Document:

<PAGE>

                                                                     EXHIBIT 4.3
                          Option to Purchase 250,000
                            Shares of Common Stock

                           REPRESENTATIVES' WARRANT
                           ------------------------

                            Dated: __________, 2000

     THIS CERTIFIES THAT KAUFMAN BROS., L.P., JOHN G. KINNARD AND COMPANY,
INCORPORATED AND WESTPARK CAPITAL, INC. (herein sometimes called the "Holders"
or the "Representatives") are entitled to purchase from WORLDQUEST NETWORKS,
INC., a Delaware corporation (the "Company"), at the price and during the period
as hereinafter specified, up to Two Hundred Fifty Thousand (250,000) shares (the
"Shares") of common stock, $.01 par value per share (the "Common Stock") at a
purchase price of $____ per share (155% of the initial public offering price)
subject to adjustment as described below, at any time during the four-year
period commencing one (1) year from the effective date of the Registration
Statement (as defined herein) (the "Effective Date").

     This Representatives' Warrant (the "Representatives' Warrant") is issued
pursuant to an Underwriting Agreement between the Company and Kaufman Bros.,
L.P., John G. Kinnard and Company, Incorporated and WestPark Capital, Inc., as
Representatives of the several Underwriters set forth in Schedule I to said
Underwriting Agreement, in connection with a public offering, through the
Representative, of 2,500,000 Shares as therein described (and up to 375,000
additional Shares covered by an over-allotment option granted by the Company to
the Underwriters), and in consideration of $1.00 received by the Company for the
Representatives' Warrant.  Except as specifically otherwise provided herein, the
Shares issued pursuant to the Representatives' Warrant shall bear the same terms
and conditions as described under the caption "Description of Capital Stock-
Common Stock" in the Registration Statement on Form SB-2, File No. 333-93019
(the "Registration Statement") except that the Holder shall have registration
rights under the Securities Act of 1933, as amended (the "Act"), for the
Representatives' Warrant and the Shares issuable pursuant thereto as more fully
described in paragraph 6 herein.

     1.   The rights represented by the Representatives' Warrant shall be
exercised at the price, set forth in the first paragraph hereof subject to
adjustment in accordance with Section 8 hereof (the "Exercise Price"), and
during the periods as follows:

          (a) During the period from the Effective Date to and through
              __________, 2001 (the "First Anniversary Date"), inclusive, the
              Holder shall have no right to purchase any Shares hereunder,
              except that in the event of any merger, consolidation or sale of
              substantially all the assets of the Company as an entirety prior
              to the First Anniversary Date (other than (i) a merger or
              consolidation in which the Company is the continuing corporation
              and which does not result in any reclassification or
              reorganization of any outstanding shares of Common Stock or (ii)
              any sale/leaseback, mortgage

                                       1
<PAGE>

              or other financing transaction), the Holder shall have the right
              to exercise the Representatives' Warrant concurrently with such
              event and into the kind and amount of shares of stock and other
              securities and property (including cash) receivable by a holder of
              the number of Shares into which the Representatives' Warrant were
              exercisable immediately prior thereto.

          (b) Between _____________, 2001 and 2005, (five (5) years from the
              Effective Date, i.e. the "Expiration Date") inclusive, the Holder
              shall have the option to purchase Shares hereunder at the Exercise
              Price.

          (c) After the Expiration Date, the Holder shall have no right to
              purchase any Shares hereunder.

     2.   (a)  The rights represented by the Representatives' Warrant may be
exercised at any time within the periods above specified, in whole or in part,
by (i) the surrender of the Representatives' Warrant (with the purchase form at
the end hereof properly executed) at the principal executive office of the
Company (or such other office or agency of the Company as it may designate by
notice in writing to the Holder at the address of the Holder appearing on the
books of the Company); (ii) payment to the Company of the exercise price then in
effect for the number of Shares specified in the above-mentioned purchase form
together with applicable stock transfer taxes, if any; and (iii) delivery to the
Company of a duly executed agreement signed by the person(s) designated in the
purchase form to the effect that such person(s) agree(s) to be bound by the
provisions of paragraph 6 and subparagraphs (b), (c) and (d) of paragraph 7
hereof. The Representatives' Warrant shall be deemed to have been exercised, in
whole or in part to the extent specified, immediately prior to the close of
business on the date the Representatives' Warrant is surrendered and payment is
made in accordance with the foregoing provisions of this paragraph 2, and the
person or persons in whose name or names the certificates for the Shares shall
be issuable upon such exercise shall become the holder or holders of record of
such Shares at that time and date.  The Shares and the certificates for the
Shares so purchased shall be delivered to the Holder within a reasonable time,
not exceeding ten (10) business days, after the rights represented by this
Representatives' Warrant shall have been so exercised.

          (b)  Notwithstanding anything to the contrary contained in paragraph
2(a), the Holder may elect to exercise this Representatives' Warrant in whole or
in part by receiving Shares equal to the value (as determined below) of this
Representatives' Warrant, or any part hereof, upon surrender of the
Representatives' Warrant at the principal office of the Company together with
notice of such election in which event the Company shall issue to the Holder a
number of Shares computed using the following formula:

                                   X = Y(A-B)
                                       ------
                                         A

         Where X =  the number of Shares to be issued to the Holder;

                                       2
<PAGE>

               Y =  the number of Shares issuable upon exercise of this
                    Representatives' Warrant;

               A =  the current fair market value of one share of Common Stock;

               B =  the Exercise Price of the Representatives' Warrant;

                    As used herein, current fair market value of Common Stock
               shall mean with respect to each share of Common Stock the average
               of the closing prices of the Common Stock sold on the principal
               national securities exchanges on which the Common Stock is at the
               time admitted to trading or listed, or, if there have been no
               sales on any such exchange on such day, the average of the
               highest bid and lowest ask price on such day as reported by
               NASDAQ, or any similar organization if NASDAQ is no longer
               reporting such information, either (i) on the date which the form
               of election is deemed to have been sent to the Company (the
               "Notice Date") or (ii) over a period of five (5) trading days
               preceding the Notice Date, whichever of (i) or (ii) is greater.
               If on the date for which current fair market value is to be
               determined the Common Stock is not listed on any securities
               exchange or quoted in the NASDAQ System or the over-the-counter
               market, the current fair market value of Common Stock shall be
               the highest price per share which the Company could then obtain
               from a willing buyer (not a current employee or director) for
               shares of Common Stock sold by the Company, from authorized but
               unissued shares, as determined in good faith by the Board of
               Directors of the Company, unless prior to such date the Company
               has become subject to a binding agreement for a merger,
               acquisition or other consolidation pursuant to which the Company
               is not the surviving party, in which case the current fair market
               value of the Common Stock shall be deemed to be the value to be
               received by the holders of the Common Stock for each share
               thereof pursuant to the Company's acquisition.

     3.   The Representatives' Warrant shall not be sold, transferred, assigned,
or hypothecated for a period of one year commencing on the Effective Date except
that it may be transferred to successors of the Holder, and may be assigned in
whole or in part to any person who is an officer of the Holder to any members of
the selling group and/or the officers or partners thereof during such period.
This Representatives' Warrant must be executed immediately upon its transfer at
any time after one year from the Effective Date, and if not so executed, shall
lapse.  Any such assignment shall be effected by the Holder by (i) executing the
form of assignment at the end hereof and (ii) surrendering the Representatives'
Warrant for cancellation at the office or agency of the Company referred to in
paragraph 2 hereof, accompanied by a certificate (signed by an officer of the
Holder if the Holder is a corporation) stating that each transferee is a
permitted transferee under this paragraph 3; whereupon the

                                       3
<PAGE>

Company shall issue, in the name or names specified by the Holder (including the
Holder), a new Representatives' Warrant or Warrants of like tenor and
representing in the aggregate rights to purchase the same number of Shares as
are purchasable hereunder at such time.

     4.   The Company covenants and agrees that all Shares which may be
purchased hereunder will, upon issuance and delivery against payment therefor of
the requisite purchase price, be duly and validly issued, fully paid and
nonassessable.  The Company further covenants and agrees that, during the
periods within which the Representatives' Warrant may be exercised, the Company
will at all times have authorized and reserved a sufficient number of shares of
its Common Stock to provide for the exercise of the Representatives' Warrant.

     5.   The Representatives' Warrant shall not entitle the Holder to any
voting rights or other rights, including without limitation notice of meetings
of other actions or receipt of dividends, as a stockholder of the Company.

     6.   (a)  The Company shall advise the Holder or its permitted transferee,
whether the Holder holds the Representatives' Warrant or has exercised the
Representatives' Warrant and holds Shares, by written notice at least four weeks
prior to the filing of any new registration statement thereto under the Act, or
the filing of a notification on Form 1-A under the Act for a public offering of
securities, covering any securities of the Company, for its own account or for
the account of others, except for any registration statement filed on Form S-4
or S-8 (or other comparable form), and will, during the five (5) year period
from the Effective Date, upon the request of the Holder, include in any such new
registration statement (or notification as the case may be) such information as
may be required to permit a public offering of, all or any of the Shares
underlying the Representatives' Warrant (the "Registrable Securities").  For so
long as the Warrants remain outstanding and as long as required by the Act (so
long as the Holder's ability to exercise any Warrant is not adversely affected),
the Company currently intends to file post-effective amendments to the
Registration Statement (or any new registration statement filed by the Company)
setting forth or otherwise incorporating certain information contained in the
then most recent quarterly report on Form 10-Q or annual report on Form 10-K
filed by the Company (each such post-effective amendment, a "Quarterly
Amendment").  The parties hereby agree that if at any time during such five (5)
year period the Company receives written notice from the Holder at least two
weeks prior to the filing of any such Quarterly Amendment indicating such
Holder's intention to offer Registrable Securities in such Quarterly Amendment,
the Company will include in such Quarterly Amendment such information as may be
required to permit a public offering of such Registrable Securities.  The
delivery by the Holder of any such notice shall not constitute a demand made
pursuant to Section 6(b).  The Company shall supply prospectuses and such other
documents as the Holder may reasonably request in order to facilitate the public
sale or other disposition of the Registrable Securities, use its best efforts to
register and qualify any of the Registrable Securities for sale in such states
(i) as such Holder designates and (ii) with respect to which the Company
obtained a qualification in connection with its initial public offering; and do
any and all other acts and things which may be necessary or desirable to enable
such Holder to consummate the public sale or other disposition of the

                                       4
<PAGE>

Registrable Securities, all at no expense to the Holder or the Representative
(other than sales commissions, underwriting discounts or commissions, or other
expenses of such sale), and furnish indemnification in the manner provided in
paragraph 7 hereof.  The Holder shall furnish information and indemnification as
set forth in paragraph 7.

          (b) At any time during the four (4) year period beginning one (1) year
after the Effective Date, a 50% Holder (as defined below) may request, on two
occasions, that the Company register under the Act any and all of the
Registrable Securities held by such 50% Holder, once at the Company's expense
and on the second occasion, at the 50% Holder's expense.  Upon the receipt of
any such notice, the Company will promptly, but no later than four weeks after
receipt of such notice, file a post-effective amendment to the current
Registration Statement or a new registration statement pursuant to the Act, so
that such designated Registrable Securities may be publicly sold under the Act
as promptly as practicable thereafter and the Company will use reasonable
efforts to cause such registration to become and remain effective (including the
taking of such reasonable steps as are necessary to obtain the removal of any
stop order) within 120 days after the receipt of such notice, provided, that
such Holder shall furnish the Company with appropriate information in connection
therewith as the Company may reasonably request in writing.  The 50% Holder may,
at its option, request the registration of any of the Shares underlying the
Representatives' Warrant in a registration statement made by the Company as
contemplated by Section 6(a) or in connection with a request made pursuant to
this Section 6(b) prior to acquisition of the Shares issuable upon exercise of
the Representatives' Warrant.  The 50% Holder may, at its option, request such
post-effective amendment or new registration statement during the described
period with respect to the Representatives' Warrant and/or the Shares and such
registration rights may be exercised by the 50% Holder prior to or subsequent to
the exercise of the Representatives' Warrant.  Within ten days after receiving
any such notice pursuant to this subsection (b) of paragraph 6, the Company
shall give notice to any other Holders of the Representatives' Warrant, advising
that the Company is proceeding with such post-effective amendment or
registration statement and offering to include therein the Shares underlying
that part of the Representatives' Warrant held by the other Holders, provided
that they shall furnish the Company with such appropriate information (relating
to the intentions of such Holders) in connection therewith as the Company shall
reasonably request in writing.  All costs and expenses of the post-effective
amendment or new registration statement shall be borne by the Company, except
that the Holder(s) shall bear the fees of their own counsel and any other
advisors retained by them and any underwriting discounts or commissions
applicable to any of the securities sold by them.  The Company will use its best
efforts to maintain such registration statement or post-effective amendment
current under the Act for a period of at least 180 days from the effective date
thereof.  The Company shall supply prospectuses, and such other documents as the
Holder(s) may reasonably request in order to facilitate the public sale or other
disposition of the Registrable Securities, use its best efforts to register and
qualify any of the Registrable Securities for sale in such states (i) as such
Holder(s) designate and (ii) with respect to which the Company obtained a
qualification in connection with its initial public offering and furnish
indemnification in the manner provided in paragraph 7 hereof.  Notwithstanding
the foregoing set forth in this paragraph 6(b), the Company shall not be
required to include in any

                                       5
<PAGE>

registration statement any Registrable Securities which in the opinion of
counsel to the Company (which opinion is reasonably acceptable to counsel to the
Representative) would be saleable immediately without restriction under Rule 144
(or its successor) if the Representatives' Warrant was exercised pursuant to
paragraph 2(b) herein.

          (c) The term "50% Holder" as used in this paragraph 6 shall mean the
Holder(s) of at least 50% of the Representatives' Warrant and/or the Shares
underlying the Representatives' Warrant (considered in the aggregate).

     7.   (a)  Whenever pursuant to paragraph 6 a registration statement
relating to any Shares issued upon exercise of the Representatives' Warrant is
filed under the Act, amended or supplemented, the Company will indemnify and
hold harmless each Holder of the securities covered by such registration
statement, amendment or supplement (such Holder being hereinafter called the
"Distributing Holder"), and each person, if any, who controls (within the
meaning of the Act) the Distributing Holder, and each underwriter (within the
meaning of the Act) of such securities and each person, if any, who controls
(within the meaning of the Act) any such underwriter, against any losses,
claims, damages or liabilities, joint or several, to which the Distributing
Holder, any such controlling person or any such underwriter may become subject,
under the Act or otherwise, insofar as such losses, claims, damages or
liabilities, or actions in respect thereof, arise out of or are based upon any
untrue statement or alleged untrue statement of any material fact contained in
any such registration statement as declared effective or any final prospectus
constituting a part thereof or any amendment or supplement thereto, or arise out
of or are based upon the omission or the alleged omission to state therein a
material fact required to be stated therein or necessary to make the statements
therein not misleading and will reimburse the Distributing Holder or such
controlling person or underwriter for any legal or other expense reasonably
incurred by them in connection with investigating or defending any such loss,
claim, damage, liability or action; provided, however, that the Company will not
be liable in any such case to the extent that any such loss, claim, damage or
liability arises out of or is based upon an untrue statement or alleged untrue
statement or omission or alleged omission made in said registration statement,
said preliminary prospectus, said final prospectus or said amendment or
supplement in reliance upon and in conformity with written information furnished
by such Distributing Holder or any other Distributing Holder for use in the
preparation thereof and provided further, that the indemnity agreement provided
in this Section 7(a) with respect to any preliminary prospectus shall not inure
to the benefit of any Distributing Holder, controlling person of such
Distributing Holder, underwriter or controlling person of such underwriter from
whom the person asserting any losses, claims, charges, liabilities or litigation
based upon any untrue statement or alleged untrue statement of a material fact
or omission or alleged omission to state therein a material fact, received such
preliminary prospectus, if a copy of the prospectus in which such untrue
statement or alleged untrue statement or omission or alleged omission was
corrected has not been sent or given to such person within the time required by
the Act and the Rules and Regulations thereunder.

                                       6
<PAGE>

          (b) The Distributing Holder will indemnify and hold harmless the
Company, each of its directors, each of its officers who have signed said
registration statement and such amendments and supplements thereto, and each
person, if any, who controls the Company (within the meaning of the Act) against
any losses, claims, damages or liabilities, joint or several, to which the
Company or any such director, officer or controlling person may become subject,
under the Act or otherwise, insofar as such losses, claims, damages or
liabilities, or actions in respect thereof, arise out of or are based upon any
untrue or alleged untrue statement of any material fact contained in said
registration statement, said preliminary prospectus, said final prospectus, or
said amendment or supplement, or arise out of or are based upon the omission or
the alleged omission to state therein a material fact required to be stated
therein or necessary to make the statements therein not misleading, in each case
to the extent, but only to the extent, that such loss, claim, damage or
liability arises out of or is based upon an untrue statement or alleged untrue
statement or omission or alleged omission made in said registration statement,
said preliminary prospectus, said final prospectus or said amendment or
supplement in reliance upon and in conformity with written information furnished
by such Distributing Holder for use in the preparation thereof; and will
reimburse the Company or any such director, officer or controlling person for
any legal or other expenses reasonably incurred by them in connection with
investigating or defending any such loss, claim, damage, liability or action.

          (c) Promptly after receipt by an indemnified party under this
paragraph 7 of notice of the commencement of any action, such indemnified party
will, if a claim in respect thereof is to be made against any indemnifying
party, give the indemnifying party notice of the commencement thereof, but the
omission so to notify the indemnifying party will not relieve it from any
liability which it may have to any indemnified party otherwise than under this
paragraph 7.

          (d) In case any such action is brought against any indemnified party,
and it notifies an indemnifying party of the commencement hereof, the
indemnifying party will be entitled to participate in and, to the extent that it
may wish, jointly with any other indemnifying party similarly notified, to
assume the defense thereof, with counsel reasonably satisfactory to such
indemnified party, and after notice from the indemnifying party to such
indemnified party of its election so to assume the defense thereof, the
indemnifying party will not be liable to such indemnified party under this
paragraph 7 for any legal or other expenses subsequently incurred by such
indemnified party in connection with the defense thereof other than reasonable
costs of investigation.

     8.   The Exercise Price in effect at the time and the number and kind of
securities purchasable upon the exercise of the Warrant shall be subject to
adjustment from time to time upon the happening of certain events as follows:

          (a) In case the Company shall (i) declare a dividend or make a
distribution on its outstanding shares of Common Stock in shares of Common Stock
(other than issuance of Common Stock pursuant to antidilution provisions set
forth in the Registration Statement),

                                       7
<PAGE>

(ii) subdivide or reclassify its outstanding shares of Common Stock into a
greater number of shares, (iii) combine or reclassify its outstanding shares of
Common Stock into a smaller number of shares, or (iv) enter into any transaction
whereby the outstanding shares of Common Stock of the Company are at any time
changed into or exchanged for a different number or kind of shares or other
security of the Company or of another corporation through reorganization,
merger, consolidation, liquidation or recapitalization, then appropriate
adjustments in the number of Shares (or other securities for which such Shares
have previously been exchanged or converted) subject to this Representatives'
Warrant shall be made and the Exercise Price in effect at the time of the record
date for such dividend or distribution or of the effective date of such
subdivision, combination, reclassification, reorganization, merger,
consolidation, liquidation or recapitalization shall be proportionately adjusted
so that the Holder of this Representatives' Warrant exercised after such date
shall be entitled to receive the aggregate number and kind of shares of Common
Stock which, if this Representatives' Warrant had been exercised by such Holder
immediately prior to such date, he would have been entitled to receive upon such
dividend, distribution, subdivision, combination, reclassification,
reorganization, merger, consolidation, liquidation or recapitalization. For
example, if the Company declares a 2 for 1 stock distribution and the Exercise
Price hereof immediately prior to such event was $______ per Share and the
number of Shares issuable upon exercise of this Representatives' Warrant was
_________ , the adjusted Exercise Price immediately after such event would be
$_________ per Share and the adjusted number of Shares issuable upon exercise of
this Representatives' Warrant would be ________. Such adjustment shall be made
successively whenever any event listed above shall occur.

          (b) In case the Company shall fix a record date for the issuance of
rights or warrants to all holders of its Common Stock entitling them to
subscribe for or purchase shares of Common Stock (or securities convertible into
Common Stock) at a price (the "Subscription Price") (or having a conversion
price per share) less than the Exercise Price on a per share basis (the "Per
Share Exercise Price") on such record date, the Exercise Price shall be adjusted
so that the same shall equal the price determined by multiplying the number of
Shares by the Per Share Exercise Price in effect immediately prior to the date
of issuance by a fraction, the numerator of which shall be the sum of the number
of shares of Common Stock then outstanding on the record date mentioned below
and the number of additional shares of Common Stock which the aggregate offering
price of the total number of shares of Common Stock so offered (or the aggregate
conversion price of the convertible securities so offered) would purchase at the
Per Share Exercise Price in effect immediately prior to the date of such
issuance, and the denominator of which shall be the sum of the number of shares
of Common Stock outstanding on the record date mentioned below and the number of
additional shares of Common Stock offered for subscription or purchase (or into
which the convertible securities so offered are convertible). Such adjustment
shall be made successively whenever such rights or warrants are issued and shall
become effective immediately after the record date for the determination of
stockholders entitled to receive such rights or warrants; and to the extent that
shares of Common Stock are not delivered (or securities convertible into Common
Stock are not delivered) after the expiration of such rights or warrants the
Exercise Price shall be readjusted to the Exercise Price which would

                                       8
<PAGE>

then be in effect had the adjustments made upon the issuance of such rights or
warrants been made upon the basis of delivery of only the number of shares of
Common Stock (or securities convertible into Common Stock) actually delivered.

          (c) In case the Company shall hereafter distribute to all holders of
its Common Stock evidences of its indebtedness or assets (excluding cash
dividends or distributions and dividends or distributions referred to in
Subsection (a) above) or subscription rights or warrants (excluding those
referred to in Subsection (b) above), then in each such case the Exercise Price
in effect thereafter shall be determined by multiplying the number of Shares by
the Per Share Exercise Price in effect immediately prior thereto, multiplied by
a fraction, the numerator of which shall be the total number of shares of Common
Stock then outstanding multiplied by the current market price per share of
Common Stock (as defined in Subsection (e) below), less the fair market value
(as determined by the Company's Board of Directors) of said assets, or evidences
of indebtedness so distributed or of such rights or warrants, and the
denominator of which shall be the total number of shares of Common Stock
outstanding multiplied by such current market price per share of Common Stock.
Such adjustment shall be made whenever any such distribution is made and shall
become effective immediately after the record date for the determination of
stockholders entitled to receive such distribution.

          (d) Whenever the Exercise Price payable upon exercise of the
Representatives' Warrant is adjusted pursuant to Subsections (a), (b) or (c)
above, the number of Shares purchasable upon exercise of this Representatives'
Warrant shall simultaneously be adjusted by multiplying the number of Shares
issuable upon exercise of this Representatives' Warrant by the Exercise Price in
effect on the date hereof and dividing the product so obtained by the Exercise
Price, as adjusted.

          (e) For the purpose of any computation under Subsection (c) above, the
current market price per share of Common Stock at any date shall be deemed to be
the average of the daily closing prices of the Common Stock for 30 consecutive
business days before such date. The closing price for each day shall be the last
sale price regular way or, in case no such reported sale takes place on such
day, the average of the last reported bid and asked prices regular way, in
either case on the principal national securities exchange on which the Common
Stock is admitted to trading or listed, or, if not listed or admitted to trading
on such exchange, the average of the highest reported bid and lowest reported
asked prices as reported by NASDAQ, or other similar organization if NASDAQ is
no longer reporting such information, or if not so available, the fair market
price as determined by the Board of Directors as set forth in Section 2(b)
herein.

          (f) No adjustment in the Exercise Price shall be required unless such
adjustment would require an increase or decrease of at least five cents ($0.05)
in such price; provided, however, that any adjustments which may by reason of
this Subsection (f) are not required to be made shall be carried forward and
taken into account in any subsequent adjustment required to be made hereunder.
All calculations under this Section 8 shall be made to the nearest cent or to
the nearest one-hundredth of a share, as the case may be.  Anything in this
Section 8 to

                                       9
<PAGE>

the contrary notwithstanding, the Company shall be entitled, but shall not be
required, to make such changes in the Exercise Price, in addition to those
required by this Section 8, as it shall determine, in its sole discretion, to be
advisable in order that any dividend or distribution in shares of Common Stock,
or any subdivision, reclassification or combination of Common Stock, hereafter
made by the Company shall not result in any Federal income tax liability to the
holders of the Common Stock or securities convertible into Common Stock.

          (g) Whenever the Exercise Price is adjusted, as herein provided, the
Company shall promptly cause a notice setting forth the adjusted Exercise Price
and adjusted number of Shares issuable upon exercise of the Representatives'
Warrant to be mailed to the Holder, at its address set forth herein, and shall
cause a certified copy thereof to be mailed to the Company's transfer agent, if
any.  The Company may retain a firm of independent certified public accountants
selected by the Board of Directors (who may be the regular accountants employed
by the Company) to make any computation required by this Section 8, and a
certificate signed by such firm shall be conclusive evidence of the correctness
of such adjustment.

          (h) In the event that at any time, as a result of an adjustment made
pursuant to the provisions of this Section 8, the Holder of the Representatives'
Warrant thereafter shall become entitled to receive any shares of the Company
other than Common Stock, thereafter the number of such other shares so
receivable upon exercise of the Representatives' Warrant shall be subject to
adjustment from time to time in a manner and on terms as nearly equivalent as
practicable to the provisions with respect to the Common Stock contained in
Subsections (a) to (f), inclusive, above.

     9.   This Agreement shall be governed by and in accordance with the laws of
the State of New York without regard to conflict of laws provision.

     IN WITNESS WHEREOF, WORLDQUEST NETWORKS, INC. has caused this
Representatives' Warrant to be signed by its duly authorized officers under its
corporate seal, and this Representatives' Warrant to be dated ____________,
2000.

                              WORLDQUEST NETWORKS, INC.

                              By:________________________________
                                    B. Michael Adler
                                    Chairman and Chief Executive Officer

Attest:

______________________________
Michael R. Lanham
its President, Chief Operating Officer and Secretary

                                       10
<PAGE>

                                 PURCHASE FORM
                                 -------------

                  (To be signed only upon exercise of Warrant)

     The undersigned, the holder of the foregoing Representatives' Warrant,
hereby irrevocably elects to exercise the purchase rights represented by such
Warrant for, and to purchase thereunder, _______________ Shares of Common Stock,
$.01 par value per share (the "Shares") WORLDQUEST NETWORKS, INC., payment of
$_______ therefor, and requests that the certificates for the Shares issued in
the name(s) of, and delivered to ________________________, whose address(es) is
(are):

Dated:  _______________, ____

                              By:________________________________

                              ___________________________________

                              ___________________________________
                              Address
<PAGE>

                                 TRANSFER FORM
                                 -------------

         (To be signed only upon transfer of Representatives' Warrant)

     For value received, the undersigned hereby sells, assigns, and transfers
unto ______________________________ the right to purchase Shares represented by
the foregoing Representatives' Warrant to the extent of __________ Shares, and
appoints _________________________ attorney to transfer such rights on the books
of _________________ ____________, with full power of substitution in the
premises.  The undersigned believes that each transferee is a permitted
transferee under Section 3 of the Representatives' Warrant.

Dated:  _______________, ____

                              By:________________________________

                              ___________________________________

                              ___________________________________
                              Address

In the presence of:Exhibit 4.1
                                   -----------

                    CONFIDENTIAL PRIVATE PLACEMENT MEMORANDUM

                            ACCREDITED INVESTORS ONLY

                                MCGLEN MICRO INC.
                                 600,000 Shares

                                       of

                                  COMMON STOCK

                                $25,000 Per Unit

              Each Unit Consisting of 10,000 Shares of Common Stock

                    Minimum Offering of 40 Units ($1,000,000)
                    Maximum Offering of 60 Units ($1,500,000)

     McGlen Micro Inc., a California corporation (the "Company" or "McGlen"), is
in the  business of selling  computer  hardware  and  software  via the Internet
through its website at mcglen.com and its  subsidiary  AMT  Component,  Inc., at
accessmicro.com.  McGlen  intends to merge with Adrenalin  Interactive,  Inc., a
Delaware corporation, Nasdaq symbol "ADRN" pursuant to which McGlen shall become
a wholly owned  subsidiary  of  Adrenalin  and the  shareholders  of McGlen will
receive 87.5% of the outstanding shares of Adrenalin.

     This Private Placement Memorandum (this "Memorandum")  relates to the offer
and sale (this  "Offering")  to  accredited  investors  only,  of up to 60 Units
(individually,  a "Unit" and together  "Units"),  each Unit consisting of 10,000
shares (the "Shares") of the Company's Common Stock ("Common Stock").  The Units
will be sold at a subscription price of $25,000 per Unit with a minimum purchase
of one Unit. The minimum number of Units that will be sold in this Offering will
be 40 Units (the "Minimum  Offering")  and the maximum number of Units that will
be sold in this Offering will be 60 Units (the "Maximum Offering").  There is no
market for the securities of the Company. See "RISK FACTORS" and "DESCRIPTION OF
SECURITIES."

     THE  SECURITIES  DESCRIBED  HEREIN  HAVE  NOT  BEEN  REGISTERED  UNDER  THE
SECURITIES ACT OF 1933, AS AMENDED (THE "ACT").  NEITHER THIS MEMORANDUM NOR THE
SECURITIES  DESCRIBED HEREIN HAVE BEEN APPROVED OR DISAPPROVED BY THE SECURITIES
AND  EXCHANGE  COMMISSION  (THE  "COMMISSION")  OR  ANY  OTHER  GOVERNMENTAL  OR
REGULATORY  AGENCY NOR HAS ANY SUCH AGENCY  PASSED UPON THE ADEQUACY OR ACCURACY
OF THIS MEMORANDUM.  ANY  REPRESENTATION  TO THE CONTRARY IS A CRIMINAL OFFENSE.
THE  SECURITIES  OFFERED  HEREBY SHOULD BE CONSIDERED TO BE  SPECULATIVE  AND TO
INVOLVE A HIGH DEGREE OF RISK. SEE "RISK FACTORS."

<TABLE>
<CAPTION>

=================================================================================================
                                     Price to              Selling                Proceeds to the
                                   Investors (1)*      Commissions (2)*              Company (3)*
                                   -------------       ----------------              ------------
      <S>                        <C>                    <C>                       <C>
      Per Share                  $           2.50       $           .25           $          2.25
      Per Unit                   $      25,000.00       $      2,500.00           $     22,500.00
      Total Maximum Offering     $   1,500,000.00       $    150,000.00           $  1,350,000.00
=================================================================================================
                                                                     *Footnotes on following page
</TABLE>

                            REDSTONE SECURITIES, INC.
                The date of this Memorandum is September 30, 1999

                                       18

<PAGE>

                                                 Name:
                                                      --------------------------
                                                 Memorandum No.:
                                                                 ---------------

                                       19

<PAGE>

                             FOOTNOTES TO COVER PAGE
                             -----------------------

         (1) The offering price for each Unit (the "Offering  Price") is payable
in full upon subscription.  The minimum  subscription is $25,000,  however,  the
Company  reserves  the right to accept  subscriptions  for lesser  amounts.  The
Offering Price has been  determined by the Company and is not based on earnings,
assets,  book value or any other recognized  criteria for establishing value. No
representation  is made that the Units or the Shares  have a market  value equal
to, or could be resold at, such price, and each prospective investor should make
an independent evaluation of the fairness of the Offering Price.

         (2) This  Offering  is being  made on a "best  efforts"  basis  through
Redstone  Securities,  Inc. (the  "Placement  Agent").  The Placement Agent will
receive a commission of 10% of the aggregate amount of this Offering.

         (3)  This  figure  represents  the  gross  proceeds  of  this  Offering
available to the Company after  deduction of the Placement  Agent's  commissions
but before  certain  expenses of this  Offering  such as legal fees,  accounting
fees, filing and qualification  fees,  printing costs,  escrow account fees, and
other miscellaneous costs and expenses incurred to sell the Units.

         The Units will be offered until October 15, 1999, which offering period
may be extended for up to an additional 45 days (the "Termination  Date") at the
discretion of the Company and the Placement Agent (the "Offering  Period").  The
Company's counsel,  Boyd & Chang, LLP (the "Escrow Agent") has been appointed as
the escrow agent for the  subscription  of the Units.  The Company has agreed to
indemnify  the Escrow Agent and provide the Escrow Agent with a general  release
for most  liability.  The proceeds of this  Offering  (the  "Proceeds")  will be
deposited in a trust  account  which may be at risk in the event of a failure of
the institution holding such funds once such funds exceed $100,000. See "PLAN OF
DISTRIBUTION."

                                       20

<PAGE>

                                TABLE OF CONTENTS
                                -----------------

PREPARATION BY COMPANY........................................................1

GENERAL INFORMATION...........................................................1

CONFIDENTIAL INFORMATION......................................................1

INVESTOR SUITABILITY STANDARDS................................................2

SUBSCRIPTION PROCEDURE........................................................3

EXECUTIVE SUMMARY.............................................................5

THE OFFERING..................................................................5

RISK FACTORS..................................................................7

THE BUSINESS.................................................................19

MANAGEMENT'S DISCUSSION AND ANALYSIS.........................................27

USE OF PROCEEDS..............................................................35

RECENT TRANSACTIONS..........................................................36

CAPITALIZATION...............................................................39

DILUTION ....................................................................40

MANAGEMENT...................................................................41

EXECUTIVE COMPENSATION.......................................................43

PRINCIPAL SHAREHOLDERS.......................................................45

DESCRIPTION OF SECURITIES....................................................46

TERMS OF THE OFFERING........................................................46

SECURITIES MATTERS AND RESTRICTIONS ON TRANSFERABILITY.......................48

LEGAL MATTERS................................................................49

ADDITIONAL INFORMATION.......................................................49

FINANCIAL STATEMENTS.........................................................50

EXHIBITS

         EXHIBIT  "A" -  Subscription  Agreement  and  Subscriber  Questionnaire
         EXHIBIT "B" - Internal Revenue Service Forms W-8 and W-9

                                       21

<PAGE>

                                     NOTICES
                                     -------

         THIS OFFERING IS  SPECULATIVE  AND INVOLVES A HIGH DEGREE OF RISK.  SEE
"RISK FACTORS." SEE "SECURITIES  MATTERS AND  RESTRICTIONS ON  TRANSFERABILITY."
THIS OFFERING IS MADE ONLY TO  "ACCREDITED  INVESTORS" WHO CAN AFFORD A COMPLETE
LOSS OF THEIR INVESTMENT IN THE COMPANY. SEE "INVESTOR SUITABILITY STANDARDS."

                                      * * *

         NO REPRODUCTION  OR DISTRIBUTION OF THIS MEMORANDUM IS PERMITTED.  THIS
MEMORANDUM  CONSTITUTES AN OFFER TO SELL, OR THE SOLICITATION OF AN OFFER TO BUY
ONLY  TO THE  PERSON  WHOSE  NAME  APPEARS  ON  THE  COVER  PAGE,  AND  ONLY  IN
JURISDICTIONS IN WHICH SUCH OFFER, SOLICITATION OR SALE WOULD BE LAWFUL PRIOR TO
REGISTRATION OR QUALIFICATION  UNDER APPLICABLE  SECURITIES LAWS.  OFFERS MAY BE
MADE ONLY TO PERSONS WHO ARE "ACCREDITED  INVESTORS" (AS DEFINED IN REGULATION D
UNDER THE ACT).

                                      * * *

         THIS MEMORANDUM SHALL BE TREATED AS  CONFIDENTIAL.  ANY REPRODUCTION IN
WHOLE OR IN PART, OR DISTRIBUTION OF THIS  MEMORANDUM,  OR THE DIVULGENCE OF ANY
OF ITS CONTENTS TO ANY PERSON WITHOUT THE PRIOR WRITTEN  CONSENT OF THE COMPANY,
IS PROHIBITED.

                                      * * *

         PROSPECTIVE INVESTORS MUST NOT CONSTRUE THE CONTENTS OF THIS MEMORANDUM
AS  INVESTMENT,  LEGAL OR TAX  ADVICE.  EACH  INVESTOR  SHOULD  CONSULT  HIS OWN
INVESTMENT ADVISER,  LEGAL COUNSEL AND TAX ADVISER AS TO, LEGAL, TAX AND RELATED
MATTERS CONCERNING THIS INVESTMENT.

                                      * * *

         NO OFFERING  LITERATURE OR ADVERTISING IN WHATEVER FORM MAY BE EMPLOYED
IN THIS  OFFERING OF THE UNITS  EXCEPT FOR THIS  MEMORANDUM.  NO PERSON HAS BEEN
AUTHORIZED  TO MAKE ANY  REPRESENTATION  WITH  RESPECT  TO THE UNITS  EXCEPT THE
REPRESENTATIONS   CONTAINED   HEREIN.   NO  RELIANCE  MAY  BE  PLACED  UPON  ANY
REPRESENTATIONS,  OTHER THAN  THOSE SET FORTH IN THIS  MEMORANDUM.  NEITHER  THE
DELIVERY  OF THIS  MEMORANDUM,  NOR ANY SALE  MADE  HEREUNDER  SHALL,  UNDER ANY
CIRCUMSTANCES,  CREATE  AN  IMPLICATION  THAT  THERE  HAS BEEN NO  CHANGE IN THE
MATTERS SET FORTH HEREIN SINCE THE DATE OF THIS MEMORANDUM.

                                       22

<PAGE>

                                      * * *

         THE  UNITS  AND THE  COMMON  STOCK  WHICH  COMPRISE  THE  UNITS ARE NOT
REGISTERED  UNDER THE ACT. THEY ARE SUBJECT TO RESTRICTIONS  ON  TRANSFERABILITY
AND RESALE AND MAY NOT BE  TRANSFERRED  OR RESOLD EXCEPT AS PERMITTED  UNDER THE
ACT AND APPLICABLE STATE SECURITIES LAWS,  PURSUANT TO REGISTRATION OR EXEMPTION
THEREFROM.  INVESTORS  SHOULD BE AWARE  THAT THEY WILL BE  REQUIRED  TO BEAR THE
SIGNIFICANT RISKS OF THIS INVESTMENT FOR AN INDEFINITE PERIOD OF TIME.

                                      * * *

         THIS  OFFERING IS BEING MADE IN RELIANCE  UPON THE  AVAILABILITY  OF AN
EXEMPTION FROM THE REGISTRATION PROVISIONS OF THE ACT BY VIRTUE OF THE COMPANY'S
INTENDED  COMPLIANCE  WITH THE  PROVISIONS  OF SECTION 4(2) THEREOF AND RULE 506
ADOPTED BY THE COMMISSION  THEREUNDER.  THE  SECURITIES  OFFERED HEREBY HAVE NOT
BEEN REGISTERED  WITH, OR APPROVED OR DISAPPROVED BY, THE COMMISSION,  OR BY THE
SECURITIES  REGULATORY  AUTHORITY OF ANY STATE,  NOR HAS THE  COMMISSION  OR ANY
AUTHORITY PASSED UPON OR ENDORSED THE MERITS OF THIS OFFERING OR THE ACCURACY OR
ADEQUACY OF THIS  MEMORANDUM.  ANY  REPRESENTATION  CONTRARY TO THE FOREGOING IS
UNLAWFUL.

                                      * * *

         THIS  OFFERING  CAN BE  WITHDRAWN  BY THE  COMPANY  AT ANY TIME  BEFORE
CONSUMMATION  AND IS  SPECIFICALLY  MADE SUBJECT TO THE CONDITIONS  DESCRIBED IN
THIS  MEMORANDUM.  IN CONNECTION  WITH THIS OFFERING AND SALE OF THE UNITS,  THE
COMPANY RESERVES THE RIGHT, IN ITS SOLE DISCRETION, TO REJECT ANY SUBSCRIPTION.

                                      * * *

         STATEMENTS  CONTAINED  HEREIN AS TO THE  CONTENTS OF ANY  AGREEMENT  OR
OTHER  DOCUMENTS ARE SUMMARIES AND,  THEREFORE,  ARE  NECESSARILY  SELECTIVE AND
INCOMPLETE.  COPIES OF THE DOCUMENTS REFERRED TO HEREIN MAY BE OBTAINED FROM THE
COMPANY AND ARE AVAILABLE FOR INSPECTION AT THE OFFICES OF THE COMPANY.

                                      * * *

         IF ANY PERSON  ELECTS NOT TO MAKE AN OFFER TO  ACQUIRE  THE  SECURITIES
OFFERED  HEREBY OR SUCH OFFER IS REJECTED IN WHOLE BY THE COMPANY,  SUCH PERSON,
BY ACCEPTING DELIVERY OF THIS MEMORANDUM,

                                       23

<PAGE>

AGREES TO RETURN THIS MEMORANDUM AND ALL RELATED DOCUMENTS  ENCLOSED HEREWITH OR
FURNISHED SUBSEQUENTLY, TO THE COMPANY AT ITS OFFICES AT MCGLEN MICRO INC., 3002
DOW AVENUE, SUITE 212, TUSTIN, CALIFORNIA 92780.
                                      * * *

         SALES OF THE UNITS CAN BE CONSUMMATED ONLY BY ACCEPTANCE BY THE COMPANY
OF OFFERS TO  PURCHASE  SUCH  SECURITIES  WHICH ARE  TENDERED  TO THE COMPANY BY
PROSPECTIVE  INVESTORS.  NO  SOLICITATION  OF  ANY  SUCH  OFFER  (INCLUDING  ANY
SOLICITATION  WHICH MAY BE CONSTRUED AS AN "OFFER"  UNDER  FEDERAL  AND/OR STATE
SECURITIES LAWS) TO SUCH PROSPECTIVE  INVESTORS IS AUTHORIZED  WITHOUT THE PRIOR
APPROVAL BY THE COMPANY.

                                      * * *

         PROSPECTIVE INVESTORS AND THEIR AUTHORIZED REPRESENTATIVES, ACCOUNTANTS
AND  ATTORNEYS ARE  ENCOURAGED TO ASK QUESTIONS OF AND RECEIVE  ANSWERS FROM THE
COMPANY  CONCERNING  THE TERMS AND  CONDITIONS  OF THIS  OFFERING  AND TO OBTAIN
ADDITIONAL  INFORMATION  CONCERNING  THE  COMPANY  OR  NECESSARY  TO VERIFY  THE
ACCURACY OF ANY OF THE INFORMATION  CONTAINED HEREIN OR IN ANY DOCUMENT REFERRED
TO HEREIN OR DELIVERED IN CONNECTION HEREWITH.

         INVESTORS  AND  THEIR  AUTHORIZED  REPRESENTATIVES  SHOULD  REVIEW  THE
FOLLOWING  LEGENDS  REQUIRED  BY  CERTAIN  JURISDICTIONS  AND BE  AWARE OF THEIR
CONTENTS.  PLEASE REVIEW THE FOLLOWING  MATERIAL  CAREFULLY TO DETERMINE WHETHER
ANY OF THESE LEGENDS APPLY.

                            STATE NOTICES AND LEGENDS
                            -------------------------

FOR RESIDENTS OF ALL STATES
---------------------------

         IN  MAKING AN  INVESTMENT  DECISION,  INVESTORS  MUST RELY ON THEIR OWN
EXAMINATION OF THE PERSON OR ENTITY  CREATING THESE  SECURITIES AND THE TERMS OF
THIS OFFERING,  INCLUDING THE MERITS AND RISKS INVOLVED.  THESE  SECURITIES HAVE
NOT BEEN RECOMMENDED BY ANY FEDERAL OR STATE SECURITIES COMMISSION OR REGULATORY
AUTHORITY.  FURTHERMORE,  THE  FOREGOING  AUTHORITIES  HAVE  NOT  CONFIRMED  THE
ACCURACY OR DETERMINED THE ADEQUACY OF THIS DOCUMENT.  ANY REPRESENTATION TO THE
CONTRARY IS A CRIMINAL OFFENSE.

         THESE  SECURITIES ARE SUBJECT TO  RESTRICTIONS ON  TRANSFERABILITY  AND
RESALE AND MAY NOT BE  TRANSFERRED  OR RESOLD EXCEPT AS PERMITTED  UNDER THE ACT

                                       24

<PAGE>

AND THE APPLICABLE STATE SECURITIES LAWS,  PURSUANT TO REGISTRATION OR EXEMPTION
THEREFROM.  INVESTORS  SHOULD BE AWARE  THAT THEY WILL BE  REQUIRED  TO BEAR THE
FINANCIAL RISKS OF THIS INVESTMENT FOR AN INDEFINITE PERIOD OF TIME.

                           SPECIFIC STATE DISCLOSURES
                           --------------------------

         THE  SECURITIES  OFFERED  HEREBY  HAVE NOT  BEEN  REGISTERED  WITH,  OR
APPROVED OR DISAPPROVED BY, THE COMMISSION OR ANY STATE  SECURITIES  COMMISSION,
NOR HAS THE  COMMISSION  OR ANY  STATE  SECURITIES  COMMISSION  PASSED  UPON THE
ACCURACY OR ADEQUACY OF THIS MEMORANDUM. ANY REPRESENTATION TO THE CONTRARY IS A
CRIMINAL OFFENSE.

CALIFORNIA
----------

         IT IS UNLAWFUL FOR THE HOLDER OF ANY  SECURITY TO  CONSUMMATE A SALE OR
TRANSFER  OF  THIS  SECURITY,  OR  ANY  INTEREST  THEREIN,  OR  TO  RECEIVE  ANY
CONSIDERATION  THEREFORE,  WITHOUT THE PRIOR WRITTEN CONSENT OF THE COMMISSIONER
OF  CORPORATIONS  OF  THE  STATE  OF  CALIFORNIA,  EXCEPT  AS  PERMITTED  IN THE
COMMISSIONER'S RULES.

         THE SALE OF THE SECURITIES WHICH ARE THE SUBJECT OF THIS MEMORANDUM HAS
NOT BEEN  QUALIFIED  WITH  THE  COMMISSIONER  OF  CORPORATIONS  OF THE  STATE OF
CALIFORNIA  AND THE ISSUANCE OF THE  SECURITIES OR THE PAYMENT OR RECEIPT OF ANY
PART OF THE  CONSIDERATION  THEREFOR  PRIOR TO THE  QUALIFICATION  IS  UNLAWFUL,
UNLESS  THE SALE OF  SECURITIES  IS EXEMPT  FROM THE  QUALIFICATIONS  BY SECTION
25100,  25102 OR 25105 OF THE  CALIFORNIA  CORPORATIONS  CODE. THE RIGHTS OF ALL
PARTIES TO THIS  MEMORANDUM  ARE EXPRESSLY  CONDITIONED  UPON THE  QUALIFICATION
BEING OBTAINED UNLESS THE SALE IS SO EXEMPT.

FLORIDA
-------

         THESE SECURITIES HAVE NOT BEEN REGISTERED UNDER THE FLORIDA  SECURITIES
AND INVESTOR  PROTECTION  ACT AND ARE BEING SOLD IN RELIANCE  UPON THE EXEMPTION
CONTAINED IN SECTION 517.061(11) OF SUCH ACT.

         FLORIDA LAW  PROVIDES  THAT WHEN SALES ARE MADE TO FIVE OR MORE PERSONS
IN FLORIDA,  ANY SALE MADE IN FLORIDA IS VOIDABLE BY THE PURCHASER  WITHIN THREE
DAYS AFTER THE FIRST TENDER OF  CONSIDERATION  IS MADE BY SUCH  PURCHASER TO THE
COMPANY,  AN AGENT OF THE COMPANY OR AN ESCROW  AGENT OR WITHIN THREE DAYS AFTER
THE AVAILABILITY OF THAT PRIVILEGE IS COMMUNICATED TO SUCH PURCHASER, WHICHEVER

                                       25

<PAGE>

OCCURS LATER. THIS OFFERING  INVOLVES SALES IN FLORIDA.  PAYMENTS FOR TERMINATED
SUBSCRIPTIONS WILL BE PROMPTLY REFUNDED WITHOUT INTEREST.

         AS REQUIRED BY SECTION 517.061(11)(A)3,  FLORIDA STATUTES, AND RULE 3E-
500.05(5)(A)  PROMULGATED THEREUNDER,  PROSPECTIVE INVESTORS AND THEIR PURCHASER
REPRESENTATIVES  MAY HAVE, AT THE OFFICES OF THE COMPANY AT ANY REASONABLE HOUR,
AFTER  REASONABLE  PRIOR NOTICE,  ACCESS TO THE MATERIALS SET FORTH IN THE RULE,
ANY OTHER  MATERIALS  RELATING TO THE COMPANY,  THE  OFFERING  DESCRIBED IN THIS
MEMORANDUM OR ANYTHING SET FORTH IN THIS MEMORANDUM WHICH THE COMPANY CAN OBTAIN
WITHOUT UNREASONABLE EFFORT OR EXPENSE. SEE "ADDITIONAL  INFORMATION." NO PERSON
IS AUTHORIZED  TO MAKE ANY  REPRESENTATION  WHICH IS NOT IN CONFORMITY  WITH THE
INFORMATION  CONTAINED HEREIN AND ANY SUCH  REPRESENTATIONS  SHALL NOT BE RELIED
UPON. ILLINOIS

         THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECRETARY
OF STATE OF ILLINOIS OR THE STATE OF ILLINOIS, NOR HAS THE SECRETARY OF STATE OF
ILLINOIS  PASSED  UPON  THE  ACCURACY  OR  ADEQUACY  OF THIS  PRIVATE  PLACEMENT
MEMORANDUM. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.

         THE SECURITIES OFFERED HEREBY INVOLVE A HIGH DEGREE OF RISK.

         THESE  SECURITIES  HAVE  NOT BEEN  REGISTERED  UNDER  SECTION  5 OF THE
ILLINOIS  SECURITIES ACT OF 1953. THE SECURITIES MAY NOT BE RESOLD,  TRANSFERRED
OR OTHERWISE DISPOSED OF TO ANY PERSON OR ENTITY UNLESS SUBSEQUENTLY  REGISTERED
UNDER  THE  ILLINOIS  SECURITIES  ACT  OF  1953  OR  UNLESS  AN  EXEMPTION  FROM
REGISTRATION THEREFROM IS AVAILABLE.

NEW JERSEY
----------

         THESE   SECURITIES  ARE  OFFERED  IN  RELIANCE  ON  AN  EXEMPTION  FROM
REGISTRATION  UNDER THE NEW JERSEY UNIFORM  SECURITIES  LAW. THE SECURITIES HAVE
NOT  BEEN  REGISTERED  UNDER  SAID  LAW  AND  MAY NOT BE  RE-OFFERED  FOR  SALE,
TRANSFERRED OR RESOLD WITHOUT  COMPLIANCE  WITH THE  REGISTRATION  PROVISIONS OF
SAID LAW OR AN EXEMPTION  THEREFROM.  THE BUREAU OF SECURITIES OF NEW JERSEY HAS
NOT PASSED UPON THE ACCURACY OR  COMPLETENESS  OF THIS  MEMORANDUM  AND DOES NOT
RECOMMEND OR ENDORSE THE PURCHASE OF THE UNITS.

                                       26

<PAGE>

NEW YORK
--------

         THIS  CONFIDENTIAL  PRIVATE  PLACEMENT  MEMORANDUM  DOES NOT  KNOWINGLY
CONTAIN ANY UNTRUE  STATEMENT OF A MATERIAL  FACT OR  KNOWINGLY  OMIT TO STATE A
MATERIAL  FACT  NECESSARY  TO MAKE  THE  STATEMENTS  MADE,  IN THE  LIGHT OF THE
CIRCUMSTANCES  UNDER WHICH THEY WERE MADE,  NOT  MISLEADING.  IT CONTAINS A FAIR
SUMMARY OF THE MATERIAL TERMS OF DOCUMENTS PURPORTED TO BE SUMMARIZED HEREIN.

         THIS  MEMORANDUM  HAS NOT BEEN FILED WITH OR REVIEWED  BY THE  ATTORNEY
GENERAL OF THE STATE OF NEW YORK PRIOR TO ITS  ISSUANCE  AND USE.  THE  ATTORNEY
GENERAL  OF THE STATE OF NEW YORK HAS NOT PASSED ON NOR  ENDORSED  THE MERITS OF
THIS OFFERING. ANY REPRESENTATION TO THE CONTRARY IS UNLAWFUL.

         ALL NEW  YORK  INVESTORS  WILL  BE  REQUIRED  TO  REPRESENT  THAT  THEY
UNDERSTAND THAT THE OFFERING MAY BE MADE ONLY TO THOSE NON-ACCREDITED  RESIDENTS
OF NEW YORK WHO HAVE A NET WORTH (ALONE OR JOINTLY WITH A SPOUSE,  BUT EXCLUSIVE
OF  HOME,  FURNISHINGS  AND  AUTOMOBILES)  OF  THREE  TIMES  THE  AMOUNT  OF THE
INVESTMENT  AND AN ADJUSTED  GROSS INCOME  (ALONE OR JOINTLY WITH A SPOUSE,  BUT
EXCLUSIVE OF HOME, HOME FURNISHINGS AND AUTOMOBILES) OF FIVE TIMES THE AMOUNT OF
THE INVESTMENT.

         THESE  SECURITIES ARE SUBJECT TO  RESTRICTIONS ON  TRANSFERABILITY  AND
RESALE AND MAY NOT BE  TRANSFERRED  OR RESOLD EXCEPT AS PERMITTED  UNDER THE ACT
AND THE  APPLICABLE  STATE  SECURITIES  LAWS,  PURSUANT TO THE  REGISTRATION  OR
EXEMPTION  THEREFROM.  INVESTORS  SHOULD BE AWARE THAT THEY WILL BE  REQUIRED TO
BEAR THE FINANCIAL RISKS OF THIS INVESTMENT FOR AN INDEFINITE PERIOD OF TIME.

         THE COMPANY WILL ONLY ACCEPT SUBSCRIPTIONS FROM ACCREDITED INVESTORS IN
THIS STATE FOR WHOM THE INVESTMENT IS SUITABLE UPON THE BASIS OF FACTS DISCLOSED
BY THAT INVESTOR IN THE SUBSCRIPTION DOCUMENTS, AND IF THE INVESTOR EITHER ALONE
OR WITH ITS  REPRESENTATIVE  HAS SUCH  KNOWLEDGE AND EXPERIENCE IN FINANCIAL AND
BUSINESS  MATTERS THAT IT IS CAPABLE OF  EVALUATING  THE MERITS AND RISKS OF THE
PROSPECTIVE INVESTMENTS.

ALL STATES
----------

         THE  PRESENCE  OF A LEGEND  FOR ANY GIVEN  STATE  REFLECTS  ONLY THAT A
LEGEND MAY BE  REQUIRED  BY THAT STATE AND  SHOULD NOT BE  CONSTRUED  TO MEAN AN
OFFER  OR SALE  MAY BE MADE IN ANY  PARTICULAR  STATE.  THIS  MEMORANDUM  MAY BE
SUPPLEMENTED BY ADDITIONAL STATE LEGENDS.  IF YOU ARE UNCERTAIN AS TO WHETHER OR

                                       27

<PAGE>

NOT OFFERS OR SALES MAY BE LAWFULLY MADE IN ANY GIVEN STATE,  YOU ARE ADVISED TO
CONTACT THE COMPANY FOR A CURRENT LIST OF STATES IN WHICH OFFERS OR SALES MAY BE
LAWFULLY MADE.

         PRIOR TO ANY SALE HEREUNDER, EACH POTENTIAL INVESTOR AND HIS AUTHORIZED
REPRESENTATIVE(S),  IF ANY, ARE INVITED TO ASK QUESTIONS  AND OBTAIN  ADDITIONAL
INFORMATION FROM THE AUTHORIZED  REPRESENTATIVES  OF THE COMPANY  CONCERNING THE
TERMS AND  CONDITIONS  OF THIS  OFFERING,  THE  COMPANY  AND ANY OTHER  RELEVANT
MATTERS  (INCLUDING  BUT NOT  LIMITED TO  ADDITIONAL  INFORMATION  TO VERIFY THE
ACCURACY  OF THE  INFORMATION  INCLUDED  HEREIN),  TO  THE  EXTENT  THE  COMPANY
POSSESSES  SUCH  INFORMATION  OR CAN ACQUIRE IT WITHOUT  UNREASONABLE  EFFORT OR
EXPENSE.  CONTACT MR. GEORGE LEE, MCGLEN MICRO INC., 3002 DOW AVENUE, SUITE 212,
TUSTIN, CALIFORNIA 92780.

                                       28

<PAGE>

                             PREPARATION BY COMPANY

         The  information  contained in this  Memorandum  has been  supplied and
prepared by McGlen Micro, Inc. and its officers. Neither counsel for the Company
nor the Placement  Agents have verified  this  information  and such counsel has
acted only as  scriveners to convey the  information  provided by the Company at
the request of the Company.

                               GENERAL INFORMATION

         Prospective   investors  should  not  construe  the  contents  of  this
Memorandum  or any written or oral  communications  from McGlen,  the  Placement
Agent or their  employees,  agents or affiliates,  as tax, legal,  investment or
other advice. Each prospective investor must rely solely upon the investor's own
representatives  as to tax,  legal,  accounting,  investment and related matters
concerning an investment in the Company and a purchase of Units.

         The obligations of the parties to this transaction are set forth in and
governed  by  the  documents  referred  to in  this  Memorandum.  No  person  is
authorized to give any information or to make any statement,  representation  or
warranty  not  contained in this  Memorandum.  Any such  information  may not be
relied upon as having been  authorized  by the  Company.  Prospective  investors
should carefully review all of the information  contained in this Memorandum and
each of the  exhibits  hereto,  especially  the Risk  Factors,  and  consult the
Company with any further  questions  concerning  the Company or the  information
contained in this Memorandum.

         The Company's  books and records are kept at the  executive  offices of
the Company at 3002 Dow  Avenue,  Suite 212,  Tustin,  92780.  Each  prospective
investor or the investor's authorized  representative may review these documents
at any reasonable time. The Company's  officers will answer any questions raised
by prospective investors or their authorized  representatives in connection with
this  Offering  and will  provide  the  investors  with any  additional  related
information  available to such officers,  or such additional related information
that can be acquired without unreasonable effort or expense.

         Neither  the  delivery  of this  Memorandum  nor any sales of the Units
under any  circumstances  create an implication that there has been no change in
the matters discussed in this Memorandum since the date hereof.

                            CONFIDENTIAL INFORMATION

        This   Memorandum  and  all  matters   contained   herein  are  strictly
confidential  and  proprietary to the Company.  Each person  receiving a copy of
this Memorandum,  by accepting such delivery, shall be deemed to have agreed not
to disclose to others or to use any of the information  herein  contained except
for purposes of evaluating with the investor's  financial  advisor an investment
in the Units and to return  same to the  Company if the  investors  elect not to
subscribe.

                                        1

<PAGE>

                         INVESTOR SUITABILITY STANDARDS

        An  investment  in the Units  should be  considered  to be  speculative,
involves a high degree of risk, and is suitable only for prospective  purchasers
who  have  sufficient  financial  means  to bear  such  risks,  who  have  other
substantial  assets to provide for current  needs and future  contingencies  and
therefore have no need for immediate  liquidity with respect to this investment,
and who  could  withstand  a total  loss of  this  investment.  No  registration
statement has been or will be filed with the  Commission in connection  with the
offer and sale of the Units.  Consequently,  sales of the Units  offered  hereby
will be made only to prospective  purchasers who are  "accredited  investors" as
that term is defined in Rule 501(a) of Regulation D  promulgated  under the Act.
Certain  sales of the  Units  made  outside  the  United  States  may be made in
reliance  on  Regulation  S  promulgated  under the Act,  to  non-U.S.  persons.
Subscribers  purchasing  Units  offered in reliance  upon  Regulation  S will be
required to execute a Regulation S Subscription  Agreement,  copies of which are
available  upon request from the Company or the  Placement  Agent.  Nonetheless,
suitability  standards will be imposed as necessary to comply with the exemption
of this Offering from any applicable  foreign,  federal or state registration or
qualification requirements or for any other reasons the Company deems prudent.

        The Company will require that each  investor  represents in writing that
the investor is an  "accredited  investor"  within the meaning of Rule 501(a) of
Regulation D. Pursuant to Rule 501(a), an individual  investor must either:  (i)
have (along with a spouse) a net worth which  exceeds  $1,000,000 at the time of
the  purchase;  or (ii) have had an  individual  income in excess of $200,000 in
1997 and 1998 (or joint income with a spouse which exceeds  $300,000) and have a
reasonable expectation of reaching the same income level (or joint income level)
in 1999.  Accredited  investors under Rule 501(a) also include:  (i) any bank or
savings and loan association acting in its individual or fiduciary capacity, any
broker-dealer,  any insurance company,  investment company, business development
company,  small business  investment company or employee benefit plan (a) if the
investment  decision  is made by a fiduciary  which is a bank,  savings and loan
association,  insurance company or registered  investment advisor, or (b) if the
plan has total assets in excess of $5,000,000,  or (c) if a self-directed  plan,
the  investment  decisions  are made  solely  by  persons  that  are  accredited
investors; (ii) any private business development company; (iii) any organization
under  section  501(c)(3) of the Internal  Revenue Code of 1986,  as amended,  a
corporation,  a Massachusetts or similar  business trust, or a partnership,  not
formed for the specific purpose of acquiring the securities offered,  with total
assets  in  excess  of  $5,000,000;  (iv) any  trust  with  assets  in excess of
$5,000,000, not formed for the purpose of buying the securities, the purchase of
which is directed by a "sophisticated"  investor;  (v) any director or executive
officer  of the  Company;  and (vi) any  entity in which all  equity  owners are
accredited  investors.  In addition,  various jurisdictions may have established
higher or additional suitability standards for their residents.  The suitability
standards  referred to above  represent  minimum  suitability  requirements  for
prospective  investors and the  satisfaction  of such standards by a prospective
investor does not necessarily mean that the Units are a suitable  investment for
such prospective investor.  The Company may make such further inquiry and obtain
such  additional  information  as  it  deems  appropriate  with  regard  to  the
suitability of prospective investors in order to comply with applicable state or
local laws, rules, regulations or otherwise.

                                        2

<PAGE>

        Each  prospective  investor  must execute and deliver to the Company the
Subscriber  Questionnaire  and the  Subscription  Agreement  attached  hereto as
Exhibit "A" (the  "Subscription  Documents")  in  accordance  with the procedure
described  below.  All  U.S.  investors  must  complete  an IRS form W-9 and all
foreign  investors  must complete an IRS form W-8,  copies of which are attached
hereto as Exhibit "B".  The  Subscription  Documents  will be relied upon by the
Company in accepting a prospective  investor's  subscription  for the Units. The
Company, in its sole discretion,  will have the right to require other documents
or  to  refuse  any  subscription  for  any  reason  without  liability  to  the
subscriber.

        In  addition  to meeting  these  standards  pertaining  to the  economic
ability of the proposed investor to undertake the risks inherent in the purchase
of the Units,  each  prospective  investor will also be required to represent in
writing,  among other things,  that such investor has either: (i) a pre-existing
business or personal  relationship  with the executive  officers or directors of
the Company;  or (ii) such  knowledge  and  experience in financial and business
matters that such investor is capable of  evaluating  the merits and risks of an
investment in the Units and of making an informed  investment  decision,  or has
retained an attorney,  accountant or other financial or business  advisor who is
able on behalf of the  investor  to  evaluate  the  merits  and risks of such an
investment and to make an informed investment decision with respect thereto. See
"TERMS OF THE OFFERING and RISK FACTORS."

        EACH  PROSPECTIVE  INVESTOR  SHOULD  REALIZE  THAT  SATISFACTION  OF THE
FOREGOING MINIMUM SUITABILITY  STANDARDS DOES NOT NECESSARILY  DETERMINE THAT AN
INVESTMENT IN THE UNITS IS APPROPRIATE FOR SUCH PERSON.

        Each  investor  will also be  required to  represent  that the Units are
being   acquired  for  investment  and  not  with  any  intention  of  making  a
distribution  or resale of the Units,  and to agree to certain  restrictions  on
future transferability of the Units. For these reasons, a purchaser of the Units
must be willing and able to bear the economic risk of such an investment  for an
indefinite period of time.

                             SUBSCRIPTION PROCEDURE

        The execution of a Subscription Agreement constitutes a binding offer to
purchase the Units and an agreement to hold open the offer to purchase the Units
until the subscription is accepted or rejected by the Company.  No subscriptions
will  be  valid  unless  accepted  in  writing  by an  officer  of the  Company.
Prospective investors who wish to invest must deliver the following items:

        1.  One  originally  executed  Subscription   Agreement  and  Subscriber
Questionnaire  with all blanks completed (in the form attached hereto as Exhibit
"A");

        2. A check payable to the order of "Boyd & Chang,  LLP,  Attorney Client
Trust  Account "B", as Escrow Agent for McGlen Micro Inc., in the full amount of
the subscription.

        3. A Form W-8 or a Form  W-9 (in the form  attached  hereto  as  Exhibit
"B").

        The completed  Subscription  Documents and the check for the full amount
subscribed should be returned to the Placement Agent. Wire transfers may be made
directly to the Escrow Agent at:

                                        3

<PAGE>

             Boyd & Chang, LLP Attorney-Client Trust Account "B"
             National Bank of Southern California
             4100 Newport Place, Newport Beach, California
             Telephone:  (949) 863-2300
             ABA routing number 122239801, Acct. No. 04050207

        The Proceeds will be held by the Escrow Agent in an non-interest bearing
account until a closing (a "Closing") of the Minimum Offering, at which time the
subscriptions  accepted  by the Company  will be  deposited  into the  Company's
operating  account to be used in accordance with the purposes  described herein.
Thereafter,  the Company may continue to sell the Units until the earlier of the
sale of all the Units or  October  15,  1999 (or any  extension  thereof  at the
option of the Company).  Upon the acceptance of each  Subscription  Agreement by
the Company: (i) the net proceeds will be delivered to the Company; and (ii) the
investor  will become a holder of the Shares for which the Company has  accepted
subscriptions.
                                EXECUTIVE SUMMARY

        THE FOLLOWING IS A PARTIAL  SUMMARY OF THIS  MEMORANDUM  AND IS INTENDED
ONLY FOR  CONVENIENT  REFERENCE  AND SHOULD NOT BE CONSIDERED  COMPREHENSIVE  OR
COMPLETE.  NO PROSPECTIVE INVESTOR SHOULD SUBSCRIBE FOR UNITS UNTIL THE INVESTOR
HAS CAREFULLY  REVIEWED THE ENTIRE  MEMORANDUM,  INCLUDING  RISK FACTORS AND ALL
EXHIBITS,  AND HAS CONSULTED WITH THE INVESTOR'S  PERSONAL,  LEGAL,  ACCOUNTING,
BUSINESS OR FINANCIAL ADVISORS.

        The  Company.  McGlen  Micro  Inc.,  is a global  Internet  retailer  of
computers,  hardware and peripheral products,  which services small offices/home
offices,  technically oriented computer hardware users and corporate purchasers.
McGlen offers  approximately  85,000 SKU's at its virtual superstore and that of
its  subsidiary  AccessMicro.com  and  currently  has a  customer  list  of over
170,000.

        The  Offering.  The Company is  offering up to 600,000  shares of Common
Stock in 10,000  Share  Units at a price of $25,000 per Unit,  for an  aggregate
offering price of $1,500,000 (before paying commissions and the expenses of this
Offering).  Upon the sale of the Minimum Offering of 40 Units, a closing will be
held and the Company will cause the Escrow Agent to disburse the Proceeds to the
Company after the payment of all  commissions,  fees and costs  associated  with
this  Offering.  Additional  closings  may be held from  time to time  until the
earlier to occur of the sale of all of the Units or the  Termination  Date.  The
Units will be sold only to accredited investors. See "DESCRIPTION OF SECURITIES"
and "INVESTOR SUITABILITY STANDARDS."

        Plan of  Distribution.  The Units are being offered on a "best  efforts"
basis by Redstone  Securities,  Inc., and in certain instances at the discretion
of the  Placement  Agent  through other  participating  NASD member  firms.  The
Placement  Agent  will be paid a  commission  of 10% from  each  Unit it  sells.
Persons  desiring to purchase  Units will be required to  complete,  execute and
deliver the Subscription  Documents to the Placement  Agent.  See  "SUBSCRIPTION
PROCEDURE."

        Use of Proceeds.  Assuming that either the minimum or maximum  number of
Units are sold,  the net proceeds to be received by the Company from the sale of
the Units  are  estimated  to be  approximately  $900,000  to  1,350,000,  after
deducting  commissions  but prior to deducting the expenses  connected with this
Offering. The net proceeds will be used for the continued  implementation of the
Company's  business plan, sales and marketing,  website  enhancement and general
working capital until the close of the Company's proposed merger with Adrenalin.
See "USE OF PROCEEDS."

                                        4

<PAGE>
                                  The Offering

Issuer:              McGlen Micro Inc., a California corporation.

Securities Offered:           Up to 600,000 shares of Common Stock

Purchase Price:               $25,000 per Unit ($2.50 per Share)

Aggregate
Offering Price:               $1,500,000 (600,000 Shares)

Use of Proceeds:              The Company  will use the net  proceeds for sales,
                              marketing, website enhancement and general working
                              capital. See "USE OF PROCEEDS."

Capital Structure:            The  Company  is  authorized  to issue  50,000,000
                              shares  of Common  Stock,  no par  value,  and has
                              25,770,000 shares of Common Stock outstanding.

Information                   Rights:  The Company will  furnish  holders of the
                              Units with annual  financial  statements  together
                              with such information and commentary by management
                              as is usual  and  customary.  The  holders  of the
                              Units will also be  entitled  to receive all other
                              information  provided  by the Company to the other
                              holders of Common Stock.

Voting Rights:                Each share of Common Stock shall have one vote.

Risk Factors:                 The  Units and the  Common  Stock  comprising  the
                              Units are  subject  to  numerous  and  substantial
                              risks,   some  of  which  are  described  in  this
                              Memorandum. See "RISK FACTORS."

Investor Suitability:         The  Units  will  be  offered  and  sold  only  to
                              accredited  investors.  Standards:  See  "INVESTOR
                              SUITABILITY STANDARDS."

Offering                      This  Offering  will  terminate on the earlier of:
                              (i)  the  sale  of all of  the  Termination  Date:
                              Units;  (ii) the  termination  of this Offering by
                              the Company;  or (iii)  October 15,  1999,  unless
                              extended  by  the   Company.   See   "SUBSCRIPTION
                              PROCEDURE."

        The  preceding  summary is  qualified  in its entirety by, and should be
read in conjunction with, the more detailed  information  appearing elsewhere in
this  Memorandum.  Prospective  investors  will be required to  represent to the
Company that they have read this Memorandum in its entirety prior to the sale of
any Units to the prospective investor.

                                        5

<PAGE>

                                                               McGlen Micro Inc.
--------------------------------------------------------------------------------

                                  RISK FACTORS

        THE SECURITIES  OFFERED  HEREBY ARE  SPECULATIVE IN NATURE AND INVOLVE A
HIGH DEGREE OF RISK.  THEY SHOULD BE PURCHASED ONLY BY PERSONS WHO CAN AFFORD TO
LOSE  THEIR  ENTIRE  INVESTMENT  IN THE  COMPANY.  THEREFORE,  EACH  PROSPECTIVE
INVESTOR SHOULD,  PRIOR TO PURCHASE,  CONSIDER VERY CAREFULLY THE FOLLOWING RISK
FACTORS,  AS  WELL  AS  ALL  OTHER  INFORMATION  SET  FORTH  ELSEWHERE  IN  THIS
MEMORANDUM.

Dependence on the Internet; Risks Associated with Evolving Market

        McGlen's  future  success is  substantially  dependent on the  continued
growth in the use of the Internet. The Internet is relatively new and is rapidly
evolving.  The Company's  business would be adversely affected if Internet usage
does not  continue  to grow.  Internet  usage may be  inhibited  for a number of
reasons, such as:

        o    the Internet  infrastructure may not be able to support the demands
             placed on it or its  performance  and  reliability  may  decline as
             usage grows;

        o    security and  authentication  concerns with respect to transmission
             over the Internet of confidential information,  such as credit card
             numbers and attempts by unauthorized  computer users ("hackers") to
             penetrate online security systems; and

        o    privacy  concerns,  such  as  those  related  to the  placement  by
             websites of certain  information to gather user information,  known
             as "cookies,"  on a user's hard drive without the user's  knowledge
             or consent.

        The Company's market is characterized by rapidly changing  technologies,
evolving  industry  standards,  frequent new service  introductions and changing
customer demands.  To be successful,  the Company must adapt to rapidly evolving
markets by introducing new services to address the customers'  changing demands.
The Company's  business,  results of operations and financial condition could be
materially affected if it incurred  significant costs to adapt, or cannot adapt,
to these changes.  Due to the rapidly changing nature of the Internet  business,
the Company may be subject to other unknown risks, now and in the future.

Potential Liability for Content and Products Sold Over the Internet

        The Company  could be exposed to liability for  third-party  information
that may be accessible through the Company's website.  Such claims might assert,
among other things,  that, by directly or indirectly providing links to websites
operated  by third  parties,  the  Company  could be  liable  for  copyright  or
trademark  infringement or other wrongful  actions by such third parties through
such websites.  It is also possible that if any third-party  content information
provided on the McGlen  websites  contains  errors,  consumers might make claims
against McGlen for losses incurred in reliance on such information.

        The Company may also enter into  agreements  with other  companies under
which any revenue  that results  from the  purchase of services  through  direct
links to or from the Company's  website is shared.  Such arrangements may expose
the Company to additional legal risks and uncertainties, including local, state,
federal and foreign government regulation and potential liabilities to consumers

                                        6

<PAGE>

                                                               McGlen Micro Inc.
--------------------------------------------------------------------------------

of these services,  even if the Company does not directly  provide the services.
There is no  assurance  that  any  indemnification  provided  to  McGlen  in its
agreements with these parties, if available, will be adequate.

        Even if any of the possible  claims referred to above does not result in
liability to McGlen,  the Company could incur  significant cost in investigating
and defending  against such claims.  The  imposition of potential  liability for
information  carried on or  disseminated  through  the  Company's  system  could
require it to implement measures to reduce its exposure to such liability, which
might  require  the   expenditure   of   substantial   resources  or  limit  the
attractiveness of the Company's services to consumers, manufacturers,  retailers
and others.

        The Company may not be able to obtain and maintain  adequate  insurance.
The Company's general liability  insurance may not cover all potential claims to
which it may be exposed and may not be adequate to indemnify  claimants  for all
liability  that may be imposed.  Any imposition of liability that is not covered
by insurance or is in excess of insurance coverage could have a material adverse
effect on the Company's business, results of operations and financial condition.

Risks Associated with Entry into New Business Areas

        McGlen may  choose to expand  operations  by  developing  new  websites,
promoting new or complementary products or sales formats,  expanding the breadth
and depth of products and services  offered or expanding  the  Company's  market
presence through  relationships with third parties.  The Company may also pursue
new acquisitions or investments.  If the Company continues to acquire additional
competitors  or other  companies,  it could face  difficulties  in  assimilating
personnel and  operations.  In addition,  key personnel of the acquired  company
might decide not to work for McGlen. Any new business or website launched by the
Company not favorably  received by consumers could also damage the reputation of
the Company or its brands.  The lack of market acceptance of such efforts or the
inability  to generate  satisfactory  revenues  from such  expanded  services or
products  to offset  their  cost could  have a  material  adverse  effect on the
Company's business, results of operations and financial condition.

Voting Control by the Officers and Directors of the Company's Common Stock

        The  Company's   executive  officers  and  directors   beneficially  own
substantially  all of the  outstanding  shares of Common  Stock and assuming the
Maximum  Offering  is sold,  will  continue  to own over 75% of the  outstanding
shares of Common Stock. The Company's officers and directors  currently are, and
in the  foreseeable  future  will  continue  to be, in a position to control the
Company by being able to nominate and elect the  Company's  Board of  Directors.
The Board of Directors establishes corporate policies and has the sole authority
to  nominate  and  elect the  Company's  officers  to carry out those  policies.
Prospective investors therefore will have limited participation in the Company's
affairs.

Financial Burden on Investors; Dilution

        The Company's present  shareholders  acquired a controlling  interest in
the Company at a nominal cost, which is  substantially  less than that which the
investors in this  Offering will pay for the Shares.  A significant  part of the
financial  risk  of the  Company's  proposed  activities  will be  borne  by the
investors who purchase the Units,  while certain  management,  business partners
and existing  shareholders  stand to realize  benefits  from  significant  stock
ownership. Investors in this Offering will pay substantially more per Share than
certain existing shareholders paid for their shares. Upon the completion of this

                                        7

<PAGE>

                                                               McGlen Micro Inc.
--------------------------------------------------------------------------------

Offering, investors in this Offering will incur a substantial immediate dilution
in the per Share tangible book value of their Shares.

Competitive Market for Technical Personnel and Retention of Key Employees

        The Company's  success depends in part on its ability to attract,  hire,
train and  retain  qualified  managerial,  technical  and  sales  and  marketing
personnel,  particularly  its  co-founders,  Mike Chen and George Lee, its Chief
Marketing  Officer,  Robert Brown,  its Vice President of Business  Development,
Alex Chen and its Chief  Information  Officer,  David  Chou.  The loss of any of
these  individuals  could  have a  material  adverse  effect  on  the  Company's
business,  results of operation  and financial  condition.  The Company does not
have  long-term  employment  agreements  with  many  of its  key  personnel  and
maintains  no key person  life  insurance.  Competition  for such  personnel  is
intense.  In  particular,  there can be no  assurance  that the Company  will be
successful  in attracting  and retaining the technical  personnel it requires to
conduct  and  expand  its  operations  successfully.  The  Company's  results of
operations  could be materially  adversely  affected if the Company is unable to
attract, hire, train and retain qualified personnel.

Limited Operating History

        McGlen was founded in May 1996 and began retailing  computer  components
and  accessories  on the  Internet.  Accordingly,  there is a limited  operating
history  upon which to base an  evaluation  of the Company and its  business and
prospects.  The Company's  business and prospects must be considered in light of
the risks,  expenses and  difficulties  frequently  encountered  by companies in
their  early stage of  development,  particularly  companies  in new and rapidly
evolving  markets such as electronic  commerce.  Such risks for McGlen include a
dependence  on key  vendors  for  merchandise,  an  evolving  and  unpredictable
business model,  management of growth,  the Company's  ability to anticipate and
adapt to a developing  market,  development of equal or superior Internet retail
operations  by  competitors,  and the ability to identify,  attract,  retain and
motivate  qualified  personnel.  To address these risks, the Company must, among
other things, continue to expand its vendor channels and buyer resources, manage
product  obsolescence and pricing risks,  maintain its customer base and attract
significant  numbers  of new  customers,  respond to  competitive  developments,
implement and execute successfully its business strategy and continue to develop
and upgrade its technologies and retailing  services.  There can be no assurance
that the Company will be  successful  in doing what is required to address these
risks. A substantial reduction in merchandise availability would have a material
adverse  effect on the Company's  business,  results of operations and financial
condition.  In  addition,  the  Company  historically  has  had  relatively  low
operating  margins  and plans to continue to  increase  its  operating  expenses
significantly  in order to increase the size of its staff,  enhance its website,
move to larger  facilities,  expand its  marketing  efforts to enhance its brand
image,  increase its  visibility  on other  companies'  high  traffic  websites,
purchase  larger  volumes of  merchandise,  increase  its  software  development
efforts,  and support  its growing  infrastructure.  As a result,  McGlen  could
experience losses in the future. Further, in view of the rapidly evolving nature
of  the  Company's   business,   the  Company  believes  that   period-to-period
comparisons of its financial  results are not necessarily  meaningful and should
not be relied upon as an indication of future performance.

                                        8

<PAGE>

                                                               McGlen Micro Inc.
--------------------------------------------------------------------------------

Financial Uncertainty; Dependence on the Offering

        McGlen does not have significant  operating  capital.  Accordingly,  the
Company is dependent  upon the proceeds of the Offering to grow its  operations,
further expand its infrastructure and personnel and conduct meaningful promotion
and advertising prior to its proposed merger with Adrenalin. Even if the Maximum
Offering is sold,  the Company will be required to and  currently  plans to seek
additional  financing.  There can be no  assurance  that  McGlen will be able to
raise  additional  capital  if  needed  or,  if  such  additional  financing  is
available,  whether such  financing can be secured on  satisfactory  terms or on
terms not dilutive to investors in this Offering.

Fluctuations in Operating Results

        The Company's  operating  results have  fluctuated in the past,  and are
expected  to continue to  fluctuate  in the future,  due to a number of factors,
many of which are outside the Company's  control.  These factors include (i) the
Company's  ability  to  attract  new  customers  at a steady  rate,  manage  its
inventory  mix and the mix of products  offered  meet certain  pricing  targets,
liquidate its inventory in a timely manner,  maintain gross margins and maintain
customer  satisfaction,  (ii) the  availability  and pricing of merchandise from
vendors,   (iii)  product  obsolescence  and  pricing  erosion,   (iv)  consumer
confidence  in  encrypted  transactions  in the  Internet  environment,  (v) the
timing, cost and availability of advertising on other entities'  websites,  (vi)
the  amount  and  timing  of  costs  relating  to  expansion  of  the  Company's
operations,  (vii) the announcement or introduction of new types of merchandise,
service offerings or customer services by the Company or its competitors, (viii)
technical  difficulties with respect to consumer use of the Company's  websites,
(ix) delays in revenue  recognition at the end of a fiscal period as a result of
shipping or logistical problems,  (x) delays in shipments as a result of strikes
or other problems with the Company's  delivery service  providers or the loss of
the  Company's  credit card  processor,  (xi) the level of  merchandise  returns
experienced by the Company,  and (xii) general economic  conditions and economic
conditions  specific to the Internet  and  electronic  commerce.  As a strategic
response to changes in the competitive environment, the Company may from time to
time make certain service,  marketing or supply  decisions or acquisitions  that
could have a  material  adverse  effect on the  Company's  quarterly  results of
operations and financial condition. The Company also expects that in the future,
like other retailers, it may continue to experience seasonality in its business.

Reliance on Merchandise Vendors

        The  Company  is  entirely  dependent  upon  vendors  to  supply it with
merchandise for sale through the Company's  Internet sites. The availability and
pricing of merchandise is  unpredictable.  In 1998, a substantial  percentage of
the Company's gross  merchandise  sales were derived from  merchandise  acquired
from a single  provider,  Ingram  Micro.  McGlen has no  long-term  contracts or
arrangements  with its vendors that guarantee the  availability  of merchandise.
There can be no assurance  that the Company's  current  vendors will continue to
sell  merchandise  to the Company or that the Company  will be able to establish
new vendor  relationships  that ensure merchandise will be available for sale on
the  Company's  websites.  There also exists a  substantial  risk that  McGlen's
vendors  might  attempt to compete with the Company.  The Company also relies on
many of its vendors to process and ship  merchandise  to customers.  The Company
has limited control over the shipping  procedures of its vendors,  and shipments
by these vendors have often been subject to delays.  Although  most  merchandise
sold by the Company carries a warranty  supplied  either by the  manufacturer or
the vendor, and the Company is not obligated to accept merchandise  returns, the
Company in fact has accepted  returns from  customers  for which the Company did
not receive reimbursements from its vendors or manufacturers. If (i) the Company

                                        9

<PAGE>

                                                               McGlen Micro Inc.
--------------------------------------------------------------------------------

is unable to develop and  maintain  satisfactory  relationships  with vendors on
acceptable  commercial  terms,  (ii) the Company is unable to obtain  sufficient
quantities of merchandise, (iii) the quality of service provided by such vendors
falls below a  satisfactory  standard,  or (iv) the  Company's  level of returns
exceeds its  expectations,  the Company's  business,  results of operations  and
financial condition will be materially adversely affected.

Reliance on Other Third Parties

        In addition to its merchandise  vendors, the Company's operation depends
on a number of third parties.  The Company has limited  control over these third
parties and no long-term  relationships  with any of them.  The Company does not
own a gateway (connection) onto the Internet,  but instead relies on an Internet
service provider to connect the Company's websites to the Internet. From time to
time,  the Company  has  experienced  temporary  interruptions  in its  websites
connections  and also its  telecommunications  access.  Continuous  or prolonged
interruptions in the Company's websites connections or in its telecommunications
access would have a material adverse effect on the Company's  business,  results
of  operations  and financial  condition.  The  Company's  operations  depend on
operation  systems,  databases and servers and variety of software developed and
produced by, and licensed from, third parties. The Company has from time to time
discovered  errors and defects in the software  from these third parties and, in
part,  relies on these third  parties to correct  these  errors and defects in a
timely manner.

Risks of a Purchased Inventory Model

        While in most cases McGlen has limited  inventory and price risk because
it acts as a sales agent for vendors that retain title to the  merchandise  sold
by the Company,  McGlen does  purchase  some of its  merchandise  from  vendors,
thereby  assuming the  inventory  and price risks of these  products to be sold.
These risks are especially significant because much of the merchandise currently
sold by the Company (e.g., computer parts, peripherals and consumer electronics)
is characterized by rapid technological change,  obsolescence and price erosion.
With  McGlen's  increasing  reliance on  purchased  inventory,  its success will
depend on its ability to liquidate the inventory  rapidly through its sales, the
ability of its buying staff to purchase  inventory at attractive prices relative
to the  resale  value,  and its  ability  to  manage  customer  returns  and the
shrinkage  resulting  from theft,  loss and  misrecording  of inventory.  If the
Company  is unable to  liquidate  its  purchased  inventory  rapidly,  or if the
Company's buying staff fails to purchase  inventory at attractive  prices, or if
the Company  fails to predict with  accuracy the resale prices for its purchased
merchandise, the Company may be forced to sell its inventory at a discount or at
a loss and the Company's business, results of operations and financial condition
would be materially adversely affected.

Competition

        The electronic  commerce market,  particularly on the Internet,  is new,
rapidly evolving and intensely competitive,  and the Company expects competition
to intensify in the future. The Company currently or potentially competes with a
variety of other companies depending on the type of merchandise and sales format
offered  to  customers.   These   competitors   include   Amazon.com,   Buy.com,
Outpost.com, Shopping.com/Compaq,  Onsale.com and Dell. Most if not all of these
competitors currently sell products below cost in order to acquire market share.
Current and potential  competitors have established or may establish cooperative
relationships  among themselves or directly with vendors and suppliers to obtain
exclusive or semi-exclusive sources of merchandise.  Accordingly, it is possible
that new competitors or alliances  among  competitors and vendors may emerge and
rapidly  acquire  market  share.  In  addition,  manufacturers  might  elect  to
liquidate their products directly. Increased competition is likely to result in

                                       10

<PAGE>

                                                               McGlen Micro Inc.
--------------------------------------------------------------------------------

reduced  operating  margins,  loss  of  market  share  and  a  diminished  brand
franchise,  any one of which could  materially  adversely  affect the  Company's
business,  results of operations and financial condition.  Many of the Company's
current  and  potential   competitors  have  significantly   greater  financial,
technical, marketing and other resources than the Company. As a result, they may
be able to secure  merchandise  from  vendors on more  favorable  terms than the
Company,  and they may be able to respond  more  quickly to changes in  customer
preferences or to devote  greater  resources to the  development,  promotion and
sale of their merchandise than can the Company.

Management of Growth; Limited Senior Management Resources

        The Company has rapidly and  significantly  expanded its  operations and
anticipates  that  significant  expansion of its operations  will continue to be
required in order to address potential market  opportunities.  This rapid growth
has placed,  and is expected to continue to place,  a significant  strain on the
Company's management,  operational and financial resources. McGlen expanded from
13 employees  as of December 31, 1997,  to 34 employees as of December 31, 1998,
and 65 employees as of September 16, 1999.  The Company's new employees  include
certain  key  managerial  and  technical  employees  who have not yet been fully
integrated  into the Company's  management  team, and the Company expects to add
additional  key  personnel  in the  near  future.  Increases  in the  number  of
employees and the volume of merchandise sales have placed significant demands on
the Company's management, which includes only three executive officers. In order
to manage the expected growth of its operations, the Company will be required to
expand existing  operations,  particularly  with respect to customer service and
merchandising, to improve existing and implement new operational,  financial and
inventory  systems,  procedures  and  controls,  including  improvement  of  its
financial and other internal management systems on a timely basis, and to train,
manage and expand its already  growing  employee  base. The Company also will be
required to expand its accounting staff.  Further, the Company's management will
be required to maintain relationships with various merchandise vendors,  freight
companies,  warehouse operators,  other websites and services,  Internet service
providers  and other third  parties and to maintain  control over the  strategic
direction  of the  Company in a rapidly  changing  environment.  There can be no
assurance that the Company's current personnel, systems, procedures and controls
will be adequate to support the Company's  future  operations,  that  management
will be able to identify,  hire,  train,  retain,  motivate and manage  required
personnel  or that  management  will be able to manage and exploit  existing and
potential market opportunities successfully.  If the Company is unable to manage
growth effectively,  the Company's business, results of operations and financial
condition will be materially adversely affected.

Risks Associated with Technological Change; Dependence on the Internet

        The Internet and electronic  commerce  industries are  characterized  by
rapid technological change, changes in user and customer requirements,  frequent
new  service  or  product  introductions  embodying  new  technologies  and  the
emergence  of new  industry  standards  and  practices  that  could  render  the
Company's existing website and proprietary  technology  obsolete.  The Company's
performance   will  depend,   in  part,  on  its  ability  to  license   leading
technologies,  enhance its existing services, develop new proprietary technology
that  addresses  the  increasingly   sophisticated   and  varied  needs  of  its
prospective  customers,  and  respond to  technological  advances  and  emerging
industry  standards  and  practices on a timely and  cost-effective  basis.  The
development of websites and other  proprietary  technology  entails  significant
technical and business risks. There can be no assurance that the Company will be
successful in using new  technologies  effectively  or adapting its websites and
proprietary  technology to customer requirements or emerging industry standards.
If the Company is unable, for technical,  legal,  financial or other reasons, to
adapt in a timely manner in response to changing market conditions or customer

                                       11

<PAGE>

                                                               McGlen Micro Inc.
--------------------------------------------------------------------------------

requirements,  or if the Company's  websites and  proprietary  technology do not
achieve market  acceptance,  the Company's  business,  results of operations and
financial condition would be materially adversely affected.

Government Regulation and Legal Uncertainties

        The  Company  is not  currently  subject  to  direct  regulation  by any
government agency, other than regulations applicable to businesses generally and
laws  or  regulations  directly  applicable  to  access  to or  commerce  on the
Internet.  Due to the  increasing  popularity  and  use of the  Internet,  it is
possible  that a number of laws and  regulations  may be adopted with respect to
the Internet,  covering issues such as user privacy, pricing and characteristics
and quality of products and services. Furthermore, the growth and development of
the market for Internet  commerce may prompt calls for more  stringent  consumer
protection laws that may impose additional burdens on those companies conducting
business over the Internet.  The adoption of any additional  laws or regulations
may decrease the growth of the  Internet,  which,  in turn,  could  decrease the
demand for the Company's Internet sales and increase the Company's cost of doing
business or otherwise have an adverse effect on the Company's business,  results
of operations and financial condition.  Moreover,  the applicability of existing
laws to the  Internet in various  jurisdictions  governing  issues such as sales
tax, libel and personal  privacy is uncertain and may take years to resolve.  In
addition,  as the Company's  service is available  over the Internet in multiple
states and foreign  countries,  and as the Company  sells to numerous  consumers
residing in such states and foreign countries, such jurisdictions may claim that
the Company is required  to qualify to do business as a foreign  corporation  in
each such state and foreign country. Any such new legislation or regulation,  or
the  application of laws or  regulations  from  jurisdictions  whose laws do not
currently apply to the Company's business,  could have a material adverse effect
on the Company's business, results of operations and financial condition.

Risk of System Failure; Single Site

        The  Company's  success is  largely  dependent  upon its  communications
hardware  and  computer  hardware,  substantially  all of which are located at a
leased facility in Tustin,  California.  The Company's systems are vulnerable to
damage from earthquake,  fire, floods, power loss,  telecommunications failures,
break-ins and similar  events.  The Company does not presently have  significant
redundant systems or a formal disaster recovery plan. A substantial interruption
in these systems would have a material adverse effect on the Company's business,
results of operations and financial  condition.  Despite the  implementation  of
network  security  measures by the Company,  its servers are also  vulnerable to
computer viruses, physical or electronic break-ins, deliberate attempts by third
parties to exceed the capacity of the Company's  systems and similar  disruptive
problems.  Computer viruses, break-ins or other problems caused by third parties
could lead to  interruptions,  delays,  loss of data or  cessation in service to
users of the  Company's  services and products.  The  occurrence of any of these
risks could have a material adverse effect on the Company's business, results of
operations and financial condition.

Internet Commerce Security Risks

        A significant  barrier to electronic  commerce and communications is the
secure  transmission of confidential  information over public  networks.  McGlen
relies on encryption and authentication  technology  licensed from third parties
to  provide  the  security  and   authentication   necessary  to  effect  secure
transmission  of  confidential  information.  There  can  be no  assurance  that
advances in computer capabilities,  new discoveries in the field of cryptography
or other events or developments will not result in a compromise or breach of the
algorithms used by the Company to protect customer transaction data. If any such
compromise of the Company's security were to occur, it could have a material

                                       12

<PAGE>

                                                               McGlen Micro Inc.
--------------------------------------------------------------------------------

adverse  effect on the Company's  business,  results of operations and financial
condition.  A party who is able to circumvent  the Company's  security  measures
could  misappropriate  proprietary  information,   credit  card  information  of
customers or cause  interruptions  in the  Company's  operations.  McGlen may be
required to expend  significant  capital and other  resources to protect against
the threat of such  security  breaches or to alleviate  problems  caused by such
breaches. Concerns over the security of Internet transactions and the privacy of
users may also  inhibit  the growth of the  Internet  generally,  and the web in
particular,  especially as a means of conducting commercial transactions. To the
extent that  activities  of the Company or third party  contractors  involve the
storage  and  transmission  of  proprietary  information,  such as  credit  card
numbers,  security  breaches could expose McGlen to a risk of loss or litigation
and possible  liability.  There can be no assurance that the Company's  security
measures will prevent security breaches or that failure to prevent such security
breaches  will not have a material  adverse  effect on the  Company's  business,
results of operations and financial condition.

Risk of Capacity Constraints;  Reliance on Internally Developed Systems;  System
Development Risks

        A key element of the Company's  strategy is to generate a high volume of
traffic on, and use of, its websites. Accordingly, the satisfactory performance,
reliability and availability of the Company's  websites,  transaction-processing
systems and network  infrastructure are critical to the Company's reputation and
its  ability  to attract  and retain  customers,  as well as  maintain  adequate
customer service levels. The Company's revenues depend on the number of visitors
who shop on its  websites  and the  volume of orders it  fulfills.  Any  systems
interruptions  that result in the  unavailability  of the Company's  websites or
reduced order fulfillment  process would reduce the volume of goods sold and the
attractiveness of the Company's product and service  offerings.  The Company may
experience  periodic systems  interruptions  from time to time.  Currently,  the
Company is experiencing a significant  increase in customer telephone  inquiries
regarding pending orders resulting in an overload of its telephone  system.  The
telephone system requires major  enhancements  immediately to handle the current
telephone  volume.  Any  substantial  increase  in the  volume of traffic on the
Company's  websites or the number of orders placed by customers will require the
Company to expand and  upgrade  further its  technology,  transaction-processing
systems and network  infrastructure.  There can be no assurance that the Company
will be able to accurately  project the rate or timing of increases,  if any, in
the  use  of  its  websites  or  timely  expand  and  upgrade  its  systems  and
infrastructure to accommodate such increases.

        The  Company  uses a  combination  of  industry  supplied  software  and
internally  developed software and systems for its websites,  search engine, and
substantially all aspects of transaction processing, including order management,
cash and credit card processing,  shipping and accounting and financial systems.
Any  substantial  disruptions  or  delays  in any of its  systems  would  have a
material  adverse  effect  in  the  Company's  business,  prospects,   financial
condition and results of operations.

Dependence of Continued Growth of Online Commerce

        The Company's  future revenues and any future profits are  substantially
dependent  upon the  widespread  acceptance  and use of the  Internet  and other
online services as an effective medium of commerce by consumers. Rapid growth in
the use of and interest in the web, the Internet and other online  services is a
recent  phenomenon,  and there can be no assurance that  acceptance and use will
continue to develop or that a  sufficiently  broad base of consumers will adopt,
and  continue to use,  the  Internet  and other  online  services as a medium of
commerce.  Demand and market  acceptance  for recently  introduced  products and
services over the Internet are subject to a high level of uncertainty. The

                                       13

<PAGE>

                                                               McGlen Micro Inc.
--------------------------------------------------------------------------------

Company  relies,  and will continue to rely, on consumers who have  historically
used traditional means of commerce to purchase  merchandise.  For the Company to
be successful,  these consumers must accept and utilize novel ways of conducting
business and exchanging information.  In addition, the Internet and other online
services may not be accepted as a viable commercial  marketplace for a number of
reasons,  including potentially  inadequate development of the necessary network
infrastructure or delayed  development of enabling  technologies and performance
improvements. To the extent that the Internet and other online services continue
to experience  significant growth in the number of users, their frequency of use
or an increase in their bandwidth  requirements,  there can be no assurance that
the  infrastructure  for the Internet and other online  services will be able to
support the demands  placed on them.  In addition,  the Internet or other online
services could lose their viability due to delays in the development or adoption
of new standards and protocols  required to handle  increased levels of Internet
or other online service activity, or due to increased  governmental  regulation.
Changes  in or  insufficient  availability  of  telecommunications  services  to
support  the  Internet  or other  online  services  could also  result in slower
response  times and  adversely  affect  usage of the  Internet  and other online
services  generally  and the Company in  particular.  If use of the Internet and
other  online  services  does not  continue  to grow or grows more  slowly  than
expected,  or if the  infrastructure  for the Internet and other online services
does not effectively support growth that may occur, or if the Internet and other
online  services do not become a viable  commercial  marketplace,  the Company's
business,  prospects,  financial  condition,  and results of operations would be
materially adversely affected.

Year 2000

        The  Company  will be  interacting  with  certain  computer  programs in
connection  with credit card  transactions  and programs  used by the  Company's
vendors and suppliers. These programs may refer to annual dates only by the last
two digits, e.g., "99" for "1999." Problems are anticipated to arise for many of
these programs in the year 2000 ("Year 2000 Problems") when "00" is mistaken for
"1900." The Company has taken this  problem into account with respect to its own
internal programs and believes that its own internal software is not susceptible
to Year 2000 Problems.  The Company will not,  however,  be certain that its own
systems are free from Year 2000  Problems  until after the  Millennium,  when it
will be too  late to  correct  undiscovered  problems  before  they  potentially
adversely  effect the  Company's  operations.  The Company has not made a formal
assessment  of  programs  used by  service  providers  or other  third  parties,
including the financial institutions  processing credit card transactions,  with
which the Company may have to interact,  nor the Company's  vulnerability  which
may  result  from any such  party's  failure  to  remediate  their own Year 2000
problems.  There can be no  guarantee  that the  systems of the Company or other
companies on which the Company relies will be converted timely and will not have
an  adverse  effect  on  the  Company's  systems  and  the  Company's  business,
prospects, financial condition and results of operations.

Availability of Merchandise; Vendor Credit for the Company

        Although the Company's  merchandising  division maintains  relationships
with vendors which it believes  will offer  competitive  sources of supply,  and
believes that other sources are  available for most of the  merchandise  it will
sell or may sell in the future, there can be no assurance that suppliers will be
able to  obtain  the  quantity  of brand or  quality  of items  that  management
believes  are  optimum.  The  unavailability  of  certain  product  lines  could
adversely impact the Company's operating results.  Most of the Company's vendors
are not  prepared  to  advance  normal  levels  of credit  to the  Company.  The
Company's   current  sales  volumes  are  also  limited  by  the  gross  account
limitations placed upon credit card sales by the Company's  Visa/Mastercard  and
other credit card service  providers.  An  unwillingness  to extend credit along
with a substantial increase in sales volume will cause the Company to exceed its

                                       14

<PAGE>

                                                               McGlen Micro Inc.
--------------------------------------------------------------------------------

current credit limit,  thus requiring  additional  amounts of capital to finance
the Company's operations, and reduce returns, if any, on invested capital.

Sales and Other Taxes

        The Company does not currently collect sales or other similar taxes with
respect to shipments of goods to  consumers  into states other than  California.
One or more  states  may seek to impose  sales  tax  collection  obligations  on
out-of-state  companies such as the Company, which engage in online commerce. In
addition, any new operation in states outside California could subject shipments
into such states to state sales taxes under current or future laws. A successful
assertion by one or more states or any foreign  country that the Company  should
collect  sales or other taxes on the sale of  merchandise  could have a material
adverse effect on the Company's  business,  prospects,  financial  condition and
results of operations.

Restrictions on Transfer

        Neither  the Units nor the Shares  contained  in the Units may be resold
unless such sale is registered  under the Act or qualifies for an exemption from
registration  under the Act and all applicable  state securities laws. The Units
and the Shares  should be  considered a suitable  investment  only for investors
whose  financial  position  is such that they will be able to hold the Units and
the  Shares for an  indefinite  period.  Some  state laws may impose  additional
restrictions on transfer of the Units or the Shares.

Best Efforts Offering

        This  Offering is being made on a "best  efforts"  basis.  No commitment
exists to purchase all or any part of the Units being offered  hereby.  There is
no guarantee that the Company will be able to sell any of the Units.

Limitation of Liability

        The Company's  Articles of Incorporation,  as amended,  provide that the
Company's  directors shall not be personally  liable for monetary damages to the
Company or its shareholders for a breach of fiduciary duty as directors, subject
to limited exceptions. Although such limitation of liability does not affect the
availability of equitable remedies such as injunctive relief or rescission,  the
presence of these provisions in the Articles of Incorporation, as amended, could
prevent the recovery of monetary damages against the Company's directors.

No Dividends

        The  Company  has never paid any cash or other  dividends  on its common
stock.  Payment of dividends is within the  discretion of the Board of Directors
and will depend upon the Company's earnings,  capital requirements and financial
condition,  and other factors deemed relevant by the Board.  For the foreseeable
future,  the Board of Directors  intends to retain future  earnings,  if any, to
finance  its  business  operations  and  does  not  anticipate  paying  any cash
dividends with respect to the Common Stock.

                                       15

<PAGE>

                                                               McGlen Micro Inc.
--------------------------------------------------------------------------------

Arbitrary Price

        The price for the Units and the Shares has been  determined  arbitrarily
by the Company.  The Offering  price should not be regarded as an  indication of
any future  market price of the  Company's  capital stock and has no relation to
the value of the Company or the Common Stock.

Projections and Forward-Looking Statements

        This  Memorandum  contains  statements  regarding  matters  that are not
historical facts and constitute forward-looking statements within the meaning of
Section 27A of the Act and Section 21E of the  Securities  Exchange Act of 1934.
These  statements  often  refer  to the  Company's  future  plans,  projections,
objectives,  expectations  and  intentions  and the  assumptions  underlying  or
relating to these  statements.  These  statements  are  generally  identified by
reference  to  such  words  as  "expects,"   "anticipates,"   "hopes,"  "plans,"
"intends,"  "believes,"  "estimates" and similar  expressions  evidencing future
intentions.  Because the outcome of the events described in such forward-looking
statements  is  subject  to  risks  and  uncertainties  and  in  the  nature  of
projections or predictions of future events which may not occur,  actual results
may differ materially from those expressed in or implied by such forward-looking
statements.  Although the Company  believes that the  expectations  reflected in
such forward-looking  statements are based upon reasonable  assumptions,  it can
give no assurances that its expectations  will be achieved.  The level of future
revenues of the  Company,  and its  profitability,  if any,  are  impossible  to
accurately predict due to uncertainty as to possible changes in economic, market
and other circumstances.  Certain of the factors that could cause actual results
to differ from the Company's  expectations  are set forth in these Risk Factors.
Prospective  investors are urged to consent with their own advisors with respect
to any revenue, financial, business and other projections contained herein.

New Software and Server

        The Company has recently  purchased and adopted a new server and related
software  for  accounting,  inventory  and  purchasing  control.  A few  of  the
Company's  employees  is  experienced  in the  operation  of the new  server and
software. Since the Company is dependent upon its server to support every aspect
of its business, if the Company is unable to quickly adapt to the new system, it
could have a material adverse effect upon the Company's results of operations.

Risks Related to the Adrenalin Merger

        Uncertainty  of Completion  of Merger.  The Company has priced the Units
and the Shares in this  Offering  based upon the  expectation  that the proposed
merger between the Company and Adrenalin Interactive, Inc. (Nasdaq Symbol: ADRN)
will be completed (the "Merger"). The consummation of the Merger is subject to a
number of conditions including, without limitation,  approval by Nasdaq, the SEC
approval of a Merger proxy and approval by the shareholders of Adrenalin and the
completion of this Offering. If for any reason the Merger is not completed,  the
Company will be required to pay back certain loans from  Adrenalin (as described
herein "Adrenalin").  If the Merger is not completed,  the Company will not have
any  liquidity  in its stock and may not have any other  means to  leverage  its
revenues  to obtain  multiples  achieved  by  publicly  traded  Companies.  Such
illiquidity  could have a material adverse effect upon the Company's  ability to
raise additional  capital.  In addition,  if the Merger is not consummated,  the
attention and effort  devoted to the  integration of the two companies will have
significantly  diverted management's  attention from other significant operating
issues,  and could have a material  adverse  effect on the Company's  results of
operations. See "RECENT TRANSACTIONS."

                                       16

<PAGE>

                                                               McGlen Micro Inc.
--------------------------------------------------------------------------------

        The Market Price of Adrenalin  Could  Decline as a Result of the Merger.
Even if the Merger is consummated,  the market price of Adrenalin's common stock
could decline as a result of the Merger if: (i) the integration of Adrenalin and
the Company is  unsuccessful;  (ii) the  combined  company  does not achieve the
perceived  benefits  of the Merger as rapidly  or to the extent  anticipated  by
financial  analysts;  or (iii) the  Merger's  financial  effect on the  combined
company is not consistent with the expectation of financial analysts.

        Inability to Manage Public  Company.  The  Management of the Company has
little experience in operating a public company or to the reporting and investor
and market relation  responsibilities  or market sensitivity  attendant thereto.
There is no assurance  that the  Company's  executive  officers  will be able to
manage  the  operations  of  a  public  company  and  the  financially  troubled
subsidiary of Adrenalin, Western Technologies. The failure to effectively manage
the combined  entity  could have a material  adverse  effect upon the  Company's
results of operations.

        Financial  Impact of Merger.  Each of Adrenalin  and the Company has and
will continue to expend substantial sums on legal and accounting fee, investment
advisors,  and  consulting  services and each company has dedicated  substantial
management  resources  to the  Merger.  Adrenalin  is  not  profitable  and  has
substantial  debt and trade  payables.  The Company  will  inherit each of these
problems and liabilities.  If the Company fails to generate substantial revenues
and earnings, the cost of the Merger and the liabilities of Adrenalin could have
a material adverse effect on the Company's results of operations.

        FOR  ALL OF THE  REASONS  STATED  IN  THESE  RISK  FACTORS  AND  OTHERS,
INCLUDING  THOSE SET FORTH  HEREIN,  THESE  SECURITIES  INVOLVE A HIGH DEGREE OF
RISK. ANY PERSON  CONSIDERING  AN INVESTMENT IN THE  SECURITIES  OFFERED IN THIS
MEMORANDUM  SHOULD  BE  AWARE OF  THESE  AND  OTHER  FACTORS  SET  FORTH IN THIS
MEMORANDUM.  THESE SECURITIES SHOULD ONLY BE PURCHASED BY PERSONS WHO CAN AFFORD
A TOTAL LOSS OF THEIR INVESTMENT IN THE COMPANY AND HAVE NO IMMEDIATE NEED FOR A
RETURN OF OR ON THEIR INVESTMENT.

                                       17

<PAGE>

                                                               McGlen Micro Inc.
--------------------------------------------------------------------------------

                                  THE BUSINESS

The Company

        McGlen Micro Inc. is a leading  Internet  operating  company  focused on
creating  branded  ecommerce  marketplaces/  storefronts  targeting  business to
business and business to consumer markets.  Formed in May 1996, McGlen has grown
into a leading  Internet  provider of desktop,  and mobile  computing  products,
including hardware,  software,  peripherals,  accessories and services targeting
technology  oriented consumers and business  professionals in small,  medium and
large sized businesses.

        McGlen currently  operates two companies with two distinct  marketplace/
storefronts,  AccessMicro.com  and  McGlen.com,  each  providing a wide array of
computing  products to business  professionals and technology  enabled consumers
respectively.  Utilizing  McGlen's two unique  companies,  and by leveraging the
Company's  distribution  network of over 85,000 stock  keeping  units  ("SKUs"),
McGlen enables consumers to individually research,  evaluate, compare, integrate
and purchase  computing  products and services based on their individual  needs,
desires and motivations. McGlen's dynamically responsive online content and vast
choice of products  creates a one-stop  shopping  capability for  consumers,  24
hours a day, seven days a week.

        The Company's online shopping experience is based on McGlen's unique and
aggressive  selling  strategy  which  focuses on creating an online  experience.
McGlen provides multiple shopping  capabilities based on individual  preferences
and  features,  an easy  to  navigate  interface,  extensive  product  research,
integration and information tools and powerful search capabilities.

        In  order  to  build  and  enhance  McGlen's  corporate  brand  and  the
individual  brand  positions  for  AccessMicro.com  and  McGlen.com,  McGlen  is
currently  planning  multiple  marketing  programs,  advertisements  and co-ops.
McGlen  is  currently   entering  into  business   development,   marketing  and
promotional  alliances with content,  website and media properties.  McGlen will
also be re-branding McGlen.com in October 1999, as Techsumer.com.  Techsumer.com
will replace  McGlen.com and will continue to be positioned as the Online Market
for Technology Consumers.  AccessMicro.com will continue to be positioned as the
Online Market for Business Professionals.

Revenue & Growth

        The  Company  has  grown  rapidly  since its  inception  in 1996 when it
focused  primarily on memory products.  Additional growth has been as the result
the acquisition of AccessMicro.com  storefront.  McGlen is currently  finalizing
the reverse  acquisition  of Adrenaline  Interactive  (Nasdaq:  ADRN).  McGlen's
combined  (accessmicro.com  and  McGlen.com) net sales revenues are projected to
reach $35.0 million for the year ending 1999, up nearly 100% from a revenue base
of $16 million for the year ended December 31, 1998.

        McGlen's  quarterly net sales revenue has increased  consecutively  from
Q3/98 to Q3/99  from  $3.9  million,  to $4.6  million,  $6.1  million  and $8.1
million, respectively. McGlen is currently acquiring new consumers at an average
rate of nearly 15,000 per month up from 8,000 in 1998,  McGlen has current total
consumer list of over  170,000.  McGlen has an average  repeat  consumer base of
nearly 28% for  second  time  buyers  which has  increased  from 19% in the year
ending 1998. For the year ending 2000 McGlen believes that the repeat purchase

                                       18

<PAGE>

                                                               McGlen Micro Inc.
--------------------------------------------------------------------------------

rate  will  increase  to  an  estimated  40%.  McGlen  companies  are  currently
experiencing an average  transaction  size of  approximately  $220 per order for
AccessMicro.com and $237 for McGlen.com.

McGlen's Market

        According to Jupiter Communications, a prominent on-line market research
firm,  the  marketplace  for online  purchases  by consumer in North  America is
expected  to grow  from  nearly  $50.8  billion  in 1998 to  approximately  $1.4
trillion by 2003. Of this total  available  market,  Jupiter  estimates that the
business to consumer portion will grow from $7.8 billion in 1999 to an estimated
$108  billion in 2003.  Jupiter  also  estimates  that the  business to business
portion of this market will grow from $43 billion in 1999 to an  estimated  $1.3
trillion  market  by 2003.  In the  combined  total  available  market,  Jupiter
estimates that by 2003 the largest online revenue  opportunity  will be the sale
of  computer  products,   communications   products  and  consumer  electronics,
estimated to be $14.5 billion in the North American market.

        In order to capitalize on the additional  market growth outside McGlen's
current  market,  McGlen will move to expand the Company's focus in the areas of
communications products and consumer electronics based entertainment products.

Business Strategy

        McGlen recognizes the unique opportunity created by the Internet medium.
In the Company's  effort to become the leading  provider of technology  products
for business  professional and technology  consumers,  McGlen is focusing on the
following business strategy elements:

        Create a Leading eCommerce Business Model,  eCommerce Engine and Website
        Experience.

        McGlen has  developed  a  proprietary  business  model which it believes
results in a profitable  return based on multiple  revenue points,  ranging from
product  sales  through  customized  up-selling  and cross selling of additional
product   and   services,   to   the   primary   purchase    consideration   and
advertising/merchandising subsidies. McGlen believes that in order to succeed in
the online retailing  marketplace,  the Company must focus on one basic concept:
the website based on the  utilization of one part content and one part commerce.
McGlen  believes  this  concept  that this is key to  creating  a robust  online
shopping experience that is more convenient, more responsive, more personal, and
more intuitive than provided in traditional  brick and mortar  settings.  McGlen
utilizes  a number  of  Internet  technologies  combined  with  its  proprietary
database  which it  believes  provides a unique  purchasing  experience  for the
Company's  consumers.  McGlen's  utilization  of content  creates an  attractive
median for vendors and  manufacturers to effectively  merchandise their products
for sale,  while providing McGlen with a revenue stream from  merchandising  and
promotional fees. Further, McGlen hopes that the high entertainment value of the
sites  create a reason for  consumers  to return to the sites to see  additional
offerings available.  McGlen will continue to focus on re-marketing to consumers
once they have  purchased  by  creating  custom,  personalized  pages that greet
consumers  and  immediately  offer  special  configurations  based on their past
purchase and shopping behaviors.

        Diversify & Integrate the Product Portfolio

        By   diversifying   the  product   portfolio  to  focus  on   computing,
communications  and entertainment  products,  McGlen's  marketplaces are able to
offer  consumers a greater  variety of products  and prices in  categories  that
consumer and business professionals commonly own. Each marketplace will appeal

                                       19

<PAGE>

                                                               McGlen Micro Inc.
--------------------------------------------------------------------------------

to a certain consumer segment, providing consumers an in depth selection of name
brand, unbranded, private label, surplus and refurbished products. The extensive
product  line of each  marketplace/storefront  serves  to  differentiate  McGlen
companies from other e-tailers  offering more than the "plain vanilla" selection
most competitors  offer. In addition,  since the majority of brand name products
come from major  distributors,  McGlen's  portfolio of unbranded and refurbished
goods decreases its dependence on those suppliers and creates an opportunity for
higher gross margins. Currently, unbranded and refurbished items account for 23%
of net sales at average gross margins of 20%.

        Further  by  focusing  on  products  that  have a level of  interconnect
capability within one product silo, or category, such as the computing category,
where a piece of software  can be sold to a desktop  computing  product,  McGlen
marketplaces  can  provide  additional  up-sell  attachments  of products to the
consumers  primary sale.  This  interconnectivity  also exists  between  product
silos.  This  allows  products  such as  communication  products  and  computing
products  to be  integrated  by  the  user  online  using  the  website  in  the
Techsumer.com marketplace or the AccessMicro.com marketplaces respectively.

        Create World Class Brand

        McGlen believes that both  Techsumer.com  and  AccessMicro.com  are well
positioned  to  become   leading  brand  names  in  Internet   commerce  due  to
management's  experience in marketing,  sales,  distribution and development and
application of proprietary information  technology.  McGlen operates in a market
in which its brand names are critical to attracting  high quality  vendors and a
high level of consumer  traffic.  Accordingly,  McGlen's strategy is to promote,
advertise and increase its  marketplace/storefront  visibility through a variety
of marketing and promotional techniques.

        Develop Strategic Alliances

        Since many of McGlen's  online  competitors are supplied by the same few
distributors such as Ingram Micro and Tech Data, McGlen believes that developing
strategic  alliances with other distributors will prove to be an operational and
competitive  advantage.  In  pursuit of this  strategy,  McGlen  entered  into a
strategic  alliance with Synnex  Information  Technologies  Inc.  ("Synnex"),  a
division of the largest  distributor of computer related products in Taiwan. The
benefits of this alliance include higher margins,  better terms of sale, and the
leveraging of the Synnex  relationship to negotiate  direct contracts with other
select manufacturers.

        Increase Direct Supply from Device Manufacturers

        Acquiring   products  directly  from   manufacturers  is  an  additional
component  to  McGlen's  model for  profitability  and growth.  The  benefits of
augmenting the distributor  relationship with direct manufacturer  relationships
are improved gross margins and better terms of sale. Direct  relationships  with
the manufacturer also serves as a competitive  advantage given that the universe
of component  manufacturers is large and fragmented.  In choosing  manufacturers
with whom to do business,  McGlen selects only those with a proven reputation of
offering high quality products.  McGlen currently  acquires some of its battery,
memory, media, and printer accessory products directly from manufacturers.

        Leverage Low Cost Infrastructure

        McGlen does not incur normal expenses necessary to support a traditional
retail operation, which requires inventory, warehouse facilities, retail store

                                       20

<PAGE>

                                                               McGlen Micro Inc.
--------------------------------------------------------------------------------

space and attendant personnel. McGlen establishes its vendor relationships where
it acts as a principal and arranges the order fulfillment, payment verification,
shipping  functions and consumer support,  which enables it to take advantage of
the savings from eliminating those traditional retail expenses.

        Cross Merchandising and One to One Marketing

        McGlen will utilize data mining techniques to analyze storefront traffic
and purchase history.  This should allow McGlen to develop products and services
based upon consumer  needs.  By promoting  purchases from repeat buyers,  McGlen
simultaneously  develops  brand  loyalty,  one of the  most  powerful  and  cost
effective  marketing  assets.  In  addition,   average  order  sizes  have  been
historically  higher  for  repeat  purchases  than  for  first  time  purchases.
Currently,  over 35% of McGlen's net sales are from repeat  buyers.  To increase
this  number,  McGlen  will  increase  the  frequency  and  appeal of its direct
marketing efforts to existing consumers.  Furthermore,  McGlen will increase the
interactivity  of its website to provide a community-like  experience,  which it
believes will encourage consumers to return repeatedly.

        Develop Broad Appeal Merchandising

        McGlen's  merchandising strategy is designed to appeal to all classes of
consumers. McGlen intends to become a one-stop, high technology shopping service
by virtue of its broad  merchandise  mix. McGlen expects to provide the Internet
shopper with  merchandise  selection and pricing  unmatched by any other current
category leader.

        Ensure High Consumer Satisfaction

        McGlen  believes  buyers are initially  attracted by bargain  prices and
quality   merchandise  in  a  friendly  and  community   enhanced   environment.
Accordingly,  McGlen intends to continue  offering its consumers a wide array of
opportunities  to buy  desired  merchandise  at low  prices  through a  visually
stimulating  and user friendly  interface which is rich in both product SKUs and
product  description  content.  Not all  products  are purely sold at the lowest
price  equation.  McGlen will also focus on up-selling or  cross-selling  better
value products and  better-featured  products utilizing McGlen's unique shopping
experiences  through each  marketplace.  In addition to online  order  tracking,
McGlen provides  consumers  online sales  counseling  through an innovative chat
mechanism,  as well as pre and post  sales  support  utilizing  both  e-mail and
telephone support.

Marketing Strategy

        McGlen's primary marketing objectives are to:

        o    Increase  viewer  traffic to McGlen  company  marketplace/sites  by
             promoting the Techsumer.com and AccessMicro.com brand names;
        o    Promote  repeat   purchases   through  strong   consumer   loyalty,
             satisfaction and experience,  and
        o    Increase   up-sell  and   cross-sell   product   attach  rates  for
             incremental revenue opportunities.

        McGlen  intends to build  strong  consumer  loyalty  through  the use of
consumer  preference and behavioral  data obtained as a result of monitoring its
consumers'  activities  online.  In contrast  to  traditional  direct  marketing
efforts,  McGlen's personalized notification services send consumers information
on updated prices,  new product  availability and new service  enhancements.  By
offering consumers a compelling and personalized value proposition, McGlen seeks

                                       21

<PAGE>

                                                               McGlen Micro Inc.
--------------------------------------------------------------------------------

to increase the number of visitors who make a purchase,  thus encouraging repeat
visits and  purchases.  Loyal,  satisfied  consumers also generate word of mouth
advertising  and are  able to reach  thousands  of other  users  through  online
methods.

        McGlen's advertising philosophy is based on measurable effectiveness. As
a  traditionally  profitable  company,  McGlen  believes  that growth of revenue
through marketing should not come at the expense of the bottom line.  Therefore,
to increase consumer  awareness and the consumer base, McGlen plans to focus its
marketing approach to one that encompasses multiple elements:

        Build a virtual community

        McGlen believes that by building a virtual community on its website,  it
can attract  more  consumers  and maintain  higher  levels of loyalty from these
consumers.  McGlen intends to create an interactive,  community like feel to the
online shopping experience.  For example,  consumers/members will be able to set
up profiles,  provide product feedback,  play interactive online games with each
other,  and communicate in real-time chat rooms.  The virtual  community  "feel"
will create an online shopping experience that attracts and retains consumers.

        WebBased Advertising

        McGlen will advertise online with other computer related sites and offer
product  promotions  through  these  sites.  Each  advertising  project  will be
evaluated with respect to cost, exclusivity, and exposure based on click through
ratios and conversion ratios.

        Alliances with Major Websites

        McGlen  believes  that  although  niche based  advertising  will attract
desired  consumers  who are more likely to purchase,  the growth of the Internet
population will include general  populations  that have more diverse  interests.
The intent of  advertising  and  alliances  with major portals is to target this
forthcoming general population,  who can help build brand recognition for McGlen
through informal channels.

        Linking programs

        According to Word-Of-Net,  an online service that measures the number of
links to a  particular  site,  McGlen is reported to have  approximately  15,500
links from other sites on the web as of September  1999.  These  links,  most of
which are free to McGlen,  allow potential consumers to simply click on the link
and become connected to McGlen's site from search engines, manufacturers' sites,
general  interest sites,  and community  sites.  McGlen intends to seek out link
affiliates as a cost-effective means of advertising.

        Direct marketing to current consumers

        McGlen  currently  sends  promotional   offers  via  E-mail  to  current
consumers.  With the enhancement of the McGlen websites to accommodate  consumer
profiles,  McGlen  will  include  one to one  marketing  efforts to the  overall
program.

                                       22

<PAGE>

                                                               McGlen Micro Inc.
--------------------------------------------------------------------------------

Competitive Overview

        In the market for computer related  products,  McGlen faces  competition
from a spectrum  of  category  competitors.  A consumer  who wishes to  purchase
high-tech products has the following options:

================================================================================
CATEGORY                                     SAMPLE COMPETITORS
--------------------------------------------------------------------------------
Traditional "brick and mortar"               CompUSA and MicroCenter
retailers
--------------------------------------------------------------------------------
Mail-order cataloguers                       CDW, MicroWarehouse and Insight
--------------------------------------------------------------------------------
Online retailers                             Buy.com, Outpost.com, NECX and
                                             Onsale.com/ Egghead.com
--------------------------------------------------------------------------------
Manufacturers who sell directly              Dell and Gateway
online
--------------------------------------------------------------------------------
Online service providers                     AOL and the Microsoft Network (MSN)
================================================================================

        McGlen believes that  traditional  retailers and mail-order  cataloguers
cannot  effectively  compete with the convenience,  affordability  and selection
offered  by an online  superstore  like  McGlen.com.  With the  number of online
purchasers  growing at a compound annual rate of roughly 40%,  offline sales are
sure to decrease as a percentage of the total market.

        McGlen  encounters  the  tightest  competition  from the flurry of other
online sites that offer computer products over the Internet,  including Buy.com,
Outpost.com, Onsale.com and NECX.

        Competition

        The  online  commerce  market is new,  rapidly  evolving  and  intensely
competitive.  Current and new  competitors  can launch new sites at a relatively
low cost.  In  addition,  the  computer  products  retail  industry is intensely
competitive.  McGlen  currently or potentially  competes with a variety of other
companies.  These competitors include (i) various traditional computer retailers
including CompUSA and MicroCenter,  (ii) various mail-order  retailers including
CDW,  MicroWarehouse,  Insight,  PC  Connection  and Creative  Computers,  (iii)
various Internet-focused computer retailers including Egghead.com,  software.net
Corporation and NECX Direct, (iv) various  manufacturers that sell directly over
the Internet including Dell, Gateway,  Apple and many software companies,  (v) a
number of online service  providers  including  America Online and the Microsoft
Network  that offer  computer  products  directly or in  partnership  with other
retailers, (vi) some non-computer retailers such as Wal-Mart that sell a limited
selection  of computer  products  in their  stores and (vii)  computer  products
distributors which may develop direct channels to the consumer market. Increased
competition  from these and other  sources  could  require  McGlen to respond to
competitive pressures by establishing  pricing,  marketing and other programs or
seeking out additional  strategic alliances or acquisitions,  any of which could
have a material adverse effect on the business,  prospects,  financial condition
and  results  of  operations  of  McGlen.  McGlen  believes  that the  principal
competitive  factors  in its  market are brand  recognition,  selection,  price,
variety  of  value-added  services,  ease of  use,  site  content,  fulfillment,
reliability,  quality of search tools, customer service and technical expertise.
Many of  McGlen's  current  and  potential  competitors  have  longer  operating
histories, larger customer bases, greater brand recognition, and significantly

                                       23

<PAGE>

                                                               McGlen Micro Inc.
--------------------------------------------------------------------------------

greater  financial,  marketing  and other  resources  than McGlen.  In addition,
online  retailers  may be acquired by,  receive  investments  from or enter into
other commercial  relationships with larger,  well-established and well-financed
companies as use of the Internet and other online services increases.  McGlen is
aware that certain of its competitors  have and may continue to adopt aggressive
pricing  or  inventory  availability  policies  and  devote  substantially  more
resources to website and systems development than McGlen.  Increased competition
may result in reduced operating  margins,  loss of market share and a diminished
brand  franchise,  any of which would have a material  adverse effect on McGlen.
Moreover,  companies that control access to transactions  through network access
or  Web  browsers  currently  promote,  and  will  likely  continue  to  promote
competitors  of McGlen.  There can be no  assurance  that McGlen will be able to
respond   effectively  to  increasing   competitive   pressures  or  to  compete
successfully with current and future competitors.

        "Pure-Play" Online Retailers

        Out of the  "pure-play"  e-commerce  companies,  the early  market share
leaders are Beyond.com,  Buy.com,  Outpost.com, NECX and Onsale. These companies
often sell their  products at near wholesale  prices,  and while they do offer a
competitive  selection of items,  they (with the  exception  of NECX)  typically
purchase their products from the same group of major distributors such as Ingram
Micro and Tech Data.  Thus,  they are  subject to a risky  dependence  on common
suppliers.  Furthermore,  these online  superstores  rely heavily on advertising
revenue to supplement their less profitable trade  operations,  and none of them
have demonstrated positive profits in any period in their financial history.

        Recent New Entrants

        The addition of direct  manufacturers  and web content  providers to the
online superstore scene adds even more competition to an already crowded market.
Dell  Computer,  with the help of IBM, has launched  Gigabuys.com,  a superstore
that  will  offer  roughly  30,000  SKUs.  Gateway,  with the help of NECX,  has
developed SpotShop.com, an online outlet that will offer Gateway and third-party
offerings. Other new entrants include Compaq and Microsoft.

        The threat of direct online selling from the major computer distributors
such as Ingram  Micro  and Tech Data also  presents  a  challenge.  While  these
distributors are currently operating only in the indirect channel, the threat of
eroding margins and increased  competition  could force them to enter the direct
channel.  This would create an opportunity for online retailers that are able to
forge direct relationships with manufacturers, eliminating the distributor.

        Competitive Positioning

        McGlen  realizes  the  challenges  faced  by  the  dynamic   competitive
landscape and believes that it can establish a significant portion of the online
retailing  market by  following  its core  strategy  of  operating  a network of
high-margin,  niche market specialty stores. Unlike other "pure-play" e-commerce
companies, McGlen will offer online product expertise and assistance through its
segmented  specialty  stores  and  virtual  community   experience,   ultimately
providing the customer a higher level of service,  a greater selection and added
convenience. On the operational front, McGlen will seek to continue to establish
more lucrative  contracts and alliances  with  manufacturers  and  distributors.
Additionally, McGlen has the advantage of having a profitable operating history,
unlike most of the large online  retailers  who have yet to turn a profit in any
given period.

                                       24

<PAGE>

                                                               McGlen Micro Inc.
--------------------------------------------------------------------------------

        In  response  to  the  threat  posed  by  the  large  manufacturers  and
distributors  who are eager to establish a superstore  presence  online,  McGlen
intends  to  continue  to offer a broad  selection  of  higher-margin  unbranded
products  to  supplement  its  brand-name  items  with  the aim that  this  will
differentiate  its  product  portfolio  from the brand  name  manufacturers  and
distributors. Furthermore, McGlen intends to continue to expand on the number of
direct relationships with other manufacturers and distributors (e.g. Synnex, the
U.S. subsidiary of one of the largest distributor in Taiwan).

Offices

        McGlen  operates  McGlen.com  and  AccessMicro.com  from  its  principal
executive offices, located at 3002 Dow Avenue, Suite 212, Tustin, CA 92780, Tel:
(949)  851-8078.  These offices  consist of  approximately  4,058 square feet of
office.  McGlen has four years remaining on a five year lease.  The monthly rent
is $3,490. McGlen also leases approximately 2,000 square feet of office space in
Irvine, California, from which McGlen operates AMT Component, Inc. under a three
year  lease  which  expires  in July 13,  2001.  McGlen  pays  $2,200 per month.
McGlen's current  facilities are inadequate for its current size. McGlen intends
to use  part of the  proceeds  to move to a  larger  facility.  The  Company  is
presently  searching for a facility of  approximately  25,000  square feet.  The
Company   anticipates  that  the  monthly  rent  on  such  a  facility  will  be
approximately  $25,000 per month and that the facility  will be adequate to meet
the Company's needs for the foreseeable future.

Proprietary Rights

        McGlen regards its copyrights,  trademarks,  trade dress, trade secrets,
and similar intellectual property as critical to its success.  McGlen intends to
rely on trademark and copyright law, trade secret protection and confidentiality
or license  agreements  with its  employees,  customers,  partners and others to
protect  its  proprietary  rights.  McGlen  has  filed  an  application  for the
registration  of its  tradename  "McGlen.com"  with the United States Patent and
Trademark Office.  Effective trademark,  copyright,  and trade secret protection
may not be  available  in every  country  in which  McGlen's  products  are made
available through the Internet. McGlen is aware that third parties, particularly
competitors,  have, from time to time, copied  significant  portions of McGlen's
website design and directory listings for use in competitive  Internet services.
The  distinctive  elements of McGlen's  web-sites may not be  protectible  under
copyright law. McGlen cannot guarantee the steps McGlen has taken to protect its
proprietary rights will be adequate.

        Many parties are actively  developing search,  indexing,  e-commerce and
other web-related technologies.  McGlen believes that such parties will continue
to  take  steps  to  protect  these   technologies,   including  seeking  patent
protection.  Disputes regarding the ownership of such technologies are likely to
arise in the future. For example,  McGlen is aware that a number of patents have
been issued in the areas of  electronic  commerce,  online  auctions,  web-based
information indexing and retrieval, online direct marketing, common Web graphics
formats and mapping technologies. McGlen anticipates that additional third party
patents will be issued in the future.  McGlen has not received any  infringement
claims  against  McGlen in the form of  letters,  lawsuits  and  other  forms of
communication.  In the event  that  there is a  determination  that  McGlen  has
infringed  such  third-party  patent  rights,  McGlen  could  incur  substantial
monetary liability and be prevented form using the rights in the future.

                                       25

<PAGE>

                                                               McGlen Micro Inc.
--------------------------------------------------------------------------------

Employees

        McGlen  has  65  employees  of  which  7  are  administrative  and 5 are
management.  The Company is not a party to any collective bargaining agreements.
The Company believes that its relations with its employees are good.

                      MANAGEMENT'S DISCUSSION AND ANALYSIS

        The  following  discussion  of the  financial  condition  and results of
operations of McGlen and its wholly owned  subsidiary AMT Component Inc. ("AMT")
should be read in conjunction with the Financial Statements, including the Notes
thereto, for each of McGlen and AMT and the Risk Factors,  included elsewhere in
this Memorandum.

Overview

        McGlen is a global Internet retailer of computer hardware,  software and
peripheral  products to the consumer and small office/home  office  marketplace.
With  more  than  85,000  SKUs,   McGlen  offers  an  online   "superstore"   at
www.McGlen.com and through its subsidiary AMT with AccessMicro.com, that provide
onestop shopping for domestic and international customers, 24 hours a day, seven
days a week.  McGlen's online stores feature a fun, easy to navigate  interface,
competitive   pricing,   extensive  product   information  and  powerful  search
capabilities.

        McGlen has grown  rapidly  since its  inception in 1996.  McGlen had net
income of $59,719 and $151,507 for the years ended  December 31, 1998, and 1997,
respectively.  Costs  associated with the acquisition of AMT and the merger with
Adrenalin,  caused  McGlen to suffer a small loss in the first two  quarters  of
1999.  AMT had net income of $131,410 for the period ended December 31, 1998 and
lost $21,500 in the first year of its operations which ended December 31, 1997.

        Since  computer  retailers  typically  have low product  gross  margins,
McGlen's  ability  to regain  profitability  is  dependent  upon its  ability to
increase net sales. To the extent that McGlen's  marketing efforts do not result
in significantly higher net sales, McGlen will be materially adversely affected.
There can be no assurance  that  sufficient  revenues will be generated from the
sale of its products to enable McGlen to regain  profitability on a quarterly or
annual basis. In view of the rapidly  evolving  nature of McGlen's  business and
its limited operating history, McGlen believes that period to period comparisons
of its  operating  results,  including  gross profit and  operating  expenses as
percentage of net sales, or similar results  concerning AMT, are not necessarily
meaningful and should not be relied upon as an indication of future performance.

        McGlen  believes that the key factor  affecting its long-term  financial
success is its  ability to attract  and  retain  customers  in a cost  effective
manner. Currently, McGlen seeks to expand its customer base and encourage repeat
buying through  internal and other sales and marketing  programs.  Such programs
include:   (i)  brand  development,   (ii)  online  and  offline  marketing  and
promotional  campaigns,  (iii) linking programs with targeted McGlen sites, (iv)
personalized  direct marketing  programs  designed to generate repeat sales from
existing customers,  (v) strategic alliances with Internet content providers and
portal sites, and (vi) the development of a one-stop online marketplace.

        McGlen  expects to  experience  significant  fluctuations  in its future
operating results due to a variety of factors, many of which are outside its

                                       26

<PAGE>

                                                               McGlen Micro Inc.
--------------------------------------------------------------------------------

control.  Factors that may affect its operating results include the frequency of
new product releases,  success of strategic alliances,  mix of product sales and
seasonality of sales typically  experienced by retailers.  Sales in the computer
retail  industry  are  significantly  affected by the  release of new  products.
Infrequent  or delayed new product  releases can  negatively  impact the overall
growth  in retail  sales.  Gross  profit  margins  for  hardware,  software  and
peripheral  products vary widely,  with computer  hardware  generally having the
lowest gross profit margins. While McGlen has some ability to affect its product
mix through effective upselling of high margin products, its sales mix will vary
from period to period and McGlen's gross margins will fluctuate accordingly.

McGlen's  Results of  Operations:  for the Fiscal Years Ended December 31, 1998,
and 1997.

        The following  sets forth  selected  items from  McGlen's  statements of
operations and the percentages  that such items bear to net sales for the fiscal
years ended December 31, 1998 ("FY98") and December 31, 1997 ("FY97").

Analysis of significant difference

<TABLE>
<CAPTION>

                                                % of                        % of                               %
                                  1998          Sales         1997         Sales         Difference        Difference
                                  ----          -----         ----         -----         ----------        ----------
<S>                           <C>                <C>       <C>              <C>           <C>                   <C>
Net Sales                     11,525,307         100%      3,660,899        100%          7,864,408              215%
Cost of Sales                  9,707,247          84%      2,991,119         82%          6,716,128              225%
Gross Profit                   1,818,060          16%        669,780         18%          1,148,280              171%
Operating Expenses             1,778,646          15%        520,324         14%          1,258,322              242%
Income from operations            39,414            0        149,456          4%          (110,042)             (74%)
Interest income                    5,105         .04%            752        .02%              4,353              579%
(expenses)
Other income                      15,200           0%          1,299         .0%             13,901             1170%
Net income                        59,719           1%        151,507          4%           (91,788)             (61%)

</TABLE>

FY98 compared with FY97

        Net Sales: Net sales for the year ended December 31, 1998,  increased by
$7,864,408  or 215% to  $11,525,307  compared to  $3,660,899  for the year ended
December  31,  1997.  During the last  quarter  of 1997,  McGlen  completed  and
introduced the  McGlen.com  website,  which featured and promoted  products from
Ingram Micro.  The Ingram Micro name is more widely  recognized  and thus McGlen
turned towards a mass market concept.  Prior to this, McGlen had focused on more
"niche" selling to specialty markets,  primarily memory related. With the change
towards the end of 1997, McGlen experienced a large spike in volume during 1998.

        Cost of  Sales:  Cost of sales for the year  ended  December  31,  1998,
increased by  $6,716,128 or 225% to  $9,707,247  compared to $2,991,119  for the
year ended  December  31,  1997.  McGlen  was able to  control  costs due to the

                                       27

<PAGE>

                                                               McGlen Micro Inc.
--------------------------------------------------------------------------------

ability  to jump  from one  vendor  to  another  based on  pricing.  McGlen  had
established  negotiated rates with some vendors,  such as Battery Biz,  however,
for the most  part,  McGlen  relied on the  bargaining  power of its  purchasing
department which was headed by George Lee. The incremental  increase corresponds
to the increase in sales volume.

         Operating Expenses:  Operating expenses for the year ended December 31,
1998, increased by $1,258,322 or 242% to $1,778,646 compared to $520,324 for the
year ended  December  31,  1997.  The major  components  of  McGlen's  operating
expenses are analyzed as follows:

         Advertising expenses for the year ended December 31, 1998, increased by
$131,584 or 148% to $220,524 compared to $88,940 for the year ended December 31,
1997.  McGlen  conducted  most of its  advertising  on the  Internet,  primarily
through price comparison websites.  McGlen increased advertising to increase its
brand name  awareness.  Many websites were acquired by larger  companies,  which
consolidated ownership and increased McGlen's advertising costs during 1998.

         Credit charge expenses for the year ended December 31, 1998,  increased
by  $247,970  or 21 times to  $259,608  compared  to $11,638  for the year ended
December 31, 1997.

         Shipping  charges for the year ended  December 31,  1998,  increased by
$187,712 or 114% to $352,559  compared to $164,847  for the year ended  December
31,  1997.  This  was  primarily  the  result  of  increases  in the  volume  of
purchases/sales  of Ingram's  products.  Ingram dropship's to McGlen's customers
and charges McGlen for the shipping.

         Payroll for the year ended December 31, 1998,  increased by $339,814 or
285% to $458,863 compared to $119,049 for the year ended December 31, 1997. This
was due to increases in staffing required to meet McGlen's growth.

AMT Results of Operations: for the Year Ended December 31, 1998, and 1997

         The following sets forth items from AMT's  statements of operations and
the  percentages  that such items bear to net sales for the fiscal  years  ended
December 31, 1998 ("FY98") and December 31, 1997 ("FY97").

Analysis of significant difference

<TABLE>
<CAPTION>

                                                   % of                       % of                              %
                                       1998        Sales            1997      Sales        Difference       Difference
                                       ----        -----            ----      -----        ----------       ----------
<S>                                 <C>             <C>        <C>            <C>         <C>                   <C>
Net Sales                           4,634,744       100%       1,503,040      100%        3,131,704             208%
Cost of Sales                       3,818,691        82%       1,150,663       77%        2,668,028             232%
Gross Profit                          816,053        18%         352,377       23%          463,676             132%
Operating Expenses                    684,793        15%         373,877       25%          310,916              83%
Gain/Loss from operations             131,260       2.8%        (21,500)      (1%)          152,760             710%
Interest income (expenses)                150          -               -         -              150             100%
Other income                                -          -               -         -                -             0.0%
Net income                            131,410       2.8%        (21,500)      (1%)          152,910             710%

</TABLE>

                                       28

<PAGE>

FY98 compared with FY97

         Net Sales: Net sales for the year ended December 31, 1998, increased by
$3,131,704  or 208% to  $4,634,744  compared  to  $1,503,040  for the year ended
December 31, 1997.  The increase was mainly  attributed  to the fact that fiscal
year 1998 was the first full year that AMT had  on-line  purchasing  ability for
its  customers.  The  Internet  rendered  AccessMicro.com  much more  visible to
potential customers.

         Cost of Sales:  Cost of sales for the year  ended  December  31,  1998,
increased by  $2,668,028 or 231% to  $3,818,691  compared to $1,150,663  for the
year ended  December  31,  1997.  AMT  experienced  an increase in the amount of
laptop memory sales and sales of other products.

         Gross Profit:  Gross profit ratio for the year ended December 31, 1998,
decreased  by 5% to 18% as compared to 23% for the first  quarter of 1998.  This
was  mainly due to the change in sales  mix.  AMT sold more items  lower  profit
margin than in 1997.

         Operating Expenses:  Operating expenses for the year ended December 31,
1998 increased by $310,916 or 83% to $684,793  compared to $373,877 for the year
ended December 31, 1997. The major  components of AMT's  operating  expenses are
analyzed as follows.

         Advertising  expenses increased by $78,613 or 65% from $120,613 for the
year ended  December 31, 1997, to $199,226 for the year ended December 31, 1998,
primarily  due to  advertising  and  promotional  activity  by AMT  through  the
Internet.   The  costs  of  Internet   advertising  are  typically  higher  than
traditional print advertising previously utilized by AMT.

         Credit  services  increased by $31,547 or 36% from $88,354 for the year
ended  December 31, 1997, to $119,901 for the year ended  December 31, 1998. The
increase was primarily  due to increases in sales volume,  despite the fact that
AMT was  able to  obtain a lower  interest  rate  due to the  increase  in sales
volume.

         Shipping  charges  increased  by $137,225 or 216% from  $63,359 for the
year ended  December 31, 1997, to $200,584 for the year ended December 31, 1998.
AMT believes that this increase was in line with the increase in sales.

         Salaries  and wages  increased by $106,866 or 258% from $41,421 for the
year ended  December 31, 1997, to $148,287 for the year ended December 31, 1998.
Additional  staffing was required to meet AMT's  milestones for continued growth
and there was general wage increases at the end of 1998.

         Web development  charges  increased by $51,049 or 100% from nil for the
year  ended  December  31,  1997.   This  was  attributed  to  the  increase  in
expenditures for the improvements to AMT's website.

                                       29

<PAGE>

                                                               McGlen Micro Inc.
--------------------------------------------------------------------------------

Consolidated McGlen and AMT Results of Operations: for the Six Months Ended June
30, 1999 and 1998

         The following sets forth selected  items from the  consolidated  McGlen
and AMT statements of operations and the percentages that such items bear to net
sales for the six months ended June 30, 1999, and June 30, 1998.

Period ended June 30, 1999 and 1998

<TABLE>
<CAPTION>

                                                             % of                       % of                             %
                                              1999          Sales         1998          Sales       Difference       Difference
                                              ----          -----         ----          -----       ----------       ----------
<S>                                       <C>                <C>        <C>             <C>        <C>                   <C>
Net Sales                                 11,854,893         100%       5,996,738        100%        5,858,155              98%
Cost of Sales                              9,978,868          84%       4,786,659         80%        5,192,210             108%
Gross Profit                               1,876,025          16%       1,210,080         20%          665,945              55%
Operating Expenses                         1,897,998          16%         849,886         14%        1,048,112             123%
Gain/Loss from operations                   (21,973)       (.19%)         360,194       6.01%        (382,167)           (106%)
Interest income (expenses)                                                  2,793        .05%          (2,793)           (100%)
Net income                                  (21,973)       (.19%)         362,987       6.05%        (384,960)           (106%)

</TABLE>

         Net Sales: Net sales are comprised of product sales, net of returns and
allowances.  Product  sales are  comprised  of computer  hardware,  software and
accessories.  Net sales  increased by $5,858,155 or 98% from  $5,996,738 for the
six months ended June 30, 1998 to $11,854,893  for the Six months ended June 30,
1999.  McGlen  believes  that  this  increase  was  primarily  a  result  of the
successful launch of its new website that featured Ingram Micro's  products,  an
increased drive towards a mass marketing  concept and an increase  customer base
and repeat purchases from existing customers.

         Cost of Sales:  Cost of sales  consists of the cost of the  merchandise
McGlen sells. Cost of sales increased $5,192,210 or 108% from $4,786,659 for the
six months ended June 30, 1998, to $9,978,868  for the six months ended June 30,
1999. This increase was the result of an increase in product sales volume.

         Gross  Profit:  Gross  profit  ratio for the six months  ended June 30,
1999,  decreased  by 4% to 16% as  compared  to 20% for the same period in 1998.
During  1998,  McGlen made an attempt to expand the market share of its products
by lowering its selling price.  Additionally,  the decrease was  attributable to
sales mix of products.

         Operating  Expenses:  Operating expenses for the six months ending June
30, 1999, increased by $1,048,112 or 123% to $1,897,998 compared to $849,886 for
the same six month period in 1998.  Major  components of operating  expenses are
analyzed as follows.

         Credit services  increased by $128,100 or 90% from $141,847 for the six
months  ending June 30,  1998,  to $269,947  for the six months  ending June 30,
1999.  Credit services charges are  traditionally  approximately  two percent of
sales. McGlen considers the increase reasonable.

                                       30

<PAGE>

                                                               McGlen Micro Inc.
--------------------------------------------------------------------------------

         Shipping  charges  increased by $357,131 or 229% from  $155,675 for the
six months  ending June 30, 1998, to $512,806 for the six months ending June 30,
1999. McGlen believes that the increase was in line with the increase in sales.

         Payroll  increased  by $260,302 or 131% from  $198,515 in the first six
months of 1998, to $458,816 in the first six months of 1999. Additional staffing
was required to meet the goal for continued  growth and there was a general wage
raise at the end of the year.

         Professional  services  increased  by $21,597  or 153% from  $14,123 in
first six months of 1998,  to  $35,720  in first six  months of 1999.  Telephone
expenses as a percentage of sales are consistent with the prior period.

         Advertising,  Sales and  Marketing:  Advertising,  sales and  marketing
expenses consist primarily of fees paid to strategic  partners,  advertising and
promotion costs,  sales,  marketing and customer  service  personnel and related
expenditures,  as direct  selling  expenses.  For the six months ending June 30,
1999,  advertising,  sales and marketing  expenses  increased by $145,851 or 93%
from  $157,631  for the six  months  ended  June 30,  1998,  to  $303,482.  As a
percentage of net sales, advertising, sales and marketing expense decreased from
2.63% for the six months ended June 30, 1998,  to 2.56% for the six months ended
June 30, 1999.  The dollar  increases  from  quarter to quarter are  primarily a
result of costs associated with increasing sales.  McGlen intends to pursue more
branding and advertising  campaigns and may enter into other marketing alliances
and, as a result,  may experience  increases in its sales and marketing expenses
in future periods.

         Net Loss: As a result of the foregoing  factors,  McGlen incurred a net
loss of  $21,973  for the six  months  ended  June 30,  1999 and a net profit of
$362,987 for the six months ended June 30, 1998, respectively.

Liquidity and Capital Resources

         As of June 30, 1999,  McGlen had $330,738 in cash and cash  equivalents
compared to  $159,096  as of March 31,  1999.  As of June 30,  1999,  McGlen had
material capital  commitments  consisted of $137,254 in obligations  outstanding
under capital leases.

         McGlen  has a $1.0  million  "ceiling"  credit  agreement  with  Synnex
Information  Systems,  Inc.("Synnex"),  pursuant  to which  Synnex  may,  at its
option,  extend credit to us from time to time to purchase  from Synnex.  McGlen
has net terms of 30 days to pay  Synnex  for the  products  purchased.  To date,
McGlen  has paid  all  obligations  within  30 days  and has  incurred  no extra
expenses  under this  facility.  All of McGlen's  assets are pledged as security
interest  to  secure  this  facility.  As of  August  9,  1999,  McGlen  has  an
outstanding balance of approximately $300,000 under this facility.

         McGlen  also has a  $400,000  credit  agreement  with  Reseller  Credit
Corporation  ("Reseller"),  the asset  financing  company of Ingram Micro,  Inc.
McGlen has net terms of 30 days to pay Reseller for the products  purchased.  To
date,  McGlen  has paid all  notes  within  30 days  and has  incurred  no extra
expenses  under this  facility.  All of McGlen's  assets are pledged as security
interest  to  secure  this  facility.  As of  August  9,  1999,  McGlen  has  an
outstanding balance of approximately $400,000 under this facility.

                                       31

<PAGE>

                                                               McGlen Micro Inc.
--------------------------------------------------------------------------------

         McGlen does not believe that its current cash and cash  equivalents and
short term investments will be sufficient to meet its anticipated cash needs for
working capital and capital  expenditures  for the next 12 months.  If available
cash and cash generated from operations is insufficient to satisfy our liquidity
requirements,  McGlen may seek to sell  additional  equity or debt securities or
obtain a credit  facility.  The sale of additional  equity or  convertible  debt
securities could result in additional dilution to McGlen's and our stockholders.
There can be no  assurance  that  financing  will be  available in amounts or on
terms acceptable to us or McGlen, if at all.

Year 2000 Compliance

         McGlen's  State  of  Readiness:  McGlen  (and  its  subsidiary)  uses a
significant  number of computer  software  programs and operating systems in its
internal operations,  including applications used in order processing, inventory
management,  distribution, financial business systems and various administrative
functions.  To  determine  the effect,  if any, of the Year 2000  Problem on its
operations,  it recently began an audit of its internal  information  systems in
August 1999. Upon completion of this process, McGlen hopes to determine that its
systems  are able to  correctly  interpret  the  upcoming  Year 2000 and whether
principal information systems correctly define the Year 2000 and thus, determine
if the Year 2000 Problem will have material  impact on its systems.  McGlen also
intends to contact  third  parties in an effort to determine the extent to which
the failure of these  parties to timely  identify and correct their own problems
associated  with the Year 2000  Problem  may affect  McGlen.  The third  parties
include  suppliers,  strategic  partners  and key service  providers  (including
contract warehouse and McGlen hosting service providers). This review is ongoing
and will continue through the end of 1999.

         Costs Associated with the Year 2000 Problem: To date the costs incurred
to conduct the review of McGlen's internal  information  systems and to identify
the impact of the Year 2000 Problem on third  parties have been  immaterial  and
McGlen expects that the  additional  costs incurred to complete this review will
also be immaterial. The costs McGlen will incur to address the Year 2000 Problem
could  increase   materially  if  in  completing  the  review  of  its  internal
information  systems,  McGlen  identifies  noncompliant  systems  which  must be
replaced or modified or if it identifies  any other problem  related to the Year
2000 Problem which must be addressed.

         Risks Associated with the Year 2000 Problem:  To the extent that McGlen
assessment fails to identify any  noncompliant  systems operated by McGlen or by
third  parties,  the Year 2000 Problem could have a material  adverse  effect on
McGlen's  operations.  Such  failure  could result in systems  interruptions  or
failures  including the inability to process and ship orders,  to collect credit
card payments and to provide effective  customer service,  which could cause the
loss of business and customers  and could subject  McGlen to claims for damages.
The  severity  of these  possible  problems  would  depend on the  nature of the
problem and how quickly it could be corrected or an alternate implemented, which
is unknown at this time.

         Contingency  Plan:  McGlen  believes that its efforts towards Year 2000
compliance are behind  schedule.  McGlen will continue to monitor the need for a
contingency  plan based on the results of its Year 2000  compliance  review once
the review is completed.

                                       32

<PAGE>

                                                               McGlen Micro Inc.
--------------------------------------------------------------------------------

Material Changes in Operations for the Six Months Ended June 30, 1999

         On March 31, 1999,  McGlen  completed the acquisition of AMT Component,
Inc., which resulted in nearly a 100% increase in combined sale revenue.  McGlen
issued  approximately 17.5% of its outstanding shares to the shareholders of AMT
Component,  Inc.  McGlen also  entered into an agreement to merge with us in the
same period.  Both the  acquisition  and the merger  caused  McGlen to expend an
inordinate  amount of resources on legal fees,  accounting  fees and  consulting
fees.

Forward Looking Statements

         This report may contain forward looking statements. Such statements are
based on McGlen's and AMT's management's current expectations and are subject to
a number of  factors  and  uncertainties  that  could  cause  actual  results or
outcomes  to differ  materially  from  those  described  in such  forwardlooking
statements. These statements address or may address the following subjects: Year
2000 readiness, results of operations,  customer growth and retention; expansion
of systems capacity and development of technology; losses or earnings; operating
expenses,  including,  without limitation,  marketing expense and technology and
development  expense;  revenue  growth;  and  international  sales.  We  caution
investors  that there can be no  assurance  that  actual  results,  outcomes  or
business conditions will not differ materially from those projected or suggested
in such  forwardlooking  statements as a result of various  factors,  including,
among others, its limited operating history, unpredictability of future revenues
and operating results, the continued growth of online commerce, risks associated
with  international   sales,   system  failure  and  capacity   constraints  and
competitive pressures. For further information,  refer to the more specific Risk
Factors and uncertainties discussed throughout this report.

                                 USE OF PROCEEDS

         The Company  currently  intends to use the Proceeds of this Offering to
pay the anticipated  expenses of this Offering and for the uses described below.
Assuming at least the Minimum Offering is sold, the net proceeds, after offering
commissions but before other expenses, are expected to be approximately $900,000
and  assuming  the Maximum  Offering is sold the net proceeds are expected to be
approximately  $1,350,000.  It is anticipated that the Proceeds of this Offering
will fund the Company  through the completion of the Adrenalin  Merger if all of
the Units are sold.  There is no  assurance  that the Company can  complete  the
Maximum  Offering during that period.  The anticipated  uses of the net proceeds
are as follows:

<TABLE>
<CAPTION>

                                     Assumes Sale of                     Assumes Sale of
                                     Minimum Offering                   Maximum Offering
                                     ----------------                   ----------------
                                     Amount           %               Amount           %
                                     ------           -               ------           -
<S>                                <C>             <C>            <C>                <C>
General Operating Expenses         $360,000         40%             $400,000          40%
Marketing and Advertising          $360,000         40%             $600,000          44%
Engineering and Development        $180,000         20%             $350,000          26%
TOTAL                              $900,000        100%           $1,350,000         100%
                                   --------        ----           ----------         ----

</TABLE>

                                       33

<PAGE>

                                                               McGlen Micro Inc.
--------------------------------------------------------------------------------

         o        General Operating Expenses

         The Company intends to allocate proceeds to hire additional operational
and support staff to facilitate  the increase in volume.  Funds will be used for
legal  and  merger   expenses   pertaining  to  the  acquisition  of  Adrenaline
Interactive as well as associated facilities expansion. Additional funds will be
used as general operating capital for inventory and credit purposes.

         o        Marketing Expenses

         The Company  intends to use a large portion of these proceeds to create
and build brand  awareness for the McGlen brands,  including  Techsumer.com  and
AccessMicro.com.  The Company will focus on targeted  advertising  activities in
the areas of print,  online, and some radio campaigns  including the creation of
targeted online  promotions to acquire  additional  customers.  Additional funds
will be used  for  P/R,  market  research,  and the  staffing  of key  marketing
positions.

         o        Engineering Expenses

         The Company  intends to use a large portion of these proceeds to design
and  deploy  its  commerce  engine to ensue that the  required  products  can be
processed in accordance with the demand creation  activities  being developed by
the  marketing  department.  Investments  will be made in the areas of hardware,
software, hosting services, application development, and database management.
Additional funds will be used to staff key positions.

                               RECENT TRANSACTIONS

Acquisition of AMT

         On March  15,  1999,  the  Company  completed  the  acquisition  of AMT
Component Inc. ("AMT"). Alex Chen, the Company's Vice President of Marketing was
the  principal  shareholder  of AMT.  Under  the terms of the  acquisition,  the
Company exchanged 450,000 shares of the Company's common stock (calculated prior
to the Company's 10 for 1 stock split), which constituted approximately 17.5% of
the  Company's  common  stock  at the time of the  acquisition  for all of AMT's
assets. If the Company fails to conduct an IPO or merge with a public company by
December 31, 1999,  the purchase  interest  paid to the former AMT  shareholders
will  increase to  approximately  20% of the  Company  and the  Company  will be
required  to issue an  additional  255,000  shares  of Common  Stock  (2,550,000
calculated after the 10 for 1 stock split) to AMT.

Merger with Adrenalin

         On April 30, 1999,  the Company  announced  the signing of a definitive
agreement for a reverse merger,  pursuant to which the Company is to be acquired
by Adrenalin  Interactive,  Inc., a Nasdaq small cap company  trading  under the
symbol  ADRN.   Adrenalin   currently   operates  a  sole  subsidiary,   Western
Technologies,  Inc.  Western  Technologies,  Inc., is a developer of interactive
games and electronic toys based in Los Angeles,  California.  Under the terms of
the  Agreement  and Plan of Merger  (the  "Merger  Agreement"),  Adrenalin  will
exchange  approximately 87.5% of the shares of Adrenalin common stock for all of
the outstanding shares of the Company. One share of the Company's common stock

                                       34

<PAGE>

                                                               McGlen Micro Inc.
--------------------------------------------------------------------------------

will be converted into  approximately one share of Adrenalin's common stock. The
merger is expected to be completed in the fourth quarter of 1999, and is subject
to  numerous  conditions,  regulatory  approval,  and  approval  by  Adrenalin's
shareholders. The Merger Agreement is set forth in full in Adrenalin's Form 8-K,
dated April 30, 1999.  Adrenalin  completed its initial public offering in March
1996. Its operating  results for the fiscal years ended June 30, 1998, and 1997,
included revenues of approximately $2,756,698 and $1,504,420,  respectively, and
net losses of approximately $2,307,831 and $4,486,396, respectively.

Mackenzie Shea, Inc.

         The Company  was  introduced  to  Adrenalin  by  Mackenzie  Shea,  Inc.
("MSI").  Pursuant to its  engagement  letter,  MSI is entitled to receive up to
5.5% of the outstanding  shares of Adrenalin,  calculated  after the Merger with
Adrenalin, for coordinating the merger with Adrenalin and advising and assisting
the Company in raising a minimum of $3,000,000.  The Company is also required to
pay MSI $7,500 per month during the term of MSI's  engagement  with the Company.
Upon completion of the merger with  Adrenalin,  the Company's  shareholders  and
Adrenalin will experience dilution from the issuance of stock to MSI.

Loan From Adrenalin

         Adrenalin  loaned the Company $500,000 of the proceeds from Adrenalin's
approximately  $2,000,000  private placement it completed in July 1999. The loan
is secured by a security  interest in the Company's assets and bears interest at
the rate of 8% per  annum.  The loan is due 366 days  from the date of the first
advance.  The Company has paid $50,000 to Adrenalin as partial  satisfaction  to
the Loan.

Convertible Notes

         On June 16, 1999, the Company borrowed $100,000 from Mr. Akira Miramino
and $100,000 from Mr. Masamitsu Ishihara.  As a result of this transaction,  the
Company  executed two  Convertible  Promissory  Notes with  identical  terms and
conditions  whereby the Company  promises to repay each investor the loan amount
18 months from the  execution of the notes (the "Due  Date"),  plus 10% interest
per annum payable quarterly in arrears.  The investors have the right to convert
the loan amount  into Common  Stock at $2.00 per share any time prior to the Due
Date.  The Common  Stock  issued upon  conversion  of the Notes will provide the
investors with "piggyback"  registration  rights.  As a commission for arranging
the loans,  McGlen paid Pacific Rim Access a commission  of $20,000 and issued a
warrant to Pacific Rim Access to purchase 10,000 shares of McGlen's common stock
for $2.00 per Share,  which  shares also had  "piggyback"  registration  rights,
subject to underwriter approval,  limitation and lockups.  Keiji Miyagawa is the
owner of Pacific Rim Access.

Issuance of Stock as Compensation to The Lin Law Corporation

         The  Lin  Law  Corporation   started  providing  business   consulting,
investment  consulting  and legal  consulting  services ot the Company in August
1998.  Pursuant to the engagement  agreement between The Lin Law Corporation and
the  Company,  the  Company has the option to issue  stock as  compensation  for
services rendered by The Lin Law Corporation. Due to cash flow issues, upon

                                       35

<PAGE>

                                                               McGlen Micro Inc.
--------------------------------------------------------------------------------

presentation  of the invoice for  services  rendered by The Lin Law  Corporation
from August to December  1998,  which  amounted to  approximately  $76,000,  the
Company elected to issue 75,000 shares of the Company's  Common Stock in lieu of
cash as compensation for the services  rendered by The Lin Law Corporation.  The
Lin Law  Corporation  received  registration  rights and piggyback  registration
rights to the 75,000 shares received.

Finance Transaction with Synnex Information Technologies, Inc.

         On May 11,  1999,  the Company  entered  into an  alliance  with Synnex
Information  Technologies,  Inc.  ("Synnex"),  which  is the  wholly-owned  U.S.
subsidiary  of Synnex,  one of the  largest  computer  manufacturers  in Taiwan.
Pursuant to the terms of the Synnex agreement, Synnex will provide payment terms
of net 30 days on up to  $1,000,000  in  trade  payables  and will  provide  the
Company with  favorable  pricing  terms on products  Synnex  distributes  in the
United  States and other  markets  serviced by the  Company.  In  exchange,  the
Company has provided to Synnex the  following:  (i) the option to elect a member
of the  Company's  Board of  Directors;  (ii) the  ability to convert the entire
$1,000,000  into  Common  Stock  at the  price of $1.88 at any time for 3 years;
(iii) demand and "piggyback"  registration  rights; (iv) information rights; (v)
antidilution  rights;  and (vi)  certain  other  favorable  rights.  The Company
promised  to pay a  commission  consisting  of cash  and  warrants  to  Triangle
Associates,  LLC, as described  below.  There are no assurances that Synnex will
not cancel the credit terms in the future.

Brokers Fees for the Synnex Transaction

         The Company paid a commission to Triangle Associates,  LLC, in the form
of warrants to purchase the Company's Common Stock at a discount of up to 25% of
the price of this Offering up to a maximum aggregate exercise price of $750,000,
at any time for 3 years. The Company has also agreed to pay Triangle Associates,
LLC, a cash commission equal to 5% of the amount of a trade credit line extended
or  investment  made by Synnex over an 18 month period.  The cash  commission is
payable in monthly  installments  within 1999. Steve Chen is the principal owner
and manager of Triangle Associates, LLC.

Agreement With First Securities Van Kasper

         The  Company  has  entered  into an  engagement  agreement  with  First
Securities Van Kasper ("FSVK"), which provides that FSVK will use its reasonable
efforts  to  raise  up to  $10,000,000  for  the  Company  after  the  Company's
completion of its proposed  merger with Adrenalin (the "FSVK  Placement").  FSVK
will  receive a  commission  of 7% of the  amount of the  securities  sold and a
warrant to purchase  shares of the  surviving  parent  equal to 7% of the Shares
sold at the same price as paid by the investors in the FSVK placement.

Recent Financing

         In September  1999, The Company  entered into an agreement with Pacific
Rim Access (the "PacRim  Agreement") to immediately raise $800,000.  Pursuant to
the PacRim Agreement, the Company sold 320,000 shares of Common Stock to a group
of Japanese  investors for $2.50 per share,  which shares will have  "piggyback"
registration rights,  subject to underwriter approval,  limitations and lockups.
The Company has agreed to pay  Pacific Rim Access a  commission  equal to 10% of
the purchase  price paid for the shares for an aggregate  commission  of $80,000
and issue to Pacific  Rim Access a warrant to  purchase  shares of Common  Stock
equal to 10% of those sold to the  investors or 32,000  shares of common  stock.
The warrant will have an exercise price of $2.50 per share and the underlying

                                       36

<PAGE>

                                                               McGlen Micro Inc.
--------------------------------------------------------------------------------

shares  will  have  "piggyback"   registration  rights  subject  to  underwriter
approval, limitations and lockups. The placement was made in accordance with the
provision of Rule 506 promulgated under Regulation D of the Act.

Amended Articles of Incorporation

         The  Company has  recently  amended its  Articles of  Incorporation  to
increase  its  authorized  shares of Common  Stock to  50,000,000  shares and to
declare a 10 for 1 stock split  whereby each  outstanding  share of Common Stock
was converted into 10 shares of Common Stock.

                                       37

<PAGE>

                                                               McGlen Micro Inc.
--------------------------------------------------------------------------------

                                 CAPITALIZATION

         The following table sets forth the  capitalization of the Company as of
September 22, 1999, including the sale by the Company of the Minimum Offering of
400,000 Shares and the Maximum Offering of 600,000 Shares. See "RECENT FINANCIAL
TRANSACTIONS."

<TABLE>
<CAPTION>

                                                                        As Adjusted
                                                                        -----------

                                                                           $1,000,000               $1,500,000
                                                                             Minimum                   Maximum
                                            September 22, 1999              Offering                  Offering
                                            ------------------              --------                  --------
<S>                                             <C>                        <C>                       <C>
Cash on Hand                                      $916,130                 $1,816,130                $2,266,130

Shareholders Equity,                               $77,310                    $78,510                   $79,110
Common Stock, no par
value; 50,000,000 shares
authorized; 25,770,000 shares
issued and outstanding, actual;
26,170,000 shares as adjusted,
minimum; 26,370,000 shares as
adjusted, maximum

     Additional Paid in Capital                   $918,463                 $1,817,263                $2,266,663

     Retained Earnings                             $56,562                    $56,562                   $56,562

TOTAL CAPITALIZATION                            $1,052,335                 $1,952,335                $2,402,335
                                                 =========                  =========                ==========

</TABLE>

         The Company's current  stockholders  presently own 25,770,000 shares of
the Company's  Common Stock for which many such  shareholders  have paid nominal
cash consideration.

                                       38

<PAGE>

                                                               McGlen Micro Inc.
--------------------------------------------------------------------------------

                                    DILUTION

         After the Closing of this  Offering with Proceeds to the Company in the
Minimum  Offering of $1,000,000 and in the Maximum  Offering of $1,500,000,  the
investors in this Offering will have an immediate  and  substantial  dilution in
their  investment of up to  approximately  $2.42 per share and $2.41, per share,
respectively. Shareholders prior to this Offering would have a total increase of
up to approximately $.05 per share. See "RISK FACTORS."

<TABLE>
<CAPTION>

                                                                             Assumes Sale          Assumes Sale
                                                                                     of                 of
                                        September 22, 1999                 400,000 Shares         600,000 Shares
                                        ------------------                 --------------         --------------
<S>                                             <C>                           <C>                   <C>
Shares Outstanding                              25,770,000                    26,170,000            26,370,000

Net Equity                                      $1,052,335                    $1,952,335            $2,402,335

Equity Per Share                                     $0.04                         $0.08                 $0.09

Price Per Share in this Offering....................................................................$2.50

Net Tangible Book Value Prior to....................................................$.04
 this Offering

Increase Attributable to Investors .................................................$.03
  in this Offering (Minimum Offering)

Increase Attributable to Investors .................................................$.05
  in this Offering (Maximum Offering)

Proforma Net Tangible Book
 Value Per Share After this
 Offering

         Minimum Offering...........................................................................$.08
         Maximum Offering...........................................................................$.09
                                                                                                    ----

Dilution Per Share to Purchasers
 in this Offering

         Minimum Offering...........................................................................$2.42
                                                                                                    =====
         Maximum Offering...........................................................................$2.41
                                                                                                    =====

</TABLE>

                                       39

<PAGE>

                                                               McGlen Micro Inc.
--------------------------------------------------------------------------------

                                   MANAGEMENT

         The Company's Board of Directors currently consists of George Lee, Mike
Chen, Calbert Lai and Peter Janssen.  The following table sets forth information
about the present directors and the senior officers of McGlen.

       Name              Age     Office
       ----              ---     ------

       George Lee        28      Chief Executive Officer, Director

       Mike Chen         26      President, Chief Technology Officer, Director

       Calbert Lai       43      Director

       Peter Janssen     57      Director

       Robert Brown      34      Chief Marketing Officer

       David Chou        28      Chief Information Officer

George Lee

        Co-Founder and Chief Executive Officer,  Director. George is responsible
for capital growth,  organizational growth,  development of sales and marketing,
and internal operations and finances for the Company.  Prior to founding McGlen,
he held positions in sales at Eva Airways, and in freight forwarding at Immortal
Service.  George  graduated  from the University of California at Irvine in 1993
and was conferred a bachelor of art degree in economics.

Mike Chen

        Co-Founder and President,  Chief Technology Officer,  Director.  Mike is
responsible  for the development  and  coordination  of proprietary  information
technology  applications,  including the website storefront,  internal logistics
applications, and financial reporting tools. Prior to founding McGlen, he was an
independent  software   programmer.   Mike  graduated  from  the  University  of
California  at  Berkeley  in 1995 with a degree in  Electrical  Engineering  and
Computer Science.

Robert Brown

        Chief  Marketing  Officer.  Robert  joined the Company in June 1999,  to
direct the Company's  corporate  and Internet  marketing  strategies.  From 1997
until joining McGlen,  he was Director of Global Sales and Marketing for Philips
Mobile  Computing  Group,  developers of the Philips Nino and Velo. From 1995 to
1997,  Robert was  Director  of  Strategic  Marketing  for  Mitsubishi  Wireless
Communications, Inc., a leading global wireless handset manufacturer and creator
of the first Internet  connected  handset.  From 1992 to 1995, he was the Global
Brand Manager for AST  Computer/Samsung.  He has also held senior  marketing and
technical management positions with Seagate Technology,  Panasonic and TRW Space
Systems. Robert received his Bachelor of Arts in Industrial Engineering from San
Diego State University.

                                       40

<PAGE>

                                                               McGlen Micro Inc.
--------------------------------------------------------------------------------

Calbert Lai

         Director.  A 15-year veteran of Silicon  Valley,  Cal is the President,
Co-Founder  and senior  business  strategist  at I-Storm,  a  publically  traded
e-commerce consulting firm. Prior to forming I-Storm and its subsidiary, Cal was
a  founding  partner  and the Chief  Executive  Officer  of Lai,  Venuti and Lai
Advertising  ("LVL"),  where he  provided  strategic  marketing  and  consulting
services for technology  clients such as IBM, HP, Sun, Cisco and NEC, and helped
launch  many  successful  hi-tech  products  such as the  Palm  Pilot.  Mr.  Lai
previously  held  executive  positions  in the  business  affairs and  community
relations departments at Stanford University.  He received a B.A. in English and
Creative Writing from Stanford University in 1978.

Peter Janssen

         Director. Peter is the founder of Peter Janssen & Associates ("PJA"), a
technology consulting firm specializing in sales marketing and channel marketing
strategies. Prior to founding PJA, Peter was head of Merchandising and Marketing
at Egghead Software,  where he helped implement one of the first Internet retail
sites, Egghead.com. Before joining Egghead, Peter headed sales and marketing for
several  technology  start ups  including  Mindset,  Amdek (a division of Wyse),
Nexgen  Microsystems  and Acer. At Acer,  he developed  the  company's  consumer
channel into a $500 million business.  Early in his career, Peter spent 18 years
at Sears,  where he helped develop the Sears Business System Center. He received
his Bachelors of Arts in Economics from UCLA.

David Chou

         Chief  Information  Officer.  David is  responsible  for  designing and
developing the technical  infrastructure for the Company,  setting the technical
architectural  direction in which the Company is to evolve and building/managing
an efficient IT  organization.  Prior to joining the Company,  David worked as a
Java consultant for Sun Microsystems,  Inc., where he helped major  corporations
to design/develop applications and technical architectures. Prior to joining Sun
Microsystems,  Inc., David was a Senior Developer at Sempra Energy, where he was
responsible  for leading a small team of developers and  developing  large-scale
applications.  David  graduated  from UC  Berkeley  in  1994  with a  degree  in
Industrial Engineering and Operations Research.

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

         The Company is not aware of any "family  relationships"  (as defined in
Item  401(d) of  Regulation  S-K  promulgated  by the  Securities  and  Exchange
Commission) between any of the directors and/or any of the executive officers.

                                       41

<PAGE>

                                                               McGlen Micro Inc.
--------------------------------------------------------------------------------

                             EXECUTIVE COMPENSATION

         The following table sets forth certain  information with respect to the
annual and long-term  compensation of the executive officers and other employees
of the Company. All officers and directors will be reimbursed for any reasonable
expenses incurred on behalf of the Company.

    Name                    Position                            Base Salary
    ----                    --------                            -----------
    George Lee      Chairman of the Board, CEO                    $  80,000
    Mike Chen       President and Chief Technology Officer,
                    Director                                      $  80,000
    Robert Brown    Chief Marketing Officer                       $ 155,000
    David Chou      Chief Information Officer                     $ 105,000

Employment Agreements

         George  Lee.  The  Company has  entered  into an  Executive  Employment
Agreement with George Lee to serve as the Company's Chief Executive  Officer for
a term of 5 years,  which will commence on the effective  date of the merger and
terminate 5 years thereafter.  The Employment  Agreement provides for an initial
base salary of $80,000 per year.  His  Employment  Agreement  also  provides for
certain bonuses and stock options.

         Mike  Chen.  The  Company  has  entered  into an  Executive  Employment
Agreement  with  Mike  Chen  to  serve  as the  Company's  President  and  Chief
Technology  Officer for a term of 5 years,  which will commence on the effective
date of the merger and terminate 5 years  thereafter.  The Employment  Agreement
provides  for an  initial  base  salary  of  $80,000  per year.  His  Employment
Agreement also provides for certain bonuses and stock options.

         Robert  Brown.  The Company has entered  into an  Executive  Employment
Agreement with Robert Brown to serve as the Company's  Chief  Marketing  Officer
for a term of 3 years,  which  commences on September 1, 1999, and terminates on
December 31, 2002. The Employment  Agreement provides for an initial base salary
of $155,000 per year.  His  Employment  Agreement  also  provides for options to
purchase 1,010,000 shares of Common Stock 500,000 at $1.00 per share and 510,000
at 120 day average  market  price per share prior to the vesting of the options,
which vest in various increments over the next 36 months.

         Alex  Chen.  The  Company  has  entered  into an  Executive  Employment
Agreement  with Alex Chen to serve as the Company's  Vice  President of Business
Development  for a term of 2 years,  which  commences  on  October  1,  1999 and
terminates  on September  30, 2001.  The  Employment  Agreement  provides for an
initial base salary of $75,000 per year. His Employment  Agreement also provides
for certain bonuses and options to purchase 350,000 shares of Common Stock.

         David  Chou.  The  Company has  entered  into an  Executive  Employment
Agreement with David Chou to serve as the Company's  Chief  Information  Officer
for a term of 2 years which commences on October 1, 1999, and terminates on

                                       42

<PAGE>

                                                               McGlen Micro Inc.
--------------------------------------------------------------------------------

September 30, 2001. The Employment Agreement provides for an initial base salary
of $105,000 per year. His Employment Agreement also provides for certain bonuses
and options to purchase 260,000 shares of Common Stock.

         The Company has certain other employment and consulting agreements with
other employees and consultants.

Directors Compensation

         The  Company  may  reimburse  directors  for  any  reasonable  expenses
pertaining  to  attending  meetings,  including  travel,  lodging  and meals and
presently  pays  outside  directors  $750 per meeting  for their  service to the
Company.  The Company as agreed to issue options to outside directors (directors
who are not principal  shareholders or officers,  which are presently limited to
Peter Janssen and Calbert Lai, to purchase up to 100,000 shares of the Company's
common stock for $1.00 per share,  20,000 of which vested upon their  acceptance
of Board of Directors  appointments  and 20,000 of which vest at the end of each
year the directors  serve, for a period of 4 years. The Company has entered into
indemnification and reimbursement agreements with its outside directors.

Stock Option Plan

         The Board of Directors  adopted and the shareholders  have approved the
Company's  1999 Stock Plan for  Incentive and  Non-Qualified  Stock Options (the
"Plan") in December  1998. The Plan was  established  to furnish  incentives for
employees,  consultants and other  participants to continue their service to the
Company. There are 2,500,000 shares of Common Stock authorized for issuance upon
exercise of options and stock appreciation  rights granted under the Plan, which
have  been  designated  to vest  over a 5 year  period.  As of the  date of this
Memorandum,  1,725,000 options to purchase shares of Common Stock under the Plan
had been issued and 352,500 options has vested. The Plan will be administered by
the  Company's  Board of  Directors.  The Company  may have to issue  additional
stock,  options or other incentives to attract and retain  qualified  management
and directors,  both advisory and voting. Such plans and incentives could have a
dilutive effect on the Common Stock.

Indemnification of Officers and Directors

         The  Company's  bylaws  provide  that the  Company  may  indemnify  its
officers and  directors,  employees and agents and former  officers,  directors,
employees and agents  (unless the conduct of such person is finally  adjudged to
have been  grossly  negligent  or to  constitute  willful  misconduct),  against
expenses  including  attorneys'  fees,  judgments,  fines,  and amounts  paid in
settlement and reasonable incurred by him or her in connection with such action,
suit, or proceeding, including any appeal thereof, subject to the qualifications
contained in California  law as it now exists.  Expenses  (including  attorneys'
fees) incurred in defending a civil or criminal action, suit, or proceeding will
be paid by the Company in advance of the final disposition of such action, suit,
or proceeding  upon receipt of an  undertaking  by or on behalf of the director,
officer,  employee or agent to repay such amount,  unless it shall ultimately be
determined  that he or she is not entitled to be  indemnified  by the Company as
authorized  in the bylaws.  Indemnification  thereunder  shall  continue as to a
person who has ceased to be a director,  officer,  employee or agent,  and shall
inure to the benefit of the heirs, executors, and administrators of such person.
The foregoing  rights of  indemnification  are not to be deemed exclusive of any
other rights to which any such person may  otherwise be entitled  apart from the
bylaws.  California  law generally  provides that a corpora tion shall have such
power to indemnify such persons to the extent they acted in good faith in a

                                       43

<PAGE>

                                                               McGlen Micro Inc.
--------------------------------------------------------------------------------

manner  reasonably  believed to be in, or not opposed to, the best  interests of
the Company  and,  with  respect to any criminal  action or  proceeding,  had no
reasonable  cause to believe  the conduct  was  unlawful.  In the event any such
person shall be judged liable for negligence or misconduct, such indemnification
shall apply only if approved by the court in which the action was  pending.  Any
other  indemnification  shall be made only after the  determination by the Board
(excluding any directors who were party to such action),  by  independent  legal
counsel in a written opinion,  or by a majority vote of stockholders  (excluding
any stockholders who were parties to such action).

         INSOFAR AS INDEMNIFICATION FOR LIABILITIES ARISING UNDER THE SECURITIES
ACT OF 1933 MAY BE PERMITTED TO DIRECTORS,  OFFICERS OR PERSONS  CONTROLLING THE
COMPANY PURSUANT TO THE FOREGOING PROVISIONS, THE COMPANY HAS BEEN INFORMED THAT
IN THE OPINION OF THE SECURITIES AND EXCHANGE  COMMISSION,  SUCH INDEMNIFICATION
IS AGAINST PUBLIC POLICY AS EXPRESSED IN THE ACT AND IS THEREFORE UNENFORCEABLE.

                             PRINCIPAL SHAREHOLDERS

         The  following  table sets forth the number of shares of the  Company's
Common  Stock  beneficially  owned  as of the  date  of this  Memorandum  and as
adjusted  to reflect  the sale of the  Minimum  Offering  of 400,000  Shares and
Maximum  Offering of 600,000 Shares by the Company,  by: (i) owners of more than
5% of the Company's  Common Stock;  (ii) each executive  officer and director of
the  Company  that owns  Common  Stock;  and (iii) all  executive  officers  and
directors of the Company as a group.

<TABLE>
<CAPTION>

                                                              Percentage of Beneficial Ownership
                                                              ----------------------------------
                                 Actual
                            Number of Shares            Prior to          If Minimum          If Maximum
Beneficial Owner           Beneficially Owned           Offering         Offering Sold       Offering Sold
----------------           ------------------           --------         -------------       -------------
<S>                           <C>                        <C>                <C>                  <C>
George Lee                    10,000,000                 38.80%             38.21%               37.92%
Mike Chen                     10,000,000                 38.80%             38.21%               37.92%
ACST Computers, Inc.1          4,500,000                 17.46%             17.20%               17.07%

All Officers and
Directors as a Group          20,000,000                 77.61%             76.42%               75.84%

</TABLE>

     Directors  Cal Lai and Peter  Janssen  each own  20,000  vested  options to
purchase  Common Stock at $1.00 per share,  but do not own any actual  shares of
the Company's  Common Stock.  The Company's only other  shareholders are The Lin
Law Corporation, Jimmy Chen and Teresa Wu. See "RECENT TRANSACTION."

--------
1         ACST Computers, Inc., is the former owner of the Company's subsidiary,
          AMT Component Inc., and is controlled by Alex Chen, the Company's Vice
          President Business Development.

                                       44

<PAGE>

                                                               McGlen Micro Inc.
--------------------------------------------------------------------------------

                            DESCRIPTION OF SECURITIES

Shares

         This  Offering  consists  of a minimum  of 40 Units and a maximum of 60
Units. Each Unit consists of 10,000 Shares of the Company's Common Stock, no par
value per Share.  The terms,  conditions,  preferences  and rights of the Common
Stock are briefly summarized below.

Common Stock

         The Company's authorized capital stock consists of 50,000,000 shares of
Common Stock, no par value per share. As of the date of this  Memorandum,  there
were 25,770,000 shares of Common Stock outstanding.

         Each issued and  outstanding  share of Common Stock entitles the holder
to one vote on all matters submitted to a vote of stockholders.  The Articles of
Incorporation,  as amended, make no provision for conversion rights,  redemption
privileges or sinking funds with respect to the Company's  securities.  Upon any
liquidation, dissolution or winding up of the affairs of the Company, holders of
Common  Stock are entitled to receive pro rata all of the assets  available  for
distribution  to  shareholders.  Assets will be available to  shareholders  only
after payment or provision for payment of all debts and other liabilities of the
Company.

Dividend Policy

         The Company intends to retain all earnings for the purpose of financing
the further  development  of the  Company.  The payment by the Company of future
dividends,  if any, is within the  discretion of the Board of Directors and will
depend  upon the  Company's  earnings,  if any,  its  capital  requirements  and
financial  condition,  as well as other relevant factors. The Board of Directors
does not intend to declare any dividends on the Common Stock in the  foreseeable
future, but instead intends to retain all earnings,  if any, for development and
expansion of the Company's operations. See "RISK FACTORS."

                              TERMS OF THE OFFERING

        The Company will sell a minimum of 40 Units or 400,000  Shares and up to
a maximum of 60 Units or 600,000 Shares in this Offering, at a purchase price of
$25,000 per Unit for an aggregate  Maximum Offering price of $1,500,000  (before
paying any commissions and the expenses of this Offering). Each Unit consists of
10,000 shares of Common Stock.  The minimum purchase is one Unit,  however,  the
Company reserves the right to accept  subscriptions  for fractional  Units. This
Offering will be made  pursuant to an exemption  from  registration  provided by
Section 4(2) of the Act and Rule 506 of Regulation D  promulgated  under the Act
and exemptions  available under applicable  state securities acts.  Accordingly,
the  Units  will  only be sold to  accredited  investors.  See  "DESCRIPTION  OF
SECURITIES" and "INVESTOR SUITABILITY STANDARDS."

Subscription Period

        No Units will be sold  unless the  Company  has  received  and  accepted
subscriptions  from  purchasers for a minimum of 40 Units.  Upon the sale of the
Minimum Offering, a Closing may be held and the Company may cause the Escrow

                                       45

<PAGE>

                                                               McGlen Micro Inc.
--------------------------------------------------------------------------------

Agent to disburse the  Proceeds to the  Company,  after the payment of all costs
associated with this Offering, including commissions to the Placement Agent, and
any costs or fees.  Additional  closings may be held from time to time until the
earlier to occur of the sale of all of the Units or the Termination Date.

Payment and Escrow

        Upon   execution   and  delivery  of  a  Subscriber   Questionnaire,   a
Subscription  Agreement  and Internal  Revenue  Service Forms W-8 and W-9 in the
forms attached hereto as Exhibits "A" and "B", a purchaser of Units must pay the
full purchase  price of Units for which they have  subscribed.  The Escrow Agent
will  promptly  return  subscription  funds to a subscriber if at least 40 Units
offered hereby are not subscribed for and accepted by the Company on or prior to
the Termination Date.

Plan of Distribution

        The Units  will be offered on a  "best-efforts"  basis by the  Placement
Agent.  The Company has agreed to indemnify the Placement  Agent against certain
liabilities, including liabilities under the Act, insofar as indemnification for
liabilities arising under the applicable securities laws may be permitted to the
Placement Agent. In the event any investor independently uses the services of an
investment  advisor or purchaser  representative in connection with the purchase
of Units, the payment of any commissions, fees or similar compensation,  will be
the sole  responsibility  of that  investor,  and  neither  the  Company nor the
Placement Agent will have any liability for such compensation.

Placement Agent Agreement

        The Company  entered into an agreement with Redstone  Securities,  Inc.,
dated September 14, 1999,  pursuant to which Redstone agreed to act as Placement
Agent of up to 60 Units (the "Placement Agent  Agreement").  The Placement Agent
Agreement  provides that Redstone shall act as the exclusive  Placement Agent in
this Offering,  that Redstone anticipates funding of the Minimum Offering within
three weeks of delivery of this Memorandum,  that the Company shall pay Redstone
a  placement  fee  equal  to 10% of the  gross  proceeds  of this  Offering  and
reimburse  Redstone  for  travel  and  other  out-of-pocket  expenses  under the
Offering and provide indemnification as set forth above.

Closing

        This  Offering will  automatically  terminate on the earlier to occur of
the sale of all of the Units or October 15, 1999,  or any  extension  thereof at
the  discretion  of the  Company.  At such time  during the  Offering  Period as
subscriptions  for 40 Units have been received and accepted by the Company,  the
Company may hold a Closing, after which time net proceeds will be made available
to the Company for the  purposes  described in "USE OF  PROCEEDS."  In the event
such a Closing is held,  the Company may  continue to sell Units and deposit net
proceeds from such sales  directly  into its  operating  account from the escrow
account  and begin using the  Proceeds  from such sales in  accordance  with the
purposes  described  herein until the earlier of the sale of all of the Units or
the end of the Offering Period. See "USE OF PROCEEDS."

                                       46

<PAGE>

                                                               McGlen Micro Inc.
--------------------------------------------------------------------------------
Escrow Agreement

        The Company has entered into an Escrow  Agreement  with the Escrow Agent
in  which  all  funds   received   from   investors   will  be  held  in  a  non
interest-bearing account controlled by the Escrow Agent. The funds in the escrow
account will not be released to the Company until  subscriptions for 40 Units or
funds  totaling  $1,000,000  are in the escrow  account and the Escrow Agent has
received joint instructions from the Company and the Placement Agent authorizing
the Escrow  Agent to release the funds.  In the event that the Minimum  Offering
has not been received by the Escrow Agent by October 15, 1999, (or any extension
thereof  up to an  additional  45 days  agreed  to by the  Company),  all  funds
received  by the Escrow  Agent will be  returned  to the  respective  investors,
without interest or deduction.

        The funds in the Escrow Account may be at risk in the event of a failure
of the financial  institution in which the funds are deposited,  once such funds
exceed $100,000, the limit of federal deposit insurance. Prior to the use of the
Proceeds  from the sale of the Units,  the Company  presently  intends to invest
such  Proceeds in either  United  States  Treasury  bills or money market mutual
funds that invest in government securities or other securities guaranteed by the
United States Government,  or in a separately  designated  interest-bearing bank
account or  certificate of deposit.  Any interest  earned on such funds from the
time they are deposited  into the escrow  account until they are utilized by the
Company will belong to the Company. See "RISK FACTORS."

             SECURITIES MATTERS AND RESTRICTIONS ON TRANSFERABILITY

        The Units and the  Common  Stock  offered  hereby  are  "securities"  as
defined by the Act and state securities  laws.  Neither the Units nor the Common
Stock have been registered under the Act in reliance upon the "private offering"
exemption from registration contained in Section 4(2) of the Act and Rule 506 of
Regulation  D and have not been  registered  under  the  securities  laws of the
states where the Units are being offered.

        As a result of various Commission guidelines and judicial case law which
has developed in connection  with the exemption  from  registration  provided by
Section  4(2)  of the  Act,  this  Offering  is  limited  to  investors  who are
"accredited investors." See "INVESTOR SUITABILITY STANDARDS." Representations of
each  prospective  investor  with regard to the  foregoing,  as set forth in the
Subscriber  Questionnaire,  will be reviewed by the Company to determine whether
the Units may lawfully be offered to and purchased by the prospective  investor.
The  Company  has the  right to  refuse  a  subscription  for  Units in its sole
discretion  if it  determines  that the  prospective  investor does not meet the
suitability  requirements  or that the Units  otherwise  are not an  appropriate
investment for the prospective investor.

        As a  result  of  reliance  by the  Company  on the  federal  and  state
exemptive  provisions  noted above,  the Units and the Common Stock purchased in
this  Offering  will  be  subject  to  certain   restrictions   affecting  their
transferability. The Units and the Common Stock may not be resold or transferred
by any investor to any person without effective registration thereof being filed
under Federal and state securities laws or the availability of an exemption from
registration. Each investor will be required to complete, execute and deliver to
the Company a Subscription  Agreement in the form attached hereto as Exhibit "A"
representing  that the Units are being  purchased  solely for the investor's own
account,  for  investment  purposes  only  and  with  no  present  intention  of
participating  directly or indirectly in a public  distribution of the Units and
that the Units and the Common Stock will not be  transferred  by the investor in
violation of the federal and state securities laws.

                                       47

<PAGE>

                                                               McGlen Micro Inc.
--------------------------------------------------------------------------------

                                  LEGAL MATTERS

        The Company is not presently a party to any lawsuits.

                             ADDITIONAL INFORMATION

        No person is  authorized  by the Company to give any  information  or to
make any  representations  in  connection  with this  Offering  other than those
contained in this Memorandum,  or in agreements or other documents summarized or
referenced herein or delivered herewith. Any information, data or representation
not contained or referenced in this Memorandum must not be relied upon as having
been authorized by the Company.

        There  are  many  documents  which  are  relevant  to  the  transactions
contemplated by this Memorandum and the rights and obligations of the respective
parties. The statements  contained in this Memorandum  constitute only summaries
of  certain  provisions  of such  documents,  do not  purport  to be a  complete
description  of every term and  condition  thereof,  and are  qualified in their
entirety by reference to the actual documents. As with any summary, some details
and exceptions  have been omitted.  If any of the statements in this  Memorandum
are in conflict with any of the terms of any such  documents,  the terms of such
documents will govern.  Thus,  reference is hereby made to the actual  documents
for a complete understanding of their contents. Copies of all documents relating
to this  Offering and the  transactions  contemplated  herein are  available for
inspection  at the offices of the Company  during  ordinary  business  hours and
copies  thereof  will be  made  available  to any  prospective  investor  or the
investor's designated advisors upon written request to the Company.

        During the course of this  Offering  and prior to the sale of any Units,
prospective investors or their designated advisors are entitled to ask questions
of  management  of the  Company or any  persons  acting on  management's  behalf
concerning  the terms and  conditions  of this  Offering or the  business of the
Company,  and to obtain any  additional  information,  to the extent  management
possesses  such  information  or can acquire it without  unreasonable  effort or
expense,  necessary  to verify the  accuracy  and  adequacy  of the  information
provided. Such inquiries and requests for additional information are encouraged,
and should be directed to:

                                 George Lee, CEO
                                McGlen Micro Inc.
                              3002 Dow Avenue, Suite 212
                              Tustin, California  92780
                              Telephone:        (949) 851-8078
                              Facsimile:        (714) 918-1951

Information  regarding  Adrenalin can be obtained from the U.S.  Securities  and
Exchange  Commission or freeedgar.com under the symbol ADRN. Such information or
information  on the Company's  websites  should not be deemed to be part of this
Memorandum. See "RISK FACTORS - Risks Related to the Adrenalin Merger."

        The Company has reserved the right in its sole  discretion  to accept or
reject any potential  investor and to limit the number of Units  acquired by any
one investor.  Any funds rejected will be  immediately  returned to the proposed
investor.

                                       48

<PAGE>

                                                               McGlen Micro Inc.
--------------------------------------------------------------------------------

                              FINANCIAL STATEMENTS

        The Company's audited financial  statements  prepared by Singer,  Lewak,
Greenbaum  &  Goldstein,  LLP,  dated as of  December  31,  1998  and  unaudited
financial statements as of June 30, 1999, follow.

                                       49

<PAGE>

                                                               McGlen Micro Inc.
--------------------------------------------------------------------------------

                                   EXHIBIT "A"

               Subscription Agreement and Subscriber Questionnaire

                                       50

<PAGE>

                                                               McGlen Micro Inc.
--------------------------------------------------------------------------------

                      Purchaser's Name:
                                       ----------------------
                      Date:
                           ----------------------------------
                      Number of Units:
                                      -----------------------
                      Total Investment: $
                                         --------------------

                               MCGLEN MICRO INC.,
                            a California corporation

                             SUBSCRIPTION AGREEMENT

McGlen Micro Inc.
3002 Dow Avenue
Suite 212
Tustin, CA  92780
Attn:  George Lee, President

Dear Mr. Lee:

        1. Application.  The undersigned,  intending to be legally bound, hereby
subscribes for the number of Units set forth above (the "Units") of McGlen Micro
Inc., a California  corporation (the "Company"),  each Unit consisting of 10,000
shares of the Company's common stock (the "Shares"). The undersigned understands
that this  subscription  may be  accepted or rejected in whole or in part by the
Company  in its sole  discretion  and that  this  subscription  is and  shall be
irrevocable unless the Company for any reason rejects this subscription.

        2.  Escrow of Funds.
            ---------------

            (a) Until the sale of a minimum of 40 Units,  subscription  proceeds
will be held in a non  interest-bearing  escrow account with the Escrow Agent as
described in the Company's Private Placement  Memorandum (the "Memorandum"),  as
Escrow Agent, for the benefit of the undersigned.  If the Company rejects all or
a portion of this  subscription,  the Company will  promptly mail or cause to be
mailed to the  undersigned a check for all, or the appropriate  portion,  of the
amount submitted with the subscription.

             (b)  Upon  the  receipt  and  acceptance  of  subscriptions  for an
aggregate of 40 Units,  a closing (the  "Closing") of the sale of the Units will
be held,  at which time the funds will be released to the Company  after payment
of any  commissions  payable  to the  Placement  Agent and  escrow  fees and the
undersigned  will receive  certificates  representing the  undersigned's  Shares
purchased hereunder. Additional closings may be held from time to time until the
earlier  to  occur  of the  sale  of all the  Units  or the  termination  of the
Offering.  If the Company has not  received and  accepted  subscriptions  for an
aggregate  of 40 Units by October 15, 1999  (subject to the  Company's  right to
extend the offering period for an additional 45 days), all subscription proceeds
will be promptly refunded. After all refunds have been made, the Company and its
directors, officers, shareholders,  employees and agents and the Placement Agent
will have no further liability to the undersigned.

                                       51

<PAGE>

                                                               McGlen Micro Inc.
--------------------------------------------------------------------------------
        3.       Representations and Warranties.
                 -------------------------------

                 The undersigned represents and warrants as follows:

                 (a) The  undersigned  has received,  at least 48 hours prior to
the date hereof, and carefully  reviewed the Memorandum,  including all attached
exhibits  and, has relied only on the  information  contained in the  Memorandum
delivered to the  undersigned;  no oral  representations  have been made or oral
information  furnished to the undersigned in connection with the purchase of the
Units  which  were  in  any  way  inconsistent  with  the  Memorandum;  and  the
undersigned  and/or  his  advisors  have  had a  reasonable  opportunity  to ask
questions of and receive  answers  from the Company  concerning  the Units,  the
Shares and the Company.

                 (b) In  addition to his own  evaluation,  the  undersigned  has
relied upon his duly authorized Purchaser Representative(s), and/or professional
advisor(s), if any identified in the Subscriber's  Questionnaire executed by the
undersigned in evaluating  such Units as an investment.  Either the  undersigned
has a  pre-existing  personal  or business  relationship  with the Company or by
reason of his own business or financial experience or the business and financial
experience of the undersigned's  professional  advisor(s) (who is not affiliated
with or  compensated  directly or  indirectly by the Company or any affiliate or
selling agent of the Company with whom he has consulted and upon whose advice he
has  relied,  the  undersigned  has the  capacity to protect  his  interests  in
connection  with this  transaction.  Either the  undersigned or the  undersigned
together with the Purchaser  Representative referred to above, if any, with whom
he has  consulted  and upon whose advise he has relied,  has such  knowledge and
experience in business and financial  matters as will enable the  undersigned to
evaluate the merits and risks of the  prospective  investment in the Company and
to make an informed  investment  decision.  The  undersigned has been advised in
writing by his Purchaser Representative, if any, prior to having acknowledged in
writing  such  Purchaser  Representative  and prior to signing the  Subscriber's
Questionnaire  and this  Subscription  Agreement,  of any material  relationship
between such Purchaser  Representative  or its  affiliates  and the Company,  or
their  affiliates,   which  currently  exists,  is  mutually  understood  to  be
contemplated or which has existed at any time during the previous two years, and
any compensation  received or to be received as a result of such relationship or
in connection with the purchase of the Units.

                 (c) The  undersigned  is able to bear the economic  risks of an
investment in the Units for an  indefinite  period and at the present time could
afford the loss of such investment.

                 (d)  The  undersigned  meets  at  least  one of  the  following
conditions:

                     (i)   The  undersigned,  alone or jointly  with his spouse,
has a net worth of at least One Million Dollars ($1,000,000); OR

                     (ii)  The  undersigned,  alone,  had a gross income for the
prior year and has a  prospective  gross income for the current year of at least
Two Hundred Thousand Dollars ($200,000); OR --

                     (iii) The undersigned  jointly with his spouse, had a gross
income for the prior year and has a  prospective  gross  income for the  current
year of at least Three Hundred Thousand Dollars ($300,000);

                 (e) The undersigned  understands that neither the Units nor the
Shares have been  registered  under the  Securities Act of 1933, as amended (the
"Act"), or registered or qualified under applicable Blue Sky laws, and are being
offered pursuant to the non-public  offering  exemptions  thereunder and that in
this connection the Company is relying on the  representations set forth in this
Subscription   Agreement  and  the  information  provided  in  the  Subscriber's
Questionnaire;

                                       52

<PAGE>

                                                               McGlen Micro Inc.
--------------------------------------------------------------------------------

                 (f) The undersigned  understands and agrees that (i) the Shares
when issued will be "restricted securities" as described in the Act and that the
Units and the Shares sold to the  undersigned  may not be offered or transferred
in any manner unless they are subsequently registered under the Act (or there is
an  applicable  exemption  from such  registration)  and qualified or registered
under  applicable  Blue Sky laws (or there is an applicable  exemption from such
qualification  or  registration);  (ii) an opinion of counsel  acceptable to the
Company has been rendered  stating that such offer or transfer will not violate,
or cause the Company to violate,  any federal or state securities law; (iii) all
applicable  provisions  described in the Memorandum are complied with before any
Units or Shares sold to the undersigned  may be  transferred;  and (iv) they are
not being acquired with a view towards  resale,  fractionalization,  division or
distribution.

                 (g) The  information  which the undersigned has provided in the
Subscriber's  Questionnaire is, to the undersigned's  best knowledge and belief,
true and correct on the date hereof and the  representations  contained  therein
are hereby confirmed and should any such information  (including the location of
his residence)  change prior to the date the undersigned  receives the Company's
acceptance of this Subscription Agreement, the undersigned agrees to immediately
provide the Company with the corrected information.

                 (h) The undersigned and his  professional  advisor or Purchaser
Representative have been furnished with all materials relating to the Company or
anything set forth in the  Memorandum  which they have  requested  and have been
afforded the  opportunity  to make  inquiries of and have received  answers from
representatives of the Company concerning the Company,  the terms and conditions
of the Offering of the Units or any other matters  relating to the Company,  and
have  further  afforded the  opportunity  to obtain any  additional  information
necessary to verify the accuracy of any representations or information set forth
in the  Memorandum  and  exhibits  attached  thereto  (to the extent the Company
possesses such  information or could acquire it without  unreasonable  effort or
expense);

                 (i) The  undersigned  has been furnished and has carefully read
the Memorandum  including the materials  which are exhibits  thereto or enclosed
therewith or otherwise supplied to the undersigned, and is aware that:

                     (i)   Investment   in  the   Company   and  the  Shares  is
speculative  and involves  high economic and other risks and  dependence  upon a
number of factors  which  cannot be  controlled  or  foreseen as outlined in the
Memorandum  including the  possibility  of a total loss of his investment in the
Company; and

                     (ii)  No federal or state  agency has passed upon the Units
or the  Shares  being  offered,  made any  finding  or  determination  as to the
fairness or accuracy of information  contained in the Memorandum or endorsed the
Memorandum, the Shares or the Units.

                 (j) If the  undersigned is a partnership or  corporation,  such
partnership  or  corporation  was not formed for the purpose of investing in the
Company.

                 (k) The undersigned and his purchaser  representative,  if any,
understand that any  certificates  representing  the Shares shall bear a legend,
restricting the transferability of the Shares.

        4.       Indemnification.
                 ----------------

                 The  undersigned  agrees to  indemnify  and hold  harmless  the
Placement Agent for the Company, the Company, and its agents, representatives

                                       53

<PAGE>

                                                               McGlen Micro Inc.
--------------------------------------------------------------------------------

and employees from and against all  liability,  damage,  loss,  cost and expense
(including  reasonable  attorneys'  fees)  which they may incur by reason of the
failure of the  undersigned  to fulfill any of the terms or  conditions  of this
Subscription  Agreement,  or by  reason of any  inaccuracy  or  omission  in the
information   furnished  by  the  undersigned   herein  or  any  breach  of  the
representations  and warranties made by the undersigned  herein or in connection
with the  Memorandum,  or in any  document  provided by the  undersigned  to the
Company.

        5.  Agreement  with Respect to Resale and  Assignment.  The  undersigned
agrees that no Units or Shares will be resold nor any rights or interests in and
under this Agreement assigned without complete compliance with all the terms and
provisions  contained in the Memorandum and its exhibits,  any legends contained
on the Share certificates and any applicable federal or state securities or Blue
Sky laws.

        6. Blue Sky  Matters.  It is  anticipated  that the Units and the Shares
will be offered  for sale in several  states.  The  securities  laws  ("Blue Sky
Laws") of certain of these states require  certain  conditions and  restrictions
relating  to the  offering  to be  disclosed.  A  description  of  the  relevant
conditions and restrictions is set forth in the Memorandum.

        7.  Miscellaneous.
            -------------

            (a)  This   Subscription   Agreement  shall  survive  the  death  or
disability of the undersigned and shall be binding upon the undersigned's heirs,
executors, administrators, successors and permitted assigns.

            (b)  This   Subscription   Agreement   has  been  duly  and  validly
authorized, executed and delivered by the undersigned and constitutes the valid,
binding and  enforceable  agreement  of the  undersigned.  If this  Subscription
Agreement is being  completed on behalf of a corporation,  partnership or trust,
it has been completed and executed by an authorized  corporate officer,  general
partner or trustee.

            (c) The Memorandum,  this  Subscription  Agreement and the documents
referred to herein  constitute the entire  agreement  between the parties hereto
with  respect to the subject  matter  hereof and  together  supersede  all prior
discussions  or  agreements  in respect  thereof;  provided,  however,  that any
capitalized  terms not  defined in this  Subscription  agreement  shall have the
meaning set forth in the Memorandum.

            (d) Within five (5) days after receipt of a written request from the
Company,  the  undersigned  agrees to provide such  information,  to execute and
deliver such  documents  and to take,  or forbear  from taking,  such actions or
provide such further  assurances as  reasonably  may be necessary to correct any
errors in documentation, to comply with any and all laws to which the Company is
subject or to effect the terms of the Memorandum.

            (e) The Company shall be notified  immediately  of any change in any
of the information contained above occurring prior to the undersigned's purchase
of the  Units  or at any time  thereafter  for so long as the  undersigned  is a
holder of the Units or the Shares.

THE UNITS AND THE SHARES REFERRED TO HEREIN HAVE NOT BEEN  REGISTERED  UNDER THE
SECURITIES ACT OF 1933, AS AMENDED,  OR THE SECURITIES  LAWS OF CERTAIN  STATES.
THESE  SECURITIES  MUST BE ACQUIRED FOR INVESTMENT  PURPOSES ONLY AND NOT WITH A

                                       54

<PAGE>

                                                               McGlen Micro Inc.
--------------------------------------------------------------------------------

VIEW  TOWARD  DISTRIBUTION  OR  RESALE,  AND  MAY  NOT  BE  MORTGAGED,  PLEDGED,
HYPOTHECATED  OR OTHERWISE  TRANSFERRED OR OFFERED TO BE SO TRANSFERRED  WITHOUT
(i) AN EFFECTIVE REGISTRATION STATEMENT FOR SUCH SECURITIES UNDER THE SECURITIES
ACT OF 1933,  AS AMENDED,  AND THE  REGULATIONS  PROMULGATED  PURSUANT  THERETO,
UNLESS EXEMPT  THEREFROM,  AND  REGISTRATION  UNDER  APPLICABLE STATE SECURITIES
LAWS,  UNLESS  EXEMPT  THEREFROM,  (ii) AN  OPINION  OF  COUNSEL,  THAT ANY SUCH
TRANSACTION SHALL NOT VIOLATE,  OR CAUSE THE COMPANY TO VIOLATE,  ANY FEDERAL OR
STATE  SECURITIES  LAWS, AND (iii)  COMPLIANCE  WITH ALL  APPLICABLE  PROVISIONS
PRESCRIBED  IN THE  MEMORANDUM.  THE  SECURITIES  OFFERED  HEREBY  HAVE NOT BEEN
APPROVED OR DISAPPROVED BY THE  SECURITIES  AND EXCHANGE  COMMISSION,  ANY STATE
SECURITIES  COMMISSION  OR  OTHER  REGULATORY  AUTHORITY,  NOR  HAVE  ANY OF THE
FOREGOING AUTHORITIES PASSED UPON OR ENDORSED THE MERITS OF THIS OFFERING OR THE
ACCURACY OR ADEQUACY OF THE MEMORANDUM.  ANY  REPRESENTATION  TO THE CONTRARY IS
UNLAWFUL.

        BY  SIGNING  BELOW,  THE  UNDERSIGNED  HEREBY  ACKNOWLEDGES  THAT HE HAS
RECEIVED,  AND UNDERSTANDS THE TERMS OF THE MEMORANDUM INCLUDING THE DESCRIPTION
OF CERTAIN RISKS ASSOCIATED WITH THIS INVESTMENT.

        IN WITNESS  WHEREOF,  the  undersigned  has executed  this  Subscription
Agreement as of the date first written above.

Subscription Amount:                         Residence or Business Address:
                    ---------------------

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

-----------------------------------------
(Signature of Subscriber)                    Street

-----------------------------------------    -----------------------------------
(Print or Type Name)                         City         State         Zip Code

Social Security or Taxpayer Identification   Mailing Address (if different
No.                                          from Residence or Business Address)
   --------------------------------------
                                             -----------------------------------
U.S. Citizen  _______ Yes      _______ No    Street

                                             -----------------------------------
                                             City         State        Zip Code

      Name of Prospective Purchaser:  __________________________________________

                                       55

<PAGE>

                                                               McGlen Micro Inc.
--------------------------------------------------------------------------------

                                                          Date:
                                                               -----------------
                                             Memorandum Number:
                                                               -----------------

                               MCGLEN MICRO INC.,
                            a California corporation

                            SUBSCRIBER QUESTIONNAIRE

        The  information  provided  herein is being furnished for the purpose of
enabling MCGLEN MICRO INC. (the  "Company"),  to determine  whether an offer and
sale of a unit ("Unit") of 10,000  shares of common stock (the  "Shares") may be
made to the  undersigned  prospective  purchaser  ("Prospective  Purchaser")  in
compliance  with certain  exemptions from the  registration  requirements of the
Securities  Act  of  1933,  as  amended  ("Act"),   and  the   qualification  or
registration  requirements of applicable state securities laws ("Blue Sky Laws")
and in accordance with the suitability standards implemented by the Company.

        All  Prospective  Purchasers  must complete the questions  designated by
"All  Subscribers"  in  Part I.  In  addition,  individuals  must  complete  the
questions  designated  by  "Individuals"  in Part I and each of the questions in
Part  II.  Organizations  (e.g.,  corporations,  partnerships  or  trusts)  must
complete the questions  designated by  "Organizations" in Part I and each of the
questions in Part III. Please answer each question,  indicating,  as applicable,
"none" or "not  applicable"  where no affirmative  response is  appropriate.  If
necessary, attach additional pages in answering any question. All answers should
be printed or typed.

       THIS QUESTIONNAIRE IS REQUIRED FOR COMPLIANCE WITH APPLICABLE LAW.

           THE INFORMATION SET FORTH HEREIN WILL BE KEPT CONFIDENTIAL.

PART I - TO BE FILLED OUT BY ALL PROSPECTIVE PURCHASERS

        1.       Name of Prospective Purchaser (All Subscribers).
                 -----------------------------------------------

                 Provide the full legal name of the Prospective  Purchaser(s) in
the precise manner in which the Units and the Shares, if issued,  would be held.
In the case of  organizations,  provide the type of entity  (e.g.,  corporation,
partnership, or trust) and its state of organization.

        2.       Revocable Trust (Organizations).
                 -------------------------------

                 If  the  Prospective  Purchaser  is a  trust,  please  indicate
whether  the  grantor  has the power to revoke  the trust at any time and regain
title to trust assets.

                 Yes                No
                     -----              -----

                                       56

<PAGE>

                                                               McGlen Micro Inc.
--------------------------------------------------------------------------------

                 If  the  answer  to  this   question  is  yes,  the   remaining
information in this Questionnaire should be given as to the grantor(s).

        3.       Residence Address and Telephone Number (Individuals).
                 ----------------------------------------------------

                 Please indicate your residence address and telephone number.

        4.       Length of Residence (Individuals).
                 ---------------------------------

                 How long have you lived at your present residence?

                 If you have  lived at your  present  address  for less than one
year, please give the addresses of all other residences during the last one year
period.

        5.       Business Address and Telephone Number (All Subscribers).
                 -------------------------------------------------------

                 Please indicate your business address and telephone number.

        6.       Method of Investment Evaluation (All Subscribers).
                 -------------------------------------------------

                 Please select and initial one of the following alternatives:

           ----- ALTERNATIVE   ONE:  The  undersigned  has  such  knowledge  and
                 experience  in  financial  and  business  matters  so  as to be
                 capable of evaluating  the merits and risks of an investment in
                 the Units and does not desire to utilize  the  services  of any
                 other  person in  connection  with  evaluating  such merits and
                 risks.  As evidence of the  requisite  degree of knowledge  and
                 experience,  the  undersigned  hereby  offers  the  information
                 provided in this Subscriber Questionnaire.

           ----- ALTERNATIVE  TWO:  The  undersigned   intends  to  utilize  the
                 services  of  a  purchaser  representative  acceptable  to  the
                 Company   ("Purchaser   Representative")   in  connection  with
                 evaluating  the merits and risks of an investment in the Units.
                 The undersigned  hereby appoints the  following named person(s)

                                       57

<PAGE>

                 to  be  the  undersigned's   Purchaser   Representative(s)   in
                 connection   with   evaluating  the  merits  and  risks  of  an
                 investment in the Units and the Shares:

                 If  applicable,  list  name(s),   address(es),   and  telephone
                 number(s) of Purchaser Representative(s):

                 The undersigned  hereby  attaches an Subscriber  Representative
Questionnaire concerning the above-named Purchaser Representative(s).

                 The  undersigned   represents  that  the  undersigned  and  the
above-named  Purchaser  Representative(s)  have such knowledge and experience in
financial and business  matters that together they are capable of evaluating the
merits and risks of an investment in the Units and the Shares.

PART II - TO BE FILLED OUT BY INDIVIDUALS ONLY

        1.       Income and Net Worth.
                 --------------------

                 (Note: To calculate  "income" for purposes  herein,  please use
adjusted gross income as reported on the relevant federal tax return).

                 (a) Is your net worth in excess of $1,000,000? (For purposes of
this question,  you may include your spouse's net worth and may include the fair
market value of your home, home furnishings and automobiles.)

                 Yes              No
                     -----           -----

                 (b) Was your  individual  income  during  the past two years in
excess of  $200,000 or your joint  income  with your spouse  during the past two
years in excess of $300,000  and do you  anticipate  that it will reach the same
level in the current year?

                 Yes              No
                     -----           -----

                 (c) Does this  investment  exceed ten percent (10%) of your net
worth?  (For purposes of this question,  you may include your spouse's net worth
and may  include  the fair  market  value of your  home,  home  furnishings  and
automobiles.)

                 Yes              No
                     -----           -----
                 (d)    Estimated income for 1999 (Individual _____ Joint _____)

                     Less than   $ 50,000 _____    $ 50,000 to  $ 69,999  _____
                     $ 70,000 to $ 99,999 _____    $100,000 to  $149,999  _____
                     $150,000 to $199,999 _____    $200,000 to  $299,999  _____
                                                   $300,000 or above      _____

                                       58

<PAGE>

                                                               McGlen Micro Inc.
--------------------------------------------------------------------------------

                 (e)      Last year's income was (Individual _____ Joint _____)

                 Less than    $ 50,000  _____    $ 50,000 to $ 69,999 _____
                 $  70,000 to $ 99,999  _____    $100,000 to $149,999 _____
                 $ 150,000 to $199,999  _____    $200,000 to $299,999 _____
                                                 $300,000 or above    _____

                 (f)      Income for 1997 was (Individual _____ Joint _____)

                 Less than    $ 50,000  _____    $ 50,000 to $ 69,999 _____
                 $  70,000 to $ 99,999  _____    $100,000 to $149,999 _____
                 $ 150,000 to $199,999  _____    $200,000 to $299,999 _____
                                                 $300,000 or above    _____

                 (g)      Estimated   net  worth   (exclusive   of  home,   home
                          furnishings and automobiles):

                 Less than    $100,000  _____    $100,000 to $149,999 _____
                 $150,000 to  $249,999  _____    $250,000 to $399,999 _____
                 $400,000 to  $999,999  _____    $1,000,000 or above  _____

        2.       Business.
                 --------

                 (a) Please indicate your present business  affiliation and your
present title. Describe generally the nature of your duties.

                 (b)  Please  indicate  any  corporations  of  which  you  are a
director or any partnerships in which you are a general partner.

                 (c) Please briefly describe principal positions held during the
last  five  years  and  length  of time at each  position.  What is  sought is a
sufficient  description  to enable  the Issuer to  determine  the extent of your
financial and business background.

        3.       Education.
                 ---------

        Please describe any education  following high school,  including degrees
obtained and schools attended.

        4.       Prior Investment Experience.
                 ---------------------------

                 (a) Please  indicate how  frequently  you invest in  marketable
securities (e.g., publicly-traded stocks, bonds and debentures):

                 [ ] often  [ ] occasionally  [ ] seldom  [ ] never

                                       59

<PAGE>

                                                               McGlen Micro Inc.
--------------------------------------------------------------------------------

                 (b) Please  indicate how frequently you invest in  unmarketable
securities  (e.g.,   unregistered  stock,   limited  partnership   interests  or
securities issued by privately held companies):

                 [ ] often  [ ] occasionally  [ ] seldom  [ ] never

                 (c)  Please  briefly  describe  the  nature of your  investment
experience  identified  in your  answers  to (a) and (b)  above,  and any  other
investment  experience  not covered  above which would  indicate your ability to
evaluate an  investment  in the Units and the  Shares.  If  additional  space is
necessary, please use the opposite side of this page or attach additional pages.

                 (d) Do you make your own  investment  decisions with respect to
the investments listed above?

                 Yes              No
                     -----           -----

                 (e) What are the principal sources of your investment knowledge
or advice? (Check all that apply)

                       First hand experience
                 -----
                       Broker(s)
                 -----
                       Attorney(s)
                 -----
                       Financial publications
                 -----
                       Investment Adviser(s)
                 -----
                       Accountant(s)
                 -----

PART III - TO BE FILLED OUT BY ORGANIZATIONS ONLY

        1.       Organization.
                 ------------

                 (a)      Date organization was formed:

                 (b) Was the  organization  formed for the  specific  purpose of
entering into the proposed transaction?

                 Yes              No
                     -----           -----

                 (c) How many equity holders does this organization have?

                                       60

<PAGE>

                                                               McGlen Micro Inc.
--------------------------------------------------------------------------------

                 (d) What is the Federal Employer  Identification  Number of the
organization?

                 (e)   Describe   the  type  of   business   conducted   by  the
organization.

        2.       Total Assets.
                 ------------

                 Are the total assets of the undersigned  organization in excess
                 of $5,000,000?

                 Yes                   No
                     -----                -----

        3.       Certain Organizations.
                 ---------------------

                 The  organization  is one or more of the following  (check each
applicable paragraph):

-----            (a)      A bank as defined  in Section  3(a)(2) of the Act or a
                          savings and loan  association or other  institution as
                          defined  in  Section  3(a)(5)(A)  of the Act  (whether
                          acting  in  its   individual   capacity  or  fiduciary
                          capacity).

-----            (b)      A broker or dealer  registered  pursuant to Section 15
                          of the Securities Exchange Act of 1934.

-----            (c)      An  employee  benefit  plan  within the meaning of the
                          Employee   Retirement  Income  Security  Act  of  1974
                          ("ERISA") for which the  investment  decision is being
                          made by a plan fiduciary,  as defined in Section 3(21)
                          of ERISA,  which is either a bank,  a savings and loan
                          association,  an  insurance  company  or a  registered
                          investment advisor.

-----            (d)      An employee  benefit  plan within the meaning of ERISA
                          with total assets in excess of $5,000,000.

-----            (e)      A  self-directed  employee  benefit  plan  within  the
                          meaning of ERISA with investment decisions made solely
                          by persons who are  "accredited  investors" as defined
                          in Regulation D under the Act.

Note:            The accredited  investor(s) who makes the investment  decisions
                 for a  self-directed  plan also  must  complete  an  Subscriber
                 Questionnaire  as if such accredited  investor was investing in
                 the Company in an individual capacity.

                                       61

<PAGE>

                                                               McGlen Micro Inc.
--------------------------------------------------------------------------------

PART IV - SIGNATURE

        The  undersigned  understands  that the  Company  will be relying on the
accuracy  and  completeness  of the  undersigned's  responses  to the  foregoing
questions,  and the undersigned represents,  warrants and acknowledges that each
of the following statements are true:

        (a) The answers to the above  questions are complete and correct and may
be relied upon by the Company in determining  whether the  transaction is exempt
from registration under the Act and registration or qualification under any Blue
Sky Laws, and any applicable rules and regulations promulgated by any regulatory
agency in connection with the offer and sale of the Units and the Shares.

        (b) The undersigned will notify the Company  immediately of any material
change  in any of such  information  occurring  prior to the  acceptance  of the
undersigned's subscription.

        (c) The undersigned will provide such additional  information  about the
undersigned as may be requested by the Company.

        (d) In order for the  undersigned  to  purchase  Units,  the Company may
require the undersigned to use a Purchaser Representative.

                                       PROSPECTIVE PURCHASER
                                       (Individuals)

                                       (Signature)

                                       (Printed Name)

                                       (Signature)*

                                       (Printed Name)*

                                       Dated:                           , 1999.
                                              --------------------------

                                       * If joint ownership

                                       62

<PAGE>

                                                               McGlen Micro Inc.
--------------------------------------------------------------------------------

                                     PROSPECTIVE PURCHASER
                                     (Organizations)

                                     (Name of Entity)

                                     (Type of Entity)

                                     (State of Organization)

                                     (Signature of Officer)

                                     (Printed Name and Title of Signing Officer)

                                     Dated:                              , 1999.
                                            -----------------------------

                                       63

<PAGE>

                                                               McGlen Micro Inc.
--------------------------------------------------------------------------------

                                   EXHIBIT "B"

                   Internal Revenue Service Forms W-8 and W-9

                                       64

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00001-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00001-of-00352.parquet"}]]