x
|
QUARTERLY
REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
ACT OF
1934
|
o
|
TRANSITION
REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
ACT OF
1934
|
Delaware
(State
of incorporation)
|
84-1342898
(I.R.S.
Employer Identification No.)
|
|
|
60-D
Commerce Way, Totowa, New Jersey
(Address
of principal executive offices)
|
07512
(Zip
Code)
|
|
|
Class
|
|
Outstanding
at August 11, 2006
|
Common
Stock, $0.001 par value per share
|
|
50,429,621
|
|
|
Page
|
||
PARTI.
|
FINANCIAL
INFORMATION
|
4
|
||
|
|
|
||
|
Item
1.
|
Financial
Statements
|
4
|
|
|
|
|
|
|
|
|
Condensed
Consolidated Balance Sheets - June 30, 2006 (unaudited) and September
30,
2005
|
4
|
|
|
|
|
|
|
|
|
Condensed
Consolidated Statements of Operations - Nine and Three Months Ended
June
30, 2006 and 2005 (unaudited)
|
5
|
|
|
|
|
|
|
|
|
Condensed
Consolidated Statement of Stockholders’ Equity - Nine Months Ended June
30, 2006 (unaudited)
|
6
|
|
|
|
|
|
|
|
|
Condensed
Consolidated Statements of Cash Flows - Nine Months Ended June 30,
2006
and 2005 (unaudited)
|
7
|
|
|
|
|
|
|
|
|
Notes
to Condensed Consolidated Financial Statements (unaudited)
|
8
|
|
|
|
|
|
|
|
Item
2.
|
Management’s
Discussion and Analysis of Financial Condition and Results of Operations
|
12
|
|
|
|
|
||
|
Item
3.
|
Quantitative
and Qualitative Disclosures About Market Risk
|
21
|
|
|
|
|
|
|
|
Item
4.
|
Controls
and Procedures
|
22
|
|
|
|
|
||
PARTII.
|
OTHER
INFORMATION
|
22
|
||
|
|
|
||
|
Item
1.
|
Legal
Proceedings
|
22
|
|
Item
1A.
|
Risk
Factors
|
22
|
||
|
|
|
|
|
|
Item
2.
|
Unregistered
Sales of Equity Securities and Use of Proceeds
|
23
|
|
|
|
|
|
|
|
Item
3.
|
Defaults
upon Senior Securities
|
23
|
|
|
|
|
|
|
|
Item
4.
|
Submission
of Matters to a Vote of Security Holders
|
23
|
|
|
|
|
|
|
|
Item
5.
|
Other
Information
|
23
|
|
|
|
|
|
|
|
Item
6.
|
Exhibits
|
23
|
June
30,
2006
|
September
30,
2005
|
||||||
ASSETS
|
|||||||
CURRENT
|
|||||||
Cash
and cash equivalents
|
$
|
1,257,558
|
$
|
9,358,021
|
|||
Accounts
receivable- trade, net of an allowance of $125,004 and $151,045
|
1,362,884
|
1,562,398
|
|||||
Prepaid
expenses and deposits
|
425,910
|
200,345
|
|||||
TOTAL
CURRENT ASSETS
|
3,046,352
|
11,120,764
|
|||||
|
|||||||
Telecommunications
equipment inventory
|
1,229,259
|
963,081
|
|||||
Property
and equipment, net of accumulated depreciation of $7,445,355 and
$4,954,301
|
18,193,421
|
14,435,784
|
|||||
Intangible
assets, net of accumulated amortization of $3,008,129 and $2,279,918
|
2,059,173
|
2,740,787
|
|||||
TOTAL
ASSETS
|
$
|
24,528,205
|
$
|
29,260,416
|
|||
|
|||||||
LIABILITIES
and STOCKHOLDERS’ EQUITY
|
|||||||
CURRENT
LIABILITIES
|
|||||||
Accounts
payable
|
$
|
1,477,966
|
$
|
1,196,504
|
|||
Other
accrued liabilities
|
779,846
|
1,114,343
|
|||||
Current
portion of deferred revenue
|
661,812
|
934,270
|
|||||
Current
portion of note payable
|
45,670
|
45,670
|
|||||
Current
portion of capital lease obligations
|
75,478
|
45,156
|
|||||
TOTAL
CURRENT LIABILITIES
|
3,040,772
|
3,335,943
|
|||||
|
|||||||
Deferred
revenue, net of current portion
|
269,442
|
—
|
|||||
Note
payable, net of current portion
|
116,845
|
150,636
|
|||||
Capital
lease obligations, net of current portion
|
96,092
|
24,575
|
|||||
TOTAL
LIABILITIES
|
3,523,151
|
3,511,154
|
|||||
COMMITMENTS
AND CONTINGENCIES
|
|||||||
STOCKHOLDERS’
EQUITY
|
|||||||
Preferred
stock, par value $0.001; 5,000,000 shares authorized, none issued
|
—
|
—
|
|||||
Common
stock, par value $0.001; 70,000,000 shares authorized, 50,292,331
and
49,812,922 shares issued and outstanding
|
50,292
|
49,815
|
|||||
Additional
paid-in capital
|
58,155,949
|
57,194,221
|
|||||
Unearned
compensation
|
—
|
(549,475
|
)
|
||||
Accumulated
deficit
|
(37,201,187
|
)
|
(30,945,299
|
)
|
|||
TOTAL
STOCKHOLDERS’ EQUITY
|
21,005,054
|
25,749,262
|
|||||
TOTAL
LIABILITIES AND STOCKHOLDERS’ EQUITY
|
$
|
24,528,205
|
$
|
29,260,416
|
|||
Nine
Months Ended June 30,
|
Three
Months Ended June 30,
|
||||||||||||
2006
|
2005
|
2006
|
2005
(restated)
|
||||||||||
REVENUE
|
$
|
9,693,949
|
$
|
6,389,189
|
$
|
3,449,752
|
$
|
2,414,566
|
|||||
OPERATING
EXPENSES
|
|||||||||||||
Direct
costs
|
3,875,512
|
2,538,449
|
1,410,099
|
958,347
|
|||||||||
Sales
expenses
|
1,328,514
|
1,428,988
|
441,282
|
486,303
|
|||||||||
Customer
service and operating expenses
|
3,676,776
|
1,898,569
|
1,241,451
|
711,859
|
|||||||||
General
and administrative expenses (including non-cash charges (credits)
of
$1,426,748, $724,455, $491,518 and ($873,773))
|
3,961,891
|
2,468,633
|
1,428,448
|
(310,596
|
)
|
||||||||
Depreciation
and amortization
|
3,215,117
|
2,129,246
|
1,138,744
|
807,998
|
|||||||||
TOTALS
|
16,057,810
|
10,463,885
|
5,660,024
|
2,653,911
|
|||||||||
OPERATING
LOSS
|
(6,363,861
|
)
|
(4,074,696
|
)
|
(2,210,272
|
)
|
(239,345
|
)
|
|||||
Other
income (expense)
|
|||||||||||||
Gain
on sale of customers
|
—
|
715,696
|
— |
634,380
|
|||||||||
Interest
income
|
124,918
|
156,989
|
22,926
|
70,716
|
|||||||||
Interest
expense
|
(16,945
|
)
|
(5,418
|
)
|
(7,173
|
)
|
(1,817
|
)
|
|||||
NET
EARNINGS (LOSS)
|
$
|
(6,255,888
|
)
|
$
|
(3,207,429
|
)
|
$
|
(2,194,519
|
)
|
$
|
463,934
|
||
BASIC
AND DILUTED EARNINGS (LOSS) PER COMMON SHARE
|
$
|
(0.12
|
)
|
$
|
(0.07
|
)
|
$
|
(0.04
|
)
|
$
|
0.01
|
||
WEIGHTED
AVERAGE COMMON SHARES OUTSTANDING - BASIC
|
50,135,794
|
48,080,873
|
50,252,146
|
49,610,854
|
|||||||||
WEIGHTED
AVERAGE COMMON SHARES OUTSTANDING - DILUTED (See Note 2)
|
50,135,794
|
48,080,873
|
50,252,146
|
57,818,136
|
Common
stock
|
Additional
paid-in
|
Unearned
|
Accumulated
|
||||||||||||||||
Shares
|
Amount
|
capital
|
compensation
|
deficit
|
Total
|
||||||||||||||
Balance,
October 1, 2005
|
49,812,922
|
$
|
49,815
|
$
|
57,194,221
|
$
|
(549,475
|
)
|
$
|
(30,945,299
|
)
|
$
|
25,749,262
|
||||||
Effect
of adoption of SFAS 123R
|
549,475
|
549,475
|
|||||||||||||||||
Issuance
of common stock for employee stock purchases
|
25,388
|
24
|
38,191
|
38,215
|
|||||||||||||||
Issuance
of common stock for employee bonuses
|
56,385
|
56
|
78,777
|
78,833
|
|||||||||||||||
Issuance
of common stock for warrants exercised
|
350,000
|
350
|
87,150
|
87,500
|
|||||||||||||||
Issuance
of common stock for options exercised
|
47,636
|
47
|
15,672
|
15,719
|
|||||||||||||||
Shared-based
compensation expense - employees
|
831,222
|
831,222
|
|||||||||||||||||
Share-based
compensation credit - nonemployees
|
(89,284
|
)
|
(89,284
|
)
|
|||||||||||||||
Net
loss
|
|
|
|
|
(6,255,888
|
)
|
(6,255,888
|
)
|
|||||||||||
Balance,
June 30, 2006
|
50,292,331
|
$
|
50,292
|
$
|
58,155,949
|
$
|
—
|
$
|
(37,201,187
|
)
|
$
|
21,005,054
|
Nine
Months
ended
June
30, 2006
|
Nine
Months ended
June
30, 2005
|
||||||
|
|
|
|||||
OPERATING
ACTIVITIES
|
|||||||
Net
loss
|
$
|
(6,255,888
|
)
|
$
|
(3,207,429
|
)
|
|
Adjustments
to reconcile net loss to net cash used in operating activities:
|
|||||||
Bad
debt provision
|
107,044
|
1,423
|
|||||
Inventory
provision
|
57,977
|
||||||
Depreciation
and amortization
|
3,215,117
|
2,129,246
|
|||||
Share-based
compensation expense - employees
|
831,222
|
||||||
Share-based
compensation expense - nonemployees
|
346,930
|
454,874
|
|||||
Effect
of variable accounting for employee stock options
|
—
|
423,999
|
|||||
Effect
of issuance of common stock in exchange for termination of agreement
|
—
|
270,200
|
|||||
Effect
of cancellation of common stock and warrants in exchange for termination
of agreement
|
—
|
(426,041
|
)
|
||||
Compensation
expense for issuance of common stock through employee stock purchase
plan
|
4,742
|
—
|
|||||
Compensation
expense for issuance of common stock for employee bonuses
|
78,833
|
—
|
|||||
Gain
on sale of customers
|
—
|
(715,696
|
)
|
||||
Changes
in operating assets and liabilities:
|
|||||||
Accounts
receivable
|
92,470
|
(319,876
|
)
|
||||
Prepaid
expenses and deposits
|
(112,304
|
)
|
(54,948
|
)
|
|||
Accounts
payable
|
281,462
|
91,430
|
|||||
Other
accrued liabilities
|
(301,024
|
)
|
200,388
|
||||
Deferred
revenue
|
(3,016
|
)
|
(53,332
|
)
|
|||
Net
cash used in operating activities
|
(1,656,435
|
)
|
(1,205,762
|
)
|
|||
INVESTING
ACTIVITIES
|
|||||||
Purchase
of property and equipment
|
(6,414,878
|
)
|
(8,452,300
|
)
|
|||
Proceeds
from sale of customers and property and equipment
|
—
|
1,232,648
|
|||||
Acquisition
of intangible assets
|
(42,864
|
)
|
(178,515
|
)
|
|||
Net
cash used in investing activities
|
(6,457,742
|
)
|
(7,398,167
|
)
|
|||
FINANCING
ACTIVITIES
|
|||||||
Payments
of note payable
|
(33,791
|
)
|
—
|
||||
Proceeds
from private placement of common stock and warrants
|
—
|
15,045,444
|
|||||
Proceeds
from options exercised
|
15,719
|
401,246
|
|||||
Proceeds
from warrants exercised
|
87,500
|
374,708
|
|||||
Payments
of capital lease obligations
|
(55,714
|
)
|
(48,700
|
)
|
|||
Net
cash provided by financing activities
|
13,714
|
15,772,698
|
|||||
NET
INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS
|
(8,100,463
|
)
|
7,168,769
|
||||
CASH
AND CASH EQUIVALENTS, BEGINNING OF PERIOD
|
9,358,021
|
4,705,722
|
|||||
CASH
AND CASH EQUIVALENTS, END OF PERIOD
|
$
|
1,257,558
|
$
|
11,874,491
|
1.
|
GENERAL
|
Nine
Months
Ended
June
30, 2005
|
Three
Months
Ended
June
30, 2005
(restated)
|
||||||
Net
income (loss), as reported
|
$
|
(3,207,429
|
)
|
$
|
463,934
|
||
Add
(deduct):
|
|||||||
Total
stock-based employee compensation expense (credits) determined under
the
intrinsic value method for all awards, net of related tax
effects
|
456,599
|
(883,404
|
)
|
||||
Total
stock-based employee compensation expense (credits) determined under
the
fair value based method for all awards, net of related tax
effects
|
(660,403
|
)
|
36,544
|
||||
Pro
forma net loss
|
$
|
(3,411,233
|
)
|
$
|
(382,926
|
)
|
|
|
|||||||
Basic
and diluted net earnings (loss) per share:
|
|||||||
As
reported
|
$
|
(0.07
|
)
|
$
|
0.01
|
||
Pro
forma
|
$
|
(0.07
|
)
|
$
|
(0.01
|
)
|
Nine
Months
Ended
June
30, 2005
|
Three
Months
Ended
June
30, 2005
|
||||||
Expected
volatility
|
76
|
%
|
76
|
%
|
|||
Risk-free
interest rate
|
4.00
|
%
|
4.00
|
%
|
|||
Expected
years of option life
|
1
to 5
|
1
to 5
|
|||||
Expected
dividends
|
0
|
%
|
0
|
%
|
2.
|
EARNINGS
(LOSS) PER COMMON SHARE
|
3.
|
COMMON
STOCK, STOCK OPTION AND WARRANT ACTIVITY
|
Number
of Options Outstanding
|
Weighted
Average Exercise Price per Share
|
Weighted
Average Remaining Contractual Term (years)
|
Aggregate
Intrinsic Value
|
||||||||||
Outstanding
at September 30, 2005
|
3,300,342
|
$
|
1.79
|
||||||||||
Expired
|
(57,532
|
)
|
$
|
2.44
|
|||||||||
Exercised
|
(47,636
|
)
|
$
|
0.33
|
|||||||||
Outstanding
at June 30, 2006
|
3,195,174
|
$
|
1.80
|
3.1
|
$
|
419,453
|
|||||||
Exercisable
at June 30, 2006
|
2,025,577
|
$
|
1.48
|
2.6
|
$
|
411,584
|
4.
|
COMMITMENTS
AND CONTINGENCIES
|
5.
|
CAPITAL
LEASES
|
6. | FUNDING OF CURRENT OPERATIONS AND GROWTH |
7.
|
SUBSEQUENT
EVENTS
|
8.
|
RESTATEMENT
OF UNAUDITED QUARTERLY FINANCIAL INFORMATION
|
As
Previously
Reported
for
the
Three Months
Ended
6/30/2005
|
As
Restated for
the
Three Months Ended
6/30/2005
|
||||||
Statement
of Operations:
|
|||||||
General
and administrative expenses
|
$
|
(60,129
|
)
|
$
|
(310,596
|
)
|
|
Net
Income
|
$
|
213,467
|
$
|
463,934
|
|||
Basic
and diluted earnings per common share
|
$
|
0.00
|
$
|
0.01
|
MANAGEMENT’S
DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
|
Service
Type
|
Subscribers
as
of
June
30, 2005
|
Subscribers
as
of
Sept.
30, 2005
|
Subscribers
as
of
Dec.
31, 2005
|
Subscribers
as
of
March
31, 2006
|
Subscribers
as
of
June
30, 2006
|
|||||||||||
Bulk
DTH
|
3,963
|
5,470
|
6,213
|
7,226
|
7,830
|
|||||||||||
DTH
Choice / Exclusive
|
5,833
|
6,860
|
7,498
|
7,857
|
7,703
|
|||||||||||
Bulk
PC
|
16,869
|
16,587
|
16,894
|
18,011
|
17,778
|
|||||||||||
PC
Choice / Exclusive
|
1,370
|
1,399
|
1,318
|
1,303
|
1,230
|
|||||||||||
Bulk
Choice Advantage
|
2,175
|
2,941
|
3,689
|
4,627
|
4,818
|
|||||||||||
Bulk
ISP
|
1,771
|
1,823
|
2,267
|
3,116
|
3,100
|
|||||||||||
ISP
Choice / Exclusive
|
1,525
|
2,044
|
2,392
|
2,586
|
2,625
|
|||||||||||
Total
Subscribers
|
33,506
|
37,124
|
40,271
|
44,726
|
45,084
|
Bulk
Subscribers
|
|
Exclusive
Subscribers
|
|
Competitive
Subscribers
|
|
Total
Subscribers
|
|||||
New
construction “under contract” subscribers as of June 30, 2006:
|
|
3,557
|
|
|
843
|
|
|
2,319
|
|
|
6,719
|
Existing
conversion “under contract” subscribers as of June 30, 2006:
|
|
1,359
|
|
|
512
|
|
|
2,294
|
|
|
4,165
|
Total
“under contract” subscribers:
|
|
4,916
|
|
|
1,355
|
|
|
4,613
|
|
|
10,884
|
|
Nine
Months Ended
June
30,
|
Three
Months Ended
June
30,
|
|||||||||||
|
2006
|
2005
|
2006
|
2005
(restated)
|
|||||||||
EBITDA
|
$
|
(1,597,078
|
)
|
$
|
(348,310
|
)
|
$
|
(557,084
|
)
|
$
|
399,976
|
||
Interest
expense
|
(16,945
|
)
|
(5,418
|
)
|
(7,173
|
)
|
(1,817
|
)
|
|||||
Provision
for doubtful accounts
|
(107,044
|
)
|
(1,423
|
)
|
(22,121
|
)
|
(5,395
|
)
|
|||||
Provision
for inventory reserve
|
(57,977
|
)
|
—
|
—
|
—
|
||||||||
Depreciation
and amortization
|
(3,215,117
|
)
|
(2,129,246
|
)
|
(1,138,744
|
)
|
(807,998
|
)
|
|||||
Effect
of shares and warrants issued for termination of professional service
agreement
|
—
|
(270,200
|
)
|
—
|
(117,700
|
)
|
|||||||
Effect
of cancellation of shares and warrants issued for termination of
professional service agreement
|
—
|
426,041
|
—
|
206,250
|
|||||||||
Effect
of variable accounting for employee options
|
—
|
(423,999
|
)
|
—
|
883,404
|
||||||||
Share-based
compensation expense - employees
|
(831,222
|
)
|
—
|
(272,030
|
)
|
—
|
|||||||
Compensation
expense for issuance of common stock through employee stock purchase
plan
|
(4,742
|
)
|
—
|
(1,480
|
)
|
—
|
|||||||
Compensation
expense for issuance of common stock for employee bonuses
|
(78,833
|
)
|
—
|
(41,665
|
)
|
—
|
|||||||
Share-based
compensation expense - nonemployees
|
(346,930
|
)
|
(454,874
|
)
|
(154,222
|
)
|
(92,786
|
)
|
|||||
Net
Income (Loss)
|
$
|
(6,255,888
|
)
|
$
|
(3,207,429
|
)
|
$
|
(2,194,519
|
)
|
$
|
463,934
|
Nine
Months Ended June 30, 2006
|
Nine
Months Ended June 30, 2005
|
Change
($)
|
Change
(%) |
||||||||||||||||
REVENUE
|
$
|
9,693,949
|
100
|
%
|
$
|
6,389,189
|
100
|
%
|
$
|
3
,304,760
|
52
|
%
|
|||||||
Direct
costs
|
3,875,512
|
40
|
%
|
2,538,449
|
40
|
%
|
1,337,063
|
53
|
%
|
||||||||||
Sales
expenses
|
1,328,514
|
14
|
%
|
1,428,998
|
22
|
%
|
(100,484
|
)
|
-7
|
%
|
|||||||||
Customer
service and operating expenses
|
3,676,776
|
38
|
%
|
1,898,569
|
30
|
%
|
1,778,207
|
94
|
%
|
||||||||||
General
and administrative expenses
|
3,961,891
|
41
|
%
|
2,468,633
|
39
|
%
|
1,493,258
|
60
|
%
|
||||||||||
Depreciation
and amortization
|
3,215,117
|
33
|
%
|
2,129,246
|
33
|
%
|
1,085,871
|
51
|
%
|
||||||||||
OPERATING
LOSS
|
(6,363,861
|
)
|
-66
|
%
|
(4,074,706
|
)
|
-64
|
%
|
(2,289,155
|
)
|
56
|
%
|
|||||||
Total
other income
|
107,973
|
1
|
%
|
867,267
|
14
|
%
|
(759,294
|
)
|
-88
|
%
|
|||||||||
NET
LOSS
|
$
|
(6,255,888
|
)
|
-65
|
%
|
$
|
(3,207,439
|
)
|
-50
|
%
|
$
|
(3,048,449
|
)
|
95
|
%
|
|
Nine
Months Ended
June
30,
|
||||||
|
2006
|
2005
|
|||||
Private
Cable Programming Revenue
|
29
|
%
|
43
|
%
|
|||
DTH
Programming Revenue and Subsidy
|
54
|
%
|
46
|
%
|
|||
Internet
Access Fees
|
11
|
%
|
8
|
%
|
|||
Installation
Fees, Wiring and other Sales
|
6
|
%
|
3
|
%
|
|
Nine
Months Ended
June
30, 2006
|
||||||
|
($)
|
(%)
|
|||||
Call
Center Expenses
|
$
|
1,303,436
|
35
|
%
|
|||
General
Operations Expenses
|
$
|
1,147,175
|
31
|
%
|
|||
Property
System Maintenance Expenses
|
$
|
1,226,165
|
34
|
%
|
Three
Months
Ended June 30, 2006 |
Three
Months Ended June 30, 2005 (restated)
|
Change
($)
|
Change
(%)
|
||||||||||||||||
REVENUE
|
$
|
3,449,752
|
100
|
%
|
$
|
2,414,566
|
100
|
%
|
$
|
1,035,186
|
43
|
%
|
|||||||
Direct
costs
|
1,410,099
|
41
|
%
|
958,347
|
40
|
%
|
451,752
|
47
|
%
|
||||||||||
Sales
expenses
|
441,282
|
13
|
%
|
486,303
|
20
|
%
|
(45,021
|
)
|
-9
|
%
|
|||||||||
Customer
service and operating expenses
|
1,241,451
|
36
|
%
|
711,859
|
29
|
%
|
529,592
|
74
|
%
|
||||||||||
General
and administrative expenses
|
1,428,448
|
41
|
%
|
(310,596
|
)
|
-13
|
%
|
1,739,044
|
560
|
%
|
|||||||||
Depreciation
and amortization
|
1,138,744
|
33
|
%
|
807,998
|
33
|
%
|
330,746
|
41
|
%
|
||||||||||
OPERATING
LOSS
|
(2,210,272
|
)
|
-64
|
%
|
(239,345
|
)
|
-9
|
%
|
(1,970,927
|
)
|
823
|
%
|
|||||||
Total
other income
|
15,753
|
1
|
%
|
703,279
|
29
|
%
|
(687,526
|
)
|
-98
|
%
|
|||||||||
NET
INCOME (LOSS)
|
$
|
(2,194,519
|
)
|
-63
|
%
|
$
|
463,934
|
20
|
%
|
$
|
(2,658,453
|
)
|
-573
|
%
|
|
Three
Months Ended
June
30,
|
||||||
|
2006
|
2005
|
|||||
Private
Cable Programming Revenue
|
28
|
%
|
41
|
%
|
|||
DTH
Programming Revenue and Subsidy
|
54
|
%
|
48
|
%
|
|||
Internet
Access Fees
|
12
|
%
|
8
|
%
|
|||
Installation
Fees, Wiring and other Sales
|
6
|
%
|
3
|
%
|
|
Three
Months Ended
June
30, 2006
|
||||||
|
($)
|
(%)
|
|||||
Call
Center Expenses
|
$
|
455,463
|
37
|
%
|
|||
General
Operations Expenses
|
$
|
404,170
|
33
|
%
|
|||
Property
System Maintenance Expenses
|
$
|
381,818
|
30
|
%
|
QUANTITATIVE
AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
|
CONTROLS
AND PROCEDURES
|
LEGAL
PROCEEDINGS
|
RISK
FACTORS
|
UNREGISTERED
SALES OF EQUITY SECURITIES AND USE OF PROCEEDS
|
DEFAULTS
UPON SENIOR NOTES
|
SUBMISSION
OF MATTERS TO A VOTE OF SECURITY HOLDERS
|
OTHER
INFORMATION
|
EXHIBITS
|
|
|
|
|
MDU
COMMUNICATIONS INTERNATIONAL, INC.
|
|
|
|
|
Date:
August 14, 2006
|
By:
|
/s/
SHELDON NELSON
|
|
Sheldon
Nelson
Chief
Financial Officer
|
|
|
|
|
|
|
|
|
MDU
COMMUNICATIONS INTERNATIONAL, INC.
|
|
|
|
|
Date: August
14, 2006
|
By:
|
/s/
CARMEN RAGUSA, JR.
|
|
Carmen
Ragusa, Jr.
Vice
President of Finance
|
|
|
|