U.S. SECURITIES AND EXCHANGE COMMISSION
WASHINGTON D.C. 20549
FORM 10-QSB/A
(Mark One)
[X} QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT
OF 1934 FOR THE QUARTERLY PERIOD ENDED DECEMBER 31, 1999
OR
[ ] TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE EXCHANGE ACT
Commission file number 0 - 26013
MULTI-LINK TELECOMMUNICATIONS, INC.
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(Exact name of small business issuer as specified in its charter)
Colorado 84-1334687
------------------------------ -------------------------------
(State or other jurisdiction of (IRS Employer Identification No.)
incorporation or organization)
4704 Harlan St, Suite 420, Denver, Colorado, 80212
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(Address of principal executive offices)
(303) 831 1977
-------------------------
(Issuer's telephone number)
Check whether the issuer: (1) filed all reports required to be filed by Section
13 or 15(d) of the Exchange Act during the past 12 months (or for such shorter
period that the registrant was required to file such reports), and (2) has been
subject to such filing requirements for the past 90 days. Yes [X] No [ ]
State the number of shares outstanding of each of the issuer's classes of
equity, as of the latest practicable date:
Class Outstanding February 14, 2000
- -------------------------- ---------------------------
Common Stock, No par value 3,519,020 shares
Transitional Small Business Disclosure format: Yes [ ] No [X]
<PAGE>
INDEX
MULTI-LINK TELECOMMUNICATIONS, INC. AND SUBSIDIARIES
PART I - FINANCIAL INFORMATION
Item 1. Financial Statements (Unaudited) PAGE
Consolidated Balance Sheets,
December 31, 1999 and September 30, 1999 3
Consolidated Statements of Operations - Three Months Ended 4
December 31, 1999 and 1998
Consolidated Statement of Cash Flows - Three months Ended 5
December 31, 1999 and 1998
Notes to Consolidated Financial Statements 6
Item 2. Management's Discussion and Analysis of Financial
Condition and Results of Operations 8
PART II - OTHER INFORMATION
Item 1. Legal Proceedings 12
Item 2. Changes in Securities and Use of Proceeds 12
Item 3. Defaults upon Senior Securities 12
Item 4. Submission of Matters to a Vote of Security Holders 12
Item 5. Other Information 12
Item 6. Exhibits and Reports on Form 8-K 13
2
<PAGE>
Part I. FINANCIAL INFORMATION
Item 1. Financial Statements
<TABLE>
<CAPTION>
Multi-link Telecommunications, Inc.
Consolidated Balance Sheets
December 31, September 30,
1999 1999
------------ -------------
ASSETS
<S> <C> <C>
Current Assets
Cash & Cash Equivalents .......................................... $ 925,804 $ 512,617
Marketable Securities, current ................................... 2,112,366 3,397,002
Accounts Receivable, net of allowance
for doubtful accounts of $98,621 and $33,215, respectively .... 847,754 265,419
Note Receivable .................................................. 304,537 0
Inventory ........................................................ 23,109 0
Prepaid expenses ................................................. 147,445 51,234
----------- -----------
Total Current Assets ...................................... 4,361,015 4,226,272
Marketable Securities ................................................... 0 386,357
Property & Equipment Net ................................................ 2,774,401 1,184,653
Other Assets
Deferred Financing Costs ......................................... 47,609 159,430
Intangible Assets, net of amortization of
$676,198 and $547,215, respectively ............................ 4,305,037 715,882
----------- -----------
TOTAL ASSETS ............................................................ $11,488,062 $ 6,672,594
=========== ===========
LIABILITIES & STOCKHOLDERS' EQUITY
Current Liabilities
Accounts Payable ................................................. $ 845,902 $ 117,373
Accrued Expenses ................................................. 519,903 50,647
Deferred Revenue ................................................. 358,478 164,091
Notes Payable - Related Parties, Current Portion ................. 15,301 17,569
Notes Payable and Current Portion of Long -Term Debt ............. 383,162 160,424
----------- -----------
Total Current Liabilities ................................. 2,122,746 510,104
Long-Term Debt, Net of Current Portion .................................. 2,342,311 341,011
STOCKHOLDERS' EQUITY
Preferred Stock, $.01 par value: 5,000,000 shares
authorized: none issued ........................................ 0 0
Common Stock no par value; 20,000,000 shares
authorized, 3,272,302 and 3,122,302 shares
issued and outstanding, respectively ........................... 8,688,402 7,722,778
Loss on Investments available for sale ........................... (7,001) (11,312)
Accumulated Deficit .............................................. (1,658,396) (1,889,987)
----------- -----------
Total Stockholders' Equity ................................ 7,023,005 5,821,479
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY .............................. $11,488,062 $ 6,672,594
=========== ===========
</TABLE>
See accompanying Notes to Consolidated Financial Statements.
3
<PAGE>
<TABLE>
<CAPTION>
Multi-link Telecommunications, Inc.
Consolidated Statements of Operations
Three Months Ended
December 31, December 31,
1999 1998
------------ -------------
<S> <C> <C>
NET REVENUES .......................................... $ 1,504,001 512,714
COST OF SERVICES AND PRODUCTS ......................... 353,685 95,994
----------- -----------
GROSS MARGIN .......................................... 1,150,316 416,720
EXPENSES
Sales & Advertising Expenses .................... 99,824 10,017
General & Administrative Expenses ............... 629,726 169,954
Depreciation .................................... 47,918 21,694
Amortization .................................... 128,983 27,395
----------- -----------
Total Expenses ........................... 906,451 229,060
INCOME FROM OPERATIONS ................................ 243,865 187,660
INTEREST INCOME (EXPENSE) NET ......................... (2,257) (103,134)
----------- -----------
NET INCOME BEFORE TAXATION ............................ 241,608 84,526
PROVISION FOR INCOME TAXES ............................ (10,017) 0
----------- -----------
NET INCOME ............................................ $ 231,591 $ 84,526
=========== ===========
NET INCOME PER COMMON SHARE
Basic ........................................... $ 0.07 $ 0.05
Diluted ......................................... $ 0.07 $ 0.05
WEIGHTED AVERAGE COMMON SHARES OUTSTANDING
Basic ........................................... 3,195,672 1,632,325
Diluted ......................................... 3,431,446 1,750,020
</TABLE>
See accompanying Notes to Consolidated Financial Statement
4
<PAGE>
<TABLE>
<CAPTION>
Multi-link Telecommunications, Inc.
Consolidated Statements of Cash Flows
Three Months Ended
December 31, December 31,
1999 1998
----------- -----------
<S> <C> <C>
CASH FLOW FROM OPERATING ACTIVITIES
NET INCOME (LOSS) ......................................................... $ 231,591 $ 84,526
ADJUSTMENTS to reconcile net profit to net
cash generated from (used in) operating activities ......................
Depreciation and Amortization ....................................... 176,901 49,089
Amortization of Debt Discount and Issuance Costs .................... 7,293 7,175
Bad Debt Expense .................................................... 92,749 25,514
CHANGES IN OPERATING ASSETS & LIABILITIES
(Increase)/Decrease in Accounts Receivable .......................... (583,781) (103,093)
(Increase)/Decrease in Inventory .................................... (720) 0
(Increase)/Decrease in Prepayments .................................. (96,211) (16,179)
Increase/(Decrease) in Accounts Payable ............................. (161,518) (120,309)
Increase/(Decrease) in Accrued Expenses ............................. 74,290 (104,531)
Increase/(Decrease) in Deferred Revenue ............................. (20,600) (12,555)
----------- -----------
NET CASH (Used in)/Provided by Operating Activities ....................... (280,006) (190,363)
CASH FLOW FROM INVESTING ACTIVITIES
Purchase of Subscriber Accounts ..................................... (389,642) (72,731)
Purchase of Fixed Assets ............................................ (279,635) (26,572)
Advance on Note Receivable .......................................... (304,537) (204,543)
Sale of Marketable Securities ....................................... 1,712,238 0
Deferred Acquisition Costs .......................................... (104,528) 0
Purchase of Hellyer Communications' Business and Assets ............ (1,057,000) 0
----------- -----------
Total Cash Flow (used in) Investing Activities ................. (423,104) (303,846)
CASH FLOW FROM FINANCING ACTIVITIES
Payment of Related Party Notes Payable .............................. (2,268) (448,594)
Advances Under Related Party Notes Payable .......................... 0 79,283
Advances under Notes Payable ........................................ 1,700,000 150,000
Payments of Notes Payable ........................................... (581,435) (45,570)
Repurchase of Outstanding Shares .................................... 0 (5,721)
Proceeds from Issuance of Common Stock .............................. 0 590,000
Offering Costs ...................................................... 0 (192,557)
----------- -----------
Total Cash Flow provided by Financing Activities .............. 1,116,297 126,841
INCREASE/(DECREASE) IN CASH & CASH EQUIVALENTS ............................ 413,187 (367,368)
Cash and Cash Equivalents at the beginning of the period .................. 512,617 555,852
----------- -----------
Cash and Cash Equivalents at the end of the period ........................ $ 925,804 $ 188,574
=========== ===========
SUPPLEMENTAL SCHEDULE OF CASH FLOW INFORMATION
Cash Paid for Interest .................................................... $ 37,471 $ 125,041
----------- -----------
Conversion of Note Payable to Equity ...................................... $ 0 $ 35,000
----------- -----------
Consultancy and non-compete agreements acquired for equity ................ $ 956,624 $ 0
----------- -----------
Fixed assets purchased through debt ....................................... $ 1,105,472 $ 0
----------- -----------
Net liabilities assumed in business combination
accounted for as a purchase ............................................. $ 1,161,091 $ 0
----------- -----------
</TABLE>
See accompanying Notes to Consolidated Financial Statements.
5
<PAGE>
NOTES TO FINANCIAL STATEMENTS
Note 1 Basis of Presentation
The accompanying unaudited financial statements of Multi-Link
Telecommunications, Inc. have been prepared in accordance with generally
accepted accounting principles for interim financial information and with the
instructions to Form 10-QSB and Article 10 of Regulation S-X. Accordingly, they
do not include all of the information and footnotes required by generally
accepted accounting principles for complete financial statements. In our opinion
the financial statements include all adjustments (consisting of normal recurring
accruals) necessary in order to make the financial statements not misleading.
Operating results for the three-month period ended December 31, 1999 are not
necessarily indicative of the results that may be expected for the year ended
September 30, 2000. The September 30, 1999 balance sheet was derived from our
audited financial statements, but does not include all disclosures required by
generally accepted accounting principles. These statements should be read in
conjunction with the financial statements and related notes contained in our
latest Form 10-K which includes audited financial statements for the years ended
September 30, 1998 and 1999.
Note 2 Basis of Consolidation
On November 17, 1999 Multi-Link Telecommunications, Inc., through its newly
formed subsidiary, Hellyer Communications Services, Inc., acquired the business
and substantially all the assets of Hellyer Communications, Inc. for a
combination of cash, assumption of certain liabilities and common stock valued
at $4.2 million. Hellyer has been a provider of business messaging services
since 1969, and has over 40,000 subscribers in Indianapolis, Chicago and
Detroit. The purchase price was $1.1 million cash and the assumption of
approximately $2.1 million in liabilities. $956,000 in restricted common stock
was issued with a two-year vesting schedule with respect to non-compete and
consulting agreements. The results of the Hellyer Communications business have
been consolidated with those of Multi-Link Telecommunications, Inc. effective
November 17, 1999.
On November 29, 1999 Multi-Link Telecommunications, Inc., through its newly
formed subsidiary, Hellyer Communications Services, Inc., completed the
acquisition of approximately 10,000 residential voice-messaging subscribers from
Cashtel, Inc. in Chicago. The purchase price is expected to be approximately
$290,000 depending on the final number of customers transferred. Cashtel will be
paid $20 in cash plus $2 in restricted common stock for each active customer
transferred. In addition, Cashtel was paid $70,000 to meet the costs of
providing the messaging services to the customer base through January 31, 2000
when the transfer of customers onto the Company's systems was completed. The
revenues and expenses of these subscribers have been consolidated with those of
Multi-Link Telecommunications, Inc. effective November 29, 1999.
Note 3 Notes Payable
During the fiscal quarter ended December 31, 1999 Multi-Link
Telecommunications, Inc. drew down $1,000,000 under its five-year term loan with
Westburg Media Capital to provide additional finance for its acquisitions.
Multi-Link Telecommunications, Inc. also entered into a $700,000, 48- month
equipment financing facility at an interest rate of 9.25% per annum. These funds
were used to refinance existing equipment leases at higher rates of interest and
to purchase new equipment.
6
<PAGE>
Note 4 Subsequent Events
On January 6, 2000, Multi-Link Telecommunications, Inc., through its newly
formed subsidiary, One Touch Communications, Inc., acquired the business and
substantially all the assets of One Touch Communications, Inc., a provider of
advanced voice messaging services to businesses in Raleigh, North Carolina. The
purchase price was $3.12 million, $1.1 million in cash and $2.02 million in
restricted common stock. The sellers have agreed to hold the common stock for up
to two years from the date of closing.
In January 2000, Multi-Link Telecommunications, Inc. entered into a further
$250,000, 48- month equipment financing facility at an interest rate of 9.5% per
annum to finance the purchase of new equipment.
7
<PAGE>
ITEM 2. Management's Discussion and Analysis of Financial Condition and Results
of Operations.
The following discussion should be read in conjunction with the
consolidated financial statements included in this report. This discussion
contains forward-looking statements that involve risks and uncertainties. Our
actual results could differ materially from those anticipated in these forward
looking statements as a result of any number of factors, including but not
limited to, intensity of competition, customer attrition, disruption of local
telephone networks, technological obsolescence, cost of technology, the
availability of third party billing solutions, the availability of financing,
and our ability to manage our growth, the availability and success of future
acquisitions, the effects of regional economic and market conditions and
increases in marketing and sales costs.
OVERVIEW
Our long-term goal is to become a significant force within the US Unified
Messaging service industry, which is predicted by industry analysts to be an
important market over the next few years. At present we provide advanced voice
messaging services to businesses and homes. We plan to achieve this market
position by acquiring voice messaging subscribers through a national industry
consolidation plan, and then transition our customers to Unified Messaging
services as market demand for this service increases.
Our revenues are primarily derived from receiving fixed monthly service
fees for voice mail, installation and set-up charges and sales of ancillary
telecommunications services such as paging. We recognize revenues as we deliver
services. Annual prepayments by subscribers are recognized over the period
covered by the prepayment on a straight-line basis.
Our primary costs of delivering our voice messaging services to our
subscribers are our voice messaging platforms, maintenance costs and the
interconnection costs to the public switched telephone network. Most of our
general and administrative expenses are incurred in the processing and servicing
of new subscriber accounts.
We currently sell a small portion of our services through independent sales
agents and the majority through our in-house sales force. However, for the past
two years, the majority of our sales were made through independent sales agents.
All salaries and commissions associated with our in-house sales force are
expensed as incurred. All commissions paid to independent sales agents for
procuring subscribers are capitalized and amortized. We amortize these
subscriber account acquisition costs over the estimated economic life of
subscriber accounts or 36 months, whichever is less. During fiscal 1999, we
experienced an average subscriber attrition rate of 1.76% per month, indicating
a projected life of the subscriber portfolio of 57 months; as a result, we
currently amortize subscriber account acquisition costs over 36 months.
From inception through September 1998, we financed our operations and net
losses through factoring of customer contracts and working capital loans
provided by CS Capital Corp. at implied interest rates of up to 52% per annum.
In September 1998, we refinanced most of our indebtedness to CS Capital Corp.
with a five-year term loan from Westburg Media Capital LP. The Westburg loan has
an interest rate of 3% per annum over prime rate. In May 1999, we repaid all but
$10,000 of the Westburg loan from the proceeds of our initial public offering
and, as a result, experienced significantly lower net interest expense in fiscal
1999 than in prior years.
We plan to continue to increase revenues by increasing the number of
independent sales agents that offer our voice messaging services, by increasing
the range of telecommunications services we offer to our customers, and by
acquiring companies involved in the voice messaging industry. After completing
an acquisition, we plan to convert the operations of the acquired company to
conform to our current business model, where economically feasible.
8
<PAGE>
Acquisitions
On November 17, 1999 we completed the acquisition of substantially all of
the business, assets and certain liabilities of Hellyer Communications, Inc., a
provider of basic voice messaging services in Indianapolis, Detroit and Chicago.
As a result, our financial statements include the revenues and expenses of
Hellyer from the date of acquisition through December 31, 1999.
On November 29, 1999 we completed the acquisition of approximately 10,000
residential voice-messaging subscribers from Cashtel, Inc. in Chicago. As a
result, our financial statements include the revenues and expenses of these
subscribers from the date of acquisition through December 31, 1999.
On January 6, 2000 we completed the acquisition of all of the business,
assets and certain liabilities of One Touch Communications, Inc., a provider of
voice messaging services in Raleigh, North Carolina. Since this acquisition did
not take place until after the end of the quarter under review, One Touch had no
impact on these financial statements.
Results of Operations
Quarter ended December 31, 1999 compared to quarter ended December 31, 1998.
Net Revenues. Our revenues for the quarter ended December 31, 1999 were
$1,504,000 compared to $513,000 for the fiscal quarter ended December 31, 1998,
an increase of 193%. The increase was the combined result of (a) continuing
steady net growth in our base of customers at Multi-Link in Denver, (b) a price
rise for certain messaging services at our Denver operation in July 1999, and
(c) the inclusion of revenues from the Hellyer and Cashtel acquisitions
described above.
Cost of Services and Products. Cost of services and products for the fiscal
quarter ended December 31, 1999 was $354,000, compared to $96,000 for the fiscal
quarter ended December 31, 1998, an increase of 269%. The increase was the
result of servicing a greater number of customers in 1999 than in 1998 in
Denver, and the acquisition of customers at Hellyer and Cashtel.
Gross Profit Margin. Gross margin for the fiscal quarter ended December 31,
1999 was $1,150,000 compared to $417,000 for the fiscal quarter ended December
31, 1998, an increase of 176% due to the factors described above.
Gross Profit Margin Percentage. The gross profit margin of our Denver
operation increased to 87% compared to 81% in 1998. However, as a result of the
inclusion of Hellyer and Cashtel, which operate their residential customer
accounts and live answering businesses at lower gross profit margins than our
existing business services model, the overall gross profit margin declined from
81% to 76%.
Sales and Advertising Expense. Sales and advertising expenses for the
fiscal quarter ended December 31, 1999 were $100,000 compared to $10,000 for the
fiscal quarter ended December 31, 1998, an increase of 900%. This increase
resulted from the inclusion of sales and advertising expenses from Hellyer.
General and Administrative Expenses. General and administrative expenses
for the fiscal quarter ended December 31, 1999 were $630,000 compared to
$170,000 for the fiscal quarter ended December 31, 1998. This increase of 271%
was due to (a) increased costs of billing the increased revenues, (b) the costs
associated with our becoming a public company, including transfer agent fees,
legal fees, accounting fees and other professional expenses, and (c) the
inclusion of general and administrative expenses from Hellyer.
9
<PAGE>
EBITDA - Earnings Before Interest, Tax, Depreciation, and Amortization.
EBITDA for the fiscal quarter ended December 31, 1999 was $421,000 compared to
$237,000 for the fiscal quarter ended December 31, 1998, an increase of 77%.
This was partly attributable to the increased revenues and gross profits from
our existing Denver operations, and partly due to the inclusion of Hellyer for
the first time. "EBITDA" reflects net income or loss plus depreciation,
amortization and interest expense, income taxes and other non-cash charges.
EBITDA is a measure used by analysts and investors as an indicator of operating
cash flow because it excludes the impact of movements in working capital items,
non-cash charges and financing costs. However, EBITDA is not a measure of
financial performance under generally accepted accounting principles and should
not be considered a substitute for other financial measures of performance.
Depreciation of Equipment. Depreciation expense in the fiscal quarter ended
December 31, 1999 was $48,000 compared to $22,000 for the fiscal quarter ended
December 31, 1998. This increase of 118% was due to increased fixed assets at
both our existing operations, and the inclusion of Hellyer.
Amortization. Amortization was $129,000 for the fiscal quarter ended
December 31, 1999 compared to $27,000 for the fiscal quarter ended December 31,
1998. This increase of 378% was due to (a) continued customer account purchases
from our base of independent sales agents in the Denver area, (b) amortization
of goodwill on the acquisition of Hellyer and (c) the amortization of the non
compete agreement and consulting agreement relating to the Hellyer acquisition.
Income (Loss) from Operations. Income from operations was $244,000 for the
fiscal quarter ended December 31, 1999 compared to $188,000 for the fiscal
quarter ended December 31, 1998, an increase of 30% due to the factors discussed
above.
Net Interest Income (Expense). Net interest income (expense) for the fiscal
quarter ended December 31, 1999 was $(2,000), compared to $(103,000) for the
fiscal quarter ended December 31, 1998, a decrease of 98%. The decrease was
attributable to the significantly lower levels of debt after our initial public
offering in May 1999.
Net Income (Loss) and Comprehensive Income (Loss). We achieved a net income
of $232,000 for the fiscal quarter ended December 31, 1999, compared to a net
profit of $84,000 for the quarter ended December 31, 1998, an increase of 176%,
due to the factors outlined above. The comprehensive profit for the fiscal
quarter ended December 31, 1999 was $ 236,000, $4,000 more than the net profit
of $232,000. The difference of $4,000 relates to a reduction in the level of
unrealized losses on our portfolio of marketable securities, which are held as
available for sale investments. The net profit and comprehensive profit were the
same in fiscal quarter ended December 31, 1998.
Liquidity and Capital Resources
We continue to meet our capital requirements through (a) cash provided from
operations, (b) funds provided from our May 1999 initial public offering, (c) a
$2.1 million line of credit provided by Westburg Media Capital, and (d) various
long term equipment leasing facilities.
As of December 31, 1999, we were current on our obligations to all lenders
and in compliance with all debt covenants. As of December 31, 1999, we had
available cash and marketable investments of $3,038,000, available undrawn loan
facilities of $1,140,000 and $2,741,000 of debt.
For the three months ended December 31, 1999 net cash used in operations
was approximately $(280,000) compared to net cash used in operations of
$(190,000) for the three months ended December 31, 1998. Net cash used in
investing activities in the three months ended December 31, 1999 for the
purchase of the Hellyer Communications business, subscriber accounts (including
those acquired from Cashtel) and fixed assets, less the proceeds realized from
10
<PAGE>
the sale of marketable securities was $(423,000) compared to $(304,000) for the
three months ended December 31, 1998. During the three months ended December 31,
1999, financing activities generated $1,116,000 of net cash from the draw down
of $1,000,000 from the Westburg Media Capital loan facility and $700,000 from
new equipment financing facilities, less the repayment of $581,000 of existing
leasing facilities, compared to the three months ended December 31, 1998 where
financing activities generated $127,000 of net cash.
We used approximately $1.1 million of our cash to complete the acquisition
of the assets of One Touch Communications, Inc. on January 6, 2000. As of
February 10, 1999 we had committed to the purchase of approximately $350,000 of
additional voice messaging equipment from Glenayre for which we are actively
seeking appropriate long-term equipment financing.
We anticipate that our existing cash balances and marketable securities
together with internally generated funds from operations and the Westburg
revolving term loan will be sufficient to meet our presently projected operating
requirements for the next 12 months.
We plan to continue our industry consolidation plan and to acquire more
companies involved in the messaging industry. It is likely that we will seek
additional debt and equity financing to support our acquisition programs over
the next twelve months.
Effects of Inflation
Although we cannot accurately anticipate the effect of inflation on our
operations, we do not believe that inflation has had, or is likely in the future
to have, a material effect on our operating results or financial condition.
Year 2000 Issue
We did not experience any year 2000 problems with any of our operating
software or voice messaging equipment. To the best of our knowledge, none of our
suppliers have experienced any year 2000 problems in providing us with the goods
and services that we require from them. We did not incur any material costs in
preparing for year 2000 compliance.
11
<PAGE>
PART II OTHER INFORMATION
Item 1. Legal Proceedings.
The Company is not a party to any legal proceedings.
Item 2. Changes in Securities.
Recent Sales of Unregistered Securities
On November 17, 1999, in connection with the purchase of the assets of
Hellyer Communications, Inc., the Company entered into a
Non-Competition Agreement and a Consulting Agreement with Jerry L.
Hellyer. The Non-Competition Agreement provided that the Company issue
107,143 shares of Common Stock to Mr. Hellyer. The Consulting
Agreement provided that the Company issue 42,857 shares of Common
Stock to Mr. Hellyer. Such shares are subject to forfeiture pursuant
to the terms of the Non - Competition Agreement and Consulting
Agreement. The issuances were exempt from registration under the
Securities Act of 1933, as amended (the "Securities Act"), pursuant to
Section 4(2) of the Securities Act and/or Rule 506 under Securities
Act. Mr. Hellyer represented that he was an "accredited investor" as
that term is defined in Rule 501 under the Securities Act. No
underwriters were engaged in connection with such issuances.
Use of Proceeds from Registered Securities
On May 14, 1999, the registration statement filed by the Company
relating to its initial public offering was declared effective by the
SEC (File No. 333-72889). Pursuant to the registration statement, the
Company registered the sale of 1,380,000 units, each comprised of one
share of common stock and one warrant. The Company received total
gross proceeds of $8,280,000. The Company paid underwriting discounts
and commissions and expenses to the underwriters of $1,076,400. In
addition, the Company paid other expenses of the offering of
approximately $344,200. The total net proceeds minus expenses were
$6,859,400.
Since completion of the offering through December 31, 1999, the
Company has paid: $2,140,000 to Westburg Media Capital L.P. to pay
down the outstanding balance of the revolving loan; $1,057,000 as
partial consideration in connection with the acquisition of Hellyer
Communications, Inc; $698,000 to repay a portion of Hellyer's
liabilities that we assumed, and to pay costs associated with the
transaction; $304,000 as an advance under a note receivable from Jerry
L. Hellyer; $195,000 as partial consideration in connection with the
acquisition of the subscribers of Cashtel Inc. and approximately
$250,000 for capital expenditures and general corporate purposes.
Item 3. Defaults upon Senior Securities.
None.
Item 4. Submission of Matters to Vote of Security Holders.
None.
Item 5. Other Information.
None.
12
<PAGE>
Item 6. Exhibits and Reports on Form 8-K.
a. Exhibits.
27.1 Financial Data Schedule
b. Reports on Form 8-K.
On December 3, 1999, the Company filed a Form 8-K in which
items 2 and 7 were reported. No financial statements were
included therein.
13
<PAGE>
SIGNATURES
In accordance with the requirements of the Exchange Act, the registrant
caused this report to be signed on its behalf by the undersigned, thereunto duly
authorized.
MULTI-LINK TELECOMMUNICATIONS, INC,
(Registrant)
Date: February 28, 2000 /s/ Nigel V. Alexander
--------------------------------------
Nigel V. Alexander,
Chief Executive Officer.
Date: February 28, 2000 /s/ Shawn B. Stickle
--------------------------------------
Shawn B. Stickle,
President and Chief Operating Officer.
Date: February 28, 2000 /s/ David J. C. Cutler
--------------------------------------
David J.C. Cutler,
Chief Financial Officer.
14
<TABLE> <S> <C>
<ARTICLE> 5
<RESTATED>
<S> <C>
<PERIOD-TYPE> 12-MOS
<FISCAL-YEAR-END> SEP-30-1999
<PERIOD-START> OCT-01-1998
<PERIOD-END> DEC-31-1999
<CASH> 925,804
<SECURITIES> 2,112,366
<RECEIVABLES> 1,250,912
<ALLOWANCES> 98,621
<INVENTORY> 23,109
<CURRENT-ASSETS> 4,361,015
<PP&E> 3,085,090
<DEPRECIATION> 310,689
<TOTAL-ASSETS> 11,488,062
<CURRENT-LIABILITIES> 2,122,746
<BONDS> 2,342,311
0
0
<COMMON> 8,688,402
<OTHER-SE> (1,658,396)
<TOTAL-LIABILITY-AND-EQUITY> 11,488,062
<SALES> 25,551
<TOTAL-REVENUES> 1,504,001
<CGS> 32,445
<TOTAL-COSTS> 353,685
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 92,749
<INTEREST-EXPENSE> 2,257
<INCOME-PRETAX> 241,608
<INCOME-TAX> 10,017
<INCOME-CONTINUING> 231,591
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 231,591
<EPS-BASIC> 0.07
<EPS-DILUTED> 0.07
</TABLE>
