##### Table of Contents



UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
 WASHINGTON, DC 20549
 FORM 10-Q
 (Mark One)
 þ
    
    QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
 For the quarterly period ended January 31, 2010
 o
    
    TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
 For the transition period from  to
 Commission File Number: 001-34446
 (EASYLINK SERVICES LOGO)
 EasyLink Services International Corporation
  Delaware
    
    13-3645702(State or Other Jurisdiction of Incorporation or Organization)
    
    (I.R.S. Employer Identification No.)6025 The Corners Parkway, Suite 100Norcross, Georgia
    
    30092(Address of Principal Executive Offices)
    
    (Zip Code)
 (678) 533-8000
 þ o
 o o
  Large accelerated filer o
    
    Accelerated filer o
    
    Non-accelerated o
    
    Smaller reporting company þ
 Yes o No þ




---



##### 



EASYLINK SERVICES INTERNATIONAL CORPORATION
INDEX TO FORM 10-Q
 PagePART I FINANCIAL INFORMATIONItem 1. Financial Statements
    
    
    1Condensed Consolidated Balance Sheets as of January 31, 2010 (Unaudited) and July 31, 2009
    
    
    1Condensed Consolidated Statements of Operations for the three and six months ended January 31, 2010
and 2009 (Unaudited)
    
    
    2Condensed Consolidated Statements of Cash Flows for the six months ended January 31, 2010
and 2009 (Unaudited)
    
    
    3Notes to Condensed Consolidated Financial Statements (Unaudited)
    
    
    4Item 2. Managements Discussion and Analysis of Financial Condition and Results of Operations
    
    
    10Item 3. Quantitative and Qualitative Disclosures about Market Risk
    
    
    16Item 4T. Controls and Procedures
    
    
    16PART II OTHER INFORMATIONItem 1. Legal Proceedings
    
    
    16Item 1A. Risk Factors
    
    
    17Item 2. Unregistered Sales of Equity Securities and Use of Proceeds
    
    
    17Item 3. Defaults Upon Senior Securities
    
    
    17Item 4. Submission of Matters to a Vote of Security Holders
    
    
    17Item 5. Other Information
    
    
    17Item 6. Exhibits
    
    
    18Signatures
    
    
    19Exhibit 31.1Exhibit 31.2Exhibit 32.1Exhibit 32.2




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##### Table of Contents



PART I. FINANCIAL INFORMATION
 
 Item 1.
    
    Financial Statements
 
 Condensed Consolidated Balance Sheets as of January 31, 2010 and July 31, 2009
 January 31,
    
    
    July 31,2010
    
    
    2009(Unaudited)
    
    
    (Audited)ASSETSCurrent assets:Cash and cash equivalents
    
    $
    15,495,738
    
    
    $
    10,972,365Accounts receivable, net of allowance for doubtful accounts and allowance for sales returns and allowances of $1,216,698 and $1,461,368, respectively
    
    
    12,897,232
    
    
    
    11,508,674Prepaid expenses and other current assets
    
    
    3,156,529
    
    
    
    3,835,859Total current assets
    
    
    31,549,499
    
    
    
    26,316,898Property and equipment, net of accumulated depreciation of $14,937,077 and $13,574,865, respectively
    
    
    6,630,000
    
    
    
    8,230,843Goodwill
    
    
    34,607,458
    
    
    
    34,840,654Other intangible assets, net
    
    
    18,483,742
    
    
    
    21,406,880Deferred tax asset, net of valuation allowance and other assets
    
    
    4,423,803
    
    
    
    5,521,428Total assets
    
    $
    95,694,502
    
    
    $
    96,316,703LIABILITIES AND STOCKHOLDERS EQUITYCurrent liabilities:Accounts payable
    
    $
    2,497,064
    
    
    $
    3,044,378Notes payable
    
    
    12,085,378
    
    
    
    9,495,374Accrued expenses
    
    
    7,145,676
    
    
    
    6,644,665Deferred revenue and other current liabilities
    
    
    1,995,575
    
    
    
    1,847,336Total current liabilities
    
    
    23,723,693
    
    
    
    21,031,753Notes payable, long term
    
    
    12,695,772
    
    
    
    17,512,034Other liabilities
    
    
    359,369
    
    
    
    553,762Total liabilities
    
    
    36,778,834
    
    
    
    39,097,549Commitments and contingenciesStockholders Equity:Series C Preferred Stock  par value $.01 per share, 44.76 votes per share; 5,000 shares issued and 5,000 outstanding (liquidation value of $5,016,986 at January 2010 and $5,116,164 at July 2009)
    
    
    50
    
    
    
    50Series E Preferred Stock  par value $0.01 per share; 6,577 shares issued and outstanding in 2010 (liquidation value of $7,041,895 at January 2010 and $6,710,342 at July 2009)
    
    
    66
    
    
    
    66Common stock:Class A  par value $.01 per share, 300,000,000 shares authorized, one vote
per share; 27,285,887 and 27,261,193 shares issued at January 31, 2010 and July 31, 2009, respectively
    
    
    272,859
    
    
    
    272,612Additional paid-in capital
    
    
    138,577,408
    
    
    
    138,463,290Treasury stock  1,000,000 shares as of January 2010 and July 2009
    
    
    (2,122,288
    )
    
    
    (2,122,288
    )Accumulated other comprehensive loss
    
    
    (5,440,057
    )
    
    
    (4,442,091
    )Accumulated deficit
    
    
    (72,372,370
    )
    
    
    (74,952,485
    )Total stockholders equity
    
    
    58,915,668
    
    
    
    57,219,154Total liabilities and stockholders equity
    
    $
    95,694,502
    
    
    $
    96,316,703
   1




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Condensed Consolidated Statements of Operations for the three and six months ended January 31,

2010 and 2009 (Unaudited)
 Three Months Ended
    
    
    Six Months EndedJanuary 31,
    
    
    January 31,2010
    
    
    2009
    
    
    2010
    
    
    2009Service revenue
    
    $
    20,403,935
    
    
    $
    20,856,115
    
    
    $
    40,902,076
    
    
    $
    43,671,061Cost of services
    
    
    5,676,554
    
    
    
    5,802,493
    
    
    
    11,763,419
    
    
    
    12,521,638Gross profit
    
    
    14,727,381
    
    
    
    15,053,622
    
    
    
    29,138,657
    
    
    
    31,149,423Operating expenses:Product development and enhancement
    
    
    1,756,492
    
    
    
    2,004,863
    
    
    
    3,615,367
    
    
    
    4,127,328Selling and marketing
    
    
    3,228,163
    
    
    
    3,090,884
    
    
    
    6,497,597
    
    
    
    6,656,528General and administrative
    
    
    6,646,443
    
    
    
    6,532,092
    
    
    
    13,869,024
    
    
    
    15,890,119Intangible impairment
    
    
    
    
    
    
    4,245,914
    
    
    
    
    
    
    
    4,245,914Operating income (loss)
    
    
    3,096,283
    
    
    
    (820,131
    )
    
    
    5,156,669
    
    
    
    229,534Other income (expense):Interest and investment income
    
    
    7,009
    
    
    
    12,208
    
    
    
    14,345
    
    
    
    141,783Interest expense
    
    
    (433,725
    )
    
    
    (3,901,426
    )
    
    
    (927,558
    )
    
    
    (9,018,655
    )Foreign exchange gain (loss)
    
    
    (26,389
    )
    
    
    138,548
    
    
    
    253,561
    
    
    
    136,150Other income (expense)
    
    
    (85,290
    )
    
    
    34,460
    
    
    
    (31,284
    )
    
    
    98,565Profit (loss) before income taxes
    
    
    2,557,888
    
    
    
    (4,536,341
    )
    
    
    4,465,733
    
    
    
    (8,412,623
    )Provision for income taxes
    
    
    1,250,323
    
    
    
    298,917
    
    
    
    1,794,183
    
    
    
    755,269Net Income (loss)
    
    
    1,307,565
    
    
    
    (4,835,258
    )
    
    
    2,671,550
    
    
    
    (9,167,892
    )Dividends on preferred stock
    
    
    (216,187
    )
    
    
    (50,230
    )
    
    
    (432,375
    )
    
    
    (100,593
    )Net income(loss) attributable to common stockholders
    
    $
    1,091,378
    
    
    $
    (4,885,488
    )
    
    $
    2,239,175
    
    
    $
    (9,268,485
    )Basic income(loss) per common share
    
    $
    .04
    
    
    $
    (0.20
    )
    
    $
    .09
    
    
    $
    (0.38
    )Diluted income(loss) per common share
    
    $
    .04
    
    
    $
    (0.20
    )
    
    $
    .08
    
    
    $
    (0.38
    )Anti-dilutive stock options, warrants, Series A and Series B Convertible Notes and Series C preferred stock
    
    
    4,231,043
    
    
    
    25,886,935
    
    
    
    4,211,297
    
    
    
    24,053,003Weighted average number of common shares outstanding  basic
    
    
    26,279,942
    
    
    
    24,220,786
    
    
    
    26,274,557
    
    
    
    24,565,540Weighted average number of common shares outstanding diluted
    
    
    29,426,187
    
    
    
    24,220,786
    
    
    
    29,413,353
    
    
    
    24,565,540
   2




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Condensed Consolidated Statements of Cash Flows for the six months ended January 31, 2010 and

2009
(Unaudited)
 Six Months Ended January 31,2010
    
    
    2009Cash flows from operating activities:Net income (loss)
    
    $
    2,671,550
    
    
    $
    (9,167,893
    )Adjustments to reconcile net income (loss) to net cash provided by operating activities:Depreciation and amortization
    
    
    4,108,326
    
    
    
    4,404,994Bad debt expense
    
    
    249,621
    
    
    
    545,003Amortization of discount and other non-cash interest expense
    
    
    284,430
    
    
    
    5,365,010Deferred tax expense
    
    
    1,652,211
    
    
    
    Non-cash charges for equity instruments issued for compensation and services
    
    
    455,302
    
    
    
    573,095Non-cash equity in losses of investment and other non-cash items
    
    
    105,351
    
    
    
    (107,649
    )Goodwill and intangible impairment
    
    
    
    
    
    
    4,245,914Changes in assets and liabilitiesAccounts receivable
    
    
    (1,712,024
    )
    
    
    512,606Prepaid expenses and other assets
    
    
    687,842
    
    
    
    1,535,758Accounts payable
    
    
    (412,464
    )
    
    
    (89,595
    )Accrued expenses
    
    
    219,054
    
    
    
    (3,575,809
    )Other liabilities
    
    
    (400,639
    )
    
    
    (915,280
    )Net cash provided by operating activities
    
    
    7,908,560
    
    
    
    3,326,154Cash flows from investing activities:Purchases of property and equipment
    
    
    (675,398
    )
    
    
    (3,188,745
    )Other
    
    
    
    
    
    
    53,924Net cash used in investing activities
    
    
    (675,398
    )
    
    
    (3,134,821
    )Cash flows from financing activities:Proceeds from sale of stock and exercise of options and warrants
    
    
    
    
    
    
    2,588Purchase of treasury stock
    
    
    
    
    
    
    (1,818,963
    )Dividends paid
    
    
    (200,000
    )
    
    
    Net repayments of notes payable and capital lease
    
    
    (2,510,688
    )
    
    
    (18,808,845
    )Net cash (used in) financing activities
    
    
    (2,710,688
    )
    
    
    (20,625,220
    )Effect of foreign exchange rate changes on cash and cash equivalents
    
    
    899
    
    
    
    (419,887
    )Net (decrease) increase in cash and cash equivalents
    
    
    4,523,373
    
    
    
    (20,853,774
    )Cash and cash equivalents, beginning of period
    
    
    10,972,365
    
    
    
    32,091,005Cash and cash equivalents, end of period
    
    $
    15,495,738
    
    
    $
    11,237,231
   3




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EASYLINK SERVICES INTERNATIONAL CORPORATION
 
 Notes to Condensed Consolidated Financial Statements (Unaudited)
 1. BASIS OF PRESENTATION
    Principles of consolidation and basis of presentation
  Recently Adopted Accounting Pronouncements
 FASB Accounting Standards Codification FASB Accounting Standards
Codification
 Fair Value Measurements and Disclosures (Topic 820)
  4




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Recent accounting pronouncements not yet adopted
   2. ACQUIRED INTANGIBLE ASSETS
  Weighted averageamortizationperiod (years)
    
    
    January 31, 2010
    
    
    July 31, 2009Purchased customer relationships
    
    
    6-8
    
    
    $
    17,934,061
    
    
    $
    18,056,771Internally developed systems
    
    
    4
    
    
    
    10,552,325
    
    
    
    10,607,355Trade names
    
    
    <1
    
    
    
    3,746,846
    
    
    
    3,766,992Intangible assets, gross
    
    
    
    
    
    $
    32,233,232
    
    
    $
    32,431,118Less accumulated amortization:Purchased customer relationships
    
    
    
    
    
    $
    (6,224,926
    )
    
    $
    (4,919,923
    )Internally developed systems
    
    
    
    
    
    
    (7,391,429
    )
    
    
    (5,989,037
    )Trade names
    
    
    
    
    
    
    (133,135
    )
    
    
    (115,278
    )Accumulated amortization
    
    
    
    
    
    
    (13,749,489
    )
    
    
    (11,024,238
    )Intangible assets, net
    
    
    
    
    
    $
    18,483,742
    
    
    $
    21,406,880
  3. NOTES PAYABLE
  January 31, 2010
    
    
    July 31, 2009Term Loan
    
    $
    25,416,667
    
    
    $
    27,916,667Capitalized leases
    
    
    
    
    
    
    10,688Subtotal
    
    
    25,416,667
    
    
    
    27,927,355Less debt discount
    
    
    635,517
    
    
    
    919,947Less current portion of long term debt
    
    
    12,085,378
    
    
    
    9,495,374Long term debt
    
    $
    12,695,772
    
    
    $
    17,512,034
  5




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##### Table of Contents



4. STOCKHOLDERS EQUITY
 Dividends
     Stockholder Rights Agreement and Authorization of Series F Junior Participating Preferred
Stock
  5. INCOME TAXES
    6




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6. FAIR VALUE REPORTING
  
    
    Level 1  Observable inputs such as quoted prices in active market;
 
    
    Level 2  Inputs, other than the quoted prices in active markets, that are observable
either directly or indirectly; and
 
    
    Level 3  Unobservable inputs in which there is little or no market data, which
require the reporting entity to develop its own assumptions.
  Quoted Prices inActive Marketsfor Identical
    
    
    SignificantAssets
    
    
    Other
    
    
    Significant(Liabilities)
    
    
    Observable
    
    
    Unobservable(Level 1)
    
    
    Inputs (Level 2)
    
    
    Inputs (Level 3)
    
    
    Carrying AmountCash
    
    $
    12,679,407
    
    
    
    
    
    
    
    
    
    
    $
    12,679,407Cash Equivalents
    
    $
    2,816,331
    
    
    
    
    
    
    
    
    
    
    $
    2,816,331Notes Payable
    
    
    
    
    
    
    
    
    
    $
    (24,143,650
    )
    
    $
    (24,781,150
    )
  7. COMMITMENTS AND CONTINGENCIES
 Litigation
      7




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##### Table of Contents



8. INTERIM SEGMENT DISCLOSURES
  
    
    Supply Chain Messaging Segment (Supply Chain), which includes all our electronic data
interchange (EDI) and telex services.
 
    
    On Demand Messaging Segment (On Demand), which includes all fax, e-mail, document
capture and management (DCM) and workflow services.
  Supply Chain
    
    
    On Demand
    
    
    TotalQuarter Ended January 31, 2010Revenue from external customers
    
    $
    10,237,889
    
    
    $
    10,166,046
    
    
    $
    20,403,935Segment gross profit
    
    $
    7,645,247
    
    
    $
    7,082,134
    
    
    $
    14,727,381
  Segment gross profit
    
    $
    14,727,381Corporate expenses
    
    
    11,631,098Operating income
    
    
    3,096,283Other income (expense), net
    
    
    (538,395
    )Income before income taxes
    
    
    2,557,888Income tax expense
    
    
    1,250,323Net income
    
    $
    1,307,565
 Supply Chain
    
    
    On Demand
    
    
    TotalQuarter Ended January 31, 2009Revenue from external customers
    
    $
    10,432,808
    
    
    $
    10,423,307
    
    
    $
    20,856,115Segment gross profit
    
    $
    7,790,427
    
    
    $
    7,263,195
    
    
    $
    15,053,622
  Segment gross profit
    
    $
    15,053,622Corporate expenses
    
    
    11,627,839Intangible impairment
    
    
    4,245,914Operating (loss)
    
    
    (820,131
    )Other income (expense), net
    
    
    (3,716,210
    )Loss before income taxes
    
    
    (4,536,341
    )Income tax expense
    
    
    298,917Net loss
    
    $
    (4,835,258
    )
  8




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##### Table of Contents



Supply Chain
    
    
    On Demand
    
    
    TotalSix Months Ended January 31, 2010Revenue from external customers
    
    $
    20,809,137
    
    
    $
    20,092,939
    
    
    $
    40,902,076Segment gross profit
    
    $
    15,422,173
    
    
    $
    13,716,484
    
    
    $
    29,138,657
  Segment gross profit
    
    $
    29,138,657Corporate expenses
    
    
    23,981,988Operating income
    
    
    5,156,669Other income (expense), net
    
    
    (690,936
    )Income before income taxes
    
    
    4,465,733Income tax expense
    
    
    1,794,183Net income
    
    $
    2,671,550
 Supply Chain
    
    
    On Demand
    
    
    TotalSix Months Ended January 31, 2009Revenue from external customers
    
    $
    22,047,882
    
    
    $
    21,623,179
    
    
    $
    43,671,061Segment gross profit
    
    $
    16,264,872
    
    
    $
    14,884,551
    
    
    $
    31,149,423
  Segment gross profit
    
    $
    31,149,423Corporate expenses
    
    
    26,673,975Intangible impairment
    
    
    4,245,914Operating income
    
    
    229,534Other income (expense), net
    
    
    (8,642,157
    )Loss before income taxes
    
    
    (8,412,623
    )Income tax expense
    
    
    755,269Net loss
    
    $
    (9,167,892
    )
 9. DERIVATIVE FINANCIAL INSTRUMENTS
  10. SUBSEQUENT EVENTS
   9




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Item 2.
    
    Managements Discussion and Analysis of Financial Condition and Results of Operations
 Forward Looking Statement Disclaimer
   Business Overview
   
    
    Supply Chain segment, which includes all our EDI and telex services.
    
    On Demand segment, which includes all fax, e-mail, DCM and workflow services.
     10




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Critical Accounting Policies and Significant Use of Estimates in Financial Statements
   Six
Months Ended January 31, 2010 Compared with the Six Months Ended
January 31, 2009
 Results of Operations
  Six Months Ended January 31,2010
    
    
    2009
    
    
    VarianceRevenue:Supply Chain MessagingEDI Services
    
    $
    16,631,184
    
    
    $
    16,966,983
    
    
    $
    (335,799
    )Telex Services
    
    
    4,177,953
    
    
    
    5,080,899
    
    
    
    (902,946
    )Total Supply Chain Messaging
    
    
    20,809,137
    
    
    
    22,047,882
    
    
    
    (1,238,745
    )On Demand MessagingFax Services
    
    
    16,205,413
    
    
    
    17,333,028
    
    
    
    (1,127,615
    )DCM Services
    
    
    1,036,569
    
    
    
    1,432,903
    
    
    
    (396,334
    )Other Services
    
    
    2,850,957
    
    
    
    2,857,248
    
    
    
    (6,291
    )Total On Demand Messaging
    
    
    20,092,939
    
    
    
    21,623,179
    
    
    
    (1,530,240
    )Total Revenue:
    
    
    40,902,076
    
    
    
    43,671,061
    
    
    
    (2,768,985
    )Cost of Revenue:Supply Chain Messaging
    
    
    5,386,964
    
    
    
    5,783,010
    
    
    
    (396,046
    )On Demand Messaging
    
    
    6,376,455
    
    
    
    6,738,628
    
    
    
    (362,173
    )Total Cost of Revenue
    
    
    11,763,419
    
    
    
    12,521,638
    
    
    
    (758,219
    )Gross Margin:Supply Chain Messaging
    
    
    15,422,173
    
    
    
    16,264,872
    
    
    
    (842,699
    )On Demand Messaging
    
    
    13,716,484
    
    
    
    14,884,551
    
    
    
    (1,168,067
    )Total Gross Margin
    
    
    29,138,657
    
    
    
    31,149,423
    
    
    
    (2,010,766
    )Product Development and Enhancement
    
    
    3,615,367
    
    
    
    4,127,328
    
    
    
    (511,961
    )Selling and Marketing
    
    
    6,497,597
    
    
    
    6,656,528
    
    
    
    (158,931
    )General and Administrative
    
    
    13,869,024
    
    
    
    15,890,119
    
    
    
    (2,021,095
    )Intangible Impairment
    
    
    
    
    
    
    4,245,914
    
    
    
    (4,245,914
    )Total product, selling and G&A expenses
    
    
    23,981,988
    
    
    
    30,919,889
    
    
    
    (6,937,901
    )Other (expense) income
    
    
    (690,936
    )
    
    
    (8,642,157
    )
    
    
    7,951,221Income (loss) before income taxes
    
    $
    4,465,733
    
    
    $
    (8,412,623
    )
    
    $
    12,878,356
  11




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12




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Three Months Ended January 31, 2010 Compared with the Three Months Ended January 31, 2009
 Results of Operations
  Three Months Ended January 31,2010
    
    
    2009
    
    
    VarianceRevenue:Supply Chain MessagingEDI Services
    
    $
    8,197,171
    
    
    $
    8,046,624
    
    
    $
    150,547Telex Services
    
    
    2,040,718
    
    
    
    2,386,184
    
    
    
    (345,466
    )Total Supply Chain Messaging
    
    
    10,237,889
    
    
    
    10,432,808
    
    
    
    (194,919
    )On Demand MessagingFax Services
    
    
    8,168,695
    
    
    
    8,276,101
    
    
    
    (107,406
    )DCM Services
    
    
    521,337
    
    
    
    689,374
    
    
    
    (168,037
    )Other Services
    
    
    1,476,014
    
    
    
    1,457,832
    
    
    
    18,182Total On Demand Messaging
    
    
    10,166,046
    
    
    
    10,423,307
    
    
    
    (257,261
    )Total Revenue:
    
    
    20,403,935
    
    
    
    20,856,115
    
    
    
    (452,180
    )Cost of Revenue:Supply Chain Messaging
    
    
    2,592,642
    
    
    
    2,642,381
    
    
    
    (49,739
    )On Demand Messaging
    
    
    3,083,912
    
    
    
    3,160,112
    
    
    
    (76,200
    )Total Cost of Revenue
    
    
    5,676,554
    
    
    
    5,802,493
    
    
    
    (125,939
    )Gross Margin:Supply Chain Messaging
    
    
    7,645,247
    
    
    
    7,790,427
    
    
    
    (145,180
    )On Demand Messaging
    
    
    7,082,134
    
    
    
    7,263,195
    
    
    
    (181,061
    )Total Gross Margin
    
    
    14,727,381
    
    
    
    15,053,622
    
    
    
    (326,241
    )Product Development and Enhancement
    
    
    1,756,492
    
    
    
    2,004,863
    
    
    
    (248,371
    )Selling and Marketing
    
    
    3,228,163
    
    
    
    3,090,884
    
    
    
    137,279General and Administrative
    
    
    6,646,443
    
    
    
    6,532,092
    
    
    
    114,351Intangible Impairment
    
    
    
    
    
    
    4,245,914
    
    
    
    (4,245,914
    )Total product, selling and G&A expenses
    
    
    11,631,098
    
    
    
    15,873,753
    
    
    
    (4,252,655
    )Other (expense) income
    
    
    (538,395
    )
    
    
    (3,716,210
    )
    
    
    3,177,815Income (loss) before income taxes
    
    $
    2,557,888
    
    
    $
    (4,536,341
    )
    
    $
    7,094,229
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Liquidity and Capital Resources
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Off-Balance Sheet Arrangements
  
 Item 3.
    
    Quantitative and Qualitative Disclosures About Market Risk
  
 Item 4T.
    
    Controls and Procedures
 Disclosure Controls and Procedures
  Internal Controls over Financial Reporting
  
 PART II. OTHER INFORMATION
 
 Item 1.
    
    Legal Proceedings
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Item 1A.
    
    Risk Factors
  
 Item 2.
    
    Unregistered Sales of Equity Securities and Use of Proceeds
  
 Item 3.
    
    Defaults Upon Senior Securities
  
 Item 4.
    
    Submission of Matters to a Vote of Security Holders
   Name
    
    Votes For
    
    
    Votes WithheldRichard J. Berman
    
    
    7,577,024
    
    
    
    3,798,368Kim D. Cooke
    
    
    7,276,074
    
    
    
    4,099,318Donald R. Harkleroad
    
    
    6,742,018
    
    
    
    4,633,374Paul D. Lapides
    
    
    6,891,323
    
    
    
    4,484,069Dwight B. Mamanteo
    
    
    7,965,314
    
    
    
    3,410,078John S. Simon
    
    
    6,741,968
    
    
    
    4,633,424Thomas J. Stallings
    
    
    10,164,830
    
    
    
    1,210,562
   
 Item 5.
    
    Other Information
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Item 6.
    
    Exhibits
 ExhibitNumber
    
    Description31.1
    
    
    Certification of the Chief Executive Officer pursuant to
Section 302 of the Sarbanes-Oxley Act of 2002.31.2
    
    
    Certification of the Chief Financial Officer pursuant to
Section 302 of the Sarbanes-Oxley Act of 2002.32.1
    
    
    Certification of the Chief Executive Officer pursuant to
Section 906 of the Sarbanes-Oxley Act of 2002.32.2
    
    
    Certification of the Chief Financial Officer pursuant to
Section 906 of the Sarbanes-Oxley Act of 2002.
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SIGNATURES
   EASYLINK SERVICES INTERNATIONALCORPORATIONBy:
    
    /s/ Glen E. Shipley

Glen E. ShipleyChief Financial Officer
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EXHIBIT INDEX
 ExhibitNumber
    
    Description31.1
    
    
    Certification of the Chief Executive Officer pursuant to
Section 302 of the Sarbanes-Oxley Act of 2002.31.2
    
    
    Certification of the Chief Financial Officer pursuant to
Section 302 of the Sarbanes-Oxley Act of 2002.32.1
    
    
    Certification of the Chief Executive Officer pursuant to
Section 906 of the Sarbanes-Oxley Act of 2002.32.2
    
    
    Certification of the Chief Financial Officer pursuant to
Section 906 of the Sarbanes-Oxley Act of 2002.
  20