LINC NET INC, S-1, 2000-09-12

LINC NET INC
S-1, 2000-09-12

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<PAGE>
AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON SEPTEMBER 12, 2000
REGISTRATION NO. 333-
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------

SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549

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

FORM S-1

REGISTRATION STATEMENT

UNDER

THE SECURITIES ACT OF 1933

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

LINC.NET, INC.

(Exact name of registrant as specified in its charter)

<TABLE>
<S> <C> <C>
DELAWARE 7385 36-4318863
(State or other jurisdiction (Primary Standard (I.R.S. Employer
of Industrial Identification No.)
incorporation or organization) Classification Code Number)
</TABLE>

6161 BLUE LAGOON DRIVE, SUITE 300, MIAMI, FLORIDA 33126
(305) 266-7670

(Address, including zip code, and telephone number, including
area code, of registrant's principal executive offices)

ISMAEL PERERA
PRESIDENT AND CHIEF EXECUTIVE OFFICER, LINC.NET, INC.
6161 BLUE LAGOON DRIVE, SUITE 300, MIAMI, FLORIDA 33126
(305) 266-7670

(Name, address, including zip code, and telephone number, including area code,
of agent for service)

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

COPIES OF ALL COMMUNICATIONS, INCLUDING COMMUNICATIONS SENT TO AGENT FOR
SERVICE, SHOULD BE SENT TO:

<TABLE>
<S> <C>
CARTER W. EMERSON, P.C. JOEL S. KLAPERMAN
TED H. ZOOK Shearman & Sterling
Kirkland & Ellis 599 Lexington Avenue
200 East Randolph Drive New York, New York 10022
Chicago, Illinois 60601 (212) 848-4000
(312) 861-2000
</TABLE>

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

APPROXIMATE DATE OF COMMENCEMENT OF PROPOSED SALE TO THE PUBLIC:
As soon as practicable after this Registration Statement becomes effective.

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

If any of the securities being registered on this Form are to be offered on
a delayed or continuous basis pursuant to Rule 415 under the Securities Act of
1933, check the following box. / /

If this Form is filed to register additional securities for an offering
pursuant to Rule 462(b) under the Securities Act, please check the following box
and list the Securities Act registration statement number of the earlier
effective registration statement for the same offering. / /

If this Form is a post-effective amendment filed pursuant to Rule 462(c)
under the Securities Act, check the following box and list the Securities Act
registration statement number of the earlier effective registration statement
for the same offering. / /

If this Form is a post-effective amendment filed pursuant to Rule 462(d)
under the Securities Act, check the following box and list the Securities Act
registration statement number of the earlier effective registration statement
for the same offering. / /

If delivery of the prospectus is expected to be made pursuant to Rule 434,
please check the following box. / /
------------------------------

CALCULATION OF REGISTRATION FEE

<TABLE>
<CAPTION>
TITLE OF EACH CLASS OF SECURITIES PROPOSED MAXIMUM AGGREGATE AMOUNT OF
TO BE REGISTERED OFFERING PRICE(1)(2) REGISTRATION FEE
<S> <C> <C>
Common Stock, par value $.01 per share... $75,000,000 $19,800
</TABLE>

(1) Includes shares of Common Stock that the Underwriters have the option to
purchase from Linc.net to cover over-allotments, if any.

(2) Estimated solely for the purpose of calculating the registration fee
pursuant to Rule 457(o) under the Securities Act of 1933, as amended.
------------------------------

THE REGISTRANT HEREBY AMENDS THIS REGISTRATION STATEMENT ON SUCH DATE OR
DATES AS MAY BE NECESSARY TO DELAY ITS EFFECTIVE DATE UNTIL THE REGISTRANT SHALL
FILE A FURTHER AMENDMENT WHICH SPECIFICALLY STATES THAT THIS REGISTRATION
STATEMENT SHALL THEREAFTER BECOME EFFECTIVE IN ACCORDANCE WITH SECTION 8(A) OF
THE SECURITIES ACT OF 1933 OR UNTIL THIS REGISTRATION STATEMENT SHALL BECOME
EFFECTIVE ON SUCH DATE AS THE COMMISSION, ACTING PURSUANT TO SAID SECTION 8(A),
MAY DETERMINE.

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--------------------------------------------------------------------------------
<PAGE>
PROSPECTUS (SUBJECT TO COMPLETION)
ISSUED SEPTEMBER 12, 2000
THE INFORMATION IN THIS PROSPECTUS IS NOT COMPLETE AND MAY BE CHANGED. WE MAY
NOT SELL THESE SECURITIES UNTIL THE REGISTRATION STATEMENT FILED WITH THE
SECURITIES AND EXCHANGE COMMISSION IS EFFECTIVE. THIS PROSPECTUS IS NOT AN OFFER
TO SELL THESE SECURITIES AND WE ARE NOT SOLICITING AN OFFER TO BUY THESE
SECURITIES IN ANY STATE WHERE THE OFFER OR SALE IS NOT PERMITTED.
<PAGE>
SHARES

[LOGO]

COMMON STOCK

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

LINC.NET, INC. IS OFFERING SHARES OF ITS COMMON STOCK. THIS IS OUR INITIAL
PUBLIC OFFERING AND NO PUBLIC MARKET CURRENTLY EXISTS FOR OUR SHARES. WE
ANTICIPATE THAT THE INITIAL PUBLIC OFFERING PRICE WILL BE BETWEEN $ AND
$ PER SHARE.

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

WE INTEND TO FILE AN APPLICATION FOR OUR COMMON STOCK TO BE LISTED ON THE NEW
YORK STOCK EXCHANGE UNDER THE SYMBOL "LN."

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

INVESTING IN OUR COMMON STOCK INVOLVES RISKS. SEE "RISK FACTORS" BEGINNING ON
PAGE 10.

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

PRICE $ A SHARE

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

<TABLE>
<CAPTION>
UNDERWRITING
PRICE TO DISCOUNTS AND PROCEEDS TO
PUBLIC COMMISSIONS LINC.NET
-------- ------------- -----------
<S> <C> <C> <C>
PER SHARE............................... $ $ $
TOTAL................................... $ $ $
</TABLE>

LINC.NET, INC. HAS GRANTED THE UNDERWRITERS THE RIGHT TO PURCHASE UP TO AN
ADDITIONAL SHARES TO COVER OVER-ALLOTMENTS.

THE SECURITIES AND EXCHANGE COMMISSION AND STATE SECURITIES REGULATORS HAVE NOT
APPROVED OR DISAPPROVED THESE SECURITIES, OR DETERMINED IF THIS PROSPECTUS IS
TRUTHFUL OR COMPLETE. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.

MORGAN STANLEY & CO. INCORPORATED EXPECTS TO DELIVER THE SHARES OF COMMON STOCK
TO PURCHASERS ON , 2000.

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

MORGAN STANLEY DEAN WITTER BANC OF AMERICA SECURITIES LLC

FIRST UNION SECURITIES, INC.

, 2000
<PAGE>
[description of graphics]

2
<PAGE>
TABLE OF CONTENTS

<TABLE>
<CAPTION>
PAGE
--------
<S> <C>
Prospectus Summary.................... 4
Risk Factors.......................... 10
Cautionary Note Regarding Forward-
Looking Statements.................. 21
Use of Proceeds....................... 22
Dividend Policy....................... 22
Capitalization........................ 23
Dilution.............................. 24
Selected Historical Financial Data.... 25
Unaudited Pro Forma Condensed
Consolidated Financial Statements... 27
Management's Discussion and Analysis
of Financial Condition and Results
of Operations....................... 44
Business.............................. 53
</TABLE>

<TABLE>
<CAPTION>
PAGE
--------
<S> <C>
Management............................ 62
Principal Stockholders................ 72
Certain Relationships and Related
Transactions........................ 75
Description of Certain Indebtedness... 77
Description of Capital Stock.......... 79
Shares Eligible for Future Sale....... 82
Material U.S. Federal Tax Consequences
to Non-U.S. Holders................. 84
Underwriters.......................... 88
Legal Matters......................... 92
Experts............................... 92
Where You Can Find More Information... 93
Index to Financial Statements......... F-1
</TABLE>

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

You should rely only on the information contained in this prospectus. We
have not authorized anyone to provide you with information different from that
contained in this prospectus. We are offering to sell shares of common stock and
seeking offers to buy shares of common stock, only in jurisdictions where offers
and sales are permitted. The information contained in this prospectus is
accurate only as of the date of this prospectus, regardless of the time of
delivery of this prospectus or any sale of the common stock. In this prospectus,
"Linc.net," "we," "us" and "our" refer to Linc.net, Inc. and its subsidiaries,
unless the context otherwise requires.
------------------------

On August 31, 2000, we agreed to acquire all of the outstanding capital
stock of InterCon Construction, Inc., or Intercon, for $41.7 million, which
amount includes transaction costs incurred by us. We expect to complete the
acquisition of Intercon prior to the completion of this offering. Some of the
information contained in this prospectus assumes that the acquisition of
Intercon will be completed on the terms set forth in the Intercon purchase
agreement dated August 31, 2000, as amended on September 11, 2000, by and among
Intercon, certain sellers named therein and us, which is attached as an exhibit
to the registration statement of which this prospectus is a part. If the
acquisition of Intercon is not completed, the shares of common stock offered
hereby would represent an ownership interest in Linc.net as it exists on the
date of this prospectus and not of Linc.net as combined with Intercon.
Therefore, if the acquisition of Intercon is not completed, the information
contained in this prospectus assuming the completion of such acquisition would
not be relevant. For more information, see "Risk Factors--Risks Relating to Our
Company--In the event we are unable to complete the Intercon acquisition, some
of the information and financial data contained in this prospectus will not be
relevant to you" and "Unaudited Pro Forma Condensed Consolidated Financial
Statements."
------------------------

Immediately prior to this offering, we intend to reclassify all of our
outstanding shares of Series A mandatorily redeemable preferred stock and
Series B redeemable preferred stock into a single class of common stock. We
refer to this process as the "reclassification." The reclassification is
described further in the section titled "Description of Capital Stock--The
Reclassification." Except as otherwise indicated, the number of shares of our
outstanding common stock in this prospectus assumes:

- no exercise of the underwriters' over-allotment option; and

- the completion of the reclassification.
------------------------

UNTIL , 2000 (25 DAYS AFTER THE DATE OF THIS PROSPECTUS), ALL
DEALERS THAT BUY, SELL OR TRADE SHARES, WHETHER OR NOT PARTICIPATING IN THIS
OFFERING, MAY BE REQUIRED TO DELIVER A PROSPECTUS. THIS IS IN ADDITION TO THE
DEALERS' OBLIGATION TO DELIVER A PROSPECTUS WHEN ACTING AS UNDERWRITERS AND WITH
RESPECT TO THEIR UNSOLD ALLOTMENTS OR SUBSCRIPTIONS.

3
<PAGE>
PROSPECTUS SUMMARY

YOU SHOULD READ THE FOLLOWING SUMMARY TOGETHER WITH THE MORE DETAILED
INFORMATION REGARDING OUR COMPANY AND THE COMMON STOCK BEING SOLD IN THIS
OFFERING AND OUR FINANCIAL STATEMENTS AND RELATED NOTES AND OTHER FINANCIAL
INFORMATION APPEARING ELSEWHERE IN THIS PROSPECTUS.

LINC.NET, INC.

Linc.net is a full-service provider of high-quality network infrastructure
services, with leading positions in the central office installation, network
infrastructure engineering and last mile deployment markets. We engineer,
install and maintain electronic, digital subscriber line (DSL) and optical
telecommunications equipment in the central offices of major network providers.
We also perform engineering, program management and installation of fiber optic
and other cabling and related equipment for wireless and wireline
telecommunications providers. We offer our full range of services, either
bundled or separately, under the Linc.net national brand. We have completed ten
acquisitions in order to build a national presence and develop a full range of
service offerings, which allows us to market our capabilities and cross-sell our
service offerings to national customers. On August 31, 2000, we agreed to
acquire all of the oustanding capital stock of Intercon, a network
infrastructure service provider operating primarily in the midwestern United
States. We will selectively pursue additional acquisitions to bolster our
national presence and to augment our service offerings.

Our diverse customer base includes incumbent local exchange carriers
(ILECs), competitive local exchange carriers (CLECs), rural exchange carriers,
telecommunications equipment manufacturers, Internet providers, cable television
operators, long distance carriers, wireless phone companies, co-location
facilities providers and public and private energy companies. Assuming the
completion of the Intercon acquisition, at September 6, 2000, Linc.net had
approximately 3,700 employees, including over 400 network engineers and over 700
network technicians.

OUR MARKET OPPORTUNITY

We believe the following factors will lead to a continuing increase in
demand for our services:

- DEMAND FOR BANDWIDTH. We believe that, to meet the demands of their
customers and to remain competitive, telecommunications, Internet and
cable television providers will continue to expand and, in many cases,
replace their network infrastructures to deliver greater bandwidth.

- RAPIDLY CHANGING TECHNOLOGIES. Central offices are made up of equipment
using complex networking technology that, like other technologies,
continues to evolve rapidly, offering improvements in speed, capacity and
other capabilities. Given the current state of network equipment
technology and the magnitude of the demand for network traffic and
performance, we believe that networking equipment will continue to evolve
rapidly and that the life cycle for this equipment will continue to
shorten.

- LARGE INVESTMENTS NECESSARY TO OVERCOME THE LAST MILE BOTTLENECK. As the
volume and breadth of information generated by Internet applications and
other broadband services continue to increase, network providers need to
supply additional bandwidth to end-users in the local access network, or
last mile. Given the rising demand for bandwidth and the relatively early
stage of upgrades in the last mile, we believe that network providers will
continue to make heavy investments in upgrading the capabilities of the
local access network.

- INCREASED DEMAND FOR OUTSOURCED INFRASTRUCTURE SERVICES. Because of an
overall skill shortage and the rapidly changing technology and industry
landscape, companies have increasingly found it more cost-effective to use
outside providers for high-quality engineering, installation and
management services, allowing them to focus their internal resources on
core business competencies.

4
<PAGE>
OUR SOLUTION

We provide our customers with high-quality network engineering, installation
and maintenance services that, in turn, allow them to deliver their services
reliably and cost-effectively. The following are the key elements of the
Linc.net solution:

- END-TO-END OFFERINGS. We provide a full range of network infrastructure
service offerings, including engineering, installation and maintenance of
central office equipment as well as infrastructure design, deployment and
program management. We have the ability to offer customers our services
individually or as bundled offerings that we market as Linc.net e-net
Solutions(SM).

- NETWORK INFRASTRUCTURE TECHNOLOGY LEADERSHIP. We offer customers advanced
network infrastructure services that use the best available technology and
practices to provide proven and reliable solutions. We believe that our
technical leadership across different technologies and vendor products
allows us to quickly, accurately and cost-effectively address the complex
and critical network infrastructure issues that face our customers.

- NATIONAL PRESENCE. We maintain a national presence through which we offer
our full range of services, and we believe that this allows us to more
rapidly and efficiently address the needs of our customers as they
continue to converge and consolidate.

- INDUSTRY EXPERTISE. Our chief executive officer, Ismael Perera, has spent
his entire professional career in the telecommunications industry and
brings to Linc.net over 30 years of industry experience in network design,
deployment and maintenance. Each of our business units has a history of
successfully delivering high-quality services to their telecommunications,
Internet, cable television and energy customers.

OUR STRATEGY

Our objective is to become the leading national provider of end-to-end
network infrastructure services to telecommunications, Internet and cable
television providers. Our strategy for achieving this objective is as follows:

- EXPAND LEADERSHIP POSITION IN KEY MARKETS. We believe that we have a
leadership position in three key markets that are particularly important
due to the rapidly changing nature of network technology and the need for
increased bandwidth delivered to the end user: network infrastructure
engineering, central office installation and last mile deployment. We will
continue to focus resources on these key markets.

- ESTABLISH LINC.NET BRAND. We intend to develop a strong national brand
under which we will offer end-to-end network infrastructure solutions
through our system of regional and national specialty hubs.

- ATTRACT, RETAIN AND TRAIN HIGHLY SPECIALIZED WORK FORCE. We will continue
to devote significant resources and attention to the recruitment and
retention of highly skilled employees.

- LEVERAGE RESOURCES AND KNOWLEDGE ACROSS BUSINESS UNITS. We intend to
leverage the substantial experience and resources of our various business
units across our organization to ensure cost-effective, efficient and
high-quality delivery of services to our customers.

- SELECTIVELY PURSUE STRATEGIC ACQUISITIONS. We will selectively pursue
strategic acquisitions to round out our geographic coverage and to
complement our existing service offerings.
------------------------

Linc.net is a Delaware corporation organized in October 1999. Our principal
executive offices are located at 6161 Blue Lagoon Drive, Suite 300, Miami,
Florida 33126, and our telephone number is (305) 266-7670.

5
<PAGE>
THE OFFERING

<TABLE>
<S> <C>
Common stock offered......................... shares

Common stock to be outstanding after this shares
offering...................................

Over-allotment option........................ shares

Use of proceeds.............................. We will receive net proceeds from this offering of
approximately $ million. We intend to use 50% of the
net proceeds to repay outstanding indebtedness under
our senior credit facility and the remainder for
general corporate purposes.

Dividend policy.............................. We do not intend to pay dividends on our common
stock. We plan to retain any earnings for use in the
operation of our business and to fund future growth.

Proposed New York Stock Exchange symbol...... LN
</TABLE>

The number of shares of common stock to be outstanding after this offering
is based on the number of shares outstanding as of September 6, 2000. Shares of
our common stock outstanding after this offering do not include:

- shares issuable upon the exercise of outstanding options granted
under our existing stock option and long-term equity incentive plans,
of which were then exercisable;

- additional shares reserved for future grants, awards or sales under
our long-term equity incentive plan; and

- additional shares reserved for sale under our employee stock
purchase plan.

6
<PAGE>
SUMMARY CONSOLIDATED HISTORICAL AND PRO FORMA FINANCIAL DATA

Below is a summary of our consolidated financial data for the periods and as
of the dates indicated.

HISTORICAL FINANCIAL DATA. We were formed in October 1999. We acquired M&P
Utilities, Inc. and its affiliate Muller & Pribyl Utilities, Inc., which we
collectively refer to as M&P, on December 21, 1999. M&P is our corporate
predecessor for accounting purposes and, therefore, its historical financial
statements are deemed to be our historical financial statements. The following
summary historical financial data for our predecessor, M&P, for the period from
January 1, 1999 to December 21, 1999 have been derived from M&P's audited
financial statements and notes thereto, which are included elsewhere in this
prospectus.

We acquired our first company on October 19, 1999. The historical financial
statements for the period from October 19, 1999 to December 31, 1999 relate to
Linc.net and the companies it acquired from its inception through December 31,
1999 and have been derived from our audited financial statements and notes
thereto, which are included elsewhere in this prospectus.

Data for the six months ended June 30, 1999 are derived from M&P's
accounting records and are unaudited. Data as of and for the six months ended
June 30, 2000 were derived from our unaudited consolidated financial statements.
The summary historical financial data as of June 30, 2000 and for the six months
ended June 30, 2000 and 1999 have been prepared, in the opinion of management,
on the same basis as the audited financial statements and reflect all
adjustments (consisting of normal recurring adjustments) necessary for the fair
presentation of the financial condition and results of operations for such
periods. Results for the six months ended June 30, 2000 are not necessarily
indicative of results that may be expected for the entire year.

PRO FORMA FINANCIAL DATA. We prepared the summary condensed consolidated pro
forma financial data to illustrate the estimated effects of the acquisitions,
including the proposed Intercon acquisition described under "Unaudited Pro Forma
Condensed Consolidated Financial Statements."

We prepared the summary pro forma, as adjusted balance sheet data to
illustrate the estimated effects of the acquisitions and:

- the reclassification of all of our outstanding stock into a single class
of common stock and

- this offering and our use of the proceeds to repay debt and for general
corporate purposes.

The pro forma statement of operations data for the year ended December 31,
1999 are presented as if these transactions had occurred on January 1, 1999. The
pro forma statement of operations data for the six months ended June 30, 1999
are presented as if these transactions had occurred on January 1, 1999 and the
pro forma statement of operations data for the six months ended June 30, 2000
are presented as if these transactions had occurred on January 1, 2000. The pro
forma balance sheet data is presented as if these transactions, to the extent
not included in Linc.net's historical consolidated balance sheet at June 30,
2000, had occurred on June 30, 2000. We believe that the assumptions used
provide a reasonable basis for presenting the significant effects directly
attributable to these transactions, however, the pro forma or pro forma, as
adjusted data do not purport to represent what our results of operations would
actually have been if such transactions had in fact occurred on such dates or to
project results for any future period.

The following summary consolidated historical and pro forma financial data
should be read in conjunction with "Management's Discussion and Analysis of
Financial Condition and Results of Operations," "Unaudited Pro Forma Condensed
Consolidated Financial Statements," our financial statements and related notes
and other financial information appearing elsewhere in this prospectus.

7
<PAGE>

<TABLE>
<CAPTION>
HISTORICAL PRO FORMA
------------------------------------------------------- ---------------------------------------
PERIOD FROM PERIOD FROM
JANUARY 1, OCTOBER 19, SIX MONTHS ENDED SIX MONTHS ENDED
1999 TO 1999 TO JUNE 30, YEAR ENDED JUNE 30,
DECEMBER 21, DECEMBER 31, ----------------------- DECEMBER 31, -----------------------
1999 1999 1999 2000 1999 1999 2000
------------- ------------- ----------- --------- ------------- ---------- ----------
(IN THOUSANDS, EXCEPT SHARE DATA)
<S> <C> <C> <C> <C> <C> <C> <C>
STATEMENT OF OPERATIONS DATA:
Net revenue................... $43,916 $ 1,760 $16,800 $ 67,717 $ 421,305 $ 188,615 $ 272,927
Costs of sales................ 32,701 1,581 12,862 55,647 348,986 157,457 223,319
------- -------- ------- --------- ---------- ---------- ----------
Gross profit.................. 11,215 179 3,938 12,070 72,319 31,158 49,608
Costs and expenses:
General and administrative
expenses.................... 1,781 868 786 6,395 32,499 16,078 16,111
Amortization of goodwill...... -- 107 -- 2,124 13,464 6,732 6,732
Management fees............... -- 250 -- 500 250 -- 500
Noncash stock compensation.... -- -- -- -- 560 560 --
------- -------- ------- --------- ---------- ---------- ----------
Income (loss) from
operations.................. 9,434 (1,046) 3,152 3,051 25,546 7,788 26,265
Other (income) expenses:
Interest (income) expense,
net......................... (63) 360 (54) 5,093 24,550 12,275 12,275
Transaction-related
expenses.................... 4,485 -- -- -- -- -- --
Other (income) expense, net... 31 (47) (10) (64) (430) (133) (202)
------- -------- ------- --------- ---------- ---------- ----------
Income (loss) before income
taxes and equity in income
of investee................. 4,981 (1,359) 3,216 (1,978) 1,426 (4,354) 14,192
Equity in income of
investee.................... -- -- -- 1,754 -- -- --
------- -------- ------- --------- ---------- ---------- ----------
Income (loss) before income
taxes....................... 4,981 (1,359) 3,216 (224) 1,426 (4,328) 14,192
Income taxes.................. 71 (529) 2 (791) 556 (1,698) 5,534
------- -------- ------- --------- ---------- ---------- ----------
Net income (loss)............. 4,910 (830) 3,214 567 870 (2,656) 8,658
Preferred stock dividends..... -- (252) -- (2,798) (12,787) (6,394) (6,394)
------- -------- ------- --------- ---------- ---------- ----------
Net income (loss) to common
stockholders................ $ 4,910 $ (1,082) $ 3,214 $ (2,231) $ (11,917) $ (9,050) $ 2,264
======= ======== ======= ========= ========== ========== ==========
Net income (loss) per share:
Basic....................... $ (7.51) $ (4.02) $ (8.39) $ (6.37) $ 1.59
Diluted..................... $ (7.51) -- (4.02) (8.39) (6.37) 1.59
Weighted average common shares
outstanding:
Basic....................... 143,954 555,663 1,419,619 1,419,619 1,419,619
Diluted..................... 143,954 555,663 1,419,619 1,419,619 1,419,619

OTHER FINANCIAL DATA:
EBITDA........................ $ 6,458 $ (845) $ 3,699 $ 9,093 $ 48,139 $ 18,825 $ 39,355
Depreciation.................. 1,540 47 537 2,100 8,699 4,172 6,156
Amortization.................. -- 107 -- 2,124 13,464 6,732 6,732
Cash provided by (used in):
Operating activities........ 7,251 (42) 2,215 (23,391)
Investing activities........ (1,251) (97,103) (436) (103,264)
Financing activities........ (7,305) 100,694 (3,230) 126,341
</TABLE>

<TABLE>
<CAPTION>
AS OF JUNE 30, 2000
-------------------------------------
PRO FORMA, AS
ACTUAL PRO FORMA ADJUSTED
-------- ---------- -------------
(IN THOUSANDS)
<S> <C> <C> <C>
BALANCE SHEET DATA:
Working capital............................................. $ 42,628 $ 61,845
Total assets................................................ 256,613 474,274
Long-term debt and capital lease obligations................ 131,500 223,557
Stockholders' equity........................................ 8,963 14,787
</TABLE>

8
<PAGE>
EBITDA is defined in this prospectus as income (loss) before provision for
income taxes, plus depreciation, amortization of goodwill and interest expense,
net. EBITDA is presented because we believe it is a widely accepted financial
indicator of a company's ability to service and/or incur indebtedness. However,
EBITDA should not be considered as an alternative to net income as a measure of
operating results or to cash flows as a measure of liquidity in accordance with
generally accepted accounting principles. Additionally, EBITDA may not be
comparable to similarly titled measures reported by other companies.

9
<PAGE>
RISK FACTORS

INVESTING IN OUR COMMON STOCK INVOLVES A HIGH DEGREE OF RISK. YOU SHOULD
CAREFULLY CONSIDER THE RISKS DESCRIBED BELOW BEFORE MAKING AN INVESTMENT
DECISION. OUR BUSINESS, FINANCIAL CONDITION OR RESULTS OF OPERATIONS COULD BE
MATERIALLY ADVERSELY AFFECTED BY ANY OF THESE RISKS. THE TRADING PRICE OF OUR
COMMON STOCK COULD DECLINE DUE TO ANY OF THESE RISKS, AND YOU MAY LOSE ALL OR
PART OF YOUR INVESTMENT. YOU SHOULD ALSO REFER TO THE OTHER INFORMATION INCLUDED
IN THIS PROSPECTUS.

RISKS RELATING TO OUR INDUSTRY AND THE INDUSTRIES WE SERVE

OUR REVENUES DEPEND ON THE FINANCIAL RESOURCES OF OUR CUSTOMERS AND THEIR
ABILITY TO OBTAIN THE CAPITAL REQUIRED TO INSTALL, UPGRADE OR REPLACE NETWORK
INFRASTRUCTURES.

A number of factors, including financing conditions for telecommunications,
Internet, cable television and energy providers, could adversely affect our
current and potential customers and their ability or willingness to fund
operations and deploy networks in the future. If customers fail to receive
sufficient appropriations or rate increase approvals from regulatory authorities
or fail to receive adequate financing from other sources, such customers could
reduce the volume of work that they award to us, cancel any work we may have
started or delay payments to us, each of which could have a material adverse
effect on our operations.

THE TELECOMMUNICATIONS, INTERNET, CABLE TELEVISION AND ENERGY INDUSTRIES ARE
SUBJECT TO RAPID TECHNOLOGICAL AND REGULATORY CHANGES THAT COULD REDUCE THE
DEMAND FOR OUR SERVICES.

We derive a substantial portion of our revenue from customers in the
telecommunications, Internet and cable television industries. New or developing
technologies, including the proliferation of broadband wireless services, could
displace the wireline systems used as a transmission medium for voice, video and
data. Improvements in existing technology could also allow these providers to
significantly improve their networks without using a network infrastructure
service provider. In addition, the telecommunications, Internet and cable
television industries have been characterized by a significant number of mergers
and other consolidations that may result in the loss of, or reduced purchases
by, one or more of our customers, which may cause our revenue or income to
decline. We also derive a substantial portion of our revenue from customers in
the energy industry. The energy industry is also entering into a phase of
deregulation and consolidation similar to the telecommunications, Internet and
cable television industries, which could lead to the same uncertainties. For
more information on the effects of industry deregulation and consolidation, see
"--Risks Relating to Our Company--Our largest customers have historically
accounted for a significant portion of our revenue. Accordingly, our business
may be adversely affected by the loss of, or reduced purchases by, one or more
of our large customers."

IF THE GROWTH IN THE USE OF THE INTERNET DECLINES, THE DEMAND FOR A PORTION OF
OUR SERVICES AND OUR GROWTH MAY ALSO DECLINE.

Increased demand for bandwidth helps drive growth in our business. Providing
households with broadband Internet connections and revamping technology to
handle the added traffic generate significant revenue for our company. If growth
in Internet usage does not continue, or grows more slowly than expected, our
growth may decline and our business may be harmed. Customers and businesses may
reject the Internet as a viable business tool going forward for a number of
reasons, including:

- delays in the development of Internet enabling technologies and
performance improvements,

- delays in the development of security and authentication technology
necessary to effect secure transmission of confidential information,

- changes in, or insufficient availability of, telecommunications services
to support the Internet,

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- increasing interruptions in Internet service as result of outages,
cyber-vandalism and other delays occurring throughout the Internet network
infrastructure,

- failure of companies to meet their customers' expectations in delivering
goods and services over the Internet and

- increasing governmental regulation.

IF THE TREND TOWARD OUTSOURCING TELECOMMUNICATIONS NETWORK INFRASTRUCTURE
SERVICES DOES NOT CONTINUE, OUR REVENUES MAY BE NEGATIVELY IMPACTED.

Our growth strategy largely depends on the continued trend by our customers
to outsource their network infrastructure needs. If these companies elect to
perform more network deployment services themselves, our revenues may decline.

OUR INDUSTRY IS HIGHLY COMPETITIVE, AND POTENTIAL COMPETITORS FACE FEW BARRIERS
TO ENTRY. OUR INABILITY TO COMPETE SUCCESSFULLY COULD ADVERSELY AFFECT OUR
RESULTS OF OPERATIONS.

The industry in which we operate is highly competitive, and we compete with
other companies in all of the markets in which we operate. We also face
competition from existing or prospective customers who employ in-house personnel
to perform some of the same types of services that we provide. In addition,
relatively few significant barriers to entry exist in the markets in which we
operate, and as a result, any organization that has adequate financial resources
and access to technical expertise could also become one of our competitors. Some
of these existing and potential competitors have significantly greater
financial, technical and marketing resources, generate greater revenues and have
greater name recognition and experience than us.

We believe that the principal competitive factors in our markets include
pricing, quality and responsiveness of service, technical expertise, industry
experience, geographic diversity, reputation and the ability to deliver results
on time. From time to time, some of our smaller competitors are able to win bids
on smaller jobs based on price alone due to their low overhead costs. In
addition, expertise in new and evolving technologies has become increasingly
important.

We also believe our ability to compete depends on a number of factors beyond
our control, including:

- the prices at which others offer competitive services and

- the ability of our customers to perform the services themselves.

We may not be able to compete on these or other bases, and, as a result, our
revenues or income may decline. For more information, see
"Business--Competition."

OUR INDUSTRY IS LABOR INTENSIVE, AND IF WE CANNOT ATTRACT AND RETAIN QUALIFIED
EMPLOYEES WE MAY NOT BE ABLE TO IMPLEMENT OUR GROWTH STRATEGY.

Our industry is labor intensive. Some of our operations have experienced a
high rate of employee turnover and could continue to experience high turnover in
the future. Labor shortages, the inability to hire or retain qualified
employees, or increased labor costs could have a material adverse effect on our
ability to implement our growth strategy and efficiently conduct our operations.
The low unemployment rate in the United States has made it more difficult for us
to find qualified personnel at a low cost in some areas where we operate. As we
offer new services and pursue new customers and new markets we will also need to
increase our executive and support personnel. We cannot assure you that we will
be able to continue to hire and retain the sufficiently skilled labor force
necessary to operate efficiently and to support our growth strategy, that we
will continue to experience favorable labor relations or that our labor expenses
will not increase as a result of a continuing shortage in the supply of skilled
personnel.

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OUR OPERATIONS CAN BE HAZARDOUS AT TIMES. AN ACCIDENT, WHETHER CAUSED BY US OR
NOT, COULD DIVERT MANAGEMENT ATTENTION OR SUBJECT US TO LIABILITY FOR DAMAGES.

Performance of certain aspects of our network infrastructure services
requires the use of equipment and exposure to conditions that can be dangerous.
An accident could divert management attention, which may adversely affect our
results of operations. In addition, we may be subject to claims by employees,
third-parties and customers for property damage and personal injuries resulting
from the performance of our services. The primary claims we face in our
operations are workers' compensation, automobile liability and various general
liabilities. For more information about this issue, see "Business--Safety and
Insurance."

SOME CUSTOMERS MAY REQUIRE US TO POST A PERFORMANCE BOND. THE INABILITY TO POST
SUCH A BOND COULD RESULT IN LOST BUSINESS.

Contracts in the telecommunications, Internet, cable television and energy
industries may require performance bonds or other means of financial assurance
to secure contractual performance. If we are unable to obtain performance bonds
or letters of credit in sufficient amounts or at acceptable rates, we might be
precluded from entering into additional contracts with some of our current
customers or bidding on contracts from new customers, which could adversely
affect our revenues and net income.

STRIKES, WORK STOPPAGES AND SLOWDOWNS COULD NEGATIVELY AFFECT OUR RESULTS OF
OPERATIONS.

Some of our subsidiaries currently participate in union contracts
established through dates ranging from April 30, 2001 to May 31, 2003 covering
approximately 21% of our approximately 3,700 employees after giving effect to
the proposed Intercon acquisition. These contracts are typically negotiated on a
multi-employer basis. Consequently, we may have little or no control over the
terms and conditions of these agreements. We cannot assure you that our
relations with the unionized portion of our workforce will remain positive or
that it will not initiate a strike, work stoppage or slowdown in the future. In
the event of such an action, our business could be negatively affected and we
cannot assure you that we would be able to adequately meet the needs of our
customers utilizing our non-unionized workforce.

OUR INABILITY TO SECURE ADEQUATE SUPPLIES OF MATERIALS, INCLUDING FIBER OPTIC
CABLE, COULD ADVERSELY AFFECT OUR RESULTS OF OPERATIONS.

Our customers furnish us with most of the materials, including fiber optic
cable, for our network infrastructure services. We must obtain the rest from
third-party vendors. To maintain competitive operations, we must obtain, in a
timely manner, sufficient quantities of acceptable materials. From time to time,
we or our customers may experience extended lead times or limited supply of
required materials because of vendor capacity constraints, particularly with
respect to fiber optic cable. This could result in, among other things, delays
in completing projects. Our business, financial condition and results of
operations could be materially and adversely affected if our ability to obtain
sufficient quantities of materials and other supplies in a timely manner were
substantially diminished. See also "--We may encounter potential costs or claims
resulting from project performance, which could negatively affect our results of
operations."

MANY OF OUR CONTRACTS MAY BE CANCELED ON SHORT NOTICE, AND WE MAY BE
UNSUCCESSFUL IN REPLACING OUR CONTRACTS AS THEY ARE COMPLETED OR EXPIRE.

We could experience a material adverse effect on our revenue, net income and
liquidity if:

- our customers cancel a significant number of contracts,

- we fail to renew a significant number of our existing contracts upon their
expiration or

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- we complete the required work under a significant number of our
non-recurring projects and cannot replace them with similar projects.

Many of our customers may cancel our long-term contracts with them on short
notice, typically 90 to 180 days, even if we are not in default under the
contract. As a result, these contracts do not give us the assurances of future
revenue that long-term contracts typically provide. Many of our contracts,
including our master service agreements, are subject to bid at the expiration of
their terms and price is often an important factor in the award of these
agreements. We cannot assure you that we will be able to renew our existing
contracts upon their expiration. Moreover, our customers have no obligations
under our master service agreements to undertake any infrastructure projects or
other work with us. If we increase our personnel in anticipation of a project
and such project is delayed or does not occur, our operating expenses and
results of operations could be adversely affected. In addition, any significant
decline in the work our customers assign us under these master service
agreements could materially and adversely affect our revenue and net income. We
also provide a significant portion of our services on a non-recurring,
project-by-project basis, which, if not replaced by other such projects or
arrangements, may produce little or no revenue on a consistent basis.

WE MAY ENCOUNTER POTENTIAL COSTS OR CLAIMS RESULTING FROM PROJECT PERFORMANCE,
WHICH COULD NEGATIVELY AFFECT OUR RESULTS OF OPERATIONS.

Many of our engagements involve projects that are significant to the
operations of our customers' businesses. Our failure to meet a customer's
expectation in the planning or implementation of a project or the failure of
unrelated third-party vendors to meet project completion deadlines could damage
our reputation and adversely affect our ability to attract new business or
retain existing customers. We periodically undertake projects in which we
guarantee performance based upon defined operating specifications or guaranteed
delivery dates. Unsatisfactory performance or unanticipated difficulties or
delays in completing such projects may result in a direct reduction in payments
to us, or payment of damages by us, which could negatively affect our results of
operations.

SOME OF OUR REVENUES ARE ACCOUNTED FOR ON A PERCENTAGE OF COMPLETION BASIS,
WHICH COULD CAUSE OUR QUARTERLY RESULTS OF OPERATIONS TO FLUCTUATE.

Some of our revenue is earned from fixed price contracts, which are
accounted for on a percentage of completion basis. Under the percentage of
completion method, we recognize expenses as they are incurred and we recognize
revenue based on a comparison of the costs incurred for each project to our
currently estimated total costs to be incurred for the project. Accordingly, the
revenue we recognize in a given period depends on the costs we have incurred for
individual projects and our current estimate of the total remaining costs to
complete the individual projects. Purchase order price and cost estimates are
reviewed periodically as the work progresses, and adjustments proportionate to
the percentage of completion are reflected in the period in which such estimates
are revised. To the extent that these adjustments result in an increase in our
estimate of the total costs necessary to complete a project, we may recognize
very little or no additional revenue with respect to that project. As a result,
our gross margin in such period and future periods may be significantly reduced
and in some cases we may recognize a loss on individual projects prior to
completion.

OUR INDUSTRY IS SEASONAL AND SUBJECT TO SEVERE WEATHER CONDITIONS, EXPOSING US
TO REDUCED REVENUE, PARTICULARLY IN THE FIRST QUARTER OF EACH YEAR. AS A RESULT,
OUR QUARTERLY RESULTS MAY FLUCTUATE UNPREDICTABLY.

We often experience reduced revenue in the first quarter of each year
relative to other quarters, in part, because of year-end budgetary spending
patterns of some of our customers and adverse weather conditions, as the onset
of winter affects our ability to render external network services in many
regions. Prolonged extreme climate or weather conditions may cause unpredictable
fluctuations in our operating

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results, and as a result we may report results of operations that are different
than those expected by the investment community, which could cause our stock
price to fluctuate significantly.

WE ARE SUBJECT TO CYCLICAL VARIATIONS IN THE STATE OF THE ECONOMY.

Our business depends to a large extent on the overall level of investment
activities in the U.S. economy, particularly in the telecommunications, Internet
and cable television industries. The level of investment in these industries, in
turn, is dependent to a large extent on the overall state of the U.S. economy.
Cyclical variations in the U.S. economy can have a disproportionate impact on
our business, financial condition and results of operations.

OUR RESULTS OF OPERATIONS ARE SUBJECT TO SHORT TERM UNCERTAINTIES. AS A RESULT,
OUR QUARTERLY RESULTS MAY FLUCTUATE UNPREDICTABLY.

Our quarterly results may be materially affected by many factors, including:

- changes in customer purchasing patterns,

- variations in the margins of projects performed during any particular
quarter,

- regional economic conditions,

- aberrant weather conditions and

- the timing of acquisitions and magnitude of acquisition assimilation
costs.

Accordingly, our operating results in any particular quarter may not be
indicative of the results that you can expect for any other quarter or for the
entire year. We are not always able to predict the effects of these factors, and
as a result may report results of operations that are different than those
expected by the investment community, which could cause our stock price to
fluctuate significantly.

VARIOUS ASPECTS OF OUR WORK ARE SUBJECT TO GOVERNMENT REGULATION. IF WE ARE
UNABLE TO MANAGE THE IMPACT OF THAT REGULATION, OUR FINANCIAL PERFORMANCE COULD
SUFFER.

Our operations are subject to various federal, state and local laws and
regulations, including:

- licensing requirements,

- building and electrical codes,

- permitting and inspection requirements applicable to construction projects
and

- regulations relating to labor relations, worker safety and environmental
protection.

Any failure by us to comply with applicable rules and regulations could
result in substantial fines or revocation of the licenses or permits under which
we operate, which could, among other things, limit our ability to operate in
certain federal, state or local jurisdictions where we are not in compliance
with these rules and regulations.

In addition, many of our facilities and operations are subject to various
laws and regulations governing the handling and discharge of materials into the
environment or otherwise relating to environmental protection or occupational
health and safety. We cannot assure you that we have been or will be at all
times in complete compliance with such requirements. Any failure by us to comply
with these regulations could result in substantial civil and criminal penalties.
In addition, as a result of past and future operations at our facilities and
off-site waste disposal by our operations, we may incur environmental
remediation costs and other cleanup expenses. We cannot be certain that
indemnification will be available for all potential environmental liabilities
relating to any acquired business. For more information about this issue, see
"Business--Regulation and Environmental Matters."

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RISKS RELATING TO OUR COMPANY

OUR BUSINESS MAY BE ADVERSELY IMPACTED BY OUR SIGNIFICANT LEVERAGE, WHICH
REQUIRES THE USE OF A SUBSTANTIAL PORTION OF OUR EXCESS CASH FLOW AND MAY LIMIT
OUR ACCESS TO ADDITIONAL CAPITAL.

After this offering, we will continue to have a significant amount of debt,
and we are permitted to incur additional debt, subject to the conditions of our
outstanding indebtedness. Our substantial debt could have important consequences
to you. For example, it could:

- increase our vulnerability to adverse economic and industry conditions by
limiting our flexibility in reacting to changes in our business and
industry,

- reduce our cash flow to fund working capital, capital expenditures and
other general corporate purposes,

- place us at a competitive disadvantage compared to our competitors that
have less leverage and

- limit our ability to borrow additional funds and increase the cost of
funds that we can borrow.

OUR SENIOR CREDIT FACILITY COULD BE ACCELERATED IF WE DEFAULT AND COULD ALSO
PREVENT US FROM ENGAGING IN OTHERWISE BENEFICIAL TRANSACTIONS.

We have a senior credit facility with a syndicate of financial institutions.
This agreement contains customary events of default and restrictive covenants,
including those with respect to the maintenance of certain financial ratios. If
we breach any of these covenants, we will be in default under our senior credit
facility. A default could accelerate the repayment of this indebtedness.

In addition, these covenants may significantly restrict our ability to
respond to changing business and economic conditions or to secure additional
financing, if needed, and may prevent us from engaging in transactions that
might otherwise be considered beneficial to us. These restrictive covenants
limit our ability to, among other things:

- make investments,

- incur additional indebtedness,

- pay dividends,

- make capital expenditures,

- engage in mergers or other business combinations and

- engage in transactions which would result in a "change of control" of our
company.

Covenants in our senior credit facility also require us to use 50% of the
proceeds we receive in specified debt or equity issuances to repay outstanding
principal.

OUR BUSINESS OPERATIONS COULD BE SIGNIFICANTLY DISRUPTED IF WE LOST MEMBERS OF
OUR MANAGEMENT TEAM.

Our success depends to a significant degree upon the continued contributions
of our executive officers and key employees, both individually and as a group.
Our future performance will be substantially dependent on our ability to retain
and motivate them. The loss of the services of any of our executive officers or
key employees, particularly our president and chief executive officer, Ismael
Perera, could prevent us from executing our business strategy. We are the named
beneficiary under a key-man life insurance policy for Mr. Perera in the amount
of $3.0 million. See "Management--Directors, Executive Officers and Key
Employees."

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OUR LARGEST CUSTOMERS HAVE HISTORICALLY ACCOUNTED FOR A SIGNIFICANT PORTION OF
OUR REVENUES. ACCORDINGLY, OUR BUSINESS MAY BE ADVERSELY AFFECTED BY THE LOSS
OF, OR REDUCED PURCHASES BY, ONE OR MORE OF OUR LARGE CUSTOMERS.

During the pro forma six months ended June 30, 2000, sales to Level 3
Communications, Consolidated Edison and Williams Communications accounted for
approximately 11%, 8% and 7% of our net revenue, and sales to our top ten
customers in the aggregate accounted for approximately 56% of our net revenue.
If, for any reason, one of our key customers were to purchase significantly less
of our services in the future, and we are not able to sell our services to new
customers at comparable or greater levels, it could have a material adverse
effect on our business, financial condition and results of operations. As the
telecommunications, Internet and cable television industries converge and
consolidate because of deregulation and other factors and current and potential
customers seek to establish closer relationships with their infrastructure
service providers, we expect that our customer concentration will continue at
current levels or increase. In addition, the amount and type of work we perform
at any given time and the general mix of customers for which we perform work can
vary significantly from quarter to quarter, affecting our quarterly results. For
more information, see "Business--Customers."

IF WE ARE UNABLE TO EXPAND OUR INFRASTRUCTURE, WE MAY NOT BE SUCCESSFUL IN
MANAGING OUR RAPID GROWTH.

To manage our growth effectively, we may need to continuously enhance our
information systems and our operational and financial systems and controls. Our
anticipated growth could significantly strain our operational infrastructure and
financial resources. Our growth plan may be adversely affected if we are unable
to expand and continuously improve our operational infrastructure.

OUR DECENTRALIZED OPERATING STRATEGY COULD RESULT IN INCONSISTENT OPERATING
PRACTICES THROUGHOUT OUR ORGANIZATION, WHICH COULD ADVERSELY AFFECT OUR OVERALL
PROFITABILITY.

We intend to operate our business on a decentralized basis, with local
management retaining responsibility for day-to-day operations, profitability and
growth. If we do not implement proper overall business practices and controls,
this decentralized operating strategy could result in inconsistent operating and
financial practices throughout our organization, and our overall profitability
could be adversely affected.

IN THE EVENT WE ARE UNABLE TO COMPLETE THE INTERCON ACQUISITION, SOME OF THE
INFORMATION AND FINANCIAL DATA CONTAINED IN THIS PROSPECTUS WILL NOT BE RELEVANT
TO YOU.

On August 31, 2000, we agreed to acquire all of the outstanding capital
stock of Intercon. We expect to complete the acquisition of Intercon prior to
the completion of this offering. Some of the information contained in this
prospectus assumes that the acquisition of Intercon will be completed on the
terms set forth in the Intercon purchase agreement. If the acquisition of
Intercon is not completed, the shares of common stock offered hereby would
represent an ownership interest in Linc.net as it exists on the date of this
prospectus and not of Linc.net as combined with Intercon. Therefore, if the
acquisition of Intercon is not completed, the information contained in this
prospectus that gives effect to such acquisition would not be relevant.

WE MAY HAVE DIFFICULTY IDENTIFYING, FINANCING AND MANAGING ACQUISITIONS, WHICH
COULD INHIBIT OUR GROWTH.

We have grown rapidly by acquiring other companies, and our growth strategy
provides for additional selected acquisitions. Increased competition for
acquisition candidates may raise prices for these targets and lengthen the time
period required to recoup our investment. Our acquisition strategy incorporates
the risks inherent in assessing the value, strengths and weaknesses of growth
opportunities and evaluating the costs and uncertain returns of expanding our
operations.

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We may be unable to continue to identify and acquire appropriate businesses
on favorable terms or at all, or obtain financing for acquisitions, including
the proposed Intercon acquisition, on favorable terms if at all. In addition,
the companies we acquire may not perform as we expect.

Our acquisitions would also result in one or more of the following:

- the issuance of additional shares of our capital stock, which could dilute
our existing stockholders,

- an increase in our indebtedness, which could require us to agree to
restrictive covenants that might limit our operational and financial
flexibility,

- using our cash, which would reduce the funds we have available for other
corporate purposes or

- increased amortization expense from goodwill and other intangibles, which
would decrease our net income.

Any difficulties we encounter in managing the businesses we acquire or
liabilities associated with one of our acquired businesses that we may not have
discovered could have a material adverse effect on our operating results or
financial condition. The management of acquired businesses involves a number of
risks, including:

- diversion of management's attention,

- difficulty absorbing acquired businesses, their employees, corporate
culture, managerial systems and processes and services,

- failure to retain key personnel and employee turnover and

- other unanticipated events or circumstances.

RISKS RELATED TO THIS OFFERING

WE ARE CONTROLLED BY TWO STOCKHOLDERS WHO CAN EFFECTIVELY DICTATE OUR MANAGEMENT
AND POLICIES AND WHO COULD PREVENT AN OTHERWISE BENEFICIAL TAKEOVER ATTEMPT.

Upon the completion of this offering, and assuming the underwriters do not
exercise their over-allotment option, affiliates of Banc One Equity Capital,
formerly known as First Chicago Equity Capital, will own approximately % of
our common stock, and affiliates of Saunders Karp & Megrue, L.P., or SKM, will
own approximately % of our common stock and be parties to a stockholders
agreement pursuant to which they will coordinate their vote with respect to the
election of directors. Accordingly, they will remain in a position to
effectively:

- control the vote of most matters submitted to our stockholders, including
any merger, consolidation or sale of all or substantially all of our
assets,

- elect all of the members of our board of directors,

- prevent or cause a change in our control and

- decide whether we will issue additional common stock or other securities
or declare dividends.

These stockholders may therefore prevent transactions that might otherwise
allow other stockholders to receive a premium for their shares over their
current prices. For additional information regarding our stock ownership, see
"Principal Stockholders."

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PROVISIONS OF OUR CHARTER DOCUMENTS, DELAWARE LAW AND OUR SENIOR CREDIT FACILITY
COULD DISCOURAGE POTENTIAL ACQUISITION PROPOSALS AND COULD DELAY, DETER OR
PREVENT A CHANGE IN CONTROL.

Various provisions of our certificate of incorporation and by-laws may
inhibit changes in control of Linc.net not approved by our board of directors,
which may limit the circumstances in which a premium may be paid for the common
stock in proposed transactions or a proxy contest for control of the board may
be initiated. These provisions may have a negative impact on the price of our
common stock. These provisions include:

- a classified board of directors,

- a prohibition on stockholder action through written consents,

- a requirement that special meetings of stockholders be called only by the
board of directors,

- advance notice requirements for stockholder proposals and nominations,

- limitations on the ability of stockholders to amend, alter or repeal the
by-laws,

- the authority of the board to issue, without stockholder approval,
preferred stock with such terms as the board may determine and

- the authority of the compensation and organization committee of our board
of directors to declare options to purchase our common stock fully vested
and exercisable upon a change of control of Linc.net.

We will also be subject to certain provisions of Delaware law which could
have similar effects, including Section 203 of the Delaware General Corporation
Law, which could prohibit us from engaging in a business combination with an
interested stockholder unless specific conditions are met. For additional
information regarding this issue, see "Description of Capital Stock." In
addition, our senior credit facility contains customary events of default which
include a change of control of Linc.net. These provisions could also discourage
potential acquisition proposals and could delay, deter or prevent a change of
control that our stockholders may find beneficial.

TRADING IN OUR SHARES COULD BE SUBJECT TO EXTREME PRICE FLUCTUATIONS.

The market for our shares may be subject to extreme price and volume
fluctuations. We believe that a number of factors, both within and outside our
control, could cause the price of our common stock to fluctuate, perhaps
substantially. These factors include, but are not limited to:

- announcements of developments related to our business or our competitors'
or customers' businesses,

- fluctuations in our financial results,

- general conditions or developments in the telecommunications, Internet,
cable television and energy industries,

- potential sales of our common stock into the marketplace by Linc.net or
our stockholders,

- announcements of technological innovations or new or enhanced services by
us or our competitors or customers,

- a shortfall in revenue, gross margin, earnings or other financial results
or changes in research analysts' expectations and

- the limited number of shares of our common stock traded on a daily basis.

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We cannot be certain that the market price of our common stock will not
experience significant fluctuations in the future, including fluctuations that
are material, adverse and unrelated to our operating performance.

THE ABSENCE OF A PUBLIC MARKET FOR OUR COMMON STOCK CREATES UNCERTAINTY IN THE
MARKET PRICE.

Prior to this offering, you could not buy or sell our common stock publicly.
We will negotiate and determine the initial public offering price with the
representatives of the underwriters based on several factors, including:

- prevailing market conditions,

- our historical performance,

- estimates of our business potential and earnings prospects,

- an assessment of our management and

- consideration of the above factors in relation to the market value of
companies in related businesses.

The negotiated initial public offering price may not accurately reflect the
true market value of Linc.net and the trading price of our common stock may
decline below the initial public offering price.

YOU MAY NOT BE ABLE TO RESELL YOUR COMMON STOCK OR MAY HAVE TO SELL IT AT A
DISCOUNT, IF AN ACTIVE TRADING MARKET IS NOT DEVELOPED AND MAINTAINED.

No public market currently exists for our common stock. Although we expect
our common stock to be approved for listing on the New York Stock Exchange, a
liquid market for the common stock may not develop or be maintained. As a
result, you may not be able to sell your shares of common stock or may have to
sell them at a discount.

BECAUSE YOU WILL PAY MORE FOR YOUR SHARES THAN OUR EXISTING STOCKHOLDERS, THE
VALUE OF YOUR INVESTMENT IN OUR COMMON STOCK WILL BE DILUTED.

If you purchase our common stock in this offering, you will pay more for
your shares than the amount paid by our existing stockholders. As a result, the
value of your investment based on the value of our net tangible assets will be
less than the amount you pay for your shares of our common stock in this
offering. In addition, the total amount of our capital will be less than what it
would have been had you and all of the existing stockholders paid the same
amount per share of our common stock as you will pay in this offering. The
dilution you will immediately suffer will be $ per share in the net tangible
book value of the common stock from the initial public offering price. You may
experience further dilution to the extent that additional shares of our common
stock are sold by the underwriters following exercise of their over-allotment
option, or if additional shares are issued upon the exercise of stock options.
For more information, see "Dilution."

FUTURE SALES BY OUR EXISTING STOCKHOLDERS COULD ADVERSELY AFFECT THE MARKET
PRICE OF OUR COMMON STOCK.

Future sales of the shares of common stock held by existing stockholders
could have a material adverse effect on the price of the common stock. Upon
completion of this offering, we expect that:

- the shares of common stock ( shares if the underwriters'
over-allotment option is exercised in full) sold in this offering will be
freely tradeable without restriction under the Securities Act, except any
such shares which may be acquired by an "affiliate" of Linc.net and

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- shares of common stock held by our existing stockholders will be
eligible for sale in the public market, subject to compliance with the
resale volume limitations and other restrictions of Rule 144 under the
Securities Act, beginning 180 days or more after the date of this
prospectus.

Beginning 180 days after the completion of this offering, the holders of an
aggregate of approximately shares of common stock will have certain rights
to require us to register their shares of common stock under the Securities Act
at our expense.

After this offering we also intend to register up to approximately
additional shares of our common stock issued or issuable upon the exercise of
stock options granted or subject to grant under our stock option and long-term
equity incentive plans. See "Shares Eligible for Future Sale."

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CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS

We make statements in this prospectus that are forward-looking, including
statements regarding our future growth and profitability, our competitive
strengths and business strategy and the trends we anticipate in the industries
and economies in which we operate. These forward-looking statements are based on
our current expectations and are subject to a number of risks, uncertainties and
assumptions relating to:

- our ability to complete the proposed Intercon acquisition,

- our business, financial condition and results of operations,

- the financial resources of our customers and their ability to obtain
capital for network infrastructure outlays,

- our ability to expand our infrastructure and manage our growth,

- rapid technological and regulatory changes affecting demand for our
services,

- sustained growth in the use of the Internet,

- the trend toward outsourcing network infrastructure services,

- our numerous competitors and the few barriers to entry in the markets in
which we operate,

- our ability to attract and retain qualified employees,

- strikes, work stoppages and slowdowns by our employees,

- our ability to obtain adequate quantities of materials,

- government regulations in connection with our operations,

- our substantial leverage and restrictions imposed by our senior credit
facility,

- our ability to issue stock-based compensation to our employees without
incurring an accounting charge consistent with existing accounting rules,

- the short-term nature of many of our contracts and

- our ability to identify, finance and manage acquired businesses.

If any of these risks or uncertainties materialize, or if any of our
underlying assumptions are incorrect, our actual results may differ
significantly from the results that we express in or imply by any of our
forward-looking statements. These and other risks are detailed in the section
entitled "Risk Factors" and elsewhere in this prospectus. We do not undertake
any obligation to revise these forward-looking statements to reflect future
events or circumstances.

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USE OF PROCEEDS

We estimate that the net proceeds from our sale of shares of common stock in
this offering will be approximately $ million, assuming an initial public
offering price of $ per share, the midpoint of the range set forth on the
cover page of this prospectus, and after deducting underwriting discounts and
commissions and estimated offering expenses payable by us. If the underwriters'
over-allotment option is exercised in full, we estimate that the net proceeds
from this offering will be approximately $ million.

We are required to use 50% of the proceeds we receive in this offering to
pay down our indebtedness under our senior credit facility. The remainder of the
proceeds will be used for general corporate purposes, including for working
capital and strategic acquisitions. Amounts used to repay indebtedness will be
applied ratably to the following term loans outstanding under such facility:

- Term Loan A, which matures in quarterly installments from March 2001
through 2005, with a current interest rate of 10.12% and approximately
$96.3 million outstanding as of September 6, 2000; and

- Term Loan B, which matures in quarterly installments from June 2000
through March 2007, with a current interest rate of 10.62% and
approximately $99.8 million outstanding as of September 6, 2000.

Covenants in our senior credit facility require us to use 50% of the
proceeds we receive in specified debt or equity issuances to repay outstanding
principal. For more information about our senior credit facility, see
"Description of Certain Indebtedness."

DIVIDEND POLICY

We have not declared or paid any cash dividends on our common stock. We
currently intend to retain future earnings, if any, to finance the expansion of
our business. As a result, we do not intend to pay cash dividends in the
foreseeable future. We are also currently restricted in our ability to declare
and pay dividends by the terms of our senior credit facility. We cannot assure
you that we will not become subject to further restrictions by the terms of any
credit facility or other financial instrument that we elect to enter into from
time to time in the future.

22
<PAGE>
CAPITALIZATION

The following table sets forth our cash and cash equivalents, short-term
debt and total capitalization as of June 30, 2000:

- on an actual basis,

- on a pro forma basis to reflect the acquisitions, including the proposed
Intercon acquisition, described under "Unaudited Pro Forma Condensed
Consolidated Financial Statements" and

- on a pro forma, as adjusted basis to reflect the acquisitions, including
the proposed Intercon acquisition, described under "Unaudited Pro Forma
Condensed Consolidated Financial Statements," the reclassification of all
of our capital stock into a single class of common stock and the sale by
us of shares of common stock in this offering, assuming an offering
price of $ per share, the midpoint of the range set forth on the cover
page of this prospectus, and the application of the net proceeds as
described under "Use of Proceeds."

This table should be read in conjunction with "Selected Historical Financial
Data," "Unaudited Pro Forma Condensed Consolidated Financial Statements," our
financial statements and related notes and other financial information appearing
elsewhere in this prospectus.

<TABLE>
<CAPTION>
AS OF JUNE 30, 2000
----------------------------------
PRO FORMA,
ACTUAL PRO FORMA AS ADJUSTED
-------- --------- -----------
(DOLLARS IN THOUSANDS)
<S> <C> <C> <C>
Cash and cash equivalents................................... $ 3,233 $ 5,265 $ 5,265
======== ======== ========
Short-term debt and capital lease obligations............... 12,764 12,881
======== ======== ========
Long-term debt and capital lease obligations................ 131,500 223,557
Preferred Stock:
Preferred Stock, $0.01 par value, shares authorized;
no shares issued or outstanding on an actual and as
adjusted basis.......................................... -- -- --
Series A Mandatorily Redeemable Preferred Stock, $0.01 par
value, 125,000 shares authorized; 75,915 shares issued
and outstanding on an actual basis; 121,434 shares
issued and outstanding on a pro forma basis; and no
shares authorized, issued and outstanding on a pro
forma, as adjusted basis................................ 78,807 130,616 --
Stockholders' equity:
Common Stock, $0.01 par value, 1,500,000 shares authorized
on an actual and pro forma basis; shares
authorized on a pro forma, as adjusted basis;
907,505 shares issued and outstanding on an actual
basis; 1,421,162 shares issued and outstanding on a pro
forma basis; and shares issued and outstanding on
a pro forma, as adjusted basis.......................... 9 15
Series B Redeemable Preferred Stock, $0.01 par value,
25,000 shares authorized; 5,760 shares issued and
outstanding on an actual and pro forma basis; and no
shares authorized, issued and outstanding on a pro
forma, as adjusted basis................................ 5,919 5,919 --
Additional paid-in capital................................ 9,066 14,884
Accumulated deficit....................................... (3,313) (3,313) (3,313)
Stockholders' loans....................................... (228) (228) (228)
Excess of purchase price over predecessor basis........... (2,490) (2,490) (2,490)
-------- -------- --------
Total stockholders' equity............................ 8,963 14,787
-------- -------- --------
Total capitalization................................ $219,270 $368,960 $
======== ======== ========
</TABLE>

Shares of our common stock outstanding on a pro forma, as adjusted basis
after this offering do not include:

- shares issuable upon the exercise of outstanding options granted
under our existing stock option and long-term equity incentive plans,
of which were then exercisable,

- additional shares reserved for future grants, awards or sales under
our long-term equity incentive plan, and

- additional shares reserved for sale under our employee stock
purchase plan.

23
<PAGE>
DILUTION

Our pro forma net tangible book deficit as of June 30, 2000 was
$ million, or $ per share of common stock. "Pro forma net tangible book
deficit" per share is determined by dividing the tangible net capital deficiency
of Linc.net, or total assets less intangible assets and total liabilities, by
the aggregate number of shares of common stock outstanding, on a pro forma basis
to reflect the acquisitions, including the proposed Intercon acquisition,
described under "Unaudited Pro Forma Condensed Consolidated Financial
Statements" and assuming the reclassification of our capital stock had taken
place on June 30, 2000. After giving effect to the sale of the shares of common
stock offered hereby, at an assumed offering price of $ per share, the
midpoint of the range set forth on the cover page of this prospectus, and the
receipt and application of the net proceeds, and after deducting estimated
underwriting discounts and expenses, pro forma net tangible book value as of
June 30, 2000 would have been approximately $ million, or $ per share.
This represents an immediate increase in pro forma net tangible book value of
$ per share to the existing stockholders and an immediate dilution in pro
forma net tangible book value of $ per share to purchasers of common stock in
this offering at the initial public offering price. The following table
illustrates this per share dilution:

<TABLE>
<S> <C> <C>
Assumed initial public offering price per share............. $
Pro forma net tangible book deficit per share at June 30,
2000.................................................... $
----------
Increase in pro forma net tangible book value per share
attributable to new investors...........................
Pro forma net tangible book deficit per share after this
offering..................................................
----------
Dilution per share to new investors......................... $
==========
</TABLE>

Dilution per share to new investors is determined by subtracting pro forma
net tangible book deficit per share after this offering from the initial public
offering price per share. If any shares are issued in connection with
outstanding options or the underwriters' over-allotment option, you will
experience further dilution.

The following table summarizes, on a pro forma basis, as of June 30, 2000,
the number of shares purchased, the total consideration paid, or to be paid, and
the average price per share paid, or to be paid, by the existing stockholders
and the purchasers of common stock in this offering, at an assumed offering
price of $ per share, the midpoint of the range set forth on the cover page
of this prospectus, before deducting the estimated offering expenses and
underwriting discounts and commissions:

<TABLE>
<CAPTION>
SHARES TOTAL
PURCHASED CONSIDERATION AVERAGE
------------------- ------------------- PRICE
NUMBER PERCENT AMOUNT PERCENT PER SHARE
-------- -------- -------- -------- ---------
<S> <C> <C> <C> <C> <C>
Existing stockholders.............................. % $ % $
New investors...................................... $
------ ----- ------ -----
Total............................................ 100.0% $ 100.0%
====== ===== ====== =====
</TABLE>

The number of shares outstanding above excludes an aggregate of shares
of common stock issuable upon the exercise of outstanding options granted under
our existing stock option plan as of June 30, 2000, of which were then
exercisable, at an exercise price of $ per share, additional shares
reserved for future grants, awards or sales under our long-term equity incentive
plan and additional shares reserved for sale under our employee stock
purchase plan.

24
<PAGE>
SELECTED HISTORICAL FINANCIAL DATA

The following table shows selected consolidated financial data for the
periods and as of the dates indicated.

We were formed in October 1999. We acquired M&P on December 21, 1999. M&P is
our corporate predecessor for accounting purposes and, therefore, its historical
financial statements are deemed to be our historical financial statements. The
following selected historical financial data for our predecessor, M&P, for the
years ended December 31, 1997 and 1998 and the period from January 1, 1999 to
December 21, 1999 and as of December 31, 1998 and 1999 have been derived from
M&P's audited financial statements and notes thereto, which are included
elsewhere in this prospectus. The selected historical financial data for M&P for
the years ended December 31, 1995 and 1996 and as of December 31, 1995, 1996 and
1997 are derived from M&P's accounting records and are unaudited. Data for M&P
as of and for the six months ended June 30, 1999 are derived from M&P's
accounting records and are unaudited.

The selected historical financial data as of and for the six months ended
June 30, 2000 were derived from our unaudited condensed consolidated financial
statements which, in the opinion of management, have been prepared on the same
basis as our audited financial statements and reflect all adjustments
(consisting of normal recurring adjustments) necessary for the fair presentation
of the financial condition and results of operations for such periods. The
selected historical financial data set forth below is not necessarily indicative
of the results of future operations and should be read in conjunction with
"Management's Discussion and Analysis of Financial Condition and Results of
Operations" and our financial statements and related notes and other financial
information appearing elsewhere in this prospectus.

25
<PAGE>

<TABLE>
<CAPTION>
PERIOD FROM PERIOD FROM
JANUARY 1, OCTOBER 19, SIX MONTHS ENDED
YEAR ENDED DECEMBER 31, 1999 TO 1999 TO JUNE 30,
----------------------------------------- DECEMBER 21, DECEMBER 31, ----------------------
1995 1996 1997 1998 1999 1999 1999 2000
-------- -------- -------- -------- ------------ ------------- ----------- --------
(DOLLARS IN THOUSANDS, EXCEPT SHARE DATA)
<S> <C> <C> <C> <C> <C> <C> <C> <C>
STATEMENT OF OPERATIONS DATA:
Net revenue................... $14,420 $17,401 $22,652 $28,900 $43,916 $ 1,760 $16,800 $ 67,717
Costs of sales................ 12,325 13,860 16,408 22,672 32,701 1,581 12,862 55,647
------- ------- ------- ------- ------- -------- ------- --------
Gross profit.................. 2,095 3,541 6,244 6,228 11,215 179 3,938 12,070
Costs and expenses:
General and administrative
expenses.................... 1,136 817 1,343 1,446 1,781 868 786 6,395
Amortization of goodwill...... -- -- -- -- -- 107 -- 2,124
Management fees............... -- -- -- -- -- 250 -- 500
------- ------- ------- ------- ------- -------- ------- --------
Income (loss) from
operations.................. 959 2,724 4,901 4,782 9,434 (1,046) 3,152 3,051
Other (income) expenses:
Interest (income) expense,
net......................... 33 68 81 (39) (63) 360 (54) 5,093
Transaction-related
expenses.................... -- -- -- -- 4,485 -- -- --
Other (income) expense, net... 1 (71) (153) (1) 31 (47) (10) (64)
------- ------- ------- ------- ------- -------- ------- --------
Income (loss) before income
taxes and equity in income
of investee................. 925 2,727 4,973 4,822 4,981 (1,359) 3,216 (1,978)
Equity in income of
investee.................... -- -- -- -- -- -- -- 1,754
------- ------- ------- ------- ------- -------- ------- --------
Income (loss) before income
taxes....................... 925 2,727 4,973 4,822 4,981 (1,359) 3,216 (224)
Income taxes.................. 9 7 5 51 71 (529) 2 (791)
------- ------- ------- ------- ------- -------- ------- --------
Net income (loss)............. 916 2,720 4,968 4,771 4,910 (830) 3,214 567
Preferred stock dividends..... -- -- -- -- -- (252) -- (2,798)
------- ------- ------- ------- ------- -------- ------- --------
Net income (loss) to common
stockholders................ $ 916 $ 2,720 $ 4,968 $ 4,771 $ 4,910 $ (1,082) $ 3,214 $ (2,231)
======= ======= ======= ======= ======= ======== ======= ========
Net (loss) per share:
Basic....................... $ (7.51) $ (4.02)
Diluted..................... (7.51) (4.02)
Weighted average common shares
outstanding:
Basic....................... 143,954 555,663
Diluted..................... 143,954 555,663

BALANCE SHEET DATA (AT PERIOD
END):
Working capital............... $ 3,418 $ 3,650 $ 5,239 $ 6,693 $ 4,410 $ 10,192 $ 6,019 $ 42,628
Total assets.................. 7,796 10,406 13,062 15,041 21,829 110,476 11,345 256,613
Long-term debt and capital
lease obligations........... 289 -- -- -- 463 53,213 -- 131,500
Stockholders' equity.......... 7,018 8,357 11,011 13,021 10,663 569 10,007 3,044
</TABLE>

26
<PAGE>
UNAUDITED PRO FORMA CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

We prepared the following Unaudited Pro Forma Condensed Consolidated
Financial Statements as of and for the year ended December 31, 1999 and as of
and for the six months ended June 30, 2000 and 1999 to illustrate:

- the acquisitions, including the proposed Intercon acquisition, described
in Note 1 to the "Notes to the Unaudited Pro Forma Condensed Consolidated
Statements of Operations,"

- the reclassification of all of our outstanding capital stock into a single
class of common stock and

- the sale of common stock by us in this offering and our use of the
proceeds to repay debt.

The Unaudited Pro Forma Condensed Consolidated Statements of Operations is
presented as if these transactions had occurred at the beginning of each period
presented, to the extent not included in Linc.net's historical consolidated
balance sheet. The Unaudited Pro Forma Condensed Consolidated Balance Sheet is
presented as if these transactions had occurred on the date presented. We
believe that the assumptions used provide a reasonable basis for presenting the
significant effects directly attributable to this offering and the other
transactions described above. The Unaudited Pro Forma Condensed Consolidated
Financial Statements do not purport to represent what our results of operations
or financial position would actually have been if these transactions had in fact
occurred on such dates or to project our results of operations or financial
position for any future period or date. These statements should be read in
connection with, and are qualified by reference to, "Management's Discussion and
Analysis of Financial Condition and Results of Operations" and the financial
statements and related notes included elsewhere in this prospectus.

The acquisitions, including the proposed Intercon acquisition, described in
Note 1 to the "Notes to the Unaudited Pro Forma Condensed Consolidated
Statements of Operations" will be accounted for using the purchase method of
accounting. The total cost of such acquisitions will be allocated to the
tangible and intangible assets acquired and liabilities assumed based upon their
respective fair values as of the time each such acquisition was consummated. The
excess of purchase cost over the historical basis of the net assets acquired
(goodwill) has been allocated in the accompanying "Unaudited Pro Forma Condensed
Consolidated Financial Statements" based upon preliminary estimates. These
estimates are based upon available information and upon certain assumptions that
management believes are reasonable.

Linc.net intends to finance the proposed Intercon acquisition through a
combination of borrowings, and the issuance of Series A mandatorily redeemable
preferred stock and common stock. However, there can be no assurance that
Linc.net will be able to obtain financing for the acquisition on favorable terms
if at all or that the acquisition of Intercon will be completed on the terms set
forth in the Intercon purchase agreement.

27
<PAGE>
UNAUDITED PRO FORMA CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS

YEAR ENDED DECEMBER 31, 1999

<TABLE>
<CAPTION>
COMBINED PRO FORMA OFFERING PRO FORMA,
HISTORICAL(1)(2) ADJUSTMENTS PRO FORMA ADJUSTMENTS AS ADJUSTED
---------------- ----------- --------- ----------- -----------
(IN THOUSANDS, EXCEPT SHARE DATA)
<S> <C> <C> <C> <C> <C>
Net revenue.................... $461,039 $(39,734)(3) $421,305
Costs of sales................. 390,955 (41,969)(3)(4) 348,986
-------- -------- --------
Gross profit................... 70,084 2,235 72,319
Costs and expenses:
General and administrative
expenses..................... 33,989 (1,490)(4) 32,499
Amortization of goodwill....... 136 13,328 (5) 13,464
Management fees................ 250 -- 250
Noncash stock compensation..... 560 -- 560
-------- -------- --------
Income from operations......... 35,149 (9,603) 25,546
Other (income) expenses:
Interest expense, net.......... 3,976 20,574 (6) 24,550
Transaction-related expenses... 7,700 (7,700)(4) --
Other (income) expense, net.... (430) -- (430)
-------- -------- --------
Income before income taxes..... 23,903 (22,477) 1,426
Income taxes................... 1,522 (966)(7) 556
-------- -------- --------
Net income..................... 22,381 (21,511) 870
Preferred stock dividends...... (252) (12,535)(8) (12,787)
-------- -------- --------
Net income (loss) to common
stockholders................. $ 22,129 $(34,046) $(11,917)
======== ======== ========
Net (loss) per share:
Basic........................ $ (8.39)
Diluted...................... (8.39)
Weighted average common shares
outstanding:
Basic........................ 1,419,619
Diluted...................... 1,419,619

OTHER FINANCIAL DATA:
EBITDA......................... $ 36,714 $ 11,425 $ 48,139
Depreciation................... 8,699 -- 8,699
Amortization................... 136 13,328 13,464
</TABLE>

28
<PAGE>
UNAUDITED PRO FORMA CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS

SIX MONTHS ENDED JUNE 30, 1999

<TABLE>
<CAPTION>
COMBINED PRO FORMA OFFERING PRO FORMA,
HISTORICAL(1)(2) ADJUSTMENTS PRO FORMA ADJUSTMENTS AS ADJUSTED
---------------- ----------- --------- ----------- -----------
(IN THOUSANDS, EXCEPT SHARE DATA)
<S> <C> <C> <C> <C> <C>
Net revenue.................... $213,722 $(25,107)(3) $188,615
Costs of sales................. 183,938 (26,481)(3)(4) 157,457
-------- -------- --------
Gross profit................... 29,784 1,374 31,158
Costs and expenses:
General and administrative
expenses..................... 16,994 (916)(4) 16,078
Amortization of goodwill....... -- 6,732 (5) 6,732
Noncash stock compensation..... 560 -- 560
-------- -------- --------
Income from operations......... 12,230 (4,442) 7,788
Other (income) expenses:
Interest expense, net.......... 1,295 10,980 (6) 12,275
Other (income) expense, net.... (133) -- (133)
-------- -------- --------
Income (loss) before income
taxes........................ 11,068 (15,422) (4,354)
Income taxes................... 1,586 (3,284)(7) (1,698)
-------- -------- --------
Net income (loss).............. 9,482 (12,138) (2,656)
Preferred stock dividends...... -- (6,394)(8) (6,394)
-------- -------- --------
Net income (loss) to common
stockholders................. $ 9,482 $(18,532) $ (9,050)
======== ======== ========

Net (loss) per share:
Basic........................ $ (6.37)
Diluted...................... (6.37)
Weighted average common shares
outstanding:
Basic........................ 1,419,619
Diluted...................... 1,419,619

OTHER FINANCIAL DATA:
EBITDA......................... $ 16,535 $ 2,290 $ 18,825
Depreciation................... 4,172 -- 4,172
Amortization................... -- 6,732 6,732
</TABLE>

29
<PAGE>
UNAUDITED PRO FORMA CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS
SIX MONTHS ENDED JUNE 30, 2000

Costs of sales................. 301,174 (77,855)(3)(4) 223,319
-------- -------- --------
Gross profit................... 49,106 502 49,608
Costs and expenses:
General and administrative
expenses..................... 16,446 (335)(4) 16,111
Amortization of goodwill....... 2,124 4,608 (5) 6,732
Management fees................ 500 -- 500
-------- -------- --------
Income from operations......... 30,036 (3,771) 26,265
Other (income) expenses:
Interest expense, net.......... 6,846 5,429 (6) 12,275
Other (income) expense, net.... (202) -- (202)
-------- -------- --------
Income before income taxes and
equity in income of
investee..................... 23,392 (9,200) 14,192
Equity in income of investee... 1,754 (1,754)(3) --
-------- -------- --------
Income before income taxes..... 25,146 (10,954) 14,192
Income taxes................... 1,913 3,621 (7) 5,534
-------- -------- --------
Net income..................... 23,233 (14,575) 8,658
Preferred stock dividends...... (2,798) (3,596)(8) (6,394)
-------- -------- --------
Net income to common
stockholders................. $ 20,435 $(18,171) $ 2,264
======== ======== ========

Net income per share:
Basic........................ $ 1.59
Diluted...................... 1.59
Weighted average common shares
outstanding:
Basic........................ 1,419,619
Diluted...................... 1,419,619

OTHER FINANCIAL DATA:
EBITDA......................... $ 40,272 $ (917) $ 39,355
Depreciation................... 6,156 -- 6,156
Amortization................... 2,124 4,608 6,732
</TABLE>

30
<PAGE>
NOTES TO UNAUDITED PRO FORMA
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

FOR THE YEAR ENDED DECEMBER 31, 1999 AND THE SIX MONTHS ENDED JUNE 30, 1999 AND
2000

(IN THOUSANDS)

(1) The combined historical data gives pro forma effect to the acquisition of:
Capital Land Services, Inc. ("CLS"); M&P Utilities, Inc. and its affiliate
Muller & Pribyl Utilities, Inc. (collectively, "M&P"); C&B Associates
II, Ltd. and its affiliate C&B Associates, Ltd. (collectively, "C&B"); North
Shore Cable Contractors, Inc. ("NSC"); Telpro Technologies, Inc. ("Telpro");
George M. Construction, Inc. ("George M."); Utility Consultants, Inc.
("UCI"); Communicor Corporation USA, Communications Construction Corporation
and Communicor Equipment Company (collectively, "Communicor"); Craig
Enterprises, Inc. ("Craig"); Felix Equities, Inc. and its affiliates
(collectively, "Felix"); and Intercon Construction, Inc. ("Intercon") and
was derived from the related corresponding historical statements of
operations. The audited historical statement of operations for each of
Linc.net, CLS, M&P, C&B, NSC, Telpro, UCI, Craig, Felix and Intercon are
included elsewhere in this prospectus.

The periods presented in note 2(a) for the year ended December 31, 1999 for
each of the companies are as follows:

<TABLE>
<S> <C>
Linc.net............................. October 19, 1999 to December 31, 1999
CLS.................................. January 1, 1999 to October 19, 1999
M&P.................................. January 1, 1999 to December 21, 1999
C&B.................................. January 1, 1999 to December 21, 1999
NSC.................................. January 1, 1999 to December 31, 1999
Telpro............................... January 1, 1999 to December 31, 1999
George M............................. January 1, 1999 to December 31, 1999
UCI.................................. October 1, 1998 to September 30, 1999
Communicor........................... November 1, 1998 to October 31, 1999
Craig................................ January 1, 1999 to December 31, 1999
Felix................................ October 1, 1998 to September 30, 1999
Intercon............................. January 3, 1999 to January 1, 2000
</TABLE>

The periods presented in note 2(b) for the six months ended June 30, 1999
include the results of operations of each of the acquired companies from
January 1, 1999 to June 30, 1999. Linc.net was formed on October 19, 1999,
and accordingly, no results of operations are presented in the table in
note 2(b).

The results of operations for companies acquired in 1999, including CLS, M&P
and C&B, are included in Linc.net's consolidated results of operations for
the period from January 1, 2000 to June 30, 2000. The results of operations
for each of the companies acquired during the six months ended June 30, 2000
are presented separately for the period from January 1, 2000 to the
respective date of acquisition and included in Linc.net's results of
operations for the period from such date of acquisition to June 30, 2000.
The results of operations for Felix and Telpro, which were not acquired in
full by June 30, 2000, are presented separately. On August 31, 2000 we
agreed to acquire all of the outstanding capital stock of Intercon. We
expect to complete the acquisition of Intercon prior to the completion of
this offering. The results of operations of Intercon are also presented
separately.

The periods presented in note 2(c) for the six months ended June 30, 2000
for each of the companies acquired during the six months ended June 30, 2000
are as follows:

NSC was acquired on January 21, 2000. Accordingly, NSC's results of
operations from January 22, 2000 to June 30, 2000 are included in
Linc.net's results of operations. The results

31
<PAGE>
NOTES TO UNAUDITED PRO FORMA
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (CONTINUED)

FOR THE YEAR ENDED DECEMBER 31, 1999 AND THE SIX MONTHS ENDED JUNE 30, 1999 AND
2000

(IN THOUSANDS)

of NSC's operations from January 1, 2000 to January 21, 2000 are
presented separately in the table in note 2(c).

Linc.net acquired a 60.0% economic interest (49% voting control) of
Telpro on March 13, 2000 and May 19, 2000. The remaining outstanding
stock of Telpro will be acquired by Linc.net subsequent to June 30,
2000, and accordingly; only Linc.net's equity interest in Telpro's
earnings have been included in Linc.net's results of operations from
March 14, 2000 to June 30, 2000. The results of Telpro's operations
for the six months ending June 30, 2000 have been presented
separately in the table in note 2(c).

George M. was acquired on May 2, 2000. Accordingly, George M.'s
results from May 3, 2000 to June 30, 2000 are included in Linc.net's
results of operations. The results of George M.'s operations from
January 1, 2000 to May 2, 2000 are presented separately in the table
in note 2(c).

UCI was acquired on May 8, 2000. Accordingly, UCI's results from
May 9, 2000 to June 30, 2000 are included in Linc.net's results of
operations. The results of UCI's operations from January 1, 2000 to
May 8, 2000 are presented separately in the table in note 2(c).

Communicor was acquired on May 10, 2000. Accordingly, Communicor's
results from May 11, 2000 to June 30, 2000 are included in Linc.net's
results of operations. The results of Communicor's operations from
January 1, 2000 to May 10, 2000 are presented separately in the table
in note 2(c).

Craig was acquired on June 16, 2000. Accordingly, Craig's results
from June 17, 2000 to June 30, 2000 are included in Linc.net's
results of operations. The results of Craig's operations from
January 1, 2000 to June 16, 2000 are presented separately in the
table in note 2(c).

32
<PAGE>
NOTES TO UNAUDITED PRO FORMA
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (CONTINUED)
FOR THE YEAR ENDED DECEMBER 31, 1999 AND THE SIX MONTHS ENDED JUNE 30, 1999 AND
2000
(IN THOUSANDS)

(2)(a) The following table summarizes the historical results for the Year Ended
December 31, 1999:
<TABLE>
<CAPTION>

LINC.NET M&P CLS C&B NSC TELPRO GEORGE M. UCI
-------- -------- -------- -------- -------- -------- ---------- --------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
STATEMENT OF OPERATIONS DATA:
Net revenue.................... $ 1,760 $43,916 $ 7,137 $31,964 $9,835 $73,532 $30,986 $27,955
Costs of sales................. 1,581 32,701 5,390 23,409 7,571 65,120 26,618 22,701
------- ------- ------- ------- ------ ------- ------- -------
Gross profit................... 179 11,215 1,747 8,555 2,264 8,412 4,368 5,254

Costs and expenses:
General and administrative
expenses..................... 868 1,781 954 3,180 599 4,360 2,729 5,067
Amortization of goodwill....... 107 -- -- -- -- 29 -- --
Management fees................ 250 -- -- -- -- -- -- --
Noncash stock compensation..... -- -- -- -- -- 560 -- --
------- ------- ------- ------- ------ ------- ------- -------
Income (loss) from
operations................... (1,046) 9,434 793 5,375 1,665 3,463 1,639 187

Other (income) expenses:
Interest expense (income),
net.......................... 360 (63) -- 156 137 187 86 224
Transaction-related expenses... -- 4,485 2,259 956 -- -- -- --
Other (income) expense, net.... (47) 31 (17) (110) (12) (191) (79) --
------- ------- ------- ------- ------ ------- ------- -------
Income (loss) before income
taxes........................ (1,359) 4,981 (1,449) 4,373 1,540 3,467 1,632 (37)
Income taxes................... (529) 71 16 145 609 1,365 (515) --
------- ------- ------- ------- ------ ------- ------- -------
Net income (loss).............. (830) 4,910 (1,465) 4,228 931 2,102 2,147 (37)
Preferred stock dividends...... (252) -- -- -- -- -- -- --
------- ------- ------- ------- ------ ------- ------- -------
Net income (loss).............. $(1,082) $ 4,910 $(1,465) $ 4,228 $ 931 $ 2,102 $ 2,147 $ (37)
======= ======= ======= ======= ====== ======= ======= =======

<CAPTION>
COMBINED
COMMUNICOR CRAIG FELIX INTERCON HISTORICAL
------------ -------- -------- -------- ----------
<S> <C> <C> <C> <C> <C>
STATEMENT OF OPERATIONS DATA:
Net revenue.................... $35,599 $16,225 $142,973 $39,157 $461,039
Costs of sales................. 28,765 11,424 133,222 32,453 390,955
------- ------- -------- ------- --------
Gross profit................... 6,834 4,801 9,751 6,704 70,084
Costs and expenses:
General and administrative
expenses..................... 3,428 745 7,429 2,849 33,989
Amortization of goodwill....... -- -- -- -- 136
Management fees................ -- -- -- -- 250
Noncash stock compensation..... -- -- -- -- 560
------- ------- -------- ------- --------
Income (loss) from
operations................... 3,406 4,056 2,322 3,855 35,149
Other (income) expenses:
Interest expense (income),
net.......................... 2,026 253 241 369 3,976
Transaction-related expenses... -- -- -- -- 7,700
Other (income) expense, net.... 72 (30) 33 (80) (430)
------- ------- -------- ------- --------
Income (loss) before income
taxes........................ 1,308 3,833 2,048 3,566 23,903
Income taxes................... 458 -- (98) -- 1,522
------- ------- -------- ------- --------
Net income (loss).............. 850 3,833 2,146 3,566 22,381
Preferred stock dividends...... -- -- -- -- (252)
------- ------- -------- ------- --------
Net income (loss).............. $ 850 $ 3,833 $ 2,146 $ 3,566 $ 22,129
======= ======= ======== ======= ========
</TABLE>

33
<PAGE>
NOTES TO UNAUDITED PRO FORMA
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (CONTINUED)
FOR THE YEAR ENDED DECEMBER 31, 1999 AND THE SIX MONTHS ENDED JUNE 30, 1999 AND
2000
(IN THOUSANDS)

(2)(b) The following table summarizes the historical results for the Six Months
Ended June 30, 1999:
<TABLE>
<CAPTION>

M&P CLS C&B NSC TELPRO GEORGE M. UCI COMMUNICOR
-------- -------- -------- -------- -------- ---------- -------- ------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
STATEMENT OF OPERATIONS DATA:
Net revenue..................... $16,800 $4,887 $14,636 $4,866 $39,633 $13,383 $12,426 $18,169
Costs of sales.................. 12,862 3,291 9,514 3,460 35,261 12,466 10,866 14,574
------- ------ ------- ------ ------- ------- ------- -------
Gross profit.................... 3,938 1,596 5,122 1,406 4,372 917 1,560 3,595

Costs and expenses:
General and administrative
expenses...................... 786 587 1,740 274 1,424 1,876 1,965 1,774
Noncash stock compensation...... -- -- -- -- 560 -- -- --
------- ------ ------- ------ ------- ------- ------- -------
Income (loss) from operations... 3,152 1,009 3,382 1,132 2,388 (959) (405) 1,821

Other (income) expenses:
Interest (income) expense,
net........................... (54) -- 112 51 57 -- 106 575
Other (income) expense, net..... (10) (12) 45 -- -- (13) -- (2)
------- ------ ------- ------ ------- ------- ------- -------
Income (loss) before taxes...... 3,216 1,021 3,225 1,081 2,331 (946) (511) 1,248
Income taxes.................... 2 -- -- 427 1,012 (245) -- --
------- ------ ------- ------ ------- ------- ------- -------
Net income (loss)............... $ 3,214 $1,021 $ 3,225 $ 654 $ 1,319 $ (701) $ (511) $ 1,248
======= ====== ======= ====== ======= ======= ======= =======

<CAPTION>
COMBINED
CRAIG FELIX INTERCON HISTORICAL
-------- -------- -------- ----------
<S> <C> <C> <C> <C>
STATEMENT OF OPERATIONS DATA:
Net revenue..................... $7,635 $67,876 $13,411 $213,722
Costs of sales.................. 6,267 63,856 11,521 183,938
------ ------- ------- --------
Gross profit.................... 1,368 4,020 1,890 29,784
Costs and expenses:
General and administrative
expenses...................... 439 4,630 1,499 16,994
Noncash stock compensation...... -- -- -- 560
------ ------- ------- --------
Income (loss) from operations... 929 (610) 391 12,230
Other (income) expenses:
Interest (income) expense,
net........................... 67 206 175 1,295
Other (income) expense, net..... -- (70) (71) (133)
------ ------- ------- --------
Income (loss) before taxes...... 862 (746) 287 11,068
Income taxes.................... -- 390 -- 1,586
------ ------- ------- --------
Net income (loss)............... $ 862 $(1,136) $ 287 $ 9,482
====== ======= ======= ========
</TABLE>

34
<PAGE>
NOTES TO UNAUDITED PRO FORMA
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
FOR THE YEAR ENDED DECEMBER 31, 1999 AND THE SIX MONTHS ENDED JUNE 30, 1999 AND
2000
(IN THOUSANDS)

(2)(c) The following table summarizes the historical results for the Six Months
Ended June 30, 2000:
<TABLE>
<CAPTION>

LINC.NET NSC TELPRO GEORGE M. UCI COMMUNICOR CRAIG FELIX
-------- -------- -------- ---------- -------- ----------- -------- --------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
STATEMENT OF OPERATIONS DATA:
Net revenue........................ $67,717 $ 209 $103,713 $12,334 $10,237 $14,745 $8,812 $111,823
Costs of sales..................... 55,647 (7) 94,820 10,972 8,458 12,202 7,065 94,943
------- ----- -------- ------- ------- ------- ------ --------
Gross profit....................... 12,070 216 8,893 1,362 1,779 2,543 1,747 16,880
Costs and expenses:
General and administrative
expenses......................... 6,395 51 2,116 425 864 1,411 218 3,270
Amortization of goodwill........... 2,124 -- -- -- -- -- -- --
Management fees.................... 500 -- -- -- -- -- -- --
------- ----- -------- ------- ------- ------- ------ --------
Income from operations............. 3,051 165 6,777 937 915 1,132 1,529 13,610
Other (income) expenses:
Interest expense, net.............. 5,093 3 90 -- 91 960 15 368
Other (income) expense, net........ (64) -- 78 (84) -- (4) 19 (39)
------- ----- -------- ------- ------- ------- ------ --------
Income (loss) before income taxes
and equity in income of
investee......................... (1,978) 162 6,609 1,021 824 176 1,495 13,281
Equity in income of investee....... 1,754 -- -- -- -- -- -- --
------- ----- -------- ------- ------- ------- ------ --------
Income (loss) before income
taxes............................ (224) 162 6,609 1,021 824 176 1,495 13,281
Income taxes....................... (791) (33) 296 -- 120 -- 1,948 373
------- ----- -------- ------- ------- ------- ------ --------
Net income (loss).................. 567 195 6,313 1,021 704 176 (453) 12,908
Preferred stock dividends.......... (2,798) -- -- -- -- -- -- --
------- ----- -------- ------- ------- ------- ------ --------
Net income (loss) to common
stockholders..................... $(2,231) $ 195 $ 6,313 $ 1,021 $ 704 $ 176 $ (453) $ 12,908
======= ===== ======== ======= ======= ======= ====== ========

<CAPTION>
COMBINED
INTERCON HISTORICAL
-------- ----------
<S> <C> <C>
STATEMENT OF OPERATIONS DATA:
Net revenue........................ $20,690 $350,280
Costs of sales..................... 17,074 301,174
------- --------
Gross profit....................... 3,616 49,106
Costs and expenses:
General and administrative
expenses......................... 1,696 16,446
Amortization of goodwill........... -- 2,124
Management fees.................... -- 500
------- --------
Income from operations............. 1,920 30,036
Other (income) expenses:
Interest expense, net.............. 226 6,846
Other (income) expense, net........ (108) (202)
------- --------
Income (loss) before income taxes
and equity in income of
investee......................... 1,802 23,392
Equity in income of investee....... -- 1,754
------- --------
Income (loss) before income
taxes............................ 1,802 25,146
Income taxes....................... -- 1,913
------- --------
Net income (loss).................. 1,802 23,233
Preferred stock dividends.......... -- (2,798)
------- --------
Net income (loss) to common
stockholders..................... $ 1,802 $ 20,435
======= ========
</TABLE>

35
<PAGE>
NOTES TO UNAUDITED PRO FORMA
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (CONTINUED)

FOR THE YEAR ENDED DECEMBER 31, 1999 AND THE SIX MONTHS ENDED JUNE 30, 1999 AND
2000

(IN THOUSANDS)

(3) On or prior to Linc.net's acquisition of the remaining outstanding shares of
Telpro, Telpro will divest a product line of its business into a newly
formed subsidiary of which Telpro will own a 49.0% interest. Accordingly,
the revenue and related costs of goods sold pertaining to this product line
have been eliminated from the historical financial data. The amount of
revenue and costs of goods sold eliminated for the year ended December 31,
1999 is $41,076 and $39,734, respectively. The amount of revenue and costs
of goods sold eliminated in the six months ended June 30, 1999 and 2000 is
$26,101 and $25,107, and $80,784 and $77,353, respectively. In addition,
adjustments of $1,342 for the year ended December 31, 1999 and $994 and
$3,431 for the six months ended June 30, 1999 and 2000, respectively,
reflect the estimated revenue to be earned by Linc.net earned under a
service agreement between the companies.

(4) Represents costs incurred by the acquired companies in connection with our
acquisition of such companies. Adjustments reflect the following:

<TABLE>
<CAPTION>
FOR THE YEAR FOR THE SIX FOR THE SIX
ENDED MONTHS ENDED MONTHS ENDED
DECEMBER 31, 1999 JUNE 30, 1999 JUNE 30, 2000
----------------- ------------- -------------
<S> <C> <C> <C>
Elimination of a portion of
management salaries under
employment agreements (a)........ $ (3,725) $(2,290) $(837)
Elimination of certain costs
directly attributed to the
transaction (b).................. (7,700) -- --
-------- ------- -----
Total.......................... $(11,425) $(2,290) $(837)
======== ======= =====
Related to cost of sales... $ (2,235) $(1,374) $(502)
Related to selling, general
and administrative....... (1,490) (916) (335)
Related to other
expenses................. (7,700) -- --
-------- ------- -----
$(11,425) $(2,290) $(837)
======== ======= =====
</TABLE>

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

(a) Adjustment to reflect the elimination of a portion of compensation,
benefits and other expenses of owners and managers of the related
acquired companies to reflect the compensation expense

36
<PAGE>
NOTES TO UNAUDITED PRO FORMA
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (CONTINUED)

FOR THE YEAR ENDED DECEMBER 31, 1999 AND THE SIX MONTHS ENDED JUNE 30, 1999 AND
2000

(IN THOUSANDS)

under new employment agreements signed contemporaneously with each such
acquisition. Such amounts are summarized as follows:

<TABLE>
<CAPTION>
FOR THE YEAR FOR THE SIX FOR THE SIX
ENDED MONTHS MONTHS
DECEMBER 31, ENDED ENDED
1999 JUNE 30, 1999 JUNE 30, 2000
------------ ------------- -------------
<S> <C> <C> <C>
CLS............................. $ 171 $ 53 $ --
M&P............................. (50) 18 --
C&B............................. (106) (53) --
NSC............................. 127 65 10
Telpro.......................... (1,501) (170) (538)
George M........................ (711) (808) 45
UCI............................. (296) (148) (263)
Communicor...................... 133 67 68
Craig........................... (102) (159) 50
Felix........................... (1,149) (1,034) (88)
Intercon........................ (241) (121) (121)
------- ------- -----
$(3,725) $(2,290) $(837)
======= ======= =====
</TABLE>

(b) Adjustment to eliminate certain closing costs and bonuses paid
contingent upon the related acquisition for CLS, M&P and C&B for the year
ended December 31, 1999, which was $(2,259), $(4,485) and
$(956), respectively.

(5) Adjustment reflects the additional goodwill amortization associated with the
acquisitions as if such acquisitions had occurred at the beginning of the
period presented. For pro forma purposes, goodwill is being amortized over a
period of 20 years.

<TABLE>
<CAPTION>
FOR THE YEAR FOR THE SIX FOR THE SIX
ENDED MONTHS MONTHS
DECEMBER 31, ENDED ENDED
1999 JUNE 30, 1999 JUNE 30, 2000
------------ ------------- -------------
<S> <C> <C> <C>
CLS..................................... $ 602 $ 301 $ 301
M&P..................................... 1,435 718 718
C&B..................................... 1,126 563 563
NSC..................................... 273 136 136
Telpro.................................. 2,415 1,208 1,208
George M................................ 601 300 300
UCI..................................... 478 239 239
Communicor.............................. 675 337 337
Craig................................... 894 447 447
Felix................................... 3,350 1,675 1,675
Intercon................................ 1,615 808 808
------- ------ ------
Total pro forma goodwill amortization... 13,464 6,732 6,732
Recorded goodwill amortization.......... 136 -- 2,124
------- ------ ------
Pro forma adjustment.................... $13,328 $6,732 $4,608
======= ====== ======
</TABLE>

37
<PAGE>
NOTES TO UNAUDITED PRO FORMA
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (CONTINUED)

FOR THE YEAR ENDED DECEMBER 31, 1999 AND THE SIX MONTHS ENDED JUNE 30, 1999 AND
2000

(IN THOUSANDS)

(6) Increase in interest expense to reflect the interest associated with
borrowings at Linc.net's current rate of 10 3/8% under Linc.net's credit
facilities to finance the acquisitions plus the related amortization of
deferred financing fees, as if the credit facilities had been consummated as
of the beginning of the period presented, summarized as follows:

<TABLE>
<CAPTION>
FOR THE YEAR FOR THE SIX FOR THE SIX
ENDED MONTHS MONTHS
DECEMBER 31, ENDED ENDED
1999 JUNE 30, 1999 JUNE 30, 2000
------------ ------------- -------------
<S> <C> <C> <C>
Linc.net................................ $ 1,098 $ 549 $ 549
CLS..................................... 880 440 440
M&P..................................... 2,909 1,454 1,454
C&B..................................... 2,528 1,264 1,264
NSC..................................... 415 207 207
Telpro.................................. 2,522 1,261 1,261
George M................................ 1,556 778 778
UCI..................................... 757 379 379
Communicor.............................. 1,214 607 607
Craig................................... 1,691 846 846
Felix................................... 6,505 3,253 3,253
Intercon................................ 2,475 1,237 1,237
------- ------- -------
Total pro forma interest expense........ 24,550 12,275 12,275
Recorded interest expense............... 3,976 1,295 6,846
------- ------- -------
Pro forma adjustment.................... $20,574 $10,980 $ 5,429
======= ======= =======
</TABLE>

(7) Adjusted to reflect the income tax effect of the pro forma and offering
adjustments and the income tax effect of the acquired companies becoming C
corporations, as applicable, assuming an estimated effective federal and
state tax rate of 39.0%.

(8) Increase in preferred stock dividends to reflect the issuance of $127,195 of
Series A mandatorily redeemable preferred stock and Series B redeemable
preferred stock, that accumulates dividends at a

38
<PAGE>
NOTES TO UNAUDITED PRO FORMA
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (CONTINUED)

FOR THE YEAR ENDED DECEMBER 31, 1999 AND THE SIX MONTHS ENDED JUNE 30, 1999 AND
2000

(IN THOUSANDS)

rate of 10% per annum of the liquidation value of $1 per share, issued to
finance the acquisitions as of the beginning of the period presented
summarized as follows:

<TABLE>
<CAPTION>
FOR THE YEAR FOR THE SIX FOR THE SIX
ENDED MONTHS MONTHS
DECEMBER 31, ENDED ENDED
1999 JUNE 30, 1999 JUNE 30, 2000
------------ ------------- -------------
<S> <C> <C> <C>
CLS..................................... (871) (436) (436)
M&P and C&B............................. (2,855) (1,428) (1,428)
NSC..................................... (231) (115) (115)
Telpro.................................. (1,799) (899) (899)
George M................................ (641) (321) (321)
UCI..................................... (905) (453) (453)
Communicor.............................. (130) (65) (65)
Craig................................... (735) (367) (367)
Felix................................... (3,012) (1,506) (1,506)
Intercon................................ (1,608) (804) (804)
-------- ------- -------
Pro forma preferred stock dividends..... (12,787) (6,394) (6,394)
Recorded preferred stock dividends...... (252) -- (2,798)
-------- ------- -------
Pro forma preferred stock dividend
adjustment............................ $(12,535) $(6,394) $(3,596)
======== ======= =======
</TABLE>

39
<PAGE>
UNAUDITED PRO FORMA CONDENSED CONSOLIDATED BALANCE SHEET

JUNE 30, 2000
<TABLE>
<CAPTION>
FELIX INTERCON TELPRO
COMBINED ACQUISITION ACQUISITION ACQUISITION
HISTORICAL(1)(2) ADJUSTMENTS(3) ADJUSTMENTS(4) ADJUSTMENTS(5) PRO FORMA
---------------- -------------- -------------- -------------- ---------
(IN THOUSANDS)
<S> <C> <C> <C> <C> <C>
ASSETS:
Current assets:
Cash and cash equivalents............... $ 5,265 $-- $-- $-- $5,265
Accounts receivable..................... 118,854 -- -- -- 118,854
Costs and estimated earnings in excess
of billings on uncompleted
contracts............................. 35,574 -- -- -- 35,574
Inventory............................... 2,642 -- -- -- 2,642
Prepaids and other assets............... 4,824 -- -- -- 4,824
Due from affiliate...................... 16,641 -- -- (16,641) --
-------- --------- --------- --------- --------
Total current assets.................... 183,800 -- -- (16,641) 167,159

Fixed assets, net....................... 52,921 -- -- -- 52,921
Goodwill, net........................... 119,871 64,104 23,392 38,951 246,318
Investment in affiliate................. 21,195 -- -- (21,195) --
Deferred financing costs, net........... 5,726 -- -- -- 5,726
Income tax receivable................... 1,251 -- -- -- 1,251
Other noncurrent assets................. 899 -- -- -- 899
-------- --------- --------- --------- --------
Total assets........................ $385,663 $64,104 $23,392 $1,115 $474,274
======== ========= ========= ========= ========
LIABILITIES AND STOCKHOLDERS' EQUITY:
Current liabilities:
Current portion of long-term debt....... $ 10,625 $(7,225) $(554) $-- $2,846
Revolving credit facility............... 9,750 -- -- -- 9,750
Accounts payable and accrued expenses... 86,767 -- -- -- 86,767
Billings in excess of costs and
estimated earnings on uncompleted
contracts............................. 5,666 -- -- -- 5,666
Due to affiliate........................ 16,641 -- -- (16,641) --
Current portion of capital lease
obligations........................... 285 -- -- -- 285
-------- --------- --------- --------- --------
Total current liabilities............... 129,734 (7,225) (554) (16,641) 105,314

Long-term debt, less current............ 143,792 (2,744)(6) (9,880)(6) 4,919 (6) 222,642
62,700 (6) 23,855 (6)
Capital lease obligations, less current
portion............................... 915 -- -- -- 915
Series A mandatorily redeemable
preferred stock....................... 78,807 30,119 (7) 16,075 (7) 5,615 (7) 130,616
Stockholders' equity:
Common stock............................ 9,738 (251) (412) 702 (7) 14,899
3,347 (7) 1,775 (7)
Series B redeemable preferred stock..... 5,919 -- -- -- 5,919
Retained earnings....................... 19,476 (21,842) (7,467) 6,520 (3,313)
Stockholders' loans..................... (228) -- -- -- (228)
Excess of purchase price over
predecessor basis..................... (2,490) -- -- -- (2,490)
-------- --------- --------- --------- --------
Total stockholders' equity.............. 32,415 (18,746) (6,104) 7,222 14,787
-------- --------- --------- --------- --------
Total liabilities and stockholders'
equity................................ $385,663 $64,104 $23,392 $1,115 $474,274
======== ========= ========= ========= ========

OFFERING PRO FORMA,
ADJUSTMENTS AS ADJUSTED
----------- -----------
(IN THOUSANDS)
<S> <C> <C>
ASSETS:
Current assets:
Cash and cash equivalents...............
Accounts receivable.....................
Costs and estimated earnings in excess
of billings on uncompleted
contracts.............................
Inventory...............................
Prepaids and other assets...............
Due from affiliate......................
-------- --------
Total current assets....................
Fixed assets, net.......................
Goodwill, net...........................
Investment in affiliate.................
Deferred financing costs, net...........
Income tax receivable...................
Other noncurrent assets.................
-------- --------
Total assets........................
======== ========
LIABILITIES AND STOCKHOLDERS' EQUITY:
Current liabilities:
Current portion of long-term debt.......
Revolving credit facility...............
Accounts payable and accrued expenses...
Billings in excess of costs and
estimated earnings on uncompleted
contracts.............................
Due to affiliate........................
Current portion of capital lease
obligations...........................
-------- --------
Total current liabilities...............
Long-term debt, less current............

Capital lease obligations, less current
portion...............................
Series A mandatorily redeemable
preferred stock.......................
Stockholders' equity:
Common stock............................

Series B redeemable preferred stock.....
Retained earnings.......................
Stockholders' loans.....................
Excess of purchase price over
predecessor basis.....................
-------- --------
Total stockholders' equity..............
-------- --------
Total liabilities and stockholders'
equity................................
======== ========
</TABLE>

40
<PAGE>
NOTES TO UNAUDITED PRO FORMA CONDENSED CONSOLIDATED BALANCE SHEET

JUNE 30, 2000

(IN THOUSANDS)

(1) The combined historical data gives pro forma effect to the acquisitions of
Felix, Intercon and Telpro as if the transactions were consummated on
June 30, 2000. The data was derived from the related corresponding company's
historical balance sheet at June 30, 2000. On August 31, 2000, we agreed to
acquire all of the outstanding capital stock of Intercon. We expect to
complete the acquisition of Intercon prior to the completion of this
offering. The financial position of Intercon is presented separately.

(2) The following table summarizes the historical balance sheet at June 30,
2000:

<TABLE>
<CAPTION>
COMBINED
LINC.NET FELIX INTERCON TELPRO HISTORICAL
-------- -------- -------- -------- ----------
<S> <C> <C> <C> <C> <C>
ASSETS
Current assets:
Cash and cash
equivalents.............. $ 3,233 $ 1,973 $ 27 $ 32 $ 5,265
Accounts receivable........ 38,247 39,625 9,577 31,405 118,854
Costs and estimated
earnings in excess of
billings on uncompleted
contracts................ 18,314 14,285 -- 2,975 35,574
Inventory.................. 231 -- 582 1,829 2,642
Prepaids and other
assets................... 3,305 1,047 71 401 4,824
Due from affiliate......... 16,641 -- -- -- 16,641
-------- ------- ------- ------- --------
Total current assets......... 79,971 56,930 10,257 36,642 183,800

Fixed assets, net............ 29,758 11,199 10,902 1,062 52,921
Goodwill, net................ 119,442 -- -- 429 119,871
Investment in affiliate...... 21,195 -- -- -- 21,195
Deferred financing costs,
net........................ 5,726 -- -- -- 5,726
Income tax receivable........ -- -- -- 1,251 1,251
Other noncurrent assets...... 521 208 95 75 899
-------- ------- ------- ------- --------
Total assets................. $256,613 $68,337 $21,254 $39,459 $385,663
======== ======= ======= ======= ========
</TABLE>

41
<PAGE>
NOTES TO UNAUDITED PRO FORMA CONDENSED CONSOLIDATED BALANCE SHEET (CONTINUED)

JUNE 30, 2000

(IN THOUSANDS)

<TABLE>
<CAPTION>
COMBINED
LINC.NET FELIX INTERCON TELPRO HISTORICAL
-------- -------- -------- -------- ----------
<S> <C> <C> <C> <C> <C>
LIABILITIES AND COMMON
STOCKHOLDERS' EQUITY
Current liabilities:
Current portion of
long-term debt........... $ 2,846 $ 7,225 $ 554 $ -- $ 10,625
Revolving credit
facility................. 9,750 -- -- -- 9,750
Accounts payable and
accrued expenses......... 23,637 31,153 2,941 29,036 86,767
Billings in excess of costs
and estimated earnings on
uncompleted contracts.... 942 4,430 -- 294 5,666
Due to affiliate........... -- -- -- 16,641 16,641
Current portion of capital
lease obligations........ 168 117 -- -- 285
-------- ------- ------- ------- --------
Total current liabilities.... 37,343 42,925 3,495 45,971 129,734

Long-term debt, less current
portion.................... 131,160 2,744 9,880 8 143,792
Capital lease obligations,
less current portion....... 340 575 -- -- 915
Series A mandatorily
redeemable preferred
stock...................... 78,807 -- -- -- 78,807
Stockholders' equity:
Common stock................. 9,075 251 412 -- 9,738
Series B redeemable preferred
stock...................... 5,919 -- -- -- 5,919
Retained earnings
(deficit).................. (3,313) 21,842 7,467 (6,520) 19,476
Stockholders' loans.......... (228) -- -- -- (228)
Excess of purchase price over
predecessor basis.......... (2,490) -- -- -- (2,490)
-------- ------- ------- ------- --------
Total stockholders' equity... 8,963 22,093 7,879 (6,520) 32,415
-------- ------- ------- ------- --------
Total liabilities and
stockholders' equity....... $256,613 $68,337 $21,254 $39,459 $385,663
======== ======= ======= ======= ========
</TABLE>

(3) Reflects the acquisition of Felix which was accounted for as a purchase in
accordance with Accounting Principles Board Opinion No. 16, "Business
Combinations." The purchase price is being allocated to tangible and
identifiable intangible assets and liabilities based upon preliminary
estimates of their fair values, with the excess of purchase price, including
direct acquisition costs, over fair value allocated to goodwill. We have not
yet determined a final allocation of the purchase price of Felix as current
information regarding the fair values of assets acquired is not available
and accordingly, the allocation may differ from the amounts ultimately
determined. The purchase price of $96.2 million, including direct
acquisition costs of $1.9 million, was allocated to working capital of
$21.2 million, non-current liabilities, net of $.3 million, fixed assets of
$11.2 million and goodwill of $64.1 million. The adjustment also includes
the retirement of debt and the elimination of Felix's historical equity.

42
<PAGE>
NOTES TO UNAUDITED PRO FORMA CONDENSED CONSOLIDATED BALANCE SHEET (CONTINUED)

JUNE 30, 2000

(IN THOUSANDS)

(4) Reflects the proposed acquisition of Intercon which will be accounted for as
a purchase in accordance with Accounting Principles Board Opinion No. 16,
"Business Combinations." The purchase price will be allocated to tangible
and identifiable intangible assets and liabilities based upon preliminary
estimates of their fair values, with the excess of purchase price, including
direct acquisition costs, over fair value allocated to goodwill. We have not
yet determined a final allocation of the purchase price of Intercon as
current information regarding the fair values of assets acquired is not
available and accordingly, the allocation may differ from the amounts
ultimately determined. The estimated purchase price of $41.7 million,
including estimated direct acquisition costs of $3.0 million, was allocated
to working capital of $7.3 million, non-current assets of $.1 million, fixed
assets of $10.9 and goodwill of $23.4 million. The adjustment also includes
the elimination of retired debt and Intercon's historical equity.

(5) Reflects the acquisition of the remaining outstanding shares of Telpro which
was accounted for as a purchase in accordance with Accounting Principles
Board Opinion No. 16, "Business Combinations." The purchase price is being
allocated to tangible and identifiable intangible assets and liabilities
based upon preliminary estimates of their fair values, with the excess of
purchase price, including direct acquisition costs, over fair value
allocated to goodwill. We have not yet determined a final allocation of the
purchase price of Telpro as current information regarding the fair values of
assets acquired is not available and accordingly, the allocation may differ
from the amounts ultimately determined. The purchase price of
$51.0 million, including estimated direct acquisition costs of $2.6 million
was allocated to working capital of approximately $9.2 million, fixed assets
of $1.1 million, other assets of $1.3 million and goodwill of
$39.4 million. The adjustment also includes the elimination of Telpro's
historical equity.

(6) Adjustment reflects the increase in long-term debt associated with
borrowings under the senior credit facility.

(7) Adjustment reflects the increase in equity associated with the issuance of
10% cumulative mandatorily redeemable preferred stock and common stock as
follows:

<TABLE>
<CAPTION>
FELIX INTERCON TELPRO TOTAL
-------- -------- -------- --------
<S> <C> <C> <C> <C>
Preferred stock--Series A................ $30,119 $16,075 $5,615 $51,809
Common stock--par........................ 3 2 1 6
Common stock--additional paid in
capital................................ 3,344 1,773 701 5,818
------- ------- ------ -------
Proceeds from issuance of stock.......... $33,466 $17,850 $6,317 $57,633
======= ======= ====== =======
</TABLE>

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<PAGE>
MANAGEMENT'S DISCUSSION AND ANALYSIS
OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

THE FOLLOWING DISCUSSION SHOULD BE READ IN CONJUNCTION WITH OUR FINANCIAL
STATEMENTS AND THE NOTES TO THOSE STATEMENTS AND OTHER FINANCIAL INFORMATION
APPEARING ELSEWHERE IN THIS PROSPECTUS. THIS PROSPECTUS CONTAINS FORWARD-LOOKING
STATEMENTS THAT INVOLVE RISKS AND UNCERTAINTIES. OUR ACTUAL RESULTS MAY DIFFER
MATERIALLY FROM THOSE INDICATED IN FORWARD-LOOKING STATEMENTS. SEE "CAUTIONARY
NOTE REGARDING FORWARD-LOOKING STATEMENTS."

WE HAVE INCLUDED INFORMATION IN THIS SECTION INCORPORATING THE OPERATIONS OF
INTERCON AS A RESULT OF OUR BELIEF THAT THE INTERCON ACQUISITION WILL BE
COMPLETED IN ACCORDANCE WITH THE TERMS SET FORTH IN THIS PROSPECTUS. IF THE
INTERCON ACQUISITION IS NOT COMPLETED, THE INFORMATION IN THIS PROSPECTUS GIVING
EFFECT TO SUCH ACQUISITION WOULD NOT BE RELEVANT TO YOU.

GENERAL

We are a full-service provider of high-quality network infrastructure
services, with leading positions in the central office installation, network
infrastructure engineering and last mile deployment markets. We provide our
services to telecommunications, Internet and cable television providers, and to
a lesser extent, energy companies. We engineer, install and maintain electronic,
digital subscriber line (DSL) and optical telecommunications equipment in the
central offices of major network providers. We also perform engineering, program
management and installation of fiber optic and other cabling and related
equipment for wireless and wireline telecommunications providers.

Our primary types of contracts with our customers include:

- design and/or installation contracts for specific projects,

- master service agreements for all design and/or installation and
maintenance services within a defined geographic territory and

- end-to-end agreements for comprehensive design, engineering, installation,
procurement and maintenance services.

The majority of our contracts, whether master service agreements or
contracts for specific projects, provide that we will furnish a specified unit
of service for a specified unit of price. For example, we contract to install
cable for a specified rate per foot. We recognize revenue as the related work is
performed. A portion of our work is performed under percentage-of-completion
contracts. Under this method, revenue is recognized on a cost-to-cost method
based on the percentage of total cost incurred to date in proportion to total
estimated cost to complete the contract. Customers are billed with varying
frequency--weekly, monthly or upon achievement of certain milestones.

We perform a significant portion of our services under master service
agreements, which typically are exclusive service agreements to provide all of
the customer's network requirements up to a specified dollar amount per job
within defined geographic areas. These contracts are generally for two to three
years in duration but are typically subject to termination at any time upon 90
to 180 days prior notice. These agreements generally contemplate hundreds of
individual projects valued at less than $100,000 each. These master service
agreements are typically awarded on a competitive bid basis, although customers
are sometimes willing to negotiate contract extensions beyond their original
terms without opening them up to bid. Master service agreements are invoiced on
a unit basis where invoices are submitted as work is completed. We currently
have 36 master service agreements across all segments in which we operate.

Our direct costs include:

- operations payroll and benefits,

- equipment and related expenses,

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<PAGE>
- subcontractor costs,

- materials not provided by our customers,

- insurance and

- other (e.g., rent, utilities and tools)

Our customers generally supply materials such as electronic equipment and
fiber optic and other cable, although on some end-to-end projects we supply
these materials. General and administrative costs include all costs of our
management personnel, rent and utilities for our administrative facilities,
travel and business development efforts and back office administration such as
financial services, insurance administration, professional costs and clerical
and administrative overhead.

Some of our contracts require performance and payment bonds. Some contracts
generally include payment provisions under which 5% to 10% is withheld until the
contract work has been completed. We typically agree to indemnify our customers
against adverse claims and warrant the quality of our services for specified
time periods, usually one year.

RESULTS OF OPERATIONS

PRO FORMA RESULTS OF OPERATIONS

The following table sets forth financial data on a pro forma basis and such
data as a percentage of revenues for the periods indicated. Financial data in
this section for the six months ended June 30, 1999 and 2000 and for the year
ended December 31, 1999 give pro forma effect to the companies we have acquired
since October 1999, as described under the heading "Unaudited Pro Forma
Condensed Consolidated Financial Statements," as if these transactions had
occurred at the beginning of each period presented. See "Pro Forma Condensed
Consolidated Financial Statements."

<TABLE>
<CAPTION>
SIX MONTHS ENDED
YEAR ENDED JUNE 30,
DECEMBER 31, -------------------------------
1999 1999 2000
-------------- -------------- --------------
(DOLLARS IN THOUSANDS)
<S> <C> <C> <C> <C> <C> <C>
STATEMENT OF OPERATIONS DATA:
Net revenue.................................. $421.3 100.0% $188.6 100.0% $272.9 100.0%
Costs of sales............................... 349.0 82.8 157.5 83.5 223.3 81.8
------ ----- ------ ----- ------ -----
Gross profit................................. 72.3 17.2 31.1 16.5 49.6 18.2
General and administrative expenses.......... 32.5 7.7 16.1 8.5 16.1 5.9
Amortization of goodwill..................... 13.5 3.2 6.7 3.6 6.7 2.5
Management fees.............................. .3 .1 -- -- .5 .2
Noncash stock compensation................... .6 .1 .6 .3 -- --
Interest expense, net........................ 24.6 5.8 12.3 6.5 12.3 4.5
Net income (loss)............................ .9 .2 (2.7) (1.4) 8.7 3.2

OTHER DATA:
EBITDA....................................... $ 48.1 11.4% $ 18.8 10.0% $ 39.4 14.4%
Depreciation................................. 8.7 2.1 4.2 2.2 6.2 2.3
Amortization................................. 13.5 3.2 6.7 3.6 6.7 2.5
</TABLE>

PRO FORMA SIX MONTHS ENDED JUNE 30, 2000 COMPARED TO PRO FORMA SIX MONTHS
ENDED JUNE 30, 1999

PRO FORMA NET REVENUE. Pro forma net revenue increased $84.3 million or
44.7% from $188.6 million for the six months ended June 30, 1999 to
$272.9 million for the six months ended June 30, 2000. The increase in pro forma
net revenue was due to an increase in all service offerings with network
infrastructure deployment and central office equipment engineering, furnishing
and installation, or EF&I, having a

45
<PAGE>
higher growth rate than network infrastructure engineering and wireless
installation. Network infrastructure deployment services increased
$67.2 million or 42.9% from $156.6 million for the six months ended June 30,
1999 to $223.8 million for the six months ended June 30, 2000. The growth in
infrastructure deployment services revenue was primarily due to increased demand
for fiber and cable installation. Revenue for our other service offerings
increased $17.1 million or 53.4% from $32.0 million for the six months ended
June 30, 1999 to $49.1 million for the six months ended June 30, 2000. The
growth in these service offerings is primarily the result of increased demand
for engineering and central office EF&I.

PRO FORMA COSTS OF SALES. Pro forma costs of sales increased
$65.8 million, or 41.8%, from $157.5 million for the six months ended June 30,
1999 to $223.3 million for the six months ended June 30, 2000. The increase in
pro forma costs of sales is consistent with the increase in pro forma net
revenues and is comprised principally of labor, subcontracted labor and
services, equipment and other direct costs of network deployment and central
office EF&I. Costs of sales related to infrastructure deployment services
increased $54.5 million or 40.9% from $133.1 million for the six months ended
June 30, 1999 to $187.6 million for the six months ended June 30, 2000. The
growth rate in the costs of sales related to the infrastructure deployment
services was primarily due to the increase in sales volume resulting in
increases in related costs. Costs of sales for our other service offerings
increased $11.3 million or 46.3% from $24.4 million for the six months ended
June 30, 1999 to $35.7 million for the six months ended June 30, 2000. The
increase in the cost of these service offerings is primarily the result of
increased sales volume resulting in increases in labor and related costs.

PRO FORMA GROSS PROFIT. Pro forma gross profit increased $18.5 million or
59.5% from $31.1 million for the six months ended June 30, 1999 to
$49.6 million for the six months ended June 30, 2000. Pro forma gross profit
percentage increased from 16.5% for the six months ended June 30, 1999 to 18.2%
for the six months ended June 30, 2000. Pro forma gross profit on infrastructure
deployment services increased $12.7 million or 54.0% from $23.5 million for the
six months ended June 30, 1999 to $36.2 million for the six months ended
June 30, 2000. Gross profit percentage related to infrastructure deployment
services on a pro forma basis increased from 15.0% for the six months ended
June 30, 1999 to 16.2% for the six months ended June 30, 2000. The increase in
the gross profit percentage was primarily due to sales volume increases. Pro
forma gross profit on other service offerings increased $5.8 million or 76.3%
from $7.6 million for the six months ended June 30, 1999 to $13.4 million for
the six months ended June 30, 2000. Pro forma gross profit percentage for these
services increased from 23.8% for the six months ended June 30, 1999 as compared
to 27.3% for the six months ended June 30, 2000. The increase in the gross
profit percentage is the result of increased central office EF&I revenue.

PRO FORMA GENERAL AND ADMINISTRATIVE EXPENSES. Pro forma general and
administrative expenses were $16.1 million for the six months ended June 30,
1999 and 2000.

PRO FORMA AMORTIZATION OF GOODWILL. On a pro forma basis, amortization of
goodwill was $6.7 million for both the six months ended June 30, 1999 and the
six months ended June 30, 2000. Goodwill recognized in connection with our
acquisitions is being amortized over a period of 20 years.

PRO FORMA MANAGEMENT FEES. Pro forma management fees increased to
$.5 million. In connection with our formation, management service agreements
were entered into with our principal stockholders. Under the agreements, we pay
annual management fees totaling $1.0 million. For the six months ended June 30,
1999 no management fees were incurred as we had not yet been formed. For the six
months ended June 30, 2000, we incurred $.5 million in fees under the
agreements, which represented six months of services. As a result of this
offering, we have negotiated to terminate these arrangements in exchange for
shares of common stock and shares of Series A mandatorily redeemable
preferred stock.

PRO FORMA NON-CASH STOCK COMPENSATION EXPENSE. Pro forma non-cash stock
compensation expense decreased $.6 million in the six months ended June 30, 2000
compared to the same period in 1999. One of our subsidiaries recognized
$.6 million of expense in the six months ended June 30, 1999, which represented
the difference between the fair market value of stock issued to employees and
the price paid

46
<PAGE>
for the stock. No non-cash stock compensation charges were recognized during the
six months ended June 30, 2000. In the future, we intend to issue all
stock-based compensation to employees at fair market value.

PRO FORMA INCOME FROM OPERATIONS. Pro forma income from operations
increased $18.5 million or 237.2% from $7.8 million for the six months ended
June 30, 1999 to $26.3 for the six months ended June 30, 2000. The increase was
attributable to the factors stated above.

PRO FORMA INTEREST EXPENSE, NET. Pro forma interest expense, net was
$12.3 million for the six months ended June 30, 1999 and the six months ended
June 30, 2000 representing pro forma interest expense on outstanding
indebtedness using a pro forma interest rate of 10 3/8%, representing the
average interest rate on our outstanding indebtedness as of September 6, 2000.

PRO FORMA INCOME TAXES. Pro forma income taxes increased $7.2 million, from
a $1.7 million benefit for the six months ended June 30, 1999 to a $5.5 million
expense for the six months ended June 30, 2000. Pro forma income taxes have been
presented at 39.0% of income before income taxes, representing our estimated
federal and state effective income tax rate for the six months ended June 30,
1999 and the six months ended June 30, 2000. The increase in income taxes is due
to the overall increase in income before income taxes.

PRO FORMA NET INCOME (LOSS). Pro forma net income (loss) increased
$11.4 million from $(2.7) million for the six months ended June 30, 1999 to
$8.7 million for the six months ended June 30, 2000. The increase in pro forma
net income is attributable to the factors stated above.

PRO FORMA YEAR ENDED DECEMBER 31, 1999

PRO FORMA NET REVENUE. Pro forma net revenue for the year ended
December 31, 1999 were $421.3 million reflecting revenue for the acquired
companies as if they had been acquired on January 1, 1999.

PRO FORMA COSTS OF SALES. Pro forma costs of sales was $349.0 million or
82.8% of pro forma revenue.

PRO FORMA GROSS PROFIT. The pro forma gross profit for the year ended
December 31, 1999 was $72.3 million, or 17.2%, of pro forma revenue.

PRO FORMA GENERAL AND ADMINISTRATIVE EXPENSES. General and administrative
expenses on a pro forma basis were $32.5 million, or 7.7% of pro forma revenue
for the year ended December 31, 1999. The pro forma general and administrative
expenses include a pro forma adjustment to give effect to a reduction in
executive compensation of $1.5 million for the year ended December 31, 1999 as a
result of the renegotiation of executive compensation arrangements in connection
with the acquisitions.

PRO FORMA AMORTIZATION OF GOODWILL. Pro forma expenses reflect the
amortization of goodwill in the amount of $13.5 million associated with the
acquisitions. Goodwill is being amortized over twenty years.

PRO FORMA MANAGEMENT FEES. Pro forma management fees for the year ended
December 31, 1999 were $.3 million. The management fees are in connection with
management service agreements entered into with our principal stockholders upon
the formation of Linc.net.

PRO FORMA INTEREST EXPENSE, NET. Pro forma interest expense, net was
$24.6 million, or 5.8% of net revenue for the year ended December 31, 1999. This
amount represents the pro forma interest expense on outstanding indebtedness
using a pro forma interest rate of 10 3/8%, representing the average interest
rate on our outstanding indebtedness as of September 6, 2000.

PRO FORMA NON-CASH STOCK COMPENSATION EXPENSE. Pro forma non-cash stock
compensation expense was $.6 million for the year ended December 31, 1999. Prior
to its acquisition, one of our subsidiaries recognized $.6 million of expense
which represented the difference between fair market value of stock

47
<PAGE>
issued to employees and the price paid for the stock. In the future, we intend
on issuing all stock-based compensation at fair market value.

PRO FORMA INCOME FROM OPERATIONS. Pro forma income from operations for the
year ended December 31, 1999 was $25.6 million.

PRO FORMA INCOME TAXES. Pro forma income tax expense were $.6 million for
the year ended December 31, 1999.

PRO FORMA NET INCOME. Pro forma net income for the year ended December 31,
1999 was $.9 million.

HISTORICAL RESULTS OF OPERATIONS

M&P is our corporate predecessor for accounting purposes. As such, our
historical results of operations are those of M&P up to December 21, 1999, the
date of our acquisition of M&P, and our results of operations subsequent to that
date. The discussions related to the period ended December 21, 1999, the years
ended December 31, 1998 and 1997 and the six months ended June 30, 1999 are the
results of operations of M&P. The six months ended June 30, 2000 reflect our
operations which include the results of the acquired companies subsequent to the
date of their acquisiton. The companies included in the June 30, 2000 results
are Linc.net, M&P, CLS, C&B, George M., NSC, Communicor, Craig, UCI and our
equity interest in Telpro.

Financial information for the period ended December 21, 1999 and for the
years ended December 31, 1998 and 1997 was derived from the audited financial
statements of M&P. Financial information for the six months ended June 30, 2000
was derived from our unaudited financial statements and the financial
information for the six months ended June 30, 1999 was derived from the
unaudited financial statements of M&P.

SIX MONTHS ENDED JUNE 30, 2000 COMPARED TO SIX MONTHS ENDED JUNE 30, 1999

As described above, the results of the six months ended June 30, 2000
include the results of each of the companies acquired as of June 30, 2000 and
the results of operations for the six months ended June 30, 1999 only include
the results of our accounting predecessor, M&P. As such, unless otherwise noted,
any variances are due to the additional companies included in the results from
the six months ended June 30, 2000.

NET REVENUE. Net revenue increased $50.9 million from $16.8 million for the
six months ended June 30, 1999 to $67.7 million for the six months ended
June 30, 2000.

COSTS OF SALES. Costs of sales increased $42.7 million from $12.9 million
for the six months ended June 30, 1999 to $55.6 million for the six months ended
June 30, 2000.

GROSS PROFIT. Gross profit increased $8.2 million from $3.9 million for the
six months ended June 30, 1999 to $12.1 million for the six months ended
June 30, 2000. Gross profit percentage decreased from 23.4% for the six months
ended June 30, 1999 to 17.8% for the six months ended June 30, 2000. The
decrease is due to higher gross profit percentage that M&P was able to generate
due to mild weather conditions allowing for higher sales volume coupled with
reduced costs of subcontracted labor from the prior year.

GENERAL AND ADMINISTRATIVE EXPENSES. General and administrative expenses
increased $5.6 million from $.8 million for the six months ended June 30, 1999
to $6.4 million for the six months ended June 30, 2000.

INTEREST EXPENSE. Interest expense increased $5.1 million. There was no
interest expense for the six months ended June 30, 1999 as compared to
$5.1 million for the six months ended June 30, 2000. The interest expense was
due to indebtedness incurred in connection with the acquisitions.

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<PAGE>
EQUITY IN INCOME OF INVESTEES. Equity in income of investees increased by
$1.8 million. Equity in income of investees represents our interest in the
income of Telpro, our 49% owned subsidiary. Our equity interest in the
subsidiary was not purchased until subsequent to June 30, 1999 and as such, no
equity in income was recognized for the six months ended June 30, 1999. Upon the
acquisition of the remaining equity interest, Telpro will be consolidated into
our operating results and, as such, we will no longer recognize our equity
interest in its income.

NET INCOME. Net income decreased $2.6 million from $3.2 million for the six
months ended June 30, 1999 to $.6 million for the six months ended June 30,
2000. The decrease was due to the higher gross profit percentages M&P was
experiencing in the prior year as discussed above.

PERIOD ENDED DECEMBER 21, 1999 COMPARED TO YEAR ENDED DECEMBER 31, 1998

NET REVENUE. Net revenue increased $15.0 million or 51.9% from
$28.9 million for the year ended December 31, 1998 to $43.9 for the period ended
December 21, 1999. The increase was due primarily to the addition of a
significant new customer in the broadband industry, as well as an overall
increase in demand for broadband infrastructure services.

COSTS OF SALES. Costs of sales increased $10.0 million or 44.1% from $22.7
for the year ended December 31, 1998 to $32.7 million for the period ended
December 21, 1999. The increase in costs of sales was due to the overall
increase in net revenues resulting in increases in related costs. Costs of sales
did not increase at the rate of the increase in net revenue due to fixed costs
and favorable costs on subcontracted labor.

GROSS PROFIT. Gross profit increased $5.0 million or 80.6% from
$6.2 million for the year ended December 31, 1998 to $11.2 million for the
period ended December 21, 1999. Gross profit percentage increased from 21.5% for
the year ended December 31, 1998 to 25.5% for the period ended December 21,
1999. The increase is primarily attributed to strong gross profit percentage on
the broadband infrastructure revenue increases and higher margins on
subcontracted labor.

GENERAL AND ADMINISTRATIVE EXPENSES. General and administrative expenses
increased $.4 million or 28.6% from $1.4 million for the year ended
December 31, 1998 to $1.8 million for the period ended December 21, 1999. The
increase in general and administrative expenses was primarily due to the
increase in net revenue resulting in increases in related costs.

TRANSACTION-RELATED COSTS. In connection with the sale of M&P to us on
December 21, 1999, M&P incurred $4.5 million in sale related costs during the
period ended December 21, 1999. No costs were incurred during the year ended
December 31, 1998.

INCOME TAXES. Income tax expense as a percentage of income before taxes
increased from 1.1% for the year ended December 31, 1998 as compared to 1.4% for
the period ended December 21, 1999. M&P was a Subchapter S Corporation and as
such, its income was "passed through" to its owners rather than being taxed at
the corporate level. Income taxes represent state replacement income taxes.

NET INCOME. Net income increased $.1 million or 2.1% from $4.8 million for
the year ended December 31, 1998 to $4.9 million for the period ended
December 21, 1999. The increase in net income is due to the overall increase in
gross margins as described above as offset by the one-time expenses incurred for
the sale of M&P.

YEAR ENDED DECEMBER 31, 1998 COMPARED TO THE YEAR ENDED DECEMBER 31, 1997

NET REVENUE. Net revenue increased $6.3 million or 27.9% from
$22.6 million for the year ended December 31, 1997 to $28.9 million for the year
ended December 31, 1998. The increase was due to increased demand for long haul
fiber optic installations.

49
<PAGE>
COSTS OF SALES. Costs of sales increase $6.3 million or 38.4% from
$16.4 million for the year ended December 31, 1997 to $22.7 for the year ended
December 31, 1998. The increase in costs of sales was consistent with the
increase in net revenue.

GROSS PROFIT. Gross profit was $6.2 million for the year ended
December 31, 1997 and $6.2 million for the year ended December 31, 1998. Gross
profit percentage decreased from 27.6% for the year ended December 31, 1997 to
21.5% for the year ended December 31, 1998. The decrease was due to a
significant fiber optic project completed in 1997 that had unusually high gross
margins.

GENERAL AND ADMINISTRATIVE EXPENSES. General and administrative expenses
remained constant, increasing $.1 million from $1.3 million for the year ended
December 31, 1997 to $1.4 million for the year ended December 31, 1998. M&P was
able to service the additional revenue without adding any corporate
infrastructure.

INCOME TAXES. Income tax expense as a percentage of income before taxes
increased from .1% for the year ended December 31, 1997 to 1.1% for the period
ended December 31, 1998. M&P was a Subchapter S Corporation and as such, its
income was "passed through" to its owners rather than being taxed at the
corporate level. Income taxes represent state replacement income taxes.

NET INCOME. Net income decreased $.2 million from $5.0 million for the year
ended December 31, 1997 to $4.8 million for the year ended December 31, 1998
primarily due to the completion a higher margin project in 1997.

SEASONALITY

We often experience reduced revenue in the first quarter of each year
relative to other quarters, in part, because of year-end budgetary spending
patterns of some of our customers and adverse weather conditions as the onset of
winter affects our ability to render external network services in many regions.
Prolonged extreme climate or weather conditions may cause unpredictable
fluctuations in our operating results.

BACKLOG

At June 30, 2000, we had an estimated backlog, including backlog related to
Intercon, of approximately $375.0 million. Our backlog consists of the
uncompleted portion of services we are to perform under job-specific project
contracts over the next twelve months and the estimated amount of work for the
next twelve months we expect to provide under our master service agreements. Due
to the nature of our contractual commitments under our master service
agreements, our customers are not committed to specific volumes of services to
be purchased under a contract, but rather we are committed to perform these
services if requested by the customer. However, the customer is obligated to
obtain these services from us if they are not performed by the customer
internally. Many of the master service agreements are multi-year agreements, and
we include in our backlog the full amount of services projected to be performed
over the next twelve months (unless the contract is terminated earlier) under
these contracts based on our historical relationships with our customers and
experience in procurements of this nature. Historically, we have not experienced
a material variance between the amount of services we expect to perform under
our contracts and the amount actually performed for a specified period. There
can be no assurance, however, as to any customer's requirements during a
particular period or that such estimates at any point in time are accurate.

LIQUIDITY AND CAPITAL RESOURCES

Our principal liquidity requirements are for working capital, consisting
primarily of accounts receivable, costs in excess of billing, accounts payable,
capital expenditures, acquisitions and investments and debt service. Since our
inception, we have funded our operating activities principally from funds
generated from

50
<PAGE>
operations, and we have funded our investing activities principally from funds
provided by equity investments or bank debt.

References to data for the six months ended June 30, 2000 and for the period
from October 19, 1999, which is the date of our inception, to December 31, 1999
relate to our liquidity and capital resources. References for the data for the
period from January 1, 1999 to December 21, 1999 relate to the liquidity and
capital resources of our accounting predecessor, M&P.

Cash flows provided by operations were $7.2 million for 1999. Of these cash
flows provided by (used in) operations, $7.3 million was for the period from
January 1, 1999 to December 21, 1999 and ($.1) million was for the period from
October 19, 1999 to December 31, 1999. Cash flows provided by operating
activities were primarily due to net income and non cash charges for
depreciation and amortization. Cash flows used in operations of $23.4 million
for the six months ended June 30, 2000 were primarily attributable to fundings
to an affiliate of $16.7 million and increases in costs and estimated earnings
in excess of billings on contracts in progress of $13.8 million. The cash flows
used in operations were partially offset by $4.4 million in non-cash
depreciation and amortization and a $3.6 million increase in accrued expenses.

Cash flows used in investing activities were $98.4 million for 1999. Of
these cash flows used in investing activities, $1.3 million related to the
period from January 1, 1999 to December 21, 1999 and $97.1 million related to
the period from October 19, 1999 to December 31, 1999. Cash flows used in
investing activities were primarily due to $97.1 million for the purchase of our
subsidiaries, net of cash acquired, as well as capital expenditures. Cash flows
used in investing activities for the six months ended June 30, 2000 were $103.3
million due primarily to the acquisition of subsidiaries, net of cash acquired,
and investments in affiliated companies during the six months ended June 30,
2000.

Cash flows provided by financing activities were $93.4 million for 1999.
Cash flows provided by (used in) financing activities were $(7.3) million for
the period from January 1, 1999 to December 21, 1999 and $100.7 million for the
period from October 19, 1999 to December 31, 1999. The cash flows from financing
activities were primarily due to proceeds from the issuance of debt of $58.7
million, as well as proceeds from the issuance of stock of $41.4 million. Cash
flows provided by financing activities for the six months ended June 30, 2000
were $126.3 million comprised primarily of proceeds from the issuance of debt of
$77.0 million and proceeds from the issuance of stock of $49.1 million.

We are party to a senior credit facility, which matures on June 16, 2005,
with various lending institutions, and PNC Bank, National Association, as Agent,
which provides for revolving credit borrowings in a maximum principal amount of
$30.0 million, Term Loan A borrowings in a maximum principal amount of
$100.0 million and Term Loan B borrowings in a maximum principal amount of
$100.0 million. Borrowings under the senior credit facility bear interest, at
our option, at PNC's prime rate as announced from time to time, plus a margin,
or LIBOR plus a margin. The applicable margin depends on the type of borrowing,
revolving or term, and our then-current leverage ratio. Our borrowings under the
senior credit facility are secured by substantially all of our assets, including
the stock of our subsidiaries.

The senior credit facility requires us to meet certain financial tests and
contains covenants customary for this type of financing. In addition, covenants
in our senior credit facility require us to use 50% of the proceeds we receive
in specified debt or equity issuances to repay outstanding principal. At
September 6, 2000, there was approximately $213.3 million outstanding and
approximately $16.7 million of unused borrowing capacity under the senior credit
facility. For more information, see "Description of Certain Indebtedness--Senior
Credit Facility."

Our principal sources of funds following the offering are anticipated to be
cash on hand (approximately $5.4 million on a pro forma basis as of June 30,
2000), cash flows from operating activities and borrowings under the senior
credit facility. We believe that these funds will provide us with sufficient
liquidity and capital resources for us to meet our current and future financial
obligations, as well as to provide funds for our working capital, capital
expenditures and other needs for at least the next

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twelve months. No assurance can be given, however, that this will be the case.
We may require additional equity or debt financing to meet our working capital
requirements or to fund our acquisition activities. There can be no assurance
that additional financing will be available when required or, if available, will
be on terms satisfactory to us. Linc.net intends to finance the proposed
Intercon acquisition through a combination of borrowings, and the issuance of
Series A mandatorily redeemable preferred stock and common stock. However, there
can be no assurance that Linc.net will be able to obtain financing for the
acquisition on favorable terms if at all or that the acquisition of Intercon
will be completed on the terms set forth in the Intercon purchase agreement.

MARKET RISK

Market risk is the potential loss arising from adverse changes in market
rates and prices, such as interest rates. We are exposed to changes in interest
rates. All of our debt, including our senior credit facility, is variable rate
debt. Interest rate changes therefore generally do not affect the fair market
value of such debt but do impact future earnings and cash flows, assuming other
factors are held constant. Conversely, for fixed rate debt, interest changes do
not impact future cash flow and earnings, but do impact the fair market value of
such debt, assuming other factors are held constant. Pro forma as of June 30,
2000, we had variable rate debt of approximately $235.1 million. Holding other
variables constant, including levels of indebtedness, a one percentage point
increase in interest rates would have had an estimated impact on pre-tax
earnings and cash flows for the next year of approximately $2.3 million.

We currently have a program in place which covers approximately
$29.8 million of our outstanding indebtedness as of June 30, 2000, for purposes
of reducing our exposure to interest rate fluctuations. On February 28, 2000, we
entered into an interest rate swap agreement with PNC Bank, National
Association. The initial notional principal amount of the agreement was
$31.0 million, with such amount decreasing on a quarterly basis to approximately
$21.9 million on March 1, 2003, when the agreement terminates. This agreement
establishes a fixed rate of 10.55% for such debt. Our policy is not to engage in
derivative transactions in order to profit on interest rate fluctuations.
Instruments and transactions we enter into as a hedge must be effective at
reducing the risks of the exposure being hedged.

INFLATION

The impact of inflation on our business has not been material for the years
ended December 31, 1997, 1998 and 1999 or for the six months ended June 30, 1999
and 2000.

RECENTLY ISSUED ACCOUNTING PRONOUNCEMENTS

In June 1998, the Financial Accounting Standards Board (FASB) issued
Statement No. 133, "Accounting for Derivative Instruments and Hedging
Activities," (FAS 133) which will require all derivatives to be recorded on the
balance sheet at fair value and changes in the fair value of the derivatives to
be recorded in net income or comprehensive income. In June 1999, the FASB issued
Statement No. 137, "Accounting for Derivative Instruments and Hedging
Activities--Deferral of the Effective Date of FASB Statement No. 133" (FAS 137)
that, among other items, defers the date FAS 133 must be adopted to years
beginning after June 15, 2000. Early adoption is permitted. We are currently
evaluating the impact of adopting FAS 133, as amended. However, we do not expect
the adoption of FAS 133 to materially affect our consolidated financial
position, liquidity or results of operations.

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BUSINESS

OVERVIEW

Our objective is to become the leading national provider of end-to-end
network infrastructure services to telecommunications, Internet and cable
television providers by offering our full range of services, either bundled or
separately, under the Linc.net national brand. We have completed ten
acquisitions, building a national presence and a full range of service
offerings. This allows us to market our capabilities and cross-sell our service
offerings to national customers. On August 31, 2000, we agreed to acquire all of
the outstanding capital stock of Intercon, a network infrastructure service
provider operating primarily in the midwestern United States. We will
selectively pursue additional acquisitions to bolster our national presence and
to augment our service offerings.

Our diverse customer base includes incumbent local exchange carriers
(ILECs), competitive local exchange carriers (CLECs), rural exchange carriers,
telecommunications equipment manufacturers, Internet providers, cable television
operators, long distance carriers, wireless communications companies,
co-location facilities providers and public and private energy companies.
Assuming the completion of the Intercon acquisition, at September 6, 2000,
Linc.net had approximately 3,700 employees, including over 400 network engineers
and over 700 network technicians.

INDUSTRY BACKGROUND

We believe the following factors will generate increasing demand for our
services:

DEMAND FOR BANDWIDTH. The continued increase in telecommunications voice
and data traffic and the emergence of the Internet as a global medium for
communications and commerce have strained existing network capacity and created
a significant demand for additional transmission capacity, or bandwidth. Both
the number of Internet users and Internet use are expected to continue to rise
significantly, as businesses continue to adopt electronic business models.
International Data Corporation estimates that the number of worldwide Internet
users will reach approximately 327 million by year-end 2000 and surpass
600 million by 2003. In addition, Forrester Research estimates that
business-to-business e-commerce in the United States will reach $2.7 trillion
per year by 2004, while consumers in the United States will use the Internet to
purchase approximately $184 billion of goods and services online annually by
2004. At the same time, as new technologies and applications develop to support
the richer, more robust information exchanges that businesses and their
consumers seek, they will challenge existing network capabilities, further
stressing much of the existing infrastructure. Pioneer Consulting, LLC estimates
that Internet bandwidth demand alone in North America will grow at a 122%
compound annual growth rate between 1999 and 2004. We believe that, to meet the
demands of their customers and to remain competitive, telecommunications,
Internet and cable television providers will continue to expand, upgrade and, in
many cases, replace their network infrastructures to deliver additional
bandwidth.

RAPIDLY CHANGING TECHNOLOGIES. To meet the demand for increased bandwidth
and functionality, telecommunications providers continue to replace or upgrade
their network equipment, particularly in the network hubs, or central offices,
located throughout their service areas. Central offices are made up of equipment
using complex networking technology, and, like other technologies, the speed,
capacity and other capabilities of this equipment continue to evolve rapidly.
Because technology advances allow

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network providers to deliver more bandwidth and enhanced services in a more
reliable and cost-effective manner, they frequently replace existing equipment
with newer, more sophisticated technologies as they become available, increasing
demand for equipment engineering and installation services. Given the current
state of network equipment technology and the magnitude of the demand for
network traffic and performance, we believe that networking equipment will
continue to evolve rapidly and that the life cycle for this equipment will
continue to shorten.

LARGE INVESTMENTS NECESSARY TO OVERCOME THE LAST MILE BOTTLENECK. While the
volume and breadth of information generated by Internet applications and other
broadband services continue to increase, network providers need to supply
additional bandwidth to end-users in the local access network, or last mile. It
is believed that the current copper-based infrastructure of the last mile,
designed to carry voice traffic, will not accommodate the growing bandwidth
requirements. As a result, many end-users, especially residential and small
business customers, have only a limited ability to take advantage of advanced
broadband offerings. In order to maintain and better serve a large customer
base, some network providers are undertaking investment projects designed to
enhance the capabilities of their existing infrastructure, while others are
replacing their networks with a more modern infrastructure. In 1998 alone, local
exchange carriers reported to the FCC that they invested over $11.1 billion in
fiber optic infrastructure. The FCC estimates, however, that, as of
December 31, 1998, approximately 91% of the total miles of infrastructure owned
by local exchange carriers were still copper-based. Given the rising demand for
bandwidth and the relatively early stage of upgrades in the last mile, we
believe that network providers will continue to make heavy investments in
upgrading the capabilities of the local access network.

INCREASED DEMAND FOR OUTSOURCED INFRASTRUCTURE SERVICES. Technological
advances accompanied by deregulation are driving a technological convergence and
consolidation of the telecommunications, Internet and cable television
industries. At the same time, deregulation and competitive demand in these
industries has led to significant additional investment by new and existing
network providers. Because of an overall skill shortage and the rapidly changing
technology and industry landscape, network providers have increasingly found it
more cost-effective to use outside providers for high-quality engineering,
installation and management services, allowing them to focus their internal
resources on core business competencies. We believe that, in selecting network
infrastructure service providers, these companies will increasingly turn to the
few qualified service providers who have the size, financial capability,
geographical scope and broad technical expertise to engineer, manage the
installation of and deploy high-quality network solutions in a timely and
cost-efficient manner.

THE LINC.NET SOLUTION

END-TO-END OFFERINGS. We provide our customers with a full range of network
infrastructure service offerings, including engineering, installation and
maintenance of central office equipment as well as infrastructure design,
deployment and program management. We provide these services either individually
or as a fully integrated, end-to-end bundled offering that we market as Linc.net
e-net Solutions(SM). This end-to-end approach allows our customers to engage a
single party who is responsible for all facets of a network installation project
and reduces inefficiencies associated with coordinating multiple vendors. Our
Linc.net e-net Solutions(SM) are designed to be highly replicable, but can also
be customized to meet the needs of a particular customer. We provide
comprehensive program management services and follow industry best practices in
the management and delivery of all of our services to ensure a consistent level
of quality and reliability across service offerings and geographic areas. Our
central office installation business unit is in the process of obtaining ISO
9002 and TL9000 quality certifications, and we intend to pursue additional
certifications for our other business units as appropriate. We believe our full
range of

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independent and integrated network service offerings, program management
practices and adherence to quality and industry best practices allow us to
successfully deliver complex, end-to-end network infrastructure solutions in a
timely and cost effective manner.

NETWORK INFRASTRUCTURE TECHNOLOGY LEADERSHIP. We offer our customers
advanced network infrastructure services using the best available technology and
practices, providing proven and reliable solutions to address complex network
infrastructure issues. As a national service provider, we work with multiple
products and technologies and remain independent of any particular vendor and
technology, allowing us to recommend and deploy those components that best
address a customer's particular network infrastructure needs. Our business units
have an established history of providing services to customers that use complex
multi-vendor network technologies. We have maintained our technology leadership
primarily by recording and disseminating the important practical experiences
that come from successfully servicing a technologically sophisticated customer
base and by focusing on training and developing our engineers and technicians.
In addition, we are able to leverage our strong customer relationships to gain
early access to new products and technologies and an understanding of their
applicability to actual network problems and issues. We believe that our
technology leadership allows us to quickly, accurately and cost-effectively
address the complex and critical network infrastructure issues that face our
customers.

NATIONAL PRESENCE. Convergence and consolidation among telecommunications,
Internet and cable television providers have generated demand for infrastructure
service providers that can quickly respond to their needs on a national basis.
We provide our services through regional and national specialty hubs, giving us
a strong geographic presence in many key markets and the ability to promptly,
economically and consistently respond to our customers needs for network
infrastructure engineering, deployment and management services virtually
anywhere in the United States. In addition, our national presence offers
customers a single source for high-quality engineering, design, implementation
and management of network technology and infrastructure solutions across
geographies. We believe that our ability to provide a full range of services on
a national basis allows us to more rapidly and efficiently address the needs of
our customers as they continue to converge and consolidate.

INDUSTRY EXPERTISE. Our chief executive officer, Ismael Perera, has spent
his entire professional career in the telecommunications industry and brings to
Linc.net over 30 years of industry experience in network design, deployment and
maintenance. In addition, our business units have a history of successfully
delivering high-quality services to telecommunications, Internet, cable
television and energy companies. The leaders of our various business units have
an average of approximately 25 years of industry experience. As a result of
these factors, we believe that we have a keen insight into industry dynamics,
which gives us a competitive advantage and allows us to offer our customers high
quality and cost-effective services.

OUR BUSINESS STRATEGY

EXPAND LEADERSHIP POSITION IN KEY MARKETS. We believe that we have a
leadership position in three key markets: network infrastructure engineering,
central office installation and last mile deployment. We believe these are
particularly important growth segments of our market due to the rapidly changing
nature of network technology and the need for increased bandwidth delivered to
the end user. We plan to focus our resources on these key markets to expand our
leadership positions.

ESTABLISH LINC.NET BRAND. We intend to create a strong national brand under
which we will offer end-to-end network infrastructure solutions through our
system of regional and national specialty hubs. We also intend to leverage our
existing single service customer relationships by aggressively and
systematically cross-selling other services we do not currently provide to them,
including our Linc.net e-net

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Solutions(SM) bundled package of service offerings. To that end, we have
established a corporate-level marketing department supported by dedicated
regional marketing specialists to market our services to as broad a customer
base as possible.

ATTRACT, RETAIN AND TRAIN HIGHLY SPECIALIZED WORK FORCE. We devote
significant resources and attention to the recruitment and retention of highly
skilled employees. We plan to centralize the administration and policies
surrounding our benefits and human resource functions, enabling us to provide
consistent and competitive benefits and relocation opportunities. We also plan
to provide for formal training and development of our engineers, technicians and
other employees to continuously improve their technical and industry expertise,
further their career objectives and provide them with compelling opportunities
and challenges.

LEVERAGE RESOURCES AND KNOWLEDGE ACROSS BUSINESS UNITS. We intend to
leverage the substantial experience and resources of our various business units
across our organization to ensure cost-effective, efficient and high-quality
delivery of services to our customers. For example, we have established an
Executive Management Council, or EMC, composed of our chief executive officer,
chief financial officer and each of our business unit leaders. The EMC actively
formulates, disseminates and enforces processes, procedures and practices to
ensure the use of best practices throughout our organization, allowing the
entire organization to benefit from shared knowledge.

SELECTIVELY PURSUE STRATEGIC ACQUISITIONS. We will selectively pursue
strategic acquisitions to round out our geographic coverage and to complement
our existing service offerings. We will seek out acquisition candidates with
strong financial performance and experienced management teams that will be
compatible with our corporate culture and operating philosophy.

SERVICE OFFERINGS

We provide a broad array of services to our customers, from system design of
both wireline and wireless telecommunications networks, to long-term system
maintenance and upgrade. As a result, our customers can look to Linc.net and our
Linc.net e-net Solutions(SM) for total program management and system deployment
responsibility. The services we offer our customers include:

PROGRAM MANAGEMENT. Complex wireless and wireline communications projects
require a significant degree of coordination and execution in order to ensure a
quality network solution is provided in a timely manner. Our project managers
lead a team in defining, planning, laying out and coordinating every phase of
the network project. We use advanced software that creates plans, schedules
jobs, tracks progress and generates status reports to keep our customers
apprised of our progress.

ENGINEERING. Our engineers design leading-edge communications systems for
telecommunications, Internet, cable television and energy providers. Our staff
of over 400 engineers performs feasibility and economic studies, field surveys,
strand mapping, permitting and right-of-way acquisition, feeder and distribution
design, self-healing fiber ring and local- and wide-area networks and wireless
communications network design. We also design layouts for central office
facilities, including equipment configuration and cable routing.

CENTRAL OFFICE EQUIPMENT INSTALLATION. Our staff of over 700 technicians
installs central office network equipment, including multiplexers, digital
cross-connect terminals and digital subscriber line (DSL) and other equipment
for incumbent and competitive local exchange carriers, long-haul carriers,
Internet and wireless service providers. Our independence from particular
technologies and equipment vendors has allowed us to gain experience in all
major network technologies and equipment used in the central office.

NETWORK INFRASTRUCTURE INSTALLATION. We provide network infrastructure
installation for our customers in a variety of contexts, including fiber optic
long-haul and local access network, Internet and cable television, wireless and
electric distribution. We use a variety of advanced techniques, including
directional

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drilling, which allows us to bore underneath city streets, rivers and other
obstacles, and highly specialized equipment to cut through rock. We also install
conduit and manholes in congested downtown areas and aerial and/or buried cable
infrastructure in residential and commercial areas.

OUR ORGANIZATION

We have built the company around four functional platforms or national
specialties. One of these functional platforms is our network infrastructure
engineering group. UCI serves as the foundation for this group. The second is
our central office equipment engineering, furnishing and installation group.
Telpro serves as the foundation for this group. The third is our wireless
communications infrastructure services group. CLS serves as the foundation for
this group.

Our last group focuses on infrastructure deployment, or installation,
services. We have organized this group into four regional hubs, with satellite
operations located in strategic areas. These hubs currently consist of the:

- Central Region Installation Group. M&P serves as the foundation for this
group. In addition, NSC, with expertise in the installation of broadband
communications networks, also operates in this group. Finally,
Communicor's Minneapolis operation provides last mile installation
expertise in this group.

- Southwest Region Installation Group. C&B serves as the foundation for the
Southwest Region Installation Group. In addition, this group is comprised
of George M., which complements this group with expertise in last mile
installation services in the Houston and Austin areas, Craig, which
provides expertise in rock sawing, and Communicor's Phoenix operation,
which provides last mile installation expertise in Arizona.

- Eastern Region Installation Group. Felix and its affiliates serve as the
foundation for this group.

- Great Lakes Region Installation Group. We expect that Intercon will serve
as the foundation for this group.

We will selectively pursue additional strategic acquisitions to round out
our geographic coverage and to complement all of our existing functional
platforms. From time to time, we enter into letters of intent with potential
acquisition targets. There can be no guarantee that any such potential
acquisitions will be consummated.

SALES AND MARKETING

We serve many customers in the telecommunications, Internet, cable
television and energy industries. We have developed a marketing plan to
establish the "Linc.net" brand name nationally, emphasizing our role as a
leading national provider of end-to-end network infrastructure services. We
market our end-to-end offerings as Linc.net e-net Solutions(SM).

Our business units have nurtured longstanding relationships with their
respective customers. Under our new marketing plan, we intend to continue to
benefit from the current state of each relationship, but we also plan to expand
our opportunities within each. To that end, we have established a corporate
marketing department which is responsible for developing and executing the
overall marketing strategy, including the development of marketing materials and
interaction with key national accounts. This corporate-level team is supported
by regional marketing specialists that are responsible for interacting with and
cross-selling to customers in their assigned regions or specialties.

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CUSTOMERS

Our customers include:

<TABLE>
<S> <C>
- incumbent local exchange carriers - competitive local exchange carriers
- cable television operators - rural exchange carriers
- wireless communications providers - long distance carriers
- co-location facilities providers - telecommunications equipment vendors
- Internet providers - public and private energy companies
</TABLE>

Representative customers based on revenue for the pro forma year ended
December 31, 1999 and for the pro forma six months ended June 30, 2000 are:

<TABLE>
<S> <C>
Consolidated Edison Williams Communications
Pacific Bell Media One
U. S. West KMC Telecom
Level 3 Communications PF.Net
Port St. Lucie Gilbert Network Services
Reliant Energy Time Warner
Southwestern Bell BellSouth
</TABLE>

Consolidated Edison, Pacific Bell and US West accounted for approximately
10%, 6% and 6% of our revenue for the pro forma year ended December 31, 1999.
Level 3 Communications, Consolidated Edison and Williams Communications
accounted for approximately 11%, 8% and 7% of our revenue for the pro forma six
months ended June 30, 2000. Our top 10 customers combined accounted for
approximately 41% of our revenue for the pro forma year ended December 31, 1999
and 56% of our revenue for the pro forma six months ended June 30, 2000. We
believe that a substantial portion of our contract revenue and operating income
will continue to be derived from a concentrated group of customers.

A significant amount of our business is performed under master service
agreements. These agreements with telecommunications providers are generally
exclusive requirement contracts, with certain exceptions, including the
customer's option to perform the services with its own regularly employed
personnel. The agreements are typically two to three years in duration, although
the terms typically permit the customer to terminate the agreement upon 90 to
180 days prior notice. These contracts generally contemplate hundreds of
individual construction and maintenance projects valued at less than $100,000
each.

We bid on other jobs on a nonrecurring basis. As a result, the amount and
type of work we perform at any given time and the general mix of customers for
which we perform work may vary significantly from quarter to quarter.

SUPPLIERS

Our customers supply the majority of the materials and supplies we require
to complete our contracted work, although we are increasingly finding ourselves
in the position of supplying various materials on end-to-end projects. We obtain
these materials for our own account from independent third-party providers and
do not manufacture any materials or supplies for resale. We are not dependent on
any one supplier for any materials or supplies that we obtain for our own
account.

In addition, we use independent contractors to augment our workforce when
needed. These independent contractors typically are sole proprietorships or
small business entities. Independent contractors typically provide their own
employees, vehicles, tools and insurance coverage. We are not dependent on any
single independent contractor.

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COMPETITION

The markets in which we operate are highly competitive. Our competitors
include small, independent firms servicing local markets, larger firms servicing
regional markets and large national and international engineering firms and
telecommunications equipment vendors on end-to-end projects who subcontract work
to contractors other than Linc.net. Despite the current industry trend toward
outsourcing various network infrastructure services, we may also face
significant competition from existing or prospective customers who employ their
own personnel to perform many of the same types of services as we provide. There
are relatively few significant barriers to entry into the markets in which we
operate and, as a result, any organization that has adequate financial resources
and access to technical expertise may become one of our competitors. Although we
believe we are one of the largest providers of end-to-end network infrastructure
services for telecommunications and other companies in the United States,
neither we nor any of our competitors can be considered a dominant player in the
industry.

We believe that the principal competitive factors in our market include
pricing, quality and responsiveness of service, technical expertise, industry
experience, geographic diversity, reputation and the ability to deliver results
on time. Of these, pricing has historically been an important competitive
factor. In addition, expertise in new and evolving technologies has become
increasingly important. We believe that we can compete favorably on each of
these factors.

REGULATION AND ENVIRONMENTAL MATTERS

Our operations are subject to various federal, state and local laws and
regulations including:

- licensing requirements,

- building and electrical codes,

- permitting and inspection requirements applicable to construction projects
and

- regulations relating to labor relations, worker safety and environmental
protection.

We believe that we have all material licenses and permits required to
conduct our operations and that we are in substantial compliance with all
applicable regulatory requirements. Any failure by us to comply with applicable
rules and regulations could result in substantial fines or revocation of the
licenses or permits under which we operate. Many state and local regulations
governing electrical construction require permits and licenses to be held by
individuals who have passed an examination or met other requirements.

In addition, many of our facilities and operations are subject to federal,
state and local environmental and occupational health and safety requirements,
including those related to discharges of substances to the air, water and land,
the handling, storage and disposal of wastes and the clean-up of properties
affected by pollutants. Any failure by us to comply with these requirements
could result in substantial civil and criminal penalties. Our executives and
safety department share responsibility for overseeing our compliance with
environmental regulations.

We could also incur liability under the Comprehensive Environmental
Response, Compensation, and Liability Act, or CERCLA, also known as the
"Superfund" law. CERCLA imposes liability, without regard to fault or the
legality of the original conduct, on classes of persons who are considered to
have contributed to the release of hazardous substances into the environment.
Persons who are responsible under CERCLA may be subject to joint and several
liability for environmental cleanup costs and for damages to natural resources.
In the future, contamination may be found to exist at our facilities or off-site
locations where we have sent wastes. We could be held liable under CERCLA or
other similar laws for environmental cleanup costs associated with such
contamination.

We currently operate a fill material transfer station in The Bronx,
New York under a temporary permit from the New York City Department of
Sanitation (the "Department"). We use the transfer station

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for the temporary storage of material excavated during our installation and
other construction operations in the New York City area. The Department has
requested that we obtain a final permit for the Bronx transfer station. As a
condition to obtaining a final permit, the Department has requested an
environmental impact assessment of the transfer station operations. There is no
guarantee that the Department will ultimately grant the final transfer station
permit. If the Department does not issue a final permit, the Department may
require that we close the transfer station. We do not expect that the closure of
the Bronx transfer station, if required, will have a material adverse effect on
our business, financial condition or results of operations. Furthermore, we will
be indemnified by the sellers of Felix and its affiliates for all costs, if any,
to close the Bronx transfer station and address any environmental contamination
at that location.

We believe we are in substantial compliance with current applicable
environmental laws and regulations and that continued compliance with existing
requirements will not have a material adverse effect on our business, financial
condition and results of operations. We do not anticipate material capital
expenditures for environmental controls in this or the succeeding fiscal year.
Furthermore, we are not aware of any pending or threatened environmental
lawsuits, fines or enforcement actions that could have a material adverse effect
on us. Public interest in protecting the environment, however, has increased
dramatically in recent years. Therefore, if laws are enacted or other
governmental actions are taken that impose additional environmental protection
requirements, our business prospects could be adversely affected to the extent
that our environmental compliance costs increase.

SAFETY AND INSURANCE

Performance of certain aspects of our work requires the use of equipment and
exposure to conditions that can be dangerous. For example, excavation projects
and work conducted in close proximity to power lines pose particular dangers to
both our equipment and employees. We are committed to ensuring that our
employees perform their work safely and strive to instill safe work habits in
all of our employees. In this regard we evaluate our employees not only on the
basis of the efficiency and quality of their work but also on their safety
records and the safety records of the employees they supervise. We also hold
regular training sessions and seminars with our employees devoted to safe work
practices. Although we are committed to a policy of operating in a safe manner,
we may be subject to claims by employees, third-parties and customers for
property damage and personal injuries resulting from the performance of our
services.

The primary claims we face in our operations are workers' compensation,
automobile liability and various general liabilities. We maintain automobile and
general liability insurance for third-party bodily injury and property damage
and workers' compensation coverage which we consider sufficient to insure us
against these risks. We have consolidated many of the insurance programs of our
operating companies, which has resulted in savings from amounts historically
paid by these units before their acquisition by us.

EQUIPMENT AND FACILITIES

We operate a fleet of owned and leased trucks and trailers, support vehicles
and specialty installation equipment, such as backhoes, trenchers, generators,
directional drilling machines, aerial lifts and air compressors. The total size
of the equipment fleet is approximately 2,300 units. We believe that these units
generally are well-maintained and adequate for our present operations. We
believe that in the future, we will be able to lease or purchase this equipment
at favorable prices due to our larger size and the volume of our leasing and
purchasing activity.

Our corporate headquarters is located in leased space in Miami, Florida. We
also have regional and specialty headquarters in leased space in San Ramon,
California, Atlanta, Georgia, Edmond, Oklahoma, Lincolndale, New York, Hamel,
Minnesota and Mineral Wells, Texas. As of August 1, 2000, the total leased area
for our corporate headquarters and regional and specialty headquarters is
approximately 53,820

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square feet and the total annual base rent for these facilities is approximately
$603,432. The leases for these facilities have terms ranging from month-to-month
to five years. None of the individual leases is material to our operations. We
also lease various district field offices, equipment yards, shop facilities and
temporary storage locations and other smaller properties as necessary to enable
us to efficiently perform our obligations under master service agreements and
other contracts. We believe that our facilities are generally adequate for our
needs. We do not anticipate difficulty in replacing such facilities or securing
additional facilities, if needed. All of our owned properties and equipment and
our leases are pledged to secure repayment of our senior credit facility.

EMPLOYEES

Assuming the completion of the Intercon acquisition, as of September 6,
2000, Linc.net had approximately 3,700 employees, including over 400 network
engineers and over 700 network technicians. Approximately 780 of those employees
are represented by labor unions, principally the International Brotherhood of
Electrical Workers or the Laborers International Union of North America, under
multi-employer agreements with wage rates established through dates ranging from
April 30, 2001 to May 31, 2003. We believe that our employee relations are good.

LEGAL PROCEEDINGS

We are from time to time party to litigation, administrative proceedings and
union grievances that arise in the ordinary course of our business. We do not
have pending any litigation that, separately or in the aggregate, would in the
opinion of management have a material adverse effect on our results of
operations or financial condition.

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MANAGEMENT

DIRECTORS, EXECUTIVE OFFICERS AND KEY EMPLOYEES

The following table sets forth our executive officers, directors and key
employees, their ages and the positions they hold:

<TABLE>
<CAPTION>
NAME AGE POSITION
---- -------- ------------------------------------------
<S> <C> <C>
Ismael Perera............................. 51 President and Chief Executive Officer,
Director

Daniel F. Harrington...................... 44 Senior Vice President, Chief Financial
Officer, Secretary

Emilio Alfonso............................ 38 Vice President and Controller, Assistant
Secretary

Patrick L. Adams.......................... 44 President--Wireless Infrastructure Group

Deborah Clark............................. 48 President--Southwest Region Installation
Group, Director

Irvin L. Gunter........................... 55 President--Network Engineering Group

Larry Jordan.............................. 54 President--Central Office Equipment
Installation Group

Felix M. Petrillo......................... 60 President--Eastern Region Installation
Group

Lawrence L. Pribyl........................ 53 President--Central Region Installation
Group

Kenneth Keiffer........................... 36 Vice President--Corporate Development

H. Andrew Pyron........................... 45 Vice President--Marketing

H. Douglas White, Jr...................... 54 Vice President--Human Resources

Burton E. McGillivray..................... 43 Chairman of the Board

William S. Antle.......................... 55 Director

Timothy B. Armstrong...................... 29 Director

Richard W. Detweiler...................... 58 Director

John F. Megrue, Jr........................ 42 Director

Paul L. Whiting, Jr....................... 31 Director
</TABLE>

In connection with our application to list our common stock on the NYSE, we
expect to undertake to appoint at least one additional director not otherwise
affiliated with us or any of our stockholders within 90 days following the
offering. Linc.net, LLC, an affiliate of Banc One Equity Capital, and SKM
Linc.net, LLC, an affiliate of SKM, have entered into a stock purchase agreement
pursuant to which they will coordinate their vote with respect to the election
of our directors.

ISMAEL PERERA is our President and Chief Executive Officer and a director,
and has held these positions since our inception in 1999. Prior to joining our
company, Mr. Perera spent six years with MasTec, Inc., a network infrastructure
services provider, and its predecessors, as Senior Vice President--Operations.
Prior to joining MasTec, Mr. Perera spent over 23 years with BellSouth with
responsibilities for network design, deployment and maintenance.

DANIEL F. HARRINGTON is our Senior Vice President, Chief Financial Officer
and Secretary and has held these positions since May 2000. Mr. Harrington has
over 21 years of experience in finance and accounting. Most recently, from 1999
to 2000, he was the Vice President of Finance of Lasertron, Inc., a subsidiary
of Oak Industries. Prior to his position with Lasertron he was Vice President,
CFO and Treasurer of Diatide, Inc., a bio-pharmaceutical company from 1996 to
1999. Prior to his position at Diatide,

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Mr. Harrington served as Chief Financial Officer of GenRad, Inc., an electronic
systems and software company during 1996 and as Vice President of Financial
Planning and Analysis during 1995. From 1987 to 1995, Mr. Harrington was
Director of Operations, Finance & Logistics at Waters Corporation, an analytical
instrument, medical device and software company.

EMILIO ALFONSO is our Vice President and Controller and has held this
position since May 2000. Prior to that time, Mr. Alfonso was Director of Finance
for Lennar Corporation from March 1998 to May 2000. Mr. Alfonso held various
positions with Ryder System, Inc. from 1994 to 1998, the last of which was
Director of Financial Reporting. Prior to joining Ryder System, Inc.,
Mr. Alfonso was a Senior Manager with Ernst & Young LLP.

PATRICK L. ADAMS is our President-Wireless Infrastructure Group and has held
this position since our acquisition of CLS in October 1999. Mr. Adams has been
with CLS since 1976, and became part owner in 1985. He became President of CLS
in 1994.

DEBORAH CLARK is our President-Southwest Region Installation Group and a
director and has held these positions since our acquisition of C&B Associates
and its affiliates in December 1999. Ms. Clark has been with C&B since 1987. She
became President of C&B Associates II, Ltd in 1997. Prior to that time,
Ms. Clark held the position of Vice President.

IRVIN L. GUNTER is our President-Network Engineering Group and has held this
position since our acquisition of Utility Consultants, Inc. in May 2000.
Mr. Gunter has over 31 years of experience in the engineering of
telecommunications networks. He was the President of UCI from 1984 to 2000.

LARRY JORDAN is our President-Central Office Installation Group and has held
this position since our acquisition of Telpro Technologies, Inc. in March 2000.
Mr. Jordan was one of the co-founders of Telpro in 1990, and served as its
Executive Vice President and Chief Operating Officer until 1998, when he became
President. Prior to that time, Mr. Jordan spent 20 years at Pacific Bell in
positions of increasing responsibility for all facets of installation and
maintenance of central office equipment.

FELIX M. PETRILLO is our President-Eastern Region Installation Group and has
held this position since our acquisition of Felix Industries and its affiliates
in August 2000. Mr. Petrillo founded Felix Industries in 1979 and has served as
its President since its inception.

LAWRENCE L. PRIBYL is our President-Central Region Installation Group and
has held this position since our acquisition of M&P Utilities, Inc. and its
affiliates in December 1999. Mr. Pribyl was a co-founder of M&P in 1973 and
served as its Vice President of Operations from 1973 to 2000.

KENNETH KEIFFER is our Vice President of Corporate Development and has held
this position since June 2000. Prior to that time, Mr. Keiffer served as
Vice-President of Operations for Sampco Inc., a designer and manufacturer of
building material samples, from October 1998 to June 2000. Prior to joining
Sampco Inc., Mr. Keiffer was Director of Venture Capital Investments for
Holualoa Companies, a commercial real estate investment group, from
January 1998 to October 1998. Prior to that time, Mr. Keiffer was Corporate
Controller and Director of Finance for Satcon Technology Corporation, an
electro-magnetic component research and development company, from January 1993
to January 1998.

H. ANDREW PYRON is our Vice President of Marketing and has held this
position since December 1999. Prior to that time, Mr. Pyron was National
Accounts Manager for Ritchie Brothers Auctioneers, an international construction
equipment management and disposal company, from October 1998 to December 1999.
Before joining Ritchie Brothers Auctioneers, Mr. Pyron was Division
Vice-President for Ditch Witch of Georgia, an equipment sales and maintenance
provider, from January 1997 to October 1998. Prior to that time, Mr. Pyron was
Vice-President of Equipment Services for MasTec Inc., a network infrastructure
services provider, from 1994 to 1997.

H. DOUGLAS WHITE, JR. is our Vice President of Human Resources and has held
this position since August 2000. Prior to that time, Mr. White was Director of
Employee Services at Comcast Corporation, a

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national provider of cable television services, from 1995 to August 2000. Prior
to that time, Mr. White was Director of Benefit and Insurance for Comcast from
1992 to 1995.

BURTON E. MCGILLIVRAY has been a member of our board of directors since our
inception in 1999. Mr. McGillivray has been a senior executive with First
Chicago Equity Capital, the predecessor of Banc One Equity Capital, from January
1994 to the present. Mr. McGillivray is also a member of Cross Creek
Partners IX, L.L.C. ("Cross Creek IX"), Cross Creek Partners X, L.L.C. ("Cross
Creek X") and Cross Creek Partners X-A, L.L.C. ("Cross Creek X-A"), which are
co-investors with Banc One Equity Capital and whose members are current and
former executives of Banc One Equity Capital. From January 1993 until December
1993, Mr. McGillivray was a Chicago-based private investor. From September 1984
to December 1992, Mr. McGillivray was employed by Continental Illinois Venture
Corporation ("CIVC") and Continental Equity Capital Corporation ("CECC"). He
served as Managing Director of both CIVC and CECC from 1989 to 1992. The primary
business of CIVC, CECC and Banc One Equity Capital is making equity investments
in high-growth businesses. Mr. McGillivray is also a director of Alpha
Technologies, Aviation Systems International and Taylor Precision Products.

WILLIAM S. ANTLE has been a director since June 2000. Mr. Antle is former
Chairman of the Board and Chief Executive Officer of Oak Industries Inc., a
manufacturer of coaxial broadband connector products, fiber optic components and
other products, from 1996 until January 2000 when the company was acquired by
Corning, Inc. Prior to that time, he was President and Chief Executive Officer
of Oak Industries from 1989 to 1996 and served with Bain and Company, Inc., an
international strategy consulting firm, from 1980 to 1989. Mr. Antle is also a
director of INVESST, GenRad, Inc., Osco Technologies and John H. Harland Co.

TIMOTHY B. ARMSTRONG has been a member of our board of directors since our
inception in 1999. Mr. Armstrong joined Saunders Karp & Megrue, L.P. as an
associate in 1996 and became a Principal at the end of 1999. Prior to joining
Saunders Karp & Megrue, Mr. Armstrong worked in the Financial Entrepreneurs
Group at Smith Barney Inc., from July 1994 to June 1996.

RICHARD W. DETWEILER has been a member of our board of directors since our
inception in October 1999. Mr. Detweiler has been a managing director and part
owner of Carlisle Enterprises, LLC, a private investment firm, since 1996. Prior
to that time, Mr. Detweiler was Chairman and Chief Executive Officer of
Precision Aerotech, Inc., a diversified manufacturing company, from 1990 to
1996. Mr. Detweiler has also held executive management positions with
Caterpillar, Sundstrand Corporation and International Harvester.

JOHN F. MEGRUE, JR. has been a member of our board of directors since our
inception in 1999. Since 1992, Mr. Megrue has been a Partner of SKM, a private
equity investment firm, and a member of: Saunders Karp & Megrue Partners,
L.L.C., the general partner of SKM Partners, L.P., the general partner of SKM
Equity Fund II, L.P. ("SKM Equity II") and SKM Investment Fund II ("SKM
Investment II"); and SKM Partners, L.L.C., the general partner of SKM Equity
Fund III, L.P. ("SKM Equity III") and SKM Investment Fund ("SKM Investment").
From 1989 to 1992, Mr. Megrue served as a Vice President and Principal at
Patricof & Co., a private equity investment firm. Mr. Megrue also serves as Vice
Chairman and director of Dollar Tree Stores, Inc and director of The Children's
Place Retail Stores, Inc. and Chairman and director of Hibbett Sporting
Goods, Inc.

PAUL L. WHITING, JR. has been a member of our board of directors since our
inception in 1999. Mr. Whiting is an executive with Banc One Equity Capital,
formerly First Chicago Equity Capital. He has been with Banc One Equity Capital
since 1997. Mr. Whiting is also a member of Cross Creek IX, Cross Creek X and
Cross Creek X-A, which are co-investors with Banc One Equity Capital. In 1996,
Mr. Whiting was an associate with The Parthenon Group, a strategic advisory and
principal investment firm. From 1992 to 1995, Mr. Whiting was an analyst and an
associate with CIVC. Mr. Whiting is also a director of Alpha Technologies and
Aviation Systems International.

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<PAGE>
In addition, we anticipate that, after completion of the Intercon
acquisition, Jack Gabrielse will serve as the President of the newly formed
Great Lakes Region Installation Group. Mr. Gabrielse, a founder of Intercon in
1984, has served as its President since 1993.

There are no family relationships between any of our directors or executive
officers. Our executive officers are elected by and serve at the discretion of
the board of directors pursuant to employment contracts entered into with us.

Prior to the completion of this offering and except as described in the
paragraph below, our board of directors will be divided into three classes, as
nearly equal in number as possible, with each director serving a three-year term
and one class being elected at each year's annual meeting of stockholders.
Mr. Antle will be in the class of directors whose term expires at the 2001
annual meeting of our stockholders. The additional director anticipated to be
appointed by our board will also be in the class of directors whose term expires
at the 2001 annual meeting of our stockholders. Messrs. Armstrong, Detweiler and
Whiting will be in the class of directors whose term expires at the 2002 annual
meeting of our stockholders. Messrs. McGillivray, Megrue and Perera will be in
the class of directors whose term expires at the 2003 annual meeting of our
stockholders. At each annual meeting of our stockholders, successors to the
class of directors whose term expires at such meeting will be elected to serve
for three-year terms and until their respective successors are elected and
qualified.

In addition, we have established an Executive Management Council, or EMC,
which is composed of our chief executive officer, chief financial officer and
each of our business unit leaders. The EMC formulates, disseminates and enforces
processes, procedures and practices throughout our organization. One member of
our board of directors shall be elected and designated as the EMC director. The
EMC director will rotate on an annual basis, allowing individuals who are
members of the EMC and not already on our board to serve as directors. The EMC
director will be elected at each annual meeting of our stockholders. Deborah
Clark is the current EMC director.

EXECUTIVE COMPENSATION

The following table sets forth information concerning the compensation for
the year ended December 31, 1999 for our chief executive officer. There were no
other executive officers who we paid more than $100,000 in 1999.

SUMMARY COMPENSATION TABLE

<TABLE>
<CAPTION>
LONG-TERM
ANNUAL COMPENSATION
COMPENSATION AWARDS
---------------------------------------------- ------------
OTHER ANNUAL SECURITIES ALL OTHER
FISCAL COMPENSATION UNDERLYING COMPENSATION
NAME AND PRINCIPAL POSITION YEAR SALARY BONUS ($) ($)(1) OPTIONS ($)
--------------------------- -------- -------- --------- ------------ ------------ ------------
<S> <C> <C> <C> <C> <C> <C>
Ismael Perera ................... 1999 $52,083 -- -- -- --
President and Chief Executive
Officer
</TABLE>

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

(1) None of the perquisites and other benefits paid to Mr. Perera exceeded the
lesser of $50,000 or 10% of the total annual salary and bonus received by
him.

We have entered into employment agreements with Messrs. Perera, Harrington
and Alfonso, which provide for annual salaries of $275,000, $225,000 and
$140,000. For more information about these employment agreements, see
"--Employment Agreements."

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<PAGE>
COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION

The compensation arrangements for each of our executive officers was
established pursuant to the terms of the respective employment agreements
between us and each executive officer. The terms of the employment agreements
were established pursuant to arms-length negotiations between representatives of
our stockholders or senior executives and each executive officer. On a going
forward basis, any changes in the compensation arrangements of our executive
officers will be determined by the compensation and organization committee of
our board of directors.

COMMITTEES OF THE BOARD OF DIRECTORS

THE AUDIT COMMITTEE. The audit committee reports to the board of directors
regarding the appointment of our independent public auditors, the scope and
results of our annual audits, compliance with our accounting and financial
policies and management's procedures and policies relative to the adequacy of
our internal accounting controls. The members of the audit committee are
Messrs. Detweiler and Antle, who were appointed in August 2000. The additional
director anticipated to be appointed by our board will also serve on the audit
committee.

THE COMPENSATION AND ORGANIZATION COMMITTEE. The compensation and
organization committee reviews and makes recommendations to the board of
directors regarding our compensation policies and all forms of compensation to
be provided to our executive officers and directors. In addition, the
compensation and organization committee reviews bonus and stock compensation
arrangements for all of our other employees. The members of the compensation and
organization committee are Messrs. McGillivray and Megrue, who were appointed in
February 2000.

THE EXECUTIVE COMMITTEE. The executive committee is authorized to act with
the full power and authority of the board of directors. The purpose of the
executive committee is to allow for decisions to be made on our behalf between
regular meetings of the board of directors. The members of the executive
committee are Messrs. Perera, McGillivray and Megrue, who were appointed in
February 2000.

EMPLOYMENT AGREEMENTS

We have entered into an employment agreement dated October 19, 1999 with
Ismael Perera. Mr. Perera's employment agreement provides that he serves as our
president and chief executive officer for a period that will end on the second
anniversary of the agreement, subject to automatic two-year extension periods
unless either party provides written notice 30 days prior to the end of the
then-current term; provided, however, that his employment will automatically
terminate upon his resignation, death or disability or upon termination by us,
with or without cause. Under his employment agreement, Mr. Perera receives:

- an annual base salary of $275,000 or such higher salary as the board of
directors designates from time to time;

- an annual bonus based upon the achievement of specified goals, to be
determined by the board of directors on an annual basis; and

- customary fringe benefits.

If Mr. Perera's employment is terminated by us without cause, he is entitled
to receive his base salary for a period of the greater of twelve months from the
date of termination or the remaining scheduled term of his employment. If his
employment is terminated by us for cause or if he resigns, dies or becomes
disabled, or if his agreement expires and is not extended, he is entitled to
receive his base salary through the date of termination or expiration.
Mr. Perera is subject to a confidentiality restrictive covenant of unlimited
duration and non-competition and non-solicitation covenants during his
employment term and

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for a certain period of time thereafter. Such period is generally 18 months, and
we may extend the period for up to two additional twelve-month periods, subject
to certain requirements and restrictions.

We also entered into substantially similar employment agreements, dated
May 8, 2000 and May 22, 2000, with Messrs. Harrington and Alfonso, respectively.
Mr. Harrington serves as our chief financial officer and Mr. Alfonso serves as
our controller. Each of the employment agreements provide that the executive
will serve with Linc.net in his current position until the second anniversary of
the agreement, subject to automatic two-year extension periods unless either
party provides written notice 30 days prior to the end of the then-current term;
provided, however, that the executive's employment period will automatically
terminate upon such executive's resignation, death or disability, or upon
termination by us, with or without cause. Under these employment agreements,
Messrs. Harrington and Alfonso will receive:

- an annual base salary of:

<TABLE>
<CAPTION>
NAME ANNUAL BASE SALARY
---- ------------------
<S> <C>
Daniel F. Harrington....................................... $225,000
Emilio Alfonso............................................. 140,000
</TABLE>

- an annual bonus based upon the achievement of specified goals, each to be
determined by the board of directors on an annual basis; and

- certain fringe benefits. For example, Mr. Harrington will be reimbursed by
us for relocation expenses for up to $110,000.

If any of the executives' employment is terminated by us without cause, he
will be entitled to receive his base salary for a period of the greater of
twelve months from the date of termination or the remaining scheduled term of
his employment. If his employment is terminated by us for cause or if he
resigns, dies or becomes disabled, or if his agreement expires and is not
extended, he will be entitled to receive his base salary through the date of
termination or expiration. Generally, each of Messrs. Harrington and Alfonso is
subject to a confidentiality restrictive covenant of unlimited duration and
two-year post-termination non-competition covenants and non-solicitation
covenants.

COMPENSATION OF DIRECTORS

Directors are currently not entitled to receive any compensation for serving
on the board of directors. Directors are reimbursed for their out-of-pocket
expenses incurred in connection with such services. Following this offering,
directors who are not employees of Linc.net or are not otherwise affiliated with
our principal stockholders will each receive a one-time award of 15,000 options
to purchase shares of our common stock, and will receive annual compensation of
$12,000 in cash and options to purchase 7,500 shares of our common stock. These
directors may elect to receive all or a part of their cash compensation in the
form of stock options.

EXECUTIVE STOCK PURCHASE AGREEMENTS

Messrs. Perera, Harrington and Alfonso have each purchased shares of
Linc.net capital stock under a series of Executive Stock Purchase Agreements.
The Executive Stock Purchase Agreements provided for the sale to each executive
of shares of Series A mandatorily redeemable preferred stock and common stock,
which we collectively refer to as the Shares. Some executives paid for all or a
portion of their Shares by delivery of a promissory note in the amounts
described below, secured by a pledge of such shares. Our recourse against each
executive personally is sometimes limited to 50% of the original principal
amount of the note and 100% of the accrued and unpaid interest on the note.
Certain Shares held by Messrs. Perera, Harrington and Alfonso are subject to
vesting schedules. In those cases, the Shares will become fully vested upon a
sale of us or an initial public offering, as long as the executive remains
employed with us until the time of such event.

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The following table describes the purchases under each executive's Executive
Stock Purchase Agreement(s).

<TABLE>
<CAPTION>
SERIES A
MANDATORILY TOTAL PRINCIPAL
REDEEMABLE AMOUNT DUE UNDER
EXECUTIVE COMMON STOCK PREFERRED STOCK PROMISSORY NOTES
--------- ------------ --------------- ----------------
<S> <C> <C> <C>
Ismael Perera.................... 32,500 675 $249,750
Daniel F. Harrington............. 10,500 270 $174,925
Emilio Alfonso................... 4,000 135 $152,475
</TABLE>

In addition, on March 13, 2000, Mr. Perera purchased 30,500 shares of common
stock of Telpro Technologies, Inc. Mr. Perera paid for his Telpro shares by
delivery of a promissory note in the amount of $435,490. For more information,
see "Certain Relationships and Related Transactions."

AMENDED AND RESTATED 1999 STOCK OPTION PLAN

In October 1999, our board of directors approved the 1999 Stock Option Plan,
which we refer to as the 1999 stock option plan and which authorizes the
granting of non-qualified stock options and the sale of our common stock to
employees of Linc.net or its subsidiaries. The Amended and Restated 1999 Stock
Option Plan was adopted by our board of directors on May 23, 2000. The 1999
stock option plan authorizes the granting of stock options up to an aggregate of
40,000 shares of common stock, subject to adjustment based on the occurrence of
specified events and to prevent any dilution or expansion of the rights of
participants that might otherwise result from the occurrence of such events.

Options to purchase an aggregate of shares of our common stock were
outstanding as of September 6, 2000 under the 1999 stock option plan. Such
options generally vest and become exercisable in five equal installments
beginning on the first anniversary of the grant date and continuing thereafter
on an annual basis. Unvested options will terminate in the event that the
optionee ceases to be employed by Linc.net or its subsidiaries and vested but
unexercised options will terminate immediately if the optionee is terminated for
cause, if the optionee ceases to be employed by us or our subsidiaries for any
reason other than cause, after six months in the case of death or disability or
after 90 days in the case of retirement. All of the options granted have an
exercise price equal to the fair market value of the common stock on the grant
date. Subsequent to the adoption of the long-term equity incentive plan
described below, no future grants will be made under the 1999 stock option plan.

LINC.NET, INC. 2000 LONG-TERM EQUITY INCENTIVE PLAN

The Linc.net 2000 Long-Term Equity Incentive Plan, which we refer to as the
long-term equity incentive plan was adopted by our board of directors and
stockholders in August 2000 and will become effective at the time of this
offering. The long-term equity incentive plan provides for grants of incentive
and nonqualified stock options, stock appreciation rights, restricted stock and
performance awards. Certain directors, officers and other employees of Linc.net
and its subsidiaries and persons who engage in services for us are eligible for
grants under the plan. The purpose of the long-term equity incentive plan is to
provide these individuals with incentives to maximize stockholder value and
otherwise contribute to our success and to enable us to attract, retain and
reward the best available persons for positions of responsibility.

A total of shares of our common stock will be available for issuance
under the long-term equity incentive plan, subject to adjustment in the event of
a reorganization, stock split, merger or similar change in the corporate
structure of Linc.net. The compensation and organization committee has the
authority to declare options or other awards fully vested and exercisable upon a
change in control of Linc.net. Additionally, in the event of a change in
control, the compensation and organization committee

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may cancel outstanding options for consideration and cancel options that are not
exercisable or provide substitute options or securities in the successor company
following such change in control.

The compensation and organization committee of our board of directors will
administer the long-term equity incentive plan. Our board also has the authority
to administer the plan and to take all actions that the compensation and
organization committee is otherwise authorized to take under the plan. The
compensation and organization committee has granted options to purchase
shares of our common stock under the equity incentive plan. We anticipate that
in connection with the offering, we will grant options to purchase an aggregate
of approximately additional shares of our common stock to approximately
employees. All of these options will have an exercise price equal to the initial
public offering price of the common stock in this offering and will be subject
to vesting over a five-year period.

Directors, officers and employees of Linc.net and its subsidiaries, as well
as other individuals performing significant services for us, or to whom we have
extended an offer of employment, will be eligible to receive grants under the
long-term equity incentive plan. However, only employees may receive grants of
incentive stock options. In each case, the compensation and organization
committee will select the actual grantees.

Under the long-term equity incentive plan, the compensation and organization
committee or the board may award grants of incentive stock options conforming to
the provisions of Section 422 of the Internal Revenue Code of 1986, as amended,
non-qualified stock options, stock appreciation rights, restricted stock grants
and other performance awards. The compensation and organization committee may
not, however, award to any one person in any calendar year options to purchase
common stock equal to more than % of the total number of shares authorized
under the plan, and it may not award incentive options first exercisable in any
calendar year whose underlying shares have a fair market value greater than
$100,000, determined at the time of grant.

The compensation and organization committee will determine the exercise
price of any option in its discretion. However, the exercise price of an
incentive option may not be less than 100% of the fair market value of a share
of common stock on the date of grant, and the exercise price of an incentive
option awarded to a person who owns stock constituting more than 10% of our
voting power may not be less than 110% of such fair market value on such date.

Unless the compensation and organization committee determines otherwise, the
exercise price of any option may be paid only in cash.

The compensation and organization committee will determine the term of each
option in its discretion. However, no term may exceed ten years from the date of
grant or, in the case of an incentive option granted to a person who owns stock
constituting more than 10% of our voting power, five years from the date of
grant. In addition, all options under the long-term equity incentive plan,
whether or not then exercisable, generally cease vesting when a grantee ceases
to be a director, officer or employee of, or otherwise ceases to perform
services for, Linc.net or its subsidiaries. Options generally expire 30 days
after the date of cessation of service, but not later than the expiration date
of such options, so long as the grantee does not compete with us during the
30-day period. In the case of a grantee's death or disability, all options will
vest immediately and remain exercisable for up to 180 days after the date of
death or disability but not later than the expiration date of such options. In
the event of retirement, a grantee's vested options will remain exercisable for
up to 90 days after the date of retirement, but not later than the expiration
date of such options, so long as the grantee does not compete with us during
such period, while his or her unvested options may become fully vested and
exercisable in the discretion of the compensation and organization committee.
Upon termination for cause, all options will terminate immediately whether or
not then exercisable.

The compensation and organization committee may also grant stock
appreciation rights, restricted stock awards and other performance awards. Upon
exercise of a stock appreciation right, the grantee will

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receive an amount in cash and/or shares of common stock or other of our
securities equal to the difference between the fair market value of a share of
common stock on the date of exercise and the exercise price of the right.
Restricted stock awards will consist of shares of stock granted to the recipient
subject to vesting restrictions imposed in connection with the award. A grantee
will be required to pay us at least the aggregate par value of any shares of
restricted stock within ten days of the date of grant, unless the shares are
treasury shares. The compensation and organization committee may grant
performance awards contingent upon achievement by the grantee or the company of
set goals and objectives regarding specified performance criteria, such as
return on equity, over a specified performance cycle, as designated by the
compensation committee. A performance award may be paid out in cash and/or
shares of common stock or other of our securities.

The board may amend or terminate the long-term equity incentive plan in its
discretion, except that no amendment will become effective without prior
approval of our stockholders if such approval is necessary for continued
compliance with the performance-based compensation exception of Section 162(m)
of the tax code or any stock exchange listing requirements. Furthermore, any
termination may not materially and adversely affect any outstanding rights or
obligations under the long-term equity incentive plan without the affected
participant's consent. If not previously terminated by the board, the long-term
equity incentive plan will terminate on the tenth anniversary of its adoption.

ONE MILLION DOLLAR COMPENSATION LIMIT

The Revenue Reconciliation Act of 1993 limits the annual deduction a
publicly held company may take for compensation paid to its chief executive
officer or any of its four other highest compensated officers in excess of
$1,000,000 per year, excluding for this purpose compensation that is
"performance-based" within the meaning of Section 162(m) of the tax code. We
intend that compensation realized upon the exercise of an option or other award
granted under the long-term equity incentive plan be regarded as
"performance-based" under Section 162(m) and that such compensation be
deductible without regard to the limits imposed by Section 162(m) on
compensation that is not "performance-based."

Compensation paid under the long-term equity incentive plan will not qualify
as performance-based except to the extent paid pursuant to grants made under the
plan following the approval of the plan by our stockholders in accordance with
Section 162(m)(4)(c) of the tax code and the related Treasury Regulations, and
except to the extent that other requirements are satisfied. However, based on a
special rule contained in regulations issued under Section 162(m), the
$1 million deduction limitation described above should not apply to any options
or other awards under the long-term equity incentive plan prior to our annual
meeting of shareholders in the calendar year following the close of the third
calendar year after our initial public offering.

EMPLOYEE STOCK PURCHASE PLAN

The 2000 Employee Stock Purchase Plan, which we refer to as the employee
stock purchase plan, was adopted by our board of directors and stockholders in
August 2000 and will become effective at the time of this offering. The employee
stock purchase plan was established to give employees desiring to do so a
convenient means of purchasing shares of our common stock through payroll
deductions. The employee stock purchase plan provides an incentive to
participants by permitting purchases at a discounted price. We believe that
ownership of stock by employees will foster greater employee interest in the
success, growth and development of Linc.net.

Subject to restrictions, each of our employees will be eligible to
participate in the employee stock purchase plan if he or she has been employed
by us for more than six months. Participation is discretionary with each
eligible employee. We have reserved shares of common stock for issuance in
connection with the employee stock purchase plan. Each eligible employee is
entitled to purchase a maximum of $25,000 worth of our common stock per year.
Elections to participate and purchases of stock will be made

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on a quarterly basis. Each participating employee contributes to the employee
stock purchase plan by choosing a payroll deduction in an amount not exceeding
15% of the compensation such employee receives on each paydate during the
offering period. A participating employee may increase or decrease the amount of
such employee's payroll deduction (but not above 15%) including a change to a
zero deduction as of the beginning of any calendar quarter. Elected
contributions will be credited to participants' accounts at the end of each
calendar quarter. In addition, employees may make lump sum contributions at the
end of the year to enable them to purchase the maximum number of shares
available for purchase during the plan year.

Set forth below is a summary of how the employee stock purchase plan will
operate:

- Each participating employee's contributions will be used to purchase
shares for the employee's share account within 15 days after the last day
of each calendar quarter.

- The cost per share is 85% of the lower of the closing price of our common
stock on the New York Stock Exchange on the first or the last day of the
calendar quarter.

- The number of shares purchased on each employee's behalf and deposited in
his/her share account is based on the amount accumulated in such
participant's cash account and the purchase price for shares with respect
to any calendar quarter.

- Shares purchased under the stock purchase plan carry full rights to
receive dividends, if declared.

- Any dividends attributable to shares in the employee's share account are
automatically used to purchase additional shares for such employee's share
account.

- Share distributions and share splits will be credited to the participating
employee's share account as of the record date and effective date.

- A participating employee has full ownership of all shares in his/her share
account and may withdraw them for sale or otherwise by written request to
the compensation and organization committee of the board of directors
following the close of each calendar quarter.

Subject to applicable federal securities and tax laws, the board of
directors has the right to amend or to terminate the employee stock purchase
plan. Amendments to the employee stock purchase plan will not affect a
participating employee's right to the benefit of the contributions made by such
employee prior to the date of any such amendment. In the event the employee
stock purchase plan is terminated, the compensation committee is required to
distribute all shares held in each participating employee's share account plus
an amount of cash equal to the balance in each participating employee's cash
account.

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PRINCIPAL STOCKHOLDERS

The following table sets forth certain information regarding our beneficial
ownership as of September 6, 2000, on an actual basis, and as adjusted to
reflect completion of the offering and the reclassification, by:

- each person or entity known to us to beneficially own more than 5% of any
class of outstanding voting securities,

- each of our named executive officers,

- each of our directors and

- all of our directors and executive officers as a group.

To our knowledge each of such stockholders has sole voting and investment
power as to the shares shown unless otherwise noted. You should keep the
following points in mind as you read the information in the table.

- The amounts and percentage of our capital stock beneficially owned by a
holder are reported on the basis of the regulations of the SEC that govern
the determination of beneficial ownership of securities. Under these
regulations, a person or group of persons is deemed to be a "beneficial
owner" of a security if that person or group has or shares "voting power,"
which includes the power to dispose of or to direct the disposition of the
security. A person or group of persons is also deemed to be a beneficial
owner of any securities with respect to which that person or group has a
right to acquire beneficial ownership within 60 days of September 6, 2000.
Under these rules, more than one person may be deemed a beneficial owner
of the same security and a person may be deemed to be a beneficial owner
of securities as to which that person has no economic interest.

- The percentage of each class of our capital stock outstanding is based on
the number of shares of each class of our capital stock outstanding as of
September 6, 2000, including any such shares deemed outstanding pursuant
to the definition of beneficial ownership in the preceding paragraph.
Shares deemed outstanding pursuant to the definition of beneficial
ownership are deemed to be outstanding when computing the percentage of
ownership of each person or group of persons named above, but are not
deemed to be outstanding for the purpose of computing the percentage
ownership of any other person or group.

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<TABLE>
<CAPTION>
PRIOR TO THE OFFERING AFTER THE OFFERING
---------------------------------------------------------------------------- ----------------------
SERIES A
MANDATORILY SERIES B
REDEEMABLE REDEEMABLE
PREFERRED STOCK PREFERRED STOCK COMMON STOCK COMMON STOCK
----------------------- ----------------------- ------------------------ ----------------------
NUMBER OF PERCENTAGE NUMBER OF PERCENTAGE NUMBER OF PERCENTAGE NUMBER PERCENTAGE
NAME AND ADDRESS SHARES OF CLASS SHARES OF CLASS SHARES OF CLASS OF SHARES OF CLASS
---------------- ---------- ---------- ---------- ---------- ----------- ---------- --------- ----------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
PRINCIPAL STOCKHOLDERS:
Banc One Equity
Capital(1).............. 39,168.0 36.8% -- -- 435,200.4 33.2%
SKM(2).................... 39,168.0 36.8% -- -- 435,200.4 33.2%
DIRECTORS AND EXECUTIVE
OFFICERS:
Ismael Perera(3).......... 675.0 * -- -- 32,500.0 2.5%
Daniel F. Harrington(4)... 270.0 * -- -- 10,500.0 *
Emilio Alfonso(5)......... 135.0 * -- -- 4,000.0 *
Burton E.
McGillivray(6).......... 39,168.0 36.8% -- -- 435,200.4 33.2%
William S. Antle(7)....... 450.0 * -- -- 6,000.0 *
Timothy B. Armstrong(8)... 39,168.0 36.8% -- -- 435,200.4 33.2%
Deborah Clark(9).......... 1,530.0 1.4% -- -- 17,000.0 1.3%
Richard W.
Detweiler(10)........... -- -- -- -- -- --
John F. Megrue, Jr.(11)... 39,168.0 36.8% -- -- 435,200.4 33.2%
Paul L. Whiting,
Jr.(12)................. 39,168.0 36.8% -- -- 435,200.4 33.2%
All directors and
executive officers as a
group (10
persons)(13)............ 91,808.9 86.2% 1,714.2 29.8% 1,076,396.7 82.0%
</TABLE>

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

* Less than one percent.

(1) Represents shares held by Linc.net, LLC, an affiliate of Banc One Equity
Capital, which may be attributed to Banc One Equity Capital and certain of
its co-investors, including Cross Creek IX, Cross Creek X and Cross Creek
X-A. In addition, Carlisle Linc.net Investors, L.P. ("Carlisle Linc.net") is
a member of Linc.net, LLC, but does not possess the power to vote or dispose
of or to direct the voting or disposition of Linc.net common or preferred
stock. The address of Banc One Equity Capital is 55 W. Monroe Street, 16th
Floor, Chicago, Illinois 60670-0610.

(2) Represents shares held by SKM Linc.net, LLC, an affiliate of SKM, which may
be attributed to SKM and certain of its affiliates, including SKM Equity II,
SKM Investment II, SKM Equity III and SKM Investment. In addition, Carlisle
Linc.net is a member of SKM Linc.net, LLC, but does not possess the power to
vote or dispose of or to direct the voting or disposition of Linc.net common
or preferred stock. The address of the SKM Entities is c/o Saunders Karp &
Megrue, L.P., 262 Harbor Drive, 4th Floor, Stamford, CT 06902.

(3) The 32,500 shares of common stock in the table include 25,000 shares of
common stock which are subject to vesting. The address for Mr. Perera is c/o
Linc.net, Inc., 6161 Blue Lagoon Drive, Suite 300, Miami, Florida 33126.

(4) The 10,500 shares of common stock in the table include 7,500 shares of
common stock which are subject to vesting. The address for Mr. Harrington is
c/o Linc.net, Inc., 6161 Blue Lagoon Drive, Suite 300, Miami, Florida 33126.

(5) The 4,000 shares of common stock in the table include 2,500 shares of common
stock which are subject to vesting. The address for Mr. Alfonso is c/o
Linc.net, Inc., 6161 Blue Lagoon Drive, Suite 300, Miami, Florida 33126.

(6) Mr. McGillivray is a Managing Director of Banc One Equity Capital and a
member of Cross Creek IX, Cross Creek X and Cross Creek X-A. As a result,
the shares of common stock and preferred stock held by Linc.net LLC may be
deemed to be beneficially owned by Mr. McGillivray, who disclaims beneficial
ownership of any such shares in which he does not have a pecuniary interest.
Mr. McGillivray does not directly own any shares of our capital stock. The
address of Mr. McGillivray is c/o Banc One Equity Capital, 55 W. Monroe
Street, 16th Floor, Chicago, Illinois 60670-0610.

(7) The 6,000 shares of common stock in the table include 1,000 shares of common
stock which are subject to vesting. The address for Mr. Antle is c/o
Linc.net, Inc., 6161 Blue Lagoon Drive, Suite 300, Miami, Florida 33126.

(8) Mr. Armstrong is a Principal of SKM and a member of: Saunders Karp & Megrue
Partners, L.L.C., the general partner of SKM Partners, L.P., the general
partner of SKM Equity II and SKM Investment II; and SKM Partners, L.L.C.,
the general partner of SKM Equity III and SKM Investment. As a result, the
shares of common stock and preferred stock owned by SKM Linc.net, LLC may be
deemed to be beneficially owned by Mr. Armstrong, who disclaims beneficial
ownership of any such shares in which he does not have a pecuniary interest.
Mr. Armstrong does not directly own any shares of our capital stock. The
address of Mr. Armstrong is c/o Saunders Karp & Megrue, L.P., 262 Harbor
Drive, 4th Floor, Stamford, Connecticut 06902.

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(9) The address for Ms. Clark is c/o Linc.net, Inc., Southwest Region
Installation Group, P.O. Box 310, Mineral Wells, Texas 76068.

(10) Mr. Detweiler is a Managing Director of Carlisle Enterprises, LLC
("Carlisle"), the general partner of Carlisle Linc.net. Carlisle Linc.net is
a member of each of Linc.net, LLC and SKM Linc.net, LLC, but does not
possess the power to vote or dispose of or to direct the voting or
disposition of Linc.net common or preferred stock. Mr. Detweiler disclaims
beneficial ownership of any shares of common stock or preferred stock in
which he does not have a pecuniary interest. Mr. Detweiler does not directly
own any shares of our capital stock. The address of Mr. Detweiler is c/o
Carlisle Enterprises, LLC, 7777 Fay Avenue, Suite 200, La Jolla, California
92037.

(11) Mr. Megrue is a Partner of SKM and a member of: Saunders Karp & Megrue
Partners, L.L.C., the general partner of SKM Partners, L.P., the general
partner of SKM Equity II and SKM Investment II; and SKM Partners, L.L.C.,
the general partner of SKM Equity III and SKM Investment. As a result, the
shares of common stock and preferred stock owned by SKM Linc.net, LLC may be
deemed to be beneficially owned by Mr. Megrue, who disclaims beneficial
ownership of any such shares in which he does not have a pecuniary interest.
Mr. Megrue does not directly own any shares of our capital stock. The
address of Mr. Megrue is c/o Saunders Karp & Megrue, L.P., 262 Harbor Drive,
4th Floor, Stamford, Connecticut 06902.

(12) Mr. Whiting is a Principal of Banc One Equity Capital and a member of Cross
Creek IX, Cross Creek X and Cross Creek X-A. As a result, the shares of
common stock and preferred stock held by Linc.net, LLC may be deemed to be
beneficially owned by Mr. Whiting, who disclaims beneficial ownership of any
such shares in which he does not have a pecuniary interest. Mr. Whiting does
not directly own any shares of our capital stock. The address of
Mr. Whiting is c/o Banc One Equity Capital, 55 W. Monroe Street, 16th Floor,
Chicago, Illinois 60670-0610.

(13) The shares of Series B redeemable preferred stock included in the table are
owned by Larry Jordan our President--Central Office Installation Group. We
issued an aggregate of 5,760 shares of Series B redeemable preferred stock
in connection with our acquisitions of Telpro and Communicor.

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CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

STOCK PURCHASE AGREEMENTS

From time to time, affiliates of Banc One Equity Capital and SKM have
entered into stock purchase agreements with us for the purchase of shares of our
Series A mandatorily redeemable preferred stock and common stock in order to
provide equity financing to us in connection with our acquisitions. These
agreements provide Banc One Equity Capital and SKM with customary rights as
investors, many of which terminate at the time of this offering, including
information and inspection rights. As of September 6, 2000, without giving
effect to the Intercon acquisition, affiliates of Banc One Equity Capital and
SKM have purchased, through these stock purchase agreements, shares of our
Series A mandatorily redeemable preferred stock and common stock for an
aggregate purchase price of approximately $87.0 million. In addition, in
connection with the Intercon acquisition, we anticipate that affiliates of Banc
One Equity Capital and SKM will purchase shares of Series A mandatorily
redeemable preferred stock and common stock. See "Unaudited Pro Forma Condensed
Consolidated Financial Statements."

STOCKHOLDERS AGREEMENT

Linc.net, LLC, an affiliate of Banc One Equity Capital, and SKM Linc.net,
LLC, an affiliate of SKM, have entered into a stockholders agreement pursuant to
which they will coordinate their vote with respect to the election of our
directors. In addition, the stockholders agreement generally provides each party
with co-sale rights in the event the other party elects to transfer its shares,
except for transfers to affiliates or in a public sale.

MANAGEMENT SERVICES ARRANGEMENTS

We were parties to Management Services Agreements with each of Banc One
Equity Capital, SKM and Carlisle under which those entities provided us with
advice and consultation on general business and financial matters for a fee. We
paid $250,000 and $500,000 in 1999 and 2000, respectively, under these
arrangements. On September 1, 2000, we terminated these agreements in exchange
for shares of our common stock and shares of Series A mandatorily
redeemable preferred stock.

In addition, Banc One Equity Capital, SKM and Carlisle will have received,
assuming the completion of the Intercon acquisition, an aggregate of
approximately $5.1 million in transaction fees in connection with the completion
of each of our acquisitions.

THE TELPRO ACQUISITION AND RELATED TRANSACTIONS

On March 13, 2000, we acquired 49% of the outstanding voting stock of Telpro
Technologies, Inc., or Telpro Technologies. We also acquired an option to
purchase the remainder of the outstanding voting stock of Telpro Technologies.
In connection with this acquisition, Mr. Perera purchased 2% of the outstanding
voting stock of Telpro Technologies for an aggregate purchase price of $435,490.
Mr. Perera paid for his Telpro Technologies shares by delivery of a promissory
note. In addition, Larry Jordan, the founder of Telpro Technologies and its
largest stockholder, retained 49% of its outstanding voting stock.

We currently intend to exercise our option to purchase Mr. Jordan's voting
stock for an aggregate purchase price to be determined in accordance with the
terms of the option. In addition, we intend to repurchase Mr. Perera's Telpro
Technologies stock. In connection with the foregoing, Telpro Technologies
divested a product line of its business into a newly formed subsidiary, Telpro
Products, Inc., of which Telpro Technologies owns a 49% interest. In addition,
Messrs. Perera and Jordan collectively purchased 51% of the outstanding voting
common stock of Telpro Products, Inc. The Telpro Products shares owned by
Messrs. Perera and Jordan are subject to repurchase by Telpro Products at the
lower of then-current fair market value or cost if such executive's employment
with us is terminated with cause, or such executive resigns prior to the tenth
anniversary of the purchase. In the event of death, disability or such
executive's

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employment is terminated without cause, Telpro Products has the right to
repurchase such shares at their then-current fair market value. Messrs. Perera
and Jordan paid for their Telpro Products shares by delivery of a promissory
note in an amount based on the value of Telpro Products' net assets at the time
of closing, secured by a pledge of such Telpro Products shares. Our recourse
against Messrs. Perera and Jordan personally is limited in each case to 50% of
the original principal amount of the note plus 100% of any accrued and unpaid
interest.

OTHER AGREEMENTS

We have entered into an agreement with Gateway Partners, Inc., a stockholder
of our company, under which Gateway will assist us in the identification,
analysis and negotiation of proposed acquisitions in exchange for fees
determined as a percentage of the acquisition cost. The agreement with Gateway
is non-exclusive and can be terminated with 30 days written notice. As of
September 6, 2000, we have paid approximately $5.1 million in fees under this
agreement, assuming the completion of the Intercon acquisition.

INTERESTS OF CERTAIN EXPERTS

Randolph Street Partners and Randolph Street Partners 1998 DIF, LLC, which
we collectively refer to as Randolph Street Partners, have purchased
shares of common stock on the same terms and conditions as other Linc.net
investors. In connection with that purchase, Randolph Street Partners entered
into the registration agreement described under "Shares Eligible for Future
Sale." Some partners of Kirkland & Ellis are partners in Randolph Street
Partners. Kirkland & Ellis has provided legal services to Banc One Equity
Capital and Linc.net from time to time and expects to continue to do so for the
foreseeable future.

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<PAGE>
DESCRIPTION OF CERTAIN INDEBTEDNESS

SENIOR CREDIT FACILITY

On June 16, 2000, we entered into an amended and restated senior credit
facility with PNC Bank, National Association, as Agent, General Electric Capital
Corporation, as Syndication Agent, PNC Capital Markets, Inc., as Lead Arranger,
and various other lenders that provides for:

- a revolving credit facility of up to $30.0 million in revolving credit
loans and letters of credit,

- a Term Loan A facility of $100.0 million in term loans and

- a Term Loan B facility of $100.0 million in term loans.

We may borrow amounts under the senior credit facility to provide a portion of
the proceeds required for our current operating companies and other permitted
acquisitions, to pay related fees and expenses and to fund working capital and
general corporate needs. All revolving loans incurred under the senior credit
facility will mature on June 16, 2005. At September 6, 2000, there was
approximately $213.3 million outstanding and approximately $16.7 million of
unused borrowing capacity under the senior credit facility. The following is a
summary of the material terms of the senior credit facility:

The senior credit facility is secured by:

- a first priority security interest in all of our receivables, contracts,
contract rights, equipment, intellectual property, inventory and all other
tangible and intangible assets and each of our domestic subsidiaries,
subject to certain customary exceptions and

- a pledge of all capital stock of any direct and indirect domestic
subsidiaries.

Our borrowings under the senior credit facility bear interest at a floating
rate and may be maintained by us as base rate loans or, at our option, as
Euro-rate loans. Base rate loans bear interest at the base rate plus an
applicable margin for the revolving credit facility and the Term Loan A facility
and 250 basis points for the Term Loan B facility. Base rate is defined in the
senior credit facility as the higher of (x) the interest rate per annum
announced from time to time by PNC Bank and (y) the federal funds effective
rate, plus one half percent ( 1/2%) per annum. Euro-rate loans bear interest at
the Euro-rate as described in the amended senior credit facility, plus an
applicable margin for the revolving credit facility and the Term Loan A
facility, and 400 basis points for the Term Loan B facility.

Under the senior credit facility we must also pay commitment fees, which are
calculated at a rate per annum based on certain financial covenants in the case
of the revolving credit loans, and based on a percentage of the difference
between committed amounts and amounts actually borrowed in the case of the Term
Loan A facility.

Prior to the maturity date, funds borrowed under the revolving credit
facility may be borrowed, repaid and reborrowed, without premium or penalty. The
term loans mature, and as a result must be repaid, in quarterly installments on
March 31, June 30, September 30 and December 31 of each year, beginning on
June 30, 2000. Term Loan A will mature in quarterly installments from
March 2001 through 2005. Term Loan B will mature in quarterly installments from
June 2000 through March 2007.

Voluntary prepayments of amounts outstanding under the amended senior credit
facility are permitted at any time, so long as we give notice as required by the
facility. However, if a prepayment is made with respect to a Euro-rate loan and
the prepayment is made on a date other than an interest payment date, we must
pay a fee to compensate the lender for losses and expenses incurred as a result
of the prepayment. Covenants in the senior credit facility require us to use 50%
of the proceeds we receive in specified debt or equity issuances to repay
outstanding principal.

The senior credit facility requires us to meet certain financial tests,
including without limitation, minimum fixed charge coverage ratios, a maximum
leverage ratio and a minimum interest coverage ratio.

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In addition, the senior credit facility contains certain covenants which, among
other things, limit the incurrence of additional indebtedness, investments,
dividends, transactions with affiliates, asset sales, acquisitions, mergers and
consolidations, prepayments of other indebtedness, liens and encumbrances and
other matters customarily restricted in such agreements.

The senior credit facility contains customary events of default, including
without limitation, payment defaults, breaches of representations and
warranties, covenant defaults, cross-defaults to certain other indebtedness in
excess of $1.0 million, specified events of bankruptcy and insolvency, judgment
defaults in excess of $1.0 million, failure of any guaranty or security document
supporting the senior credit facility to be in full force and effect and a
change of control of Linc.net.

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DESCRIPTION OF CAPITAL STOCK

GENERAL MATTERS

Upon completion of this offering and the amendment to our certificate of
incorporation, the total amount of our authorized capital stock will consist of
shares of common stock and shares of preferred stock.

After giving effect to this offering, we will have shares of common stock,
or shares if the underwriters' over-allotment option is exercised in full, and
no shares of preferred stock outstanding. As of September 6, 2000, we had
stockholders of record with respect to our common stock and stockholders
of record with respect to our preferred stock.

The certificate of incorporation and by-laws contain provisions that are
intended to enhance the likelihood of continuity and stability in the
composition of the board of directors and which may have the effect of delaying,
deferring or preventing a future takeover or change in control of Linc.net
unless such takeover or change in control is approved by the board of directors.

THE RECLASSIFICATION

We currently have three classes of capital stock, designated as Series A
mandatorily redeemable preferred stock, Series B redeemable preferred stock and
common stock. The Series A mandatorily redeemable preferred stock and Series B
redeemable preferred stock are generally identical, except in connection with
certain scheduled and mandatory redemptions as described in our certificate of
incorporation. Immediately prior to the completion of this offering, we will
amend our certificate of incorporation in order to reclassify all of the
outstanding shares of Series A mandatorily redeemable preferred stock and
Series B redeemable preferred stock into a single class of common stock. The
number of shares to be issued in this reclassification will be determined by
dividing the liquidation value of each such share plus accrued and unpaid
dividends thereon by the value of a share of our common stock based on the
initial public offering price. We refer to this process as the
"reclassification."

Assuming an initial public offering price of $ per share, the mid-point
of the range set forth on the cover page of this prospectus, and a closing date
of , 2000 for this offering, an aggregate of shares of common
stock will be issued in exchange for the outstanding shares of Series A
mandatorily redeemable preferred stock and Series B redeemable preferred stock
in connection with the reclassification. The actual number of shares of common
stock that will be issued as a result of the reclassification is subject to
change based on the actual offering price and the closing date of this offering.
Fractional shares otherwise issuable as a result of the reclassification will be
rounded to the nearest whole number. Unless otherwise stated, the information
contained in this prospectus assumes the reclassification of all of our
outstanding Series A mandatorily redeemable preferred stock and Series B
redeemable preferred stock into common stock that will occur immediately prior
to the effectiveness of the registration statement of which this prospectus is a
part.

COMMON STOCK

The issued and outstanding shares of common stock are, and the shares of
common stock to be issued by us in connection with the offering will be, validly
issued, fully paid and nonassessable. Subject to the prior rights of the holders
of any preferred stock, the holders of outstanding shares of common stock are
entitled to receive dividends out of assets legally available for such purpose
at such time and in such amounts as the board of directors may from time to time
determine. See "Dividend Policy." The shares of common stock are not convertible
and the holders thereof have no preemptive or subscription rights to purchase
any of our securities. Upon liquidation, dissolution or winding up of Linc.net,
the holders of common stock are entitled to receive pro rata our assets which
are legally available for distribution, after payment of all debts and other
liabilities and subject to the prior rights of any holders of preferred stock
then outstanding. Each outstanding share of common stock is entitled to one vote
on all matters submitted to a vote of stockholders. There is no cumulative
voting. Except as otherwise required by law or our

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certificate of incorporation, the holders of the common stock and the holders of
the preferred stock, if any, vote together as a single class on all matters
submitted to a vote of stockholders.

We intend to file an application for our common stock to be listed on the
New York Stock Exchange under the symbol "LN."

SERIAL PREFERRED STOCK

Our board of directors may, without further action by our stockholders, from
time to time, direct the issuance of shares of preferred stock in a series and
may, at the time of issuance, determine the rights, preferences and limitations
of each series. Satisfaction of any dividend preferences of outstanding shares
of preferred stock would reduce the amount of funds available for the payment of
dividends on shares of common stock. Holders of shares of preferred stock may be
entitled to receive a preference payment in the event of any liquidation,
dissolution or winding-up of Linc.net before any payment is made to the holders
of shares of common stock. Under specified circumstances, the issuance of shares
of preferred stock may render more difficult or tend to discourage a merger,
tender offer or proxy contest, the assumption of control by a holder of a large
block of our securities or the removal of incumbent management. Upon the
affirmative vote of a majority of the total number of directors then in office,
the board of directors, without stockholder approval, may issue shares of
preferred stock with voting and conversion rights which could adversely affect
the holders of shares of common stock. There are no shares of preferred stock
outstanding, and we have no present intention to issue any shares of preferred
stock.

MATERIAL PROVISIONS OF THE RESTATED CERTIFICATE OF INCORPORATION AND BY-LAWS

The certificate of incorporation provides that stockholder action can be
taken only at an annual or special meeting of stockholders and cannot be taken
by written consent in lieu of a meeting. The certificate of incorporation and
the by-laws provide that, except as otherwise required by law, special meetings
of the stockholders can only be called pursuant to a resolution adopted by a
majority of the board of directors or by our chief executive officer.
Stockholders will not be permitted to call a special meeting or to require our
board of directors to call a special meeting.

Our restated certificate of incorporation also provides for our board of
directors to be divided into three classes, as nearly equal in number as
possible, serving staggered terms. Approximately one-third of our board of
directors will be elected each year. For more information, see "Management."
Under the Delaware General Corporation Law and unless the certificate of
incorporation provides otherwise, directors serving on a classified board can
only be removed for cause. The provision for a classified board could prevent a
party who acquires control of a majority of the outstanding voting stock from
obtaining control of the board until the second annual stockholders meeting
following the date the acquiror obtains the controlling stock interest. The
classified board provision could have the effect of discouraging a potential
acquiror from making a tender offer or otherwise attempting to obtain control of
Linc.net and could increase the likelihood that incumbent directors will retain
their positions.

The by-laws establish an advance notice procedure for stockholder proposals
to be brought before an annual meeting of our stockholders, including proposed
nominations of persons for election to the board. Stockholders at an annual
meeting may only consider proposals or nominations specified in the notice of
meeting or brought before the meeting by or at the direction of the board of
directors or by a stockholder who was a stockholder of record on the record date
for the meeting, who is entitled to vote at the meeting and who has given to our
secretary timely written notice, in proper form, of such stockholder's intention
to bring that business before the meeting. Although the by-laws do not give the
board the power to approve or disapprove stockholder nominations of candidates
or proposals regarding other business to be conducted at a special or annual
meeting, the by-laws may have the effect of precluding the conduct of certain
business at a meeting if the proper procedures are not followed or may
discourage or defer a potential acquiror from conducting a solicitation of
proxies to elect its own slate of directors or otherwise attempting to obtain
control of Linc.net.

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The certificate of incorporation and by-laws provide that the affirmative
vote of holders of at least 66 2/3% of the total votes eligible to be cast in
the election of directors is required to amend, alter, change or repeal certain
of their provisions. This requirement of a super-majority vote to approve
amendments to the certificate of incorporation and by-laws could enable a
minority of our stockholders to exercise veto power over any such amendments.

MATERIAL PROVISIONS OF DELAWARE LAW

Following the consummation of this offering, we will be subject to the
"Business Combination" provisions of the Delaware General Corporation Law. In
general, such provisions prohibit a publicly held Delaware corporation from
engaging in various "business combination" transactions with any "interested
stockholder" for a period of three years after the date of the transaction in
which the person became an "interested stockholder," unless:

- the transaction is approved by the board of directors prior to the date
the "interested stockholder" obtained such status,

- upon consummation of the transaction which resulted in the stockholder
becoming an "interested stockholder," the "interested stockholder," owned
at least 85% of the voting stock of the corporation outstanding at the
time the transaction commenced, excluding for purposes of determining the
number of shares outstanding those shares owned by (a) persons who are
directors and also officers and (b) employee stock plans in which employee
participants do not have the right to determine confidentially whether
shares held subject to the plan will be tendered in a tender or exchange
offer, or

- on or subsequent to such date the "business combination" is approved by
the board of directors and authorized at an annual or special meeting of
stockholders by the affirmative vote of at least 66 2/3% of the
outstanding voting stock which is not owned by the "interested
stockholder."

A "business combination" is defined to include mergers, asset sales and
other transactions resulting in financial benefit to a stockholder. In general,
an "interested stockholder" is a person who, together with affiliates and
associates, owns (or within three years, did own) 15% or more of a corporation's
voting stock. The statute could prohibit or delay mergers or other takeover or
change in control attempts with respect to Linc.net and, accordingly, may
discourage attempts to acquire Linc.net.

OTHER PROVISIONS THAT COULD DETER OR PREVENT A CHANGE OF CONTROL

In addition, a change of control of Linc.net would cause an event of default
under our senior credit facility. For more information, see "Description of
Certain Indebtedness." Further, our compensation and organization committee has
the authority to declare options fully vested and exercisable upon a change of
control of Linc.net. See "Management--Linc.net 2000 Long-Term Equity Incentive
Plan."

LIMITATIONS ON LIABILITY AND INDEMNIFICATION OF OFFICERS AND DIRECTORS

The certificate of incorporation limits the liability of directors to the
fullest extent permitted by the Delaware General Corporation Law. In addition,
the certificate of incorporation provides that we will indemnify our directors
and officers to the fullest extent permitted by such law. We expect to enter
into indemnification agreements with our current directors and executive
officers prior to the completion of the offering and expect to enter into a
similar agreement with any new directors or executive officers.

TRANSFER AGENT AND REGISTRAR

The Transfer Agent and Registrar for our common stock is First Union
Securities, Inc.

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SHARES ELIGIBLE FOR FUTURE SALE

Prior to this offering, there was no market for our common stock. We can
make no predictions as to the effect, if any, that sales of shares or the
availability of shares for sale will have on the market price for our common
stock prevailing from time to time. Nevertheless, sales of significant amounts
of our common stock in the public market, or the perception that such sales may
occur, could adversely affect prevailing market prices.

SALE OF RESTRICTED SHARES

Upon completion of this offering, we will have shares of common stock
outstanding. In addition, shares of common stock are issuable upon the
exercise of outstanding stock options. Of the shares outstanding after the
offering, shares of common stock, or shares if the underwriters'
over-allotment is exercised in full, are freely tradeable without restriction
under the Securities Act, except for any such shares which may be held or
acquired by an "affiliate" of Linc.net, as that term is defined in Rule 144
promulgated under the Securities Act, which shares will be subject to the volume
limitations and other restrictions of Rule 144 described below.

An aggregate of shares of common stock held by our existing
stockholders upon completion of the offering will be "restricted securities," as
that phrase is defined in Rule 144, and may not be resold in the absence of
registration under the Securities Act or pursuant to an exemption from such
registration, including among others, the exemptions provided by Rule 144 under
the Securities Act.

In general, under Rule 144 as currently in effect, beginning 90 days after
the date of this prospectus, if a period of at least one year has elapsed since
the later of the date the "restricted securities" were acquired from us or the
date they were acquired from an affiliate, then the holder of such restricted
securities, including an affiliate, is entitled to sell in the public market a
number of shares within any three-month period that does not exceed the greater
of 1% of the then outstanding shares of the common stock, or approximately
shares immediately after the offering, or the average weekly reported
volume of trading of the common stock on the New York Stock Exchange during the
four calendar weeks preceding such sale. The holder may only sell such shares
through "brokers' transactions" or in transactions directly with a "market
maker," as such terms are defined in Rule 144. Sales under Rule 144 are also
subject to requirements regarding providing notice of such sales and the
availability of current public information concerning us. Affiliates may sell
shares not constituting restricted securities in accordance with the foregoing
volume limitations and other requirements but without regard to the one-year
holding period.

Under Rule 144(k), if a period of at least two years has elapsed between the
later of the date restricted securities were acquired from us or the date they
were acquired from an affiliate, as applicable, a holder of such restricted
securities who is not an affiliate at the time of the sale and has not been an
affiliate for at least three months prior to the sale would be entitled to sell
the shares in the public market without regard to the volume limitations and
other restrictions described above.

Securities issued in reliance on Rule 701, such as shares of common stock
acquired upon exercise of certain options granted under Linc.net stock plans,
are also restricted and, beginning 90 days after the effective date of this
prospectus, may be sold by stockholders other than affiliates of Linc.net
subject only to the manner of sale provisions of Rule 144 and by affiliates
under Rule 144 without compliance with its one-year holding period requirement.
Options to purchase an aggregate of shares of common stock are outstanding
under our 1999 stock option plan and long-term equity incentive plan. In
addition, we intend to file registration statements on Form S-8 as described
below.

REGISTRATION ON FORM S-8

We intend to file registration statements on Form S-8 under the Securities
Act to register approximately shares of common stock issuable under
our stock option plans. These registration statements are expected to be filed
within six months of the effective date of the registration statement of

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which this prospectus is a part and will be effective upon filing. Shares issued
upon the exercise of stock options after the effective date of the Form S-8
registration statements will be eligible for resale in the public market without
restriction, subject to Rule 144 limitations applicable to affiliates and the
lock-up agreements described below.

LOCK-UP AGREEMENTS

Notwithstanding the foregoing, Linc.net, our executive officers, directors
and substantially all of our existing stockholders and optionholders have agreed
not to offer, sell, contract to sell or otherwise dispose of any common stock
for a period of 180 days after the date of this prospectus without the prior
written consent of Morgan Stanley Dean Witter, except, in the case of Linc.net,
for the shares of common stock to be issued in connection with the offering,
pursuant to employee benefit plans existing on the date of this prospectus, upon
the exercise of options and warrants or the conversion of securities outstanding
on the date of this prospectus, or as consideration for the purchase by us of
any business or assets to parties that agree to be bound by the foregoing
restrictions, and certain permitted transfers to related parties that agree to
be bound by the foregoing restrictions and certain permitted sales of shares
acquired in the open market following the completion of the offering.

REGISTRATION AGREEMENT

Linc.net and some of its stockholders, including Banc One Equity Capital and
SKM and certain of their affiliates, have entered into a registration agreement,
under which holders of registrable securities have the right at any time after
our initial public offering, subject to certain conditions, to require us to
register any or all of their shares of common stock under the Securities Act on
Form S-1, a "long-form registration," at our expense or on Form S-2 or
Form S-3, or a "short-form registration," at our expense. We are not generally
required, however, to effect any such long-form registration or short-form
registration during any lock-up period imposed by an underwriter in an
underwritten public offering and may postpone the filing of such registration
for up to 90 days if we believe that such a registration would reasonably be
expected to have an adverse effect on any proposal or plan by us or any of our
subsidiaries to engage in an acquisition, merger or similar transaction.

In addition, all holders of registerable securities are entitled to request
the inclusion of any shares of common stock subject to the registration
agreement in any registration statement at our expense whenever we propose to
register any of our securities under the Securities Act, subject to customary
exceptions. Holders of registrable securities included in the registration have
the right to approve the underwriters for the offering. All such holders have
agreed not to exercise their registration rights in connection with this
offering.

In connection with all such registrations, we have agreed to indemnify all
holders of registerable securities against certain liabilities, including
liabilities under the Securities Act. In addition, all the parties to the
Registration Agreement have agreed not to make any public sales of their
registrable securities during any lock-up period imposed by an underwriter in an
underwritten public offering. The holders of an aggregate of shares of
common stock have rights under the registration agreement to require us to
register their shares of common stock under the Securities Act at our expense.

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MATERIAL U.S. FEDERAL TAX CONSEQUENCES TO NON-U.S. HOLDERS

GENERAL

The following is a general discussion of the principal U.S. federal income
and estate tax consequences of the purchase, ownership, and disposition of our
common stock by a Non-U.S. Holder. For this purpose, the term "Non-U.S. Holder"
is defined as any person or entity that is, for U.S. federal income tax
purposes, (i) a foreign corporation or other entity taxable as a corporation,
(ii) a nonresident alien individual, or (iii) a foreign estate or trust. If an
entity treated as a partnership for U. S. federal income tax purposes holds our
common shares, the tax treatment of each partner will generally depend upon the
status of the partner and upon the activities of the partnership. If you are a
partner of a partnership holding our common shares, you should consult your tax
advisor. This discussion is based on currently existing provisions of the
Internal Revenue Code of 1986, as amended, existing, temporary and proposed
Treasury regulations promulgated thereunder, and administrative and judicial
interpretations thereof, all as in effect or proposed on the date hereof and all
of which are subject to change, possibly with retroactive effect, or different
interpretations. This discussion is limited to Non-U.S. Holders who hold shares
of common stock as capital assets within the meaning of section 1221 of the
Internal Revenue Code. Moreover, this discussion is for general information only
and does not address all of the tax consequences that may be relevant to
particular Non-U.S. Holders in light of their personal circumstances. Special
tax rules that may apply to some Non-U.S. Holders, including banks, insurance
companies, dealers in securities and traders in securities who elect to apply a
market-to-market method of accounting, or special tax rules that may apply to a
Non-U.S. Holder that holds our common stock as part of a "straddle," "hedge" or
"conversion transaction," and, further, does not discuss certain tax provisions
which may apply to individuals who relinquish their U.S. citizenship or
residence.

An individual may, subject to certain exceptions, be deemed to be a resident
alien, as opposed to a nonresident alien, by virtue of being present in the
United States for at least 31 days in the calendar year and for an aggregate of
at least 183 days during a three-year period ending in the current calendar
year. For such purposes all of the days present in the current year, one-third
of the days present in the immediately preceding year, and one-sixth of the days
present in the second preceding year are counted. Resident aliens are subject to
U.S. federal income tax as if they were U.S. citizens and, thus, are not
Non-U.S. Holders for purposes of this discussion.

We have not and will not seek a ruling from the IRS with respect to the U.
S. federal income tax consequences described below, and as a result, there can
be no assurance that the IRS will not disagree with or challenge any of the
conclusions set forth in this discussion.

EACH PROSPECTIVE PURCHASER OF COMMON STOCK IS ADVISED TO CONSULT A TAX
ADVISOR WITH RESPECT TO CURRENT AND POSSIBLE FUTURE TAX CONSEQUENCES OF
PURCHASING, OWNING AND DISPOSING OF COMMON STOCK AS WELL AS ANY TAX CONSEQUENCES
THAT MAY ARISE UNDER THE LAWS OF ANY U.S. STATE, MUNICIPALITY OR OTHER TAXING
JURISDICTION, OR NON-U.S. TAXING JURISDICTION.

DIVIDENDS

In the event that dividends are paid on shares of common stock, dividends
paid to a Non-U.S. Holder of common stock generally will be subject to
withholding of U.S. federal income tax at a 30% rate or such lower rate as may
be specified by an applicable income tax treaty. To claim the benefit of a lower
federal income tax rate under an income tax treaty, a Non-U.S. Holder of common
stock must properly file with the payor an IRS Form 1001 or a Form W-8BEN, or
successor form, claiming an exemption from or reduction in withholding under
such tax treaty. A Form 1001 is replaced with a Form W-8BEN for payments after
December 31, 2000.

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However, any dividends paid on shares of common stock to a Non-U.S. Holder
will not be subject to withholding tax, but instead will be subject to U.S.
federal income tax on a net basis at applicable graduated individual or
corporate rates if:

- dividends are effectively connected with the conduct of a trade or
business by the Non-U.S. Holder within the United States and, where a tax
treaty applies, are attributable to a U.S. permanent establishment, or, in
the case of an individual, a "fixed base" in the U. S., of the Non-U.S.
Holder (collectively referred to as "U.S. trade or business income"); and

- an IRS Form 4224 or a Form W-8 ECI, or successor form, is filed with the
payor.

Any U. S. trade or business income received by a foreign corporation may, under
certain circumstances, be subject to an additional "branch profits tax" at a
rate of 30% or such lower rate as may be specified by an applicable income tax
treaty.

Unless the payor has knowledge to the contrary, dividends paid prior to
January 1, 2001 to an address outside the United States are presumed to be paid
to a resident of such country for purposes of the withholding discussed above
and for purposes of determining the applicability of a tax treaty rate. However,
recently finalized Treasury Regulations pertaining to U.S. federal withholding
tax (the "Final Withholding Tax Regulations") provide that a Non-U.S. Holder
must comply with certification procedures, or, in the case of payments made
outside the United States with respect to an offshore account, certain
documentary evidence procedures, directly or under specified circumstances
through an intermediary, to obtain the benefits of a reduced rate under an
income tax treaty with respect to dividends paid after December 31, 2000. In
addition, the Final Withholding Tax Regulations will require a Non-U.S. Holder
who provides an IRS Form W-8BEN or successor form, as discussed above, also to
provide its U.S. taxpayer identification number.

A Non-U.S. Holder of common stock eligible for a reduced rate of U.S.
withholding tax pursuant to an income tax treaty may obtain a refund of any
excess amounts withheld by filing an appropriate claim for refund with the IRS.

GAIN ON DISPOSITION OF COMMON STOCK

A Non-U.S. Holder generally will not be subject to U.S. federal income tax
with respect to gain recognized on a sale or other disposition of common stock
unless:

(1) the gain is a U. S. trade or business income;

(2) in the case of a Non-U.S. Holder who is an individual and holds the
common stock as a capital asset, such holder is present in United States
for 183 or more days in the taxable year of the sale or other disposition
and certain other conditions are met; or

(3) Linc.net is or has been a "U.S. real property holding corporation," or a
"USRPHC", for U.S. federal income tax purposes at any time within the
shorter of the five-year period preceding the disposition or the period
that the Non-U.S. Holder held the common stock as discussed below.

An individual Non-U.S. Holder who falls under clause (1) or (3) above will,
unless an applicable treaty provides otherwise, be taxed on his or her net gain
derived from the sale under regular graduated U.S. federal income tax rates. An
individual Non-U.S. Holder who falls under clause (2) above will be subject to a
flat 30% tax on the gain derived from the sale, which may be offset by certain
U.S. capital losses.

A Non-U.S. Holder that is a foreign corporation falling under clause (1)
above will be taxed on its gain under regular corporate U.S. federal income tax
rates and may be subject to an additional branch profits tax equal to 30% of its
effectively connected earnings and profits within the meaning of the Internal
Revenue Code for the taxable year, as adjusted for certain items, unless it
qualifies for a lower rate under an applicable income tax treaty.

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A corporation is a USRPHC if the fair market value of the U.S. real property
interests held by the corporation is 50% or more of the aggregate fair market
value of its U.S. and foreign real property interests and any other assets used
or held for use by the corporation in a trade or business. Based on its current
and anticipated assets, Linc.net believes that it is not currently, and is
likely not to become, a USRPHC. However, since the determination of USRPHC
status is based upon the composition of the assets of Linc.net from time to
time, and because there are uncertainties in the application of certain relevant
rules, there can be no assurance that Linc.net will not become a USRPHC. If
Linc.net were to become a USRPHC, then gain on the sale or other disposition of
common stock by a Non-U.S. Holder generally would be subject to U.S. federal
income tax unless both

- the common stock was "regularly traded" on an established securities
market within the meaning of the Code and applicable Treasury regulations;
and

- the Non-U.S. Holder actually or constructively owned 5% or less of the
common stock during the shorter of the five-year period preceding such
disposition or the Non-U.S. Holder's holding period.

Non-U.S. Holders should consult their tax advisors concerning any U.S. tax
consequences that may arise if Linc.net were to become a USRPHC.

FEDERAL ESTATE TAX

Common stock owned or treated as owned by an individual who is not a citizen
or resident, as defined for either United States federal income or estate tax
purposes, of the United States at the time of death will be included in such
holder's gross estate for U.S. federal estate tax purposes, and may be subject
to U.S. federal estate tax unless an applicable estate tax treaty provides
otherwise.

INFORMATION REPORTING AND BACKUP WITHHOLDING TAX

Linc.net must report annually to the IRS and to each Non-U.S. Holder the
amount of dividends paid to such holder and the tax withheld with respect to
such dividends, regardless of whether withholding was required. Copies of the
information returns reporting such dividends and withholding may also be made
available by the IRS to the tax authorities in the country in which the Non-U.S.
Holder resides under the provisions of an applicable income tax treaty or
certain other agreements.

Backup withholding is imposed at the rate of 31% on certain payments to
persons that fail to furnish identifying information to the payer. Backup
withholding generally will not apply to (a) dividends paid to a Non-U.S. Holder
that is subject to withholding at the 30% rate, or lower treaty rate, discussed
above, or (b) dividends paid prior to January 1, 2001 to a Non-U.S. Holder at an
address outside the United States unless the payer has knowledge that the payee
is a U.S. person. In the case of dividends paid after December 31, 2000, the
Final Withholding Tax Regulations provide that a Non-U.S. Holder generally will
be subject to withholding tax at a 31% rate unless specified certification
procedures, or, in the case of payments made outside the United States with
respect to an offshore account, documentary evidence procedures, are complied
with, directly or under certain circumstances through an intermediary. Backup
withholding and information reporting generally will also apply to dividends
paid on common stock at addresses inside the United States to Non-U.S. Holders
that fail to provide identifying information in the manner required. The Final
Withholding Tax Regulations provide presumptions under which a Non-U.S. Holder
would be subject to backup withholding and information reporting unless
certification from the holder of the Non-U.S. Holder's Non-U.S. status is
provided.

Payment of the proceeds of a sale of common stock effected by or through a
U.S. office of a broker is subject to both backup withholding at the rate of 31%
and information reporting unless the beneficial owner provides the payer with
its name and address and certifies under penalties of perjury that it is a
Non-U.S. Holder, or otherwise establishes an exemption. In general, backup
withholding and information reporting will not apply to a payment of the
proceeds of a sale of common stock by or through a foreign

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office of a broker. If, however, such broker is, for U.S. federal income tax
purposes, a U.S. person, a controlled foreign corporation, or a foreign person
that derives 50% or more if its gross income for certain periods from the
conduct of a trade or business in the United States, or, in addition, for
periods after December 31, 2000, a foreign partnership that at any time during
its tax year either is engaged in the conduct of a U. S. trade or business or
has as partners one or more U.S. persons that, in the aggregate, hold more than
50% of the income or capital interest in the partnership, such payments will be
subject to information reporting, but not backup withholding, unless (a) such
broker has documentary evidence in its records that the beneficial owner is a
Non-U.S. Holder and other specified conditions are met; or (b) the beneficial
owner otherwise establishes an exemption.

The Final Withholding Tax Regulations unify current certification procedures
and forms and clarify reliance standards. Except as noted above with respect to
foreign brokers that are partnerships, the Final Withholding Tax Regulations do
not significantly alter the substantive withholding and information reporting
requirements but do alter the procedures for claiming the benefits of an income
tax treaty and change the certification procedures relating to the receipt by
intermediaries of payments on behalf of the beneficial owner of shares of common
stock. Non-U. S. Holders should consult their own tax advisors regarding the
effect, if any, of the Final Withholding Tax Regulations on their particular
situations.

Backup withholding is not an additional tax. Any amounts withheld under the
backup withholding rules generally will be allowed as a refund or a credit
against the Non-U.S. Holder's U.S. federal income tax liability provided the
required information is furnished in a timely manner to the IRS.

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UNDERWRITERS

Under the terms and subject to the conditions contained in an underwriting
agreement dated the date of this prospectus the underwriters named below, for
whom Morgan Stanley & Co. Incorporated, Banc of America Securities LLC and First
Union Securities, Inc. are acting as representatives, have severally agreed to
purchase and we have agreed to sell to them severally, the number of shares
indicated below:

<TABLE>
<CAPTION>
NUMBER
OF
NAME SHARES
---- --------
<S> <C>
Morgan Stanley & Co. Incorporated...........................
Banc of America Securities LLC..............................
First Union Securities, Inc.................................
------
Total.......................................................
======
</TABLE>

The underwriters are offering the shares of common stock subject to their
acceptance of the shares from us and subject to prior sale. The underwriting
agreement provides that the obligations of the several underwriters to pay for
and accept delivery of the shares of common stock offered by this prospectus are
subject to the approval of certain legal matters by their counsel and to certain
other conditions. The underwriters are obligated to take and pay for all of the
shares of common stock offered by this prospectus if any such shares are taken.
However, the underwriters are not required to take and pay for the shares
covered by the underwriters over-allotment option described below.

The underwriters initially propose to offer part of the shares of common
stock directly to the public at the public offering price set forth on the cover
page of this prospectus and part to certain dealers at a price that represents a
concession not in excess of $ a share under the public offering price.
Any underwriter may allow, and such dealers may reallow, a concession not in
excess of $ a share to other underwriters or to certain dealers. After
the initial offering of the shares of common stock, the offering price and other
selling terms may from time to time be varied by the representatives.

We have granted to the underwriters an option, exercisable for 30 days from
the date of this prospectus, to purchase up to an aggregate of additional
shares of common stock at the public offering price listed on the cover page of
this prospectus, less underwriting discounts and commissions. The underwriters
may exercise this option solely for the purpose of covering over-allotments, if
any, made in connection with the offering of the shares of common stock offered
by this prospectus. To the extent this option is exercised, each underwriter
will become obligated, subject to certain conditions, to purchase about the same
percentage of additional shares of common stock as the number listed next to the
underwriter's name in the preceding table bears to the total number of shares of
common stock listed next to the names of all underwriters in the preceding
table. If the underwriters exercise the over-allotment option in full, the total
price to the public would be $ , the total underwriting discounts and
commissions would be $ and the total proceeds to Linc.net would be
$ .

The underwriters have informed us that they do not intend sales to
discretionary accounts to exceed five percent of the total number of shares of
common stock offered by them.

Linc.net intends to file an application for the common stock to be listed on
the New York Stock Exchange under the symbol "LN."

Each of Linc.net, our directors and executive officers and certain of our
stockholders have agreed that, without the prior written consent of Morgan
Stanley & Co. Incorporated on behalf of the underwriters, he, she or it will
not, during the period ending 180 days after the date of this prospectus:

- offer, pledge, sell, contract to sell, sell any option or contract to
purchase, purchase any option or contract to sell, grant any option, right
or warrant to purchase, lend or otherwise transfer or dispose of, directly
or indirectly, any shares of common stock or any securities convertible
into or exercisable or exchangeable for common stock or

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- enter into any swap or other arrangement that transfers to another, in
whole or in part, any of the economic consequences of ownership of the
common stock,

whether any transaction described above is to be settled by delivery of shares
of common stock or such other securities, in cash or otherwise.

The restrictions described in the immediately preceding paragraph do not
apply to:

- the sale of shares to the underwriters,

- the issuance by us of shares of common stock upon the exercise of an
option or a warrant or the conversion of a security outstanding on the
date of this prospectus of which the underwriters have been advised in
writing,

- the issuance by us of shares of common stock as consideration for the
purchase by us of any business or assets to parties that agree to be bound
by the restrictions above,

- transactions by any person other than us relating to shares of common
stock or other securities acquired in open market transactions after the
completion of this offering,

- certain permitted transfers by our stockholders to related parties that
agree to be bound by the restrictions above or

- issuances of shares of common stock or options to purchase shares of
common stock pursuant to our employee benefit plans in existence on the
date of this prospectus.

In addition, our officers, directors and certain of our stockholders have
agreed that, without the prior written consent of Morgan Stanley & Co.
Incorporated on behalf of the underwriters, none of such persons will, during
the period ending 180 days after the date of the prospectus, make any demand
for, or exercise any right with respect to, the registration of any shares of
common stock or any security convertible into or exercisable or exchangeable for
common stock.

From December 1999 to September 2000, affiliates of Banc of America
Securities LLC indirectly purchased an aggregate of shares of our
Series A mandatorily redeemable preferred stock, which will be reclassified into
shares of our common stock in connection with the reclassification, and
shares of our common stock for an aggregate purchase price of
$ (based on amounts contributed to SKM Equity II and SKM Equity III, in
which affiliates of Banc of America Securities LLC hold a 1.0% and 2.1%
ownership interest, respectively). The shares of our Series A mandatorily
redeemable preferred stock and common stock beneficially owned by affiliates of
Banc of America Securities LLC purchased within six months of September 11, 2000
may be deemed by the National Association of Securities Dealers, Inc. to be
underwriting compensation and would be restricted from sale, transfer,
assignment or hypothecation for a period of one year from the date of this
offering, except as otherwise permitted by the National Association of
Securities Dealers, Inc. Conduct Rule 2710(c)(7)(A). See "Principal
Stockholders."

From August 2000 to September 2000, affiliates of First Union
Securities, Inc. indirectly purchased an aggregate of shares of our
Series A mandatorily redeemable preferred stock, which will be reclassified into
shares of our common stock in connection with the reclassification, and
shares of our common stock for an aggregate purchase price of
$ (based on amounts contributed to SKM Equity III, in which affiliates
of First Union Securities hold a 2.8% ownership interest). The shares of our
Series A mandatorily redeemable preferred stock and common stock beneficially
owned by affiliates of First Union Securities, Inc. purchased within six months
of September 11, 2000 may be deemed by the National Association of Securities
Dealers, Inc. to be underwriting compensation and would be restricted from sale,
transfer, assignment or hypothecation for a period of one year from the date of
this offering, except as otherwise permitted by the National Association of
Securities Dealers, Inc. Conduct Rule 2710(c)(7)(A). See "Principal
Stockholders."

89
<PAGE>
In order to facilitate the offering of the common stock, the underwriters
may engage in transactions that stabilize, maintain or otherwise affect the
price of the common stock. Specifically, the underwriters may sell more shares
than they are obligated to purchase under the underwriting agreement, creating a
short position. A short sale is "covered" if the short position is no greater
than the number of shares available for purchase by the underwriters under the
over allotment option. The underwriters can close out a covered short sale by
exercising the over allotment option or purchasing shares in the open market. In
determining the source of shares to close out a covered short sale, the
underwriters will consider, among other things, the open market price of shares
compared to the price available under the over allotment option. The
underwriters may also sell shares in excess of the over allotment option,
creating a naked short position. The underwriters must close out any naked short
position by purchasing shares in the open market. A naked short position is more
likely to be created if the underwriters are concerned that there may be
downward pressure on the price of the common stock in the open market after
pricing that could adversely affect investors who purchase in the offering. In
addition, to stabilize the price of the common stock, the underwriters may bid
for, and purchase, shares of common stock in the open market. Finally, the
underwriting syndicate may reclaim selling concessions allowed to an underwriter
or a dealer for distributing the common stock in the offering, if the syndicate
repurchases previously distributed common stock to cover syndicate short
positions or to stabilize the price of the common stock. Any of these activities
may stabilize or maintain the market price of the common stock above independent
market levels. The underwriters are not required to engage in these activities,
and may end any of these activities at any time.

It is anticipated that Morgan Stanley Dean Witter Online, Inc. ("MSDW
Online"), an affiliate of Morgan Stanley Dean Witter, may be a member of the
syndicate and engage in electronic offers, sales and distribution of the shares
being offered.

MSDW Online uses the following procedures in electronic distribution of
securities. MSDW Online delivers the preliminary prospectus and any amendments
by posting electronic versions of such documents on its web site. Such documents
are delivered only to those customers who have agreed to accept Internet
delivery of the prospectus and any amendments thereto as indicated on both the
customer's Qualification Questionnaire and the customer's General Expression of
Interest Form. In addition to delivery through its web site, MSDW Online
delivers a final paper copy of the prospectus to each purchaser by mail.

The electronic version of the prospectus is identical to the electronic
version of the prospectus that the Company files via EDGAR, except that the
format matches that of the paper prospectus. There are no links leading from the
electronic version of the prospectus posted on the MSDW Online web site to other
web sites.

MSDW Online follows the following procedures for opening all accounts and
transacting trades in securities regardless of the type of transaction that a
customer is interested in executing:

- Each potential customer must complete an account application and open the
account with at least $2,000 cash or with securities with a fair market
value of at least $2,000.

- Once the account is opened, the customers may transact their trades
(1) over the Internet, (2) through a touch-tone phone or (3) over the
phone through a registered representative.

- Customers may make their trades only with cash balances in their account
or on margin.

MSDW Online follows specific procedures to allow customers to place an
indication of interest in a public offering. It requires its customers to have
funds in their account (unless securities are permissible to be purchased on
margin) on the trade date for any security transaction. Any customer who
expresses an interest in an offering is required to complete a Qualification
Questionnaire and a General Indication of Interest on a deal by deal basis. In
addition, each qualified MSDW Online customer must reconfirm his or her interest
in the offering after final pricing and effectiveness of the registration
statement or he or she will not be eligible to receive shares in the offering.

90
<PAGE>
OTHER RELATIONSHIPS

From time to time, Morgan Stanley & Co., Incorporated, Banc of America
Securities LLC and First Union Securities, Inc. have provided, and continue to
provide, investment banking services to us for which they have received
customary fees and commissions.

In addition, affiliates of Banc of America Securities LLC indirectly own an
aggregate of shares of our common stock and affiliates of First Union
Securities, Inc. beneficially own an aggregate of shares of our common
stock.

First Union Securities, Inc. is also an affiliate of a lender under our
senior credit facility. Such affiliate of First Union Securities, Inc. will also
receive its proportionate share of our repayment of amounts outstanding under
our senior credit facility from the net proceeds of this offering. See "Use of
Proceeds."

Linc.net and the underwriters have agreed to indemnify each other against
certain liabilities, including liabilities under the Securities Act.

DIRECTED SHARE PROGRAM

At our request, the underwriters have reserved up to of the shares of
common stock offered by this prospectus for sale at the initial public offering
price to some of our directors, officers, employees, business associates and
related persons of Linc.net. The number of shares available for sale to the
general public will be reduced to the extent that these persons purchase the
reserved shares. Any reserved shares not so purchased will be offered by the
underwriters to the general public on the same basis as the other shares offered
by this prospectus.

PRICING OF THE OFFERING

Prior to this offering, there has been no public market for the common
stock. Consequently, the initial public offering price will be determined by
negotiations between us and the representatives of the underwriters. Among the
factors to be considered in determining the initial public offering price will
be:

- our future prospects and the future prospects of our industry in general,

- the experience of our management,

- our revenue, earnings and other financial and operating information in
recent periods and

- the price-earnings ratios, price-revenue ratios, market prices of
securities and financial and operating information of companies engaged in
activities similar to ours.

The estimated initial public offering price range set forth on the cover
page of this prospectus is subject to change as a result of market conditions
and other factors.

91
<PAGE>
LEGAL MATTERS

The validity of the shares we are offering will be passed upon for us by
Kirkland & Ellis, Chicago, Illinois. Certain partners of Kirkland & Ellis are
partners in Randolph Street Partners, which owns shares of Linc.net common
stock. The validity of the shares we are offering will be passed upon for the
underwriters by Shearman & Sterling, New York, New York.

EXPERTS

Ernst & Young LLP, independent auditors, have audited the consolidated
financial statements of Linc.net, Inc. for the period from October 19, 1999 to
December 31, 1999, as set forth in their report. We've included these financial
statements in the prospectus and elsewhere in the registration statement in
reliance upon Ernst & Young LLP's report, given on their authority as experts in
accounting and auditing.

Ernst & Young LLP, independent auditors, have audited the combined financial
statements of M&P Utilities, Inc. and Muller & Pribyl Utilities, Inc. as of
December 31, 1998 and December 21, 1999 and for each of the years in the
two-year period ended December 31, 1998 and the period from January 1, 1999 and
December 21, 1999, as set forth in their report. We've included these financial
statements in the prospectus and elsewhere in the registration statement in
reliance on Ernst & Young LLP's report, given on their authority as experts in
auditing and accounting.

Ernst & Young LLP, independent auditors, have audited the financial
statements of Capital Land Services, Inc. as of December 31, 1998 and 1999, and
for each of the years in the three-year period ended December 31, 1999, as set
forth in their report. We've included these financial statements in the
prospectus and elsewhere in the registration statement in reliance upon Ernst &
Young LLP's report, given on their authority as experts in accounting and
auditing.

Ernst & Young LLP, independent auditors, have audited the combined financial
statements of C&B Associates, Ltd. and C&B Associates II, Ltd. as of
December 31, 1999 and for the period from January 1, 1999 to December 21, 1999,
as set forth in their report. We've included these financial statements in the
prospectus and elsewhere in the registration statement in reliance upon Ernst &
Young LLP's report, given on their authority as experts in accounting and
auditing.

Crawford, Carter, Thompson & Barron, L.L.P., independent auditors, have
audited the combined financial statements of C&B Associates, Inc. and C&B
Associates II, Ltd. as of December 31, 1998 and for each of the years in the
two-year period ended December 31, 1998, as set forth in their report. We've
included these financial statements in the prospectus and elsewhere in the
registration statement in reliance upon Crawford, Carter, Thompson &
Barron, L.L.P.'s report, given on their authority as experts in accounting and
auditing.

Ernst & Young LLP, independent auditors, have audited the financial
statements of North Shore Cable Contractors, Inc. as of December 31, 1998 and
1999, and for each of the years in the three-year period ended December 31,
1999, as set forth in their report. We've included these financial statements in
the prospectus and elsewhere in the registration statement in reliance upon
Ernst & Young LLP's report, given on their authority as experts in accounting
and auditing.

Ernst & Young LLP, independent auditors, have audited the financial
statements of Telpro Technologies, Inc. as of December 31, 1998 and 1999, and
for each of the years in the three-year period ended December 31, 1999, as set
forth in their report. We've included these financial statements in the
prospectus and elsewhere in the registration statement in reliance upon Ernst &
Young LLP's report, given on their authority as experts in accounting and
auditing.

BDO Seidman, LLP, independent auditors, have audited the financial
statements of Utility Consultants, Inc. as of September 30, 1998 and 1999, and
for each of the years in the three-year period ended September 30, 1999, as set
forth in their report. We've included these financial statements in the

92
<PAGE>
prospectus and elsewhere in the registration statement in reliance upon BDO
Seidman, LLP's report, given on their authority as experts in accounting and
auditing.

Ernst & Young LLP, independent auditors, have audited the financial
statements of Craig Enterprises, Inc. as of December 31, 1998 and 1999, and for
each of the years in the three-year period ended December 31, 1999, as set forth
in their report. We've included these financial statements in the prospectus and
elsewhere in the registration statement in reliance upon Ernst & Young LLP's
report, given on their authority as experts in accounting and auditing.

Marden, Harrison & Kreuter, independent auditors, have audited the financial
statements of Felix Industries, Inc. as of December 31, 1998 and 1999, and for
each of the years in the three-year period ended December 31, 1999, as set forth
in their report. We've included these financial statements in the prospectus and
elsewhere in the registration statement in reliance upon Marden, Harrison &
Kreuter's report, given on their authority as experts in accounting and
auditing.

Virchow, Krause & Company, LLP, independent auditors, have audited the
financial statements of InterCon Construction, Inc. as of January 2, 1999 and
January 1, 2000, and for each of the fiscal years then ended, as set forth in
their report. We've included these financial statements in the prospectus and
elsewhere in the registration statement in reliance upon Virchow, Krause &
Company, LLP's report, given on their authority as experts in accounting and
auditing.

McGladery & Pullen, LLP, independent auditors, have audited the financial
statements of InterCon Construction, Inc. as of January 3, 1998 and for the
fiscal year then ended, as set forth in their report. We've included these
financial statements in the prospectus and elsewhere in the registration
statement in reliance upon McGladery & Pullen, LLP's report, given on their
authority as experts in accounting and auditing.

WHERE YOU CAN FIND MORE INFORMATION

We have filed with the SEC a registration statement on Form S-1 pursuant to
the Securities Act, and the rules and regulations promulgated thereunder, with
respect to the shares of common stock offered hereby. This prospectus, which
constitutes part of the registration statement, does not contain all the
information set forth in the registration statement, certain parts of which are
omitted in accordance with the rules and regulations of the SEC. For further
information with respect to us and the common stock offered hereby, reference is
made to the registration statement. Statements made in this prospectus as to the
contents of any contract, agreement or other document referred to are not
necessarily complete. With respect to each such contract, agreement or other
document filed as an exhibit to the registration statement, reference is made to
the exhibit for a more complete description of the document or matter involved,
and each such statement shall be deemed qualified in its entirety by such
reference.

The registration statement, including the exhibits thereto, can be inspected
and copied at the public reference facilities maintained by the SEC at
Room 1024, 450 Fifth Street, N.W., Washington, D.C. 20549, at the Regional
Offices of the SEC (telephone number: 1-800-SEC-0330) at 7 World Trade Center,
13th Floor, New York, New York 10048 and at Citicorp Center, 500 West Madison
Street, Suite 1400, Chicago, Illinois 60661. Copies of such materials can be
obtained from the Public Reference Section of the SEC at 450 Fifth
Street, N.W., Washington, D.C. 20549, at prescribed rates. The SEC maintains a
website that contains reports, proxy and information statements and other
information regarding registrants that file electronically with the SEC. The
address of such site is http://www.sec.gov. You may also review our reports at
the offices of the New York Stock Exchange, located at 20 Broad Street, New
York, New York 10005.

93
<PAGE>
INDEX TO FINANCIAL STATEMENTS

<TABLE>
<CAPTION>
PAGE
--------
<S> <C>
LINC.NET INC.--CONSOLIDATED FINANCIAL STATEMENTS

Report of Independent Auditors.............................. F-1-1
Consolidated Balance Sheet as of December 31, 1999.......... F-1-2
Consolidated Statement of Operations for the period from
October 19, 1999 (date operations commenced) to
December 31, 1999......................................... F-1-3
Consolidated Statement of Stockholders' Equity for the
period from October 19, 1999 (date operations commenced)
to December 31, 1999...................................... F-1-4
Consolidated Statement of Cash Flows for the period from
October 19, 1999 (date operations commenced) to
December 31, 1999......................................... F-1-5
Notes to Consolidated Financial Statements.................. F-1-6
Condensed Consolidated Balance Sheet as of June 30, 2000
(unaudited)............................................... F-1-16
Condensed Consolidated Statement of Operations for the six
months ended June 30, 2000 (unaudited).................... F-1-17
Condensed Consolidated Statement of Cash Flows for the six
months ended June 30, 2000 (unaudited).................... F-1-18
Notes to Condensed Consolidated Financial Statements
(unaudited)............................................... F-1-19

M&P UTILITIES, INC. AND MULLER & PRIBYL
UTILITIES, INC.--COMBINED FINANCIAL STATEMENTS

Report of Independent Auditors.............................. F-2-1
Combined Balance Sheets as of December 31, 1998 and
December 21, 1999......................................... F-2-2
Combined Statements of Income for the years ended December
31, 1997 and 1998 and period from January 1, 1999 to
December 21, 1999......................................... F-2-3
Combined Statements of Stockholders' Equity for the years
ended December 31, 1997 and 1998 and period from January
1, 1999 to December 21, 1999.............................. F-2-4
Combined Statements of Cash Flows for the years ended
December 31, 1997 and 1998 and period from January 1, 1999
to December 21, 1999...................................... F-2-5
Notes to Combined Financial Statements...................... F-2-6

CAPITAL LAND SERVICES, INC.--FINANCIAL STATEMENTS

Report of Independent Auditors.............................. F-3-1
Balance Sheets as of December 31, 1998 and October 19,
1999...................................................... F-3-2
Statements of Operations and Retained Earnings for the years
ended December 31, 1997 and 1998 and the period from
January 1, 1999 to October 19, 1999....................... F-3-3
Statements of Cash Flows for the years ended December 31,
1997 and 1998 and the period from January 1, 1999 to
October 19, 1999.......................................... F-3-4
Notes to Financial Statements............................... F-3-5

C&B ASSOCIATES, LTD. (FORMERLY C&B ASSOCIATES, INC.) AND C&B
ASSOCIATES II, LTD.--COMBINED FINANCIAL STATEMENTS

Report of Independent Auditors.............................. F-4-1
Combined Balance Sheet as of December 21, 1999.............. F-4-2
Combined Statement of Income for the period from January 1,
1999 to December 21, 1999................................. F-4-3
Combined Statement of Partnerships' Equity for the period
from January 1, 1999 to December 21, 1999................. F-4-4
Combined Statement of Cash Flows for the year ended
December 21, 1999......................................... F-4-5
Notes to Combined Financial Statements...................... F-4-6
Report of Independent Auditors.............................. F-4-11
</TABLE>

F-1
<PAGE>

<TABLE>
<CAPTION>
PAGE
--------
<S> <C>
Combined Balance Sheets as of December 31, 1997 and 1998.... F-4-12
Combined Statements of Income for the years ended December
31, 1997 and 1998......................................... F-4-13
Combined Statements of Stockholders' Equity for the years
ended December 31, 1997 and 1998.......................... F-4-14
Combined Statements of Cash Flows for the years ended
December 31, 1997 and 1998................................ F-4-15
Notes to Combined Financial Statements...................... F-4-16

NORTH SHORE CABLE CONTRACTORS, INC.--FINANCIAL STATEMENTS

Report of Independent Auditors.............................. F-5-1
Balance Sheets as of December 31, 1998 and 1999............. F-5-2
Statements of Operations for the years ended December 31,
1997, 1998 and 1999....................................... F-5-3
Statements of Stockholders' Equity (Deficit) for the years
ended December 31, 1997, 1998 and 1999.................... F-5-4
Statements of Cash Flows for the years ended December 31,
1997, 1998 and 1999....................................... F-5-5
Notes to Financial Statements............................... F-5-6

TELPRO TECHNOLOGIES, INC.--FINANCIAL STATEMENTS

Report of Independent Auditors.............................. F-6-1
Balance Sheets as of December 31, 1998 and 1999............. F-6-2
Statements of Operations for the years ended December 31,
1997, 1998 and 1999....................................... F-6-3
Statements of Stockholders' (Deficit) Equity for the years
ended December 31, 1997, 1998 and 1999.................... F-6-4
Statements of Cash Flows for the years ended December 31,
1997, 1998 and 1999....................................... F-6-5
Notes to Financial Statements............................... F-6-6
Condensed Balance Sheets as of June 30, 1999 and 2000
(unaudited)............................................... F-6-13
Condensed Statements of Operations for the six months ended
June 30, 1999 and 2000 (unaudited)........................ F-6-14
Condensed Statements of Cash Flows for the six months ended
June 30, 1999 and 2000 (unaudited)........................ F-6-15
Notes to Condensed Financial Statements (unaudited)......... F-6-16

UTILITY CONSULTANTS, INC.--FINANCIAL STATEMENTS

Independent Auditors' Report................................ F-7-1
Balance Sheets as of September 30, 1998 and 1999............ F-7-2
Statements of Operations for the years ended September 30,
1997, 1998 and 1999....................................... F-7-3
Statements of Stockholders' Equity for the years ended
September 30, 1997, 1998 and 1999......................... F-7-4
Statements of Cash Flows for the years ended September 30,
1997, 1998 and 1999....................................... F-7-5
Summary of Significant Accounting Policies.................. F-7-6
Notes to Financial Statements............................... F-7-8
Condensed Balance Sheets as of March 31, 1999 and 2000
(unaudited)............................................... F-7-11
Condensed Statements of Operations for the six months ended
March 31, 1999 and 2000 (unaudited)....................... F-7-12
Condensed Statements of Cash Flows for the six months ended
March 31, 1999 and 2000 (unaudited)....................... F-7-13
Notes to Condensed Financial Statements (unaudited)......... F-7-14

CRAIG ENTERPRISES, INC.--FINANCIAL STATEMENTS

Report of Independent Auditors.............................. F-8-1
Balance Sheets as of June 30, 1999 and June 16, 2000........ F-8-2
</TABLE>

F-2
<PAGE>

<TABLE>
<CAPTION>
PAGE
--------
<S> <C>
Statements of Income for the years ended June 30, 1998 and
1999, and period from July 1, 1999 to June 16, 2000....... F-8-3
Statements of Stockholders' Equity for the years ended June
30, 1998 and 1999, and period from July 1, 1999 to June
16, 2000.................................................. F-8-4
Statements of Cash Flows for the years ended June 30, 1998
and 1999, and period from July 1, 1999 to June 16, 2000... F-8-5
Notes to Financial Statements............................... F-8-6

FELIX EQUITIES, INC. AND AFFILIATES--COMBINED FINANCIAL
STATEMENTS

Report of Independent Auditors.............................. F-9-1
Combined Balance Sheets as of September 30, 1998 and 1999... F-9-2
Combined Statements of Income and Retained Earnings for the
years ended September 30, 1997, 1998 and 1999............. F-9-4
Combined Statements of Cash Flows for the years ended
September 30, 1997, 1998 and 1999......................... F-9-5
Notes to Combined Financial Statements...................... F-9-8
Condensed Combined Balance Sheets as of June 30, 1999 and
2000 (unaudited).......................................... F-9-18
Condensed Combined Statements of Operations for the nine
months ended June 30, 1999 and 2000 (unaudited)........... F-9-19
Condensed Combined Statements of Cash Flows for the nine
months ended June 30, 1999 and 2000 (unaudited)........... F-9-20
Notes to Condensed Combined Financial Statements
(unaudited)............................................... F-9-22

INTERCON CONSTRUCTION, INC.--FINANCIAL STATEMENTS

Independent Auditors' Report................................ F-10-1
Balance Sheets as of January 2, 1999 and January 1, 2000.... F-10-2
Statements of Income for the fiscal years ended January 2,
1999 and January 1, 2000.................................. F-10-3
Statements of Changes in Components of Stockholders' Equity
for the fiscal years ended January 2, 1999 and January 1,
2000...................................................... F-10-4
Statements of Cash Flows for the fiscal years ended
January 2, 1999 and January 1, 2000....................... F-10-5
Notes to Financial Statements............................... F-10-7
Independent Auditor's Report................................ F-10-14
Balance Sheet as of January 3, 1998......................... F-10-15
Statement of Income for the fiscal year ended January 3,
1998...................................................... F-10-16
Statement of Stockholders' Equity for the fiscal year ended
January 3, 1998........................................... F-10-17
Statement of Cash Flows for the fiscal year ended January 3,
1998...................................................... F-10-18
Notes to Financial Statements............................... F-10-19
Condensed Consolidated Balance Sheets as of June 30, 1999
and 2000 (unaudited)...................................... F-10-23
Condensed Consolidated Statements of Income for the six
months ended June 30, 1999 and 2000 (unaudited)........... F-10-24
Condensed Consolidated Statements of Cash Flows for the six
months ended June 30, 1999 and 2000 (unaudited)........... F-10-25
Notes to Condensed Consolidated Financial Statements
(unaudited)............................................... F-10-26
</TABLE>

F-3
<PAGE>
REPORT OF INDEPENDENT AUDITORS

The Board of Directors
Linc.net, Inc.

We have audited the accompanying consolidated balance sheet of Linc.net, Inc. as
of December 31, 1999, and the related consolidated statements of operations,
common stockholders' equity, and cash flows for the period from October 19, 1999
(date operations commenced) to December 31, 1999. These financial statements are
the responsibility of the Company's management. Our responsibility is to express
an opinion on these financial statements based on our audit.

We conducted our audit in accordance with auditing standards generally accepted
in the United States. Those standards require that we plan and perform the audit
to obtain reasonable assurance about whether the financial statements are free
of material misstatement. An audit includes examining, on a test basis, evidence
supporting the amounts and disclosures in the financial statements. An audit
also includes assessing the accounting principles used and significant estimates
made by management, as well as evaluating the overall financial statement
presentation. We believe that our audit provides a reasonable basis for our
opinion.

In our opinion, the financial statements referred to above present fairly, in
all material respects, the consolidated financial position of Linc.net, Inc. at
December 31, 1999, and the consolidated results of its operations and its cash
flows for the period from October 19, 1999 (date operations commenced) to
December 31, 1999, in conformity with accounting principles generally accepted
in the United States.

ERNST & YOUNG LLP

Chicago, Illinois
April 27, 2000

F-1-1
<PAGE>
LINC.NET, INC.

CONSOLIDATED BALANCE SHEET

DECEMBER 31, 1999

(AMOUNTS IN THOUSANDS, EXCEPT SHARE DATA)

<TABLE>
<S> <C>
ASSETS
Current assets:
Cash...................................................... $ 3,549
Accounts receivable, including retainage of $1,780 (less
allowance of $115)...................................... 22,202
Costs and estimated earnings in excess of billings on
uncompleted contracts................................... 1,962
Inventory................................................. 379
Prepaids and other assets................................. 726
Deferred income taxes..................................... 540
--------
Total current assets........................................ 29,358

Fixed assets, net........................................... 14,973
Goodwill, net............................................... 63,367
Deferred financing costs, net............................... 2,081
Other noncurrent assets..................................... 697
--------
Total assets................................................ $110,476
========

LIABILITIES AND COMMON STOCKHOLDERS' EQUITY
Current liabilities:
Current portion of long-term debt......................... $ 6,049
Revolving credit facility................................. 2,687
Accounts payable, including retainage of $761............. 6,699
Accrued expenses.......................................... 3,339
Billings in excess of costs and estimated earnings on
uncompleted contracts................................... 271
Current portion of capital lease obligations.............. 121
--------
Total current liabilities................................... 19,166

Long-term debt, less current portion........................ 52,750
Capital lease obligations, less current portion............. 463
Deferred income taxes....................................... 11

Mandatorily redeemable preferred stock, $.01 par value,
100,000 shares authorized; 37,265 shares issued and
outstanding............................................... 37,517

Common stockholders' equity:
Common stock, $.01 par value, 1,000,000 shares authorized;
414,084 shares issued and outstanding................... 4
Additional paid-in capital................................ 4,137
Accumulated deficit....................................... (1,082)
Excess of purchase price over predecessor basis........... (2,490)
--------
Total common stockholders' equity........................... 569
--------
Total liabilities and common stockholders' equity........... $110,476
========
</TABLE>

See accompanying notes to consolidated financial statements.

F-1-2
<PAGE>
LINC.NET, INC.

CONSOLIDATED STATEMENT OF OPERATIONS

PERIOD FROM OCTOBER 19, 1999 (DATE OPERATIONS COMMENCED)
TO DECEMBER 31, 1999

(AMOUNTS IN THOUSANDS, EXCEPT SHARE DATA)

<TABLE>
<S> <C>
Net revenue................................................. $ 1,760
Costs of sales.............................................. 1,581
-------
Gross profit................................................ 179
Costs and expenses:
General and administrative expenses....................... 868
Amortization of goodwill.................................. 107
Management fees........................................... 250
-------
Total operating expenses.................................... 1,225
-------
Loss from operations........................................ (1,046)

Other income (expense):
Interest income........................................... --
Interest expense.......................................... (360)
Other income, net......................................... 47
-------
Total other expense, net.................................... (313)
-------

Loss before income taxes.................................... (1,359)
Income tax benefit.......................................... 529
-------
Net loss.................................................... (830)
Preferred stock dividends................................... (252)
-------
Net loss to common stockholders............................. $(1,082)
=======

Loss per common share--Basic................................ $ (7.51)
=======
</TABLE>

See accompanying notes to consolidated financial statements.

F-1-3
<PAGE>
LINC.NET, INC.

CONSOLIDATED STATEMENT OF COMMON STOCKHOLDERS' EQUITY

(AMOUNTS IN THOUSANDS, EXCEPT SHARE DATA)

<TABLE>
<CAPTION>
EXCESS
PURCHASE PRICE TOTAL
COMMON STOCK ADDITIONAL OVER COMMON
-------------------- PAID-IN ACCUMULATED PREDECESSOR STOCKHOLDERS'
SHARES AMOUNT CAPITAL DEFICIT BASIS EQUITY
-------- --------- ---------- ----------- -------------- -------------
<S> <C> <C> <C> <C> <C> <C>
Inception........................... -- $ -- $ -- $ -- $ -- $ --
Issuance of common stock............ 414,084 4 4,137 -- -- 4,141
Effect of use of carryover basis
from acquired company............. -- -- -- -- (2,490) (2,490)
Net loss............................ -- -- -- (830) -- (830)
Dividends on preferred stock........ -- -- -- (252) -- (252)
------- --------- ------ ------- ------- -------
Balance at December 31, 1999........ 414,084 $ 4 $4,137 $(1,082) $(2,490) $ 569
======= ========= ====== ======= ======= =======
</TABLE>

See accompanying notes to consolidated financial statements.

F-1-4
<PAGE>
LINC.NET, INC.

CONSOLIDATED STATEMENT OF CASH FLOWS

PERIOD FROM OCTOBER 19, 1999 (DATE OPERATIONS COMMENCED)
TO DECEMBER 31, 1999

(AMOUNTS IN THOUSANDS)

<TABLE>
<S> <C>
CASH FLOWS FROM OPERATING ACTIVITIES
Net loss.................................................... $ (830)
Adjustments to reconcile net loss to net cash used by
operating activities:
Depreciation.............................................. 47
Amortization.............................................. 125
Provision for doubtful accounts........................... 95
Deferred income taxes..................................... (529)
Changes in operating assets and liabilities (net of
acquired companies):
Accounts receivable..................................... 622
Costs and estimated earnings in excess of billings...... (1,053)
Prepaid expenses........................................ (149)
Accounts payable........................................ 854
Accrued expenses........................................ 776
--------
Net cash used by operating activities....................... (42)

CASH FLOWS FROM INVESTING ACTIVITIES
Acquisition of CLS, net of cash acquired.................... (17,358)
Acquisition of M&P, net of cash acquired.................... (43,035)
Acquisition of C&B, net of cash acquired.................... (36,180)
Transaction costs paid on target acquisitions............... (498)
Capital expenditures........................................ (32)
--------
Net cash used by investing activities....................... (97,103)

CASH FLOWS FROM FINANCING ACTIVITIES
Proceeds from debt.......................................... 58,700
Payment of deferred financing costs......................... (2,099)
Borrowings from revolving credit facility................... 2,687
Proceeds from issuance of preferred stock................... 37,265
Proceeds from issuance of common stock...................... 4,141
--------
Net cash provided by financing activities................... 100,694
--------
Increase in cash............................................ 3,549
Cash at beginning of period................................. --
--------
Cash at end of year......................................... $ 3,549
========
</TABLE>

See accompanying notes to consolidated financial statements.

F-1-5
<PAGE>
LINC.NET, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(AMOUNTS IN THOUSANDS, EXCEPT SHARE DATA)

DECEMBER 31, 1999

1. FORMATION OF LINC.NET, INC. AND DESCRIPTION OF BUSINESS

Linc.net, Inc. (the Company) was incorporated on October 18, 1999, in
accordance with the laws of the State of Delaware. The Company operates as a
supplier of network infrastructure services to telecommunications, Internet,
cable TV providers and to a lesser extent, energy companies.

2. ACQUISITIONS

On October 19, 1999, the Company acquired Capital Land Services, Inc. (CLS)
for $17,358, including $2,206 of assumed liabilities, acquisition costs of
$1,775, and net of cash acquired of $80. The purchase price was paid in cash and
was financed by: (i) $8,300 in proceeds from the issuance of term loans,
(ii) $9,679 in proceeds from the issuance of stock, and (iii) borrowings of $184
under the Company's revolving credit agreement. A portion of the proceeds from
the term loans and capital stock was used to pay $563 of debt financing costs.

CLS's assets and liabilities assumed have been recorded at their fair
values. As a result of the continuing equity interest by a certain shareholder
of CLS, the excess of purchase price over the estimated fair value of net assets
acquired of $12,053 reflects a reduction of $2,490 for the excess of the
purchase price over the predecessor's basis as required by generally accepted
accounting principles.

Total consideration of $17,438 exceeded the fair value of net assets
acquired and the predecessor's carryover basis in the net assets acquired by
$12,053. The fair values of net assets acquired are summarized as follows:

<TABLE>
<S> <C>
Trade receivables........................................... $ 2,977
Fixed assets................................................ 123
Other assets................................................ 135
Accounts payable and accrued expenses....................... (339)
-------
Estimated fair value of net assets acquired................. 2,896
Excess of purchase price over predecessor's basis........... 2,489
Excess of purchase price over estimated fair value of net
assets acquired and predecessor's carryover basis......... 12,053
-------
Total consideration......................................... $17,438
=======
</TABLE>

On December 21, 1999, the Company acquired Muller & Pribyl Utilities, Inc.
and M&P Utilities, Inc. (collectively, M&P) and C&B Associates, Ltd. and C&B
Associates II, Ltd. (collectively, C&B) for $79,215, including $7,058 of assumed
liabilities, acquisition costs of $4,009, and net of cash acquired of $3,034.
The purchase price was paid in cash and was financed by: (i) $50,400 in proceeds
from the issuance of term loans, (ii) $31,727 in proceeds from the issuance of
stock, and (iii) borrowings of $2,003 under the Company's revolving credit
agreement. A portion of the debt and equity proceeds was used to pay $1,536 of
debt financing costs.

M&P's and C&B's assets and liabilities assumed have been recorded at their
estimated fair values, and are subject to adjustment when additional information
concerning fixed asset valuations and other accruals is finalized.

F-1-6
<PAGE>
LINC.NET, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

(AMOUNTS IN THOUSANDS, EXCEPT SHARE DATA)

2. ACQUISITIONS (CONTINUED)
Total consideration for M&P and C&B of $82,250 exceeded the estimated fair
value of net assets acquired by $51,421. The fair value of M&P's and C&B's net
assets acquired is summarized as follows:

<TABLE>
<S> <C>
Trade receivables........................................... $20,159
Fixed assets................................................ 14,866
Cash........................................................ 3,034
Costs and estimated earnings in excess of billings on
uncompleted contracts..................................... 403
Other assets................................................ 892
Accounts payable and accrued expenses....................... (7,842)
Indebtedness................................................ (683)
-------
Estimated fair value of net assets acquired................. 30,829
Excess of purchase price over estimated fair value of net
assets acquired........................................... 51,421
-------
Total consideration......................................... $82,250
=======
</TABLE>

The acquisitions described above were accounted for by the purchase method
of accounting and, accordingly, the results of operations for these acquisitions
have been included in the Company's consolidated financial statements from their
respective dates of acquisition.

The following unaudited pro forma information presents the results of
operations of the Company as if the acquisition of M&P and C&B had taken place
on October 19,1999, the date operations commenced. The pro forma results of
operations have been prepared for comparative purposes only and do not purport
to be indicative of the results of operations which actually would have resulted
had the acquisitions occurred on the date indicated, or which may result in the
future.

<TABLE>
<S> <C>
Revenues.................................................... $21,282
Net loss.................................................... 83
Net loss to common stockholders............................. 335
Net loss per share to common stockholders................... 2.33
</TABLE>

3. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

REVENUE RECOGNITION

The Company recognizes revenue based on the percentage-of-completion units
produced accounting method. Accordingly, revenue from services provided to
customers is reported as earned as measured by the completion of units produced
under the contract. Billings are prepared according to specific terms of
individual contracts. Contracts generally provide for periodic payments as the
work is completed with final amounts due upon completion and acceptance by the
customer. Unbilled revenues represent amounts earned and recognized in the
period for which billings are issued in the following period.

F-1-7
<PAGE>
LINC.NET, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

(AMOUNTS IN THOUSANDS, EXCEPT SHARE DATA)

3. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
Revenues from engineering and project management services are recognized
when the service has been provided.

INCOME TAXES

The Company uses the liability method of accounting for income taxes. Under
this method, deferred tax assets and liabilities are determined based on
differences between the carrying amounts of assets and liabilities for financial
reporting purposes and the amounts used for income tax purposes, and are
measured using the enacted tax rates at which the resulting taxes are expected
to be paid.

USE OF ESTIMATES

PRINCIPLES OF CONSOLIDATION

The consolidated financial statements include the accounts of the Company
and its wholly owned subsidiaries. All significant intercompany accounts and
transactions have been eliminated in consolidation.

INVENTORY

Inventory is stated at the lower of cost or market, using the first in,
first out method.

FIXED ASSETS

Fixed assets are recorded at cost, less accumulated depreciation. Equipment
under capital leases is stated at the present value of minimum lease payments or
fair value at the inception of the lease, whichever is lower. Depreciation is
calculated using the straight-line method over the estimated useful life of the
assets. Equipment held under capital leases approximated $580 and is amortized
using the straight-line method over the shorter of the lease term or estimated
useful life of the assets, with the related amortization included in
depreciation expense.

The useful lives of fixed assets are as follows:

<TABLE>
<S> <C>
Equipment................................................... 3 to 7 years
Furniture and fixtures...................................... 3 to 5 years
Vehicles.................................................... 3 to 5 years
Computers................................................... 1 to 3 years
</TABLE>

CONCENTRATION OF CREDIT RISK

The Company performs ongoing credit evaluations of its customers' financial
condition. The Company believes its credit granting and collection procedures
are sufficient to eliminate the risk of significant bad debt losses.

F-1-8
<PAGE>
LINC.NET, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

(AMOUNTS IN THOUSANDS, EXCEPT SHARE DATA)

3. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
The Company maintains cash with a financial institution, which at times
exceeds the FDIC insured limits. The Company limits the amount of credit
exposure with financial institutions and believes that no significant
concentration of credit risk exists with respect to cash.

DEFERRED FINANCING COSTS

Deferred financing costs represent capitalized fees and expenses associated
with obtaining financing. The costs are being amortized using the straight-line
method, which approximates the interest method, over the shorter of the terms of
the related loans or the period such loans are expected to be outstanding.
Accumulated amortization of deferred financing costs at December 31, 1999, was
$18.

GOODWILL

The excess of purchase price over the fair value of assets acquired
(goodwill) is being amortized on a straight-line basis over its estimated
remaining economic life of 20 years. Accumulated amortization of goodwill at
December 31, 1999, was $107.

LONG-LIVED ASSETS

The Company evaluates its long-lived assets, including goodwill, on an
ongoing basis. Long-lived assets are reviewed for impairment whenever events or
changes in circumstances indicate that the carrying amount of the related asset
may not be recoverable. Recoverability of assets to be held and used is measured
by a comparison of the carrying amount of the asset to future undiscounted cash
flows expected to be generated by the asset. If the asset is determined to be
impaired, the impairment recognized is measured by the amount by which the
carrying value of the asset exceeds its fair value.

FAIR VALUE OF FINANCIAL INSTRUMENTS

The Company's financial instruments include cash, credit facility
borrowings, and term loans (see Note 7). The fair values of the Company's
financial instruments were not materially different from their carrying values
at December 31, 1999. The Company estimates the fair value of its obligations
using the discounted cash flow method with interest rates currently available
for similar obligations.

4. COSTS AND ESTIMATED EARNINGS ON UNCOMPLETED CONTRACTS

<TABLE>
<S> <C>
Costs incurred on uncompleted contracts..................... $16,032
Estimated earnings.......................................... 4,755
-------
20,787
Less: Billings to date...................................... (19,331)
-------
$ 1,456
=======
</TABLE>

F-1-9
<PAGE>
LINC.NET, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

(AMOUNTS IN THOUSANDS, EXCEPT SHARE DATA)

4. COSTS AND ESTIMATED EARNINGS ON UNCOMPLETED CONTRACTS (CONTINUED)
The foregoing balance is included in the accompanying balance sheet under
the following captions:

<TABLE>
<S> <C>
Costs and estimated earnings in excess of billings on
uncompleted contracts..................................... $1,727
Billings in excess of costs and estimated earnings on
uncompleted contracts..................................... (271)
------
$1,456
======
</TABLE>

5. FIXED ASSETS

Fixed assets consist of the following as of December 31, 1999:

<TABLE>
<S> <C>
Equipment................................................... $10,274
Vehicles.................................................... 4,626
Computers................................................... 70
Furniture and fixtures...................................... 50
-------
15,020
Less: Accumulated depreciation.............................. (47)
-------
$14,973
=======
</TABLE>

6. ACCRUED EXPENSES

Accrued expenses consist of the following as of December 31, 1999:

<TABLE>
<S> <C>
Accrued payables............................................ $ 951
Payroll and benefits........................................ 593
Accrued project costs....................................... 405
Interest.................................................... 328
Due to affiliates........................................... 250
Taxes, including taxes other than income.................... 369
Other....................................................... 443
------
$3,339
======
</TABLE>

F-1-10
<PAGE>
LINC.NET, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

(AMOUNTS IN THOUSANDS, EXCEPT SHARE DATA)

7. DEBT

The Company's debt consists of the following at December 31, 1999:

<TABLE>
<S> <C>
Revolving credit facility................................... $ 2,687
Term loan A................................................. 31,300
Term loan B................................................. 27,400
Note payable................................................ 99
-------
61,486
Less: Revolving credit facility............................. (2,687)
-------
58,799
Less: Current portion of long-term debt..................... (6,049)
-------
Long-term debt.............................................. $52,750
=======
</TABLE>

In connection with the CLS acquisition on October 19, 1999, the Company
entered into a credit agreement, as amended, that provides for a revolving
credit facility (the revolver) and two term loan facilities, Term loan A and
Term loan B, up to $122 million. The funds available under the credit agreement
may be used for acquisitions and general corporate needs. The revolver commits
cash borrowings and letters of credit (not to exceed $3 million) totaling the
lesser of $20 million or the Company's borrowing base. The Company's borrowing
base equals 85% of qualifying accounts receivable and 50% of qualifying
inventory. At December 31, 1999, the Company had borrowings outstanding of
$2,687 and unused credit available of $17,313 under the revolver. At
December 31, 1999, no letters of credit were outstanding. The revolver expires
October 19, 2004.

Principal payments on the term loan borrowings under the credit agreement,
as amended, are due quarterly commencing March 2000 and are based on a
percentage of the term loan commitments. The quarterly repayment percentage
ranges from 3.5% to 8.67% for Term loan A obligations with the last payment due
September 2004 and from .25% to 15.834% for Term loan B obligations with the
last payment due September 2006.

The revolver and term loans provide, at the Company's option, interest at:
(i) the greater of the prime rate or the Federal Funds rate, plus the applicable
margin, as defined in the credit agreement (the base rate loans), or (ii) the
Euro-Rate, as defined in the credit agreement, plus the applicable margin (the
Euro-Rate loans). The applicable margin for the revolver is between 1.0% and
1.75% for the base rate loans and between 2.5% and 3.25% for the Euro-Rate
loans. The applicable margin for the term loans is between 1.0% and 2.25% for
the base rate loans and between 2.5% and 3.75% for the Euro-Rate loans, in each
case based on the Company's consolidated leverage ratio as defined. At
December 31, 1999, borrowings under the revolver, Term loan A, and Term loan B
bore interest at 10%, 10%, and 10.5%, respectively.

Interest on the revolver and term loans is payable quarterly on the base
rate loans and for the Euro-Rate loans at the earlier of maturity or 90 days.

The credit agreement calls for a commitment fee payable quarterly in arrears
based on the average daily difference between the revolver commitment and the
sum of revolver borrowings and letters of credit

F-1-11
<PAGE>
LINC.NET, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

(AMOUNTS IN THOUSANDS, EXCEPT SHARE DATA)

7. DEBT (CONTINUED)
outstanding. The rate is .5% per annum through the initial adjustment date as
defined in the credit agreement and will range thereafter from .375% to .5%
based upon the Company's leverage ratio.

The credit agreement is secured by a first priority lien on substantially
all of the Company's assets. The credit agreement also contains covenants
restricting the Company's ability to: (i) incur additional indebtedness,
(ii) dispose of property, (iii) declare or pay dividends, and (iv) transact with
affiliates. The credit agreement also requires the Company to enter into an
interest rate protection agreement in 2000 for a three-year period covering
approximately 50% of the term loans advanced to the Company.

Aggregate maturities of long-term debt at December 31, 1999, are as follows:

<TABLE>
<S> <C>
2000........................................................ $ 6,049
2001........................................................ 7,550
2002........................................................ 8,350
2003........................................................ 9,150
2004........................................................ 2,050
Thereafter.................................................. 25,650
-------
$58,799
=======
</TABLE>

8. PREFERRED STOCK

The Company issued 37,265 shares of cumulative, mandatorily redeemable,
nonvoting, Series A preferred stock for proceeds of $37,265. Each share of
preferred stock has a par value of $.01 and a liquidation value of $1,000 per
share, and it accumulates dividends at a rate of 10.0% per annum of the
liquidation value. Upon the liquidation, dissolution, or winding up of the
Company, or on the first business day of October 2006, whichever comes sooner,
the preferred stock must be redeemed at its liquidation value together with any
unpaid dividends which approximates $37,517 in aggregate at December 31, 1999.
As of December 31, 1999, $252 of dividends were accumulated and unpaid.

9. INCOME TAXES

The benefit for income taxes consists of the following for the period from
October 19, 1999 to December 31, 1999:

<TABLE>
<S> <C>
Deferred:
Federal................................................... $447
State..................................................... 82
----
Income tax benefit.......................................... $529
====
</TABLE>

F-1-12
<PAGE>
LINC.NET, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

(AMOUNTS IN THOUSANDS, EXCEPT SHARE DATA)

9. INCOME TAXES (CONTINUED)
The income tax benefit differs from the amount of income tax benefit
computed by applying the U.S. federal income tax rate to loss before income
taxes for the period from October 19, 1999 to December 31, 1999. A
reconciliation of the difference is as follows:

<TABLE>
<S> <C>
Income tax benefit at statutory federal tax rate............ $476
Increase resulting from state and local tax benefits, net of
federal effect............................................ 53
----
Benefit for income taxes.................................... $529
====
</TABLE>

The tax effect of temporary differences that gave rise to deferred tax
assets consists of the following at December 31, 1999:

<TABLE>
<S> <C>
Excess purchase price over predecessor's basis.............. $ 968
Net operating loss carryforward............................. 503
Other--Principally accruals................................. 26
-----
Total deferred assets....................................... 1,497
Less: Valuation allowance................................... (968)
-----
Net deferred tax assets..................................... $ 529
=====
</TABLE>

The Company recorded $968 of deferred tax assets in connection with the CLS
acquisition relating to the amount of purchase price deductible for tax and not
for books. The Company's net operating losses expire in the year 2020.

In assessing the realizability of deferred tax assets, management considers
whether it is more likely than not that some portion or all of the deferred tax
assets will not be realized. The ultimate realization of deferred tax assets is
dependent upon the generation of future taxable income during the periods in
which those temporary differences become deductible. Management considers the
scheduled reversal of deferred tax liabilities, tax planning strategies, and
projected future taxable income in making this assessment. Based upon the level
of historical taxable income of the acquired companies (see Note 2) and
projections for future taxable income over the periods during which the deferred
tax assets are deductible, management believes it is more likely than not the
Company will realize the benefits of these deductible differences, net of the
existing valuation allowance at December 31, 1999.

10. RELATED PARTY TRANSACTIONS

MANAGEMENT AGREEMENTS

The Company entered into cancelable management service agreements with
stockholders that have seven-year terms. The fees associated with the agreements
are payable quarterly and will not exceed $1,000 per year in aggregate. For the
period from October 19, 1999 to December 31, 1999, the Company recorded $250 in
expense associated with these agreements.

F-1-13
<PAGE>
LINC.NET, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

(AMOUNTS IN THOUSANDS, EXCEPT SHARE DATA)

10. RELATED PARTY TRANSACTIONS (CONTINUED)
RELATED PARTY LEASES

The Company leases certain operating facilities and offices under operating
leases from stockholders that commence in 2000. Future minimum rental payments
required under these leases are $48 and $27 for 2000 and 2001, respectively.

11. BENEFIT PLANS AND OTHER COMPENSATION

The Company maintains defined-contribution 401(k) plans and a profit-sharing
retirement plan that covers substantially all of its employees. The plans
provide for discretionary employer contributions. The Company's cost recognized
as expense associated with these plans for the period from October 19, 1999 to
December 31, 1999 was zero.

In 1999, the Company adopted a stock option plan. Under the plan, the Board
of Directors, at its discretion, can issue options for up to 25,000 shares of
common stock. The exercise price and vesting periods are determined by the Board
of Directors on the issuance date. No options were issued during the period from
October 19, 1999 to December 31, 1999.

12. LEASE COMMITMENTS

The Company leases various assets whose terms and conditions qualify the
obligations for treatment as capital leases.

The Company also leases certain facilities and equipment under various
noncancelable operating lease agreements. Future minimum lease payments under
capital and noncancelable operating leases, including those with related
parties, as of December 31, 1999, are as follows:

<TABLE>
<CAPTION>
CAPITAL OPERATING
LEASES LEASES
-------- ---------
<S> <C> <C>
2000....................................................... $ 168 $604
2001....................................................... 168 51
2002....................................................... 162 17
2003....................................................... 125 --
2004....................................................... 33 --
Thereafter................................................. -- --
----- ----
Total minimum lease payments............................... 656 $672
====
Less: Amount representing interest......................... (72)
-----
Present value of net minimum capital lease payments........ 584
Less: Current portion of obligations under capital
leases................................................... (121)
-----
Obligations under capital leases, excluding current
installments............................................. $ 463
=====
</TABLE>

Rent expense was $108 for the period from October 19, 1999 to December 31,
1999.

F-1-14
<PAGE>
LINC.NET, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

(AMOUNTS IN THOUSANDS, EXCEPT SHARE DATA)

13. ADDITIONAL PURCHASE PRICE ARRANGEMENTS

The terms of the Company's CLS and C&B acquisition agreements provide for
additional consideration to be paid if the respective acquired entity's results
of operations exceed certain targeted levels. The targeted levels are set above
the historical experience of the acquired entity at the time of acquisition.
Provided the targets are achieved or exceeded, the additional consideration for
CLS and C&B would be paid in 2000 and 2001, respectively, at which time it would
be recorded as additional goodwill.

14. SEGMENT INFORMATION

The Company operates in a single segment: network infrastructure services to
the telecommunications, Internet, cable TV providers and to a lesser extent
energy companies. All of the Company's revenues are derived in the United
States.

15. LOSS PER SHARE

Basic loss per share is shown on the face of the statement of operations.
Basic loss per share is based on the weighted average number of common shares
outstanding from October 19, 1999 to December 31, 1999.

The following table sets forth the computation of basic loss per share:

<TABLE>
<S> <C>
Net loss.................................................... $ (830)
Preferred stock dividends................................... (252)
-------
Net loss of common stockholders............................. (1,082)

Weighted average number of common shares outstanding........ 143,954

Net loss per share--Basic................................... $ 7.51
=======
</TABLE>

16. SUBSEQUENT EVENTS

On January 21, 2000, the Company acquired the stock of North Shore Cable
Contractors, Inc. (NSC) for $5,752. NSC is primarily engaged in the installation
of underground utilities consisting of conduit/fiber optic cable. The
acquisition was financed through the Company's credit agreement and stock
issuances.

On March 13, 2000, the Company acquired a 55.6% interest (44.1% voting
control) in Telpro Technologies, Inc. (Telpro) for $18.3 million. Telpro
provides telecommunication equipment, engineering, design and installation
services to the central offices of major network providers.

F-1-15
<PAGE>
LINC.NET, INC.

CONDENSED CONSOLIDATED BALANCE SHEET

JUNE 30, 2000

(UNAUDITED)
(AMOUNTS IN THOUSANDS)

<TABLE>
<S> <C>
ASSETS

Current assets:
Cash and cash equivalents................................. $ 3,233
Accounts receivable (less allowances of $115)............. 38,247
Costs and estimated earnings in excess of billings on
uncompleted contracts................................... 18,314
Inventory................................................. 231
Prepaids and other assets................................. 3,305
Due from affiliate........................................ 16,641
--------
Total current assets........................................ 79,971

Fixed assets, net........................................... 29,758
Goodwill, net............................................... 119,442
Deferred financing costs, net............................... 5,726
Investments in affiliate.................................... 21,195
Other noncurrent assets..................................... 521
--------
Total assets................................................ $256,613
========

LIABILITIES AND COMMON STOCKHOLDERS' EQUITY

Current liabilities:
Current portion of long-term debt......................... $ 2,846
Revolving credit facility................................. 9,750
Accounts payable and accrual expenses..................... 23,637
Billings in excess of costs and estimated earnings on
uncompleted contracts................................... 942
Current portion of capital lease obligations.............. 168
--------
Total current liabilities................................... 37,343

Long-term debt, less current portion........................ 131,160
Capital lease obligations, less current portion............. 340
Series A mandatorily redeemable preferred stock, $.01 par
value, 125,000 shares authorized; 75,915 shares issued and
outstanding............................................... 78,807
Stockholders' equity:

Common stock, $.01 par value, 1,500,000 shares authorized;
907,505 shares issued and outstanding..................... 9
Series B redeemable preferred stock, $.01 par value, 25,000
shares authorized; 5,760 shares issued and outstanding.... 5,919
Additional paid-in capital.................................. 9,066
Accumulated deficit......................................... (3,313)
Stockholder loans........................................... (228)
Excess of purchase price over predecessor basis............. (2,490)
--------
Total stockholders' equity.................................. 8,963
--------
Total liabilities and stockholders' equity.................. $256,613
========
</TABLE>

See accompanying notes to condensed consolidated financial statements.

F-1-16
<PAGE>
LINC.NET, INC.

CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS

SIX MONTHS ENDED JUNE 30, 2000

(UNAUDITED)
(AMOUNTS IN THOUSANDS)

<TABLE>
<S> <C>
Net revenue................................................. $67,717
Costs of sales.............................................. 55,647
-------
Gross profit.............................................. 12,070
General and administrative expenses......................... 6,395
Amortization of goodwill.................................... 2,124
Management fees............................................. 500
-------
Total operating expenses.................................... 9,019
-------

Income from operations.................................... 3,051
Other income (expense):
Interest income........................................... 17
Interest expense.......................................... (5,110)
Other income, net......................................... 64
-------
Total other expense, net.................................... (5,029)
-------
(Loss) before income taxes and equity in income of
investees................................................. (1,978)
Equity in income of investees............................... 1,754
-------
(Loss) before income taxes.................................. (224)
Income tax benefit.......................................... 791
-------
Net income.................................................. 567
Preferred stock dividends................................... (2,798)
-------
Net loss to common stockholders............................. $(2,231)
=======
Loss per common share--basic................................ $ (4.02)
=======
</TABLE>

See accompanying notes to condensed consolidated financial statements.

F-1-17
<PAGE>
LINC.NET, INC.

CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS

SIX MONTHS ENDED JUNE 30, 2000

(UNAUDITED)
(AMOUNTS IN THOUSANDS)

<TABLE>
<S> <C>
CASH FLOWS FROM OPERATING ACTIVITIES
Net Income.................................................. $ 567
Adjustment to reconcile net income to net cash used in
operating activities:
Depreciation.............................................. 2,100
Amortization.............................................. 2,381
Equity in income of investee.............................. (1,754)
Deferred income taxes..................................... (811)
Changes in operating assets and liabilities (net of
acquired companies):
Accounts receivable..................................... 1,767
Prepaid expenses and other current assets............... (1,102)
Inventory............................................... 148
Costs and estimated earnings in excess of billings,
net................................................... (13,751)
Other assets............................................ 253
Accounts payable........................................ (120)
Accrued expenses........................................ 3,584
Due from affiliate...................................... (16,653)
---------
Net cash used in operating activities....................... (23,391)

INVESTING ACTIVITIES
Acquisitions, net of cash acquired........................ (79,598)
Capital expenditures...................................... (4,237)
Investments in Telpro..................................... (19,429)
---------
Net cash used in investing activities....................... (103,264)

FINANCING ACTIVITIES
Proceeds from issuance of debt............................ 76,950
Principal payments on debt................................ (2,410)
Payment of debt issuance costs............................ (3,902)
Net proceeds from revolving credit facility............... 7,063
Payments under capital lease obligations.................. (478)
Proceeds from the issuance of stock....................... 49,118
---------
Net cash provided by financing activities................... 126,341
---------
Net decrease in cash and cash equivalents................... (314)
Cash and cash equivalents at beginning of period............ 3,547
---------
Cash and cash equivalents at end of period.................. $ 3,233
=========
</TABLE>

See accompanying notes to condensed consolidated financial statements.

F-1-18
<PAGE>
LINC.NET, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

JUNE 30, 2000

(UNAUDITED)

(IN THOUSANDS, EXCEPT SHARE DATA)

1. ORGANIZATION

Linc.net, Inc. (the Company) was incorporated on October 18, 1999, in
accordance with the laws of the state of Delaware. The Company operates as a
supplier of network infrastructure services to telecommunications, Internet,
cable TV providers and to a lesser extent, energy companies.

2. INTERIM FINANCIAL INFORMATION

The accompanying unaudited condensed financial statements have been prepared
in accordance with generally accepted accounting principles for interim
financial information and with instruction to Form 10-Q 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 the opinion of management, all adjustments (consisting
of normal recurring accruals) considered necessary for a fair presentation have
been included. Operating results for the six month period ended June 30, 2000
are not necessarily indicative of the results that may be expected for the
fiscal year ending December 31, 2000. These financial statements should be read
in conjunction with the financial statements, including the notes thereto, for
the period from October 19, 1999 to December 31, 1999.

The preparation of financial statements in conformity with generally
accepted accounting principles requires management to make estimates and
assumptions that affect the amounts reported in the financial statements and
accompanying notes. Actual results could differ from those estimates.

3. ACQUISITIONS

On January 21, 2000 the Company acquired all of the outstanding stock of
North Shore Cable Cable Contractors, Inc. (NSC) for $6.1 million. The purchase
price, including costs incurred directly related to the transaction, was
preliminarily allocated to working capital of approximately $.5 million and
fixed assets of approximately $1.1 million, non-current liabilities of $.9
million and resulted in an excess purchase price over net identifiable assets of
approximately $5.4 million. NSC provides network infrastructure installation
services primarily to the telecommunications and cable industries.

On March 13, 2000 the Company acquired a 55.6% interest (44.1% voting
control) in Telpro Technologies, Inc. (Telpro) for $16.2 million. On May 19,
2000 the Company acquired additional shares for $1.1 million which resulted in
the Company owning a 59.4% interest (49.0% voting control). The Company has
agreed to acquire the remaining outstanding shares of Telpro, contingent upon
the occurrence of certain events. The Company has accounted for their investment
in Telpro under the equity method of accounting until a controlling interest in
Telpro is obtained. Telpro provides telecommunication equipment, engineering,
design and installation services to the central offices of major network
providers.

On May 3, 2000 the Company acquired all of the outstanding stock of George
M. Construction, Inc. (George M) for $22.1 million. The purchase price,
including costs incurred directly related to the transaction, was preliminarily
allocated to working capital of approximately $5.0 million and fixed assets of
approximately $5.1 million and resulted in an excess purchase price over net
identifiable assets of approximately $12.0 million. George M.'s specializes in
the installation of public utility telecommunications infrastructure.

F-1-19
<PAGE>
LINC.NET, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

JUNE 30, 2000

(UNAUDITED)

(IN THOUSANDS, EXCEPT SHARE DATA)

3. ACQUISITIONS (CONTINUED)
On May 8, 2000 the Company acquired all of the outstanding stock of Utility
Consultants, Inc. (UCI) for $17.3 million. The purchase price, including costs
incurred directly related to the transaction, was preliminarily allocated to
working capital of approximately $7.3 million, non-current liabilities of
$.4 million and fixed assets of approximately $.8 million and resulted in an
excess purchase price over net identifiable assets of approximately $9.6
million. UCI provides engineering and design and build services to the
telecommunications and electrical industries.

On May 10, 2000 the Company acquired certain net assets of Communicor
Corporation USA (Communicor) for $12.8 million. The purchase price, including
costs incurred directly related to the transaction, was preliminarily allocated
to working capital (deficit) of approximately $(1.7) million and fixed assets of
approximately $1.0 million and resulted in an excess purchase price over net
identifiable assets of approximately $13.5 million. Communicor provides network
infrastructure services primarily to the telecommunications industry.

On June 16, 2000 the Company acquired all of the outstanding stock of Craig
Enterprises, Inc. (Craig) for $24.3 million. The purchase price, including costs
incurred directly related to the transaction, was preliminarily allocated to
working capital of approximately $2.3 million, non-current liabilities of
$.6 million and fixed assets of approximately $4.7 million and resulted in an
excess purchase price over net identifiable assets of approximately
$17.9 million. Craig provides network infrastructure services primarily to the
telecommunications industry.

The NSC, George M., UCI, Communicor and Craig acquisitions described above
have been accounted for by the purchase method of accounting and accordingly,
the results of operations for these acquisitions have been included in the
Company's condensed consolidated financial statements from their respective
dates of acquisitions.

Unaudited pro forma information with respect to the Company as if the 2000
acquisitions had occurred on January 1, 2000 is as follows:

<TABLE>
<S> <C>
Net revenue................................................. $217,767
Income before income taxes.................................. 10,063
Net income to common stockholders........................... 5,725
Net income per share to common stockholders................. $ 10.30
</TABLE>

4. DEBT

On June 16, 2000, the Company entered into an amended and restated senior
credit facility that increased the previous facility from $122 million to
$230 million. Under the new credit facility, the Company may borrow up to
$30 million in revolving credit loans and letters of credit and up to
$200 million in term loans ($100 million in Term Loan A and $100 million in Term
Loan B). All revolving loans, if any, mature on June 16, 2005. The term loans
mature in quarterly installments on March 31, June 30, September 30 and
December 31 of each year beginning on March 31, 2001 (Term Loan A series)

F-1-20
<PAGE>
LINC.NET, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

JUNE 30, 2000

(UNAUDITED)

(IN THOUSANDS, EXCEPT SHARE DATA)

4. DEBT (CONTINUED)
and June 30, 2000 (Term Loan B series) and ending in December 2005 (Term Loan A
series) and March 2007 (Term Loan B series).

Borrowings under the credit facility bear interest at a floating rate and
may be maintained as base rate loans or, at our option, as Euro-rate loans. Base
rate loans bear interest at the base rate plus an applicable margin for the
revolving credit facility and the Term Loan A facility and 250 basis points for
the Term Loan B facility. Base rate is defined in the senior credit facility as
the higher of the interest rate per annum announced from time to time by PNC
Bank and the federal funds effective rate, plus one half percent ( 1/2%) per
annum. Euro-rate loans bear interest at the Euro-rate as described in the
amended senior credit facility, plus an applicable margin for the bank credit
facility and the Term Loan A facility, and 400 basis points for the Term Loan B
facility.

Under the senior credit facility the Company must also pay commitment fees,
which are calculated at a rate per annum based on certain financial covenants in
the case of the revolving credit loans, and based on a percentage of the
difference between committed amounts and amounts actually borrowed in the case
of the Term Loan A facility.

Voluntary prepayments of amounts outstanding under the amended senior credit
facility are permitted at any time, so long as the Company gives notice as
required by the facility. However, if a prepayment is made with respect to a
Euro-rate loan and the prepayment is made on a date other than an interest
payment date, the Company must pay a fee to compensate the lender for losses and
expenses incurred as a result of the prepayment.

The amended senior credit facility requires the Company to meet certain
financial tests, including, without limitation, minimum fixed charge coverage
ratios, a maximum leverage ratio and a minimum interest coverage ratio. In
addition, the amended senior credit facility contains certain covenants which,
among other things, limit the incurrence of additional indebtedness,
investments, dividends, transactions with affiliates, asset sales, acquisitions,
mergers and consolidations, prepayments of other indebtedness, liens and
encumbrances and other matters customarily restricted in such agreements.

The senior credit facility is secured by a first priority security interest
in all of our receivables, contracts, contract rights, equipment, intellectual
property, inventory and all other tangible and intangible assets and each of the
Company's domestic subsidiaries, subject to certain customary exceptions and a
pledge of all capital stock of any direct and indirect domestic subsidiaries.

The Company has a program in place which covers approximately $29.8 million
of outstanding indebtedness as of June 30, 2000, for purposes of reducing the
Company's exposure to interest rate fluctuations. On February 28, 2000, the
Company entered into an interest rate swap agreement with PNC Bank, National
Association. The initial notional principal amount of the agreement was
$31.0 million, with such amount decreasing on a quarterly basis to approximately
$21.9 million on March 1, 2003, when the agreement terminates. This agreement
establishes a fixed rate of 10.55% for such debt.

F-1-21
<PAGE>
LINC.NET, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

JUNE 30, 2000

(UNAUDITED)

(IN THOUSANDS, EXCEPT SHARE DATA)

5. STOCK ISSUANCES

Concurrent with each of the acquisitions described above (see note 3) the
Company sold stock to finance the related acquisition. In aggregate, the Company
issued 84,170 and 5,790 shares of Series A mandatorily redeemable preferred
stock and Series B redeemable preferred stock, respectively, and 998,108 shares
of common stock for approximately $49.5 million in proceeds.

6. LOSS PER SHARE

Basic loss per share is shown on the face of the statement of operations.
Basic loss per share is based on the weighted average number of common shares
outstanding for the six months ending June 30, 2000. The following table sets
forth the computation of basic loss per share:

<TABLE>
<S> <C>
Net income.................................................. $ 567
Preferred stock dividends................................... (2,798)
--------
Net loss to common stockholders............................. $ (2,231)
--------
Weighted Average number of common shares outstanding........ 555,663

Net loss per share--basic................................... $ 4.02
</TABLE>

7. INVENTORIES

Inventory is stated at the lower of cost or market, using the first in,
first out method. Inventory consists principally of parts purchased for resale
or for use in construction activities. Accordingly, there is no work in process
or finished goods inventory.

8. INFORMATION ON INVESTEES

On March 13, 2000 the Company acquired a non-controlling interest in Telpro.
The Company is accounting for their ownership of Telpro under the equity method
of accounting. The following additional summarized income statement information
regarding Telpro's stand-alone results of operations for the period from
March 14, 2000 to June 30, 2000 is provided below:

<TABLE>
<S> <C>
Net revenue................................................. $17,631
Gross profit................................................ 10,885
Income before taxes......................................... 5,153
-------
Net income.................................................. $ 3,092
=======
</TABLE>

9. SUBSEQUENT EVENTS

On August 3, 2000 the Company acquired all of the outstanding stock of Felix
Equities, Inc. and Affiliates (Felix) for $96.2 million. The purchase price,
including costs incurred directly related to the transaction, was preliminarily
allocated to working capital of approximately $2.0 million and fixed assets of
approximately $8.7 million and resulted in an excess purchase price over net
identifiable assets of approximately $85.5 million.

F-1-22
<PAGE>
REPORT OF INDEPENDENT AUDITORS

The Board of Directors and Stockholders of
M & P Utilities, Inc., and Muller & Pribyl Utilities, Inc.

We have audited the accompanying combined balance sheet of M&P
Utilities, Inc. and Muller & Pribyl Utilities, Inc. (collectively, the Company)
as of December 31, 1998 and December 21, 1999, and the related combined
statements of income, stockholders' equity, and cash flows for the years ended
December 31, 1997 and 1998 and for the period from January 1, 1999 to
December 21, 1999. These financial statements are the responsibility of the
Company's management. Our responsibility is to express an opinion on these
financial statements based on our audits.

We conducted our audits in accordance with auditing standards generally
accepted in the United States. Those standards require that we plan and perform
our audit to obtain reasonable assurance about whether the financial statements
are free of material misstatement. An audit includes examining, on a test basis,
evidence supporting the amounts and disclosures in the financial statements. An
audit also includes assessing the accounting principles used and significant
estimates made by management, as well as evaluating the overall financial
statement presentation. We believe that our audits provide a reasonable basis
for our opinion.

In our opinion, the combined financial statements referred to above present
fairly, in all material respects, the combined financial position of the Company
at December 31, 1998 and December 21, 1999, and the combined results of its
operations and its cash flows for years ended December 31, 1997 and 1998 and for
the period from January 1, 1999 to December 21, 1999, in conformity with
accounting principles generally accepted in the United States.

ERNST & YOUNG LLP

Chicago, Illinois
July 14, 2000

F-2-1
<PAGE>
M & P UTILITIES, INC. AND
MULLER & PRIBYL UTILITIES, INC.

COMBINED BALANCE SHEETS

(AMOUNTS IN THOUSANDS)

<TABLE>
<CAPTION>
DECEMBER 31 DECEMBER 21
1998 1999
----------- -----------
<S> <C> <C>
ASSETS
Current assets:
Cash and cash equivalents................................. $ 2,275 $ 970
Accounts receivable, including retainage of $393 and
$1,781
(less allowance of $20)................................. 6,208 13,369
Unbilled revenues......................................... 52 516
Inventory................................................. 123 149
Prepaid expenses and other current assets................. 55 109
------- -------
Total current assets........................................ 8,713 15,113
Fixed assets, net........................................... 6,328 6,716
------- -------
Total assets................................................ $15,041 $21,829
======= =======
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable.......................................... $ 1,257 $ 3,091
Accrued expenses.......................................... 339 1,409
Allowance for losses on contracts......................... -- 135
Accrued transaction costs................................. -- 2,215
Additional costs to be incurred in completion of
contracts............................................... 80 405
Accrued bonuses........................................... -- 2,270
Advance billings.......................................... 301 958
Note payable.............................................. 43 99
Current portion of capital lease obligations.............. -- 121
------- -------
Total current liabilities................................... 2,020 10,703

Capital lease obligations, less current portion............. -- 463

Stockholders' equity
Common stock.............................................. 2 2
Additional paid-in-capital................................ 802 802
Retained earnings......................................... 12,217 9,859
------- -------
Total stockholders' equity.................................. 13,021 10,663
------- -------
Total liabilities and stockholders' equity.................. $15,041 $21,829
======= =======
</TABLE>

See accompanying notes.

F-2-2
<PAGE>
M & P UTILITIES, INC. AND
MULLER & PRIBYL UTILITIES, INC.

COMBINED STATEMENTS OF INCOME

(AMOUNTS IN THOUSANDS)

<TABLE>
<CAPTION>
PERIOD
FROM
YEARS ENDED JANUARY 1
DECEMBER 31 1999 TO
------------------- DECEMBER 21
1997 1998 1999
-------- -------- -----------
<S> <C> <C> <C>
Net revenue................................................. $22,652 $28,900 $ 43,916
Costs of sales.............................................. 16,408 22,672 32,701
------- ------- --------
Gross profit................................................ 6,244 6,228 11,215
General and administrative expenses......................... 1,343 1,446 1,781
------- ------- --------
Income from operations...................................... 4,901 4,782 9,434

Other income (expense):
Interest income........................................... 85 55 97
Interest expense.......................................... (166) (16) (34)
Transaction costs related to sale of company.............. -- -- (4,485)
Other income (expense).................................... 153 1 (31)
------- ------- --------
Total other income (expense), net........................... 72 40 (4,453)
------- ------- --------
Income before state income taxes............................ 4,973 4,822 4,981
Provision for state income taxes............................ 5 51 71
------- ------- --------
Net income.................................................. $ 4,968 $ 4,771 $ 4,910
======= ======= ========
</TABLE>

See accompanying notes.

F-2-3
<PAGE>
M & P UTILITIES, INC. AND
MULLER & PRIBYL UTILITIES, INC.

COMBINED STATEMENTS OF STOCKHOLDERS' EQUITY

(DOLLARS IN THOUSANDS, EXCEPT SHARE AND PER SHARE DATA)

<TABLE>
<CAPTION>
M&P UTILITIES, INC. MULLER & PRIBYL UTILITIES,INC.
---------------------------------------------- ---------------------------------------------
ADDITIONAL ADDITIONAL
COMMON PAID-IN RETAINED COMMON PAID-IN RETAINED
SHARES STOCK (1) CAPITAL EARNINGS SHARES STOCK (2) CAPITAL EARNINGS TOTAL
-------- ----------- ---------- -------- -------- --------- ----------- -------- --------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Balance at December 31,
1996................... 100 $ -- $302 $ 891 200 $ 2 $ -- $ 7,162 $ 8,357
Net income............... -- -- -- 3,869 -- -- -- 1,099 4,968
Distributions to
stockholders........... -- -- -- (53) -- -- -- (2,261) (2,314)
--- ----------- ---- ------- --- ---- ----------- ------- -------
Balance at December 31,
1997................... 100 -- 302 4,707 200 2 -- 6,000 11,011
Net income............... -- -- -- 3,671 -- -- -- 1,100 4,771
Contributed capital...... -- -- 500 -- -- -- -- -- 500
Distributions to
stockholders........... -- -- -- (1,042) -- -- -- (2,219) (3,261)
--- ----------- ---- ------- --- ---- ----------- ------- -------
Balance at December 31,
1998................... 100 -- 802 7,336 200 2 -- 4,881 13,021
--- ----------- ---- ------- --- ---- ----------- ------- -------
Net income............... -- -- -- 3,932 -- -- -- 978 4,910
Distributions to
stockholders........... -- -- -- (4,730) -- -- -- (2,538) (7,268)
--- ----------- ---- ------- --- ---- ----------- ------- -------
Balance at December 21,
1999................... 100 -- $802 $ 6,538 200 $ 2 $ -- $ 3,321 $10,663
=== =========== ==== ======= === ==== =========== ======= =======
</TABLE>

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

(1) No par value, 2,500 shares authorized; 100 shares issued and outstanding.

(2) $10 par value, 200 shares authorized, issued, and outstanding.

See accompanying notes.

F-2-4
<PAGE>
M & P UTILITIES, INC. AND
MULLER & PRIBYL UTILITIES, INC.

COMBINED STATEMENTS OF CASH FLOWS

(AMOUNTS IN THOUSANDS)

<TABLE>
<CAPTION>
YEAR ENDED PERIOD FROM
DECEMBER 31 JANUARY 1 1999 TO
------------------- DECEMBER 21
1997 1998 1999
-------- -------- -----------------
<S> <C> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES
Net income................................................. $ 4,968 $ 4,771 $ 4,910
Adjustments to reconcile net income to net cash provided by
operating activities:
Depreciation............................................. 1,137 1,338 1,540
Gain on disposals of fixed assets........................ (11) (1) --
Provision for doubtful accounts.......................... -- 20 --
Changes in operating assets and liabilities:
Decrease (increase) in operating assets:
Accounts receivable and unbilled revenues............ 237 (1,568) (7,625)
Inventory............................................ (8) (110) (26)
Prepaid expenses and other current assets............ 890 403 (54)
Increase (decrease) in operating liabilities:
Accounts payable..................................... (191) 32 1,834
Accrued expenses..................................... 255 115 6,672
------- ------- -------
Net cash provided by operating activities.................. 7,277 5,000 7,251
CASH FLOWS FROM INVESTING ACTIVITIES
Purchase of fixed assets, net.............................. (2,208) (2,031) (1,251)
------- ------- -------
Cash used in investing activities.......................... (2,208) (2,031) (1,251)
CASH FLOWS FROM FINANCING ACTIVITIES
Proceeds of debt........................................... 221 -- 99
Principal payments on debt................................. (1,101) (177) (43)
Payment on capital lease obligations....................... -- -- (93)
Capital contribution from stockholders..................... -- 500 --
Distributions.............................................. (2,314) (3,261) (7,268)
------- ------- -------
Net cash used in financing activities...................... (3,194) (2,938) (7,305)
------- ------- -------
Increase (decrease) in cash and cash equivalents........... 1,875 31 (1,305)
Cash and cash equivalents at beginning of year............. 369 2,244 2,275
------- ------- -------
Cash and cash equivalents at end of year................... $ 2,244 $ 2,275 $ 970
======= ======= =======
Supplemental disclosures of cash flow information:
Cash paid during the year for interest................... $ 166 $ 16 $ 34
Debt issued for capital leased assets.................... -- -- 677
</TABLE>

See accompanying notes.

F-2-5
<PAGE>
M & P UTILITIES, INC. AND
MULLER & PRIBYL UTILITIES, INC.

NOTES TO COMBINED FINANCIAL STATEMENTS

(AMOUNTS IN THOUSANDS)
PERIOD FROM JANUARY 1, 1999 TO DECEMBER 21, 1999
AND FOR THE YEARS ENDED DECEMBER 31, 1998 AND 1997

1. BASIS OF PRESENTATION AND DESCRIPTION OF BUSINESS

The accompanying financial statements represent the combined financial
statements of M&P Utilities, Inc. and Muller & Pribyl Utilities, Inc.
(collectively, the Company). The Company is located in Hamel, Minnesota, and it
provides network infrastructure installation services to telecommunications,
Internet, cable TV providers and, to a lesser extent, energy companies. These
services are provided in various states in the upper midwest. Services are
performed primarily under fixed-price per unit produced contracts.

The financial statements of M&P Utilities, Inc. and Muller & Pribyl, Inc.
have been presented on a combined basis due to common stockholder control. All
significant intercompany balances and transactions have been eliminated.

2. SIGNIFICANT ACCOUNTING POLICIES

INVENTORIES

Inventories, consisting of raw materials and supplies, are stated at the
lower of cost, determined using the first in, first out method, or market.

FIXED ASSETS

Fixed assets are stated at cost, less accumulated depreciation. Equipment
recorded under capital leases is stated at the present value of the minimum
lease payments at the inception of the lease. Depreciation is calculated using
the straight-line method over the estimated service life of seven years, except
for building improvements and equipment under capital leases, which are
amortized over the shorter of the lease term or related asset life. Amortization
of assets recorded under capital leases is included in depreciation expense.

Maintenance, repairs, and renewals, which neither materially add to the
value of the property nor appreciably prolong its life, are charged to expense
as incurred. Gains or losses on disposition of property equipment are included
in income.

REVENUE AND COST RECOGNITION

The Company recognizes revenue based on the percentage-of-completion units
produced accounting method. Accordingly, revenue from services provided to
customers is reported as earned as measured by the completion of units produced
under the contract. Billings are prepared according to specific terms of
individual contracts. Contracts generally provide for periodic payments as work
is completed with final amounts due upon completion and acceptance of the
project by the customer. Unbilled revenues represent amounts earned and
recognized in the period for which billings are issued in the following period.

F-2-6
<PAGE>
M & P UTILITIES, INC. AND
MULLER & PRIBYL UTILITIES, INC.

NOTES TO COMBINED FINANCIAL STATEMENTS (CONTINUED)

2. SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
SIGNIFICANT CUSTOMERS

One customer accounted for approximately 12% of the Company's accounts
receivable balance at December 31, 1998 and three customers individually
accounted for greater than 10% of the Company's accounts receivable,
representing 32%, 21% and 12% of accounts receivable at December 21, 1999. For
the year ended December 31, 1997, three customers individually accounted for
greater than 10% of the Company's revenues, representing 19%, 11% and 10% of the
Company's revenues. For the years ended December 31, 1998 and 1997, one customer
accounted for approximately 18% and 21% of the Company's revenues, respectively.

INCOME TAXES

CASH EQUIVALENTS

The Company considers all highly liquid investments with original maturities
of three months or less to be cash equivalents.

CONCENTRATION OF CREDIT RISK

The Company maintains cash and cash equivalents with a financial
institution. At times, such amounts exceed the FDIC insured limits. The Company
limits the amount of credit exposure with one financial institution, and
management believes that no significant concentration of credit risk exists with
respect to cash investments.

USE OF ESTIMATES

F-2-7
<PAGE>
M & P UTILITIES, INC. AND
MULLER & PRIBYL UTILITIES, INC.

NOTES TO COMBINED FINANCIAL STATEMENTS (CONTINUED)

3. FIXED ASSETS

Fixed assets at cost consists of:

<TABLE>
<CAPTION>
DECEMBER 31 DECEMBER 21
1998 1999
----------- -----------
<S> <C> <C>
Machinery and equipment.............................. $ 8,813 $10,604
Transportation equipment............................. 3,483 3,548
Office equipment..................................... 166 210
Tools................................................ 337 368
Building improvements................................ 8 9
------- -------
12,807 14,739
Less: Accumulated depreciation....................... 6,479 8,023
------- -------
$ 6,328 $ 6,716
======= =======
</TABLE>

4. INDEBTEDNESS

The Company has two revolving credit agreements which allow for borrowings
in aggregate of the lesser of $4,500 or 80% of eligible accounts receivable and
inventory. The amount available at December 21, 1999, was limited to
approximately $4,500. Borrowings under the credit agreements bear interest at
the lender's prime rate, which was 8.5% at December 21, 1999, plus .5%. The
credit agreements will expire and any outstanding borrowings will mature on
March 31, 2000. No amounts were outstanding at December 21, 1999. Borrowings
under the credit agreements are secured by the Company's assets and are also
guaranteed by the Company's stockholders. The Company is also subject to certain
financial covenants including minimum net worth amounts, cash flow coverage, and
debt to worth ratios.

The note payable in the amount of $98,977 at December 21, 1999, is due
July 21, 2000 and is secured by equipment.

5. LEASES AND RELATED PARTY TRANSACTIONS

CAPITAL LEASES

The Company leases vehicles through capital leases. Vehicles recorded under
capital leases included within net fixed assets was $584 at December 21, 1999.

F-2-8
<PAGE>
M & P UTILITIES, INC. AND
MULLER & PRIBYL UTILITIES, INC.

NOTES TO COMBINED FINANCIAL STATEMENTS (CONTINUED)

5. LEASES AND RELATED PARTY TRANSACTIONS (CONTINUED)

Future minimum lease payments under capital leases at December 21, 1999,
together with the present value of the minimum lease payments are as follows:

<TABLE>
<S> <C>
2000........................................................ $ 168
2001........................................................ 168
2002........................................................ 163
2003........................................................ 126
2004........................................................ 31
2005 and thereafter......................................... --
-----
Total minimum payments...................................... 656
Less: Amounts representing interest......................... (72)
-----
Present value of minimum payments........................... 584
Less: Current portion (121)
-----
Total long-term portion $ 463
=====
</TABLE>

OPERATING LEASES

The Company's office and shop facility is owned by its stockholders who were
paid $4 per month for its use during 1997, 1998, and 1999. In addition, the
Company pays for real estate taxes, insurance, and costs.

6. LEGAL PROCEEDINGS

The Company is subject to various claims, including workers' compensation
and property damage claims, arising in the ordinary course of business, and is
party to various legal proceedings which are routine, and incidental to the
Company's business. In the opinion of management, all such matters are either
adequately covered by insurance, reserved for, or are not expected to have a
material adverse effect on the Company.

7. DEFINED-CONTRIBUTION PLAN

The Company maintains a defined-contribution 401(k) plan covering
substantially all of its nonunion employees. The plan provides for a
discretionary employer profit-sharing contribution. The Company contributed $20,
$41, and $52 to the plan for the years ending December 31, 1997 and 1998, and
December 21, 1999, respectively.

8. SUBSEQUENT EVENT

On December 21, 1999, the Company was acquired by Linc.net Inc. The Company
expensed approximately $4,485 in costs directly associated with the transaction,
of which approximately $2,200 related to employee bonuses that were contingent
upon closing.

F-2-9
<PAGE>
REPORT OF INDEPENDENT AUDITORS

The Board of Directors

Capital Land Services, Inc.

We have audited the accompanying balance sheets of Capital Land Services,
Inc. as of December 31, 1998 and October 19, 1999, and the related statements of
operations and retained earnings and cash flows for the years ended December 31,
1997 and 1998 and for the period from January 1, 1999 to October 19, 1999. These
financial statements are the responsibility of the Company's management. Our
responsibility is to express an opinion on these financial statements based on
our audits.

We conducted our audits in accordance with auditing standards generally
accepted in the United States. Those standards require that we plan and perform
the audit to obtain reasonable assurance about whether the financial statements
are free of material misstatement. An audit includes examining, on a test basis,
evidence supporting the amounts and disclosures in the financial statements. An
audit also includes assessing the accounting principles used and significant
estimates made by management, as well as evaluating the overall financial
statement presentation. We believe that our audits provide a reasonable basis
for our opinion.

In our opinion, the financial statements referred to above present fairly,
in all material respects, the financial position of Capital Land Services, Inc.
at December 31, 1998 and October 19, 1999, and the results of its operations and
its cash flows for the year ended December 31, 1997 and 1998 and for the period
from January 1, 1999 to October 19, 1999, in conformity with accounting
principles generally accepted in the United States.

ERNST & YOUNG LLP

Chicago, Illinois

August 25, 2000

F-3-1
<PAGE>
CAPITAL LAND SERVICES, INC.

BALANCE SHEETS

(AMOUNTS IN THOUSANDS, EXCEPT SHARE AND PER SHARE DATA)

<TABLE>
<CAPTION>
DECEMBER 31, OCTOBER 19,
1998 1999
------------- ------------
<S> <C> <C>
ASSETS
Current assets:
Cash and cash equivalents................................. $ 520 $ 151
Accounts receivable, less allowance of $191 and $241...... 1,711 1,625
Cost and estimated earnings in excess of billings on
uncompleted contracts................................... 621 1,197
Prepaid and other current assets.......................... 51 48
------ ------
Total current assets........................................ 2,903 3,021

Fixed assets, net........................................... 165 114
Other noncurrent assets..................................... 4 12
------ ------
$3,072 $3,147
====== ======
LIABILITIES AND STOCKHOLDER'S EQUITY
Current liabilities:
Accounts payable.......................................... $ 142 $ 14
Accrued expenses.......................................... 461 2,604
Deferred income taxes..................................... 13 3
------ ------
Total current liabilities................................... 616 2,621

Stockholder's equity:
Common stock, $1 par value, 25,000 shares authorized; 500
shares issued and outstanding........................... -- --
Additional paid-in capital................................ 4 4
Retained earnings......................................... 2,452 522
------ ------
Total stockholder's equity.................................. 2,456 526
------ ------
$3,072 $3,147
====== ======
</TABLE>

See accompanying notes to financial statements.

F-3-2
<PAGE>
CAPITAL LAND SERVICES, INC.

STATEMENTS OF OPERATIONS AND RETAINED EARNINGS

(AMOUNTS IN THOUSANDS)

<TABLE>
<CAPTION>
PERIOD
FROM
JANUARY 1,
YEARS ENDED 1999 TO
DECEMBER 31, OCTOBER 19,
------------------- -----------
1997 1998 1999
-------- -------- -----------
<S> <C> <C> <C>
Net revenues................................................ $ 13,637 $ 9,354 $ 7,137
Costs of sales.............................................. 9,114 6,557 5,390
-------- ------- -------
Gross profit................................................ 4,523 2,797 1,747

General and administrative.................................. 2,366 1,291 954
-------- ------- -------
Operating income............................................ 2,157 1,506 793

Other income (expense):
Interest income........................................... 34 25 --
Interest expense.......................................... (5) (2) --
Transaction costs related to sale of company.............. -- -- (2,259)
Other (expense) income.................................... (15) -- 17
-------- ------- -------
14 23 (2,242)
-------- ------- -------
Income (loss) before income taxes........................... 2,171 1,529 (1,449)
Income taxes................................................ 118 68 16
-------- ------- -------
Net income (loss)........................................... 2,053 1,461 (1,465)
Retained earnings, beginning of year........................ 3,477 2,523 2,452
Distributions to stockholder................................ (3,007) (1,532) (465)
-------- ------- -------
Retained earnings, end of year.............................. $ 2,523 $ 2,452 $ 522
======== ======= =======
</TABLE>

See accompanying notes to financial statements.

F-3-3
<PAGE>
CAPITAL LAND SERVICES, INC.

STATEMENTS OF CASH FLOWS

(AMOUNTS IN THOUSANDS)

<TABLE>
<CAPTION>
PERIOD
FROM
YEARS ENDED JANUARY 1,
DECEMBER 31, 1999 TO
------------------- OCTOBER 19,
1997 1998 1999
-------- -------- -----------
<S> <C> <C> <C>
OPERATING ACTIVITIES
Net income (loss)........................................... $ 2,053 $ 1,461 $(1,466)
Adjustments to reconcile net income (loss) to net cash
provided by operating activities:
Depreciation and amortization........................... 83 84 73
Provision for bad debts................................. 74 117 50
Deferred income taxes................................... -- (5) (9)
Changes in operating assets and liabilities:
Accounts receivable................................... 1,056 (359) 35
Costs and estimated earnings in excess of billings on
uncompleted contracts............................... (450) 433 (576)
Prepaids and other assets............................. 177 -- (5)
Accounts payable...................................... (112) 87 (128)
Accrued liabilities................................... (58) 252 2,143
------- ------- -------
Net cash providing by operating activities.................. 2,823 2,070 117

INVESTING ACTIVITIES
Purchases of equipment...................................... (131) (22) (21)
Proceeds received from related party note receivable........ 150 --
------- ------- -------
Net cash (used in) provided by investing activities......... (131) 128 (21)

FINANCING ACTIVITIES
Payment of amounts due to stockholder....................... (320) (240) --
Distributions to stockholder................................ (3,007) (1,532) (465)
------- ------- -------
Net cash used in financing activities....................... (3,327) (1,772) (465)
------- ------- -------
Net (decrease) increase in cash and cash equivalents........ (635) 426 (369)
Cash and cash equivalents, beginning of year................ 729 94 520
------- ------- -------
Cash and cash equivalents, end of period.................... $ 94 $ 520 $ 151
======= ======= =======
SUPPLEMENTAL DISCLOSURES
Cash paid for:
Interest.................................................. $ 5 $ 2 $ --
Income taxes.............................................. 16 102 66
</TABLE>

See accompanying notes to financial statements.

F-3-4
<PAGE>
CAPITAL LAND SERVICES, INC.

NOTES TO FINANCIAL STATEMENTS

YEARS ENDED DECEMBER 31, 1997 AND 1998 AND
PERIOD FROM JANUARY 1, 1999 TO OCTOBER 19, 1999

(AMOUNTS IN THOUSANDS)

1. DESCRIPTION OF BUSINESS

Capital Land Services, Inc. (the Company) provides project management and
related services to the telecommunications industry throughout the United
States.

2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

REVENUE RECOGNITION

For time and material based contracts, the Company recognizes revenue when
services are performed. For other contracts, the Company recognizes revenue
using the percentage-of-completion method, measured by the ratio of costs
incurred to date to total estimated cost as applied to estimated total revenue.

Contract costs include all direct material and labor costs and those
indirect costs related to contract performance, such as indirect labor,
supplies, tools, repairs, and depreciation. Selling, general, and administrative
costs are charged to expense as incurred. Provisions for estimated total losses
on uncompleted contracts, if any, are made in the period in which such losses
become probable. Changes in job performance, job conditions, and estimated
profitability, including those arising from contract penalty provisions, and
final contract settlements may result in revisions to costs and income and are
recognized in the period in which such revisions are determined.

FIXED ASSETS

Fixed assets, consisting primarily of computer and office equipment, are
stated at cost and depreciated using the straight-line method based upon
estimated useful lives which range from three to seven years.

ADVERTISING

The Company expenses the cost of advertising as incurred. The Company
incurred advertising costs of approximately $9, $28 and $27 for the years ended
December 31, 1997 and 1998 and for the period from January 1, 1999 to
October 19, 1999, respectively.

INCOME TAXES

For income tax purposes, the Company has elected to be treated as an
S Corporation under the applicable sections of the Internal Revenue Code and
various state laws as allowed. Accordingly, there are no provisions for federal
and certain state income taxes and, as such, income of the Company is included
in the taxable income of the stockholder. The provision for income taxes
includes state income taxes which are due regardless of the Company's elected
tax status. Differences between accounting rules and state tax laws cause
differences between the basis of certain assets and liabilities for financial
reporting and tax purposes. The tax effect of these differences is recorded as
deferred income tax assets and liabilities.

USE OF ESTIMATES

F-3-5
<PAGE>
CAPITAL LAND SERVICES, INC.

NOTES TO FINANCIAL STATEMENTS (CONTINUED)

YEARS ENDED DECEMBER 31, 1997 AND 1998 AND
PERIOD FROM JANUARY 1, 1999 TO OCTOBER 19, 1999

(AMOUNTS IN THOUSANDS)

2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
CONCENTRATION OF CREDIT RISK

The Company maintains cash and cash equivalents with a financial
institution. Cash equivalents include investments in financial instruments with
high credit ratings including securities backed by the United States government.
At times, such amounts exceed the FDIC limits. The Company limits the amount of
credit exposure with these financial institutions and believes that no
significant concentration of credit risk exists with respect to cash
investments.

At December 31, 1997, two customers accounted for 55% and 36% of accounts
receivable and for the year ended December 31, 1997, three customers accounted
for 63%, 10% and 10% of revenues. At December 31, 1998, two customers accounted
for 48% and 43% of accounts receivable and for the year ended December 31, 1998,
three customers accounted for 54%, 18% and 15% of revenues. At October 19, 1999,
two customers accounted for 53% and 27% of accounts receivable and for the
period from January 1, 1999 to October 19, 1999, three customers accounted for
40%, 31% and 16% of revenues.

CASH AND CASH EQUIVALENTS

The Company considers all highly liquid investments purchased with an
original maturity of three months or less to be cash equivalents.

3. FIXED ASSETS

Fixed assets consist of the following:

<TABLE>
<CAPTION>
DECEMBER 31, OCTOBER 19,
1998 1999
------------- ------------
<S> <C> <C>
Computers and software............................... $ 250 $ 263
Office furniture and fixtures........................ 58 58
Equipment............................................ 84 92
----- -----
392 413
Less: Accumulated depreciation....................... (227) (299)
----- -----
Fixed assets, net.................................... $ 165 $ 114
===== =====
</TABLE>

F-3-6
<PAGE>
CAPITAL LAND SERVICES, INC.

NOTES TO FINANCIAL STATEMENTS (CONTINUED)

(AMOUNTS IN THOUSANDS)

4. ACCRUED EXPENSES

Accrued expenses consist of the following:

<TABLE>
<CAPTION>
DECEMBER 31, OCTOBER 19,
1998 1999
------------- ------------
<S> <C> <C>
Salaries, wages, and employee benefits............... $379 $2,584
State income taxes and franchise taxes............... 73 7
Other................................................ 9 13
---- ------
$461 $2,604
==== ======
</TABLE>

5. NOTE PAYABLE TO STOCKHOLDER

In December 1997, the Company borrowed $240 from the sole stockholder and
president of the Company. The note bore interest at 7% per annum and was repaid
with interest of $2 in 1998.

6. COMMITMENTS

The Company leases office space and office equipment under noncancelable
operating leases which expire in the year 2000. The future aggregate minimum
rental payments under these operating leases are as follows:

<TABLE>
<S> <C>
Remainder of 1999........................................... $ 27
2000........................................................ 77
2001........................................................ 16
2002........................................................ 14
----
$134
====
</TABLE>

Rent expense was $112, $94 and $87 for the years ended December 31, 1997 and
1998 and for the period from January 1, 1999 to October 19, 1999, respectively.

7. INCOME TAXES

The provision for income taxes consists of the following:

<TABLE>
<CAPTION>
DECEMBER 31,
---------------------- OCTOBER 19,
1997 1998 1999
-------- -------- -----------
<S> <C> <C> <C>
Current............................................. $118 $73 $ 25
Deferred............................................ -- (5) (9)
---- --- ----
$118 $68 $ 16
==== === ====
</TABLE>

The principal items giving rise to deferred income taxes relate to the
timing differences in the recognition of income and expenses for income tax and
financial reporting purposes resulting from the Company's policy of reporting on
the cash basis for income tax purposes and the accrual basis for financial
reporting purposes.

F-3-7
<PAGE>
CAPITAL LAND SERVICES, INC.

NOTES TO FINANCIAL STATEMENTS (CONTINUED)

(AMOUNTS IN THOUSANDS)

8. RELATED PARTY TRANSACTIONS

The Company leases office space from its sole stockholder and president and
recorded rent expense of $21 for this space for both the years ended
December 31, 1997 and 1998 and the period from January 1, 1999 to October 19,
1999.

At December 31, 1998, the Company had a 25% ownership interest in Elkins
Telecommunications (Elkins), which had no carrying value for financial reporting
purposes. The Company's ownership interest in Elkins was subsequently sold for
nominal consideration in January 1999.

During 1998, the Company engaged Elkins to provide contract labor and at
December 31, 1998, had an amount payable to Elkins of approximately $85, net of
approximately $42 due from Elkins for services provided to Elkins. During 1999,
the Company was no longer engaged with Elkins for contract labor, and as such,
there were no amounts due to or from Elkins at October 19, 1999.

9. DEFINED-CONTRIBUTION PLAN

The Company maintains a defined-contribution 401(k) plan covering
substantially all employees. The Plan provides for a discretionary employer
profit-sharing contribution. The Company did not make any contributions for the
years ended December 31, 1997 and 1998 or for the period from January 1, 1999 to
October 19, 1999.

10. SUBSEQUENT EVENT

On October 19, 1999, the Company's stockholder and Linc.net Inc. entered
into a stock purchase agreement whereby Linc.net Inc. acquired all of the
outstanding capital stock of the Company at an aggregate purchase price of
approximately $15.7 million. The Company expensed approximately $2.3 million in
costs directly associated with the transaction, of which approximately
$2.2 million related to employee bonuses that were contingent upon closing.

F-3-8
<PAGE>
REPORT OF INDEPENDENT AUDITORS

Partners

C & B Associates, Ltd. and C & B Associates II, Ltd.

We have audited the accompanying combined balance sheet of C & B
Associates, Ltd. and C & B Associates II, Ltd. (the Company) as of December 21,
1999, and the related combined statement of income, partnerships' equity, and
cash flows for the period from January 1, 1999 to December 21, 1999. These
financial statements are the responsibility of the Company's management. Our
responsibility is to express an opinion on these financial statements based on
our audit.

We conducted our audit in accordance with auditing standards generally
accepted in the United States. Those standards require that we plan and perform
our audit to obtain reasonable assurance about whether the financial statements
are free of material misstatement. An audit includes examining, on a test basis,
evidence supporting the amounts and disclosures in the financial statements. An
audit also includes assessing the accounting principles used and significant
estimates made by management, as well as evaluating the overall financial
statement presentation. We believe that our audit provides a reasonable basis
for our opinion.

In our opinion, the combined financial statements referred to above present
fairly, in all material respects, the combined financial position of the Company
at December 21, 1999, and the combined results of its operations and its cash
flows for the period from January 1, 1999 to December 21, 1999, in conformity
with accounting principles generally accepted in the United States.

ERNST & YOUNG LLP

Chicago, Illinois
July 25, 2000

F-4-1
<PAGE>
C & B ASSOCIATES, LTD. AND
C & B ASSOCIATES II, LTD.

COMBINED BALANCE SHEET

DECEMBER 21, 1999

(AMOUNTS IN THOUSANDS)

<TABLE>
<S> <C>
ASSETS
Current assets:
Cash and cash equivalents................................. $ 2,064
Accounts receivable, including retainage of $1,843........ 6,665
Costs and estimated earnings in excess of billings on
uncompleted contracts................................... 157
Inventory................................................. 230
Prepaid expenses and other current assets................. 496
-------
Total current assets........................................ 9,612

Fixed assets, net........................................... 3,490
-------
Total assets................................................ $13,102
=======
LIABILITIES AND PARTNERSHIPS' EQUITY
Current liabilities:
Accounts payable.......................................... $ 2,602
Accrued expenses.......................................... 217
Billing in excess of cost and estimated earnings on
uncompleted contracts................................... 156
Current portion of notes payable.......................... 1,490
-------
Total current liabilities................................... 4,465
Notes payable, less current portion......................... 1,324

Partnerships' equity:
Partner contributions..................................... 331
Retained earnings......................................... 6,987
Accumulated other comprehensive income.................... (5)
-------
Total partnerships' equity.................................. 7,313
-------
Total liabilities and partnerships' equity.................. $13,102
=======
</TABLE>

See accompanying notes.

F-4-2
<PAGE>
C & B ASSOCIATES, LTD. AND

C & B ASSOCIATES II, LTD.

COMBINED STATEMENT OF INCOME

PERIOD FROM JANUARY 1, 1999 TO DECEMBER 21, 1999

(AMOUNTS IN THOUSANDS)

<TABLE>
<S> <C>
Net revenue................................................. $31,964
Costs of sales.............................................. 23,409
-------
Gross profit................................................ 8,555
General and administrative expenses......................... 3,180
-------
Income from operations...................................... 5,375
Other income and (expense):
Interest income........................................... 85
Interest expense.......................................... (241)
Transaction costs related to sale of company.............. (956)
Other income.............................................. 110
-------
Total other expense, net.................................... (1,002)
-------
Income before state income taxes............................ 4,373
State income taxes.......................................... 145
-------
Net income.................................................. $ 4,228
=======
</TABLE>

See accompanying notes.

F-4-3
<PAGE>
C & B ASSOCIATES, LTD. AND

C & B ASSOCIATES II, LTD.

COMBINED STATEMENT OF PARTNERSHIPS' EQUITY

DECEMBER 21, 1999

(AMOUNTS IN THOUSANDS)

<TABLE>
<CAPTION>
ACCUMULATED
OTHER
PAID-IN RETAINED COMPREHENSIVE
CAPITAL EARNINGS INCOME TOTAL
-------- -------- ------------- --------
<S> <C> <C> <C> <C>
Balance at December 31, 1998.......................... $331 $ 6,323 $(3) $ 6,651
Net income............................................ -- 4,228 -- 4,228
Net unrealized loss on securities..................... -- -- (2) (2)
-------
Comprehensive Income.................................. 4,226
Distributions to partners............................. -- (3,564) -- (3,564)
---- ------- --- -------
Balance at December 21, 1999.......................... $331 $ 6,987 $(5) $ 7,313
==== ======= === =======
</TABLE>

See accompanying notes.

F-4-4
<PAGE>
C & B ASSOCIATES, LTD. AND

C & B ASSOCIATES II, LTD.

COMBINED STATEMENT OF CASH FLOWS

PERIOD FROM JANUARY 1, 1999 TO DECEMBER 21, 1999

(AMOUNTS IN THOUSANDS)

<TABLE>
<S> <C>
CASH FLOWS FROM OPERATING ACTIVITIES
Net income.................................................. $ 4,228
Adjustments to reconcile net income to net cash provided by
operating activities:
Depreciation.............................................. 1,170
Provision for doubtful accounts........................... 69
Changes in operating assets and liabilities:
(Increase) decrease in operating assets:
Accounts receivable................................... 200
Costs and estimated earnings in excess of billings
uncompleted contracts................................ 119
Inventory............................................. 673
Prepaid expenses and other current assets............. (300)
Increase (decrease) in operating liabilities:
Accounts payable...................................... 69
Accrued expenses...................................... (117)
Billings in excess of cost and estimated earnings on
uncompleted contracts................................ (932)
-------
Net cash provided by operating activities................... 5,179

CASH FLOWS FROM INVESTING ACTIVITIES
Purchase of fixed assets.................................... (2,154)
Proceeds from sale of marketable securities................. 504
-------
Cash used in investing activities........................... (1,650)

CASH FLOWS FROM FINANCING ACTIVITIES
Principal payments on debt.................................. (1,917)
Proceeds from issuance debt................................. 1,149
Distributions to partners................................... (1,976)
-------
Net cash used in financing activities....................... (2,744)
-------
Increase in cash and cash equivalents....................... 785
Cash and cash equivalents at beginning of year.............. 1,279
-------
Cash and cash equivalents at end of year.................... $ 2,064
=======
NON-CASH ACTIVITY
Distribution to partners.................................... $ 1,588

SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION
Cash paid during the year for:
Interest................................................ $ 256
Income taxes............................................ 49
</TABLE>

See accompanying notes.

F-4-5
<PAGE>
C & B ASSOCIATES, LTD. AND

C & B ASSOCIATES II, LTD.

NOTES TO COMBINED FINANCIAL STATEMENTS

PERIOD FROM JANUARY 1, 1999 TO DECEMBER 21, 1999

(AMOUNTS IN THOUSANDS)

1. BASIS OF PRESENTATION AND DESCRIPTION OF BUSINESS

The accompanying financial statements represent the combined financial
statements of C & B Associates, Ltd. and C & B Associates, II Ltd.
(collectively, the Company). C & B Associates, Ltd. was previously called C & B
Associates, Inc. The Company is located in Mineral Wells, Texas, and it provides
network installation services primarily to the telecommunications industry.

The financial statements of C&B Associates, Ltd. and C&B Associates, Inc.
have been presented on a combined basis due to common stockholder control. All
significant intercompany balances and transactions have been eliminated.

2. SIGNIFICANT ACCOUNTING POLICIES

INVENTORIES

Inventories are stated at the lower of cost, determined using the first in,
first out method, or market.

FIXED ASSETS

Fixed assets are stated at cost, less accumulated depreciation. Depreciation
is calculated using the straight-line method over the estimated useful life of
the assets. The useful lives of fixed assets are as follows: seven years for
machinery and equipment, five years for computer equipment, and the shorter of
the lease term or related asset life for building improvements.

REVENUE AND COST RECOGNITION

Revenues from fixed-price construction contracts are recognized using the
percentage-of-completion method of accounting with percentage of completion,
measured by the percentage of costs incurred to date to estimated total costs,
applied to estimated total revenue.

Contract costs include all direct material and labor costs and the indirect
costs related to contract performance, such as indirect labor, supplies, tools,
repair, and depreciation costs. General and administrative costs are charged to
expense as incurred. Provisions for total estimated losses on uncompleted
contracts are made in the period in which it becomes probable that a loss will
be incurred on the contract. Changes in job performance, job conditions, and
estimated profitability, including those arising from contract penalty
provisions, and final contract settlements may result in revisions to costs and
revenues and are recognized in the period in which the revisions are determined.

SIGNIFICANT CUSTOMERS

Four customers accounted for approximately 52%, 22%, 16%, and 5% of the
Company's accounts receivable balance at December 21, 1999. For the period ended
December 21, 1999, five customers accounted for approximately 24%, 24%, 20%,
14%, and 11% of the Company's revenues.

F-4-6
<PAGE>
C & B ASSOCIATES, LTD. AND

C & B ASSOCIATES II, LTD.

NOTES TO COMBINED FINANCIAL STATEMENTS (CONTINUED)

PERIOD FROM JANUARY 1, 1999 TO DECEMBER 21, 1999

(AMOUNTS IN THOUSANDS)

2. SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
INCOME TAXES

Concurrent with C&B Associates, Ltd. name change, the Company changed its
tax status from an S-corporation to a partnership. Accordingly, there are no
provisions for federal and certain state income taxes and as such, income of the
Company is included in the taxable income of the partners. The provision for
income taxes includes state income taxes which are due regardless of the
Company's elected tax status.

CASH EQUIVALENTS

The Company considers all highly liquid investments with original maturities
of three months or less to be cash equivalents.

CONCENTRATION OF CREDIT RISK

USE OF ESTIMATES

3. FIXED ASSETS

Fixed assets consist of the following as of December 21, 1999:

<TABLE>
<S> <C>
Building.................................................... $ 7
Machinery and equipment..................................... 9,099
Building improvements....................................... 54
-------
9,160
Less: Accumulated depreciation.............................. (5,670)
-------
$ 3,490
=======
</TABLE>

F-4-7
<PAGE>
C & B ASSOCIATES, LTD. AND

C & B ASSOCIATES II, LTD.

NOTES TO COMBINED FINANCIAL STATEMENTS (CONTINUED)

PERIOD FROM JANUARY 1, 1999 TO DECEMBER 21, 1999

(AMOUNTS IN THOUSANDS)

4. COSTS AND ESTIMATED EARNINGS ON UNCOMPLETED CONTRACTS

<TABLE>
<S> <C>
Cost incurred on uncompleted contracts...................... $13,258
Estimated earnings.......................................... 3,725
-------
16,983
Less: billings to date...................................... 16,982
-------
$ 1
=======
</TABLE>

The foregoing balance is included in the accompanying balance sheet under
the following captions:

<TABLE>
<S> <C>
Costs and estimated earnings in excess of billings on
uncompleted contracts..................................... $ 157
Billings in excess of costs and estimated earnings on
uncompleted contracts..................................... (156)
-----
$ 1
=====
</TABLE>

5. DEBT

The Company's debt consists of the following at December 21, 1999:

<TABLE>
<S> <C>
Note due June 30, 2000, bearing interest at 8.5%, payable in
monthly installments of $20, plus interest. Original note
was $250 increased at various times for subsequent
equipment purchases....................................... $ 117
Term note due August 31, 2001, bearing interest at 8.5%,
payable in monthly installments of $42, plus interest..... 890
Note due October 30, 2002, bearing interest at 8.5%, payable
in monthly installments of $1, plus interest.............. 36
Term note due march 25, 2003, bearing interest at 8.5%,
payable in monthly installments of $1, plus interest...... 43
Term note due June 3, 2004, bearing interest at 8.5%,
payable in monthly installments of $1, plus interest...... 53
Term note due June 30, 2003, bearing interest at 8.5%,
payable in monthly installments of $29, plus interest. The
note has a revolving feature which allows the borrower to
borrow up to $1,427. The unused credit available at
December 21, 1999 was $178................................ 1,249
Term note due June 30, 2004, bearing interest at 8.5%,
payable in monthly installments of $31, plus interest. The
note has a revolving feature which allows the borrower to
borrow up to $1,500. The unused credit available at
December 21, 1999 was $1,074.............................. 426
-------
2,814
Less: current maturities.................................... (1,490)
-------
$ 1,324
=======
</TABLE>

F-4-8
<PAGE>
C & B ASSOCIATES, LTD. AND

C & B ASSOCIATES II, LTD.

NOTES TO COMBINED FINANCIAL STATEMENTS (CONTINUED)

PERIOD FROM JANUARY 1, 1999 TO DECEMBER 21, 1999

(AMOUNTS IN THOUSANDS)

5. DEBT (CONTINUED)
All of the notes payable are secured by the equipment of the Company and are
covered by a loan agreement dated August 29, 1997, as amended. The loans are
guaranteed by the principal partners, with the loan agreement providing for
maintaining certain levels of working capital, current ratios, tangible net
worth, liabilities to tangible net worth ratios, cash flow coverage ratios, cash
flow coverage and liquidity levels. In addition, the loan agreement restricts:
capital expenditures, dividends and distributions to partners in excess of $250
or an amount sufficient for the partners to pay income taxes on their share of
profits and substantial management personnel changes.

Aggregate maturities of debt at December 21, 1999 are as follows:

<TABLE>
<S> <C>
Year ended December 31:
2000........................................................ 1,490
2001........................................................ 733
2002........................................................ 392
2003........................................................ 193
Thereafter.................................................. 6
------
$2,814
======
</TABLE>

Interest expense for the period from January 1, 1999 to December 21, 1999
was $241.

6. OPERATING LEASES

The Company leases equipment under operating leases that expire through
2001. Future minimum lease payments required under these leases are $473 and $8
for 2000 and 2001, respectively. Rent expense for the period from January 1,
1999 to December 21, 1999 was $751.

7. LEGAL PROCEEDINGS

8. DEFINED-CONTRIBUTION PLAN

The Company maintains a defined-contribution 401(k) plan covering
substantially all of its nonunion employees. The plan provides for a
discretionary employer profit-sharing contribution. The Company contributed $96
to the plan for the period from January 1, 1999 to December 21, 1999.

F-4-9
<PAGE>
C & B ASSOCIATES, LTD. AND

C & B ASSOCIATES II, LTD.

NOTES TO COMBINED FINANCIAL STATEMENTS (CONTINUED)

PERIOD FROM JANUARY 1, 1999 TO DECEMBER 21, 1999

(AMOUNTS IN THOUSANDS)

9. INCOME TAXES

The provision for income taxes differs from the amount of income tax
determined by applying the applicable U.S. statutory federal income tax rate to
pretax income for the period from January 1, 1999 to December 21, 1999,
primarily as a result of the Company being taxed as a partnership which results
in the flow-through of the Company's pretax profits to the partners' personal
tax returns for federal tax purposes.

10. SUBSEQUENT EVENT

On December 21, 1999, the Company's partners and Linc.net Inc. entered into
a stock purchase agreement whereby Linc.net Inc. acquired all of the outstanding
units of the Company at an aggregate purchase price of approximately
$36.2 million, net of cash acquired. The Company expensed approximately $956 in
legal, accounting and contingent closing bonuses directly associated with the
transaction for the period from January 1, 1999 to December 21, 1999.

F-4-10
<PAGE>
REPORT OF INDEPENDENT AUDITORS

The Board of Directors and Stockholders of
C & B Associates, Inc. and C & B Associates II, Ltd.

We have audited the accompanying combined balance sheets of C & B
Associates, Inc. and C & B Associates II, Ltd. (the Company) as of December 31,
1997 and 1998, and the related combined statements of income, stockholders'
equity, and cash flows for the years then ended. These financial statements are
the responsibility of the Company's management. Our responsibility is to express
an opinion on these financial statements based on our audits.

We conducted our audits in accordance with auditing standards generally
accepted in the United States. Those standards require that we plan and perform
our audits to obtain reasonable assurance about whether the financial statements
are free of material misstatement. An audit includes examining, on a test basis,
evidence supporting the amounts and disclosures in the financial statements. An
audit also includes assessing the accounting principles used and significant
estimates made by management, as well as evaluating the overall financial
statement presentation. We believe that our audits provide a reasonable basis
for our opinion.

In our opinion, the combined financial statements referred to above present
fairly, in all material respects, the combined financial position of the Company
at December 31, 1997 and 1998, and the combined results of its operations and
its cash flows for the years then ended, in conformity with accounting
principles generally accepted in the United States.

CRAWFORD, CARTER, THOMPSON & BARRON, L.L.P.

August 10, 2000

F-4-11
<PAGE>
C & B ASSOCIATES, INC. AND
C & B ASSOCIATES II, LTD.

COMBINED BALANCE SHEETS

(AMOUNT IN THOUSANDS)

<TABLE>
<CAPTION>
DECEMBER 31
1997 1998
-------- --------
<S> <C> <C>
ASSETS
Current assets:
Cash and cash equivalents................................. $ 2,604 $ 1,279
Accounts receivable, including retainage of $1,190 and
$1,689 at December 31, 1997 and 1998, respectively...... 5,404 6,934
Marketable securities..................................... -- 504
Cost and estimated earnings in excess of billing on
uncompleted contracts................................... 987 276
Inventory................................................. 66 903
Prepaid expenses and other current assets................. 203 196
------- -------
Total current assets........................................ 9,264 10,092
Fixed assets, net........................................... 3,118 4,121
Other non-current assets.................................... 81 81
------- -------
Total assets................................................ $12,463 $14,294
======= =======

LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable.......................................... $ 902 $ 2,533
Accrued expenses.......................................... 296 206
Billing in excess of cost and estimated earnings on
uncompleted contracts................................... 269 1,088
Current portion of notes payable.......................... 2,194 2,570
Other payable............................................. 95 126
------- -------
Total current liabilities................................... 3,756 6,523
Long-term liabilities:
Notes payable, less current portion....................... 907 1,120
Stockholders' equity
Partner contributions..................................... 460 460
Additional paid-in-capital................................ 24 24
Treasury stock at cost.................................... (153) (153)
Retained earnings......................................... 7,469 6,323
Accumulated other comprehensive income.................... -- (3)
------- -------
Total stockholders' equity.................................. 7,800 6,651
------- -------
Total liabilities and stockholders' equity.................. $12,463 $14,294
======= =======
</TABLE>

See accompanying notes.

F-4-12
<PAGE>
C & B ASSOCIATES, INC. AND
C & B ASSOCIATES II, LTD.

COMBINED STATEMENTS OF INCOME

(AMOUNT IN THOUSANDS)

<TABLE>
<CAPTION>
YEARS ENDED
DECEMBER 31,
1997 1998
-------- --------
<S> <C> <C>
Revenue..................................................... $16,301 $22,292
Cost of sales............................................... 11,700 15,707
------- -------
Gross profit................................................ 4,601 6,585
General and administrative expenses......................... 2,090 4,238
------- -------
Income from operations...................................... 2,511 2,347

Other income and (expense):
Interest income........................................... 9 63
Interest expense.......................................... (303) (334)
Other income.............................................. 76 (68)
------- -------
Total other income, net..................................... (218) (339)
------- -------
Income before state income taxes............................ 2,293 2,008
Provision for state income taxes............................ 181 82
------- -------
Net income.................................................. $ 2,112 $ 1,926
======= =======
</TABLE>

See accompanying notes.

F-4-13
<PAGE>
C & B ASSOCIATES, INC. AND
C & B ASSOCIATES II, LTD.

COMBINED STATEMENTS OF STOCKHOLDERS' EQUITY

(AMOUNT IN THOUSANDS)

<TABLE>
<CAPTION>
COMMON ACCUMULATED
STOCK/ ADDITIONAL RETAINED/ OTHER
PARTNER PAID-IN TREASURY ACCUMULATED COMPREHENSIVE
INVESTMENT CAPITAL STOCK EARNINGS INCOME TOTAL
---------- ---------- -------- ----------- ------------- --------
<S> <C> <C> <C> <C> <C> <C>
Balance at December 31,
1996........................ $ 10 $24 $(153) $ 8,236 $ 39 $ 8,156
Net income.................... -- -- -- 2,112 -- 2,112
Net unrealized loss on
securities.................. -- -- -- -- (39) (39)
Contribution from partners.... 450 -- -- -- -- 450
Distributions to
stockholders................ -- -- -- (2,879) -- (2,879)
---- --- ----- ------- ---- -------
Balance at December 31,
1997........................ 460 24 (153) 7,469 -- 7,800
Net income.................... -- -- -- 1,926 -- 1,926
Net unrealized loss on
securities.................. -- -- -- -- (3) (3)
Distributions to
stockholders................ -- -- -- (3,072) -- (3,072)
---- --- ----- ------- ---- -------
Balance at December 31,
1998........................ $460 $24 $(153) $ 6,323 $ (3) $ 6,651
==== === ===== ======= ==== =======
</TABLE>

See accompanying notes.

F-4-14
<PAGE>
C & B ASSOCIATES, INC. AND

C & B ASSOCIATES II, LTD.

COMBINED STATEMENTS OF CASH FLOWS

(AMOUNT IN THOUSANDS)

<TABLE>
<CAPTION>
YEAR ENDED
DECEMBER 31,
1997 1998
-------- --------
<S> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES
Net income.................................................. $ 2,112 $ 1,926
Adjustments to reconcile net income to net cash provided by
operating activities:
Depreciation.............................................. 884 985
Changes in operating assets and liabilities:
Decrease (increase) in operating assets:
Accounts receivable and unbilled revenues............. (594) (819)
Inventory............................................. 277 (837)
Prepaid expenses and other current assets............. (2) 7
Increase (decrease) in operating liabilities:
Accounts payable...................................... (2,294) 1,631
Accrued expenses...................................... 58 759
------- -------
Net cash provided by operating activities................... 441 3,652
CASH FLOWS FROM INVESTING ACTIVITIES
Purchase of investments..................................... 2,097 (506)
Purchase of fixed assets.................................... (713) (1,988)
------- -------
Cash provided by (used by) investing activities............. 1,384 (2,494)

CASH FLOWS FROM FINANCING ACTIVITIES
Proceeds from borrowings.................................... 947 1,377
Principal payments on debt.................................. (883) (788)
Capital contribution from stockholders...................... 450
Distributions............................................... (2,879) (3,072)
------- -------
Net cash used in financing activities....................... (2,365) (2,483)
------- -------
Increase in cash and cash equivalents....................... (540) (1,325)
Cash and cash equivalents at beginning of year.............. 3,144 2,604
------- -------
Cash and cash equivalents at end of year.................... $ 2,604 $ 1,279
======= =======
Supplemental disclosures of cash flow information:
Cash paid during the year for:
Interest................................................ $ 291 $ 349
Income taxes............................................ 8 181
</TABLE>

See accompanying notes.

F-4-15
<PAGE>
C & B ASSOCIATES, INC. AND

C & B ASSOCIATES II, LTD.

NOTES TO COMBINED FINANCIAL STATEMENTS

YEARS ENDED DECEMBER 31, 1997 AND 1998

(AMOUNTS IN THOUSANDS)

1. BASIS OF PRESENTATION AND DESCRIPTION OF BUSINESS

The accompanying financial statements represent the combined financial
statements of C & B Associates, Inc. and C & B Associates II, Ltd.
(collectively, the Company). The Company is located in Mineral Wells, Texas, and
it provides network installation services primarily to the telecommunications
industry. The Company follows the cost to cost method of percentage of
completion accounting. The contracts typically state that payment will be based
on units installed or completed.

All significant intercompany balances and transactions have been eliminated.

2. SIGNIFICANT ACCOUNTING POLICIES

INVENTORIES

Inventories are stated at the lower of cost, determined using the first in,
first out method, or market.

FIXED ASSETS

Fixed assets are stated at cost, less accumulated depreciation. Depreciation
is calculated using the straight-line method over the estimated service life of
seven years, except for building improvements, which are amortized over the
shorter of the lease term or related asset life.

REVENUE AND COST RECOGNITION

SIGNIFICANT CUSTOMERS

One customer accounted for approximately 93% of the Company's accounts
receivable balance at December 31, 1998. For the year ended December 31, 1998,
one customer accounted for approximately 64% of the Company's revenues. Four
customers accounted for approximately 90% of Company's accounts receivable
balance at December 31, 1997. For the year ended December 31, 1997, two
customers accounted for approximately 66% of the Company's revenues.

F-4-16
<PAGE>
C & B ASSOCIATES, INC. AND

C & B ASSOCIATES II, LTD.

NOTES TO COMBINED FINANCIAL STATEMENTS (CONTINUED)

YEARS ENDED DECEMBER 31, 1997 AND 1998

(AMOUNTS IN THOUSANDS)

2. SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
INCOME TAXES

CASH EQUIVALENTS

The Company considers all highly liquid investments with original maturities
of three months or less to be cash equivalents.

CONCENTRATION OF CREDIT RISK

USE OF ESTIMATES

3. FIXED ASSETS

Fixed assets at cost consists of:

<TABLE>
<CAPTION>
DECEMBER 31
-----------------------
1997 1998
-------- --------
<S> <C> <C>
Buildings and land...................................... $ 221 $ 221
Machinery and equipment................................. 8,082 9,322
Leasehold improvements.................................. 181 901
------ -------
8,484 10,444
Less: Accumulated depreciation.......................... 5,366 6,323
------ -------
$3,118 $ 4,121
====== =======
</TABLE>

F-4-17
<PAGE>
C & B ASSOCIATES, INC. AND

C & B ASSOCIATES II, LTD.

NOTES TO COMBINED FINANCIAL STATEMENTS (CONTINUED)

YEARS ENDED DECEMBER 31, 1997 AND 1998

(AMOUNTS IN THOUSANDS)

4. UNCOMPLETED CONTRACTS

Information regarding uncompleted contracts are as follows:

<TABLE>
<CAPTION>
DECEMBER 31
1997 1998
-------- --------
<S> <C> <C>
Total adjusted contract price......................... $ 18,635 $ 24,206
======== ========
Cost incurred......................................... $ 12,548 $ 11,734
Earnings recognized................................... 3,452 3,302
-------- --------
Revenue earned........................................ 16,000 15,036
Less: Billings to date................................ (15,282) (15,848)
-------- --------
Net total............................................. $ 718 $ (812)
======== ========
</TABLE>

Included in the accompanying balance sheet under the following captions:

<TABLE>
<S> <C> <C>
Costs and estimated earnings in excess of billings on
uncompleted contracts............................... $ 987 $ 276
Billings in excess of costs and estimated earnings on
uncompleted contracts............................... (269) (1,088)
-------- --------
Net totals............................................ $ 718 $ (812)
======== ========
</TABLE>

F-4-18
<PAGE>
C & B ASSOCIATES, INC. AND

C & B ASSOCIATES II, LTD.

NOTES TO COMBINED FINANCIAL STATEMENTS (CONTINUED)

YEARS ENDED DECEMBER 31, 1997 AND 1998

(AMOUNTS IN THOUSANDS)

5. INDEBTEDNESS

Notes payable at December 31 consists of the following:

<TABLE>
<CAPTION>
1997 1998
-------- --------
<S> <C> <C>
Term notes due June 30, 1999, bearing interest at prime
(floating)................................................ $ 650 $1,815
Note due June 30, 2000, bearing interest at prime
(floating), payable in monthly installments of $19,545,
plus interest. Original note was $250,000 increased at
various times for subsequent equipment purchases.......... 587 352
Term note due August 31, 2001, bearing interest at prime
(floating), payable in monthly installments of $42,361,
plus interest. Original amount of note was $2,033,333
which consists of consolidation of various equipment
notes..................................................... 1,864 1,355
Note due October 30, 2002, bearing interest at prime
(floating), payable in monthly installments of $1,042 plus
interest. Original amount of note was $50,000 for purchase
of equipment.............................................. 48
Term note to stockholder due June 30, 2000, bearing no
interest.................................................. 120
------- ------
3,101 3,690
Less: Current maturities included in current liabilities.... (2,194) (2,570)
------- ------
$ 907 $1,120
======= ======
</TABLE>

All of the notes are secured by all of the equipment of the Company and are
covered by a loan agreement dated August 29, 1997, as amended. The loans are
guaranteed by the principal equity holders, with the loan agreement providing
for maintaining certain levels of working capital, current ratios, tangible net
worth, liabilities to tangible net worth ratios, cash flow coverage ratios, cash
flow coverage and liquidity levels. In addition, it restricts: capital
expenditures, dividends and distributions to equity holders in excess of
$250,000 or an amount sufficient for the stockholders/partners to pay income
taxes on their share of profits and substantial management personnel changes.

The following are maturities of notes payable for each of the next five
years.

<TABLE>
<CAPTION>
YEAR ENDED DECEMBER 31:
<S> <C>
1999........................................................ $2,570
2000........................................................ 758
2001........................................................ 351
2002........................................................ 11
2003........................................................
------
$3,690
======
</TABLE>

Interest expense for 1998 and 1997 was $334 and $303, respectively.

F-4-19
<PAGE>
C & B ASSOCIATES, INC. AND

C & B ASSOCIATES II, LTD.

NOTES TO COMBINED FINANCIAL STATEMENTS (CONTINUED)

YEARS ENDED DECEMBER 31, 1997 AND 1998

(AMOUNTS IN THOUSANDS)

6. RELATED PARTY TRANSACTIONS

One of the Company's offices and shop facility is owned by its
stockholders/partners who were paid $1 per month for its use during 1998 and
1997. In addition, the Company pays for real estate taxes, insurance, and other
costs related to operating the facilities.

7. LEGAL PROCEEDINGS

8. DEFINED-CONTRIBUTION PLAN

The Company maintains a defined-contribution plan covering substantially all
of its nonunion employees. The plan provides for a discretionary employer
profit-sharing contribution. The Company contributed $103 and $93 to the plan
for the year ending December 31, 1998 and 1997, respectively.

9. CONTINGENCIES

The Company provides a self-funded employee health insurance plan
administered by Diversified Group Administrators, Inc. The plan consists of a
policy with Continental Insurance Company with a stop loss of $8 per covered
individual after a nominal deductible is met. The Company is responsible for
medical claims of $8 per covered individual per calendar year. The overall loss
limitation at December 31, 1998 and 1997 was $1,140 and $862, respectively.

F-4-20
<PAGE>
C & B ASSOCIATES, INC. AND

C & B ASSOCIATES II, LTD.

NOTES TO COMBINED FINANCIAL STATEMENTS (CONTINUED)

YEARS ENDED DECEMBER 31, 1997 AND 1998

(AMOUNTS IN THOUSANDS)

10. MARKETABLE AND INVESTMENT SECURITIES

Carrying amounts and approximate market values of marketable and investment
securities are summarized as follows:

<TABLE>
<CAPTION>
DECEMBER 31, 1997
---------------------------------------------
GROSS GROSS
UNREALIZED UNREALIZED FAIR
COST GAINS LOSSES VALUE
-------- ---------- ---------- --------
<S> <C> <C> <C> <C>
Securities to be held to maturity
Municipal bond fund...................................... $ 80 $-- $(1) $ 79
==== === === ====
</TABLE>

<TABLE>
<CAPTION>
DECEMBER 31, 1998
---------------------------------------------
GROSS GROSS
UNREALIZED UNREALIZED FAIR
COST GAINS LOSSES VALUE
-------- ---------- ---------- --------
<S> <C> <C> <C> <C>
Securities to be held to maturity
Municipal bond fund...................................... $ 79 $-- ($1) $ 78
==== === === ====
Securities available for sale
Mutual funds............................................. $507 $-- $(3) $504
==== === === ====
</TABLE>

Investments to be held to maturity are carried as other non-current assets
and are Exempt Bond Funds, which contain municipal bonds having maturities
ranging from years 2003 through 2018.

11. OPERATING LEASES

The Company leases equipment under monthly operating leases. The leases have
various maturities ranging from June 2000 to February 2001. At the end of the
leases, the Company has the option of purchasing the equipment or returning it.
Lease expense for 1997 and 1998 was $309 and $823, respectively.

F-4-21
<PAGE>
REPORT OF INDEPENDENT AUDITORS

The Board of Directors and Stockholders of
North Shore Cable Contractors, Inc.

We have audited the accompanying balance sheets of North Shore Cable
Contractors, Inc. (the Company) as of December 31, 1998 and 1999, and the
related statements of operations, stockholders' equity (deficit), and cash flows
for each of the three years in the period ended December 31, 1999. These
financial statements are the responsibility of the Company's management. Our
responsibility is to express an opinion on these financial statements based on
our audits.

In our opinion, the financial statements referred to above present fairly,
in all material respects, the financial position of North Shore Cable
Contractors, Inc. at December 31, 1998 and 1999, and the results of its
operations and its cash flows for each of the three years in the period ended
December 31, 1999, in conformity with accounting principles generally accepted
in the United States.

ERNST & YOUNG LLP

Chicago, Illinois
July 12, 2000

F-5-1
<PAGE>
NORTH SHORE CABLE CONTRACTORS, INC.

BALANCE SHEETS

(IN THOUSANDS)

<TABLE>
<CAPTION>
DECEMBER 31
-------------------
1998 1999
-------- --------
<S> <C> <C>
ASSETS
Current assets:
Cash...................................................... $ 328 $ 220
Accounts receivable, including retainage of $395 and $98
(less allowance of $50 and $144)........................ 763 1,579
Unbilled revenues......................................... 292 591
Note receivable from affiliate............................ 113 123
Prepaid expenses and other current assets................. 65 33
Deferred income taxes..................................... 141 19
------ ------
Total current assets........................................ 1,702 2,565
Fixed assets, net........................................... 768 1,151
Other assets................................................ 14 4
------ ------
Total assets................................................ $2,484 $3,720
====== ======
LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT)
Current liabilities:
Line of credit............................................ $ 426 $ 500
Current portion of notes payable.......................... 148 242
Notes payable to stockholders............................. 659 --
Accounts payable.......................................... 651 935
Accrued expenses.......................................... 251 97
Income taxes.............................................. -- 389
------ ------
Total current liabilities................................... 2,135 2,163
Long-term portion of notes payable.......................... 368 619
Deferred tax liabilities.................................... 51 79
Stockholders' equity (deficit):
Common stock, no par value, $1.00 stated value; 500 shares
authorized, issued, and outstanding..................... 1 1
(Accumulated deficit) retained earnings................... (71) 858
------ ------
Total stockholders' (deficit) equity........................ (70) 859
------ ------
Total liabilities and stockholders' equity (deficit)........ $2,484 $3,720
====== ======
</TABLE>

See accompanying notes to the financial statement.

F-5-2
<PAGE>
NORTH SHORE CABLE CONTRACTORS, INC.

STATEMENTS OF OPERATIONS

(IN THOUSANDS)

<TABLE>
<CAPTION>
YEAR ENDED DECEMBER 31
------------------------------
1997 1998 1999
-------- -------- --------
<S> <C> <C> <C>
Net revenue................................................. $1,861 $5,312 $9,835
Costs of sales.............................................. 1,135 4,423 7,571
------ ------ ------
Gross profit................................................ 726 889 2,264
General and administrative expenses......................... 732 1,079 599
------ ------ ------
(Loss) income from operations............................... (6) (190) 1,665
Other income (expense):
Interest expense.......................................... (19) (47) (137)
Other income, net......................................... 39 10 12
------ ------ ------
Total other income (expense), net........................... 20 (37) (125)
------ ------ ------
Income (loss) before income taxes........................... 14 (227) 1,540
Income tax (expense) benefit................................ (3) 91 (609)
------ ------ ------
Net income (loss)........................................... $ 11 $ (136) $ 931
====== ====== ======
</TABLE>

See accompanying notes to financial statements.

F-5-3
<PAGE>
NORTH SHORE CABLE CONTRACTORS, INC.

STATEMENTS OF STOCKHOLDERS' EQUITY (DEFICIT)

(IN THOUSANDS, EXCEPT SHARE DATA)

<TABLE>
<CAPTION>
TOTAL
RETAINED STOCKHOLDERS'
COMMON EARNINGS EQUITY
SHARES STOCK (DEFICIT) (DEFICIT)
-------- -------- --------- -------------
<S> <C> <C> <C> <C>
Balance at December 31, 1996........................... 500 $1 $ 57 $ 58
Net income............................................. -- -- 11 11
Dividends declared..................................... -- -- (1) (1)
--- -- ----- -----
Balance at December 31, 1997........................... 500 1 67 68
Net loss............................................... -- -- (136) (136)
Dividends declared..................................... -- -- (2) (2)
--- -- ----- -----
Balance at December 31, 1998........................... 500 1 (71) (70)
Net income............................................. -- -- 931 931
Dividends declared..................................... -- -- (2) (2)
--- -- ----- -----
Balance at December 31, 1999........................... 500 $1 $ 858 $ 859
=== == ===== =====
</TABLE>

See accompanying notes to financial statements.

F-5-4
<PAGE>
NORTH SHORE CABLE CONTRACTORS, INC.

STATEMENTS OF CASH FLOWS

(IN THOUSANDS)

<TABLE>
<CAPTION>
YEAR ENDED DECEMBER 31
------------------------------
1997 1998 1999
-------- -------- --------
<S> <C> <C> <C>
OPERATING ACTIVITIES
Net income (loss)........................................... $ 11 $(136) $ 931
Adjustments to reconcile net income (loss) to net cash
provided by (used in) operating activities:
Depreciation............................................ 54 117 208
Deferred income taxes................................... (17) (139) 150
Provision (reversal of provision) for doubtful
accounts.............................................. -- 87 (63)
Changes in operating assets and liabilities:
Accounts receivable and unbilled revenues............. (248) (802) (1,052)
Note receivable from affiliate........................ -- (69) (11)
Prepaid expenses and other assets..................... (23) (15) 42
Accounts payable and other............................ 75 490 284
Accrued expenses...................................... 202 18 234
----- ----- -------
Net cash provided by (used in) operating activities......... 54 (449) 723

INVESTING ACTIVITIES
Purchase of fixed assets, net............................... (417) (355) (589)
----- ----- -------
Net cash used in investing activities....................... (417) (355) (589)

FINANCING ACTIVITIES
Net borrowings under line of credit......................... 100 326 74
Proceeds from notes payable................................. 359 280 531
Principal payments on notes payable......................... (69) (156) (186)
Proceeds from notes payable to stockholders................. 184 474 --
Payments on notes payable to stockholders................... -- -- (659)
Dividends to stockholders................................... (1) (2) (2)
----- ----- -------
Net cash provided by (used in) financing activities......... 573 922 (242)
----- ----- -------
Increase (decrease) in cash................................. 210 118 (108)
----- ----- -------
Cash at beginning of year................................... -- 210 328
----- ----- -------
Cash at end of year......................................... $ 210 $ 328 $ 220
===== ===== =======

SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION
Cash paid for:..............................................
Interest.................................................. $ 19 $ 48 $ 124
Income taxes.............................................. 13 40 59
</TABLE>

See accompanying notes to financial statements.

F-5-5
<PAGE>
NORTH SHORE CABLE CONTRACTORS, INC.

NOTES TO FINANCIAL STATEMENTS

(IN THOUSANDS)

1. BASIS OF PRESENTATION AND DESCRIPTION OF BUSINESS

North Shore Cable Contractors, Inc. (the Company) is located in Painesville,
Ohio, and provides network infrastructure installation services primarily to the
telecommunications and cable industries. This service is provided in various
states. Services are usually performed under fixed-price per unit produced
contracts.

2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

FIXED ASSETS

Fixed assets are stated at cost, less accumulated depreciation. Depreciation
is calculated using the straight-line method over the estimated service life of
five years for vehicles and office equipment, seven years for machinery and
equipment, and over the term of the lease on leasehold improvements.
Depreciation expense was $54, $117, and $208 for the years ended December 31,
1997, 1998, and 1999, respectively.

LONG-LIVED ASSETS

The Company evaluates its long-lived assets on an ongoing basis. Long-lived
assets are reviewed for impairment whenever events or changes in circumstances
indicate that the carrying amount of the related asset may not be recoverable.
Recoverability of assets to be held and used is measured by a comparison of the
carrying amount of the asset to future undiscounted cash flows expected to be
generated by the asset. If the asset is determined to be impaired, the
impairment recognized is measured by the amount by which the carrying value of
the asset exceeds its fair value. No indications of impairment have been noted
by management.

REVENUE AND COST RECOGNITION

The Company recognizes revenue based on the percentage-of-completion method
with progress measured by the number of units produced. Accordingly, revenue
from services provided to customers is reported as earned as measured by the
completion of units produced under the contract. Unbilled revenues represent
amounts earned and recognized in the period for which billings are issued in the
following period.

SIGNIFICANT CUSTOMERS

Two customers accounted for approximately 63% and 22% of the Company's
accounts receivable balance at December 31, 1999. Five customers accounted for
approximately 50%, 21%, 13%, 5% and 5% of the Company's revenues for the year
ended December 31, 1999. Two customers accounted for approximately 40% and 36%
of the Company's accounts receivable balance at December 31, 1998.

F-5-6
<PAGE>
NORTH SHORE CABLE CONTRACTORS, INC.

NOTES TO FINANCIAL STATEMENTS (CONTINUED)

(IN THOUSANDS)

2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
FAIR VALUE OF FINANCIAL INSTRUMENTS

The carrying value of cash, accounts receivable, unbilled revenues, note
receivable from affiliate, other current assets, accounts payable, and accrued
expenses approximate their fair value at December 31, 1998 and 1999, due to the
short-term nature of these instruments.

The Company estimates the fair value of fixed rate long-term debt
obligations, including any current portion, using the discounted cash flows
method with interest rates currently available for similar obligations. The
carrying amounts reported in the Company's balance sheet for these obligations
approximate fair value.

INCOME TAXES

Deferred income taxes have been recognized for the tax consequences of
temporary differences between financial reporting and income tax reporting by
applying the enacted statutory income tax rates applicable to future years of
differences between the financial statement carrying amounts and the tax bases
of the existing assets and liabilities.

CONCENTRATION OF CREDIT RISK

The Company maintains cash deposits with a financial institution that, at
times, exceeds the FDIC limits. The Company limits the amount of credit exposure
with one financial institution and believes that no significant concentration of
credit risk exists with respect to cash.

Financial instruments that potentially subject the Company to significant
concentrations of credit risk consist principally of trade accounts receivable.
To minimize this risk, ongoing credit evaluations of customers' financial
condition are performed, although collateral is not required. In addition, the
Company maintains an allowance for potential credit losses. The Company
estimates an allowance for doubtful accounts based on the creditworthiness of
its customers as well as general economic conditions. Consequently, an adverse
change in those factors could affect the Company's estimate of its allowance for
doubtful accounts.

USE OF ESTIMATES

RECLASSIFICATIONS

Certain prior years' amounts have been reclassified to conform to the 1999
presentation.

F-5-7
<PAGE>
NORTH SHORE CABLE CONTRACTORS, INC.

NOTES TO FINANCIAL STATEMENTS (CONTINUED)

(IN THOUSANDS)

3. FIXED ASSETS

Fixed assets consists of:

<TABLE>
<CAPTION>
DECEMBER 31
-------------------
1998 1999
-------- --------
<S> <C> <C>
Machinery and equipment..................................... $ 735 $1,087
Vehicles.................................................... 277 503
Office equipment............................................ 23 27
Leasehold improvements...................................... -- 5
------ ------
1,035 1,622
Less: Accumulated depreciation.............................. 267 471
------ ------
$ 768 $1,151
====== ======
</TABLE>

4. THIRD-PARTY INDEBTEDNESS

The Company's third-party indebtedness consists of a $500 revolving
line-of-credit facility (the revolver) and various notes payable. The revolver
is evidenced by a promissory note due on demand that bears interest at the
lender's prime rate (8.5% at December 31, 1999) plus 0.75%. Borrowings under the
revolver are secured by substantially all assets of the Company and a junior
mortgage on property leased by the Company (see Note 7).

The Company has various notes payable outstanding which were used to finance
fixed asset purchases. These notes mature from September 2002 through
October 2004 and bear interest from 7.9% to 13.1% with a weighted-average
interest rate of 9.4%. These notes are collateralized by the assets acquired.

Aggregate maturities of the Company's notes payable for each of the next
five years ending December 31 are as follows:

5. OPERATING LEASES

The Company leases machinery and equipment under operating leases from
unaffiliated entities on a month-to-month basis. Rent expense for such leases
was $59, $144, and $170 for the years ended December 31, 1997, 1998, and 1999.

As described in Note 7, the Company also leases office and shop space from
stockholders of the Company.

F-5-8
<PAGE>
NORTH SHORE CABLE CONTRACTORS, INC.

NOTES TO FINANCIAL STATEMENTS (CONTINUED)

(IN THOUSANDS)

6. INCOME TAXES

The components of the provision for income tax expense (benefit) are as
follows:

<TABLE>
<CAPTION>
YEAR ENDED DECEMBER 31
------------------------------------
1997 1998 1999
-------- -------- --------
<S> <C> <C> <C>
Current income taxes:
Federal.............................................. $15 $ 35 $341
State................................................ 5 13 118
--- ---- ----
20 48 459
Deferred income taxes.................................. (17) (139) 150
--- ---- ----
Income taxes........................................... $ 3 $(91) $609
=== ==== ====
</TABLE>

Reconciliation of the effective income tax rate computed at the U.S. federal
statutory rate to income tax expense (benefit) is as follows:

<TABLE>
<CAPTION>
YEAR ENDED DECEMBER 31
------------------------------------
1997 1998 1999
-------- -------- --------
<S> <C> <C> <C>
Income taxes at U.S. federal statutory rate......... 19.00% (34.00)% 34.00%
State income taxes, net of federal benefit.......... 5.58 (5.95) 5.53
----- ------ -----
Income tax expense (benefit)........................ 24.58% (39.95)% 39.53%
===== ====== =====
</TABLE>

Significant components of the Company's deferred income taxes are as
follows:

<TABLE>
<CAPTION>
DECEMBER 31
-------------------
1998 1999
-------- --------
<S> <C> <C>
Deferred tax assets:
Allowance for doubtful accounts........................... $55 $ 19
Net operating loss carryforward........................... 86 --
--- ----
141 19
Deferred tax liabilities:
Tax depreciation in excess of book depreciation........... (51) (79)
--- ----
Net deferred income taxes................................... $90 $(60)
=== ====
</TABLE>

7. RELATED PARTY TRANSACTIONS

The Company leases office and shop space under an operating lease from MK
Development, LLC (MK) which is owned by the stockholders of the Company. The
lease expires in March 2001. Rent expense under these operating leases was $16,
$20, and $20 for the years ended December 31, 1997, 1998, and 1999,
respectively.

F-5-9
<PAGE>
NORTH SHORE CABLE CONTRACTORS, INC.

NOTES TO FINANCIAL STATEMENTS (CONTINUED)

(IN THOUSANDS)

7. RELATED PARTY TRANSACTIONS (CONTINUED)
Future minimum lease payments under these operating leases are as follows at
December 31, 1999:

The Company also loans cash to MK from time to time which bears interest at
the prime lending rate. At December 31, 1998 and 1999, note receivable from
affiliate was $104 and $105 and bore interest at approximately 8.5%. Interest
owed to the Company totaled $8 and $18 as of December 31, 1998 and 1999.
Principal and interest are payable to the Company on demand.

The Company had notes payable to stockholders totaling $185 and $659 at
December 31, 1997 and 1998, respectively. The Company paid off $659 of the
outstanding debt in 1999. The notes payable were for working capital
requirements and were due on demand with interest at 8.5%. Interest expense to
stockholders was $0, $3, and $41 for the years ended December 31, 1997, 1998,
and 1999.

8. LEGAL PROCEEDINGS

The Company is subject to various claims, including workers' compensation
and property damage claims, arising in the ordinary course of business and is
party to various legal proceedings which are routine and incidental to the
Company's business. In the opinion of management, all such matters are either
adequately covered by insurance or are not expected to have a material adverse
effect on the Company.

9. DEFINED-CONTRIBUTION PLAN

The Company maintains a defined-contribution 401(k) plan covering
substantially all of its employees. The plan provides for a discretionary
employer profit-sharing contribution to employees who have worked more that
1,000 hours during the year. For the year ended December 31, 1998, the Company's
discretionary matching contribution totaled $69,204. The Company did not make a
contribution for either of the years ended December 31, 1997 and 1999.

10. SUBSEQUENT EVENT

On January 21, 2000, the Company's stockholders and Linc.net Inc. entered
into a stock purchase agreement whereby Linc.net Inc. acquired all of the
outstanding capital stock of the Company at an aggregate purchase price of
approximately $6,100 (including transaction costs).

F-5-10
<PAGE>
REPORT OF INDEPENDENT AUDITORS

The Board of Directors
Telpro Technologies, Inc.

We have audited the accompanying balance sheets of Telpro
Technologies, Inc. as of December 31, 1998 and 1999, and the related statements
of operations, stockholders' (deficit) equity, and cash flows for each of the
three years in the period ended December 31, 1999. These financial statements
are the responsibility of the Company's management. Our responsibility is to
express an opinion on these financial statements based on our audits.

In our opinion, the financial statements referred to above present fairly,
in all material respects, the financial position of Telpro Technologies, Inc. at
December 31, 1998 and 1999, and the results of its operations and its cash flows
for each of the three years in the period ended December 31, 1999 in conformity
with accounting principles generally accepted in the United States.

ERNST & YOUNG LLP

Chicago, Illinois
August 18, 2000

F-6-1
<PAGE>
TELPRO TECHNOLOGIES, INC.

BALANCE SHEETS

(AMOUNTS IN THOUSANDS, EXCEPT SHARE DATA)

<TABLE>
<CAPTION>
DECEMBER 31
-------------------
1998 1999
-------- --------
<S> <C> <C>
ASSETS
Current assets:
Cash...................................................... $ 379 $ 18
Accounts receivable, less allowance of $74 in 1998 and
$259 in 1999 2,224 11,426
Costs and estimated earnings in excess of billings on
uncompleted contracts................................... 862 1,182
Inventory................................................. 455 2,751
Prepaid expenses.......................................... 8 229
Income tax receivable..................................... -- 448
Deferred income taxes..................................... -- 181
Note receivable from stockholder.......................... -- 37
------ -------
Total current assets........................................ 3,928 16,272
Fixed assets, net........................................... 241 673
Other assets................................................ 49 306
------ -------
Total assets................................................ $4,218 $17,251
====== =======

LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Notes payable to stockholders............................. $ 220 $ --
Current maturities of long-term obligations............... 629 110
Line of credit............................................ 270 1,680
Accounts payable.......................................... 668 8,123
Accrued expenses.......................................... 1,262 3,321
Billings in excess of costs and estimated earnings on
uncompleted contracts................................... 77 577
Provision for losses on contracts......................... 145 28
Deferred income taxes..................................... 176 --
------ -------
Total current liabilities................................... 3,447 13,839

Long-term obligations, less current maturities.............. 125 11

Stockholders' equity:
Common stock, Class A, no par value; 10,000,000 shares
authorized--1,789,300 and 2,450,000 shares issued and
outstanding............................................. 69 607
Common stock, Class B, no par value, nonvoting, 2,000,000
shares authorized, 550,117 and 687,617 shares issued and
outstanding............................................. 21 136
Retained earnings......................................... 556 2,658
------ -------
Total stockholders' equity.................................. 646 3,401
------ -------
Total liabilities and stockholders' equity.................. $4,218 $17,251
====== =======
</TABLE>

See accompanying notes to financial statements.

F-6-2
<PAGE>
TELPRO TECHNOLOGIES, INC.

STATEMENTS OF OPERATIONS

(AMOUNTS IN THOUSANDS)

<TABLE>
<CAPTION>
YEAR ENDED DECEMBER 31
1997 1998 1999
-------- -------- --------
<S> <C> <C> <C>
Net revenue................................................. $12,427 $19,652 $73,532
Costs of sales.............................................. 11,793 14,422 65,120
------- ------- -------
Gross profit................................................ 634 5,230 8,412

General and administrative expenses......................... 2,280 1,690 4,389
Noncash stock compensation expense.......................... -- -- 560
Severance and settlement costs.............................. -- 679 --
------- ------- -------
Total operating expenses.................................... 2,280 2,369 4,949
------- ------- -------
(Loss) income from operations............................... (1,646) 2,861 3,463

Other (expense) income, net:
Interest expense.......................................... (25) (219) (187)
Other (expense) income, net............................... (62) (13) 191
------- ------- -------
Total other (expense) income, net........................... (87) (232) 4
------- ------- -------
(Loss) income before income taxes........................... (1,733) 2,629 3,467
Income taxes................................................ 680 (1,040) (1,365)
------- ------- -------
Net (loss) income........................................... $(1,053) $ 1,589 $ 2,102
======= ======= =======
</TABLE>

See accompanying notes to financial statements.

F-6-3
<PAGE>
TELPRO TECHNOLOGIES, INC.

STATEMENTS OF STOCKHOLDERS' (DEFICIT) EQUITY

(AMOUNTS IN THOUSANDS, EXCEPT SHARE DATA)

<TABLE>
<CAPTION>
CLASS A AND CLASS B
COMMON STOCK
--------------------- RETAINED
NUMBER OF EARNINGS
SHARES AMOUNT (DEFICIT) TOTAL
---------- -------- --------- --------
<S> <C> <C> <C> <C>
Balance at January 1, 1997........................... 2,794,269 $ 93 $ 113 $ 206
Issuance of Class A common stock..................... 11,526 49 -- 49
Net loss............................................. -- -- (1,053) (1,053)
---------- ---- ------- -------
Balance at December 31, 1997......................... 2,805,795 142 (940) (798)
Redemption of common stock........................... (1,260,918) (52) (93) (145)
Cancellation of common stock......................... (1,544,877) (90) -- (90)
Reissuance of common stock........................... 500,000 90 -- 90
Redemption of common stock........................... (500,000) (90) -- (90)
Issuance of Class A common stock..................... 1,789,300 69 -- 69
Issuance of Class B common stock..................... 550,117 21 -- 21
Net income........................................... -- -- 1,589 1,589
---------- ---- ------- -------
Balance at December 31, 1998......................... 2,339,417 90 556 646
Redemption of common stock--Class A.................. (1,800) (40) -- (40)
Cancellation of common stock--Class A................ (50,000) -- -- --
Issuance of Class A common stock..................... 712,500 578 -- 578
Issuance of Class B common stock..................... 137,500 115 -- 115
Net income........................................... -- -- 2,102 2,102
---------- ---- ------- -------
Balance at December 31, 1999......................... 3,137,617 $743 $ 2,658 $ 3,401
========== ==== ======= =======
</TABLE>

See accompanying notes to financial statements.

F-6-4
<PAGE>
TELPRO TECHNOLOGIES, INC.

STATEMENTS OF CASH FLOWS

(AMOUNTS IN THOUSANDS, EXCEPT SHARE DATA)

<TABLE>
<CAPTION>
YEAR ENDED DECEMBER 31
------------------------------
1997 1998 1999
-------- -------- --------
<S> <C> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES
Net (loss) income........................................... $(1,053) $ 1,589 $ 2,102
Adjustments to reconcile net (loss) income to net cash (used
in) provided by operating activities:
Depreciation.............................................. 94 106 194
Amortization.............................................. 6 2 29
Loss on disposal of fixed assets.......................... -- 24 --
Issuance of common stock as compensation.................. -- -- 560
Provision for doubtful accounts........................... 72 2 184
Deferred income taxes..................................... (514) 704 (357)
Provision (reversal of provision) for losses on
contracts............................................... 548 (489) (117)
Changes in operating assets and liabilities:
Accounts receivable..................................... 642 (990) (9,387)
Costs and estimated earnings in excess of billings on
uncompleted contracts................................. 88 (477) (320)
Inventory............................................... -- (455) (2,296)
Prepaid expenses........................................ 8 (3) (221)
Note receivable......................................... -- -- (37)
Other assets............................................ (24) -- (154)
Accounts payable........................................ (189) 81 7,455
Accrued expenses........................................ (211) 944 1,611
Billings in excess of costs and estimated earnings on
uncompleted contracts................................. 77 (339) 500
------- ------- -------
Net cash (used in) provided by operating activities......... (456) 699 (254)
CASH FLOWS FROM INVESTING ACTIVITIES
Purchase of fixed assets.................................... (178) (152) (624)
------- ------- -------
Cash used in investing activities........................... (178) (152) (624)
CASH FLOWS FROM FINANCING ACTIVITIES
(Payments on) proceeds from term loan....................... (416) 200 (633)
Proceeds from (payment on) stockholder notes................ -- 220 (220)
Net proceeds from (payments on) line of credit.............. 1,239 (1,044) 1,410
Redemption of common stock.................................. -- (30) (40)
Issuance of common stock.................................... 49 -- --
Principal payment on capital leases......................... -- (2) --
------- ------- -------
Net cash provided by (used in) financing activities......... 872 (656) 517
------- ------- -------
Increase (decrease) in cash................................. 238 (109) (361)
Cash at beginning of year................................... 250 488 379
------- ------- -------
Cash at end of year......................................... $ 488 $ 379 $ 18
======= ======= =======
SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION
Cash paid during the year for:
Interest.................................................. $ 79 $ 209 $ 192
Taxes..................................................... 188 -- 2,546
</TABLE>

See accompanying notes to financial statements.

F-6-5
<PAGE>
TELPRO TECHNOLOGIES, INC.

NOTES TO FINANCIAL STATEMENTS

(AMOUNTS IN THOUSANDS, EXCEPT SHARE DATA)

YEARS ENDED DECEMBER 31, 1997, 1998, AND 1999

1. DESCRIPTION OF BUSINESS

Telpro Technologies, Inc. (the Company) is a California corporation formed
in 1990. The Company conducts several business enterprises within the
telecommunications industry. The Company provides telecommunication equipment,
engineering, design and installation services to the central offices of major
network providers.

2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

REVENUE RECOGNITION

Revenues from fixed-price and modified fixed-price construction contracts
are recognized using the percentage-of-completion method, measured by the
percentage of costs incurred to date to estimated total costs applied to
estimated total revenue.

Contract costs include all direct material and labor costs and the indirect
costs related to contract performance, such as indirect labor, supplies, tools,
repairs, and depreciation costs. General and administrative costs are charged to
expense as incurred. Provisions for total estimated losses on uncompleted
contracts are made in the period in which it becomes probable a loss will be
incurred on the contract. Changes in job performance, job conditions, and
estimated profitability, including those arising from contract penalty
provisions, and final contract settlements may result in revisions to costs and
revenues and are recognized in the period in which the revisions are determined.

Revenues from engineering and project management services are recognized
when the service has been provided. Sales revenues from network system
components are recognized when the products have been shipped.

INCOME TAXES

The Company uses the liability method of accounting for income taxes. Under
this method, deferred tax assets and liabilities are determined based on
differences between the carrying amounts of assets and liabilities for financial
reporting purposes and the amounts used for income tax return purposes, and are
measured using the enacted tax rates at which the resulting taxes are expected
to be paid.

USE OF ESTIMATES

INVENTORY

Inventory is stated at the lower of cost or market, using the first in,
first out method.

FIXED ASSETS

Fixed assets are stated at cost, less accumulated depreciation. Depreciation
is calculated using the straight-line method of depreciation over the estimated
useful life of the assets which is three years.

F-6-6
<PAGE>
TELPRO TECHNOLOGIES, INC.

NOTES TO FINANCIAL STATEMENTS (CONTINUED)

(AMOUNTS IN THOUSANDS, EXCEPT SHARE DATA)

2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
ADVERTISING

The Company expenses the cost of advertising as incurred. The Company
incurred advertising costs of approximately $147, $61, and $329 for the years
ended December 31, 1997, 1998, and 1999, respectively.

CONCENTRATION OF CREDIT RISK

The Company maintains cash with a financial institution which, at times,
exceeds the FDIC insured limits. The Company limits the amount of credit
exposure with financial institutions and believes that no significant
concentration of credit risk exists with respect to cash investments.

One customer accounted for approximately 51%, 83%, and 44% of the Company's
accounts receivable balance at December 31, 1997, 1998, and 1999, respectively.
For the year ended December 31, 1997, 1998, and 1999, one customer accounted for
approximately 75%, 89%, and 60% of the Company's revenues, respectively.

3. COSTS AND ESTIMATED EARNINGS ON UNCOMPLETED CONTRACTS

<TABLE>
<CAPTION>
DECEMBER 31
-------------------
1998 1999
-------- --------
<S> <C> <C>
Costs incurred on uncompleted contracts..................... $1,547 $2,956
Estimated earnings.......................................... 445 2,990
------ ------
1,992 5,946
Less: Billings to date...................................... 1,207 5,341
------ ------
$ 785 $ 605
====== ======
The foregoing balance is included in the accompanying
balance sheet under the following captions:
Costs and estimated earnings in excess of billings on
uncompleted contracts..................................... $ 862 $1,182
Billings in excess of costs and estimated earnings on
uncompleted contracts..................................... (77) (577)
------ ------
$ 785 $ 605
====== ======
</TABLE>

F-6-7
<PAGE>
TELPRO TECHNOLOGIES, INC.

NOTES TO FINANCIAL STATEMENTS (CONTINUED)

(AMOUNTS IN THOUSANDS, EXCEPT SHARE DATA)

4. FIXED ASSETS

Fixed assets consist of the following:

<TABLE>
<CAPTION>
DECEMBER 31
-------------------
1998 1999
-------- --------
<S> <C> <C>
Machinery and equipment..................................... $ 418 $ 862
Furniture and fixtures...................................... 37 113
Vehicles.................................................... 43 116
Leasehold improvements...................................... -- 25
----- -----
498 1,116
Less: Accumulated depreciation.............................. (257) (443)
----- -----
Fixed assets, net........................................... $ 241 $ 673
===== =====
</TABLE>

5. ACCRUED EXPENSES

Accrued expenses consist of the following:

<TABLE>
<CAPTION>
DECEMBER 31
-------------------
1998 1999
-------- --------
<S> <C> <C>
Salaries, wages, and employee benefits...................... $ 830 $2,858
Federal and state income taxes.............................. 336 --
Other....................................................... 96 463
------ ------
$1,262 $3,321
====== ======
</TABLE>

6. LINE OF CREDIT

The Company has a line of credit agreement which provides for a maximum
borrowing of the lesser of 80% of defined-eligible accounts receivable or $2,500
($1,500 in 1998). Borrowings bear interest at 9.5%, 13.75% and 11% at
December 31, 1997, 1998 and 1999, respectively. Minimum interest is payable at
$4 per month. The outstanding balance and unused borrowing capacity under the
agreement at December 31, 1999 were $1,680 and $820, respectively. All
borrowings are secured by the assets of the Company and are personally
guaranteed by Company stockholders.

F-6-8
<PAGE>
TELPRO TECHNOLOGIES, INC.

NOTES TO FINANCIAL STATEMENTS (CONTINUED)

(AMOUNTS IN THOUSANDS, EXCEPT SHARE DATA)

7. INCOME TAXES

The tax effect of major temporary differences that give rise to deferred
income tax assets and liabilities are as follows:

<TABLE>
<CAPTION>
DECEMBER 31
-------------------
1998 1999
-------- --------
<S> <C> <C>
Deferred tax assets:
Accruals.................................................. $ -- $ 230
Revenue recognition on contracts in progress.............. -- --
Allowance for doubtful accounts........................... -- 103
Severance pay............................................. 41 41
Provision for losses on contracts......................... 58 11
AMT/NOL credit carryforwards.............................. 31 --
Other..................................................... 6 37
----- -----
Total deferred tax assets................................... 136 422

Deferred tax liabilities:
Revenue recognition on contracts in progress.............. (312) (241)
----- -----
Net deferred tax asset (liability).......................... $(176) $ 181
===== =====
</TABLE>

Significant components of income tax (benefit) expense at consist of:

<TABLE>
<CAPTION>
DECEMBER 31
------------------------------
1997 1998 1999
-------- -------- --------
<S> <C> <C> <C>
Deferred:
Federal.............................................. $(440) $ 616 $ (305)
State................................................ (74) 88 (52)
----- ------ ------
(514) 704 (357)

Current:
Federal.............................................. (167) 246 1,461
State................................................ 1 90 261
----- ------ ------
(166) 336 1,722
----- ------ ------
$(680) $1,040 $1,365
===== ====== ======
</TABLE>

F-6-9
<PAGE>
TELPRO TECHNOLOGIES, INC.

NOTES TO FINANCIAL STATEMENTS (CONTINUED)

(AMOUNTS IN THOUSANDS, EXCEPT SHARE DATA)

7. INCOME TAXES (CONTINUED)
A reconciliation of the income tax (benefit) provision computed at the U.S.
federal statutory tax rate to the reported income tax (benefit) provision at is
as follows:

<TABLE>
<CAPTION>
DECEMBER 31
------------------------------
1997 1998 1999
-------- -------- --------
<S> <C> <C> <C>
Tax (benefit) provision at statutory rates........... $(589) $ 894 $1,169
State income taxes (benefit), net of federal tax
effect............................................. (102) 120 136
Permanent items (consisting of meals and
entertainment, and other nondeductible expenses)... 13 34 89
Other................................................ (2) (8) (29)
----- ------ ------
$(680) $1,040 $1,365
===== ====== ======
</TABLE>

8. LEASE COMMITMENTS

The Company leases office and warehouse space under operating leases. Rent
expense for the office and warehouse space were $86, $233 and $400 during the
years ended December 31, 1997, 1998 and 1999, respectively. Future minimum
rental payments required under the leases are as follows:

9. LONG-TERM OBLIGATIONS

At December 31, 1999, other obligations consisted of the following:

<TABLE>
<S> <C>
Gary Evens settlement....................................... $ 104
Note payable to a finance company secured by Company assets.
Interest accrues at 12.10% and is payable monthly. The
note is due September 2002................................ 17
-----
Total other obligations..................................... 121
Current portion............................................. (110)
-----
Long-term obligations....................................... $ 11
=====
</TABLE>

On January 19, 1998, the Company's stockholders obtained a $200,000 loan
from a bank. The Company assumed the obligation, and the stockholders remitted
the $200,000 to the Company. The note accrues interest at 10.5%, payable
annually, and is due on demand. The note matures January 1999 and is guaranteed
by both the stockholders and the Company.

F-6-10
<PAGE>
TELPRO TECHNOLOGIES, INC.

NOTES TO FINANCIAL STATEMENTS (CONTINUED)

(AMOUNTS IN THOUSANDS, EXCEPT SHARE DATA)

9. LONG-TERM OBLIGATIONS (CONTINUED)
On June 5, 1998, the Company entered into an agreement with the then-current
president/chief executive officer and stockholder of the Company under which the
executive's employment with the Company would be terminated and the executive
would receive severance of $589. The severance obligation was expensed in 1998
and is payable in nine monthly installments of $25 and 14 monthly installments
of $26 thereafter. The Company also agreed to acquire the outstanding shares
held by the president for $114 as determined under a formula defined in the
agreement. The Company recorded the $114 obligation and a corresponding
reduction to equity. The $114 is outstanding at December 31, 1998, and is
payable in three equal monthly installments ending April 15, 1999. At
December 31, 1999, $104 of severance obligation was outstanding.

Future annual maturities of long-term obligations, subsequent to
December 31, 1999, are as follows:

10. COMMON STOCK

During November 1998, the Company redeemed and retired 1,260,918 shares of
common stock from a former employee and minority stockholders for $144 in the
aggregate, of which $30 was paid in cash and $114 in a note (see Note 9).

During 1990, the Board of Directors and stockholders approved an increase in
the authorized number of shares of common stock to 10,000,000 shares of common
stock and 2,000,000 of preferred stock by resolutions adopted on November 26,
1990. Through an oversight, the amended articles were not filed and as a result,
between the time of such resolutions and December 1998 more shares of common
stock were issued than were authorized. As a result, in December 1998, the Board
of Directors caused the reissuance of the Company's common stock to all of its
then stockholders in such a way that the total number of common shares
outstanding did not exceed 500,000, which was the amount of common stock
authorized by the Company's articles of incorporation. No preferred stock was
issued or outstanding. The relative percentage of ownership of the then
stockholder did not change as a result of this action.

At the December 1998 Board of Directors Meeting, the Board authorized the
cancellation of the existing authorized common stock and the issuance of new
voting common stock Class A (10,000,000 shares authorized) and nonvoting common
stock Class B (2,000,000 shares authorized).

On December 28, 1998, the remaining stockholders surrendered, and the
Company retired, all shares of the existing common stock (500,000) in exchange
for 1,789,300 shares of the new common stock Class A and 550,117 shares of the
new common stock Class B.

In December 1998, the Company adopted a stock compensation plan for selected
officers, directors, and key employees. The plan is designed to enable the
Company to grant participants options to purchase shares of common stock, to
issue participants restricted shares of common stock, and/or to issue
participants stock appreciation rights. The aggregate number of shares which may
be issued under the plan may not exceed 2,000,000. Each award shall include a
vesting schedule applicable to the shares to which

F-6-11
<PAGE>
TELPRO TECHNOLOGIES, INC.

NOTES TO FINANCIAL STATEMENTS (CONTINUED)

(AMOUNTS IN THOUSANDS, EXCEPT SHARE DATA)

10. COMMON STOCK (CONTINUED)
the option pertains, providing that vesting will occur at a rate of at least 20%
per year. In 1998, no awards were made under the plan.

11. DEFINED-CONTRIBUTION PLAN

The Company maintains a defined-contribution 401(k) plan covering
substantially all employees. The plan provides for a discretionary employer
profit-sharing contribution. The Company did not make any contributions during
1997, 1998 or 1999.

F-6-12
<PAGE>
TELPRO TECHNOLOGIES, INC.

CONDENSED BALANCE SHEETS

(UNAUDITED)

(AMOUNTS IN THOUSANDS)

<TABLE>
<CAPTION>
JUNE 30
-------------------
1999 2000
-------- --------
<S> <C> <C>
ASSETS
Current assets:
Cash...................................................... $ -- $ 32
Accounts receivable, less allowance of $46 in 1999 and
$259 in 2000 13,693 31,405
Costs and estimated earnings in excess of billings on
uncompleted contracts................................... 686 2,975
Inventory................................................. 847 1,829
Prepaid expenses.......................................... 381 401
Note receivable from stockholder.......................... 100 --
------- -------
Total current assets........................................ 15,707 36,642
Fixed assets, net........................................... 366 1,062
Goodwill, net............................................... 106 429
Income tax receivable....................................... -- 1,251
Other assets................................................ 58 75
------- -------
Total assets................................................ $16,237 $39,459
======= =======

LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable and accrued expenses..................... 12,615 29,036
Bank overdraft............................................ 400 --
Billings in excess of costs and estimated earnings on
uncompleted contracts................................... 156 294
Deferred income taxes..................................... 143 --
Due to affiliate.......................................... -- 16,641
------- -------
Total current liabilities................................... 13,314 45,971

Long-term obligations, less current maturities.............. 23 8
Other liabilities........................................... 104 --

Stockholders' equity:
Common stock.............................................. 49 --
Retained earnings (deficit)............................... 2,747 (6,520)
------- -------
Total stockholders' equity (deficit)........................ 2,796 (6,520)
------- -------
Total liabilities and stockholders' equity.................. $16,237 $39,459
======= =======
</TABLE>

SEE ACCOMPANYING NOTES TO CONDENSED FINANCIAL STATEMENTS.

F-6-13
<PAGE>
TELPRO TECHNOLOGIES, INC.

CONDENSED STATEMENTS OF OPERATIONS

(UNAUDITED)

(AMOUNTS IN THOUSANDS)

<TABLE>
<CAPTION>
SIX MONTHS
ENDED JUNE 30
1999 2000
-------- --------
<S> <C> <C>
Net revenue................................................. $39,633 $103,713
Costs of sales.............................................. 35,261 94,820
------- --------
Gross profit................................................ 4,372 8,893
Cost and expenses:

General and administrative expenses......................... 1,424 2,116
Noncash stock compensation.................................. 560 --
------- --------
Income from operations...................................... 2,388 6,777

Other expenses:
Interest expense, net..................................... 57 90
Other expense, net........................................ -- 78
------- --------
Income before income taxes.................................. 2,331 6,609
------- --------
Income taxes................................................ 1,012 296
------- --------
Net income.................................................. $ 1,319 $ 6,313
======= ========
</TABLE>

SEE ACCOMPANYING NOTES TO CONDENSED FINANCIAL STATEMENTS.

F-6-14
<PAGE>
TELPRO TECHNOLOGIES, INC.

CONDENSED STATEMENTS OF CASH FLOWS

(UNAUDITED)

(AMOUNTS IN THOUSANDS)

<TABLE>
<CAPTION>
SIX MONTHS ENDED
JUNE 30
-------------------
1999 2000
-------- --------
<S> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES
Net income.................................................. $ 1,319 $ 6,313
Adjustments to reconcile net income to net cash provided by
operating activities:
Depreciation.............................................. 47 193
Issuance of common stock as compensation.................. 560 --
Reversal of provision for doubtful accounts............... (28) --
Deferred income taxes..................................... (34) --
Provision (reversal of provision) for losses on
contracts............................................... (145) --
Changes in operating assets and liabilities:
Accounts receivable..................................... (11,441) (19,979)
Costs and estimated earnings in excess of billings on
uncompleted contracts................................. 176 (1,793)
Inventory............................................... (392) 923
Prepaid expenses........................................ (197) 51
Note receivable......................................... (100) (4)
Other assets............................................ (112) (1,030)
Accounts payable........................................ 9,701 17,805
Accrued expenses........................................ 1,259 (246)
Due to affiliate........................................ -- 16,641
Billings in excess of costs and estimated earnings on
uncompleted contracts................................. 79 (283)
------- -------
Net cash provided by operating activities................... 692 18,591

CASH FLOWS FROM INVESTING ACTIVITIES
Purchase of fixed assets.................................... (209) (587)
------- -------
Cash used in investing activities........................... (209) (587)

CASH FLOWS FROM FINANCING ACTIVITIES
(Payments on) proceeds from term loan....................... (627) (106)
Proceeds from (payment on) stockholder notes................ (220) --
Net proceeds from (payments on) line of credit.............. (415) (1,680)
Redemption of common stock.................................. -- (16,204)
------- -------
Net cash provided by (used in) financing activities......... (1,262) (17,990)
------- -------
(Decrease) increase in cash................................. (779) 14
Cash at beginning of year................................... 379 18
------- -------
Cash at end of year......................................... $ (400) $ 32
======= =======
</TABLE>

SEE ACCOMPANYING NOTES TO CONDENSED FINANCIAL STATEMENTS.

F-6-15
<PAGE>
TELPRO TECHNOLOGIES, INC.

NOTES TO CONDENSED FINANCIAL STATEMENTS

JUNE 30, 2000

(UNAUDITED)

(IN THOUSANDS, EXCEPT SHARE DATA)

1. DESCRIPTION OF BUSINESS

2. INTERIM FINANCIAL INFORMATION

3. INVENTORY

Inventory consists solely of finished goods and is stated at the lower of
cost or market, using the first in, first out method.

4. SALE OF COMPANY

On March 13, 2000 the Company and its stockholders entered into an agreement
with Linc.net, Inc. (Linc.net), which acquired 1,143,630 shares of Telpro stock
on that date, whereby Linc.net will acquire all of the outstanding stock of
Telpro in a series of transactions. Concurrent with the execution of the
agreement, Linc.net loaned the Company approximately $18.5 million, the proceeds
of which were used to redeem 1,134,884 shares of stock and to retire
approximately $2.3 million of existing indebtedness of the Company. The loans
from Linc.net bears interest at 10 3/8%. The interest rate is based on a
floating rate linked to Linc.net's senior credit facilities which maintain base
rate or Euro-rate loans, at Linc.net's option. Base rate loans bear interest at
the base rate plus an applicable margin for the revolving credit facility and
the Term Loan A facility and 250 basis points for the Term Loan B facility. Base
rate is defined in the senior credit facility as the higher of the interest rate
per annum announced from time to time by PNC Bank and the federal funds
effective rate, plus one half percent ( 1/2%) per annum. Euro-rate loans bear
interest at the Euro-rate as described in the amended senior credit facility,
plus an applicable margin for the bank credit facility and the Term Loan A
facility, and 400 basis points for the Term Loan B facility. Loans in the amount
of $16.2 million mature with principal and accrued interest; if any, on
October 1, 2006. The remaining loan amount is under an indefinite revolver
facility with no maturity date.

F-6-16
<PAGE>
INDEPENDENT AUDITORS' REPORT

Utility Consultants, Inc.
Atlanta, Georgia

We have audited the accompanying balance sheets of Utility
Consultants, Inc. (an S-Corporation) as of September 30, 1998 and 1999, and the
related statements of operations, stockholders' equity and cash flows for each
of the three years in the period ended September 30, 1999. These financial
statements are the responsibility of the Company's management. Our
responsibility is to express an opinion on these financial statements based on
our audits.

In our opinion, the financial statements referred to above present fairly,
in all material respects, the financial position of Utility Consultants, Inc. at
September 30, 1998 and 1999, and the results of its operations and its cash
flows for each of the three years in the period ended September 30, 1999 in
conformity with accounting principles generally accepted in the United States.

BDO SEIDMAN, LLP

Atlanta, Georgia
February 2, 2000, except for Note 6,
as to which the date is May 8, 2000

F-7-1
<PAGE>
UTILITY CONSULTANTS, INC.

(AN S-CORPORATION)

BALANCE SHEETS

(AMOUNTS IN THOUSANDS, EXCEPT SHARE DATA)

<TABLE>
<CAPTION>
SEPTEMBER 30,
-------------------
1998 1999
-------- --------
<S> <C> <C>
ASSETS (Notes 2 and 3)
Current
Cash and cash equivalents................................. $ 245 $ 612
Accounts receivable, net of allowance of $161 and $374,
respectively............................................ 4,944 7,120
Costs and estimated earnings in excess of billings on
uncompleted contracts (Note 1).......................... 3,223 1,469
Prepaid expenses.......................................... 55 68
------ -------
Total current assets........................................ 8,467 9,269
Property and equipment
Equipment................................................. 930 1,321
Vehicles.................................................. 147 168
Furniture and fixtures.................................... 195 233
Leasehold improvements.................................... 96 98
------ -------
1,368 1,820
Less accumulated depreciation............................... 723 1,005
------ -------
Net property and equipment.................................. 645 815
Other
Advances to vendor........................................ 151 --
Customer lists, net of amortization of $12 and $18,
respectively............................................ 88 82
Notes receivable from stockholders (Note 5)............... 92 105
Due from affiliate (Note 5)............................... 54 77
Miscellaneous............................................. 138 100
------ -------
Total other assets.......................................... 523 364
------ -------
$9,635 $10,448
====== =======
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities
Revolving credit agreement (Note 2)....................... $1,667 $ 3,000
Accounts payable.......................................... 754 836
Accrued payroll and payroll taxes......................... 474 571
Other accrued expenses.................................... 185 236
Billings in excess of costs and estimated earnings on
uncompleted contracts (Note 1).......................... 1,014 309
Current maturities of long-term debt (Note 3)............. 77 102
------ -------
Total current liabilities................................... 4,171 5,054
Long-term debt, less current maturities (Note 3)............ 274 295
Notes payable to stockholders (Note 5)...................... 439 385
------ -------
Total liabilities........................................... 4,884 5,734
------ -------
Commitments (Note 4)
Stockholders' equity
Common stock, $.20 par--shares authorized 50,000, issued
and outstanding 32,500.................................. 6 6
Additional paid-in capital................................ 229 229
Retained earnings......................................... 4,516 4,479
------ -------
Total stockholders' equity.................................. 4,751 4,714
------ -------
$9,635 $10,448
====== =======
</TABLE>

SEE ACCOMPANYING SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES AND NOTES TO
FINANCIAL STATEMENTS.

F-7-2
<PAGE>
UTILITY CONSULTANTS INC.

(AN S-CORPORATION)

STATEMENTS OF OPERATIONS

(AMOUNTS IN THOUSANDS)

<TABLE>
<CAPTION>
YEARS ENDED SEPTEMBER 30,
------------------------------
1997 1998 1999
-------- -------- --------
<S> <C> <C> <C>
Revenue..................................................... $21,527 $24,382 $27,955
Costs of goods sold......................................... 16,696 18,446 22,701
------- ------- -------
Gross margin.............................................. 4,831 5,936 5,254
Selling, general and administrative......................... 3,583 4,263 5,067
------- ------- -------
Operating income.......................................... 1,248 1,673 187
Interest expense............................................ 154 163 224
------- ------- -------
Net (loss) income........................................... $ 1,094 $ 1,510 $ (37)
======= ======= =======
</TABLE>

SEE ACCOMPANYING SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES AND NOTES TO
FINANCIAL STATEMENTS.

F-7-3
<PAGE>
UTILITY CONSULTANTS INC.

(AN S-CORPORATION)

STATEMENTS OF STOCKHOLDERS' EQUITY

YEARS ENDED SEPTEMBER 30, 1997, 1998 AND 1999

(AMOUNTS IN THOUSANDS)

<TABLE>
<CAPTION>
ADDITIONAL
COMMON PAID-IN RETAINED
STOCK CAPITAL EARNINGS TOTAL
-------- ---------- -------- --------
<S> <C> <C> <C> <C>
Balance, September 30, 1996.............................. $6 $229 $1,931 $2,166
Net income............................................... -- -- 1,094 1,094
-- ---- ------ ------
Balance, September 30, 1997.............................. $6 $229 $3,025 $3,260
Cash dividends paid...................................... -- -- (19) (19)
Net income............................................... -- -- 1,510 1,510
-- ---- ------ ------
Balance, September 30, 1998.............................. 6 229 4,516 4,751
Net loss................................................. (37) (37)
-- ---- ------ ------
Balance, September 30, 1999.............................. $6 $229 $4,479 $4,714
== ==== ====== ======
</TABLE>

SEE ACCOMPANYING SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES AND NOTES TO
FINANCIAL STATEMENTS.

F-7-4
<PAGE>
UTILITY CONSULTANTS, INC.

(AN S-CORPORATION)

STATEMENTS OF CASH FLOWS

(AMOUNTS IN THOUSANDS)

<TABLE>
<CAPTION>
YEARS ENDED SEPTEMBER 30,
------------------------------
1997 1998 1999
-------- -------- --------
<S> <C> <C> <C>
OPERATING ACTIVITIES
Net (loss) income......................................... $ 1,094 $ 1,510 $ (37)
Adjustments to reconcile net (loss) income to cash
provided by (used for) operating activities:
Depreciation and amortization........................... 123 232 289
Bad debt reserve........................................ 2 -- 213
Working capital changes:
Contracts in progress................................. (486) (526) 1,049
Accounts receivable................................... (1,658) (1,065) (2,389)
Accounts payable and accrued expenses................. 257 282 230
Other................................................. (181) (209) 154
------- ------- -------
Cash provided by (used for) operating activities............ (849) 224 (491)
------- ------- -------
INVESTING ACTIVITIES
Additions to property and equipment....................... (431) (218) (453)
Increases in notes receivable from stockholders........... -- (1) (13)
------- ------- -------
Cash used for investing activities.......................... (431) (219) (466)
------- ------- -------
FINANCING ACTIVITIES
Net increase in borrowings under revolving credit
agreement............................................... 1,236 89 1,333
Proceeds from issuance of long-term debt.................. 250 303 135
Principal payments on long-term debt...................... (116) (151) (90)
Principal payments on notes payable to stockholders....... (39) (50) (54)
Dividends paid............................................ -- (19) --
------- ------- -------
Cash provided by financing activities....................... 1,331 172 1,324
------- ------- -------
NET INCREASE IN CASH........................................ 51 177 367

CASH AND CASH EQUIVALENTS, beginning of year................ 17 68 245
------- ------- -------
CASH AND CASH EQUIVALENTS, end of year...................... 68 $ 245 $ 612
======= ======= =======
CASH PAID FOR INTEREST DURING THE YEAR...................... $ 141 $ 189 $ 205
======= ======= =======
</TABLE>

SEE ACCOMPANYING SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES AND NOTES TO
FINANCIAL STATEMENTS.

F-7-5
<PAGE>
UTILLITY CONSULTANTS, INC.

(AN S-CORPORATION)

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

(AMOUNTS IN THOUSANDS)

NATURE OF BUSINESS

Utility Consultants, Inc. (the "Company") is predominantly engaged in
providing engineering services to the tele-communications and power industries
throughout the United States with a concentration in the southeastern United
States.

USE OF ESTIMATES

The preparation of financial statements in conformity with generally
accepted accounting principles requires management to make estimates and
assumptions that affect the reported amounts of assets and liabilities, the
disclosure of contingent assets and liabilities at the date of the financial
statements and the reported amounts of revenue and expenses during the reporting
period. Significant estimates have been made by management in determining the
amount of its allowance for doubtful accounts receivable, the carrying value of
its uncompleted contracts and the amount of revenue to be recognized on
contracts in progress during the reporting period. Actual results could vary
from these estimates.

SIGNIFICANT CUSTOMERS AND CONCENTRATION OF CREDIT RISK

The Company contracts or subcontracts with various autonomously managed
business units of large utility companies. The Company maintains separate
relationships with each business unit. Three large telecommunications companies
constituted approximately 56%, 46% and 67% of the Company's total revenue for
the years ended September 30, 1997, 1998 and 1999, respectively. At
September 30, 1999, accounts receivable from one customer amounted to $2,044
(net of reserves) or 20% of total assets. The foregoing concentrations expose
the Company to a relatively greater degree of risk than otherwise would be the
case with greater diversification.

During the fiscal year ended September 30, 1999, the Company made the
decision to close its office in Las Vegas. The revenues and operating (loss)
income generated from this office (predominately from one customer) during the
years ended September 30, 1997, 1998 and 1999 were $45, $(7), $3,463, $417,
$2,223 and $(1,035), respectively, and are included in the Company's results of
operation for the fiscal years then ended.

The Company is in negotiations with the aforementioned customer to resolve
certain disputed items. Subsequent to September 30, 1999, the outstanding
balance has been reduced by $432 to $1,812. Effective on February 1, 2000, the
Company and the customer entered into a written settlement agreement, whereby
the customer has agreed to pay certain invoices (Phase I) aggregating $704
within 30 days of the date of the settlement agreement. Further, the Company
expects to resolve the remaining disputed items with this customer during the
month of February 2000. Based on cash collected to date, the results of the
settlement agreement pertaining to the Phase I invoices, and the anticipated
results with respect to the remaining items, management believes that the
results of these matters will have no material unfavorable effect on the
financial statements.

REVENUE RECOGNITION

Income from contract revenue is reported on the percentage-of-completion
method. Under this method, the percentage of contract revenue to be recognized
currently is based on the ratio of costs incurred to date to total estimated
contract costs, after giving effect to the most recent estimates of costs to

F-7-6
<PAGE>
UTILLITY CONSULTANTS, INC.

(AN S-CORPORATION)

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

(AMOUNTS IN THOUSANDS)

complete. Provision is made for losses on an individual contract basis in the
period in which losses are first determinable.

FINANCIAL INSTRUMENTS

The Company's financial instruments consist of cash and cash equivalents,
trade accounts receivable, accounts payable, accrued expenses and long and
short-term bank borrowings. The fair value of the Company's financial
instruments approximates their recorded value. The Company does not have
financial instruments with off-balance sheet risk. The fair value estimates were
based on market information available to management as of September 30, 1999.

The Company provides services to a limited number of very large public
utility companies, tele-communication and cable organizations. The Company
performs ongoing credit evaluations of its customers' financial condition and
generally does not require collateral from its customers. Historically, the
Company has not experienced significant losses related to receivables from
individual customers or groups of customers in any particular industry or
geographic area.

PROPERTY AND EQUIPMENT

Property and equipment are stated at cost. Depreciation is computed over the
estimated useful lives of the assets utilizing the straight-line method.
Long-lived assets are reviewed for impairment whenever events or changes in
circumstances indicate that the carrying amount may not be recoverable. If the
sum of the expected future undiscounted cash flows is less than the carrying
amount of the asset, a loss is recognized for the difference between the fair
value and carrying value of the asset.

CUSTOMER LISTS

Customer lists are stated at historical cost and are amortized over the
estimated useful life, 15 years, which is management's estimate of the number of
years the Company will realize revenues from the list. Long-lived assets are
reviewed for impairment whenever events or changes in circumstances indicate
that the carrying amount may not be recoverable. If the sum of the expected
future undiscounted cash flows is less than the carrying amount of the asset, a
loss is recognized for the difference between the fair value and carrying value
of the asset.

INCOME TAXES

The Company elected S Corporation status for income tax purposes and the
stockholders include the taxable income of the Company on their individual
income tax returns. Accordingly, no provision for income taxes is included in
the accompanying financial statements.

At September 30, 1999, there are no previously taxed retained earnings
included in the Company's stockholders' equity.

401(k) PLAN

The Company maintains a 401(k) plan covering substantially all of its
employees. The Company did not contribute in 1997. For the years ended September
30, 1998 and 1999, the Company contributed approximately $58 and $55,
respectively.

RECLASSIFICATION

Certain 1997 and 1998 amounts have been reclassified to conform to the 1999
presentation.

F-7-7
<PAGE>
UTILITY CONSULTANTS, INC.

(AN S-CORPORATION)

NOTES TO FINANCIAL STATEMENTS

(AMOUNTS IN THOUSANDS)

1. CONTRACTS IN PROGRESS

Information relative to contracts in progress was as follows:

<TABLE>
<CAPTION>
1998 1999
-------- --------
<S> <C> <C>
Costs incurred to date on contracts in progress........... $ 4,834 $ 7,089
Estimated earnings recognized to date on on these
contracts............................................... 2,297 1,992
Less: applicable billings................................. (4,922) (7,921)
------- -------
Net amounts............................................... 2,209 1,160
======= =======
Included in accompanying balance sheets under the
following captions:
Costs and estimated earnings in excess of billings on
uncompleted contracts................................. 3,223 1,469
Billings in excess of costs and estimated earnings on
uncompleted contracts................................. (1,014) (309)
------- -------
$ 2,209 $ 1,160
======= =======
</TABLE>

2. REVOLVING CREDIT AGREEMENT

The Company maintains a revolving credit agreement with a financial
institution which provides for borrowings up to $4,000 and which matures
January 31, 2000. Interest under the agreement is computed monthly at a variable
rate of .25% under the bank's prime rate (7.75% at September 30, 1999).
Substantially all of the Company's assets are collateralized under the
agreement. Additionally, borrowings under the revolving credit agreement are
guaranteed by the Company's stockholders. The agreement contains compliance
covenants and requires the maintenance of certain financial ratios. Subsequent
to year end, the Company amended the agreement to mature on April 30, 2000.

The Company also maintains a revolving credit agreement enabling them to
borrow up to $250 to purchase equipment with the same financial institution. The
Company pays interest and principal in monthly installments with interest
computed monthly at a rate of .25% under the bank's prime rate (7.75% at
September 30, 1999).

F-7-8
<PAGE>
UTILITY CONSULTANTS, INC.

(AN S-CORPORATION)

NOTES TO FINANCIAL STATEMENTS (CONTINUED)

(AMOUNTS IN THOUSANDS)

3. LONG-TERM DEBT

Long-term debt consisted of:

<TABLE>
<CAPTION>
1998 1999
-------- --------
<S> <C> <C>
$2 monthly installment note payable to a bank; interest
payable at 8.7%; secured by substantially all of the
Company's assets; guaranteed by majority stockholder;
scheduled to mature May 1, 2002........................... $273 $ 219

$6 monthly installment note payable at 7.94%; secured by
substantially all of the Company's assets; guaranteed by
majority stockholder; scheduled to mature February 15,
2003...................................................... 73 56

$3 monthly installment note payable at 7.25%; secured by
substantially all of the Company's assets; guaranteed by
majority stockholder; scheduled to mature February 1,
2004...................................................... -- 122

Other equipment notes, principal and interest payments due
monthly with interest computed at rates between 7.2% and
8.45%. Varying maturity dates through August 10, 1999..... 5 --
---- -----
351 397
Less current maturities..................................... (77) (102)
---- -----
$274 $ 295
==== =====
</TABLE>

Future maturities of long term debt are as follows:

<TABLE>
<CAPTION>
YEAR ENDED SEPTEMBER 30, AMOUNT
------------------------ --------
<S> <C>
2000........................................................ $102
2001........................................................ 110
2002........................................................ 110
2003........................................................ 60
2004........................................................ 15
----
$397
====
</TABLE>

F-7-9
<PAGE>
UTILITY CONSULTANTS, INC.

(AN S-CORPORATION)

NOTES TO FINANCIAL STATEMENTS (CONTINUED)

(AMOUNTS IN THOUSANDS)

4. COMMITMENTS

The Company leases its corporate office space under operating leases. The
aggregate minimum amounts due in subsequent years under these agreements are as
follows:

<TABLE>
<CAPTION>
YEAR ENDED SEPTEMBER 30, AMOUNT
------------------------ --------
<S> <C>
2000........................................................ $241
2001........................................................ 239
2002........................................................ 57
2003........................................................ --
2004........................................................ --
----
$537
====
</TABLE>

Rent expense for the years ended September 30, 1997, 1998 and 1999 totalled
approximately $384, $404 and $457, respectively.

5. RELATED PARTY TRANSACTIONS

The Company subcontracts certain work to an affiliate. As a result of these
transactions, the Company maintained a balance due from the affiliate of $54 and
$77, at September 30, 1998 and 1999, respectively.

Notes payable to stockholders consisted of unsecured notes to two
stockholders with varying interest rates between 9.25% and 11% per annum. The
balances outstanding at September 30, 1998 and 1999 are $439 and $385,
respectively. Interest of $5 and $11 was accrued in connection with the note
payable to stockholders at September 30, 1998 and 1999, respectively.

Notes receivable from stockholders are unsecured, non-interest bearing and
are payable upon demand.

6. SUBSEQUENT EVENT

On May 8, 2000, the Company and its principal stockholders entered into a
stock purchase agreement with Linc.net, Inc., whereby Linc.net, Inc. acquired
all of the outstanding common stock of the Company.

F-7-10
<PAGE>
UTILITIES CONSULTANTS, INC.

(AN S-CORPORATION)
CONDENSED INTERIM BALANCE SHEETS

MARCH 31, 1999 AND 2000

(UNAUDITED)

(AMOUNTS IN THOUSANDS)

<TABLE>
<CAPTION>
MARCH 31
-------------------
1999 2000
-------- --------
<S> <C> <C>
ASSETS
Current:
Cash.................................................... $ 6 $ --
Accounts receivable, net................................ 6,511 6,913
Costs and estimated earnings in excess of billings...... 2,355 2,501
Prepaid expenses........................................ 62 27
------- -------
Total current assets.................................... 8,934 9,441
Fixed assets (net)........................................ 633 754
Other assets................................................ 266 218
Goodwill.................................................... 85 78
Due from affiliate, (net)................................... 55 77
------- -------
Total assets................................................ $ 9,973 $10,568
======= =======

LIABILITIES AND STOCKHOLDERS' EQUITY
Current:
Revolving credit agreement.............................. 2,048 2,044
Accounts payable........................................ $ 1,045 $ 349
Accrued payroll and payroll taxes....................... 798 802
Other liabilities....................................... 83 100
Billings in excess of costs and estimated earnings...... 396 690
Current portion of long-term debt....................... 77 102
------- -------
Total current liabilities............................... 4,447 4,087

Note payable to stockholders................................ 412 367
Long-term debt, less current portion........................ 370 245
------- -------
Total liabilities........................................... 5,229 4,699

Stockholders' equity
Common stock............................................ 6 6
Additional paid in capital.............................. 229 229
Retained earnings....................................... 4,509 5,634
------- -------
Total stockholders' equity.................................. 4,744 5,869
------- -------
Total liabilities & stockholders' equity.................... $ 9,973 $10,568
======= =======
</TABLE>

SEE NOTES TO CONDENSED INTERIM FINANCIAL STATEMENTS.

F-7-11
<PAGE>
UTILITIES CONSULTANTS, INC.

(AN S-CORPORATION)

CONDENSED INTERIM STATEMENTS OF OPERATIONS

SIX MONTHS ENDED MARCH 31, 1999 AND 2000

(UNAUDITED)
(AMOUNTS IN THOUSANDS)

<TABLE>
<CAPTION>
SIX MONTHS ENDING
MARCH 31
-------------------
1999 2000
-------- --------
<S> <C> <C>
Revenues.................................................... $16,169 $14,686
Cost of sales............................................... 14,077 12,199
------- -------
Gross margin................................................ 2,092 2,487
General & administrative expenses......................... 1,982 1,195
------- -------
Operating income............................................ 110 1,292
Other expense...............................................
Interest expense.......................................... 119 139
------- -------
(Loss) earnings before taxes................................ (9) 1,153
Provision for taxes......................................... -- --
------- -------
Net (loss) income........................................... $ (9) $ 1,153
======= =======
</TABLE>

SEE NOTES TO CONDENSED INTERIM FINANCIAL STATEMENTS.

F-7-12
<PAGE>
UTILITIES CONSULTANTS, INC.

(AN S-CORPORATION)

CONDENSED INTERIM STATEMENTS OF CASH FLOWS

SIX MONTHS ENDED MARCH 31, 1999 AND 2000

(UNAUDITED)
(AMOUNTS IN THOUSANDS)

<TABLE>
<CAPTION>
SIX MONTHS ENDING
MARCH 31,
-------------------
1999 2000
-------- --------
<S> <C> <C>
OPERATING ACTIVITIES
Net income (loss)......................................... $ (9) $ 1,153
Adjustments to reconcile net (loss) income to
cash provided by (used for) operating activities:
Depreciation and amortization......................... 194 187
Bad debt reserve...................................... -- (10)
Working capital changes:
Contracts in progress............................... 249 (651)
Accounts receivable................................. (1,567) 217
Accounts payable and accrued expenses............... 513 (393)
Other............................................... 112 32
------- -------
Cash provided by (used for) operating activities............ (508) 535

INVESTING ACTIVITIES
Additions to property and equipment....................... (180) (122)
Increases in notes receivable from stockholders........... (1) --
------- -------

Cash used in investing activities........................... (181) (122)

FINANCING ACTIVITIES
Net (decrease) increase in borrowings under
revolving credit agreement................................ 381 (956)
Proceeds from issuance of long-term debt................ 136 --
Principal payments on long-term debt.................... (41) (50)
Principal payments on notes payable to
stockholders.......................................... (26) (19)
------- -------

Cash (used in) provided by financing activities............. 450 (1,025)
------- -------

NET DECREASE IN CASH........................................ (239) (612)
CASH AND CASH EQUIVALENTS, beginning of year................ 245 612
------- -------
CASH AND CASH EQUIVALENTS, end of year...................... $ 6 $ --
======= =======
</TABLE>

SEE NOTES TO CONDENSED INTERIM FINANCIAL STATEMENTS.

F-7-13
<PAGE>
UTILITY CONSULTANTS, INC.

(AN S-CORPORATION)

NOTES TO CONDENSED INTERIM FINANCIAL STATEMENTS

MARCH 31, 1999 AND 2000
(UNAUDITED)
(IN THOUSANDS)

1. BASIS OF PRESENTATIONS

NATURE OF BUSINESS

Utility Consultants, Inc. (the Company) is a Georgia corporation that
predominately provides engineering and program management services to the
telecommunications and electric utility industries.

2. INTERIM FINANCIAL INFORMATION

The accompanying unaudited condensed financial statements have been prepared
in accordance with generally accepted accounting principles for interim
information and with instruction to Article 10 of Regulations S-X. Accordingly,
they do not include all of the information and footnotes required by generally
accepted accounting principles for complete financial statements. In the opinion
of management, all adjustments (consisting of normal accruals) considered
necessary for fair presentation have been included. Operating results for the
six month period ended March 31, 2000 are not necessarily indicative of the
results that may be expected for the fiscal year ended September 30, 2000. These
financial statements should be read in conjunction with the financial
statements, including the notes thereto, for the year ended September 30, 1999.

The preparation of financial statements in conformity with generally
accepted accounting principles requires management to make estimates and
assumptions they affect the amounts reported in the financial statements and
accompanying notes. Actual results could differ from those estimates.

3. RELATED PARTY

The Company subcontracts work to an affiliate. The Company invoices the
customer and assists in the cash collection for such work. The Company records
revenue and subcontract expense when it invoices the customer. As a result of
the above transactions, the maintained a balance due from the affiliate of $55
and $77 at March 31, 1999 and 2000.

Notes payable to stockholders consisted of unsecured notes to two
stockholders with varying interest rates between 7% and 11% per annum. The
balances outstanding under these notes at March 31, 1999 and 2000 were $412 and
$367, respectively. Interest of $26 and $20 was accrued in connection with the
notes payable to stockholders at March 31, 1999 and 2000, respectively.

Notes receivable from stockholders are non-interest bearing and are payable
upon demand.

4. SUBSEQUENT EVENT

On May 8, 2000, the Company's stockholders and Linc.net Inc. entered into a
Stock Purchase Agreement whereby Linc.net Inc. acquired all of the outstanding
stock of the Company. The Company expensed approximately $183 in costs directly
associated with the transaction for the period from October 1, 1999 to
March 31, 2000.

F-7-14
<PAGE>
REPORT OF INDEPENDENT AUDITORS

The Board of Directors
Craig Enterprises, Inc.

We have audited the accompanying balance sheets of Craig Enterprises, Inc.
as of June 30, 1999 and June 16, 2000, and the related statements of income,
stockholders' equity, and cash flows for the years ended June 30, 1998 and 1999,
and for the period from July 1, 1999 to June 16, 2000. These financial
statements are the responsibility of the Company's management. Our
responsibility is to express an opinion on these financial statements based on
our audit.

We conducted our audit in accordance with auditing standards generally
accepted in the United States. Those standards require that we plan and perform
the audit to obtain reasonable assurance about whether the financial statements
are free of material misstatement. An audit includes examining, on a test basis,
evidence supporting the amounts and disclosures in the financial statements. An
audit also includes assessing the accounting principles used and significant
estimates made by management, as well as evaluating the overall financial
statement presentation. We believe that our audit provides a reasonable basis
for our opinion.

In our opinion, the financial statements referred to above present fairly,
in all material respects, the financial position of Craig Enterprises, Inc. at
June 30, 1999 and June 16, 2000, and the results of its operations and its cash
flows for the years ended June 30, 1998 and 1999, and the period from July 1,
1999 to June 16, 2000, in conformity with accounting principles generally
accepted in the United States.

ERNST & YOUNG LLP

Chicago, Illinois
August 11, 2000

F-8-1
<PAGE>
CRAIG ENTERPRISES, INC.

BALANCE SHEETS

(AMOUNTS IN THOUSANDS, EXCEPT SHARE DATA)

<TABLE>
<CAPTION>
JUNE 30 JUNE 16
1999 2000
-------- --------
<S> <C> <C>
ASSETS
Current assets:
Cash and cash equivalents................................. $ 381 $ 1,496
Accounts receivable....................................... 1,179 3,525
Costs and estimated earnings in excess of billings on
uncompleted contracts................................... 218 --
Prepaid expenses.......................................... 89 --
Notes receivable from stockholders........................ 67 928
------ -------
Total current assets........................................ 1,934 5,949
Fixed assets, net........................................... 4,892 4,954
------ -------
Total assets................................................ $6,826 $10,903
====== =======
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Current maturities of notes payable....................... $ 811 $ 872
Current maturities of notes payable to stockholders....... -- 40
Accounts payable.......................................... 172 1,337
Accrued expenses.......................................... 261 1,620
Billings in excess of costs and estimated earnings on
uncompleted contracts................................... 170 709
Deferred income taxes..................................... 512 116
------ -------
Total current liabilities................................... 1,926 4,694

Notes payable, less current maturities...................... 1,824 1,135
Note payable to stockholders................................ 30 --
Deferred income taxes....................................... 265 372

Stockholders' equity:
Common stock, $1 par value; 50,000 shares authorized;
1,000 shares issued and outstanding..................... 1 1
Additional paid in capital................................ 220 220
Retained earnings......................................... 2,560 4,481
------ -------
Total stockholders' equity.................................. 2,781 4,702
------ -------
Total liabilities and stockholders' equity.................. $6,826 $10,903
====== =======
</TABLE>

SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.

F-8-2
<PAGE>
CRAIG ENTERPRISES, INC.

STATEMENTS OF INCOME

(AMOUNTS IN THOUSANDS)

<TABLE>
<CAPTION>
YEARS ENDED JUNE 30 PERIOD FROM
---------------------- JULY 1, 1999 TO
1998 1999 JUNE 16, 2000
-------- -------- ----------------
<S> <C> <C> <C>
Net revenue............................................... $5,879 $11,883 $16,806
Costs of sales............................................ 4,065 9,239 12,559
------ ------- -------
Gross profit.............................................. 1,814 2,644 4,247

General and administrative expenses....................... 423 605 362
------ ------- -------
Income from operations.................................... 1,391 2,039 3,885

Other income (expense):
Interest expense........................................ (84) (146) (235)
Interest income......................................... 14 25 65

Other income (expense).................................. 46 10 (147)
------ ------- -------
Total other expense, net.................................. (24) (111) (317)
------ ------- -------
Income before income taxes................................ 1,367 1,928 3,568
Income taxes.............................................. 556 748 1,647
------ ------- -------
Net income................................................ $ 811 $ 1,180 $ 1,921
====== ======= =======
</TABLE>

SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.

F-8-3
<PAGE>
CRAIG ENTERPRISES, INC.

STATEMENTS OF STOCKHOLDERS' EQUITY

(AMOUNTS IN THOUSANDS, EXCEPT SHARE DATA)

<TABLE>
<CAPTION>
COMMON STOCK ADDITIONAL
------------------- PAID-IN RETAINED
SHARES AMOUNT CAPITAL EARNINGS TOTAL
-------- -------- ---------- -------- --------
<S> <C> <C> <C> <C> <C>
Balance at July 1, 1997........................... 1,000 $1 $220 $ 569 $ 790
Net income........................................ -- -- -- 811 811
----- -- ---- ------ ------
Balance at June 30, 1998.......................... 1,000 1 220 1,380 1,601
Net income........................................ -- -- -- 1,180 1,180
----- -- ---- ------ ------
Balance at June 30, 1999.......................... 1,000 1 220 2,560 2,781
Net income........................................ -- -- -- 1,921 1,921
----- -- ---- ------ ------
Balance at June 16, 2000.......................... 1,000 $1 $220 $4,481 $4,702
===== == ==== ====== ======
</TABLE>

SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.

F-8-4
<PAGE>
CRAIG ENTERPRISES, INC.

STATEMENTS OF CASH FLOWS

(AMOUNTS IN THOUSANDS)

<TABLE>
<CAPTION>
PERIOD FROM
JULY 1,
YEAR ENDED JUNE 30 1999 TO
------------------- JUNE 16,
1998 1999 2000
-------- -------- -----------
<S> <C> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES
Net income.................................................. $ 817 $ 1,180 $ 1,921
Adjustments to reconcile net income to net cash provided by
operating activities:
Depreciation and amortization............................. 354 671 952
(Gain) loss on disposal of fixed assets................... (46) (10) 46
Deferred income taxes..................................... 343 361 (289)
Provision for doubtful accounts........................... 18 4 --
Changes in operating assets and liabilities:
Accounts receivable..................................... 159 (691) (2,346)
Costs and estimated earnings in excess of billings on
uncompleted contracts................................. 66 (116) 218
Prepaid expenses and other assets....................... 43 (92) 89
Accounts payable........................................ 112 (354) 1,165
Accrued expenses........................................ 85 99 1,359
Billings in excess of costs and estimated earnings on
uncompleted contracts................................. 63 108 539
------- ------- -------
Net cash provided by operating activities................... 2,014 1,160 3,654

CASH FLOWS FROM INVESTING ACTIVITIES
Purchase of fixed assets.................................... (2,130) (2,819) (1,301)
Proceeds from sale of fixed assets.......................... 150 115 241
------- ------- -------
Net cash used by investing activities....................... (1,980) (2,704) (1,060)

CASH FLOWS FROM FINANCING ACTIVITIES
Proceeds from issuance of notes payable..................... 1,339 1,812 130
Issuance of notes to shareholders........................... (15) -- (861)
Proceeds from issuance of notes payable to stockholders..... -- -- 10
Payments on notes payable................................... (608) (678) (758)
------- ------- -------
Net cash provided by financing activities................... 716 1,134 (1,479)
------- ------- -------
Net decrease in cash and cash equivalents................... 750 (410) 1,115
Cash and cash equivalents at beginning of year.............. 41 791 381
------- ------- -------
Cash and cash equivalents at end of year.................... $ 791 $ 381 $ 1,496
======= ======= =======

SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION
Cash paid during the year for:
Interest.................................................. $ 84 $ 146 $ 235
Income taxes.............................................. 226 336 571
</TABLE>

SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.

F-8-5
<PAGE>
CRAIG ENTERPRISES, INC.

NOTES TO FINANCIAL STATEMENTS

FOR THE YEARS ENDED JUNE 30, 1998 AND 1999
AND FOR THE PERIOD FROM JULY 1, 1999 TO JUNE 16, 2000
(AMOUNTS IN THOUSANDS)

1. DESCRIPTION OF BUSINESS

Craig Enterprises, Inc. (the Company) was incorporated on May 11, 1990 in
the state of New Mexico; and it provides network infrastructure installation
services primarily to the telecommunications industry.

2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

REVENUE RECOGNITION

Revenues from fixed-price and cost-plus-fee construction contracts are
recognized using the percentage-of-completion method of accounting with
percentage of completion measured by the percentage of costs incurred to date to
estimated total costs, applied to estimated total revenue.

Contract costs include all direct material and labor costs and the indirect
costs related to contract performance, such as indirect labor, supplies, tools,
repair, and depreciation costs. General and administrative costs are charged to
expense as incurred. Provisions for total estimated losses on uncompleted
contracts are made in the period in which it becomes probable a loss will be
incurred on the contract. Changes in job performance, job conditions, and
estimated profitability, including those arising from contract penalty
provisions, and final contract settlements may result in revisions to costs and
revenues and are recognized in the period in which the revisions are determined.

INCOME TAXES

Deferred tax assets and liabilities are determined based on differences
between the carrying amounts of assets and liabilities for financial reporting
purposes and the amounts used for income tax return purposes, and are measured
using the enacted tax rates and laws that are expected to be in effect when the
differences reverse.

USE OF ESTIMATES

FIXED ASSETS

Fixed assets are stated at cost, less accumulated depreciation. Depreciation
is calculated using the straight-line method of depreciation over the estimated
useful life of the assets as follows:

<TABLE>
<S> <C>
Land, building and improvements............................. 7 - 39 years
Machinery and equipment..................................... 5 - 10 years
Furniture and fixtures...................................... 5 - 7 years
Vehicles.................................................... 5 - 7 years
</TABLE>

F-8-6
<PAGE>
CRAIG ENTERPRISES, INC.

NOTES TO FINANCIAL STATEMENTS (CONTINUED)

FOR THE YEARS ENDED JUNE 30, 1998 AND 1999
AND FOR THE PERIOD FROM JULY 1, 1999 TO JUNE 16, 2000
(AMOUNTS IN THOUSANDS)

2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
ADVERTISING

The Company expenses advertising cost as incurred. The Company incurred
advertising costs of approximately $3, $11, and $8 for the years ended June 30,
1998 and 1999, and the period ended June 16, 2000, respectively.

CONCENTRATION OF CREDIT RISK

Two customers individually accounted for greater than 10% of the Company's
accounts receivable at June 30, 1999 and June 16, 2000, representing 76% and
11%, and 54% and 22% of accounts receivable at such dates, respectively.

Three customers individually accounted for 30%, 28%, and 10%; 42%, 21%, and
21%; and 43%, 41%, and 10% of revenues for the years ended June 30, 1998 and
1999, and the period ended June 16, 2000, respectively.

CASH AND CASH EQUIVALENTS

The Company considers all highly liquid investments purchased with an
original maturity of three months or less to be cash equivalents.

F-8-7
<PAGE>
CRAIG ENTERPRISES, INC.

NOTES TO FINANCIAL STATEMENTS (CONTINUED)

FOR THE YEARS ENDED JUNE 30, 1998 AND 1999
AND FOR THE PERIOD FROM JULY 1, 1999 TO JUNE 16, 2000
(AMOUNTS IN THOUSANDS)

3. COSTS AND ESTIMATED EARNINGS ON UNCOMPLETED CONTRACTS

<TABLE>
<CAPTION>
JUNE 30 JUNE 16
1999 2000
-------- --------
<S> <C> <C>
Costs incurred on uncompleted contracts..................... $ 4,127 $ 1,456
Estimated earnings.......................................... 2,403 276
------- -------
6,530 1,732
Less: Billings to date...................................... (6,482) (2,441)
------- -------
$ 48 $ (709)
======= =======
The foregoing balance is included in the accompanying
balance sheet under the following captions:
Costs and estimated earnings in excess of billings on
uncompleted contracts................................. $ 218 $ --
Billings in excess of costs and estimated earnings on
uncompleted contracts................................. (170) (709)
------- -------
$ 48 $ (709)
======= =======
</TABLE>

4. FIXED ASSETS

Fixed assets consist of the following:

<TABLE>
<CAPTION>
JUNE 30 JUNE 16
1999 2000
-------- --------
<S> <C> <C>
Land, building, and improvements.......................... $ 150 $ 174
Machinery and equipment................................... 5,190 5,532
Furniture and fixtures.................................... 39 55
Vehicles.................................................. 1,170 1,350
------- -------
6,549 7,111
Less: Accumulated depreciation............................ (1,657) (2,157)
------- -------
$ 4,892 $ 4,954
======= =======
</TABLE>

5. ACCRUED EXPENSES

Accrued expenses consist of the following:

<TABLE>
<CAPTION>
JUNE 30 JUNE 16
1999 2000
-------- --------
<S> <C> <C>
Salaries, wages, and employee benefits...................... $ 48 $ 97
Federal and state income taxes.............................. 169 1,493
Other....................................................... 44 30
---- ------
$261 $1,620
==== ======
</TABLE>

F-8-8
<PAGE>
CRAIG ENTERPRISES, INC.

NOTES TO FINANCIAL STATEMENTS (CONTINUED)

FOR THE YEARS ENDED JUNE 30, 1998 AND 1999
AND FOR THE PERIOD FROM JULY 1, 1999 TO JUNE 16, 2000
(AMOUNTS IN THOUSANDS)

6. INCOME TAXES

Significant components of income tax expense (benefit), consist of the
following:

<TABLE>
<CAPTION>
JUNE 30 JUNE 16
1999 2000
-------- --------
<S> <C> <C>
Current:
Federal................................................... $324 $1,542
State..................................................... 62 394
---- ------
386 1,936
Deferred:
Federal................................................... 342 (252)
State..................................................... 20 (37)
---- ------
362 (289)
---- ------
$748 $1,647
==== ======
</TABLE>

The provision for income taxes differs from the amount of income tax
determined by applying the applicable U.S. statutory federal income tax rate to
pretax income, primarily as a result of state income taxes.

Deferred income taxes are provided for temporary differences between income
tax and financial statement recognition of revenue and expenses. Deferred tax
liabilities of $777 and $488 at June 30, 1999 and June 16, 2000, respectively,
relate primarily to property, plant, and equipment, revenue recognition on
contracts in progress and other accruals.

7. RELATED PARTY TRANSACTIONS

At June 30, 1999 and June 16, 2000 respectively, a $30 and $40 unsecured
note payable to stockholder was outstanding. The note is non-interest bearing
and is due on demand, after June 30, 2000.

The Company leased equipment owned by a related party during 1999. The
Company expensed $25 in equipment rentals associated with this lease.

The Company operates as a subcontractor for Craig Electric, Inc., an
affiliated company. During 1998, 1999, and 2000, sales to and purchases from
Craig Electric, Inc. were approximately $1,427, $248, $92, and $14, $27, and
$164, respectively. The Company also wrote off $4 in receivable balances from
Craig Electric, Inc. as bad debts during 1999.

F-8-9
<PAGE>
CRAIG ENTERPRISES, INC.

NOTES TO FINANCIAL STATEMENTS (CONTINUED)

FOR THE YEARS ENDED JUNE 30, 1998 AND 1999
AND FOR THE PERIOD FROM JULY 1, 1999 TO JUNE 16, 2000
(AMOUNTS IN THOUSANDS)

8. NOTES PAYABLE

Notes payable consisted of the following and are secured by substantially
all of the Company's fixed assets:

<TABLE>
<CAPTION>
JUNE 30 JUNE 16
1999 2000
-------- --------
<S> <C> <C>
Note payable due in monthly installments of $2 maturing July
2, 2001................................................... $ -- $ 26
Note payable due in monthly installments of $2 maturing July
2, 2001................................................... -- 27
Note payable due in monthly installments of $1 including
interest at .2%, maturing March 10, 2002.................. -- 29
Note payable due in monthly installments of $9 including
interest at 8.45%, maturing August 31, 2000............... 307 232
Note payable due in monthly installments of $1 including
interest at 7.9%, maturing June 16, 2000.................. 8 --
Note payable due in monthly installments of $1 including
interest at 7.9%, maturing June 2, 2000................... 9 --
Note payable due in monthly installments of $4 including
interest at 8.9%, maturing April 2000..................... 41 --
Note payable due in monthly installments of $5 including
interest at 8.4%, maturing November 2, 2002............... 169 131
Note payable due in monthly installments of $13 including
interest at 8.25%, maturing April 3, 2002................. 489 393
Note payable due in monthly installments of $18 including
interest at 6.75%, maturing October 2, 2002............... 630 481
Note payable due in monthly installments of $32 including
interest at 7.96%, maturing April 2, 2002................. 982 688
------ ------
2,635 2,007
Less: Current maturities.................................... (811) (872)
------ ------
$1,824 $1,135
====== ======
</TABLE>

8. NOTES PAYABLE (CONTINUED)

Aggregate maturities of notes payable, are as follows:

F-8-10
<PAGE>
CRAIG ENTERPRISES, INC.

NOTES TO FINANCIAL STATEMENTS (CONTINUED)

FOR THE YEARS ENDED JUNE 30, 1998 AND 1999
AND FOR THE PERIOD FROM JULY 1, 1999 TO JUNE 16, 2000
(AMOUNTS IN THOUSANDS)

9. BENEFIT PLAN

During 1999, the Company adopted a Simple IRA plan which allows employees to
contribute up to $6 of their salary to an individual retirement account. The
Company matches the employee contributions dollar for dollar up to 3% of each
participating employee's salary. The amount of contributions recognized as
expense to the plan for 1999 was $124, a portion of which was in excess of IRS
limits, and accordingly, was considered additional taxable compensation to the
employee.

10. SUBSEQUENT EVENT

On June 16, 2000, the Company was acquired by Linc.net Inc. The Company
expensed approximately $128 in costs directly associated with the transaction.

F-8-11
<PAGE>
INDEPENDENT AUDITORS' REPORT

To the Board of Directors and Stockholders
Felix Equities, Inc. and affiliates
Route 202 & Lovell Street
Lincolndale, New York 10540

We have audited the accompanying combined balance sheets of Felix Equities,
Inc and affiliates as of September 30, 1998 and 1999, and the related combined
statements of income and retained earnings, and cash flows for the years ended
September 30, 1997, 1998 and 1999. These combined financial statements are the
responsibility of the Company's management. Our responsibility is to express an
opinion on these combined financial statements based on our audits.

We conducted our audits in accordance with auditing standards generally
accepted in the United States. Those standards require that we plan and perform
the audits to obtain reasonable assurance about whether the combined financial
statements are free of material misstatement. An audit includes examining, on a
test basis, evidence supporting the amounts and disclosures in the combined
financial statements. An audit also includes assessing the accounting principles
used and significant estimates made by management, as well as evaluating the
overall combined financial statement presentation. We believe that our audits
provide a reasonable basis for our opinion.

In our opinion, the combined financial statements referred to above present
fairly, in all material respects, the combined financial position of Felix
Equities, Inc. and affiliates as of September 30, 1998 and 1999, and the results
of its operations and its cash flows for the years ended September 30, 1997,
1998 and 1999 in conformity with accounting principles generally accepted in the
United States.

MARDEN, HARRISON & KREUTER
Certified Public Accountants, P.C.

White Plains, New York
January 14, 2000

F-9-1
<PAGE>
FELIX EQUITIES, INC. AND AFFILIATES

COMBINED BALANCE SHEETS

SEPTEMBER 30, 1998 AND 1999

(AMOUNTS IN THOUSANDS)

<TABLE>
<CAPTION>
1998 1999
-------- --------
<S> <C> <C>
ASSETS
Current assets:
Cash and cash equivalents................................. $ 2,396 $ 1,165
Accounts receivable....................................... 18,340 27,279
Retainage receivable...................................... 3,831 6,174
Bonds substituted for retainage........................... 3,230 4,166
Costs and estimated earnings in excess of billings on
uncompleted contracts................................... 3,579 8,920
Deferred construction costs............................... 377 534
Deposits.................................................. 334 --
Prepaid expenses and other current assets................. 375 541
------- -------
Total current assets.................................... 32,462 48,779
------- -------

Property, plant and equipment:
Land...................................................... 88 88
Plant..................................................... 35 1,111
Building and improvements................................. 999 941
Vehicles, machinery and equipment......................... 13,453 18,607
Equipment and real property under capital lease........... 900 900
Furniture and fixtures.................................... 308 376
------- -------
15,783 22,023

Less accumulated depreciation and amortization............ 9,735 11,171
------- -------
Net property, plant and equipment....................... 6,048 10,852
------- -------

Other assets:
Due from affiliates....................................... -- 391
Deferred financing costs.................................. 5 3
Deposits.................................................. 199 131
------- -------
Total other assets...................................... 204 525
------- -------
Total assets............................................ $38,714 $60,156
======= =======
</TABLE>

See notes to combined financial statements.

F-9-2
<PAGE>
FELIX EQUITIES, INC. AND AFFILIATES

COMBINED BALANCE SHEETS

SEPTEMBER 30, 1998 AND 1999

(AMOUNTS IN THOUSANDS)

<TABLE>
<CAPTION>
1998 1999
-------- --------
<S> <C> <C>
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Note payable--bank........................................ $ -- $ 5,468
Current portion of long-term debt......................... 1,461 2,171
Current portion of obligations under capital lease........ 104 112
Accounts payable and accrued expenses..................... 11,732 23,695
Retainage payable......................................... 1,628 2,157
Billings in excess of costs and estimated earnings on
uncompleted contracts................................... 2,264 4,588
Loans payable--affiliate.................................. 111 --
Deferred contract revenue................................. 1,442 55
Fringe benefits and payroll taxes payable................. 3,835 3,140
Income taxes payable...................................... 4,624 4,413
------- -------
Total current liabilities............................... 27,201 45,799

Long-term debt, net of current portion...................... 2,055 2,962
Obligations under capital lease, net of current portion..... 749 590
Loans payable--stockholders................................. 119 69
------- -------
Total liabilities....................................... 30,124 49,420
------- -------

Commitments and contingencies

Stockholders' equity:
Common stock.............................................. 251 251
Retained earnings......................................... 9,839 11,985
------- -------
10,090 12,236
Less treasury stock....................................... 1,500 1,500
------- -------
Total stockholders' equity.............................. 8,590 10,736
------- -------
Total liabilities and stockholders' equity.............. $38,714 $60,156
======= =======
</TABLE>

See notes to combined financial statements.

F-9-3
<PAGE>
FELIX EQUITIES, INC. AND AFFILIATES

COMBINED STATEMENTS OF INCOME AND RETAINED EARNINGS

YEARS ENDED SEPTEMBER 30, 1997, 1998 AND 1999

(AMOUNTS IN THOUSANDS)

<TABLE>
<CAPTION>
1997 1998 1999
-------- -------- --------
<S> <C> <C> <C>
Net revenue................................................. $ 97,297 $120,136 $142,973
Costs of sales.............................................. 89,157 109,835 133,222
-------- -------- --------
Gross profit................................................ 8,140 10,301 9,751
General and administrative expenses......................... 6,163 6,988 7,429
-------- -------- --------
Income from operations...................................... 1,977 3,313 2,322
-------- -------- --------
Other income (expense):
Interest income........................................... 213 267 244
Interest expense.......................................... (288) (646) (485)
Gain on sale of property and equipment.................... 4 4 65
Other--net................................................ 79 74 (98)
-------- -------- --------
8 (301) (274)
-------- -------- --------
Income before income taxes (benefit)........................ 1,985 3,012 2,048
-------- -------- --------
Income taxes (benefit):
Current................................................... 423 958 (98)
Deferred.................................................. 189 -- --
-------- -------- --------
612 958 (98)
-------- -------- --------
Net income.................................................. 1,373 2,054 2,146
Retained earnings--beginning of year........................ 6,787 7,785 9,839
Distributions............................................... (375) -- --
-------- -------- --------
Retained earnings--end of year.............................. $ 7,785 $ 9,839 $ 11,985
======== ======== ========
</TABLE>

See notes to combined financial statements.

F-9-4
<PAGE>
FELIX EQUITIES, INC. AND AFFILIATES

COMBINED STATEMENTS OF CASH FLOWS

YEARS ENDED SEPTEMBER 30, 1997, 1998 AND 1999

(AMOUNTS IN THOUSANDS)

<TABLE>
<CAPTION>
1997 1998 1999
--------- --------- --------
<S> <C> <C> <C>
CASH PROVIDED BY (USED IN):
Operating activities:
Contract revenue........................................ $ 88,911 $ 119,051 $128,663
Contract costs.......................................... (85,063) (105,993) (121,528)
--------- --------- --------
Net cash provided by contracts...................... 3,848 13,058 7,135
General and administrative costs........................ (5,990) (7,285) (6,614)
Interest received....................................... 133 203 244
Interest paid........................................... (289) (646) (484)
Income taxes paid....................................... (251) (109) (102)
Other--net.............................................. 28 103 (99)
--------- --------- --------
Net cash provided by (used in) operating
activities........................................ (2,521) 5,324 80
--------- --------- --------
INVESTING ACTIVITIES:
Capital expenditures.................................... (2,986) (913) (7,064)
Proceeds from sale of property and equipment............ 60 56 271
Purchase of bonds substituted for retainage............. (1,116) (1,077) (2,375)
Proceeds from sale/maturity of bonds substituted for
retainage............................................. 395 1,065 1,475
Purchase of marketable securities....................... (201) -- --
Proceeds from sale of marketable securities............. 351 -- --
Net distributions from unconsolidated joint venture..... 210 -- --
Repayments from (advances to) affiliates................ (324) 1,161 (502)
--------- --------- --------
Net cash provided by (used in) investing
activities........................................ (3,611) 292 (8,195)
--------- --------- --------
FINANCING ACTIVITIES:
Proceeds from (repayments on) note payable to bank...... 2,600 (2,600) 5,468
Proceeds from issuance of long-term debt................ 2,500 -- 3,969
Principal payments on long-term debt.................... (1,241) (1,402) (2,352)
Net payments to stockholders............................ 280 (154) (50)
Principal payments on obligations under capital lease... (40) (110) (151)
Distributions to stockholders........................... (375) -- --
--------- --------- --------
Net cash provided by (used in) financing
activities........................................ 3,724 (4,266) 6,884
--------- --------- --------
Net increase (decrease) in cash and cash equivalents........ (2,408) 1,350 (1,231)
Cash and cash equivalents, beginning of year................ 3,454 1,046 2,396
--------- --------- --------
Cash and cash equivalents, end of year...................... $ 1,046 $ 2,396 $ 1,165
========= ========= ========
</TABLE>

See notes to combined financial statements.

F-9-5
<PAGE>
FELIX EQUITIES, INC. AND AFFILIATES

COMBINED STATEMENTS OF CASH FLOWS (CONTINUED)

YEARS ENDED SEPTEMBER 30, 1997, 1998 AND 1999

(AMOUNTS IN THOUSANDS)

<TABLE>
<CAPTION>
1997 1998 1999
--------- --------- --------
<S> <C> <C> <C>
Reconciliation of net income to net cash provided by (used
in) operating activities:
Net income.............................................. $ 1,373 $ 2,054 $ 2,146
--------- --------- --------
Adjustments to reconcile net income to net cash provided
by (used in) operating activities:

Depreciation and amortization........................... 1,681 1,872 2,056
Amortization of bonds................................... (81) (64) (36)
Gain on sale of property and equipment.................. (4) (4) (65)
Loss on sale of marketable securities................... 21 -- --
Provisions for loss on accounts receivable.............. 5 -- 10
Equity in joint venture................................. (72) -- --

Changes in assets (increase) decrease:
Accounts receivable................................... (4,551) 3,031 (8,948)
Retainage receivable.................................. (2,745) 1,573 (2,343)
Costs and estimated earnings in excess of billings on
uncompleted contracts............................... (135) (1,811) (5,341)
Deferred construction costs........................... 49 (377) (157)
Prepaid expenses and other current assets............. (64) (7) (166)
Deposits.............................................. (11) (439) 401

Changes in liabilities increase (decrease):
Accounts payable and accrued expenses................. 2,206 1,213 11,963
Retainage payable..................................... 529 212 529
Billings in excess of costs and estimated earnings on
uncompleted contracts............................... (955) (3,860) 2,324
Deferred contract revenue............................. -- 1,442 (1,387)
Fringes benefits and payroll taxes payable............ (158) (384) (695)
Income taxes payable.................................. 202 1,260 (211)
Deferred income taxes................................. 189 (387) --
--------- --------- --------
Total adjustments................................... (3,894) 3,270 (2,066)
--------- --------- --------
Net cash provided by (used in) operating
activities........................................ $ (2,521) $ 5,324 $ 80
========= ========= ========
</TABLE>

See notes to combined financial statements.

F-9-6
<PAGE>
FELIX EQUITIES, INC. AND AFFILIATES

COMBINED STATEMENTS OF CASH FLOWS (CONTINUED)

YEARS ENDED SEPTEMBER 30, 1997, 1998 AND 1999

(AMOUNTS IN THOUSANDS)

SUPPLEMENTAL SCHEDULE OF NONCASH INVESTING AND FINANCING ACTIVITIES:

During the year ended September 30, 1997, the Company incurred a capital
lease obligation for $85. This obligation was satisfied during the year ended
September 30, 1998.

During the year ended September 30, 1998, the Company incurred a capital
lease obligation relating to equipment and real property for $900.

Effective September 30, 1998, the Company purchased common stock from a
former stockholder for $1,500, which was financed through notes requiring
payment over five years.

See notes to combined financial statements.

F-9-7
<PAGE>
FELIX EQUITIES, INC. AND AFFILIATES

NOTES TO COMBINED FINANCIAL STATEMENTS

YEARS ENDED SEPTEMBER 30, 1997, 1998 AND 1999

(AMOUNTS IN THOUSANDS, EXCEPT SHARE DATA)

(1) PRINCIPLES OF COMBINATION AND NATURE OF OPERATIONS:

The combined financial statements include the accounts of Felix
Equities, Inc., and companies affiliated by common stockholder interest or
control: Felix Industries, Inc. and its wholly-owned subsidiary, FMP Holding
Corp., Felix General Contracting Inc., Felix Communications Corp., Felix Asphalt
of Florida, Inc. and Felix Equities of FLA., Inc., (collectively the "Company").
Felix Asphalt of Florida, Inc. and Felix Equities of FLA., Inc. were
incorporated during the year ended September 30, 1998. All intercompany accounts
and transactions have been eliminated in combination.

The Company is a network infrastructure installation service provider that
operates primarily in the New York metropolitan area and Florida.

(2) SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES:

(A) REVENUE AND COST RECOGNITION:

Revenue is recognized on the "percentage of completion" method for reporting
revenue on contracts not yet completed, measured by the percentage of total
costs incurred to date to estimated total costs for each contract. This method
is utilized because management considers the cost-to-cost method the best
available method to measure progress on these contracts. Because of the inherent
uncertainties in estimating revenue and costs, it is at least reasonably
possible that the estimates used will change within the near term.

Contract costs include all direct material and labor costs and those other
direct and indirect costs related to contract performance including, but not
limited to, indirect labor, subcontract costs and supplies. General and
administrative costs are charged to expense as incurred.

The Company has contracts that may extend over more than one year,
therefore, revisions in cost and profit estimates during the course of the work
are reflected in the accounting period in which the facts, which required the
revisions, become known.

Provisions for estimated losses on uncompleted contracts are made in the
period in which such losses are determined. Claims on contracts are not recorded
until it is probable that the claim will result in additional contract revenue
and the amounts can be reliably estimated.

Revenues recognized in excess of amounts billed are recorded as a current
asset under the caption "Costs and estimated earnings in excess of billings on
uncompleted contracts." Billings in excess of revenues recognized are recorded
as a current liability under the caption "Billings in excess of costs and
estimated earnings on uncompleted contracts."

In accordance with construction industry practice, the Company reports in
current assets and liabilities those amounts relating to construction contracts
realizable and payable over a period in excess of one year.

(B) PROPERTY AND EQUIPMENT:

Property and equipment are stated at cost. Depreciation is computed over the
estimated useful lives of the assets using the straight-line method.
Expenditures for maintenance and repairs are charged to operations in the period
incurred.

F-9-8
<PAGE>
FELIX EQUITIES, INC. AND AFFILIATES

NOTES TO COMBINED FINANCIAL STATEMENTS (CONTINUED)

YEARS ENDED SEPTEMBER 30, 1997, 1998 AND 1999

(AMOUNTS IN THOUSANDS, EXCEPT SHARE DATA)

(2) SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES: (CONTINUED)
(C) DEFERRED FINANCING COSTS:

Costs relating to the refinancing of debt have been capitalized and are
being amortized over the loan period (ten years).

(D) CASH EQUIVALENTS:

The Company considers all highly liquid investments with original maturities
of three months or less to be cash equivalents. At September 30, 1998 and 1999,
cash equivalents consist of money market funds.

(E) DEFERRED CONTRACT REVENUE AND COSTS:

The Company has billed owners and incurred mobilization costs on contracts
which have not yet commenced. These billings and costs have been deferred by the
Company and are included in the combined balance sheets under the following
captions: "Deferred contract revenue" and "Deferred construction costs."

(F) BONDS SUBSTITUTED FOR RETAINAGE:

Bonds substituted for retainage are classified as "available-for-sale" debt
securities. Securities classified as "available-for-sale" are carried in the
financial statements at fair value. Realized gains and losses, determined using
the "first-in, first-out" method, are included in earnings; unrealized holding
gains and losses are reported as a separate component of stockholders' equity.

(G) INVESTMENT IN UNCOMBINED JOINT VENTURE:

The investment in the uncombined joint venture is accounted for using the
equity method.

(H) USE OF ESTIMATES:

(I) INCOME TAXES:

Deferred taxes are recognized for temporary differences between the basis of
assets and liabilities for financial statement and income tax purposes. The
temporary differences relate to the bases of depreciation for financial
reporting and income tax reporting. Deferred taxes are also recognized for
certain unbilled amounts that will be taxable when billed. The deferred taxes
represent the future tax return consequences of those differences which will
either be taxable or deductible when the assets and liabilities are recovered or
settled.

F-9-9
<PAGE>
FELIX EQUITIES, INC. AND AFFILIATES

NOTES TO COMBINED FINANCIAL STATEMENTS (CONTINUED)

YEARS ENDED SEPTEMBER 30, 1997, 1998 AND 1999

(AMOUNTS IN THOUSANDS, EXCEPT SHARE DATA)

(3) ACCOUNTS RECEIVABLE AND RETAINAGE:

(A) UNBILLED RECEIVABLES:

Unbilled receivables arise when amounts cannot be billed under the terms of
the contracts but are recoverable from customers upon various measures of
performance such as quantities, costs incurred and time schedules or from
routine lags in billing (for example, work completed in one month but not billed
until the next month pursuant to the contract terms.) Unbilled receivables also
include amounts expected to be collected on final requisitions on completed
contracts. Accounts receivable at September 30, 1998 and 1999 includes unbilled
receivables of $5,570 and $4,600, respectively. Unbilled receivables at
September 30, 1999 are expected to be collected within one year.

(B) RETAINAGE RECEIVABLE/PAYABLE:

The retained contract receivables include approximately $1,679 and $1,634,
at September 30, 1998 and 1999, respectively, that are not collectible within
one year.

The retained contract payables include approximately $353 and $646, at
September 30, 1998 and 1999, respectively, that are not payable within one year.

(4) BONDS SUBSTITUTED FOR RETAINAGE:

Municipal bonds, with an aggregate fair value of $3,230 and $4,166, have
been substituted in lieu of $3,215 and $3,770 of retainage at September 30, 1998
and 1999, respectively. The fair value of the bonds approximates cost basis at
both September 30, 1998 and 1999. These securities are held in trust at various
banks, pending final approval on the specific contracts, and release of the
retainage. The Company receives all investment income pertaining to these
securities.

For the year ended September 30, 1998 and 1999, there were no gross realized
gains or losses pertaining to marketable securities.

At September 30, 1998, the municipal bonds (at fair value) mature as
follows:

<TABLE>
<CAPTION>
WITHIN 1 YEAR 1-5 YEARS AFTER 5 YEARS TOTAL
--------------------- --------- ------------- --------
<S> <C> <C> <C>
$1,409 $1,821 $ -- $3,230
====== ====== ========= ======
</TABLE>

At September 30, 1999, the municipal bonds (at fair value) mature as
follows:

<TABLE>
<CAPTION>
WITHIN 1 YEAR 1-5 YEARS AFTER 5 YEARS TOTAL
--------------------- --------- ------------- --------
<S> <C> <C> <C>
$1,229 $2,348 $589 $4,166
====== ====== ==== ======
</TABLE>

F-9-10
<PAGE>
FELIX EQUITIES, INC. AND AFFILIATES

NOTES TO COMBINED FINANCIAL STATEMENTS (CONTINUED)

YEARS ENDED SEPTEMBER 30, 1997, 1998 AND 1999

(AMOUNTS IN THOUSANDS, EXCEPT SHARE DATA)

(5) CONTRACTS IN PROGRESS:

Information with respect to contracts in progress as of September 30, 1998
and 1999 is as follows:

<TABLE>
<CAPTION>
1998 1999
-------- --------
<S> <C> <C>
Expenditures on uncompleted contracts....................... $104,882 $184,080
Estimated earnings thereon.................................. 11,148 17,768
-------- --------
116,030 201,848
Less billings applicable thereto............................ 114,715 197,516
-------- --------
$ 1,315 $ 4,332
======== ========
Included in the accompanying combined balance sheets under
the following captions:
Costs and estimated earnings in excess of billings on
uncompleted contracts................................... $ 3,579 $ 8,920
Billings in excess of costs and estimated earnings on
uncompleted contracts................................... (2,264) (4,588)
-------- --------
$ 1,315 $ 4,332
======== ========
</TABLE>

(6) EQUITY IN UNCOMBINED JOINT VENTURE:

The Company has a 50% interest in an uncombined joint venture. The other
partner in the joint venture is Prima Paving Corp. Both the Company and the
co-venturer participate in the project, which is under joint general management.
As of September 30, 1999, the project was substantially complete. The investment
in uncombined joint venture is included in the combined balance sheets under the
caption "Prepaid expenses and other assets". At September 30, 1998 and 1999,
this investment totals $90 and $24, respectively.

(7) RELATED PARTY TRANSACTIONS:

(A) DUE FROM AFFILIATES:

At September 30, 1998 and 1999, the Company had loans receivable from
entities affiliated by common ownership interest in the amount of $0 and $391,
respectively. The loans are noninterest bearing.

(B) LOANS PAYABLE--AFFILIATE:

At September 30, 1998 and 1999, the Company had loans payable to an entity
affiliated by common ownership interest in the amount of $111 and $0,
respectively. The loans are noninterest bearing.

The Company had loans payable to stockholders at September 30, 1998 and 1999
of $119 and $69, respectively. The loans are noninterest bearing.

F-9-11
<PAGE>
FELIX EQUITIES, INC. AND AFFILIATES

NOTES TO COMBINED FINANCIAL STATEMENTS (CONTINUED)

YEARS ENDED SEPTEMBER 30, 1997, 1998 AND 1999

(AMOUNTS IN THOUSANDS, EXCEPT SHARE DATA)

(8) CREDIT FACILITY:

The Company has a line of credit agreement with a bank which provides for
borrowings of up to $7,000. Interest on borrowings is payable at the bank's
prime rate. The line expires on March 31, 2000 at which time all the remaining
principal and interest shall be due. Borrowings are personally guaranteed by
certain stockholders and collateralized by equipment. The agreement contains
certain financial covenants. As of September 30, 1998 and 1999, there were
outstanding borrowings of $0 and $5,468, respectively.

(9) OBLIGATIONS UNDER CAPITAL LEASE:

During the year ended September 30, 1998, certain equipment was being leased
under arrangements which qualified as capital leases which expired June 1998.
The Company exercised the purchase option and these assets were reclassified as
owned equipment during the year ended September 30, 1999.

At September 30, 1999, equipment and real property is being leased under
arrangements which qualify as capital leases expiring through June 2005.

At September 30, 1998 and 1999, assets recorded under capital leases are as
follows:

<TABLE>
<CAPTION>
1998 1999
-------- --------
<S> <C> <C>
Real property............................................... $150 $150
Equipment................................................... 750 750
---- ----
Total equipment and real property......................... 900 900
Less accumulated amortization............................... 16 48
---- ----
Net assets under capital leases............................. $884 $852
==== ====
</TABLE>

Amortization expense on leased equipment for the years ended September 30,
1997, 1998 and 1999 was $22, $40 and $32, respectively.

F-9-12
<PAGE>
FELIX EQUITIES, INC. AND AFFILIATES

NOTES TO COMBINED FINANCIAL STATEMENTS (CONTINUED)

YEARS ENDED SEPTEMBER 30, 1997, 1998 AND 1999

(AMOUNTS IN THOUSANDS, EXCEPT SHARE DATA)

(9) OBLIGATIONS UNDER CAPITAL LEASE: (CONTINUED)
Future minimum lease payments under capital lease obligations together with
the present value of the net minimum lease payments at September 30, 1999 are as
follows:

<TABLE>
<CAPTION>
YEAR ENDING
SEPTEMBER 30, AMOUNT
------------- --------
<S> <C>
2000........................................................ $165
2001........................................................ 168
2002........................................................ 168
2003........................................................ 168
2004........................................................ 168
Thereafter.................................................. 56
----
Total future minimum lease payments....................... 893
Less amount representing interest......................... 191
----
Present value of net minimum lease payments............... 702
Less current portion...................................... 112
----
$590
====
</TABLE>

(10) LONG-TERM DEBT:

<TABLE>
<CAPTION>
1998 1999
-------- --------
<S> <C> <C>
Note payable, to a bank, due in monthly installments of $30,
including interest at 7.05%, through July 1999,
collateralized by equipment............................... $ 330 $ 0
Mortgage payable due in monthly installments of $4, plus
interest at prime plus 1 1/2%, through July 2001,
collateralized by real property........................... 128 83
Notes payable, to a finance company, due in aggregate
monthly installments of $83, including interest ranging
from 4.13% to 8.27%, through July 2002, collateralized by
equipment................................................. -- 1,343
Notes payable, to a former stockholder, due in monthly
installments of $30, including interest at 7.5%, through
October 2003, collateralized by a surety guaranty bond.... 1,500 1,265
Notes payable, to a finance company, due in monthly
installments of $41, including interest at 5.55%, through
August 2003, collateralized by equipment.................. -- 1,735
Notes payable, to a bank, due in aggregate monthly
installments of $64, including interest ranging from 7.0%
to 7.4%, respectively, through September 2000,
collateralized by equipment............................... 1,558 707
------ ------
3,516 5,133
Less current portion........................................ 1,461 2,171
------ ------
$2,055 $2,962
====== ======
</TABLE>

F-9-13
<PAGE>
FELIX EQUITIES, INC. AND AFFILIATES

NOTES TO COMBINED FINANCIAL STATEMENTS (CONTINUED)

YEARS ENDED SEPTEMBER 30, 1997, 1998 AND 1999

(AMOUNTS IN THOUSANDS, EXCEPT SHARE DATA)

(10) LONG-TERM DEBT: (CONTINUED)
At September 30, 1999, aggregate maturities of long-term debt are as
follows:

<TABLE>
<CAPTION>
YEAR ENDING
SEPTEMBER 30, AMOUNT
------------- --------
<S> <C>
2000........................................................ $2,171
2001........................................................ 1,195
2002........................................................ 952
2003........................................................ 785
2004........................................................ 30
------
$5,133
======
</TABLE>

(11) INCOME TAXES:

Felix Equities, Inc., Felix General Contracting Inc., Felix Communications
Corp., Felix Asphalt of Florida, Inc. and Felix Equities of FLA, Inc. have
elected and the stockholders have consented, under the applicable provisions of
the Internal Revenue and New York State Franchise Tax Codes, to have the
Corporations report their income for Federal Corporation and New York State
Franchise Tax purposes as "S" corporations. The stockholders report their
respective shares of the net taxable income or loss in their personal tax
returns. Therefore, no provisions are made for Federal Corporation or New York
State Franchise taxes pertaining to the results of operations attributable to
these companies, except for the New York State tax on S corporations, when
applicable.

(12) STOCKHOLDERS' EQUITY:

The combined financial statements reflect the following capital structures
at September 30, 1998 and 1999:

<TABLE>
<CAPTION>
1998 1999
-------- --------
<S> <C> <C>
FELIX EQUITIES, INC.

Common stock, no par value; 200 shares authorized; 100
shares issued; 85 shares outstanding...................... $ -- $ --
Retained earnings........................................... 1,807 4,650
------ -------
1,807 4,650
Less treasury stock, at cost, 15 shares..................... 420 420
------ -------
Total stockholders' equity................................ 1,387 4,230
------ -------

FELIX INDUSTRIES, INC. AND SUBSIDIARY

Common stock, no par value; 100 shares authorized; 100
shares issued; 85 shares outstanding...................... 251 251
Retained earnings........................................... 8,042 7,877
------ -------
8,293 8,128
Less treasury stock, at cost, 15 shares..................... 1,050 1,050
------ -------
Total stockholders' equity................................ 7,243 7,078
------ -------
</TABLE>

F-9-14
<PAGE>
FELIX EQUITIES, INC. AND AFFILIATES

NOTES TO COMBINED FINANCIAL STATEMENTS (CONTINUED)

YEARS ENDED SEPTEMBER 30, 1997, 1998 AND 1999

(AMOUNTS IN THOUSANDS, EXCEPT SHARE DATA)

(12) STOCKHOLDERS' EQUITY: (CONTINUED)

<TABLE>
<CAPTION>
1998 1999
-------- --------
<S> <C> <C>
FELIX GENERAL CONTRACTING INC.

Common stock, no par value; 200 shares authorized; 10 shares
issued and outstanding.................................... -- --
Deficit..................................................... (146) (147)
------ -------
Total stockholders' deficiency............................ (146) (147)
------ -------

FELIX COMMUNICATIONS CORP.

Common stock, no par value; 200 shares authorized 100 shares
issued; 85 shares outstanding............................. -- --
Retained earnings........................................... 190 182
------ -------
190 182
Less treasury stock, at cost, 15 shares..................... 30 30
------ -------
Total stockholders' equity................................ 160 152
------ -------

FELIX ASPHALT OF FLORIDA, INC.

Common stock, no par value; 1000 shares authorized; 85
shares issued and outstanding............................. -- --
Deficit..................................................... (54) (577)
------ -------
Total stockholders' equity (deficiency)................... (54) (577)
------ -------

FELIX EQUITIES OF FLA., INC.

Common stock, no par value; 1,000 shares authorized; 85
shares issued and outstanding............................. -- --
------ -------
Total stockholders' equity................................ -- --
------ -------
Total combined stockholders' equity....................... $8,590 $10,736
====== =======
</TABLE>

During the year ended September 30, 1998, the Company purchased shares of
common stock from a former stockholder for $1,500.

(13) COMMITMENTS AND CONTINGENCIES:

(A) LITIGATION:

The Company is a defendant in several litigation proceedings for work
performed on various contracts. The Company believes the claims against them are
without merit and intends to defend them vigorously. Outside counsel has advised
the Company that, at the present state of the proceedings, they cannot offer an
opinion as to the probable outcomes of the claims. The amount of loss, if any,
related to these claims cannot be reliably estimated.

The Company is also a defendant in several personal injury claims. The
actions are being defended by the Company's insurance carriers and the ultimate
outcome is uncertain at this time. Management believes that the Company's
insurance coverage is adequate to cover any potential loss as a result of these
claims.

F-9-15
<PAGE>
FELIX EQUITIES, INC. AND AFFILIATES

NOTES TO COMBINED FINANCIAL STATEMENTS (CONTINUED)

YEARS ENDED SEPTEMBER 30, 1997, 1998 AND 1999

(AMOUNTS IN THOUSANDS, EXCEPT SHARE DATA)

(13) COMMITMENTS AND CONTINGENCIES: (CONTINUED)
(B) PERFORMANCE BONDS:

The Company is contingently liable to a surety under a general indemnity
agreement. The Company agrees to indemnify the surety for any payments made on
contracts of suretyship, guaranty or indemnity. Management believes that all
contingent liabilities will be satisfied by the Company's performance on the
specific bonded contracts involved.

The Company leases equipment under noncancelable operating leases expiring
through July 2002. Future minimum lease payments required under the lease
obligations at September 30, 1999 are as follows:

<TABLE>
<CAPTION>
YEAR ENDING
SEPTEMBER 30, AMOUNT
------------- --------
<S> <C>
2000........................................................ $1,864
2001........................................................ 1,709
2002........................................................ 1,332
2003........................................................ 542
------
$5,447
======
</TABLE>

Lease expense charged to operations for the years ended September 30, 1998
and 1999 was approximately $93 and $989, respectively.

(14) CONCENTRATION RISKS:

(A) CONCENTRATION OF CREDIT RISK:

Financial instruments, which potentially expose the Company to
concentrations of credit risk, consist primarily of cash and cash equivalents
and trade accounts and retainage receivables.

The Company maintains its cash and cash equivalents in accounts which exceed
Federally insured limits. The Company limits its credit risk by selecting
financial institutions considered to be highly creditworthy.

Trade accounts and retainage receivables are due from customers located in
the New York metropolitan area and Florida. The Company does not require
collateral in most cases, but may file claims against the construction project
if a default in payment occurs.

(B) LABOR CONCENTRATIONS:

The Company's direct labor is supplied primarily by unions which have
collective bargaining agreements expiring at various times through May 2003.
Although the Company's past experience was favorable with respect to resolving
conflicting demands with these unions, it is always possible that a protracted
conflict may occur which could impact the renewal of the collective bargaining
agreements.

F-9-16
<PAGE>
FELIX EQUITIES, INC. AND AFFILIATES

NOTES TO COMBINED FINANCIAL STATEMENTS (CONTINUED)

YEARS ENDED SEPTEMBER 30, 1997, 1998 AND 1999

(AMOUNTS IN THOUSANDS, EXCEPT SHARE DATA)

(14) CONCENTRATION RISKS: (CONTINUED)
(C) CUSTOMERS:

The Company obtains its work primarily through a competitive bid process.
This may result in the Company earning a substantial portion of its revenue from
relatively few customers in any given year. During the years ended
September 30, 1998 and 1999, the Company earned approximately 30% and 25% of its
revenues from a utility company, respectively.

(15) 401(K) PROFIT-SHARING PLAN:

The Company sponsors a 401(k) Profit-Sharing Plan which covers substantially
all eligible non-union employees. The Company matches employee contributions up
to 4% of the participants annual compensation. For the years ended
September 30, 1997, 1998 and 1999, employer contributions charged to operations
were $100, $116 and $80, respectively.

(16) MULTIEMPLOYER PENSION PLANS:

The Company made contributions during the years ended September 30, 1997,
1998 and 1999 and to multiemployer pension plans that cover its various union
employees. These plans provide benefits based on union members' earnings and
periods of coverage under the respective plans. Contributions were approximately
$1,900, $2,000 and $2,330 for the years ended September 30, 1997, 1998 and 1999,
respectively. However, in the event of plan terminations or company withdrawal
from the plans, the Company may be liable for a portion of the plans' unfunded
vested benefits, the amounts of which, if any, have not been determined.

(17) BACKLOG:

Backlog represents the amount of revenue the Company expects to realize from
work to be performed on uncompleted contracts in progress at the year end and
from contractual agreements on work which has not commenced. Backlog consists of
the following:

<TABLE>
<S> <C>
Estimated revenue to be recognized from:
Uncompleted contracts in progress......................... $ 114,210
Contracts on which work has not commenced................. 50,444
------------
Total................................................... $ 164,654
============
</TABLE>

(18) RECLASSIFICATIONS:

Certain items in the 1997 and 1998 financial statements were reclassified to
conform to the 1999 presentation. The reclassifications had no material effect
on working capital or net income as previously reported.

F-9-17
<PAGE>
FELIX EQUITY INC., AND AFFILIATES

CONDENSED COMBINED BALANCE SHEETS

JUNE 30, 1999 AND 2000

(UNAUDITED)

(IN THOUSANDS)

<TABLE>
<CAPTION>
JUNE 30
-------------------
1999 2000
-------- --------
<S> <C> <C>
ASSETS:
Current assets:
Cash and cash equivalents................................. $ 2,156 $ 1,973
Marketable securities..................................... -- --
Accounts receivable, net of allowance for................. -- --
doubtful accounts....................................... 19,708 25,202
Retainage receivable...................................... 6,494 10,781
Bonds substituted for retainage........................... 2,413 3,642
Cost and estimated earnings in excess of.................. -- --
billings on uncompleted contracts....................... 7,805 14,285
Inventory................................................. -- 173
Prepaid expenses and other current assets................. 250 874
------- -------
Total current assets.................................. 38,826 56,930
------- -------
Property and equipment, net................................. 8,699 11,199
------- -------
Other assets:
Loans receivable--officers................................ 460 21
Due from affiliates....................................... 183 --
Deferred financing costs.................................. 4 2
Deposits.................................................. 174 185
------- -------
Total other assets........................................ 821 208
------- -------
Total assets.............................................. $48,346 $68,337
======= =======
LIABILITIES AND STOCKHOLDERS' EQUITY:
Current liabilities
Note payable--bank........................................ $ 4,000 $ 5,615
Current portion of long-term debt......................... 2,092 1,610
Obligation under capital lease, current................... 108 117
Accounts payable and accrued expenses..................... 17,616 20,660
Billings in excess of costs and estimated earnings on
uncompleted contracts................................... 7,140 4,430
Due to affiliates......................................... -- 10
Retainage payable......................................... 1,833 3,611
Fringe benefits and payroll taxes payable................. 3,320 1,967
Income taxes payable...................................... 3,789 4,321
Accrued loss on uncompleted contracts..................... 259 584
------- -------
Total current liabilities........................... 40,157 42,925
Long-term debt, net of current portion...................... 1,859 2,744
Obligation under capital lease, net of current.............. 692 575
------- -------
Total liabilities................................... 42,708 46,244
------- -------
STOCKHOLDERS' EQUITY:
Common stock.............................................. 251 251
Additional paid in capital................................ -- 625
Retained earnings......................................... 6,887 22,717
------- -------
7,138 23,593
Less: Treasury stock...................................... (1,500) (1,500)
------- -------
Total stockholders equity................................. 5,638 22,093
------- -------
Total liabilities and stockholders' equity................ $48,346 $68,337
======= =======
</TABLE>

See notes to condensed combined financial statements

F-9-18
<PAGE>
FELIX EQUITY INC., AND AFFILIATES

CONDENSED COMBINED STATEMENTS OF OPERATIONS

NINE MONTHS ENDED JUNE 30, 1999 AND 2000

(UNAUDITED)

(IN THOUSANDS)

<TABLE>
<CAPTION>
JUNE 30
-------------------
1999 2000
-------- --------
<S> <C> <C>
Contract revenue............................................ $96,590 $159,979

Cost of revenue............................................. 93,051 139,526
------- --------
Gross profit................................................ 3,539 20,453
General and administrative expenses......................... 7,108 4,925
------- --------
Income (loss) from operations............................... (3,569) 15,528
------- --------
Other income (expense):
Interest income........................................... 119 188
Interest expense.......................................... (358) (824)
Other--net................................................ 69 82
------- --------
(170) (554)
------- --------
Income (loss) before income taxes (benefit)................. (3,739) 14,974
------- --------
Provision (benefit) for income taxes........................ (786) 105
------- --------
Net income (loss)......................................... $(2,953) $ 14,869
======= ========
</TABLE>

See notes to condensed combined financial statements

F-9-19
<PAGE>
FELIX EQUITY INC., AND AFFILIATES

CONDENSED COMBINED STATEMENTS OF CASH FLOWS

NINE MONTHS ENDED JUNE 30, 1999 AND 2000

(UNAUDITED)

(IN THOUSANDS)

<TABLE>
<CAPTION>
JUNE 30
--------------------
1999 2000
-------- ---------
<S> <C> <C>
Cash provided by (used to):
Operating activities:
Contract revenue.......................................... $ 93,208 $ 151,928
Contract costs............................................ (87,582) (139,933)
-------- ---------
Net cash provided by contracts.......................... 5,626 11,995

General and administrative................................ (5,766) (4,962)
Interest received......................................... 119 188
Other, net................................................ 94 8
Interest paid............................................. (358) (824)
Income taxes paid......................................... (154) (196)
-------- ---------
Net cash provided by (used in) operating activities..... (439) 6,209
-------- ---------
Investing activities:
Capital expenditures...................................... (4,217) (2,312)
Proceeds from sale of fixed assets........................ 88 227
Purchase of marketable securities--retainage bonds........ (388) (57)
Proceeds from sale/maturity of marketable
securities--retainage bonds............................. 1,205 587
Advances (to) repayments from affiliates.................. (294) 401
-------- ---------
Net cash used in investing activities................... (3,606) (1,154)
-------- ---------
Financing activities:
Net advances from note payable--bank...................... 4,000 147
Proceeds from issuance of long-term debt.................. 2,197 1,154
Principal payments on long-term debt...................... (1,761) (1,932)
Principal payments on obligations under capital leases.... (53) (11)
Shareholders contributions................................ -- 625
Distributions to shareholders............................. -- (4,138)
Net loan repayments to stockholders....................... (577) (92)
-------- ---------
Net cash provided by (used in) financing activities..... 3,806 (4,247)
-------- ---------
Net increase (decrease) in cash and cash equivalents........ (239) 808
Cash and cash equivalents, beginning of period.............. 2,395 1,165
-------- ---------
Cash and cash equivalents, end of period.................... $ 2,156 $ 1,973
======== =========
</TABLE>

See notes to condensed combined financial statements

F-9-20
<PAGE>
FELIX EQUITY INC., AND AFFILIATES

CONDENSED COMBINED STATEMENTS OF CASH FLOWS

NINE MONTHS ENDED JUNE 30, 1999 AND 2000

(CONCLUDED)

(UNAUDITED)
(IN THOUSANDS)

<TABLE>
<CAPTION>
JUNE 30
-------------------
1999 2000
-------- --------
<S> <C> <C>
Reconciliation of net income (loss) to net cash provided by
(used in) operating activities:
Net income (loss)................................... $(2,953) $14,869
------- -------
Adjustments to reconcile net income (loss) to net cash
provided by (used in) operating activities:
Depreciation and amortization............................... 1,543 1,812
Gain on sale of fixed assets................................ (65) (74)
Changes in assets (increase) decrease:
Accounts receivable....................................... (1,369) 2,079
Retainage receivable...................................... (2,663) (4,609)
Costs and estimated earnings in excess of billings on
uncompleted contracts................................... (4,226) (5,365)
Deferred construction costs............................... 376 533
Prepaid expenses.......................................... 128 (506)
Deposits.................................................. 359 (54)
Changes in liabilities increase (decrease):
Accounts payable and accrued expenses..................... 5,884 (3,036)
Retainage payable......................................... 204 1,454
Deferred revenue.......................................... (1,442) (55)
Billings in excess of costs and estimated earnings on
uncompleted contracts................................... 4,876 (158)
Fringe benefits and payroll taxes payable................. (515) (1,173)
Accrued loss on uncompleted contracts..................... 259 584
Income taxes payable...................................... (835) (92)
------- -------
Total adjustments..................................... 2,514 (8,660)
------- -------
Net cash provided by (used in) operating activities... $ (439) $ 6,209
======= =======
</TABLE>

See notes to condensed combined financial statements

F-9-21
<PAGE>
FELIX EQUITY INC., AND AFFILIATES

NOTES TO CONDENSED COMBINED FINANCIAL STATEMENTS

NINE MONTHS ENDED JUNE 30, 1999 AND 2000

(UNAUDITED)

(1) INTERIM FINANCIAL STATEMENTS:

In the opinion of the Company's management, the accompanying condensed
combined financial statements contain all adjustments (consisting of only
normal recurring accruals) necessary to present fairly the financial
position of the Company as of June 30, 1999 and 2000 and the results of
operations and cash flows for the nine month periods ended June 30, 1999 and
2000. Because of the possible fluctuations in the marketplace in the
construction industry, operating results of the company on a nine month
basis may not be indicative of operating results for the full year.

(2) CONTINGENCIES:

The Company is not aware of any pending or threatened legal proceedings
which could have a material adverse effect on its financial position or
results of operations.

(3) SUBSEQUENT EVENT:

On August 3, 2000, the Company's Stockholders sold their entire ownership
interests to Linc.Net, Inc.

F-9-22
<PAGE>
INDEPENDENT AUDITORS' REPORT

To the Board of Directors
InterCon Construction, Inc.
Madison, Wisconsin

We have audited the accompanying balance sheets of InterCon Construction, Inc.
as of January 2, 1999 and January 1, 2000, and the related statements of income,
changes in components of stockholders' equity, and cash flows for the fiscal
years then ended. These financial statements are the responsibility of the
company's management. Our responsibility is to express an opinion on these
financial statements based on our audit.

We conducted our audits in accordance with auditing standards generally accepted
in the United States. Those standards require that we plan and perform the audit
to obtain reasonable assurance about whether the financial statements are free
of material misstatement. An audit includes examining, on a test basis, evidence
supporting the amounts and disclosures in the financial statements. An audit
also includes assessing the accounting principles used and significant estimates
made by management, as well as evaluating the overall financial statement
presentation. We believe that our audits provide a reasonable basis for our
opinion.

In our opinion, the financial statements referred to above present fairly, in
all material respects, the financial position of InterCon Construction, Inc. as
of January 2, 1999 and January 1, 2000, and the results of its operations and
its cash flows for the fiscal years then ended in conformity with accounting
principles generally accepted in the United States.

VIRCHOW, KRAUSE & COMPANY, LLP

Madison, Wisconsin
February 23, 2000

F-10-1
<PAGE>
INTERCON CONSTRUCTION, INC.

BALANCE SHEETS

JANUARY 2, 1999 AND JANUARY 1, 2000

(AMOUNTS IN THOUSANDS, EXCEPT SHARE DATA)

<TABLE>
<CAPTION>
JANUARY 2, 1999 JANUARY 1, 2000
--------------- ---------------
<S> <C> <C>
ASSETS
CURRENT ASSETS
Cash and cash equivalents................................. $ 571 $ 66
Contracts receivable...................................... 3,460 6,887
Contracts retainage receivable............................ 116 49
Contracts receivable--unbilled............................ 132 70
Other receivable.......................................... -- 37
Inventory................................................. 17 24
Prepaid expenses.......................................... 123 122
------- -------
Total Current Assets.................................... 4,419 7,255
------- -------
NET PROPERTY AND EQUIPMENT.................................. 6,244 8,004
------- -------
OTHER ASSETS................................................ 135 140
------- -------
TOTAL ASSETS.......................................... $10,798 $15,399
======= =======

LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES
Current portion of long-term debt......................... $ 235 $ 1,161
Trade payables............................................ 819 2,001
Retainage payable......................................... -- 215
Accrued wages............................................. 117 115
Accrued benefits.......................................... 355 486
Accrued taxes............................................. 78 72
Other accrued expenses.................................... 28 40
------- -------
Total Current Liabilities............................... 1,632 4,090
------- -------
LONG-TERM DEBT.............................................. 3,668 3,442
------- -------
Total Liabilities....................................... 5,300 7,532
------- -------
STOCKHOLDERS' EQUITY
Common stock (no par value; 10,000 shares authorized, 410
shares issued and outstanding).......................... 412 412
Other comprehensive income................................ 18 16
Retained earnings......................................... 5,068 7,439
------- -------
Total Stockholders' Equity.............................. 5,498 7,867
------- -------
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY............ $10,798 $15,399
======= =======
</TABLE>

See accompanying notes to financial statements.

F-10-2
<PAGE>
INTERCON CONSTRUCTION, INC.

STATEMENTS OF INCOME

FOR THE FISCAL YEARS ENDED JANUARY 2, 1999 AND JANUARY 1, 2000

(AMOUNTS IN THOUSANDS)

<TABLE>
<CAPTION>
JANUARY 2, 1999 JANUARY 1, 2000
--------------- ---------------
<S> <C> <C>
CONTRACT REVENUE EARNED..................................... $24,001 $39,157

COST OF CONTRACT REVENUE EARNED............................. 20,724 32,453
------- -------

Gross Profit............................................ 3,277 6,704

GENERAL AND ADMINISTRATIVE EXPENSES......................... 2,127 2,849
------- -------

Operating Income............................................ 1,150 3,855

OTHER INCOME (EXPENSE)
Interest and dividend income............................ 4 4
Interest expense........................................ (329) (373)
Gain (Loss) on sale of equipment........................ -- 80
------- -------
Other Income (Expense).................................. (325) (289)
------- -------

NET INCOME............................................ $ 825 $ 3,566
======= =======
</TABLE>

See accompanying notes to financial statements.

F-10-3
<PAGE>
INTERCON CONSTRUCTION, INC.

STATEMENTS OF CHANGES IN COMPONENTS OF STOCKHOLDERS' EQUITY

FOR THE FISCAL YEARS ENDED JANUARY 2, 1999 AND JANUARY 1, 2000

(AMOUNTS IN THOUSANDS)

<TABLE>
<CAPTION>
ACCUMULATED
OTHER
COMMON RETAINED COMPREHENSIVE
STOCK EARNINGS INCOME (LOSS) TOTAL
-------- ----------- ------------- -----------
<S> <C> <C> <C> <C>
BALANCES, JANUARY 3, 1998................... $ 412 $ 4,807 $ -- $ 5,219

Comprehensive Income
Net income--fiscal year ended January 2,
1999.................................. -- 825 -- 825
Change in net unrealized gain (loss) on
available for sale securities, net of
reclassification adjustment........... -- -- 18 18
-----------
Total Comprehensive Income............ 843
-----------

Distributions paid--fiscal year ended
January 2, 1999........................... -- (564) -- (564)
-------- ----------- ------- -----------

BALANCES, JANUARY 2, 1999................... 412 5,068 18 5,498

Comprehensive Income
Net income--fiscal year ended January 1,
2000.................................. -- 3,566 -- 3,566
Change in net unrealized gain (loss) on
available for sale securities, net of
reclassification adjustment........... -- -- (2) (2)
-----------
Total Comprehensive Income............ 3,564
-----------

Distributions paid--fiscal year ended
January 1, 2000........................... -- (1,195) -- (1,195)
-------- ----------- ------- -----------

BALANCES, JANUARY 1, 2000................... $ 412 $ 7,439 $ 16 $ 7,867
======== =========== ======= ===========
</TABLE>

See accompanying notes to financial statements.

F-10-4
<PAGE>
INTERCON CONSTRUCTION, INC.

STATEMENTS OF CASH FLOWS

FOR THE FISCAL YEARS ENDED JANUARY 2, 1999 AND JANUARY 1, 2000

(AMOUNTS IN THOUSANDS)

<TABLE>
<CAPTION>
JANUARY 2, 1999 JANUARY 1, 2000
--------------- ---------------
<S> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES
Cash received from customers.............................. $ 23,307 $ 35,816
Cash paid to suppliers and employees...................... (21,155) (32,047)
Interest paid............................................. (329) (369)
Interest and dividends received........................... 4 4
------------ ------------
Net Cash From Operating Activities...................... 1,827 3,404
------------ ------------

CASH FLOWS FROM INVESTING ACTIVITIES
Proceeds from sale of equipment........................... 28 99
Capital expenditures...................................... (1,596) (2,558)
------------ ------------
Net Cash From Investing Activities...................... (1,568) (2,459)
------------ ------------

CASH FLOWS FROM FINANCING ACTIVITIES
Cash used to retire debt.................................. (21,095) (32,130)
Proceeds from issuance of debt............................ 21,923 31,875
Distributions paid........................................ (564) (1,195)
------------ ------------
Net Cash From Financing Activities...................... 264 (1,450)
------------ ------------
NET CHANGE IN CASH AND CASH EQUIVALENTS............... 523 (505)

CASH AND CASH EQUIVALENTS--Beginning of Fiscal Year....... 48 571
------------ ------------

CASH AND CASH EQUIVALENTS--END OF FISCAL YEAR........... $ 571 $ 66
============ ============

RECONCILIATION OF NET INCOME TO NET CASH FROM OPERATING
ACTIVITIES
Net income................................................ $ 825 $ 3,566
Adjustments to reconcile net income to net cash from
operating activities
Noncash items included in income
Depreciation and amortization......................... 1,494 1,733
Increase in cash surrender value of life insurance.... (7) (6)
(Gain) loss on sale of equipment...................... -- (80)

Changes in noncash components of working capital
Change in contracts receivable........................ (783) (3,360)
Change in contracts receivable--unbilled.............. 61 62
Change in other receivables........................... -- (37)
Change in inventory................................... (17) (7)
Change in prepaid expenses............................ (95) 1
Change in trade payables.............................. 281 1,182
Change in retainage payable........................... -- 215
Change in other accrued expenses...................... -- 6
Change in accrued wages and benefits.................. 68 129
------------ ------------

NET CASH FROM OPERATING ACTIVITIES.................. $ 1,827 $ 3,404
============ ============
</TABLE>

See accompanying notes to financial statements.

F-10-5
<PAGE>
INTERCON CONSTRUCTION, INC.

STATEMENTS OF CASH FLOWS (CONTINUED)

FOR THE FISCAL YEARS ENDED JANUARY 2, 1999 AND JANUARY 1, 2000

(AMOUNTS IN THOUSANDS)

NONCASH TRANSACTIONS

During the years ended January 2, 1999 and January 1, 2000, the company
purchased equipment that was financed directly with the equipment dealer
totaling $475 and $954, respectively.

During the year ended January 1, 2000, the company traded equipment and
fleet with an original cost of $146 and accumulated depreciation of $134.

F-10-6
<PAGE>
INTERCON CONSTRUCTION, INC.

NOTES TO FINANCIAL STATEMENTS

JANUARY 2, 1999 AND JANUARY 1, 2000

(AMOUNTS IN THOUSANDS)

NOTE 1--SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

NATURE OF THE BUSINESS

InterCon Construction, Inc. provides network installation services to
telecommunications and public utility industries in the Midwestern United
States, primarily in Wisconsin. The majority of the Company's services includes
projects performed under blanket unit-price contracts in excess of one year.

USE OF ESTIMATES

CASH AND CASH EQUIVALENTS

The Company considers all highly liquid debt instruments purchased with an
initial maturity of three months or less to be cash equivalents.

INVESTMENTS

Marketable equity securities are reported under Statements of Financing
Accounting Standards No. 115 which requires recognition of gains/losses on
securities held for trading purposes as current period earnings and recognition
of gains/losses on securities classified as available for sale as a separate
component to the equity section. The company considers all of their securities
to be available for sale. Marketable equity securities are included in other
assets.

INVENTORY

Inventory consists of materials and supplies. It is valued at the lower of
cost or market using the first-in, first-out method.

PROPERTY AND EQUIPMENT

Property and equipment are stated at cost. Major expenditures for property
and those which substantially increase their useful lives are capitalized.
Maintenance, repairs, and minor renewals are expensed as incurred. When assets
are retired resulting gains or losses are included in income.

DEPRECIATION AND AMORTIZATION

The Company provides for depreciation of property and equipment using annual
rates which are sufficient to amortize the cost of depreciable assets over their
estimated useful lives. The Company uses the straight-line method.

F-10-7
<PAGE>
INTERCON CONSTRUCTION, INC.

NOTES TO FINANCIAL STATEMENTS (CONTINUED)

JANUARY 2, 1999 AND JANUARY 1, 2000

(AMOUNTS IN THOUSANDS)

NOTE 1--SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
Estimated useful lives are detailed as follows:

<TABLE>
<CAPTION>
YEARS
--------
<S> <C>
Fleet....................................................... 5-7
Minor equipment............................................. 5-10
Equipment................................................... 5-10
Office furniture and fixtures............................... 3-10
Leasehold improvements...................................... 20
</TABLE>

FISCAL YEAR

The Company's fiscal year end is on the Saturday closest to December 31. The
fiscal years ended January 2, 1999 and January 1, 2000 are comprised of 52
weeks.

METHOD OF ACCOUNTING FOR LONG-TERM CONSTRUCTION CONTRACTS

The accompanying financial statements have been prepared using the
percentage-of-completion method of accounting and, therefore, take into account
the cost, estimated gross profit and revenue to date on contracts not yet
completed.

The amount of revenue recognized at the statement date is the portion of the
total units of lines installed to date to the anticipated final total units to
be installed on a project. In all circumstances, the revenue recognized is not
related to the progress billings to customers.

Contract costs includes all direct labor and benefits, materials,
subcontract costs, and allocations of indirect construction costs. General and
administrative costs are charged to expense as incurred.

If long-term contracts extend over one or more years, revisions in estimates
of total cost and gross profit during the course of the work are reflected in
the current accounting period.

At the time a loss on a contract becomes known, the entire amount of the
estimated ultimate loss is recognized in the financial statements.

Contracts which are substantially complete are considered closed for
financial statement purposes. Costs and estimated gross profit on contracts in
progress in excess of billings (underbillings) are classified as current assets.
Amounts billed in excess of costs and estimated gross profit on contracts in
progress (overbillings) are classified as current liabilities.

Assets and liabilities related to the long-term contracts are included in
current assets and current liabilities in the accompanying balance sheet, as
they will be liquidated in the normal course of the contract completion,
although this may require more than one year.

ALLOWANCE FOR BAD DEBTS

Contracts receivable have been adjusted for all known uncollectible
accounts. The Company uses the direct write-off method of accounting for
doubtful accounts.

F-10-8
<PAGE>
INTERCON CONSTRUCTION, INC.

NOTES TO FINANCIAL STATEMENTS (CONTINUED)

JANUARY 2, 1999 AND JANUARY 1, 2000

(AMOUNTS IN THOUSANDS)

NOTE 1--SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
INCOME TAXES

The Company with the consent of its stockholders, has elected to be an
S Corporation. In lieu of corporate income taxes, the stockholders of an S
Corporation are taxed on their proportionate share of the company's taxable
income. Therefore, no provision or liability for income taxes has been included.

ADVERTISING

The Company expenses costs of advertising at the time incurred. Advertising
expenses were $41 and $37 for the periods ended January 2, 1999 and January 1,
2000, respectively.

RECLASSIFICATIONS

Certain reclassifications have been made to prior year amounts to conform
with current year presentations. The reclassifications had no effect on net
income.

NOTE 2--NET PROPERTY AND EQUIPMENT

Net property and equipment at the fiscal years ended consists of the
following:

<TABLE>
<CAPTION>
JANUARY 2, JANUARY 1,
1999 2000
----------- -----------
<S> <C> <C>
Fleet.............................................. $ 6,979 $ 8,613
Minor equipment.................................... 336 385
Equipment.......................................... 7,183 8,455
Office furniture and equipment..................... 164 169
Leasehold improvements............................. 55 55
----------- -----------
Total Property and Equipment..................... 14,717 17,677
Less: Accumulated depreciation..................... 8,473 9,673
----------- -----------
Net Property and Equipment....................... $ 6,244 $ 8,004
=========== ===========
</TABLE>

F-10-9
<PAGE>
INTERCON CONSTRUCTION, INC.

NOTES TO FINANCIAL STATEMENTS (CONTINUED)

JANUARY 2, 1999 AND JANUARY 1, 2000

(AMOUNTS IN THOUSANDS)

NOTE 3--MARKETABLE EQUITY SECURITIES

Securities held by the company include only marketable equity securities.
Following is a summary of equity securities classified as available for sale as
of the fiscal years ended January 2, 1999 and January 1, 2000:

<TABLE>
<CAPTION>
1999 2000
-------- --------
<S> <C> <C>
Fair value................................................ $ 46 $ 44
Cost...................................................... 28 28
------- -------
Total Gain.............................................. $ 18 $ 16
======= =======
Gross unrealized holding gains--beginning of year......... $ -- $ 18
Gross unrealized holding gains (losses)--current year..... 18 (2)
------- -------
Net unrealized holding gain--end of year................ $ 18 $ 16
======= =======
</TABLE>

Realized gains and losses are determined on the basis of the average cost of
all shares of such security held at the date of sale. During the fiscal years
ended January 2, 1999 and January 1, 2000, there were no sales of securities
classified as available for sale.

During fiscal years ended January 2, 1999 and January 1, 2000, there were no
gross gains or losses included in operations resulting from transfers of
securities from the available for sale category into the trading category.

Stockholders' equity for January 2, 1999 and January 1, 2000 includes
unrealized holding gain on securities available for sale of $18 and $16,
respectively.

NOTE 4--REVOLVING BUSINESS LOAN

The Company has a $8,500 loan agreement with a bank that expires on
April 30, 2001. The credit limit is the combination of a revolving loans and
term loan options. The loan agreement allows the company to borrow funds as term
loans up to a total of $3,000. The revolving loans have interest payable monthly
and accrues at the bank's prime rate (8.5% at January 1, 2000) and at the LIBOR
rate plus 1.95 percent per annum (8.12% at January 1, 2000). The Company has a
term loan under this agreement as detailed in Note 5.

The Company has outstanding balances on the revolving loans at January 2,
1999 and January 1, 2000 of $3,600 and $1,941, respectively. The note is secured
by equipment (excluding fleet vehicles). The Company is in compliance with all
loan covenants as of January 2, 1999 and January 1, 2000, respectively.

F-10-10
<PAGE>
INTERCON CONSTRUCTION, INC.

NOTES TO FINANCIAL STATEMENTS (CONTINUED)

JANUARY 2, 1999 AND JANUARY 1, 2000

(AMOUNTS IN THOUSANDS)

NOTE 5--LONG-TERM DEBT

The company has the following long-term debt at the fiscal years ended:

<TABLE>
<CAPTION>
JANUARY 2, JANUARY 1,
1999 2000
---------- ----------
<S> <C> <C>
Note payable to bank with monthly installments of $62,
including interest at 7.15%. The note is written as part
of the Revolving Business Loan (see Note 4). The note is
secured by equipment (excluding fleet). Final payment is
due in June 2002.......................................... -- $ 1,694
Notes payable to vendor with monthly installments of $50,
including interest at various rates from 0% to 5.90%. The
notes are secured by construction equipment. Final
payments are due at various dates from April 2000 to July
2002...................................................... 282 801
Note payable to vendor with monthly installments of $4,
including interest at .88%. The note is secured by
construction equipment. The note was paid in full during
the year ended January 1, 2000............................ 21 --
Note payable to vendor with monthly installments of $7,
including interest at 3.01%. The note is secured by
construction equipment. Final payment is due October 25,
2001...................................................... -- 166
-------- ----------
Totals.................................................... 303 2,661
Less: Current portion....................................... 235 1,161
-------- ----------
Long-Term Portion....................................... $ 68 $ 1,500
======== ==========
</TABLE>

Principal requirements on long-term debt and revolving business loans for
the fiscal year ending January 1, 2000 is as follows:

<TABLE>
<S> <C>
December 30, 2000........................................... $ 1,161
December 29, 2001........................................... 3,024
December 28, 2002........................................... 418
----------
Total..................................................... $ 4,603
==========
</TABLE>

NOTE 6--LEASES

The Company leases an office building, shop and equipment yard from a
related party. The related party has the same ownership as the company. The
lease term is for one year beginning on January 1, 2000 and continues in full
force and effect until six (6) months after either party gives notice of
termination. The required monthly payment is $30. The Company is obligated to
pay all taxes, repairs, utilities, insurance and related expenses on the
property.

The Company entered into a lease agreement in October, 1998 for construction
equipment. The lease term is three years with annual installments of $116.

F-10-11
<PAGE>
INTERCON CONSTRUCTION, INC.

NOTES TO FINANCIAL STATEMENTS (CONTINUED)

JANUARY 2, 1999 AND JANUARY 1, 2000

(AMOUNTS IN THOUSANDS)

NOTE 6--LEASES (CONTINUED)
The Company entered into a lease agreement in October, 1998 for construction
equipment. The lease term is five years with semi-annual installments of $64.

The Company entered into a lease agreement in May, 1999 for construction
equipment. The lease term is three years with annual installments of $107.

Total lease expense for the fiscal years ended January 2, 1999 and
January 1, 2000 was $536 and $839, respectively. Lease payments include $141 and
$360 paid to the related party for the fiscal years ended January 2, 1999 and
January 1, 2000, respectively.

Future minimum lease payments are as follows:

<TABLE>
<CAPTION>
JANUARY 1,
2000
----------
<S> <C>
December 30, 2000........................................... $ 711
December 29, 2001........................................... 351
December 28, 2002........................................... 235
January 3, 2004............................................. 68
----------
Total..................................................... $ 1,365
==========
</TABLE>

NOTE 7--RETIREMENT PLAN

The Company has a contributory profit sharing plan covering all employees
who have completed at least two years of service and are not members of a
collective bargaining unit or other labor organization representing a group of
employees of the Company. The Company's contribution to the plan is
discretionary and determined by the board of directors. The Company's
contribution to the plan was $135 and $214 for the fiscal years ended
January 2, 1999 and January 1, 2000, respectively.

NOTE 8--CONCENTRATION OF RISK

The Company maintains cash in bank deposit accounts which, at times, may
exceed federally insured limits. The Company has not experienced any losses in
such accounts. The Company believes they are not exposed to any significant
credit risks.

NOTE 9--PENSION PLANS

The Company's union employees are covered by union-sponsored,
collectively-bargained, multi-employer pension plans. The Company contributed
and charged to expense approximately $981 and $1,230 for the fiscal years ended
January 2, 1999 and January 1, 2000, respectively. These contributions are
determined in accordance with the provisions of negotiated labor contracts and
generally are based on the number of hours worked. Information from the plans'
administrators is not available to permit the company to determine its share of
unfunded vested benefits, if any. The Company has no intention of withdrawing
from any of these plans nor is there any intention to terminate such plans.

F-10-12
<PAGE>
INTERCON CONSTRUCTION, INC.

NOTES TO FINANCIAL STATEMENTS (CONTINUED)

JANUARY 2, 1999 AND JANUARY 1, 2000

(AMOUNTS IN THOUSANDS)

NOTE 10--MAJOR CUSTOMERS

For the fiscal years ended January 2, 1999 and January 1, 2000, the company
had several customers that accounted for more than 10% of the Company's revenue.
Management believes no significant risk is present under these arrangements due
to the strength and longevity of the customers. Revenue percentages from these
customers consisted of the following:

<TABLE>
<CAPTION>
JANUARY 2, JANUARY 1,
1999 2000
---------- ----------
<S> <C> <C>
Customer A.............................................. 22.0% 18.8%
Customer B.............................................. 16.7% 21.2%
Customer C.............................................. 15.5% 12.1%
Customer D.............................................. 13.7% 6.6%
Customer E.............................................. 7.7% 11.9%
</TABLE>

F-10-13
<PAGE>
INDEPENDENT AUDITOR'S REPORT

To the Stockholders
InterCon Construction, Inc.
Madison, Wisconsin

We have audited the accompanying balance sheet of InterCon
Construction, Inc. as of January 3, 1998 and the related statement of income,
stockholders' equity and cash flows for the year then ended. These financial
statements are the responsibility of the Company's management. Our
responsibility is to express an opinion on these financial statements based on
our audit.

We conducted our audit in accordance with auditing standards generally
accepted in the United States. Those standards require that we plan and perform
the audit to obtain reasonable assurance about whether the financial statements
are free of material misstatement. An audit includes examining, on a test basis,
evidence supporting the amounts and disclosures in the financial statements. An
audit also includes assessing the accounting principles used and significant
estimates made by management, as well as evaluating the overall financial
statement presentation. We believe that our audit provides a reasonable basis
for our opinion.

In our opinion, the financial statements referred to above present fairly,
in all material respects, the financial position of InterCon Construction, Inc.
as of January 3, 1998 and the results of its operations and its cash flows for
the year then ended in conformity with accounting principles generally accepted
in the United States.

/s/ McGladrey & Pullen, LLP

Madison, Wisconsin
February 13, 1998

F-10-14
<PAGE>
INTERCON CONSTRUCTION, INC.

BALANCE SHEET

JANUARY 3, 1998

(IN THOUSANDS EXCEPT SHARE DATA)

<TABLE>
<S> <C>
ASSETS

Current Assets
Cash...................................................... $ 48
Contracts receivable...................................... 2,793
Costs in excess of billings on uncompleted contracts...... 193
-------
TOTAL CURRENT ASSETS................................ 3,034
-------

Equipment and Leasehold Improvements........................ 13,200
Less accumulated depreciation and amortization............ 7,505
-------
5,695
-------

Other Assets................................................ 110
-------

$ 8,839
=======

LIABILITIES AND STOCKHOLDERS' EQUITY

Current Liabilities
Accounts payable.......................................... $ 617
Accrued wages............................................. 83
Accrued benefits.......................................... 321
-------
TOTAL CURRENT LIABILITIES........................... 1,021
-------

Note Payable................................................ 2,600
-------

Stockholders' Equity........................................
Common stock, no par value; authorized--10,000 shares;
issued and outstanding 410 shares; at amount paid-in.... 412
Retained earnings........................................... 4,806
-------
5,218
-------

$ 8,839
=======
</TABLE>

See Notes to Financial Statements.

F-10-15
<PAGE>
INTERCON CONSTRUCTION, INC.

STATEMENT OF INCOME

FISCAL YEAR ENDED JANUARY 3, 1998

(IN THOUSANDS)

<TABLE>
<S> <C>
Contract revenues earned.................................... $19,112

Cost of contract revenues earned............................ 15,844
-------

GROSS PROFIT........................................ 3,268

Selling, general and administrative expenses................ 2,164
-------

OPERATING INCOME.................................... 1,104
-------

Other income (expense):.....................................
Interest and dividend income.............................. 3
Interest expense.......................................... (266)
Gain on disposal of equipment............................. 33
-------
(230)
-------

NET INCOME.......................................... $ 874
=======
</TABLE>

See Notes to Financial Statements.

F-10-16
<PAGE>
INTERCON CONSTRUCTION, INC.

STATEMENT OF STOCKHOLDERS' EQUITY

FISCAL YEAR ENDED JANUARY 3, 1998

(IN THOUSANDS)

<TABLE>
<CAPTION>
COMMON STOCK
------------------- RETAINED
SHARES AMOUNT EARNINGS
-------- -------- --------
<S> <C> <C> <C>
Balance, December 28, 1996.................................. 410 $412 $4,697

Net income................................................ -- -- 874
Distribution to shareholders.............................. -- -- (765)
--- ---- ------

Balance, January 3, 1998.................................... 410 $412 $4,806
=== ==== ======
</TABLE>

See Notes to Financial Statements.

F-10-17
<PAGE>
INTERCON CONSTRUCTION, INC.

STATEMENT OF CASH FLOWS

FISCAL YEAR ENDED JANUARY 3, 1998

(IN THOUSANDS)

<TABLE>
<S> <C>
Cash Flows From Operating Activities
Net income................................................ $ 874
Adjustments to reconcile net income to net cash provided
by operating activities:
Depreciation and amortization........................... 1,387
Gain on disposal of equipment........................... (33)
Increase in other assets................................ (15)
Increase (decrease) from changes in:
Contracts receivable.................................. (240)
Costs in excess of billings on uncompleted
contracts............................................ (71)
Prepaid expenses...................................... 127
Accounts payable...................................... 126
Accrued wages......................................... 25
Accrued benefits...................................... 114
--------
NET CASH PROVIDED BY OPERATING ACTIVITIES........... 2,294
--------

Cash Flows From Investing Activities
Purchase of equipment..................................... (2,300)
Proceeds from disposal of equipment....................... 49
--------
NET CASH USED IN INVESTING ACTIVITIES............... (2,251)
--------

Cash Flows From Financing Activities
Distribution to shareholders.............................. (765)
Proceeds from note payable................................ 12,154
Payments on note payable.................................. (11,628)
--------
NET CASH USED IN FINANCING ACTIVITIES............... (239)
--------

NET DECREASE IN CASH................................ (196)

Cash:
Beginning................................................. 244
--------

Ending.................................................... $ 48
========

Supplemental Disclosure of Cash Flow Information
Cash payments for interest................................ $ 280
========
</TABLE>

See Notes to Financial Statements.

F-10-18
<PAGE>
INTERCON CONSTRUCTION, INC.

NOTES TO FINANCIAL STATEMENTS

YEAR ENDED JANUARY 3, 1998

(IN THOUSANDS)

NOTE 1--NATURE OF BUSINESS AND SIGNIFICANT ACCOUNTING POLICIES

NATURE OF BUSINESS: InterCon Construction, Inc. (Company) is engaged
predominantly in serving public utilities in the midwestern United States,
primarily in Wisconsin. The Company provides network installation services to
the telecommunications and public utility industries. The majority of the
Company's services includes projects performed under blanket unit-price
contracts in excess of one year. The remainder is work performed under
individual fixed-fee contracts. Contract revenues earned from four customers
comprised approximately 73 percent of the total revenues earned for the year
ended January 3, 1998.

A summary of the Company's significant accounting policies follows:

FISCAL YEAR: The Company's fiscal year ends on the Saturday nearest
December 31. The fiscal year ended January 3, 1998 is comprised of 53 weeks.

REVENUE AND COST RECOGNITION: Revenues from projects under unit-price
contracts and fixed-fee contracts are recognized on the percentage of completion
method, measured by the total units (feet) of transmission and distribution
lines installed to date to total units to be installed on the project. This
method is used because management considers units installed to be the best
available measure of progress on projects.

Contract costs include all direct material (almost all material is supplied
by the customers) and labor costs and those indirect costs related to project
performance, such as indirect labor, supplies, tools, repairs, and depreciation
and amortization. Selling, general and administrative costs are charged to
expense as incurred. Provisions for estimated losses on uncompleted contracts
are made in the period in which such losses are determined, and claims are
recorded when received. Changes in project performance, project conditions and
estimated profitability may result in revisions to costs and income and are
recognized in the period in which the revisions are determined.

The asset, "costs and estimated earnings on uncompleted contracts,"
represents revenues on projects in process less estimated costs for ground
restoration work to be performed in the spring. Generally, projects are billed
only upon completion of the project, in accordance with contract terms. There
were no billings on uncompleted contracts at January 3, 1998.

FAIR VALUE OF FINANCIAL INSTRUMENTS: The financial statements include the
following financial instruments and the methods and assumptions used in
estimating their fair value: for cash, the carrying amount is fair value; for
accounts receivable and accounts payable, the carrying amounts approximate their
fair values due to the short-term nature of these instruments; and for the note
payable, the carrying amount approximates fair value because the interest rate
fluctuates with the lending banks' prime rate. No separate comparison of fair
values versus carrying value is presented for the aforementioned financial
instruments since their fair values are not significantly different from their
balance sheet carrying amounts. In addition, the aggregate fair values of the
financial instruments would not represent the underlying value of the Company.

EQUIPMENT AND LEASEHOLD IMPROVEMENTS: Equipment and leasehold improvements
are stated at cost. Depreciation of equipment is provided over the estimated
useful lives (5-10 years) of the respective assets,

F-10-19
<PAGE>
INTERCON CONSTRUCTION, INC.

NOTES TO FINANCIAL STATEMENTS (CONTINUED)

YEAR ENDED JANUARY 3, 1998

(IN THOUSANDS)

NOTE 1--NATURE OF BUSINESS AND SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
principally on the straight-line method. Leasehold improvements are amortized
over the shorter of the term of the lease or their estimated useful lives.

USE OF ESTIMATES: The preparation of financial statements requires
management to make estimates and assumptions that affect the amounts reported in
the financial statements and accompanying notes. Actual results could differ
from those estimates.

NOTE 2--EQUIPMENT AND LEASEHOLD IMPROVEMENTS

Equipment and leasehold improvements consist of the following at January 3,
1998:

<TABLE>
<S> <C>
Vehicles.................................................... $ 6,333
Equipment................................................... 6,513
Minor equipment............................................. 314
Office equipment............................................ 35
Leasehold improvements...................................... 5
-----------
13,200
Less accumulated depreciation and amortization.............. 7,505
-----------
$ 5,695
===========
</TABLE>

NOTE 3--NOTE PAYABLE

The Company has a $6,000 master business note agreement with M&I Madison
Bank that expires April 30, 1999. The note is secured by equipment (excluding
fleet). Interest on amounts borrowed against this note is at the bank's prime
rate (8.5 percent at January 3, 1998) or the LIBOR rate plus 2.1 percent fixed
for the period of the specific advance (30-180 days). There are no compensating
balance requirements. The Company had outstanding borrowings against the note of
$2,600 at January 3, 1998. The outstanding borrowings consist of $1,600 at the
bank's prime rate and $1,000 at the LIBOR rate plus 2.1 percent. The entire
unpaid balance at January 3, 1998 is due April 30, 1999.

The note agreement contains various restrictive covenants with respect to
the Company, including maintaining a certain net worth ratio, a certain debt to
equity ratio, and a balance of no more than $3,000 under the maximum credit
limit ($6,000 at January 3, 1998) for a period of 15 consecutive days. The
Company was in compliance with these covenants at January 3, 1998.

At the Company's option, up to $3,000 of the note may be converted to term
loan(s) of three years or less. Interest on term loan(s) is at the bank's prime
rate floating or the average three-year treasury plus 2.35 percent fixed for the
term of the loan (Company's option). Collateral on the term loan(s) is the same
as the line of credit. There were no outstanding term loans at January 3, 1998.

NOTE 4--PROFIT SHARING PLAN

F-10-20
<PAGE>
INTERCON CONSTRUCTION, INC.

NOTES TO FINANCIAL STATEMENTS (CONTINUED)

YEAR ENDED JANUARY 3, 1998

(IN THOUSANDS)

NOTE 4--PROFIT SHARING PLAN (CONTINUED)
representing a group of employees of the Company. The Company's contribution to
the plan is discretionary and determined by the Board of Directors. The
Company's contribution to the plan was approximately $176 for the fiscal year
ended January 3, 1998.

NOTE 5--PENSION PLANS

The Company's union employees are covered by union-sponsored,
collectively-bargained, multi-employer pension plans. The Company contributed
and charged to expense approximately $794 for the fiscal year ended January 3,
1998. These contributions are determined in accordance with the provisions of
negotiated labor contracts and generally are based on the number of hours
worked. Information from the plans' administrators is not available to permit
the Company to determine its share of unfunded vested benefits, if any. The
Company has no intention of withdrawing from any of these plans nor is there any
intention to terminate such plans.

NOTE 6--OPERATING LEASES AND RELATED PARTY TRANSACTIONS

The Company entered into a four-year lease in January 1996 for a directional
boring machine. The lease payments are $215 annually through January 2000.

The Company leased its building through October 2, 1997 from Capital City
Leasing (a Wisconsin general partnership), whose partners are also the Company's
stockholders. The Company was responsible for property taxes, insurance and
repairs. On October 2, 1997, Capital City Leasing sold the building and the
Company entered into a lease agreement with the new owners of the building. The
new lease requires rental payments of $6 per month plus real estate taxes. The
lease expires April 30, 1998 with a Company option to extend the lease through
May 31, 1998. Capital City Leasing is constructing a new building into which the
Company intends move to when the current building lease expires. Beginning in
October 1997, the Company entered into a lease with Capital City Leasing to rent
land to store equipment. This lease required rental payments of $7 per month
until the new building is completed in April 1998. The rent of the new building
is estimated to be $13 per month when completed.

Total rent expense on the above agreements for the years ended January 3,
1998 was approximately $454 including amounts to Capital City Leasing of
approximately $80 and real estate taxes of approximately $12 for the year ended
January 3, 1998. Future minimum lease payments are $267 for 1998 and $215 for
1999.

NOTE 7--INCOME TAX STATUS

The Company, with the consent of its stockholders, has elected to be taxed
under sections of federal and Wisconsin income tax law which provide that, in
lieu of corporation income taxes, the stockholders separately account for their
pro rata shares of the Company's items of income, deductions, losses and
credits. As a result of this election, no income taxes have been recognized in
the accompanying financial statements. As of January 3, 1998, the Company's
reported net fixed assets exceed their tax bases by approximately $2,400.
Accordingly, if the election was terminated on that date, a deferred tax
liability of approximately $936 would be recognized by a charge to income tax
expense.

F-10-21
<PAGE>
INTERCON CONSTRUCTION, INC.

NOTES TO FINANCIAL STATEMENTS (CONTINUED)

YEAR ENDED JANUARY 3, 1998

(IN THOUSANDS)

NOTE 8--SUBSEQUENT CASH DISTRIBUTIONS

The Company made cash distributions to shareholders totaling $200 subsequent
to the balance sheet date to assist the shareholders in paying their personal
income taxes on the income of the Company.

F-10-22
<PAGE>
INTERCON CONSTRUCTION, INC. AND SUBSIDIARY

CONDENSED CONSOLIDATED BALANCE SHEETS

JUNE 30, 1999 AND 2000

UNAUDITED

(IN THOUSANDS)

<TABLE>
<CAPTION>
JUNE 30
-------------------
1999 2000
-------- --------
<S> <C> <C>
ASSETS
CURRENT ASSETS
Cash and cash equivalents................................. $ 217 $ 27
Contracts receivable...................................... 5,305 8,721
Contracts retainage receivable............................ 8 264
Contracts receivable--unbilled............................ 665 592
Inventory................................................. 17 582
Prepaid expenses.......................................... 119 71
------- -------
Total Current Assets.................................... 6,331 10,257
------- -------

NET PROPERTY AND EQUIPMENT.................................. 7,241 10,902
------- -------

OTHER ASSETS................................................ 135 95
------- -------

TOTAL ASSETS.......................................... $13,707 $21,254
======= =======

LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES
Current portion of long-term debt......................... $ 805 $ 554
Excess of outstanding checks over bank balance............ 150 481
Trade payables............................................ 742 841
Retainage payable......................................... 6 312
Accrued payroll........................................... 666 622
Accrued benefits.......................................... 442 536
Other accrued expenses.................................... 134 149
------- -------
Total Current Liabilities............................... 2,945 3,495
------- -------

LONG-TERM DEBT.............................................. 5,497 9,880
------- -------

Total Liabilities..................................... 8,442 13,375
------- -------
STOCKHOLDERS' EQUITY
Common stock (no par value; 10,000 shares authorized,
410 shares issued and outstanding....................... 412 412
Other comprehensive income................................ 18 --
Retained earnings......................................... 4,835 7,467
------- -------
Total Stockholders' Equity.............................. 5,265 7,879
------- -------

TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY............ $13,707 $21,254
======= =======
</TABLE>

See accompanying notes to condensed consolidated financial statements.

F-10-23
<PAGE>
INTERCON CONSTRUCTION, INC. AND SUBSIDIARY

CONDENSED CONSOLIDATED STATEMENTS OF INCOME

FOR THE SIX MONTHS ENDED JUNE 30, 1999 AND 2000

(UNAUDITED)

(IN THOUSANDS)

<TABLE>
<CAPTION>
SIX MONTHS ENDED
JUNE 30
-------------------
1999 2000
-------- --------
<S> <C> <C>
CONTRACT REVENUE EARNED..................................... $13,411 $20,690
COST OF CONTRACT REVENUE EARNED............................. 11,521 17,074
------- -------
Gross Profit............................................ 1,890 3,616

SELLING, GENERAL AND ADMINISTRATIVE EXPENSES................ 1,499 1,696
------- -------
Operating Income........................................ 391 1,920

OTHER INCOME (EXPENSE)
Interest and dividend income.............................. 1 2
Interest expense.......................................... (175) (226)
Gain on sale of equipment................................. 70 88
Gain on sale of marketable equity securities.............. -- 18
------- -------
Other Income (Expense).................................. (104) (118)
------- -------

NET INCOME............................................ $ 287 $ 1,802
======= =======
</TABLE>

See accompanying notes to condensed consolidated financial statements.

F-10-24
<PAGE>
INTERCON CONSTRUCTION, INC. AND SUBSIDIARY

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

FOR THE SIX MONTHS ENDED JUNE 30, 1999 AND 2000

(UNAUDITED)

(IN THOUSANDS)

<TABLE>
<CAPTION>
SIX MONTHS
ENDED JUNE 30
-------------------
1999 2000
-------- --------
<S> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES
Cash received from customers.............................. 11,142 18,156
Cash paid to suppliers and employees...................... (11,661) (18,848)
Interest paid............................................. (199) (255)
Interest and dividends received........................... -- 1
------- -------
Net Cash From Operating Activities...................... (718) (946)
------- -------
CASH FLOWS FROM INVESTING ACTIVITIES
Proceeds from sale of equipment........................... 90 96
Capital expenditures...................................... (1,600) (3,120)
Proceeds from sale of marketable equity securities........ -- 46
------- -------
Net Cash From Investing Activities...................... (1,510) (2,978)
------- -------
CASH FLOWS FROM FINANCING ACTIVITIES
Net proceeds (payments) from debt........................... 2,244 5,178
Increase in checks issued over bank balance................. 150 481
Distributions paid.......................................... (520) (1,774)
------- -------
Net Cash From Financing Activities.......................... 1,874 3,885
------- -------
NET CHANGE IN CASH AND CASH EQUIVALENTS..................... (354) (39)
CASH AND CASH EQUIVALENTS--BEGINNING OF PERIOD.............. 571 66
------- -------
CASH AND CASH EQUIVALENTS--END OF PERIOD.................... 217 27
======= =======
RECONCILIATION OF NET INCOME TO NET CASH FROM OPERATING
ACTIVITIES
Net Income................................................ $ 287 $ 1,802
Adjustments to reconcile net income to net cash from
operating activities
Noncash items included in income
Depreciation.......................................... 739 869
(Gain) on sale of equipment........................... (70) (89)
(Gain) on sale of marketable equity securities........ -- (18)
Changes in noncash components of working capital
Contracts receivable.................................. (1,844) (1,834)
Contracts retainage receivable........................ 108 (215)
Contracts receivable-unbilled......................... (533) (522)
Other receivables..................................... -- 37
Inventory............................................. -- (558)
Prepaid expenses...................................... 2 52
Trade payables........................................ (77) (1,160)
Retainage payable..................................... 6 97
Other accrued expenses................................ 28 562
Accrued payroll and benefits.......................... 636 31
------- -------
NET CASH FROM OPERATING ACTIVITIES.................. $ (718) $ (946)
======= =======
</TABLE>

NONCASH TRANSACTIONS

During the six months ended June 30, 1999 and June 30, 2000, the company
purchased equipment that was financed directly with an equipment dealer totaling
$154 and $654, respectively.

During the six months ended June 30, 2000, the company traded equipment and
fleet with cost and accumulated depreciation of $175 and $39, respectively.

See accompanying notes to Condensed Consolidated Financial Statements.

F-10-25
<PAGE>
INTERCON CONSTRUCTION, INC. AND SUBSIDIARY

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

JUNE 30, 1999 AND 2000

(UNAUDITED)

NOTE 1--ORGANIZATION

InterCon Construction, Inc. was incorporated under Wisconsin law and is
primarily involved as a network infrastructure installation services provider.

NOTE 2--ACCOUNTING POLICIES

BASIS OF PRESENTATION

The accompanying unaudited condensed consolidated financial statements have
been prepared in accordance with generally accepted accounting principles for
interim financial information. Accordingly, they do not include all of the
information and footnotes required by generally accepted accounting principles
for complete financial statements. In the opinion of management of the Company,
all adjustments necessary to present fairly the financial position as of
June 30, 1999 and 2000 and the results of operations and cash flows for the six
months ended June 30, 1999 and 2000 have been made. Such adjustments consisted
only of normal recurring items. Operating results for the period ended June 30,
2000 are not necessarily indicative of the results that may be expected for the
year ended December 30, 2000. Certain information and footnote disclosures
normally included in financial statements prepared in accordance with generally
accepted accounting principles have been condensed or omitted. The accounting
policies followed by the Company are set forth in Note 1 to the Company's
financial statements contained in the Company's January 2, 1999 and January 1,
2000 annual audit report. For further information, refer to the financial
statements and footnotes thereto included in the Company's annual audit report
for the years ended January 2, 1999 and January 1, 2000.

PRINCIPLES OF CONSOLIDATION

The consolidated financial statements as of and for the periods presented
include the accounts of the Company and InterCon Trucking, Inc., its wholly
owned subsidiary. All significant intercompany accounts and transactions have
been eliminated in the consolidated financial statements.

F-10-26
<PAGE>
[LOGO]
<PAGE>
PART II

INFORMATION NOT REQUIRED IN PROSPECTUS

ITEM 13. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION.

The following is a statement of estimated expenses, to be paid solely by
Linc.net, of the issuance and distribution of the securities being registered
hereby:

<TABLE>
<S> <C>
Securities and Exchange Commission registration fee......... $19,800
NASD filing fee........................................... 8,000
New York Stock Exchange listing fee....................... *
Blue Sky fees and expenses (including attorneys' fees and
expenses)............................................... *
Printing expenses......................................... *
Accounting fees and expenses.............................. *
Transfer agent's fees and expenses........................ *
Legal fees and expenses................................... *
Miscellaneous expenses.................................... *
--------
Total................................................... $ *
========
</TABLE>

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

* To be provided by Amendment.

ITEM 14. INDEMNIFICATION OF DIRECTORS AND OFFICERS.

GENERAL CORPORATION LAW

We are incorporated under the laws of the State of Delaware. Section 145
("Section 145") of the General Corporation Law of the State of Delaware, as the
same exists or may hereafter be amended (the "General Corporation Law"), INTER
ALIA, provides that a Delaware corporation may indemnify any persons who were,
are or are threatened to be made, parties to any threatened, pending or
completed action, suit or proceeding, whether civil, criminal, administrative or
investigative (other than an action by or in the right of such corporation), by
reason of the fact that such person is or was an officer, director, employee or
agent of such corporation, or is or was serving at the request of such
corporation as a director, officer, employee or agent of another corporation or
enterprise. The indemnity may include expenses (including attorneys' fees),
judgments, fines and amounts paid in settlement actually and reasonably incurred
by such person in connection with such action, suit or proceeding, provided such
person acted in good faith and in a manner he reasonably believed to be in or
not opposed to the corporation's best interests and, with respect to any
criminal action or proceeding, had no reasonable cause to believe that his
conduct was illegal. A Delaware corporation may indemnify any persons who are,
were or are threatened to be made, a party to any threatened, pending or
completed action or suit by or in the right of the corporation by reasons of the
fact that such person was a director, officer, employee or agent of such
corporation, or is or was serving at the request of such corporation as a
director, officer, employee or agent of another corporation or enterprise. The
indemnity may include expenses (including attorneys' fees) actually and
reasonably incurred by such person in connection with the defense or settlement
of such action or suit, provided such person acted in good faith and in a manner
he reasonably believed to be in or not opposed to the corporation's best
interests, provided that no indemnification is permitted without judicial
approval if the officer, director, employee or agent is adjudged to be liable to
the corporation. Where an officer, director, employee or agent is successful on
the merits or otherwise in the defense of any action referred to above, the
corporation must indemnify him against the expenses which such officer or
director has actually and reasonably incurred.

II-1
<PAGE>
Section 145 further authorizes a corporation to purchase and maintain
insurance on behalf of any person who is or was a director, officer, employee or
agent of the corporation, or is or was serving at the request of the corporation
as a director, officer, employee or agent of another corporation or enterprise,
against any liability asserted against him and incurred by him in any such
capacity, arising out of his status as such, whether or not the corporation
would otherwise have the power to indemnify him under Section 145.

CERTIFICATE OF INCORPORATION AND BY-LAWS

Our Certificate of Incorporation and By-laws provides for the
indemnification of officers and directors to the fullest extent permitted by the
General Corporation Law of the State of Delaware.

ITEM 15. RECENT SALES OF UNREGISTERED SECURITIES.

During the last three years, Linc.net has issued the following securities
without registration under the Securities Act of 1933 as amended (the
"Securities Act"):

On October 19, 1999, Linc.net, LLC, which is owned by Banc One Equity
Capital (formerly known as First Chicago Equity Capital), certain of its
affiliates and Carlisle Enterprises, LLC and its affiliates ("BOEC LLC"), and
certain members of management purchased a total of 8,710.964 shares of Series A
Mandatorily Redeemable Preferred Stock for $1,000.00 per share and 96,788.500
shares of Common Stock for $10.00 per share for an aggregate purchase price of
$9,678,850.

On December 21, 1999, Linc.net, LLC, SKM Linc.net, LLC, which is owned by
certain affiliates of SKM and Carlisle Enterprises, LLC and its affiliates ("SKM
LLC"), PNC Equities Corp., Heller Financial, Inc., Randolph Street Partners,
Randolph Street Partners 1998 DIF, LLC, affiliates of Gateway Partners and
certain members of management purchased a total of 28,554.171 shares of
Series A Mandatorily Redeemable Preferred Stock for $1,000.00 per share and
342,268.570 shares of Common Stock for $10.00 per share for an aggregate
purchase price of $31,976,857.00.

On January 21, 2000, BOEC LLC, SKM LLC and certain members of management
purchased a total of 2,193.316 shares of Series A Mandatorily Redeemable
Preferred Stock for $1,000.00 per share and 24,370.182 shares of Common Stock
for $10.00 per share for an aggregate purchase price of $2,437,018.26.

On February 11, 2000, a certain member of management purchased a total of
112.500 shares of Series A Mandatorily Redeemable Preferred Stock for $1,000.00
per share 2,500.000 shares of Common Stock for $10.00 per share for an aggregate
purchase price of $137,500.00.

On March 6, 2000, an affiliate of Gateway Partners purchased a total of
22.500 shares of Series A Mandatorily Redeemable Preferred Stock for $1,000.00
per share and 250.000 shares of Common Stock for $10.00 per share for an
aggregate purchase price of $25,000.00.

On March 13, 2000, BOEC LLC, SKM LLC, certain members of management and an
affiliate of Gateway Partners purchased a total of 17,985.080 shares of
Series A Mandatorily Redeemable Preferred Stock for $1,000.00 per share and
224,834.214 shares of Common Stock for $10.00 per share for an aggregate
purchase price of $20,233,421.46.

On May 2, 2000, BOEC LLC, SKM LLC and certain members of management
purchased a total of 6,414.416 shares of Series A Mandatorily Redeemable
Preferred Stock for $1,000.00 per share and 71,271.280 shares of Common Stock
for $10.00 per share for an aggregate purchase price of $7,127,127.94.

On May 8, 2000, BOEC LLC, SKM LLC, PNC Equities Corp., and certain members
of management purchased a total of 9,053.286 shares of Series A Mandatorily
Redeemable Preferred Stock for $1,000.00 per share and 100,592.066 shares of
Common Stock for $10.00 per share for an aggregate purchase price of
$10,059,206.70.

II-2
<PAGE>
On May 10, 2000, BOEC LLC, SKM LLC and certain members of management
purchased a total of 1,302.750 shares of Series A Mandatorily Redeemable
Preferred Stock for $1,000.00 per share and 14,475.000 shares of Common Stock
for $10.00 per share for an aggregate purchase price of $1,447,500.00.

On May 22, 2000, certain members of management purchased a total of 135.000
shares of Series A Mandatorily Redeemable Preferred Stock for $1,000.00 per
share and 4,000.000 shares of Common Stock for $10.00 per share for an aggregate
purchase price of $175,000.00.

On June 16, 2000, BOEC LLC, SKM LLC, Randolph Street Partners, Randolph
Street Partners 1998 DIF, LLC, and certain members of management purchased a
total of 7,214.206 shares of Series A Mandatorily Redeemable Preferred Stock for
$1,000.00 per share and 80,157.844 shares of Common Stock for $10.00 per share
for an aggregate purchase price of $8,015,784.40.

On August 3, 2000, BOEC LLC, SKM LLC, the Semir D. Sirazi Revocable Trust
dated July 14, 1999, William Antle and certain members of management purchased a
total of 30,119.192 shares of Series A Mandatorily Redeemable Preferred Stock
for $1,000.00 per share and 334,657.696 shares of Common Stock for $10.00 per
share for an aggregate purchase price of $33,465,769.60.

On August 18, 2000, a certain member of management purchased a total of
270.000 shares of Series A Mandatorily Redeemable Preferred Stock for $1,000.00
per share and 10,500.000 shares of Common Stock for $10.00 per share for an
aggregate purchase price of $375,000.00.

On August 24, 2000, a certain member of management purchased a total of
72.000 shares of Series A Mandatorily Redeemable Preferred Stock for $1,000.00
per share and 2,675.000 shares of Common Stock for $10.00 per share for an
aggregate purchase price of $98,750.00.

On August 28, 2000, a certain member of management purchased a total of
90.000 shares of Series A Mandatorily Redeemable Preferred Stock for $1,000.00
per share and 2,250.000 shares of Common Stock for $10.00 per share for an
aggregate purchase price of $112,500.00.

The sales and issuances listed above were deemed exempt from registration
under the Securities Act by virtue of Section 4(2), as transactions not
involving a public offering, and Rule 701 thereunder. Certain defined terms used
herein not otherwise defined have the meanings ascribed to them in the
prospectus, which forms a part of this registration statement.

ITEM 16. EXHIBITS AND FINANCIAL STATEMENT SCHEDULES.

(A) EXHIBITS.

Reference is made to the attached Exhibit Index.

(B) FINANCIAL STATEMENT SCHEDULES.

The following financial statement schedules are included in this
registration statement:

SCHEDULE II VALUATION AND QUALIFYING ACCOUNTS

All other schedules for which provision is made in the applicable accounting
regulations of the Commission are not required under the related instructions,
are inapplicable or not material, or the information called for thereby is
otherwise included in the financial statements and therefore has been omitted.

ITEM 17. UNDERTAKINGS.

The undersigned registrant hereby undertakes to provide to the underwriter
at the closing specified in the underwriting agreement certificates in such
denominations and registered in such names as required by the underwriter to
permit prompt delivery to each purchaser.

II-3
<PAGE>
The undersigned registrant hereby undertakes:

(1) For purposes of determining any liability under the Securities Act of
1933 (the "Securities Act"), the information omitted from the form of
prospectus filed as part of this registration statement in reliance upon
Rule 430A and contained in a form of prospectus filed by the registrants
pursuant to Rule 424(b)(1) or (4) or 497(h) under the Securities Act
shall be deemed to be part of this registration statement as of the time
it was declared effective.

(2) For the purpose of determining any liability under the Securities Act,
each post-effective amendment that contains a form of prospectus shall be
deemed to be a new registration statement relating to the securities
offered therein, and the offering of such securities at that time shall
be deemed to be the initial bona fide offering thereof.

Insofar as indemnification for liabilities arising under the Securities Act
may be permitted to directors, officers and controlling persons of the
registrants pursuant to the provisions described under Item 20 or otherwise, the
registrants have been advised that in the opinion of the Securities and Exchange
Commission such indemnification is against public policy as expressed in the
Securities Act and is, therefore, unenforceable. In the event that a claim for
indemnification against such liabilities (other than the payment by the
registrants of expenses incurred or paid by a director, officer or controlling
person of the registrants in the successful defense of any action, suit or
proceeding) is asserted by such director, officer or controlling person in
connection with the securities being registered, the registrants will, unless in
the opinion of their counsel the matter has been settled by controlling
precedent, submit to a court of appropriate jurisdiction the question whether
such indemnification by it is against public policy as expressed in the
Securities Act and will be governed by the final adjudication of such issue.

II-4
<PAGE>
SIGNATURES

Pursuant to the requirements of the Securities Act of 1933, Linc.net, Inc.
has duly caused this Registration Statement on Form S-1 to be signed on its
behalf by the undersigned, thereunto duly authorized, in the City of Miami,
State of Florida, on September 11, 2000.

<TABLE>
<S> <C>
LINC.NET, INC.

By: /s/ ISMAEL PERERA
--------------------------------------------
Ismael Perera
PRESIDENT AND CHIEF EXECUTIVE OFFICER
</TABLE>

POWER OF ATTORNEY

KNOW ALL MEN BY THESE PRESENTS, that each person whose signature appears
below constitutes and appoints Ismael Perera, Daniel Harrington and Emilio
Alfonso and each of them, his true and lawful attorneys-in-fact and agents, with
full power of substitution and resubstitution, for him and in his name, place
and stead, in any and all capacities, to sign any or all amendments (including
post-effective amendments) to this registration statement (and any registration
statement filed pursuant to Rule 462(b) under the Securities Act of 1933, as
amended, for the offering which this Registration Statement relates), and to
file the same, with all exhibits thereto, and other documents in connection
therewith, with the Securities and Exchange Commission, granting unto said
attorneys-in-fact and agents, and each of them, full power and authority to do
and perform each and every act and thing requisite and necessary to be done in
and about the premises, as fully to all intents and purposes as he might or
could do in person, hereby ratifying and confirming all that said
attorneys-in-fact and agents or any of them, or their or his substitute or
substitutes, may lawfully do or cause to be done by virtue hereof.

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

Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement on Form S-1 and Power of Attorney have been signed by the
following persons in the capacities and on the dates indicated:

<TABLE>
<CAPTION>
SIGNATURES CAPACITY DATES
---------- -------- -----
<S> <C> <C>
/s/ ISMAEL PERERA President and Chief Executive September 11, 2000
---------------------------------- Officer,
Ismael Perera Director (Principal Executive
Officer)

/s/ DANIEL F. HARRINGTON Chief Financial Officer (Principal September 11, 2000
---------------------------------- Financial and Accounting Officer)
Daniel F. Harrington

/s/ BURTON E. MCGILLIVRAY
---------------------------------- Chairman of the Board September 11, 2000
Burton E. McGillivray

/s/ WILLIAM S. ANTLE
---------------------------------- Director September 11, 2000
William S. Antle
</TABLE>

II-5
<PAGE>

<TABLE>
<CAPTION>
SIGNATURES CAPACITY DATES
---------- -------- -----
<S> <C> <C>
/s/ TIMOTHY B. ARMSTRONG
---------------------------------- Director September 11, 2000
Timothy B. Armstrong

/s/ DEBORAH CLARK
---------------------------------- Director September 11, 2000
Deborah Clark

/s/ RICHARD W. DETWEILER, JR.
---------------------------------- Director September 11, 2000
Richard W. Detweiler, Jr.

/s/ JOHN F. MEGRUE, JR.
---------------------------------- Director September 11, 2000
John F. Megrue, Jr.

/s/ PAUL L. WHITING, JR.
---------------------------------- Director September 11, 2000
Paul L. Whiting, Jr.
</TABLE>

II-6
<PAGE>
EXHIBIT INDEX

<TABLE>
<CAPTION>
EXHIBIT
NO. DESCRIPTION
------- ------------------------------------------------------------
<C> <S>
**1.1 Form of Underwriting Agreement.

**2.1 Stock Purchase Agreement dated October 19, 1999 by and among
Linc.net and Capital Land Services, Inc., Patrick L. Adams
1997 Revocable Trust, Patrick L. Adams and CLS Acquisition
Corp.+

**2.2 Stock Purchase Agreement dated December 21, 1999 by and
among Linc.net and C&B Associates, Ltd., C&B Associates II,
Ltd., the sellers named therein, Linc.net Acquisition Corp.,
and Linc.net Acquisition Corp. II, as amended.+

**2.3 Stock Purchase Agreement dated December 21, 1999 by and
among Linc.net, Muller & Pribyl Utilities, Inc., M&P
Utilities, Inc., the sellers named therein, Linc.net and
Linc.net Acquisition Corp.+

**2.4 Stock Purchase Agreement dated January 21, 2000 by and among
Linc.net, North Shore Cable Contractors, Inc. and the
sellers named therein.+

**2.5 Stock Purchase Agreement dated March 13, 2000 by and among
Linc.net, Telpro Technologies, Inc. and the sellers named
therein.+

**2.6 Stock Purchase Agreement dated May 2, 2000 by and among
Linc.net, George M. Construction, Inc. and Thomas E.
Murrell.+

**2.7 Stock Purchase Agreement dated May 8, 2000 by and among
Linc.net Acquisition Corp, Utility Consultants, Inc., Irvin
Gunter, and Ronald Lipham.+

**2.8 Asset Purchase Agreement dated May 10, 2000 by and among
Linc.net, Communicor Corporation--USA, Communicor
Telecommunications, Inc. and the sellers named therein.+

**2.9 Merger Agreement dated May 10, 2000 by and among Linc.net,
Communications Construction Corporation, the seller named
therein and Linc.net Acquisition Corp. III.+

**2.10 Merger Agreement dated May 10, 2000 by and among Linc.net,
Char Stan, Inc., the seller named therein and Linc.net
Acquisition Corp. IV.+

**2.11 Stock Purchase Agreement dated August 3, 2000 by and among
Felix Industries, Inc., Felix Equities, Inc., Felix Equities
of Fla. Inc., the sellers named therein and Linc.net
Acquisition Corp. III.+

**2.12 Stock Purchase Agreement dated August 31, 2000, as amended
on September 11, 2000, by and among InterCon Construction,
Inc., the sellers named therein and Linc.net Acquisition
Corp. III.+

**3.1 Amended and Restated Certificate of Incorporation of
Linc.net.

**3.2 Amended and Restated By-Laws of Linc.net.

**4.1 Amended and Restated Credit Agreement, as amended on
June 16, 2000, by and among Linc.net, the banks named
therein, the guarantors, PNC Bank, National Association,
General Electric Capital Corporation and PNC Capital
Markets, Inc.

**4.2 Form of certificate representing shares of Common Stock.

**5.1 Opinion of Kirkland & Ellis.

**10.1 Amended and Restated Stockholders Agreement by and between
Linc.net and certain stockholders named therein.

**10.2 Form of Linc.net, Inc. 2000 Long-Term Equity Incentive Plan.

**10.3 Employment Agreement dated October 19, 1999 by and between
Linc.net and Ismael Perera.
</TABLE>

II-7
<PAGE>

<TABLE>
<CAPTION>
EXHIBIT
NO. DESCRIPTION
------- ------------------------------------------------------------
<C> <S>
**10.4 Employment Agreement dated May 22, 2000 by and between
Linc.net and Emilio Alfonso.

**10.5 Employment Agreement dated May 8, 2000 by and between
Linc.net and Daniel F. Harrington.

**10.6 Form of Executive Stock Purchase Agreement.

**10.7 Form of Executive Stock Purchase Agreement
(Incentive--TARSAP Vesting).

**10.8 Form of Executive Stock Purchase Agreement (Incentive--Time
Vesting).

**10.9 Form of Executive Stock Purchase Agreement (Investor).

**10.10 Amended and Restated Registration Agreement dated June 12,
2000 by and between Linc.net and certain stockholders named
therein.

**10.11 Stockholders Agreement dated September , 2000 by and
between Linc.net, LLC and SKM Linc.net, LLC.

**11.1 Statement Regarding Computation of Earnings Per Share.

**21.1 Subsidiaries of Linc.net.

23.1 Consent of Ernst & Young LLP relating to the consolidated
financial statements of Linc.net, Inc., Combined M&P
Utilities and Muller & Pribyl Utilities, Inc., Capital Land
Services, Inc., Combined C&B Associates, Ltd. and C&B
Associates II, Inc., North Shore Cable Contractors, Inc.,
Telpro Technologies, Inc., and Craig Enterprises, Inc.

23.2 Consent of Crawford, Carter, Thompson & Barron, L.L.P.
relating to the financial statements of C&B Associates, Ltd.
(formerly C&B Associates, Inc.) and C&B Associates II, Ltd.

23.3 Consent of BDO Seidman, LLP relating to the financial
statements of Utility Consultants, Inc.

23.4 Consent of Marden, Harrison & Kreuter relating to the
combined financial statements of Felix Equities, Inc. and
Affiliates.

23.5 Consent of Virchow, Krause & Company, LLP relating to the
financial statements of InterCon Construction, Inc.

23.6 Consent of McGladery & Pullen, LLP relating to the financial
statements of InterCon Construction, Inc.

**23.13 Consent of Kirkland & Ellis (included in Exhibit 5.1).

24.1 Powers of Attorney (included in Part II to the Registration
Statement).

27.1 Financial Data Schedule.
</TABLE>

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

** To be filed by Amendment.

+ Linc.net agrees to furnish supplementally to the Commission a copy of any
omitted schedule or exhibit to such agreement upon request by the
Commission.

II-8
<PAGE>
REPORT OF INDEPENDENT AUDITORS

Board of Directors
Linc.net, Inc.

We have audited the consolidated financial statements of Linc.net, Inc. as of
December 31, 1999, and for the period from October 19, 1999 (date operations
commenced) to December 31, 1999, and have issued our report thereon dated April
27, 2000 (included elsewhere in this Registration Statement). Our audit also
included the financial statement schedule listed in Item 16(b) of this
Registration Statement. This schedule is the responsibility of the Company's
management. Our responsibility to express an opinion based on our audit.

In our opinion, the financial statement schedule referred to above, when
considered in relation to the basic financial statements taken as a whole,
present fairly in all material respects the information set forth therein.

/S/ ERNST & YOUNG LLP

Chicago, Illinois
April 27, 2000

II-9
<PAGE>
SCHEDULE II - VALUATION AND QUALIFYING ACCOUNTS
LINC.NET, INC.
DECEMBER 31, 1999

<TABLE>
<CAPTION>
ADDITIONS
---------------------------
BALANCE AT CHARGE TO COSTS BALANCE AT
OCTOBER 19, 1999 AND EXPENSES OTHER (1) DEDUCTIONS (2) DECEMBER 31, 1999
---------------- --------------- --------- -------------- -----------------
<S> <C> <C> <C> <C> <C>
Allowance for doubtful
accounts................ $241 $95 $20 $241 $115
</TABLE>

Notes to table:

(1) Allowance for doubtful accounts recorded by Muller & Pribyl Utilities, Inc.
and M&P Utilities, Inc. and included in Linc.net's consolidated financial
statements in connection with the purchase accounting.

(2) Uncollectible accounts written off, net of recoveries.

II-10