Investor Summary of:

TEK DigiTel and Franklin Telecom Sign $2M Agreement
Released May 25, 1999

TEK DigiTel Corporation (OTC BB: TEKI) and Franklin Telecom (AMEX: FCM) today announced the licensing agreement for TEK’s V-SERVER iGate product, which is the first in a series of voice/ data convergence products which TEK will release this year. The iGate remains on schedule to begin shipping at the end of this month.

In order to understand the VoIP opportunity which TEK and Frankllin exploit, it helps to understand the status quo of VoIP today: first, the application is live already as an estimated $150 million market with for long-distance calls currently being placed over the Internet. The limitation with the current approach is that even though the call is being placed over the Internet, the dial-up access to the Internet is being granted by the PSTN (Public Switched Telephone Network) through their large, capital-intensive dial-in gateways. The iGate product, as well as the next generation of TEK’s V-SERVER products, counters this limitation by providing Customer Premise Equipment that will enable a customer to access the Internet via a small gateway product that eliminates the need to go through the PSTN. This is ideal for a Small Office Home Office customer who is already a cable or DSL subscriber for Internet connectivity and can use the V-SERVER iGate product to establish VoIP capability while effectively gaining two additional phone lines for VoIP calls. And apart from the advantage to the customer, there is an advantage to the large telephone companies because establishing small gateways through the V-SERVER Customer Premise Equipment eliminates the capital-intensive process of establishing large switches over all the desired coverage areas.

The agreement just signed with Franklin is significant for the following reasons:

• It represents 10,000 units, meaning there are 10,000 new VoIP subscribers.
• A revenue payment of roughly 40% of the total licensing fee is payable upfront, and will be used by TEK to develop the next generation of V-SERVER products.
• The V-SERVER solution is scaleable, allowing subscribers to upgrade and take advantage of product enhancements as they are developed; furthermore, the iGate is a precursor to the V-SERVER Elite, which is scheduled for shipment in late Q3, 1999. (Year end is December 31)