UNITED STATES
                          SECURITIES AND EXCHANGE COMMISSION
                                WASHINGTON, D.C. 20549

                                     FORM 10-QSB

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

                     For the quarterly period ended June 30, 1996

                           Commission file number:  0-27862

                              REALITY INTERACTIVE, INC.
                (Exact name of registrant as specified in its charter)

             MINNESOTA                                   41-1781991
   -------------------------------           ----------------------------------
   State or other jurisdiction of            I.R.S. Employer Identification No.
   incorporation of organization

                SUITE 300
          11200 WEST 78TH STREET
       EDEN PRAIRIE, MINNESOTA 55344                   (612) 996-6777
   --------------------------------------    -----------------------------------
   Address of principal executive offices       Registrant's telephone number

Check whether the registrant (1) filed all reports required to be filed by
Section 13 or 15(d) of the Securities Exchange Act of 1934 during the past 12
months (or for such shorter period that the registrant was required to file such
reports), and (2) has been subject to such filing requirements for the past 90
days.

                                    X   Yes         No
                                  ----         ----

At July 31, 1996, 4,677,407 shares of registrant's $.01 par value Common Stock
were outstanding.

    Transitional Small Business Issuer Format         Yes    X  No
                                                 ----      ----

                                          1

                                  FORM 10-QSB INDEX

PART I  -  FINANCIAL INFORMATION

Item 1.  Financial Statements............................................. 3

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

PART II -  OTHER INFORMATION

Item 6.  Exhibits and Reports on Form 8-K.................................10

SIGNATURES................................................................11

EXHIBIT INDEX.............................................................12

                           SAFE HARBOR STATEMENT UNDER THE
                   PRIVATE SECURITIES LITIGATION REFORM ACT OF 1995

    This Quarterly Report on Form 10-QSB contains forward-looking statements
within the meaning of Section 27A of the Securities Act of 1933, as amended, and
Section 21E of the Securities Exchange Act of 1934, as amended.  These forward-
looking statements involve risks and uncertainties that may cause the Company's
actual results to differ materially from the results discussed in the forward-
looking statements.  Factors that might cause such differences include, but are
not limited to, the uncertainty in growth of a development stage company;
limited growth of the market for multimedia education and training products;
lack of market acceptance of the Company's products; inability of the Company to
expand its marketing capability; inability of the Company to diversify its
product offerings; failure of the Company to respond to evolving industry
standards and technological changes; inability of the Company to meet its future
additional capital requirements; inability of the Company to compete in the
business education and training industry; loss of key management personnel;
inability to retain subject matter experts; failure of the Company to secure
adequate protection for the Company's intellectual property rights; and the
Company's exposure to product liability claims.  The forward-looking statements
are qualified in their entirety by the cautions and risk factors set forth in
Exhibit 99.1, under the caption "Cautionary Statement," to this Quarterly Report
on Form 10-QSB for the quarter ended June 30, 1996.

                                          2

                            PART I - FINANCIAL INFORMATION

ITEM 1. FINANCIAL STATEMENTS

                              REALITY INTERACTIVE, INC.
                            (A DEVELOPMENT STAGE COMPANY)
                                    BALANCE SHEET

                                                                                    June 30,           December 31,
                                                                                      1996                 1995
                                                                                  ------------         ------------
ASSETS                                                                             (Unaudited)
                                                                                                 
Current assets:
    Cash and cash equivalents...........................................          $    586,731         $    118,916
    Short-term investments..............................................             8,049,686                    0
    Accounts receivable.................................................               136,749               18,237
    Interest receivable.................................................                47,042                    0
    Inventory...........................................................                71,493               28,359
    Prepaid expenses....................................................                24,213                8,312
                                                                                  ------------         ------------
        Total current assets............................................             8,915,914              173,824
                                                                                  ------------         ------------
Fixed assets, net.......................................................               212,850              269,852
Restricted cash.........................................................               119,000              119,000
Other assets............................................................                29,481               14,116
                                                                                  ------------         ------------
        Total assets....................................................          $  9,277,245         $    576,792
                                                                                  ------------         ------------
                                                                                  ------------         ------------

LIABILITIES, MANDATORILY REDEEMABLE PREFERRED
    STOCK AND STOCKHOLDERS' EQUITY (DEFICIT)
Current liabilities:
    Accounts payable....................................................          $    187,386         $    188,623
    Accrued liabilities.................................................               100,908               90,417
    Capitalized lease obligation........................................                 4,046               14,127
    Notes payable.......................................................                     0              201,002
    Other current liabilities...........................................                12,695                    0
                                                                                  ------------         ------------
        Total current liabilities.......................................               305,035              494,169
Long-term liabilities...................................................                     0                    0
                                                                                  ------------         ------------
        Total liabilities...............................................               305,035              494,169
                                                                                  ------------         ------------
Mandatorily redeemable convertible preferred stock, $.01 par value,
    5,000,000 shares authorized; 0 and 726,900 shares outstanding,
    respectively........................................................                     0            2,125,962
                                                                                  ------------         ------------

Stockholders' equity (deficit):
    Common stock, $.01 par value, 20,000,000 shares authorized;
        4,677,407 and 1,643,611 shares outstanding, respectively........                46,774               16,436
    Additional paid-in capital..........................................            15,391,620            1,384,397
    Accumulated deficit during the development stage....................            (6,466,184)          (3,444,172)
                                                                                  ------------         ------------
        Total stockholders' equity (deficit)............................             8,972,210           (2,043,339)
                                                                                  ------------         ------------
        Total liabilities, mandatorily redeemable preferred stock and
           stockholders' equity (deficit)...............................          $  9,277,245        $     576,792
                                                                                  ------------         ------------
                                                                                  ------------         ------------

                 See accompanying notes to the financial statements.

                                          3

                              REALITY INTERACTIVE, INC.
                            (A DEVELOPMENT STAGE COMPANY)
                               STATEMENT OF OPERATIONS
                                     (UNAUDITED)

                                                                  Three months ended                    Six months ended
                                                                         June 30,                            June 30,
                                                             -----------------------------       -----------------------------
                                                                  1996             1995               1996            1995
                                                             -----------       -----------       -----------       -----------
                                                                                                       
Revenues................................................     $   125,298       $     3,223       $   248,107       $     6,513
Cost of revenues........................................          22,618               545            46,470             1,082
                                                             -----------       -----------       -----------       -----------
Gross profit............................................         102,680             2,678           201,637             5,431
                                                             -----------       -----------       -----------       -----------

Operating expenses:
    Sales and marketing.................................         713,868           166,190         1,146,189           306,613
    Research and development............................         573,830           319,157           920,166           563,125
    General and administrative..........................         380,637           183,075           658,752           356,337
                                                             -----------       -----------       -----------       -----------
        Total operating expenses........................       1,668,335           668,422         2,725,107         1,226,075
                                                             -----------       -----------       -----------       -----------

Operating loss..........................................      (1,565,655)         (665,744)       (2,523,470)       (1,220,644)
                                                             -----------       -----------       -----------       -----------
Other income (expense):
    Interest income (expense), net......................           6,771            (7,387)         (165,586)           (6,568)
    Debt offering costs.................................         (38,745)                0          (113,486)                0
                                                             -----------       -----------       -----------       -----------
        Total other income (expense)....................         (31,974)           (7,387)         (279,072)           (6,568)
                                                             -----------       -----------       -----------       -----------
    Income before extraordinary loss....................     $(1,597,629)      $  (673,131)      $(2,802,542)      $(1,227,212)

Extraordinary loss from early retirement of debt........        (219,470)                0          (219,470)                0
                                                             -----------       -----------       -----------       -----------
        Net loss........................................     $(1,817,099)      $  (673,131)      $(3,022,012)      $(1,227,212)
                                                             -----------       -----------       -----------       -----------
                                                             -----------       -----------       -----------       -----------
Net loss per common and common equivalent share.........     $      (.44)      $      (.41)      $     (1.05)      $      (.75)
                                                             -----------       -----------       -----------       -----------
                                                             -----------       -----------       -----------       -----------
Weighted average common and common equivalent shares....       4,137,438         1,643,611         2,883,636         1,643,611
                                                             -----------       -----------       -----------       -----------
                                                             -----------       -----------       -----------       -----------

See accompanying notes to the financial statements.

                                          4

                              REALITY INTERACTIVE, INC.
                            (A DEVELOPMENT STAGE COMPANY)
                               STATEMENT OF CASH FLOWS
                                     (UNAUDITED)

                                                                                                 Six months ended
                                                                                                      June 30,
                                                                                     ----------------------------------
                                                                                            1996               1995
                                                                                     --------------      --------------
                                                                                                   
CASH FLOWS FROM OPERATING ACTIVITIES:
    Net loss............................................................             $   (3,022,012)      $  (1,227,212)
    Reconciliation of net loss to net cash used by operating activities:
        Depreciation and amortization...................................                     60,000              34,152
        Noncash interest expense related to warrants....................                    193,979                   0
        Extraordinary loss related to early retirement of debt (interest
             expense related to warrants)...............................                    142,021                   0
    Changes in assets and liabilities:
        Accounts receivable.............................................                   (118,512)             (1,032)
        Interest receivable.............................................                    (47,042)                  0
        Inventory.......................................................                    (43,134)            (34,753)
        Prepaid expenses................................................                    (15,901)            (45,029)
        Accounts payable................................................                     (1,238)             11,171
        Accrued liabilities.............................................                     10,491               9,586
        Other current liabilities.......................................                     12,695                   0
                                                                                     --------------      --------------
            Net cash used by operating activities.......................                 (2,828,653)         (1,253,117)
                                                                                     --------------      --------------
CASH FLOWS FROM INVESTING ACTIVITIES:
    Purchase of fixed assets, net of retirements........................                   (269,155)            (97,704)
    Purchase of other assets............................................                    (15,366)            (12,862)
    Purchase of short-term investments..................................                (10,049,686)                  0
    Sale of short-term investments......................................                  2,000,000              29,836
                                                                                     --------------      --------------
            Net cash used by investing activities.......................                 (8,334,207)            (80,730)
                                                                                     --------------      --------------
CASH FLOWS FROM FINANCING ACTIVITIES:
    Repayments of capital lease obligation..............................                    (10,080)             (8,404)
    Proceeds from convertible notes payable.............................                  2,800,000             865,000
    Repayment of convertible notes payable..............................                 (2,800,000)                  0
    Repayment of notes payable..........................................                   (201,002)                  0
    Proceeds from sale leaseback of fixed assets........................                    266,157                   0
    Proceeds from initial public offering, net..........................                 11,549,607                   0
    Conversion of bridge notes payable..................................                     25,003                   0
    Proceeds from exercise of stock options.............................                        990                   0
                                                                                     --------------      --------------
            Net cash provided by financing activities...................                 11,630,675             856,596
                                                                                     --------------      --------------
Net cash provided (used) during period..................................                    467,815            (477,251)
CASH AND CASH EQUIVALENTS:
    Beginning of period.................................................                    118,916             527,461
                                                                                     --------------      --------------
    End of period.......................................................             $      586,731      $       50,210
                                                                                     --------------      --------------
                                                                                     --------------      --------------

SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION:
    Cash paid for interest..............................................             $       88,867      $        8,899
                                                                                     --------------      --------------
                                                                                     --------------      --------------

                 See accompanying notes to the financial statements.

                                          5

                              REALITY INTERACTIVE, INC.
                            (A DEVELOPMENT STAGE COMPANY)
                            NOTES TO FINANCIAL STATEMENTS
                                    JUNE 30, 1996
                                     (UNAUDITED)

NOTE 1.  SUMMARY OF ORGANIZATION AND SIGNIFICANT ACCOUNTING POLICIES

Organization and Business

    Reality Interactive, Inc. (the "Company") was incorporated on May 24, 1994
to design, develop and market interactive multimedia learning software products
primarily for sale to Fortune 2000 companies.  The Company's strategy is to
identify industry standards and practices that create a need for enterprise-wide
education and training.  The Company uses digital technology, including
animation, video, graphics, audio narration and formatted text, to create its
interactive multimedia learning products.

Basis of Presentation

    The accompanying unaudited financial statements of the Company have been
prepared in accordance with generally accepted accounting principles for interim
financial information.  The preparation of financial statements in accordance
with generally accepted accounting principles require management to make
estimates and assumptions.  Such estimates and assumptions affect the reported
amounts of assets and liabilities as well as disclosure of contingent assets and
liabilities at the date of the accompanying interim financial statements, and
the reported amounts of revenue and expenses during the reporting period.  In
the opinion of management, the interim financial statements include adjustments
necessary for a fair presentation of the results of operations for the interim
periods presented.  Operating results for the six months ended June 30, 1996 are
not necessarily indicative of the operating results to be expected for the year
ending December 31, 1996.

    Certain information and footnote disclosures normally included in financial
statements in accordance with generally accepted accounting principles have been
omitted.  The statements should be read in conjunction with the Company's annual
financial statements included in its Registration Statement on Form SB-2.

NOTE 2.  INITIAL PUBLIC OFFERING

    In April 1996, the Company completed an initial public offering (IPO) of
2,200,000 units at a price of $5.75 per unit.  Each unit sold consisted of one
share of Common Stock and one Redeemable Common Stock Purchase Warrant to
purchase one share of Common Stock.  The sale of such units resulted in gross
proceeds of $12,650,000 and net proceeds of $11,034,982 after payment of the
underwriting discount and related expenses.  Upon the closing of the offering,
all 726,900 outstanding shares of Mandatorily Redeemable Convertible Preferred
Stock were converted into 726,900 shares of Common Stock.

    In May 1996, the Company issued an additional 100,000 units to its
underwriter to cover over-allotments, resulting in gross proceeds of $575,000
and net proceeds of $514,625 after payment of the underwriting discount and
related expenses.

NOTE 3.  CONVERTIBLE NOTES PAYABLE

    In January 1996, the Company closed a $2,800,000 convertible bridge note
financing (the "Bridge Notes") in a private placement, resulting in net proceeds
to the Company of $2,626,570 after payment of agent's commissions and related
expenses.  The Bridge Notes provided for interest at 10% per annum and matured
on the earlier of July 31, 1996 or 30 days after the effective date of an IPO.
In connection with this financing, the Company issued detachable warrants to
purchase a total of 560,000 shares of Common Stock to

                                          6

the purchasers of the Bridge Notes.  The Bridge Notes were convertible into
common stock at a price equal to $3.94, which was 75% of $5.25 (the per share
value assigned to the Common Stock at the time of the IPO).

    In May 1996, 30 days after the effective date of the IPO, the Company made
payments totaling $2,861,281 to repay the Bridge Notes, including accrued
interest of $86,285.  Approximately $25,000 of the Bridge Notes were converted
to Common Stock at the time of this repayment, resulting in the issuance of
6,346 shares.  The Company has recognize an extraordinary loss of approximately
$220,000 in its second quarter ended June 30, 1996 as a result of the early
repayment of its convertible bridge note financing.

NOTE 4.  STOCK OPTIONS

    Under the terms of the Company's 1994 Stock Incentive Plan, 700,000 shares
of Common Stock have been reserved for issuance to officers, employees and
independent contractors upon the exercise of stock options.  The Company has
granted a total of 429,850 options to its officers, employees and independent
contractors at prices ranging from $1.80 to $5.25 per share.  During the quarter
ended June 30, 1996, an employee exercised an option to purchase 550 shares of
Common Stock at an exercise price of $1.80 per share.

                                          7

ITEM 2 - MANAGEMENT'S DISCUSSION AND ANALYSIS OF
         FINANCIAL CONDITION AND RESULTS OF OPERATION

    The following presentation of management's discussion and analysis of the
Company's financial condition and results of operation should be read in
conjunction with the Company's financial statements and notes contained herein.

OVERVIEW

    Reality Interactive, Inc. (the "Company") was formed in May 1994 to design,
develop and market interactive multimedia learning software products primarily
for sale to Fortune 2000 companies.  The Company is a development stage company
and, as a result, has undergone significant changes since its inception as the
focus of the Company's activities has shifted from organization to product
design and development to sales and marketing.  Accordingly, the Company's
revenue and expenses for the periods presented below are not necessarily
indicative of future results.

    The Company has been unprofitable since its inception and expects to incur
operating losses at least through 1997.  During the period from May 24, 1994
(inception) through June 30, 1996, the Company incurred cumulative losses of
$6,466,184.  The Company expects its operating expenses to continue to increase
as it continues to develop new products and increase its sales and marketing
efforts.  To become profitable, the Company must significantly increase revenues
from its initial product, the ISO 9000 REGISTRATION SERIES, and must continue to
introduce new products to the market.  Future operating results will depend upon
many factors, including the demand for the Company's products, the level of
product and price competition, the Company's success in developing its direct
sales force and indirect distribution channels, general economic conditions and
the ability of the Company to develop and market new products and to control
costs.

RESULTS OF OPERATIONS

REVENUES

    Revenues were $125,298 for the quarter ended June 30, 1996, compared to
revenues of $3,223 for the quarter ended June 30, 1995.  For the six month
period ended June 30, 1996, revenues were $248,107, compared to revenues of
$6,513 for the comparable period of 1995.  The revenue increase was due
primarily to the availability of all five titles of the Company's initial
product, ISO 9000 REGISTRATION SERIES, which was released as a complete series
in August 1995, compared to the availability and sale of only one title of the
ISO 9000 REGISTRATION SERIES during the first two quarters of 1995.  The
addition of 5 direct sales employees and 2 telesales employees between December
1995 and January 1996 also contributed to this revenue increase.  In May 1996,
the Company added 7 direct sales employees in key geographic markets across the
U.S.  The Company also added 2 direct sales employees to develop the
international market for its products.  Although the direct sales employees
hired in May did not produce revenue for the second quarter of 1996, the Company
believes that the addition of these positions will enhance its efforts to
penetrate more deeply into the Fortune 2000 marketplace.  During the remainder
of 1996, the Company expects revenues to increase as these direct sales
employees become more productive, new sales channel partners are identified and
new products are introduced.

    COST OF REVENUES.  Cost of revenues were $22,618 for the quarter ended June
30, 1996, compared to $545 for the quarter ended June 30, 1995.  For the six
month period ended June 30, 1996, cost of revenues were $46,470, compared to
cost of revenues of $1,082 for the comparable period of 1995.  The increase in
cost of revenues was primarily due to royalties paid on an increasing level of
sales.  Royalties were paid to the American Society of Quality Control ("ASQC"),
a sales channel for the Company, and Process Management International, the
Company's subject matter expert for its ISO 9000 REGISTRATION SERIES.   Cost of
revenues also includes the cost of media duplication and packaging materials.

                                          8

    OPERATING EXPENSES. The Company's operating expenses for the second quarter
ended June 30, 1996 were $1,668,335, a 150% increase over operating expenses of
$668,422 in the second quarter of 1995.  For the six months ended June 30, 1996,
operating expenses were $2,725,107, a 122% increase over operating expenses of
$1,226,075 for the same period in 1995.  This increase  in operating expenses
between the periods noted for 1996 and 1995 was due primarily to the following:

(a) Sales and marketing expenses were $713,868 for the second quarter of 1996,
    compared to $166,190 for the second quarter of 1995, a 330% increase.  For
    the six months ended June 30, 1996, sales and marketing expenses were
    $1,146,189, compared to $306,613 for the same period in 1995, a 274%
    increase.  This increase between periods was due primarily to the addition
    of new direct sales, telesales and marketing positions and the expansion of
    direct marketing programs.  In May 1996, the Company added 7 new direct
    sales employees in key geographic areas of the U.S and 2 direct sales
    employees to develop the international market.  The Company expects its
    sales and marketing expenses to increase as a result of increasing travel
    expenditures and initiation of marketing programs for its new products
    currently being developed.

(b) Research and development expenses were $573,830 for the second quarter of
    1996, compared to $319,157 for the second quarter of 1995, an 80% increase.
    For the six months ended June 30, 1996, research and development expenses
    were $920,166, compared to $563,125 for the same period in 1995, a 63%
    increase. This increase was attributed to the hiring of additional employees
    to develop three new products, the QS-9000 COMPLIANCE SERIES, a multi-title
    product dealing with automotive quality standards, the ISO 14000 EMS
    CONFORMANCE SERIES, a multi-title product dealing with environmental
    management standards and POLLUTION PREVENTION, a one-title product dealing
    with the key concepts of a pollution prevention program.  The Company began
    developing the ISO 14000 CONFORMANCE SERIES in August 1995, the QS-9000
    COMPLIANCE SERIES in January 1996 and POLLUTION PREVENTION in February
    1996.  Management believes that its products currently under development
    will be released from August to October of 1996.  The Company expects its
    research and development expenses to remain consistent with current levels,
    unless additional projects, if any, are identified, which may require an
    increase in staffing.

(c) General and administrative expenses were $380,637 for the second quarter of
    1996, compared to $183,075 for the second quarter of 1995, a 108% increase.
    For the six months ended June 30, 1996, general and administrative expenses
    were $658,752, compared to $356,337 for the same period in 1995, a 85%
    increase.  This increase was due primarily to increased travel, office
    rent, depreciation expense, operating leases and professional fees.  The
    Company expects that its general and administrative expenses will increase
    as it hires additional accounting staff and expands its office space.

    OTHER INCOME (EXPENSE).  The Company's net other expense was $31,974 for
the second quarter of 1996, compared to net other expense of $7,387 for the
second quarter of 1995.  For the six months ended June 30, 1996, net other
expense was $279,072, compared to net other expense of $6,568 for the same
period in 1995.  This difference was primarily the result of interest expense
associated with the Company's convertible bridge note financing and amortization
of prepaid costs the Company incurred to obtain the bridge note financing.  The
Company also realized interest income of $107,243 and $117,260 in the second
quarter and first six months of 1996 from the investment of bridge note and IPO
proceeds.

    NET LOSS. Net loss, after deducting extraordinary losses from the early
retirement of debt, was $1,817,099 for the second quarter of 1996, compared to a
net loss of $673,131 for the second quarter of 1995.  For the six months ending
June 30, 1996, net loss, after deducting extraordinary losses from the early
retirement of debt,  was $3,022,012, compared to a net loss of $1,227,212 for
the same period in 1995.  The Company expects to continue to experience losses
at least through 1997 as it continues to incur substantial expenditures to
develop its products and to increase its sales.

                                          9

LIQUIDITY AND CAPITAL RESOURCES

    The Company's cash, cash equivalents and short-term investments were
$8,636,417 as of June 30, 1996, compared to $118,916 as of December 31, 1995.
The increase in cash, cash equivalents and short-term investments was primarily
attributed to the Company's IPO in April 1996.  Also contributing to the
increase was lease financing of approximately $266,157 that was obtained in a
sale-leaseback of computer equipment in May 1996.  The decrease in cash and cash
equivalents subsequent to the receipt of the net proceeds from the IPO was due
primarily to the net loss from operations and repayment of bridge note
financing.  See Note 3 for further information on financing transactions.

    Although the Company anticipates that it will experience operating losses
and negative cash flow from operations at least through 1997, and the Company
does not currently have bank financing available, the Company believes that its
current cash balances will be sufficient to meet its working capital and capital
expenditure needs through 1997.  Thereafter, the Company may need to
raise additional funds to finance its operations.  In addition, to the extent
the Company's revenues do not meet management's expectations, or the Company's
growth exceeds management's expectations, the Company may require additional
financing prior to the end of 1997.  At such time, there can be no assurance
that debt or equity financing would be available on favorable terms or at all.

                             PART II - OTHER INFORMATION

ITEM 6.  EXHIBITS AND REPORTS ON FORM 8-K

         (a)  EXHIBITS

         EXHIBIT NO.   DESCRIPTION

               10.1    Equipment Lease between Reality Interactive, Inc. and 
                       Dexxon Capital Corporation Dated June 3, 1996

               27.1    Financial Data Schedules

               99.1    Cautionary Statement

         (b)  REPORTS ON FORM 8-K

                   No Reports on Form 8-K were filed during the quarter ended
                   June 30, 1996

                                          10

                                      SIGNATURES

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

                              REALITY INTERACTIVE, INC.

Dated: August 14, 1996                      By   /s/ Paul J. Wendorff
                                               ---------------------------
                                                    Paul J. Wendorff
                                               Its Chief Executive Officer

Dated: August 14, 1996                      By   /s/ Wesley W. Winnekins
                                               ---------------------------
                                                    Wesley W. Winnekins
                                               Its Chief Financial Officer

                                          11

                                    EXHIBIT INDEX

   Exhibit
    No.       Description                                                                Page No.
   -------    ----------------------------------------------------------------------     --------
                                                                                   
     10.1     Equipment Lease between Reality Interactive, Inc. and Dexxon Capital
              Corporation  Dated June 3, 1996.......................................

     27.1     Financial Data Schedules..............................................

     99.1     Cautionary Statement..................................................          14

                                          12

                                                ACCOUNT NUMBER    20219
                                                              ------------------
                                                LEASE NUMBER         01
                                                            --------------------
LESSOR:  DEXXON CAPITAL CORPORATION
       -------------------------------------------------------------------------
ADDRESS:  6133 Blue Circle Drive, Minnetonka, MN 55343
       -------------------------------------------------------------------------
LESSEE:  REALITY INTERACTIVE, INC.
        ------------------------------------------------------------------------
ADDRESS:  11200 West 78th Street, Suite 300, Eden Prairie, MN 55344
        ------------------------------------------------------------------------
    1.  Lessor hereby leases to Lessee and Lessee hereby leases from Lessor,
        the equipment set forth herein below, upon the terms and conditions
        hereinafter set forth.
    2.  The equipment leased hereunder is as follows:

- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
  QTY.             DESCRIPTION              MODEL #                  SERIAL #
- --------------------------------------------------------------------------------
              See Attached Schedule "A"

- --------------------------------------------------------------------------------
Equipment Location if other than above address:
- --------------------------------------------------------------------------------
    3.  Lessee shall pay Lessor at the office of Lessor or at such other place
        as Lessor may hereafter designate the following rental payments, plus
        applicable taxes commencing June 3, 1996 and on the same day of each and
        every consecutive payment period thereafter in accordance with the
        following schedule:

- ---------------------------------------------------------------------------------------------------------------------------
  INITIAL TERM
   OF LEASE                            RENTAL PAYMENT AMOUNT                            RENTAL PAYMENT SCHEDULE
- ---------------------------------------------------------------------------------------------------------------------------
                                                                            
     24            Mo     Rental Payment $12,701.02   Alternate Payment Amounts      The first   one and last   one
- ------------    --------                  ---------                                           -------         -------------
   (Months)                                                                           payment(s) in the amount of 

     24                   Rental Tax     $                                            $25,402.04 being payable
- ------------    --------                  ----------                                  at the time of signing this agreement
(Number of Payments)                    (subject to change)                           with    22   remaining payments.
                                                                                          ---------
Rent Payable    --------   Credit or A&H  $                                           Security Deposit of  n/a   
    X   Monthly            Insurance       -----------                                                   ------------------
- --------                                                                              due at time of closing.

        Other   TOTAL Mo   PAYMENT       $12,701.02
- --------              ------               ------------

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

    4.   LESSEE ACKNOWLEDGES THAT LESSOR IS NOT THE MANUFACTURER OF THE
         EQUIPMENT.  NOR MANUFACTURER'S AGENT, AND LESSEE REPRESENTS THAT
         LESSEE HAS SELECTED THE EQUIPMENT LEASED HEREUNDER BASED UPON LESSEE'S
         JUDGEMENT PRIOR TO HAVING REQUESTED LESSOR TO PURCHASE THE SAME FOR
         LEASING TO LESSEE, AND LESSEE AGREES THAT THE EQUIPMENT LEASED
         HEREUNDER IS OF A DESIGN, SIZE, FITNESS AND CAPACITY SELECTED BY
         LESSEE AND THAT LESSEE IS SATISFIED THAT THE SAME IS SUITABLE AND FIT
         FOR ITS INTENDED PURPOSES.  LESSEE FURTHER AGREES THAT LESSOR HAS MADE
         AND MAKES NO REPRESENTATION OR WARRANTIES OF WHATSOEVER NATURE,
         DIRECTLY OR INDIRECTLY, EXPRESSED OR IMPLIED, INCLUDING BUT NOT
         LIMITED TO ANY REPRESENTATIONS OR WARRANTIES WITH RESPECT TO
         SUITABILITY, DURABILITY, FITNESS FOR USE AND MERCHANTABILITY OR ANY
         SUCH EQUIPMENT, THE PURPOSES AND USES OF THE LESSEE OR OTHERWISE.
         LESSEE SPECIFICALLY WAIVES ALL RIGHTS TO MAKE CLAIM AGAINST LESSOR
         HEREIN FOR BREACH OF ANY WARRANTY OF ANY KIND WHATSOEVER AND LESSOR
         HEREBY PASSES TO LESSEE ALL WARRANTIES, IF ANY, RECEIVED BY LESSOR BY
         VIRTUE OF ITS OWNERSHIP OF THE EQUIPMENT.  LESSOR SHALL NOT BE LIABLE
         TO LESSEE FOR ANY LOSS, DAMAGE OR EXPENSE OF ANY KIND OR NATURE CAUSED
         DIRECTLY OR INDIRECTLY BY ANY EQUIPMENT LEASED HEREUNDER OR FOR THE
         USE OR MAINTENANCE THEREOF, OR FOR THE FAILURE OF OPERATIONS THEREOF,
         OR FOR THE REPAIRS, SERVICE, OR ADJUSTMENT THERETO, OR BY ANY DELAY OR
         FAILURE TO PROVIDE ANY THEREOF, OR BY AN INTERRUPTION OF SERVICE OR
         LOSS OF USE THEREOF OR FOR ANY LOSS OF BUSINESS OR ANY OTHER DAMAGE
         WHATSOEVER AND HOWSOEVER CAUSED, NO DEFECT OR UNFITNESS OF THE
         EQUIPMENT SHALL RELIEVE LESSEE OF THE OBLIGATION TO PAY RENT, OR ANY
         OTHER OBLIGATION UNDER THIS AGREEMENT TO LESSOR. (Continued on reverse
         side hereof)

    This Lease Agreement consisting of the foregoing AND THE REVERSE SIDE
HEREOF, correctly sets forth the entire Agreement between Lessor and Lessee.  No
agreements or understanding shall be binding on either of the parties hereto
unless specifically set forth in this Agreement.  The term "Lessee" as used
herein shall mean and include any and all Lessees who sign hereunder, each of
whom shall be jointly and severally bound thereby.

             THIS IS A NON-CANCELLABLE LEASE FOR THE TERM INDICATED ABOVE
                                  Date Signed    June 3, 1996
                                             ----------------------------------
                                  Name of Lessee  Reality Interactive, Inc.
                                                 ------------------------------
                                                      (Full Legal Name)
ACCEPTED THIS  3rd  DAY OF   June , 1996    THE UNDERSIGNED AFFIRMS THAT HE IS
             ------        -------    --        A DULY AUTHORIZED CORPORATE
LESSOR:  Dexxon Capital Corporation         OFFICER, PARTNER OR PROPRIETOR OF
        ----------------------------             THE ABOVE NAMED LESSEE

BY:  /s/ Christopher H. Duncan  PRES  BY: /s/ Wesley W. Winnekins  CFO/Secretary
   ---------------------------------      --------------------------------------
         (Authorized Signature)                                          (title)

(Continued from reverse side hereof)
    5.   The equipment is and at all times shall remain the sole and exclusive
    personal property of Lessor. No right, title or interest in the equipment
    shall pass to Lessee other than the right to maintain possession and use of
    the equipment for the full lease term, conditioned upon Lessee's compliance
    with the terms and conditions of this Agreement.  Plates or markings may be
    affixed to or placed on the equipment indicating ownership.

    6.   Lessee, at Lessee's own cost and expense, shall keep the equipment in
    good repair, condition and working order and shall furnish all parts,
    mechanisms, devices and servicing required therefore and shall not
    materially alter the equipment without the consent of Lessor.

    7.   Lessee hereby assumes and shall bear the entire risk of loss for
    theft, loss, damage, or destruction of the equipment, from any and every
    cause whatsoever.  No such loss or damage shall impair any obligation of
    Lessee under this Agreement which shall continue in full force and effect.
    In the event of such loss or damage and irrespective of, but applying full
    credit for payment from any insurance coverage, Lessee shall, at its own
    cost and expense at the option of Lessor: (a) place the same in good
    repair, condition and working order; or (b) replace the same with similar
    equipment of equal value; or (c) pay all sums due and owing under this
    Agreement, computed from the date of such loss or damage, in which case
    this Agreement shall terminate, except for Lessee's duties under paragraph
    9, as of the date such payment is received by Lessor.

    8.   Lessee shall comply with all laws, regulations and orders relating to
    this Agreement and the use, operation or maintenance of the equipment.

    9.   Lessee shall indemnify Lessor against and hold Lessor harmless from
    any and all claims, actions, suits or proceedings, including all costs,
    expenses, damages, attorney's fees or other liabilities arising out of,
    connected with or resulting from, including without limitation the
    selection, delivery, possession, use, operation or return of the equipment.

    10.  Lessee shall not sell, assign, sublet, pledge, mortgage, hypothecate
    or otherwise encumber or suffer a lien upon or against any interest in this
    Agreement or the equipment or remove the equipment from the place of
    installation set forth herein, unless Lessee obtains the written consent of
    Lessor which consent shall not be unreasonably withheld.

    11.  Lessee shall pay directly, or to Lessor, all license fees,
    registration fees, assessments and taxes which may not or hereafter be
    imposed upon the ownership, sale (if authorized), possession or use of the
    equipment, excepting only those based on Lessor's income, and shall keep
    the equipment free and clear of all levies, liens or encumbrances arising
    therefrom.  All required personal property tax returns relating to the
    equipment shall be filed by Lessee unless otherwise provided in writing.
    If Lessee fails to pay any said fees, assessments or taxes, Lessor shall
    have the right, but not the obligation, to pay the same and such amount,
    including penalties and costs, shall be repayable to Lessor with the next
    installment of rent and if not so paid shall be the same as failure to 
    pay any installment of rent due hereunder.  Lessor shall not be responsible
    for contesting any valuation of or tax imposed on the equipment but may do
    so strictly as an accommodation to Lessee and shall not be liable or
    accountable to Lessee therefore.

    12.  Time is of the essence in this Agreement and no waiver by Lessor of
    any breach or default shall constitute a waiver of any additional or
    subsequent breach or default by Lessor nor shall it be a waiver of any of
    Lessor's rights.  If any rental payment shall be unpaid for more than ten
    (10) days after the due date thereof, or if any other sum due and owing
    under this Agreement shall remain unpaid for more than ten (10) days.
    Lessor shall have the right to add and collect a reasonable late charge of
    ten percent (10%) or a lesser amount if established by any state or federal
    statute applicable thereto, plus interest at the maximum rate permitted by
    law together with any other expenses necessarily incurred by reason of such
    nonpayment and Lessor may exercise any one or more of the remedies set
    forth in paragraph 14.

    13.  Neither this Agreement nor any interest in the equipment is assignable
    or transferable by operation of the law.  If any proceeding under the
    Bankruptcy Act, as amended, is commenced by or against Lessee, if Lessee if
    adjudged insolvent, if Lessee makes any assignment for the benefit of
    creditors, if any receiver is appointed with power to take possession of
    the equipment or affect Lessor's rights under this Agreement, or a writ of
    attachment or execution if levied on the equipment and not released or
    satisfied within ten (10) days thereafter, this Agreement shall immediately
    terminate, unless Lessor gives written notice otherwise, and the equipment
    or this Agreement shall not be treated as an asset of Lessee and Lessor may
    exercise any one more of the remedies set forth in paragraph 14 for any
    damages occasioned thereby.

    14.  If Lessee with regard to any item or items of equipment fails to pay
    any rent or other amount herein provided with ten (10) days after the same
    is due and payable, or if Lessee with regard to any item or items of
    equipment fails to observe, keep or perform any other provision of this
    Agreement required to be observed, kept or performed by Lessee, Lessor
    shall have the right to exercise any one or more of the following remedies:
    (a) to declare the entire amount of rent hereunder immediately due and
    payable as to any or all items of equipment, without notice or demand to
    Lessee; (b) to sue for and recover all rents, and other payments, then
    accrued or thereafter accuring, with respect to any or all items of
    equipment; (c) to peaceably take possession of any or all items of
    equipment without demand or notice, wherever same may be located, without
    any court order or other process of law and Lessee hereby waives any and
    all damages occasioned by such taking of possession and any said taking of
    possession shall not constitute a termination of this Agreement as to any
    or all items of equipment unless Lessor expressly so notifies Lessee in
    writing; (d) to terminate this Agreement as to any or all items of
    equipment; (e) to pursue any other remedy of law or in equity.  Lessee
    shall pay all costs and attorney's fees incurred in collecting or
    attempting to collect any sums owed under this lease or in securing
    possession of property and costs of reconditioning the property.

    15.  Lessee shall keep the equipment insured against all risks of loss or
    damage from every cause whatsoever for not less than the original purchase
    price of the equipment without consideration for depreciation and shall
    carry public liability insurance, both personal injury and property
    damage covering the equipment and Lessee shall be liable for all deductible
    portions of all required insurance.  All said insurance shall be in form
    and amount and with companies satisfactory to Lessor.  All insurance for
    loss or damage shall provide that losses, if any, shall be payable to
    Lessor, and all such liability insurance shall be in the join names of
    Lessor and Lessee. Lessee shall pay the premiums therefor and deliver to
    Lessor the policies of insurance or duplicates thereof, or other evidence
    satisfactory to Lessor of such insurance coverage.  Each insurer shall agree
    by endorsement upon the policy or policies issued by it or by independent
    instrument furnished to Lessor, that it will give Lessor ten (10) days
    written notice prior to the effective date of any alteration or
    cancellation of such policy.  The proceeds of such insurance payable as a
    result of loss of or damage to the equipment shall be applied, at the
    option of Lessor, as set out in Paragraph 7.  Lessee hereby irrevocably
    appoints Lessor as Lessee's attorney-in-fact to make claim for, receive
    payment of, and execute and endorse all documents, checks or drafts received
    in payment for loss or damage under any said insurance policies.  In case of
    the failure of Lessee to procure or maintain said insurance or to comply
    with any other provision of this Agreement, Lessor shall have the right but
    shall not be obligated, to effect such insurance or compliance on behalf of
    Lessee.  In that event, all moneys spent by and expenses of Lessor in
    effecting such insurance or compliance shall be deemed to be additional
    rent, and shall be paid by Lessee to Lessor with the next monthly payment
    of rent.

    16.  For the purpose of this Agreement, any notices and demands required to
    be given shall be given to the parties in writing and by regular mail at
    the address herein set forth, or to such other address as the parties may
    hereafter substitute by written notice.

    17.  This Agreement cannot be cancelled or terminated by Lessee except for
    nonperformance by Lessor.  Lessor shall be deemed to have fully performed
    at the time the equipment is delivered to and accepted by Lessee.

    18.  Upon expiration of the lease term, Lessee will immediately return the
    equipment in as good a condition as received, less normal wear, tear and
    depreciation, to Lessor's branch office which is nearest to the place of
    installation or to such other reasonable place as is designated by Lessor.
    The equipment shall be carefully crated, shipped freight prepaid and
    properly insured.

    19.  It is understood that Lessor contemplates assigning this lease, and
    that said assignee may assign the same.  All rights of Lessor in the
    equipment and hereunder may be assigned, pledged, mortgaged, transferred,
    or otherwise disposed of, either in whole or in part, without notice to
    Lessee.  The assignee's rights shall be free from all defenses, set-offs or
    counterclaims which Lessee may be entitled to assert against Lessor.  No
    such assignee shall be obligated to perform any duty, covenant or condition
    required to be performed by Lessor under the terms of this lease.

    20.  This agreement shall be interpreted and governed by the laws of the
         state of Minnesota.

                              DEXXON CAPITAL CORPORATION
                                     SCHEDULE "A"

                                                      Page 1 of 5

Schedule attached and made part of that Equipment Lease/Promissory Note/Security
Agreement dated the 3rd day of June, 1996 between the undersigned Lessee/Debtor
and Dexxon Capital Corporation.

- --------------------------------------------------------------------------------
Qty      Description                   Model #             Serial #
- --------------------------------------------------------------------------------

1        Apple Power MAC               7500/100            APL-M3102LL/A
1        Apple Power MAC               16/1000

1        Apple Multi Scan 15" Display                      APL-M3089LL/A
1        NEC-XV17 17" Multisync Monitor                    NEC-JCI734VMA
1        3COM Fast Etherlink           10/100BT BCI        3CO-3595-TX-5Pk
2        3CO Linkbuilder TP            12Port 10BT         3CO-3CI6170
1        HP Deskjet 340 Inkjet Printer                     H-P C2655A
1        H-P Infared Adapter for H-P 340                   H-P# C3277A

2        Adobe Photoshop V3.0.1                            ADO-0110-3061
1        HP Deskjet 340 color kit                          H-P -C3280A
10       Level 5 Patch Cable           3 ft' Yellow        CAB-HPETP-38-2
1        Iomega Zip MAC Format         100MB 3PK DIE       IOM-10019
1        Sony MAC View LX Adapter                          SON-MACVIEWLX
5        Level 5 Patch Cab             7 ft.               CAB-HPETP-79
2        ASANTE Friendlynet PB 500 10BT                    ASA 99-00168-01
1        Simple Apple                  9500 16MB           SIT-STA-9500
1        Simple Apple                  32 MB 9500          SIT-STA9500/32

1        IOMEGA ZIP 100MB SCSI DR/PC                       IOM-10011
1        Quark MAC Powermac Xpress     V3.32               QRK-HXPUS332259
9        MS office STD WIN 95 Full Prod CDR                MIC-021-056V700

1        MS Word for MAC               V6.01               MIC-034-096V601
3        USR Sportster 28.8 V.34 EXT FAX                   USR-000839-00
1        MS Mac Office V.4.21 CDR                          MIC-021-088V421
3        At 6ft SER 9f/25m CAB                             CAB-ATMDDEM
2        Apple Design KB II                                APL-M289LL/A
11       Durina Winfax                 Pro V7 CDR          DKL 10-20011067000
1        AESP Level 5 Patch CAB                            CAB-C-TR345M-15

4        3COM Etherlink III ENET TP & 28.8                 3CO-3C562-TP
1        Ascend Pipeline 25 W/NT-1                         ASE-P25-1UBRI-4

1        Ascend Pipeline 50SYS ISDEN BRI U                 ASE-P50-1UBRI

1        BOCA Io BD 4 Serv 32 Par                          BOC-IO2BY4
1        Simple CPQDeskpro XL 64MB                         SIT-STCXL/64
3        TOS 400CDS                    400DT-LI-ion BAT    TOS-PA24887UR
1        Simple 8MB                    TOS T400 T410 EDO   SIT-STT400/8T

                                                      PAGE 2 OF 5

1        Quark Mac Powermac            Express V3.32       QRK-HXPUS332259
1        Adobe Mac Pagemill V1.0                           ADO-1770-0001
1        Simple 8MB TOS                T400 T410 EDO       SIT-STT400/8T

1        ADOBE Illustrator             V6.5                ADO-0150-2096
1        MS MAC Office                 V4.21 3.5           MIC-021-096V421
1        Adobe Photoshop               V3.0.1 Powermac     ADO-0110-3061
1        Sony Mac view LX Adapter                          SON-Macviewlx
1        Simple 32MB                   Apple 9500          SIT-STA9500/32
1        NEC XV17 17"                  Multisync Monitor   NEC-JC1734VMA
1        Apple Power Mac               7500/100 16/1000CD  APL-M3102LL/A
1        Quark Mac Express             V3.32               QRK-HXPUS332259
1        Adobe Maq Page                V1.0                ADO 1770-0001

1        Apple Design                  KB 11               APL-M289LL/A

1        MS Office                     V4.21 MAC CD        MIC-021-088V421

2        DIMM                          2 x 64-70 (16m)     OKI8/CBS
4        4x32-70 (8) 2k                                    OKI8/OKI

2        Apple Design                  KB 11               APL-M2891II/A
1        Simple 8MB TOS                T400 T410 EDO       SIT-STT400/8T
2        Apple Power Mac               7500/100 16/1000    APL-M3102LL/A
3        Apple Multi Scan              15" Display         APL-M3089LL/A
1        NEC XV17 + 17" MON                                NEC-JC1734VMA-1
1        EPS Es1200C Scanner           Mac W/INT           EPS-B027021-PROMAC

1        EPS ESI 1200C Scanner         MAC W/INT           EPS-BO27021 PROMAC
1        NEC XV17 + 17" MON                                NEC-JC1734VMA-1

4        9080MB Seagate Wide SCSI Bare KIT                 SB800610
         9080MB Seagate Wide SCSI2F                        SB812622
                                                           SB809292
                                                           SB812773

1        Adaptec 394OW WIDE            SCSI2 PCI       ADA-AHA-3940WKIT

2        Power Mac                     7500/100 16/1000 CDR  APL-M3102LL/A
1        3 CO Linkswitch 1000                              3CO-316900
1        3COM 3c562 Modem cable
2        Apple Multi Scan 15" display                      APL-M3089LL/A
1        Simple 8 MB Apple 9500                            SIT-StA9500/8

3        Apple Design KB 11                                APL-M289LL/A

2        Simple 16MB Apple 9500                            SIT-STA950/16
3        Simple 8MB Apple 9500                             SIT-STA9500/8
1        Power Mac 7500/100 16/1000                        APL-M3102LL/A
1        NEC XV17 + 17" Mon                                NEC-JC1734VMA-1
1        3COM Linkbuilder TP 12 Port 10BT                  3CO-3C16170
         3COM 3c562 Modem Cable
2        Apple Multi Scan 15" display                      APLM3089LL/A

                                                      PAGE 3 OF 5

1        3CO Linkswitch 1000                                3CO-3CI6900

1        HP                            7050 P100 8/1.2m    U55420396
1        HP                            7050 P100 8/1.2m    U554101709
1        HP                            7050 P100 8/1.2m    U554101474
1        Tare Notepac Compute
1        CMPQ 1501                     15" .28NI           534BC05JCI80
1        CMPQ 1501                     15" .28NI           540BC06JB987
1        CMPQ 1501                     15" .28NI           540BC06JB995
6        CMPD Simm                     1x32 MB

1        Simple 64 MB CPQ Desktop XL   (2 modules)         SIT-STCXL/64
1        Apple Multi Scan 15in Display                     APL-M3089LL/A
1        Simple 8MB Apple 9500                             SIT-STA9500/8
         3com 3c562 modem cable
         3co Linkswitch 1000           13.0                3co-3c16900

1        UTL/SS After Dark                                 76-11449
1        BP/DPUB Publisher                                 59-10474
1        Premium IBM Parall                                10-10145
1        Toner    f/5L                                     91-10154
1        Laserjet 5L                                       36-10492

1        3CO Linkswitch 1000           13.0                3CO-3CI6900
0        3com 3c562 modem cable

1        New It
2        Apple Multi Scan 15in  DISF                       SCJ544CC39X
1        3COM Linkswitch 1000                              055859

1        NEC XV17 + 17in MON                               NEC-JC1734VMA-1

14       TOS 410CDT 5/90 810MB CT Dual                     TOS-PA1215U-T2C

2        Adobe Photoshop V.3.0.5 Powermac                  ADO-0110-3061
3        Simple 32MB Apple 9500                            SIT-STA9500/32
3        Apple Power Mac 7500/100 16/1000                  APL-M3102LL/A
1        Apple Multi Scan 15in Display                     APL-M3089LL/A
3        Apple Design KB 11                                APL-M2891LL/A
2        NEC XV17 + 17in MON                               NEC-JC1734VMA-1
1        Radius Videovision Telecast Upgrade

3        Apple Design KB 11                                APL-M2891LL/A
2        NEC XV17 + 17in MON                               NEC-JC1734VMA-1
1        RAdius Videovision Telecast Upgrade

1        MS Office V4.21 MAC CDR                           MIC-021-088V421
1        Apple Design KB 11                                APL-M2891LL/A
2        Simple 16 MB Apple 9500                           SIT-STA9500/16
1        Power Mac 7500/100 16/1000                        APL-M3102LL/A
1        Apple Multi Scan 15in Display                     APL-M3089LL/A

1        CMPQ 1510 15" .28NI
1        CMPQ 7222 P100 8/1.2

                                                      PAGE 4 OF 5

1        EK Windows 95 for DU
3        BK Windows 95 For DU

1        Annex Terminal Server                             00802D0117F9

1        10' Mirage/cases- Coal Fabric
1        300 Watt Backlit Light Package
1        300 Watt Backlit Package for GPS Panel
1        Backlit Header
3        30"x30" GPS Panels - 86
3        15"x20" GPS Panels
1        Dark Green Vinyl Panel 78.5"x10"
1        Dark Green, Gold Metallic Copy Panel
1        Set of 3 Vinyl Strips 2"x9"

2        Compac 15" monitors 1510
2        Compac 7222

1        duracell AA 4pk
1        CASQV10A                                          000-1601

2        NEC 17xv + Monitor Cases 3/8th"
1        CPU, Keyboard Access Comp case
1        2 in 1 Yamaha Speaker Case

1        12 Panel Mosiak Back Wall System
1        Hard Shipping Cases/Wheels
1        Courier

2        3COM Etherlink 111 TP & 28.8 5pk                  3CO-3C562-TP-5PK

1        Simple 32MB HP Vectra VL2 5/60                    SIT-STH32000/586
1        Netserver HP 5/1000 32MB NO HDD

1        Sun Spar C station 5 ... includes                 S5M-110-32-P46
         110 MHZ CPU & Chassis
         19" monitor Monochrome
         Mono Frame Buffer
         32-Mbytes RAM
         1.05- GBYTE internal SCSI Hard Drive
         Keyboard, MOuse, Pad

1        Solaris 25 on CD with Docs and License

1        Richoh 3700 fax                                   M1360101211

1        NEC XV17 + 17in Mon                               NEC-JC1734VMA-1

1        3Com Etherlink 111 TP & 28.8 5PK                  3CO-3C562-TP-5PK
1        3COM Etherlink 111B TPO Enet 10BT 5               3CO-3C509B-TPO-5pk

3        TOS 400CDS 400CDT LI-ION BAT                      TOS-PA2487UR

1        Radius Videovision Telecast UPGD 1                RAD-0464

                                                       PAGE 5 OF 5

1        Apple Design KB 11                                APL-M2891LL/A
1        Simple 16MB Apple 9500                            SIT-STA9500/16
13       Simple 8MB TOS T400 T410 EDO                      APL-M281LL/A
11       MS Office STD Win 95 Full Prod 3.5                MIC-021-054V700
12       Symantec Winfax Pro V7.0 CDR 12                   SYM-12-00-01529
6        MS Win 95 UPG CDR                                 MIC-050-052-950
1        HP Netserver LC 5/100 32MB NO HDD                 HWP-D3594-A

1        Simple 32MB HP Vectra VL2 5/60                    SIT-STH32000/586

1        Novell NW NFS SVCS V2.1 for NW V4.1               NOV-00662644052526

4        429MB Seagate WIDE SCSI Bare                      K7527801
                                                           K7625835
                                                           K7619326
                                                           K7629563

1        AW 3.0 Mac Commercial 5 seat site                 APM30-5-SE
         license (w/studio bundle)
1        AW 3.0 Win Commercial 5-seat site
         license (w/Studio Bundle)
3        APM30 upgrade                                     APM 0022-2071-3083
                                                           APM 8079-2072-3084
                                                           APM 3084-6072-3084
1        APW 3.0 Upgrade                                   APW 2255-4078-4089

1        DYN Wind Renew Enhance Program
1        DYN Wind 5-Pack 1-hr client SU
11       MS Office STD Win 95 Full Prod                    MIC-021-054V700
12       Symantec Winfax PRO V7.0 CDR                      SYM-12-00-1529
6        MS Win 95 UPG CDR                                 MIC-050-052-950
1        HP Netserver LC 5/100 32MB NO HDD                 HWP-D3594A
1        Simple 32MB HP Vectra VL2 5/60                    SIT-STH32000/586
1        Novell NW NFS SVCS V2.1 for NW V4.1               NOV-00662644052526

1        AW 3.0 MAC Commercial                             20030-0550-182-25036

1        Novell NW NFS SVCS V2.1 for NW V4.1               NOV-00662644052526
1        HP Netserver 5/100 32MB HP Vectra VL2 5/60        HWP-D3594A
1        Simple 32MB HP Vectra VL2 5/60                    SIT-STH32000/586

1        Mitel Digital DN Line Card 12 Circuits            1CDMI141
2        Mitel superset 420 telephone                      1LANAO16
1        Mitel Superset 420 telephone                      1PHMIOO8
         All equipment now owned or hereinafter acquired.

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

This schedule is hereby verified as correct by the Undersigned Lessee/Debtor who
acknowledges receipt thereof.

                                  LESSEE/DEBTOR:  REALITY INTERACTIVE, INC.
                                  By: /s/ Wesley W. Winnekins
                                     ------------------------------------------
                                  Title:  CF0/Secretary
                                        ---------------------------------------

- --------------------------------
DEXXON CAPITAL CORPORATION

                                ACCEPTANCE CERTIFICATE

TO:      Dexxon Capital Corporation
         6975 Washington Ave. South
         Minneapolis, MN 55439(Lessor)

FROM:    Reality Interactive, Inc.
         11200 West 78th Street
         Eden Prairie, MN 55344

RE:

         We hereby certify that we have satisfactorily received, inspected and
installed all the equipment referred to in Schedule # 01 to the Master Equipment
Lease Agreement #20219 dated June 3, 1996 between you and us.  The subject
equipment is accepted as Equipment Leased under the terms and conditions of
these agreements.  We understand that this acceptance may not be cancelled or
revoked.

         Per Section #3 of the Master Equipment Lease, Lessee grants Lessor the
right to insert the respective commencement and termination dates upon the face
of the subject Schedule.

Acceptance Date:   June 3, 1996      LESSEE'S NAME:  Reality Interactive, Inc.
                  --------------
                                       By: /s/ Wesley W. Winnekins
                                           -------------------------------------

                                            Its  CFO/Secretary
                                                 ------------------------------

REFERENCE VENDOR INVOICE:

                                    LEASE ADDENDUM

Whereas, DEXXON CAPITAL CORPORATION, doing business in the state of Minnesota,
known as Lessor in that certain lease agreement with Reality Interactive, Inc.
of the United States of America with principal offices at Eden Prairie, MN known
as Lessee in said Lease Agreement # 20219-01 entered in concurrently dated June
3, 1996 has thereby rented and leased to Lessee the personal property referred
to as "equipment" as more fully described and identified below.

Now for and in consideration of said Lease, Lessor hereby gives and grants to
Lessee the exclusive right and option to purchase said equipment after the term
of said Lease, or an extension thereof, upon the following terms and conditions:

         1.   The purchase option for said equipment shall be its' Fair Market
              Value.  Fair Market Value shall be determined by reasonable
              appraisal provided by Lessee through a knowledgeable third party
              independent of Lessee.
         2.   Lessee shall have paid all installments of rent due and shall
              have performed all other conditions and covenants of said Lease
              prior to the exercise of this option.
         3.   This option may be exercised by Lessee by giving written notice 
              to Lessor of such exercise along with the equipment appraisal and 
              shall be accompanied by payment in full of the purchase price 
              specified.
         4.   This option shall apply to, inure to the benefit of, and be
              binding upon the heirs, executors, administrators, successors, or
              assigns of the respective parties hereto.
         5.   An extension of the lease term may be granted by Lessor based on
              the equipments' Fair Market Value.

DESCRIPTION OF LEASED EQUIPMENT:

              See Attached Schedule "A"

Dated at Minneapolis, MN this 3rd day of June, 1996.

                                       DEXXON CAPITAL CORPORATION

                                       By:  /s/ Christopher H. Duncan
                                          --------------------------------
                                       Title:   PRES.
                                             -----------------------------

- --------------------------------
DEXXON CAPITAL CORPORATION

                     CERTIFICATE REGARDING CORPORATE RESOLUTIONS

Lessee's Full Name and Address:

 Reality Interactive, Inc.
- --------------------------
 11200 West 78th Street
- --------------------------
 Eden Prairie, MN 55344
- --------------------------

    I hereby certify to Dexxon Capital Corporation and its successors, assign
and participants that I am the duly elected and acting Secretary of the above
named Lessee and I further certify that:

    1.   The Lessee's principal place of business is at the address set forth
         above.

    2.   The following resolution has been duly adopted by the Lessee's Board
         of Directors and is in full force and effect without limitation.

    RESOLVED, that either of president or Chief Financial Officer are hereby
    authorized for and on behalf of the corporation to execute and deliver to
    Dexxon Capital Corporation all such lease agreements, loan agreements, and
    other agreements as he may in his discretion approve, his signature to be
    conclusive evidence of his approval;

    RESOLVED FURTHER, that the signatory or each of signatories named above 
    and any other officer or authorized representative of the corporation are 
    hereby individually authorized and on behalf of the corporation to take 
    such further actions or sign such other documents or agreements as he in 
    his discretion deems appropriate to consummate, supplement, amend or 
    complete the transactions provided for or permitted under the lease 
    agreements, loan agreements or other agreements referred to in the 
    foregoing resolution, his signature or taking such action to be 
    conclusive evidence of his approval;

    RESOLVED FURTHER, that these resolutions shall not be amended or revoked
    without prior written notice to Dexxon Capital Corporation and any such
    amendment or revocation shall be effective only as to transactions
    subsequent to delivery of such notice.

    IN WITNESS WHEREOF, I have executed this Certificate as of this 3rd day of
    June, 1996.

                                                 /s/ Wesley W. Winnekins
                                                 ------------------------------
                                                 Title  Secretary
                                                      -------------------------

 5

                   3-MOS
                          DEC-31-1996
                               JUN-30-1996
                                         586,731
                                 8,049,686
                                  183,791
                                         0
                                     71,493
                             8,915,914
                                         390,356
                                 177,506
                               9,277,245
                          305,035
                                              0
                                0
                                          0
                                        46,774
                                 (8,925,436)
                 9,277,245
                                        125,298
                               125,298
                                           22,618
                                   61,363
                             1,668,335
                                     0
                             282,846
                            (1,597,629)
                                         0
                        (1,597,629)
                                       0
                                219,470
                                            0
                               (1,817,099)
                                    (.44)
                                        0

EXHIBIT 99.1

                                 CAUTIONARY STATEMENT

    Reality Interactive, Inc. (the "Company"), or persons acting on behalf of
the Company, or outside reviewers retained by the Company making statements on
behalf of the Company, or underwriters, from time to time make, in writing or
orally, "forward-looking statements" within the meaning of Section 27A of the
Securities Act of 1933, as amended, and Section 21E of the Securities Exchange
Act of 1934, as amended. When used in conjunction with an identified
forward-looking statement, this Cautionary Statement is for the purpose of
qualifying for the "safe harbor" provisions of such sections and is intended to
be a readily available written document that contains factors which could cause
results to differ materially from such forward-looking statements. These factors
are in addition to any other cautionary statements, written or oral, which may
be made or referred to in connection with any such forward-looking statement.

    The following matters, among others, may have a material adverse effect on
the business, financial condition, liquidity, results of operations or
prospects, financial or otherwise, of the Company. Reference to this Cautionary
Statement in the context of a forward-looking statement or statements shall be
deemed to be a statement that any or more of the following factors may cause
actual results to differ materially from those in such forward-looking statement
or statements:

    DEVELOPMENT STAGE COMPANY. The Company was incorporated in May 1994, first
began to ship the complete series of its initial product in August 1995, and
accordingly, has only a limited history of operations. The Company's prospects
for success must be considered in light of the problems, expenses, difficulties,
complications and delays frequently encountered in connection with the formation
and development of a new business in a competitive industry. In addition, due to
the uncertainty in growth of a development stage company and the rate of change
in the industry perceived by the Company, the Company is uncertain of the time
frame or amount of funding required to accomplish its business objectives.

    DEVELOPING MARKET; MARKET ACCEPTANCE. The market for educating and
training businesses has historically been served by consultants, instructor-led
training and training publications such as books, manuals and tapes. Currently,
there is little use of interactive multimedia education and training products by
businesses, and many of the Company's potential customers do not own or have
access to multimedia compatible equipment. The Company's future success will
depend upon, among other factors, the extent to which companies acquire
multimedia equipment compatible with the Company's products and adopt and use
interactive multimedia education and training programs. In addition, the
Company's success will depend in part on its ability to market and sell multiple
copies of its products to large corporate customers. In the event that adoption
and use of multimedia equipment compatible with the Company's products do not
become widespread, the number of potential customers of the Company will be
limited. There can be no assurance that the Company's products or the prices the
Company charges for its products will be acceptable to the market or that the
Company will be able to sell multiple copies to large corporate customers.

    LIMITED MARKETING CAPABILITY. The Company currently has a small sales and
marketing staff and limited number of strategic alliances relating to
distribution of its products. There can be no assurance that the Company will be
able to build a suitable sales force or enter into satisfactory marketing
alliances with third parties, or that its sales and marketing efforts will be
successful.

    DEPENDENCE ON DIVERSIFICATION OF PRODUCT OFFERINGS. The Company currently 
has a limited number of product offerings, and purchasers of the Company's 
products are not required to purchase additional products. Accordingly, the 
Company's products represent non-recurring revenue sources, and the success 
of the Company is dependent, in part, on its ability to develop sustained 
demand for its current products and to develop and sell additional products. 
There can be no assurance that the Company will be successful in developing and 
maintaining such demand or in developing and selling additional products.

                                          14

    DEPENDENCE ON EVOLVING INDUSTRY STANDARDS. The Company's initial product
offerings prepare businesses for adherence to worldwide management standards.
The failure of the Company to enhance its products in a timely manner to changes
in the standards, the lack of public acceptance of such standards or the delay
in introduction of or enhancement to such standards would materially adversely
affect the Company's operations.

    TECHNOLOGICAL CHANGE. The industry in which the Company competes is
characterized by rapid technological change. The introduction of products
embodying new technology can render existing products and product formats
obsolete and unmarketable. The Company's success will depend on its ability to
anticipate changes in technology and to develop and introduce new and enhanced
products in a timely manner in response to technological changes, or if products
or product enhancements by the Company do not achieve market acceptance, the
Company's business would be materially adversely affected.

    FUTURE ADDITIONAL CAPITAL REQUIREMENTS; NO ASSURANCE FUTURE CAPITAL WILL BE
AVAILABLE. If the Company is unable to generate substantial revenues from its
operations or if the Company's expenses exceed expectations, the Company will
likely require additional funds to meet its capital requirements. The Company
does not currently have available bank financing. The Company may be required to
raise additional funds through public or private financings, including equity
financings, or through collaborative arrangements. There can be no assurance
that additional financing would be available on favorable terms, or at all. If
funding is not available when needed or on acceptable terms, the Company may be
forced to curtail its operations significantly or cease operations and abandon
its business entirely.

    COMPETITION. The business education and training industry is highly
competitive. A large number of companies are currently developing interactive,
multimedia-based training, educational and instructional aids. Competitors also
include national, regional and local accounting firms engaged in industrial
consulting and instructor-led training and companies which market training tools
such as books, videos and audio tapes. Some of the Company's existing
competitors, as well as a number of potential competitors, have larger technical
staffs, more established marketing and sales organizations, and greater
financial resources than the Company. There can be no assurance the Company will
be able to compete successfully with such companies, or at all.

    FLUCTUATIONS IN OPERATING RESULTS. The Company's future operating results
may vary substantially from quarter to quarter. At its current stage of
operations, the Company's quarterly revenues and results of operations may be
materially affected by the timing of the development and market acceptance of
the Company's products. Generally, operating expenses will be higher during
periods in which product development costs are incurred and marketing efforts
are commenced. Due to these and other factors, including the general economy,
stock market conditions and announcements by the Company or its competitors, the
market price of the securities offered hereby may be highly volatile.

    DEPENDENCE ON KEY PERSONNEL; LACK OF EMPLOYMENT AND NONCOMPETITION
AGREEMENTS. The success of the Company is dependent in large part upon the
ability of the Company to attract and retain key management and operating
personnel. Qualified individuals are in high demand and are often subject to
competing offers. In the future, the Company will need to hire additional
skilled personnel in the areas of research and development, sales and marketing.
There can be no assurance that the Company will be able to attract and retain
the qualified personnel needed for its business. The Company has no employment
or noncompetition agreements with any of its management or other personnel.

    DEPENDENCE ON ABILITY TO RETAIN SUBJECT MATTER EXPERTS. The Company's
product development strategy requires the Company to retain third-party subject
matter experts to perform research and development functions by providing
accurate and informative content for the Company's products. There can be no
assurance that the Company will be able to continue to attract and retain
qualified subject matter experts required to develop new products and enhance
existing products. The inability of the Company to attract and retain such
experts could have a material adverse effect on the Company and its prospects.

                                          15

    INTELLECTUAL PROPERTY. The Company regards its multimedia products as
proprietary and relies primarily on a combination of statutory and common law
copyright, trademark and trade secret laws, customer licensing agreements,
employee and third-party nondisclosure agreements and other methods to protect
its proprietary rights. Despite these precautions, it may be possible for a
third party to copy or otherwise obtain or use the Company's products or
technology without authorization, or to develop similar products or technology
independently. If unauthorized use or copying of the Company's product were to
occur to any substantial degree, the Company's business and results of
operations could be materially adversely affected. There can be no assurance
that the Company's means of protecting its proprietary rights will be adequate
or that the Company's competitors will not independently develop similar
products.

    The Company believes that developers of multimedia products may
increasingly be subject to such claims as the number of products and competitors
in the industry grows and the functionality of such products in the industry
overlaps. Any such claim, with or without merit, could result in costly
litigation and could have a material effect on the Company.

    LACK OF PRODUCT LIABILITY INSURANCE. The Company may face a risk of
exposure to product liability claims in the event that use of its product is
alleged to have resulted in damage to its customers. The Company does not
currently carry product liability insurance. There can be no assurance that such
insurance will be available on commercially reasonable terms, or at all, or that
such insurance, even if obtained, would adequately cover any product liability
claim. A product liability or other claim with respect to uninsured liabilities
or in excess of insured liabilities could have a material adverse effect on the
business and prospects of the Company.

                                          16