Preferred  Stock  currently   outstanding  are
"restricted securities," as that term is defined in the federal securities laws,
and may not be resold unless  registered  under the  Securities  Act of 1933, as
amended, or sold in connection with an exemption therefrom.  All or a portion of
the restricted  shares may in the future become  eligible for sale in the public
marketplace  in  reliance  on  Rule  144,   subject  to  the  volume  and  other
restrictions contained therein.

         The secured  promissory  notes and warrants offered by the Company were
also not registered  under the federal or state securities laws in reliance upon
exemptions  from  registration  contained in those laws. The secured  promissory
notes and the warrants constitute "restricted  securities" and may not be resold
unless  registered  under the  Securities  Act of 1933,  as amended,  or sold in
connection with an exemption therefrom.

           CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING
                            AND FINANCIAL DISCLOSURE

         On September 5, 1996,  Deloitte & Touche LLP replaced  Jones,  Jensen &
Co. as independent  certified  public  accountants  for the Company for the year
ending December 31, 1995.  Jones,  Jensen & Co.'s  relationship with the Company
was not  terminated  because of any resolved or unresolved  disagreement  on any
matter of accounting principles or practices,  financial statement disclosure or
auditing scope or procedure.

         The  decision  to change the  Company's  independent  accountants  from
Jones, Jensen & Co. to Deloitte & Touche LLP was recommended and approved by the
Company's Board of Directors.

                COMPLIANCE WITH SECTION 16(a) OF THE EXCHANGE ACT

         Paragraph  16(a) of the Securities  Exchange Act of 1934 (the "Exchange
Act") requires the Company's  executive officers and directors,  and persons who
own  10% or  more of a  registered  class  of the  Company's  equity  securities
(collectively, "Reporting Persons"), to file reports of ownership and changes in
ownership  with the  Securities  and Exchange  Commission if the Company and its
equity  securities  meet certain  requirements.  The Company has not received or
reviewed any filings under Section 16(a) for any Reporting Person, including any
filing on Forms 3, 4 or 5. The persons  constituting  the Reporting  Persons are
described in the section entitled "Principle Stockholders."

                                       51

<PAGE>




                               REPORTS ON FORM 8-K

                                    None
PART F/S

         The following financial  information is provided in accordance with the
requirements of Item 310 of Regulation S-B.

INDEX TO FINANCIAL STATEMENTS


        Item                                                          Page

Independent Auditors' Report                                           53

Consolidated Balance Sheets                                            54

Consolidated Statements of Operations                                  55

Consolidated Statements of Stockholders' Equity (Deficit)              56

Consolidated Statements of Cash Flows                                  57

Notes to Consolidated Financial Statements                             58





                                       52

<PAGE>



INDEPENDENT AUDITORS' REPORT


To the Board of Directors
Wireless Cable & Communications, Inc.
Salt Lake City, Utah

We have audited the accompanying consolidated balance sheets of Wireless Cable &
Communications,  Inc.  and  subsidiaries  (a  development  stage  company)  (the
Company)  as of  December  31,  1996  and  1995,  and the  related  consolidated
statements  of  operations,  stockholders'  equity,  and cash flows for the year
ended  December  31,  1996  and for the  period  from  July  31,  1995  (date of
inception) to December 31, 1995,  and for the period from July 31, 1995 (date of
inception) to December 31, 1996. These consolidated financial statements are the
responsibility of the Company's management.  Our responsibility is to express an
opinion on these consolidated 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,  such consolidated  financial  statements present fairly, in all
material  respects,  the  consolidated  financial  position  of the  Company  at
December 31, 1996 and 1995,  and the results of their  operations and their cash
flows for the year ended December 31, 1996 and for the period from July 31, 1995
(date of inception) to December 31, 1995,  and for the period from July 31, 1995
(date of inception) to December 31, 1996, in conformity with generally  accepted
accounting principles.

The accompanying  consolidated  financial statements have been prepared assuming
that the Company will continue as a going concern.  The Company is a development
stage  enterprise  engaged in the  development  of  wireless  telecommunications
systems both  domestically  and  internationally.  As discussed in Note 1 to the
consolidated financial statements,  the Company does not have revenue sufficient
to cover its operating costs, its current liabilities exceed its current assets,
and the Company has incurred  losses since  inception.  These  conditions  raise
substantial doubt about its ability to continue as a going concern. Management's
plans  concerning  these matters are also described in Note 1. The  consolidated
financial  statements do not include any adjustments  that might result from the
outcome of these uncertainties.



DELOITTE & TOUCHE LLP

Salt Lake City, Utah
March 24, 1997
(August 15, 1997 as to notes 7 and 8)

                                       53

<PAGE>
<TABLE>
<CAPTION>

WIRELESS CABLE & COMMUNICATIONS, INC.
AND SUBSIDIARIES
(A DEVELOPMENT STAGE COMPANY)

CONSOLIDATED BALANCE SHEETS
DECEMBER 31, 1996 AND 1995

<S>                                                                        <C>                   <C>


                                                                             December 31,        December 31, 1995
                                                                                 1996
ASSETS
CURRENT ASSETS:
  Cash                                                                      $         77,991       $          2,075
  Prepaid license lease fees (Notes 2 and 3)                                         167,446                200,962
                                                                           ------------------    -------------------
         Total current assets                                                        245,437                203,037
INVESTMENT IN CENTURION (Note 2)                                                     440,000                      -
EQUIPMENT - Net (Note 2)                                                                 433                  3,033

OTHER RECEIVABLES (receivable from related party, Note 4)                            120,234                      -

LICENSE RIGHTS - Net (Note 3)                                                        923,167              1,092,333
                                                                           ------------------    -------------------
TOTAL ASSETS (Note 6)                                                           $  1,729,271           $  1,298,403
                                                                           ==================    ===================

LIABILITIES AND STOCKHOLDERS' DEFICIT
CURRENT LIABILITIES:
  Accounts payable                                                           $       235,825        $        16,668
  Accrued license lease fees (Note 3)                                                109,398                102,183
  Accrued consulting fees (payable to related party, Note 4)                         100,000                100,000
                                                                           ------------------    -------------------
         Total current liabilities                                                   445,223                218,851
LONG-TERM LIABILITIES:
   Long-term debt (owed to related party, Note 4)                                  1,044,008                238,406
   Note payable (Note 6)                                                              75,000                      -
MINORITY INTEREST IN SUBSIDIARY (Note 1)                                              32,005                 49,612
                                                                           ------------------    -------------------
         Total liabilities                                                         1,596,236                506,869
                                                                           ------------------    -------------------
COMMITMENTS AND CONTINGENCIES (Notes 3, 4, 6 and 7)
STOCKHOLDERS' DEFICIT (Note 1):
  Preferred stock; $0.01 par value; 5,000,000 shares authorized:
    and no shares issued or outstanding
  Common stock; $0.01 par value; 15,000,000 shares authorized:
    3,645,833 and 3,500,000 shares issued and outstanding in
    1996 and 1995, respectively                                                       36,458                 35,000
  Additional paid-in capital                                                         949,659                911,662
  Deficit accumulated during the development stage                                 (853,082)              (155,128)
                                                                           ------------------    -------------------
         Total stockholders' deficit                                                 133,035                791,534
                                                                           ------------------    -------------------
TOTAL LIABILITIES AND STOCKHOLDERS' DEFICIT                                     $  1,729,271            $ 1,298,403
                                                                           ==================    ===================


See notes to consolidated financial statements.

</TABLE>

                                                        54

<PAGE>


<TABLE>
<CAPTION>

WIRELESS CABLE & COMMUNICATIONS, INC.
AND SUBSIDIARIES
(A DEVELOPMENT STAGE COMPANY)

CONSOLIDATED STATEMENTS OF OPERATIONS
FOR THE YEAR ENDED DECEMBER 31, 1996,
FROM JULY 31, 1995 (DATE OF INCEPTION) TO DECEMBER 31, 1995,
AND FROM JULY 31, 1995 (DATE OF INCEPTION) TO DECEMBER 31, 1996


<S>                                                           <C>                 <C>                  <C>
                                                                                   July 31, 1995        July 31, 1995
                                                                   Year               (Date of             (Date of
                                                                   Ended           Inception) To        Inception) To
                                                               December 31,         December 31,         December 31,
                                                                   1996                 1995                 1996
                                                              ----------------    -----------------    -----------------

REVENUES                                                                 NONE                 NONE                 NONE
                                                              ----------------    -----------------    -----------------
EXPENSES:
  Professional fees                                            $      247,915      $        17,935       $      265,850
  Depreciation and amortization (Note 2)                              171,766               73,585              245,351
  Lease expense (Note 3)                                              139,029               56,421              195,450
  General and administrative                                           78,134                7,323               85,457
                                                              ----------------    -----------------    -----------------
         Total                                                        636,844              155,264              792,108
INTEREST EXPENSE (Notes 4 and 6)                                       78,717                6,439               85,156
                                                              ----------------    -----------------    -----------------
NET LOSS BEFORE MINORITY INTEREST                                     715,561              161,703              877,264
MINORITY INTEREST IN LOSS OF SUBSIDIARY (Note 1)                       17,607                6,575               24,182
                                                              ----------------    -----------------    -----------------
NET LOSS                                                       $      697,954        $     155,128        $     853,082
                                                              ================    =================    =================

Net loss per common share                                      $        (0.20)       $       (0.04)

                                                              ================    =================

Weighted average common shares                                      3,574,112            3,500,000
                                                              ================    =================


See notes to consolidated financial statements.

</TABLE>





                                                        55

<PAGE>

<TABLE>
<CAPTION>


WIRELESS CABLE & COMMUNICATIONS, INC.
AND SUBSIDIARIES
(A DEVELOPMENT STAGE COMPANY)

CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY (DEFICIT)
FOR THE YEAR ENDED DECEMBER 31, 1996 AND
FROM JULY 31, 1995 (DATE OF INCEPTION) TO DECEMBER 31, 1995


<S>                                                 <C>              <C>             <C>             <C>
                                                                                                       Deficit
                                                                                      Additional      During the
                                                            CommonStock                 Paid-in      Development
                                                     Shares              Amount         Capital        Stage


Issuance of common stock to TTI
  shareholders in August 1995 (Note 1)                 3,500,000         $35,000        $911,662
Net loss for the period from July 31, 1995
  (date of inception) to December 31, 1995                                                               $(155,128)
                                                    -------------    ------------    ------------    ---------------
BALANCE, DECEMBER 31, 1995                             3,500,000          35,000         911,662          (155,128)
Issuance of common stock (Note 4)                        145,833           1,458          37,997
Net loss for the year ended December 31, 1996                                                             (697,954)
                                                    -------------    ------------    ------------    ---------------
BALANCE, DECEMBER 31, 1996                             3,645,833         $36,458        $949,659         $(853,082)
                                                    =============    ============    ============    ===============


See notes to consolidated financial statements.
</TABLE>


                                                        56

<PAGE>

<TABLE>
<CAPTION>


WIRELESS CABLE & COMMUNICATIONS, INC.
AND SUBSIDIARIES
(A DEVELOPMENT STAGE COMPANY)

CONSOLIDATED STATEMENTS OF CASH FLOWS
FOR THE YEAR ENDED DECEMBER 31, 1996,
FROM JULY 31, 1995 (DATE OF INCEPTION) TO DECEMBER 31, 1995,
AND FROM JULY 31, 1995 (DATE OF INCEPTION) TO DECEMBER 31, 1996


<S>                                                             <C>                  <C>                   <C>

                                                                                         July 31, 1995         July 31, 1995
                                                                          Year               (Date of              (Date of
                                                                         Ended            Inception) To         Inception) To
                                                                     December 31,         December 31,          December 31,
                                                                         1996                 1995                  1996
CASH FLOWS FROM DEVELOPMENT ACTIVITIES:
  Net loss                                                        $     (697,954)         $  (155,128)         $   (853,082)
  Adjustments to reconcile net loss to net cash used in
    development activities:
    Depreciation and amortization                                        171,766               73,585               245,351
    Minority interest in loss of subsidiary                              (17,607)              (6,575)              (24,182)
    Interest expense from issuance of common stock                        37,855                    -                37,855
    Change in assets and liabilities:
      Other receivables from related party                              (120,234)                    -             (120,234)
      Prepaid license lease fees                                          33,516             (87,344)               (53,828)
      Accounts payable                                                   219,157                9,062               228,219
      Accrued license lease fees                                           7,215               25,441                32,656
                                                                -----------------    -----------------     -----------------
         Net cash used in development activities                       (366,286)             (140,959)             (507,245)
                                                                -----------------    -----------------     -----------------
CASH FLOWS FROM INVESTING ACTIVITIES:
 Investment in Centurion                                                (440,000)                    -             (440,000)
                                                                -----------------    -----------------     -----------------
         Net cash used in investing activities                          (440,000)                    -             (440,000)
                                                                -----------------    -----------------     -----------------
CASH FLOWS FROM FINANCING ACTIVITIES:
  Proceeds from issuance of common stock                                   1,600                2,000                 3,600
  Borrowings from related party                                          805,602              141,034               946,636
  Borrowings through a promissory note                                    75,000                    -                75,000
                                                                -----------------    -----------------     -----------------
         Net cash provided by financing activities                       882,202              143,034             1,025,236
                                                                -----------------    -----------------     -----------------
NET INCREASE IN CASH                                                      75,916                2,075                77,991
CASH AT BEGINNING OF PERIOD                                                2,075                    -                     -
                                                                -----------------    -----------------     -----------------
CASH AT END OF PERIOD                                             $       77,991       $        2,075       $        77,991

                                                                =================    =================     =================

SUPPLEMENTAL SCHEDULE OF CASH FLOW INFORMATION:
  Cash paid during the year for interest and income taxes
                                                                            NONE                 NONE                  NONE
                                                                =================    =================     =================

SUPPLEMENTAL SCHEDULE FOR NONCASH INVESTING AND FINANCING ACTIVITIES
  In connection with the Separation (see Note 1), the Company issued common stock in
  exchange for the acquisition of assets and the assumption of liabilities as follows:
Historical cost of assets acquired, including prepaid
  license lease fees, equipment, and license rights                                      $  1,282,569
Common stock issued                                                                          (946,662)
                                                                                     -----------------
Liabilities assumed                                                                     $     335,907
                                                                                     =================
See notes to consolidated financial statements.

</TABLE>


                                                          57

<PAGE>



WIRELESS CABLE & COMMUNICATIONS, INC.
AND SUBSIDIARIES
(A DEVELOPMENT STAGE COMPANY)

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
--------------------------------------------------------------------------------


1.       THE COMPANY

         Organization - Wireless Cable &  Communications,  Inc. and subsidiaries
         (the Company) was  incorporated in Nevada on July 31, 1995. The Company
         is   in   the   business   of   acquiring   and   developing   wireless
         telecommunication  systems.  The Company owns a non-operating  wireless
         system  comprised of four  channels and a leased  transmitter  tower in
         Park City, Utah, and owns a non-operating  wireless system comprised of
         lease and license rights to a total of twenty-four  broadcast  channels
         in Auckland,  New Zealand (consisting of four 2.5 GHz and twenty 40 GHz
         channels). The Park City channels and tower rights are held through the
         Company's  wholly-owned  subsidiary,  Transworld  Wireless  Television,
         Inc.,  a Nevada  corporation  ("TWTV Park  City"),  and the New Zealand
         channel rights are held through the Company's  94.9% owned  subsidiary,
         Auckland  Independent   Television   Services,   Ltd.,  a  New  Zealand
         corporation  ("AITS").  The Company is a development  stage company and
         currently has no revenues and no operating  wireless  telecommunication
         systems.

         The  authorized  number of shares of the Company's  preferred  stock is
         5,000,000, $0.01 par value. At December 31, 1996 and 1995, no preferred
         stock was issued or outstanding  and no specific  rights or preferences
         for the  preferred  stock had been  authorized  or  established  by the
         Company's Board of Directors (See note 8).

         The Company was formed for the purpose of continuing the development of
         certain business assets formerly held by Transworld Telecommunications,
         Inc., a Pennsylvania corporation ("TTI"). Under the terms of a business
         separation  (the  "Separation"),  TTI agreed to form a new  corporation
         (the Company) to hold the separated business assets.

         In order to complete  the  Separation,  on August 1, 1995,  the Company
         issued  3,500,000 shares of its common stock, par value $.01 per share,
         to TTI in  exchange  for  TTI's  interest  in AITS,  TWTV Park City and
         certain   other   miscellaneous   assets  with  a  carrying   value  of
         approximately  $946,662 (which  represents the historical cost of those
         assets  to TTI).  The  carrying  values  of the TWTV Park City and AITS
         assets were $4,118 and  $1,278,451,  respectively.  Upon its receipt of
         the Company's shares of common stock,  TTI immediately  transferred the
         shares in the Company to an escrow  agent to be held for the benefit of
         TTI's shareholders of record on August 1, 1995. The distribution of the
         3,500,000  shares to TTI's  shareholders  was delayed until the Company
         and TTI complied with certain  requirements  of the federal  securities
         laws,  including the filing by the Company of a registration  statement
         on Form 10-SB under the Securities  Exchange Act of 1934. The Company's
         Form 10-SB became  effective  December 30, 1996.  The 3,500,000  shares
         were then  distributed to TTI's  shareholders of record as of August 1,
         1995,  on a non-pro  rata  basis,  with the  management  and  principal
         shareholder  of TTI  relinquishing  a  portion  of their  shares in the
         Company in favor of the TTI public shareholders. In general, the public
         shareholders received  approximately 1.6 shares of the Company's common
         stock  for each 10 shares of TTI  common  stock  they held on August 1,
         1995.

         Basis of Presentation - The Company's consolidated financial statements
         have been prepared on a going concern  basis,  which  contemplates  the
         realization  of assets and  satisfaction  of  liabilities in the normal
         course of business.


                                       58

<PAGE>



         As with most development stage companies,  there are uncertainties that
         raise substantial doubt about the ability of the Company to continue as
         a going  concern.  The  Company's  current  wireless  telecommunication
         assets  consist of two groups of wireless  television  channel  rights,
         four channels in the Park City,  Utah area and 24 channels  (consisting
         of the four  MMDS  Channels  and the  twenty  40 GHz  Channels)  in the
         Auckland,   New  Zealand  area.  Neither  of  these  channel  groupings
         presently comprise an operating wireless telecommunications system, and
         the Company  will be  required  to build out the  systems and  initiate
         marketing efforts to acquire subscribers before either group of channel
         rights will begin generating operating income.

         Since its inception,  the Company has sustained net losses and negative
         cash flow, due primarily to start-up costs,  expenses,  and charges for
         depreciation and  amortization of capital  expenditures and other costs
         relating to its development of its wireless  telecommunication systems.
         The  Company  expects to  continue  to  experience  negative  cash flow
         through at least 1997,  and may continue to do so  thereafter  while it
         develops and expands its wireless  telecommunications  systems, even if
         individual systems of the Company become profitable.

         The Company  anticipates that it will obtain the financing necessary to
         fund its future operations through loans,  equity investments and other
         transactions.  While there can be no  assurance  that the Company  will
         secure such  financing,  the Company is  currently in  negotiations  to
         obtain  third  party  financing  for  its  activities;  and  management
         believes that this funding can be obtained under terms  satisfactory to
         the  Company.  In  the  event  that  the  Company  is  unsuccessful  in
         completing  these  financing  arrangements  or in obtaining  substitute
         funding  commitments,  the Company would have difficulty in meeting its
         operating expenses, satisfying its existing or future debt obligations,
         or succeeding  in acquiring,  developing or operating a cable system or
         adding subscribers to such cable systems.  If the Company does not have
         sufficient  cash  flow or is  unable  to  otherwise  satisfy  its  debt
         obligations,  its ongoing growth and operations could be restricted and
         the viability of the Company could be adversely affected.

         The Company has taken  several  actions  which it believes will improve
         its  short-term  and ongoing  liquidity  and cash flow.  These  actions
         include  establishing  policies  designed to conserve  cash and control
         costs,  and  pursuing  additional  financing  and capital  resources as
         described  above.  The  Company's  continuation  as a going  concern is
         dependent upon its ability to satisfactorily meet its debt obligations,
         acquire  and  develop  operating   telecommunication   systems,  secure
         adequate  financing or  additional  equity and  ultimately  to generate
         sufficient  cash flows to achieve cash flow  positive  operations.  The
         consolidated  financial  statements do not include any adjustments that
         might result from the outcome of these uncertainties.

2.       SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

         Principles of  Consolidation - The  consolidated  financial  statements
         include the accounts of the Company and its subsidiaries. The Company's
         subsidiaries  include  AITS,  which is owned 94.9% by the Company,  and
         TWTV Park City,  which is a wholly-owned  subsidiary.  All  significant
         intercompany  accounts and  transactions  have been  eliminated  in the
         consolidation.  The Company's subsidiaries use the U.S. dollar as their
         functional currency.  Foreign currency translation gains and losses are
         included in expenses as they are incurred and were not material for the
         periods ended December 31, 1996 and 1995.

         Use of Estimates in Preparing Financial Statements - 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 disclosure of
         contingent  assets  and  liabilities  at  the  date  of  the  financial
         statements and the reported amounts of revenues and expenses during the
         reporting period. Actual results could differ from those estimates.

         Prepaid License Lease Fees - Prepaid license lease fees are prepayments
         of annual  license  or lease fees  relating  to the  Company's  license
         rights.

                                       59

<PAGE>




         Investment  in  Centurion  -  The  Company  uses  the  cost  method  of
         accounting for its investments in voting shares of other entities where
         it holds  less than 20% of the  voting  shares of the other  entity and
         where  the  Company  does not  exercise  significant  influence.  As of
         December 31,  1996,  the Company had invested a total of $440,000 for a
         4.4% interest in Comunicaciones  Centurion,  S.A., a Venezuelan company
         (see Note 7).

         Equipment - Equipment, consisting entirely of transmission equipment is
         stated at cost. Depreciation is computed using the straight-line method
         over the expected useful life of the assets of five years.  Accumulated
         depreciation  on the  equipment  was $12,567 and $9,967 at December 31,
         1996 and 1995, respectively.

         Net Loss Per Common Share - Net loss per common share is  calculated by
         dividing  net loss by the weighted  average  number of shares of common
         stock outstanding during the period.  Warrants were not included in the
         net loss per common share calculation as they are antidilutive.

         Income Taxes - Under the asset and  liability  approach of Statement of
         Financial  Accounting Standards (SFAS) No. 109, deferred tax assets and
         liabilities are recognized for the future tax consequences attributable
         to  differences  between the financial  statement  carrying  amounts of
         existing assets and liabilities and their existing tax bases.

         New  Accounting  Standards  -  Effective  January 1, 1996,  the Company
         adopted SFAS 121  "Accounting  for the Impairment of Long-Lived  Assets
         and for Long-Lived  Assets to Be Disposed Of." This Statement  requires
         that long-lived assets and certain identifiable  intangibles to be held
         and used by an entity be reviewed  for  impairment  whenever  events or
         changes in circumstances  indicate that the carrying amount of an asset
         may not be recoverable. This standard did not have a material effect on
         the Company's 1996 consolidated financial statements.

         On January 1, 1996, the Company  adopted SFAS No. 123,  "Accounting for
         Stock-Based  Compensation".  SFAS No. 123 requires expanded disclosures
         of stock-based compensation  arrangements with employees and encourages
         (but does not require)  compensation  cost to be measured  based on the
         fair value of the equity instrument awarded. The Company has decided to
         continue to apply APB Opinion No. 25 (as  permitted  by SFAS No.  123).
         The  warrants  granted  on  December  27,  1996  did  not  require  any
         compensation expense to be disclosed per SFAS No. 123.

         In February 1997, SFAS No. 128,  "Earnings Per Share" and SFAS No. 129,
         "Disclosures of Information about Capital Structure" were issued.  SFAS
         No.  128  changes  the   computation,   presentation,   and  disclosure
         requirements  of earnings per share for  entities  with  publicly  held
         common  stock.   SFAS  No.  129  addresses   standards  for  disclosing
         information  about  an  entity's  capital   structure.   Although  such
         statements  are  not  effective  until  December  31,  1997,  had  such
         statements  been  adopted for the periods  ended  December 31, 1996 and
         1995,  and for the period  from July 31,  1995 (date of  inception)  to
         December 31, 1996, the effect would not be significant.

3.       LEASE AND LICENSE AGREEMENTS

         The  Company  has  certain  lease and  license  agreements  for various
         multi-point  multi-channel   distribution  service  (MMDS  or  wireless
         telecommunication)  channels and frequencies  within New Zealand.  Each
         license is for a specified  number of channels  and  frequencies  for a
         specified  length of time.  The licenses were obtained from TTI through
         the Separation and are recorded at TTI's historical cost.

         The Company has three  license  agreements  relating to ten channels in
         New  Zealand.  The first  license is for six channels and consists of a
         three year lease which expired  December 9, 1996.  The accrued  license
         lease

                                       60

<PAGE>



         fees  balance of $109,398 at December 31, 1996 and $102,183 at December
         31,  1995  relates to the three year lease  which  expired  December 9,
         1996. The Company has not remitted the accrued  balance at December 31,
         1996  of  $109,398  which  represents  two  annual  license  lease  fee
         payments.  The  contractual  amounts of this license are denominated in
         New Zealand  dollars which are subject to foreign  exchange  risk.  The
         December  31, 1996 accrued  balance of $109,398  has been  converted to
         U.S.  dollars using the December 31, 1996  exchange rate of $0.71.  The
         December  31, 1995 accrued  balance of $102,183  has been  converted to
         U.S.  dollars using the December 31, 1995  exchange rate of $0.65.  The
         second  license is for two channels and consists of an eight year lease
         expiring March 1, 2001 with a guaranteed  option to renew the lease for
         an  additional  four years.  The third  license is for two channels and
         consists of a ten year lease expiring September 30, 2004.

         The Company is obligated to make the  following  future  minimum  lease
         payments which have been  converted to U.S.  dollars using the December
         31, 1996 exchange rate of $0.71:

Year ending December 31:
  1997                                                               $  98,618
  1998                                                                  98,618
  1999                                                                  58,618
  2000                                                                  58,618
  2001                                                                  58,618
  2002 and thereafter                                                  140,144
                                                              -----------------
Total future lease payments                                           $513,234
                                                              =================

         License rights are amortized  using the  straight-line  method over the
         life of the  leases  ranging  from three to twelve  years.  Accumulated
         amortization  on the  license  rights  was  $526,833  and  $357,667  at
         December 31, 1996 and December 31, 1995, respectively.

         In addition to owning the rights to use these licenses,  the Company is
         required  to  make  certain  license  lease  fee  payments  which  vary
         depending on the lease.  These license lease fee payments are generally
         paid in advance.  Certain lease payments are denominated in New Zealand
         dollars which are subject to foreign exchange risk. Lease expense under
         all noncancelable operating leases totaled $139,029 and $56,421 for the
         year ended  December  31,  1996 and for the period  from July 31,  1995
         (date of inception) to December 31, 1995, respectively. Prepaid license
         lease  fees  represent  prepayments  of annual  license  lease fees and
         totaled $167,446 and $200,962 as of December 31, 1996, and December 31,
         1995, respectively.

4.       RELATED PARTY TRANSACTIONS

         In June 1996, TTI borrowed $2,500,000 (the Loan) from Pacific Mezzanine
         Fund, L.P., an unrelated party. As partial consideration for making the
         Loan,  Pacific Mezzanine Fund, L.P. remitted $1,600 for the purchase of
         145,833 shares of the Company's common stock. Because these shares were
         issued at below market value, the Company recorded  additional interest
         expense of $37,855 at the time of the stock purchase.  The terms of the
         Loan will allow TTI to loan funds to the  Company  pursuant to the loan
         commitment agreement between the Company and TTI.


         The Company has entered  into an agreement  with TTI wherein,  at TTI's
         sole  discretion,  the Company will be allowed to borrow from TTI up to
         $1,000,000 for the purpose of facilitating the acquisition,  operation,
         build-out,  and  maintenance  of  the  Company's  business  operations.
         Interest on any  outstanding  balance  will accrue at 8% per annum with
         the principal  and interest  becoming due and payable in full on August
         1, 2001.  As of December 31, 1996,  $996,707  plus accrued  interest of
         $47,301 was outstanding on the loan. As of December 31, 1995,  $231,967
         plus  accrued  interest  of $6,439  was  outstanding  on the loan.  The
         estimated

                                       61

<PAGE>



         fair value of this long-term debt at December 31, 1996 and December 31,
         1995 was not materially  different from the carrying value presented in
         the consolidated balance sheet.

         The Company has a current liability to an entity owned by the father of
         the  president of the Company in the amount of $100,000 for  consulting
         services related to the New Zealand channel frequencies. This liability
         was assumed during the Separation.

         As of December 31, 1996, the Company had a related party  receivable in
         the amount of $120,234 from Telecom Investment Corporation,  a Delaware
         corporation ("TIC"), which merged with a wholly owned subsidiary of the
         Company  effective  February  4, 1997 (see Note 8). The  related  party
         receivable  relates to professional fees and general and administrative
         expenses  paid by the Company on behalf of TIC. At December  31,  1996,
         TIC  represents a related party because one of the Company's  directors
         is also a director of TIC.  The related  party  director  did not own a
         controlling interest in TIC at December 31, 1996.

5.       INCOME TAXES

         The Company has federal and state net operating loss  carryforwards  of
         approximately  $153,000 and $9,000 as of December 31, 1996 and December
         31,  1995,  respectively,  that may be offset  against  future  taxable
         income and expense through 2010.

         The  long-term  net  deferred  tax assets of  $141,000  and  $10,000 at
         December  31,  1996 and  December  31,  1995,  respectively,  are fully
         reserved  with  a  valuation   allowance  due  to  the  uncertainty  of
         realization and are comprised of the following:
<TABLE>
<S>                                                              <C>                         <C>

                                                                            December 31,                December 31,
                                                                               1996                        1995

         Deferred Tax Assets:
Net operating loss carryforwards                                               $59,700                       $3,100
Depreciation                                                                       900                          400
Organizational expenditures                                                     90,800                        7,000
                                                                 -----------------------     ------------------------

         Total deferred tax asset                                              151,400                       10,500

Deferred Tax Liabilities - Amortization                                       (10,400)                        (500)
Valuation allowance                                                          (141,000)                     (10,000)
                                                                 -----------------------     ------------------------

Total net deferred tax asset                                                      NONE                         NONE
                                                                 =======================     ========================
</TABLE>


     The net change in the  valuation  allowance was $131,000 for the year ended
     December 31, 1996. The difference between income tax expense at the federal
     statutory rate and the Company's  effective tax rate is attributable to the
     valuation allowance.

6.       NOTE PAYABLE

         The Company has borrowed  $75,000  through a secured  promissory  note,
         with interest  payable  semi-  annually on each June 30 and December 31
         and  bearing  interest  at  the  rate  of 9%  per  annum.  The  secured
         promissory  note is due on January  31, 2002 and is  collateralized  by
         assets of the  Company  and all  outstanding  shares  of the  Company's
         common stock owned by two of the Company's directors. The holder of the
         promissory  note also has the right until January 31, 2002,  subject to
         certain conditions and restrictions,  to exercise a warrant to purchase
         up to $75,000 of the  Company's  common  stock at a price which will be
         determined  the  earlier  of May 1998 or at the  timing  of any  future
         equity  offering  greater than  $5,000,000.  As of July 21,  1997,  the
         Company has borrowed $725,000 through secured promissory notes with the
         same terms as the

                                       62

<PAGE>



         initial  $75,000 secured  promissory  note. An officer of the holder of
         the promissory note is also a director of the Company.

7.       COMMITMENTS AND CONTINGENCIES

         The  Company is involved  in certain  litigation  matters in the normal
         course of business which, in the opinion of management, will not result
         in any material adverse effects on the Company.

         On November 8, 1996, the Company,  acting as an agent for TIC (see Note
         8), entered into an agreement  under which TIC has an option to acquire
         all of the stock of Caracas VivaVision, T.V., S.A. ("CVV") (the "Option
         Agreement"). The option term was originally through March 31, 1997, but
         was extended by CVV (on behalf of the  shareholders of CVV and pursuant
         to the terms of the Option Agreement) through August 15, 1997. CVV is a
         Venezuelan  corporation which has entered into an agreement with the 28
         GHz license holder in Venezuela to market and  commercialize the 28 GHz
         frequencies  within the country of  Venezuela.  The  original  purchase
         price for this option was $11,000,000  consisting of $7,700,000 of cash
         and  $3,300,000 of the Company's  common stock at a fair value equal to
         the offering price of a future equity offering.

         On August 15,  1997,  the Company  completed  the purchase of 68.14% of
         CVV,  pursuant to an  amendment  signed on August 12,  1997.  Under the
         terms of the  amendment,  the Company  paid and  delivered  $200,000 in
         cash, 1,577,000 shares of the Company's common stock, 354,825 shares of
         the Company's newly designated Series "B" Preferred Shares (See Note 8)
         and a promissory  note in the amount of $200,000.  The promissory  note
         accrues  interest at the rate of 6.75% per annum and the  principal and
         all accrued interest is payable in one principal  installment due on or
         before the earlier of (i) October 15, 1997,  or (ii) ten days after the
         closing by the Company of an  investment  in the capital of the Company
         in excess of $2 million.

         In conjunction  with this  purchase,  the Company also entered into the
         following  agreements with one of the former principal  shareholders of
         CVV: (i) an employment  agreement  with the former CVV principal  which
         commenced on August 15, 1997 for a one year period at an annual  salary
         of $102,857  plus  additional  payments in  accordance  with  Venezuela
         employment  law;  and (ii) a voting  agreement  electing the former CVV
         principal to the board of directors of the Company until the earlier of
         August  14,  2000 or  immediately  preceding  the  closing  of a public
         offering by the Company  which  results in net proceeds of at least $15
         million and a market capitalization of at least $50 million.

         On August 1, 1997,  the Company and the  remaining  shareholder  of CVV
         entered into an additional  amendment to the Option  Agreement  whereby
         the  Company  agreed  to  purchase  an  additional  10%  of  the  total
         outstanding shares of CVV for $800,000 in cash. On August 15, 1997, the
         shareholder  had not  complied  with the terms of the  amendment to the
         Option Agreement and is in default.

         On  July  17,  1996,  the  Company   entered  into  an  agreement  with
         Comunicaciones Centurion, S.A., ("Centurion"),  to acquire up to 11.53%
         of its voting capital stock (1% per $100,000 investment).  Centurion is
         a Venezuelan  corporation which holds the license rights for the 28 GHz
         frequencies within Venezuela.  As of December 31, 1996, the Company had
         invested  $440,000 with Centurion and had recorded a 4.4% investment in
         Centurion.  The Company  had the  obligation  to acquire an  additional
         7.13%  investment in Centurion  for $713,000  (for a total  interest of
         11.53%,  which represents the maximum  additional  foreign ownership of
         Centurion  that  would be  allowed  under  Venezuelan  law given  other
         existing  foreign  ownership  positions).  As of August 15,  1997,  the
         Company had invested  $845,955 with Centurion and had recorded an 8.46%
         investment in Centurion.  The obligation to invest in Centurion  ceased
         on August 15, 1997 when WCCI exercised its option to purchase the stock
         of CVV according to the terms described below.



                                       63

<PAGE>





8.       SUBSEQUENT EVENTS

         On January 30,  1997,  the  Company's  board of  directors  established
         preferences  for a Series  A class of  preferred  stock  consisting  of
         4,000,000  shares.  The Series A preferred shares entitle their holders
         to 10 votes on all matters  submitted to a vote of the  shareholders of
         the Company and liquidation and dividend rights entitling the holder to
         receive an amount per share equal to ten times the aggregate  amount to
         be distributed  per share to the holders of common stock. On August 12,
         1997,  the  Company  designated  an  additional  250,000  shares of its
         preferred stock as Series A preferred stock.

         In  December  1996,  the Company  entered  into  negotiations  with TIC
         regarding the terms of a potential  merger or acquisition.  TIC held or
         had the right to acquire wireless  communication  rights in a number of
         South American and Latin American countries, including Venezuela, Costa
         Rica,  Panama and  Guatemala.  On January 31,  1997,  Wireless  Cable &
         Communications,  Inc.  ("WCCI")  entered into a  transaction  with TIC,
         pursuant  to  which  TIC  merged  with  a  newly  formed   wholly-owned
         subsidiary of WCCI, NewWCCI, Inc. (the "Merged Companies").  The merger
         was  effective  February 4, 1997.  Under the terms of the  merger,  the
         former  shareholders of TIC received  2,397,732  shares of WCCI's newly
         designated  Series  "A"  Preferred  Shares  and  legally  TIC  became a
         wholly-owned subsidiary of WCCI. Also, the former option holders of TIC
         received  options  to  purchase  199,811  shares of WCCI's  Series  "A"
         Preferred  Shares. As a result of the merger,  the former  shareholders
         and option  holders of TIC currently  hold  approximately  87.7% of the
         voting  power of the  Merged  Companies  on a common  share  equivalent
         basis.  Generally accepted accounting principles typically require that
         the company whose  shareholders  retain the majority voting interest in
         the  combined  business  be  treated  as the  acquiror  for  accounting
         purposes.  Accordingly, the merger has been accounted for as a "reverse
         acquisition"  whereby TIC is deemed to have acquired an 87.7%  interest
         on a common share  equivalent  basis in WCCI using the purchase method.
         However,   WCCI  remains  the  legal  entity  and  the  Registrant  for
         Securities and Exchange Commission reporting purposes.

         Consistent  with the  reverse  acquisition  accounting  treatment,  the
         financial  statements  presented for the period from September 27, 1994
         (date of TIC  inception)  through  December 31, 1996 are the  financial
         statements of TIC and differ from the consolidated financial statements
         of WCCI and its subsidiaries as previously reported.

         Generally  accepted  accounting  principles require that the assets and
         liabilities  of WCCI (the legal  acquiror) be recorded at fair value at
         the date of the merger. However, based on management's  estimates,  the
         fair  value  of WCCI  is not  significantly  different  than  its  book
         carrying value. Therefore, the assets and liabilities of WCCI have been
         recorded  at their  carryover  book value as of  February  4, 1997 (the
         effective  date of the merger) to reflect the  reverse  acquisition  of
         WCCI as follows:


Current assets (including cash of $56,583)                 $            217,017
License rights                                                          913,500
Property and equipment (net)                                                217
Other long term assets                                                  577,347
Current liabilities                                                    (463,191)
Long-term debt                                                       (1,126,823)
Minority interest                                                       (31,077)
                                                           ---------------------

Stockholders' deficit (net)                                $             86,990
                                                           =====================

         The proforma net loss of the merged  companies is $334,899,  $1,120,522
         and $1,514,529 for the years ended December 31, 1995,  1996 and for the
         period from  September  27, 1994 (date of  inception)  to December  31,
         1996.

                                       64

<PAGE>




         On August 4, 1997,  a third party  loaned the Company  $2,100,000.  The
         loan bears  interest at 10%, is unsecured,  and is payable with accrued
         interest on December  31,  1997.  The Company has used  $200,000 of the
         loan  proceeds  to  exercise  its  option  to  purchase  68.14%  of the
         outstanding  shares  of CVV  (see  Note  7),  and  intends  to use  the
         remaining proceeds from the loan to pay $800,000 to exercise its option
         in Venezuela to purchase an additional 10% of CVV, to pay for equipment
         and start-up  expenses in Venezuela and  Guatemala of $579,850,  and to
         pay outstanding accounts payable of $496,784.

         On August  12,  1997,  the  Company  designated  750,000  shares of its
         preferred  stock  as  Series  "B"  Preferred  Shares.  The  rights  and
         privileges of the Series "B" Preferred Shares are as follows:  (1) they
         carry a  liquidation  preference  of $10 per share.  The Series "B" and
         Series "A" Preferred  Shares share ratably in liquidation  proceeds (in
         accordance   with   their   interests),   prior   to  any   liquidation
         distributions to the common shareholders;  (2) they carry voting rights
         that  entitle  the  holder  to 1 vote per share  and the  holders  vote
         together with the common shareholders as one class on all matters;  (3)
         they are  non-redeemable;  (4) they pay noncumulative  dividends in the
         annual amount of 6.75% per share payable  semiannually on January 1 and
         July 1 of each year (payable in cash or additional Series "B" Preferred
         Shares,  at the Company's  option);  and (5) they are convertible  only
         into  common  shares  of the  Company  on  the  earlier  of  the  third
         anniversary of their initial  issuance,  the date preceding the closing
         of an  underwritten  public  offering  resulting in net proceeds to the
         Company  of $15  million  and a market  capitalization  of $50  million
         (including all amounts  received by the Company in conjunction with the
         underwritten  public offering) or the sale of all or substantially  all
         of the  Company's  business  or assets or a similar  transaction.  Each
         Series "B"  Preferred  Share is  convertible  into the number of common
         shares  obtained  by  dividing  $10 by the  price per  common  share as
         determined in good faith by the board of directors of the Company,  and
         (ii) in the case of an underwritten  public  offering,  each Series "B"
         Preferred  Share is  convertible  into  such  number  of  shares  as is
         determined by dividing $10 by the public offering price.



                                       65

<PAGE>
<TABLE>
<CAPTION>

PART III.

INDEX TO EXHIBITS
              <S>              <C>                                                                   <C>

              Exhibit No.                                  Exhibit                                   Page
                  3.1          Articles of Incorporation                                              *
                  3.2          Bylaws                                                                 *
                  4.1          Statement of Rights and Preferences for the Series A Preferred         68
                               Stock
                  4.2          Statement of Rights and Preferences for the Series B Preferred         72
                               Stock
                  10.1         Agreement and Plan of Reorganization                                   *
                  10.2         Escrow Agreement between Fidelity Transfer Company, TTI and            *
                               the Company
                  10.3         Commitment Agreement between the Company and TTI                       *
                  10.4         Letter of Understanding with Decathlon Communications, Inc.            *
                  10.5         Merger Agreement Between the Company and Telecom Investment            77
                               Corporation
                  10.6         Services Agreement between Bridgeport Financial, Inc. and the          95
                               Company
                  10.7         Option and Stock Purchase Agreement between the Company,              103
                               Caracas Viva Vision, S.A. and its Shareholders
                  10.8         July 24, 1997 Amendment to Option and Stock Purchase Agreement        160
                  10.9         August 13, 1997 Amendment to Option and Stock Purchase                164
                               Agreement
                  12.1         Computation of Earnings Per Share                                     166
                  21.1         Subsidiaries of the Registrant                                        167
                  27.1         Financial Data Schedule                                               168





*        This document was previously filed with the Commission and is incorporated in this report by reference.

</TABLE>




                                       66
<PAGE>



                                                      SIGNATURES

Pursuant to the  requirements of Section 13 or 15(d) of the Securities  Exchange
Act of 1934,  the Company has duly caused this report to be signed on its behalf
by the undersigned thereunto duly authorized.

                                           WIRELESS CABLE & COMMUNICATIONS, INC.
August 15, 1997
Date
                                           /s/ Lance D'Ambrosio
                                           Lance D'Ambrosio
                                           President and Chief Executive Officer
                                           (Principal Executive Officer)


                                           WIRELESS CABLE & COMMUNICATIONS, INC.
August 15, 1997
Date
                                           /s/ Anthony Sansone
                                           Anthony Sansone
                                           Secretary and Treasurer
                                           (Principal Financial Officer)

DIRECTORS


August 15, 1997                            /s/ Lance D'Ambrosio
Date                                       Lance D'Ambrosio



August 15, 1997                            /s/ Troy D'Ambrosio
Date                                       Troy D'Ambrosio



August 15, 1997                            /s/ George Sorenson
Date                                       George Sorenson



August 15, 1997                            /s/ Donald Williams
Date                                       Donald Williams



                                                          67