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UNITED STATES SECURITIES AND EXCHANGE COMMISSION
 Washington D.C. 20549
 
 FORM 10-KSB
 
 þ
    
    ANNUAL REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934.
 For the fiscal year ended June 30, 2005
 o
    
    TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934.
 For the transition period from
,
20, to, 20.
 Commission File Number0-27635
 
 SkyLynx Communications, Inc.
 (Exact Name of Registrant as Specified in Its Charter)
 
 Delaware
(State or Other Jurisdiction of
Incorporation or Organization)
    
    37-1465836
(I.R.S. Employer Identification Number)
 500 John Ringling Boulevard, Sarasota, Florida 34236(Address of Principal Executive Offices)
 (941) 388-2882
(Registrants Telephone Number, Including Area Code)
 
 Securities registered pursuant to Section 12(b) of the Act: NONE
 Securities registered pursuant to Section 12(g) of the Act:
 Title of each class:
    
    Name of each exchange on which registered:Common Stock, par value $.0001 per share
    
    None
 
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##### Table of Contents



1.
    
    Certificate of Incorporation of StarCom Wireless Networks, Inc.
(Incorporated by reference from Current Report on Form 8-K filed May
7, 2003).2.
    
    By-Laws of StarCom Wireless Networks, Inc. (Incorporated by reference
from Current Report on Form 8-K filed May 7, 2003).3.
    
    Certificate of Amendment to Certificate of Incorporation changing the
name of the Company to SkyLynx Communications, Inc. (Incorporated by
reference from Current Report on Form 8-K filed September 29, 2003).4.
    
    Letter of Understanding dated December 13, 2001 (Incorporated by
reference from Current Report on Form 8-K filed May 15, 2002.5.
    
    Option Agreement dated December 13, 2001 (Incorporate by reference
from Current Report on Form 8-K filed May 15, 2002.6.
    
    Trust Agreement dated June 15, 2002 (Incorporated by reference from
Annual Report on Form 10-KSB dated June 30, 2002 filed on October 15,
2002.7.
    
    Agreement and Plan of Reorganization between Rover Telcom Corporation,
Shareholders of Rover Telcom Corporation and Basic Technologies, Inc.
(Incorporated by reference from Current Report on Form 8-K filed
September 9, 2002).8.
    
    Articles of Incorporation of Rover Telcom Corporation (Incorporated by
reference from Current Report on Form 8-K filed September 9, 2002).9.
    
    By-Laws of Rover Telcom Corporation (Incorporated by reference from
Current Report on Form 8-K Filed September 9, 2002)10.
    
    Asset Purchase and Lock-Up Agreement by and Between Rover Group, Inc.
and Inforum Communications, Inc. (Incorporated by reference from
Current Report on Form 8-K Filed September 9, 2002)11.
    
    Agreement and Plan of Merger between Basic Technologies, Inc. and
StarCom Wireless Networks, Inc. (Incorporated by reference from
Current Report on Form 8-K Filed May 7, 2003)12.
    
    Press Release dated July 17, 2003 Announces Termination Of Letter Of
Intent And New Strategic Direction (Incorporated by reference from
Current Report on Form 8-K filed July 17,2003)13.
    
    SkyLynx Communications, Inc. 2002 Equity Incentive Plan (Incorporated
by reference from Registration Statement on Form S-8 filed December 8,
2003)14.
    
    Consultation and Securities Compensation Agreement between the Company
and Carl Dilley dated November 4, 2003 (Incorporated by reference from
Registration Statement on Form S-8 filed December 8, 2003)15.
    
    Consultation and Securities Compensation Agreement between the Company
and Clifford L. Neuman dated November 4, 2003 (Incorporated by
reference from Registration Statement on Form S-8 filed December 8,
2003)16.
    
    Agreement And Plan Of Reorganization by and Among SkyLynx
Communications, Inc. Interim Corporate Resources LLC (Incorporated by
reference from Current Report on Form 8-K filed December 23, 2003)17.
    
    Common Stock Purchase Agreement between Gus Yepes and SkyLynx
Communications, Inc. (Incorporated by reference from Current Report on
Form 8-K filed May 14, 2004)18.
    
    Joint Venture Agreement between Inversiones Sinalco, S.A., IdNet,
S.A., and SkyLynx Communications Inc. . (Incorporated by reference
from Current Report on Form 8-K filed May 14, 2004)19.
    
    Escrow Agreement between Gus Yepes and SkyLynx Communications, Inc. .
(Incorporated by reference from Current Report on Form 8-K filed May
14, 2004)20.
    
    AVL Business Brochure (Incorporated by reference from Current Report
on Form 8-K filed June 29, 2004)21.
    
    Resignation letter From Steven S. Jesson dated September 2, 2004
(Incorporated by reference from




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22.
    
    The Board of Directors approved the election of Kevin Gorman and
Robert Weiss to the Board of Directors (Incorporated by reference from
Current Report on Form 8-K filed September 13, 2004)23.
    
    Resignation letter from Kevin Gorman from the Chief Operating Officer
Position, dated November 18, 2004 (Incorporated by reference from
Current Report on Form 8-K filed November 26, 2004)24.
    
    Resignation letter from Kevin Gorman from the Board of Directors,
dated January 28, 2005 (Incorporated by reference from Current Report
on Form 8-K filed January 31, 2005)25.
    
    The Board of Directors approved Steve Smith to serve as Vice
President, Chief Operating Officer and a board member (Incorporated by
reference from Current Report on Form 8-K filed February 25, 2005)26.
    
    The Company entered into an agreement to sell all of its shares in its
subsidiary, SkyLynx Communications de Costa Rica, S.A. (Incorporated
by reference from Current Report on Form 8-K filed April 25, 2005)27.
    
    The Company entered into a Letter of Intent to acquire ADTECH Systems,
Inc. (Incorporated by reference from Current Report on Form 8-K filed
May 5, 2005)28.
    
    The Company disclosed several transactions related to the unregistered
sales of its equity securities (Incorporated by reference from Current
Report on Form 8-K filed May 9, 2005)29.
    
    Agreement and Plan of Merger between SkyLynx Communications, Inc. and
ADTECH Systems, Inc. (Incorporated by reference from Current Report on
Form 8-K filed May 31, 2005)30.
    
    Defined the closing date of the Agreement and Plan of Merger between
SkyLynx Communications, Inc. and ADTECH Systems, Inc. (Incorporated by
reference from Current Report on Form 8-K filed June 29, 2005)31.
    
    The Company disclosed several transactions related to the unregistered
sales of its equity securities (Incorporated by reference from Current
Report on Form 8-K filed August 8, 2005)32.
    
    The Company disclosed several transactions related to the unregistered
sales of its equity securities (Incorporated by reference from Current
Report on Form 8-K filed August 17, 2005)33.
    
    Termination of Agreement and Plan of Merger between SkyLynx
Communications, Inc. and ADTECH Systems, Inc. (Incorporated by
reference from Current Report on Form 8-K filed August 22, 2005)34.
    
    Resignation of Daniel J. Sullivan as Chief Financial Officer,
effective September 28, 2005 (Incorporated by reference from Current
Report on Form 8-K filed September 29, 2005)35.
    
    Approval of change in the Companys Certified Accountant (Incorporated
by reference from Current Report on Form 8-K filed November 3, 2005)
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TABLE OF CONTENTS
 PART IItem 1.
    
    
    
    Description of BusinessItem 2.
    
    
    
    Description of PropertyItem 3.
    
    
    
    Legal ProceedingsItem 4.
    
    
    
    Submission of Matters to a Vote of Security HoldersPART IIItem 5.
    
    
    
    Market For Common Equity and Related Stockholder MattersItem 6.
    
    
    
    Managements Discussion and Analysis or Plan of OperationItem 7.
    
    
    
    Financial StatementsItem 8.
    
    
    
    Changes in and Disagreements With Accountants on Accounting and Financial DisclosureItem 8A
    
    
    
    Controls and ProceduresItem 8B
    
    
    
    Other InformationPART IIIItem 9.
    
    
    
    Directors, Executive Officers, Promoters and Control Persons; Compliance With Section 16(a) of the Exchange ActItem 10.
    
    
    
    Executive CompensationItem 11.
    
    
    
    Security Ownership of Certain Beneficial Owners and Management and Related Stockholder MattersItem 12.
    
    
    
    Certain Relationships and Related TransactionsItem 13.
    
    
    
    Exhibits and Reports on Form 8-KItem 14.
    
    
    
    Principal Accountants Fees and ServicesSignaturesCertificationsCertificationCertification Pursuant to 18 U.S.C. Section 1350




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PART I
 
 ITEM 1. DESCRIPTION OF BUSINESS.
 (a) Business Development
        2




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(b) Spin-Off and Change in Control .
              3




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Gary L. Brown
    
    
    
    1,543,675 sharesRover Telcom Corporation
    
    
    
    91,025 sharesRobert Todd
    
    
    
    65,300 sharesBridgeport Construction, Inc.
    
    
    
    700,000 sharesAmerican Merger Consultants, Inc.
    
    
    
    500,000 sharesMilford Communications Partners
    
    
    
    1,000,000 sharesStephen L. Rogers
    
    
    
    1,000,000 shares
  (c) Spin-Off Trust .
    (d) Acquisition of Rover Telcom Corporation .
  4




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(e) Redomestication, Reverse Split and Name Change .
  1.
    
    The reverse split of its common stock by a ratio of 1-for-7;2.
    
    Its redomestication to a corporation formed and organized under the
laws of the State of Delaware; and3.
    
    Its name change to StarCom Wireless Networks, Inc.
  (f) Acquisition of Interim Resources Corporation .
    (g) Acquisition of SkyLynx Communications de Costa Rica S.A.
    5




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(h) Consolidation
  (i) Sale of SkyLynx Costa Rica
    (j) Definitive Agreement to acquire StarCom
  1.
    
    All outstanding options and warrants issued by StarCom were to be cancelled.2.
    
    All debt, (secured, unsecured, unpaid salaries, convertible notes, trade accounts
payable in excess of $1,500,000 were to be converted to StarCom common stock and included
in the StarCom Equity. SkyLynx would assume up to $1,500,000 of such debt.
 6




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##### Table of Contents



3.
    
    SkyLynx agreed to issue 50% of the outstanding $.0001 par value Common Stock in
exchange for all shares of common stock of StarCom and all such shares were to be
restricted shares as described in the Securities Exchange Act of 1934, as amended.4.
    
    Shares held by AllCom, Inc., (AllCom) an affiliate and control person of StarCom,
were in dispute and a sufficient number of SkyLynx Common Stock were to be held in escrow
pending the dispute resolution as to the true ownership of those shares.5.
    
    SkyLynx initially advanced $30,000 to StarCom and received a UCC-1 form securing the
advance. With interest these advances grew to a total of $112,500.
          (k) Definitive Agreement to acquire ADTECH Systems, Inc.
  7




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BUSINESS OF ISSUER
 SkyLynx Wireless Network:  Qualifying the Need for the SkyLynx Wireless Solution
  How the SkyLynx Network Works  (see figure 1.0 for system diagram)
 The
SkyLynx Wireless Data Network Solution  General:
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The SkyLynx Radio Modem:
  Base Station:
  Network Operations Center:
  9




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Flexibility
  The Market  Industry Segments:
 
 
    
    Automatic Vehicle Location(AVL)- This category includes First
Response Groups (Police, Fire and Ambulance) as well as commercial
users, such as trucking fleets. AVL provides a tracking,
monitoring and data-exchange system for their fleet of vehicles.
Location and status information can be displayed directly on a map
through a Computer Aided Dispatch program at the Customers
operations center. By knowing precisely where units are and their
status, fleets can be managed more efficiently with quicker
response.
    
    Telematics- Telematics is the use of wireless data transmission to
monitor or control remote devices, equipment, or vehicles between
the mobile device and a fixed point. A prime example of Telematics
is increasing the horsepower of an over-the-road truck as it
approaches a mountain range automatically, giving the extra power
it needs, then, reducing the horsepower once it has crossed the
mountains to save fuel; without the driver even being aware of the
change. The trucks location is monitored and controlled from a
central, remote location. Maintenance information related to the
vehicle operation can also be transmitted and collected. When the
driver reaches his next stop, service would already be scheduled
and the necessary parts would be dispatched and available rather
than experiencing a part failure in an inconvenient location and
suffering substantial down time.
    
    Telemetry- The transfer of data between two fixed positioned
locations. This would typically include applications such as
reading residential or commercial utility meters, plus providing
load shed control to save energy consumption during peak periods.
Other applications can include measuring the inventory of a
vending machine to determine when the machine needs to be serviced
as well as the mix of products required. By time and date stamping
the purchase, patterns can be tracked and the machine
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stocked with the optimum product mix given the time of the year, temperature, and buying cycle,
thus maximizing the return on the vending machine.
    
    Supervisory Control & Data Acquisition(SCADA)- SCADA is a part of
automated process control system that provides monitoring and the
remote control of devices such as opening and closing valves,
monitoring levels, flow, temperature, just to site a few examples.
Each day on your way to work, you most likely pass several lift
stations, used in wastewater collection. You do not see them,
because they are underground. Each one of those lift stations
normally has three or more pumps. Each pump must be monitored as
well as the level of wastewater in the holding tank. If there is a
pump malfunction, another pump can be started, then, a maintenance
crew can be dispatched. Without the proper monitoring and control,
sewage overflows would most likely happen. A reasonable size
metropolitan area can have 15,000 lift stations or more. Each
industrial plant you also see on your way to work will have
hundreds of points they are monitoring and controlling using
SCADA. You can get a sense for the potential volume just through
your daily travels.
    
    Location Based Services-Other applications the network can
support include Location Based Services (LBS), which relate
information relevant to mobile users such as; roadside assistance
to motorists, remote data collection such as weather reports, road
conditions, traffic bottlenecks, location of fueling stations,
restaurants, movie theatres, ATM or points of interest etc.,
navigation assistance, and even instructions for troubleshooting
or repair.
 The Revenue Model:
   The Costs:
  Initial Deployment:
 1 4
 11




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
    
    Respond to emergency calls much quicker, with less equipment in the field.
    
    Avoid costly fines from their municipal customers due to slow call response.
    
    Participate in municipal contracts that require AVL and CAD implementation.
    
    Have future capabilities to transmit patient data and accident scene photos via a secure network.
 Payback:
 Ambulance Services:
 
    
    Improved response time
    
    Efficient deployment of response units
    
    Fleet management
    
    Non-public secure data communications
    
    Future enhancements in technology to increase patient care including
patient data transfer to hospitals
 AVL Market Statistics:
   Opportunities for SCADA, Telemetry and Telematics greatly outnumber that of AVL.
  Competition:
  12




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Cellular Technology:
  Satellite Technology:
  13




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Comparison:
  SkyLynx
    
    Cellular
    
    SatelliteCoverage
    
    Broad Geographic Coverage
    
    Population Centric Coverage
    
    Broad Geographic CoverageBandwidth
    
    Low bandwidth to achieve
distance; high bandwidth
at hotspots.
    
    High bandwidth where available.
    
    Good bandwidth with line of sight.End Users
    
    Regionally base station
limitation will range
from high hundreds to
several thousand radios
supported.
    
    Regional cell sites will
support thousands of users.
    
    Depending on carrier and
satellite, possible to support
thousands of users.Capacity
    
    Increasing base station
capacity is as simple as
adding a radio.
    
    Additional towers required for
incremental increase in
capacity.
    
    Additional satellites required.Target Markets
    
    Target markets are
commercial therefore
network is engineered to
support actual number of
users.
    
    Main market is general
population. Network is
engineered to support average
number of users at peak time.
    
    Target markets are commercial and
are engineered to support average
number of users at peak time.Network
    
    Dedicated network is
designed to support more
than actual users in the
area.
    
    Network is susceptible to
traffic jam when over loaded
such as during times of
natural disaster or other
large emergencies.
Proliferation of web surfing
    
    Transmissions are susceptible to
atmospheric interference.Pros and Cons
    
    Very terrain friendly,
able to penetrate where
other frequencies
cannot.
    
    and sending of pictures will
use significant bandwidth that
business markets may be
relying on.
    
    Requires line of sight (clear
view) to transmit and receive.
 Wireless Communications Networks:
  Network
    
    Estimated AVL Units
    
    Suppliers (examples)CircuitSwitched Cellular
    
    150,000
    
    TerionPeopleNetAirIQCellular
Digital Packet Data (CDPD)
    
    130,000
    
    @RoadTeletracAirLink CommunicationsDigital Cellular
    
    12,000
    
    Minorplanet (GSM)Data Burst TechnologiesQUALCOMM OmniExpress
 14




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Network
    
    Estimated AVL Units
    
    Suppliers (examples)iDEN
    
    30,000
    
    @RoadISRAeris Microburst
    
    53,000
    
    AirceptAirIQCellemetry
    
    20,000
    
    Aether SystemsIntertrak Tracking ServicesAVL Information SystemsPrivate Two-Way Radio Channels
    
    100,000
    
    Mentor EngineeringMobile KnowledgeMotorolaOrbital SciencesCingular Wireless (Mobitex)
    
    35,000
    
    Wireless MatrixDiscrete WirelessDigital Dispatch SystemsReFlex Paging Networks
    
    10,000  15,000
    
    Satellite Security SystemsMotient (ARDIS)
    
    30,000
    
    Aether Systems MobileMAXTeletrac Proprietary Network
    
    40,000
    
    TeletracOmniTRACS
    
    260,000 - 300,000
    
    QUALCOMMMobile Satellite Ventures (MSAT)
    
    60,000
    
    Aether Systems MobileMAXVistar Datacom WirelessMatrixORBCOMM
    
    10,000
    
    XATA Road Manager Caterpillar
 Source: C.J. Driscoll & Associates
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Separate EquipmentCompany
    
    Terrestrial Based
    
    Satellite Based
    
    Monthly Fee
    
    CostsAirIQ
    
    ü
    
    
    
    ü@Road
    
    ü
    
    
    
    ü
    
    üAirLink
    
    ü
    
    
    
    ü
    
    üCES Wireless
    
    ü
    
    
    
    ü
    
    üCompassCom
    
    ü
    
    
    
    ü
    
    üHGI Wireless
    
    ü
    
    
    
    ü
    
    üTeletrac
    
    ü
    
    
    
    ü
    
    üStarCom Wireless
    
    ü
    
    
    
    ü
    
    üNexterna
    
    ü
    
    
    
    ü
    
    üQualcomm
    
    
    
    ü
    
    ü
    
    üARINC
    
    
    
    ü
    
    ü
    
    üEchoburst
    
    
    
    ü
    
    ü
    
    üGlobalstar
    
    
    
    ü
    
    ü
    
    üMotient
    
    
    
    ü
    
    ü
    
    üAether
    
    ü
    
    ü
    
    ü
    
    ü
 The Objective:
  
    
    The SkyLynx base station can be co-located on existing tower sites.
    
    The SkyLynx base station has a range of approximately 80 miles vs. cellular at 5 to 8
miles.
    
    To cover the same area as one SkyLynx base station, you would need about 100 cellular
sites.
    
    The SkyLynx base station costs approximately $15,000, a fraction of a cellular site.
  Sales Strategy
  16




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7 Phase Plan
  Phase 1
    
    Opportunity CreationPhase 2
    
    Development of Account Sales StrategyPhase 3
    
    Follow Up, Chart Progress, Applications Support, Quote (or Bid)Phase 4
    
    Price Negotiation, Closing, Submittals (if required)Phase 5
    
    Order Entry, Customer Service, Follow Up, CommunicationPhase
6 
    
    Installation, Start Up, and Field ServicePhase 7
    
    Ongoing Product Support, Service Contract, Identify Additional Sales Opportunities (Customer Retention)
  Distribution
Channels
  Homeland Security:
  AVL Market Statistics and Competition provided by C. J. Driscoll & Associates
 17




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C.J. Driscoll & Associates
   Trailer Monitoring Systems and Services Study
 Commercial Telematics Systems and
Services Study
 U.S. Fleet AVL Market Study U.S. Fleet AVL Market Study
 2003-04 Location-Based Services, Telematics and
Navigation Systems Study
 Clement Driscoll Survey
of Location Systems to Support Wireless 911 GPS World GPS World RCR Telematics Update, Automotive Fleet Mission
Critical Magazine The Wall Street Journal, Business Week L.A. Times
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Rover Telcom dba NetAsset:
 Qualifying the Need for NetAsset Services:
  The NetAsset Operations:
  NetAsset Services:
  Development:
  
    
    Intranet ties the customers internal resources together,
providing seamless communications and files sharing.
    
    Most every commercial customer manages their business using
databases that contain critical information. Access to this
information is essential in timely management of the business and
in fully exploiting market opportunities. NetAsset can design
databases that can be accessed via the Internet, allowing the
sharing of critical information between employees, customers and
prospective customers. Examples include the access to online
pricing, order status, contact management, etc.
    
    Today, any organization involved in commercial activity is
expected to have a web presence. NetAsset can help companies by
updating their current web site, or creating a new web site. Each
Web Site design must reflect the needs of the customer. Ease in
navigation, content and aesthetics are all critical elements. The
design of the site can also determine how long a site will take to
load on the viewers computer. NetAsset has an excellent track
record in providing Web presence that will meet or exceed the
needs of its customers.
    
    E-Commerce is a relatively recent development in Internet function
and has grown exponentially, literally opening a new chapter in
commerce. Now a business can allow its customers to browse through
their products or services, even purchase them and checkout
without the need for salespeople, and a facility. To develop a
successful E-Commerce presence requires experience and attention
to detail, all NetAsset strengths.
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Co-Location:
  
    
    Maintenance access from 9am until 4pm Monday through Friday
    
    24x7 emergency access
    
    Complete Power Conditioning and UPS Backup
    
    Connectivity into Net Assets Backbone structure via 10/100MB Ethernet Connection
    
    Secured site with FM2 Fire suppression system
 Hosting:
 www.yourbusiness.com info@yourbusiness.com
 
    
    Hard drive space available from 50 to 400 megabytes in 50MB increments for your web site
    
    URL is www.yourbusiness.com(Domain Registration not included)
    
    Microsoft FrontPage 2002 Extensions supported
    
    CGI-BIN/CGI support for web site
    
    Perl 5+ support for web site
    
    MySQL support for web site
    
    Webalizer Log Analyzer for web site traffic monitoring service
 Access:
  NO NO
  20




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Product Strategy:
  NetAsset Digital Network (NADN)
 Digital Network
 DSL
  T1: For Mission-Critical Access
  21




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
    
    Guaranteed Full 1.544Mb connection up and downstream
    
    24/7 monitoring and support by Net Assets professional tech staff
    
    No usage charges
 DS-3 Service
  
    
    High-speed bandwidth
    
    High traffic volume
    
    Fast response
    
    Direct connections
    
    Digital accuracy
    
    Provides point-to-point full duplex transmission of serial data at 44.736Mbps
    
    Provisioned with fiber optics
    
    Available in multiples of 3 or 12 circuits
    
    Non-multiplexed DS3 allows full use of the 44.736Mbps transmission facility
    
    Multiple DS3 separates the circuit into 28 DS1 circuits, each with a speed of 1.544Mbps
    
    Fixed monthly charges based on circuit mileage and termination with or without equipment
    
    Optional features include Alternate Serving Wire Center and Customer Network Reconfiguration
    
    99.95% error-free seconds
    
    99.97% availability
 Strategic Partnerships:
   Selling Strategy:
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Employees and Consultants
  
 ITEM 2. DESCRIPTION OF PROPERTY
    
 ITEM 3. LEGAL PROCEEDINGS
  Optigate v. Rover Telcom, Inc.,
 ANGELO V. SKYLYNX COMMUNICATIONS, INC.
 23




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ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITYHOLDERS
  
 PART II
 
 ITEM 5. MARKET FOR COMMON EQUITY AND RELATED STOCKHOLDER MATTERS
   Common StockQuarter Ended
    
    Low
    
    HighMarch 31, 2003
    
    $
    .28
    
    
    $
    1.19June 30, 2003
    
    $
    .28
    
    
    $
    3.00September 30, 2003
    
    $
    .45
    
    
    $
    .77December 31, 2003
    
    $
    .59
    
    
    $
    .70March 31, 2004
    
    $
    .51
    
    
    $
    .96June 30, 2004
    
    $
    .15
    
    
    $
    .56September 30, 2004
    
    $
    .05
    
    
    $
    .33December 31, 2004
    
    $
    .05
    
    
    $
    .33March 31, 2005
    
    $
    .07
    
    
    $
    .23June 30, 2005
    
    $
    .06
    
    
    $
    .175September 30, 2005
    
    $
    .06
    
    
    $
    .125
  24




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Holders
  Dividends
  Recent Sales of Unregistered Securities
     25




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26




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27




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EQUITY COMPENSATION PLAN INFORMATION
 Number ofsecurities to be
    
    Weightedissued upon
    
    averageexercise of
    
    exercise price
    
    Number of securitiesoutstanding
    
    of outstanding
    
    remaining available for futureoptions,
    
    options,
    
    issuances under equitywarrants and
    
    warrants and
    
    compensation plansrights
    
    rights
    
    (excluding securities reflected(a)
    
    (b)
    
    in column (a)) (c)Equity compensation
plans approved by
security holders
    
    1,240,457(1)
    
    N/A
    
    2,500,000Equity compensation
plans not approved
by security holders
    
    -0-
    
    -0-
    
    -0-Total
    
    -0-
    
    -0-
    
    -0-
 
 (1)
    
    Consists of stock awards under Incentive Plan 
 ITEM 6. MANAGEMENTS DISCUSSION AND ANALYSIS
 OVERVIEW
  RESULTS OF OPERATIONS  FISCAL YEAR ENDED JUNE 30, 2005 COMPARED TO YEAR ENDED JUNE 30, 2004
  28




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LIQUIDITY AND CAPITAL RESOURCES
 Liquidity
  Financial condition
 Current assets
  Property and equipment
  Goodwill
  29




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Accounts payable, accrued salaries and other accrued liabilities
  Deferred revenue
  Loan payable to related party
        30




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##### Table of Contents



CRITICAL ACCOUNTING POLICIES
  Revenue Recognition Software Revenue
Recognition, SOP 98-9, Modification of SOP 97-2 with Respect to Certain Transactions and SEC Staff
Accounting Bulletin 101, Interpretive Guidance on Revenue Recognition
 Impairment of Long-Lived Assets
 Research and Development Costs , Accounting for the Costs of
Computer Software to Be Sold, Leased, or Otherwise Marketed
 RECENT ACCOUNTING PRONOUNCEMENTS
   31




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32




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##### Table of Contents



ITEM 7. FINANCIAL STATEMENTS
 SKYLYNX COMMUNICATIONS, INC.
 Consolidated Financial Statements
 As of June 30, 2005 and for the
Years Ended June 30, 2005 and 2004
 Contents
 PageReport of Independent Registered Public Accounting Firm
    
    F-1Consolidated Balance Sheet
    
    F-2Consolidated Statements of Operations
    
    F-3Consolidated Statement of Changes in Shareholders Deficit
    
    F-4Consolidated Statements of Cash Flows
    
    F-5Notes to Consolidated Financial Statements
    
    F-6
 33




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##### Table of Contents



Report of Independent Registered Public Accounting Firm
 
     
  F-1




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##### Table of Contents



SKYLYNX COMMUNICATIONS, INC.
 
 Consolidated Balance Sheet
 June 30, 2005
 AssetsCurrent assets:Cash
    
    $
    26,063Accounts receivable, net of allowance of $8,083
    
    
    30,681Other current assets
    
    
    1,131Prepaid expenses
    
    
    25,592Total current assets
    
    
    83,467Property and equipment, net of accumulated
depreciation of $147,089 (Note 3)
    
    
    27,411Note receivable
    
    
    50,000Prepaid loan costs
    
    
    34,425Deferred loan costs
    
    
    8,005Other assets
    
    
    8,704$
    212,012Liabilities and Shareholders DeficitCurrent liabilities:Accounts payable
    
    $
    680,977Accrued salaries
    
    
    418,746Other accrued liabilities
    
    
    65,781Deferred revenues
    
    
    36,909Notes payable (Note 7)
    
    
    507,697Loan payable to related parties (Note 2)
    
    
    11,800Total current liabilities
    
    
    1,721,910Convertible debentures (Notes 2 and 5)
    
    
    252,558Commitments (Note 6)
    
    
    Shareholders deficit (Note 4):Preferred stock, $.0001 par value; 10,000,000 shares authorized,
-0- shares issued and outstanding
    
    
    Common stock, $.0001 par value; 100,000,000 shares authorized,
30,019,442 shares issued and outstanding
    
    
    3,001Additional paid-in capital
    
    
    6,067,871Retained deficit
    
    
    (7,833,328
    )Total shareholders deficit
    
    
    (1,762,456
    )$
    212,012
  F-2




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##### Table of Contents



SKYLYNX COMMUNICATIONS, INC.
 
 Consolidated Statements of Operations
 Years EndedJune 30,2005
    
    
    2004Internet service revenue
    
    $
    471,477
    
    
    $
    339,272Costs of direct Internet service
    
    
    227,432
    
    
    
    194,199Gross profit
    
    
    244,045
    
    
    
    145,073Operating expenses:Selling, general and administrative
    
    
    1,335,245
    
    
    
    1,017,623Contributed rent (Note 2)
    
    
    
    
    
    
    450Bad debt (recovery) expense
    
    
    2,400
    
    
    
    (16,665
    )Research & development (Note 1)
    
    
    710,131
    
    
    
    830,226Costs of terminated merger (Note 6)
    
    
    
    
    
    
    49,077Impairment of goodwill (Note 1)
    
    
    369,039
    
    
    
    Stock-based compensation (Notes 2 and 4):Salaries
    
    
    111,900
    
    
    
    541,123Board services
    
    
    21,250
    
    
    
    403,050Legal
    
    
    
    
    
    
    213,250Consulting
    
    
    199,300
    
    
    
    674,672Total operating expenses
    
    
    2,749,265
    
    
    
    3,712,816Loss from operations
    
    
    (2,505,220
    )
    
    
    (3,567,743
    )Other (expense) income:Other income
    
    
    417
    
    
    
    Gain on sale of assets (Note 1)
    
    
    89,044
    
    
    
    Interest expense
    
    
    (145,326
    )
    
    
    (7,723
    )Total other (expense) income
    
    
    (55,865
    )
    
    
    (7,723
    )Loss before income taxes
    
    
    (2,561,085
    )
    
    
    (3,575,466
    )Income tax provision (Note 5)
    
    
    
    
    
    
    Net loss
    
    $
    (2,561,085
    )
    
    $
    (3,575,466
    )Basic and diluted loss per share
    
    $
    (0.14
    )
    
    $
    (0.39
    )Weighted average common shares outstanding
    
    
    18,824,286
    
    
    
    9,111,193
  F-3




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##### Table of Contents



SKYLYNX COMMUNICATIONS, INC.
 
 Consolidated Statement of Changes in Shareholders Deficit
 AdditionalCommon Stock
    
    
    Paid-In
    
    
    RetainedShares
    
    
    Par Value
    
    
    Capital
    
    
    Deficit
    
    
    TotalBalance, July 1, 2003
    
    
    7,274,716
    
    
    
    727
    
    
    
    1,553,367
    
    
    
    (1,696,777
    )
    
    
    (142,683
    )Stock-based compensation
    
    
    3,676,916
    
    
    
    368
    
    
    
    1,831,727
    
    
    
    
    
    
    
    1,832,095Common stock issued for acquisition of
Interim Corporate Resources
    
    
    700,000
    
    
    
    70
    
    
    
    251,930
    
    
    
    
    
    
    
    252,000Common stock issued for acquisition of
DirctCom S.A.
    
    
    300,000
    
    
    
    30
    
    
    
    69,270
    
    
    
    
    
    
    
    69,300Common stock sales net of
offering costs of $10,000
    
    
    2,719,813
    
    
    
    272
    
    
    
    995,173
    
    
    
    
    
    
    
    995,445Rent contributed by an officer
    
    
    
    
    
    
    
    
    
    
    450
    
    
    
    
    
    
    
    450Net loss
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (3,575,466
    )
    
    
    (3,575,466
    )Balance, June 30, 2004
    
    
    14,671,445
    
    
    
    1,467
    
    
    
    4,701,917
    
    
    
    (5,272,243
    )
    
    
    (568,859
    )Common stock sales
    
    
    2,091,588
    
    
    
    209
    
    
    
    164,791
    
    
    
    
    
    
    
    165,000Common stock issued for compensation
    
    
    769,000
    
    
    
    77
    
    
    
    111,823
    
    
    
    
    
    
    
    111,900Common stock issued to Directors for services
    
    
    500,000
    
    
    
    50
    
    
    
    21,200
    
    
    
    
    
    
    
    21,250Common stock issued for consulting services
    
    
    2,000,000
    
    
    
    200
    
    
    
    199,100
    
    
    
    
    
    
    
    199,300Common stock issued for previous acquisition based on
contingency
    
    
    200,000
    
    
    
    20
    
    
    
    (20
    )
    
    
    
    
    
    
    Common stock issued for providing a loan guarantee
    
    
    300,000
    
    
    
    30
    
    
    
    45,870
    
    
    
    
    
    
    
    45,900Common stock issued for accounts payable
    
    
    93,986
    
    
    
    9
    
    
    
    12,209
    
    
    
    
    
    
    
    12,218Capital contribution (Note 2)
    
    
    
    
    
    
    
    
    
    
    105,000
    
    
    
    
    
    
    
    105,000Common stock issued for conversion of debentures
    
    
    9,393,423
    
    
    
    939
    
    
    
    997,112
    
    
    
    
    
    
    
    998,051Loss on conversion of debentures by related parties
    
    
    
    
    
    
    
    
    
    
    (291,131
    )
    
    
    
    
    
    
    (291,131
    )Net loss
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (2,561,085
    )
    
    
    (2,561,085
    )Balance, June 30, 2005
    
    
    30,019,442
    
    
    
    3,001
    
    
    
    6,067,871
    
    
    
    (7,833,328
    )
    
    
    (1,762,456
    )
  F-4




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##### Table of Contents



SKYLYNX COMMUNICATIONS, INC.
 
 Consolidated Statements of Cash Flows
 Years EndedJune 30,2005
    
    
    2004Cash flows from operating activities:Net loss
    
    $
    (2,561,085
    )
    
    $
    (3,575,466
    )Adjustments to reconcile net loss to net cash
used in operating activities:Depreciation and amortization
    
    
    101,259
    
    
    
    43,703Common stock issued in exchange for
services (Notes 2 and 4)
    
    
    332,450
    
    
    
    1,832,095Gain on sale of assets
    
    
    (89,044
    )
    
    
    Loss on impairment of goodwill
    
    
    369,039
    
    
    
    Allowance for bad debts
    
    
    2,400
    
    
    
    5,598Rent contributed by an officer (Note 2)
    
    
    
    
    
    
    450Changes in current assets and liabilities, net of
effects of acquisitions:Accounts receivable
    
    
    (3,942
    )
    
    
    (8,400
    )Note receivable
    
    
    (50,000
    )
    
    
    Prepaid expenses
    
    
    (56,347
    )
    
    
    Other assets
    
    
    (21,885
    )
    
    
    (16,074
    )Accounts payable (including $992,639 converted to debentures and to
common stock)
    
    
    1,251,335
    
    
    
    298,068Accrued liabilities
    
    
    (39,386
    )
    
    
    432,472Deferred revenues
    
    
    (26,053
    )
    
    
    23,949Net cash used in operating activities
    
    
    (791,259
    )
    
    
    (963,605
    )Cash flows from investing activities:Equipment purchases
    
    
    (29,554
    )
    
    
    (177,647
    )Proceeds from sale of assets
    
    
    61,497
    
    
    
    Acquisition costs
    
    
    
    
    
    
    45,277Net cash provided (used) in
investing activities
    
    
    31,943
    
    
    
    (132,370
    )Cash flows from financing activities:Proceeds from related party loans (Note 2)
    
    
    34,775
    
    
    
    102,120Payments on related party loans (Note 2)
    
    
    (32,000
    )
    
    
    Proceeds from notes payable
    
    
    498,552
    
    
    
    Payments on notes payable
    
    
    (8,660
    )
    
    
    Capital contribution (Note 2)
    
    
    105,000
    
    
    
    Proceeds from sale of common stock (Note 4)
    
    
    165,000
    
    
    
    995,445Net cash provided by
financing activities
    
    
    762,667
    
    
    
    1,097,565Net change in cash
    
    
    3,351
    
    
    
    1,590Cash, beginning of year
    
    
    22,712
    
    
    
    21,122Cash, end of year
    
    $
    26,063
    
    
    $
    22,712Supplemental disclosure of cash flow information:Cash paid for income taxes
    
    $
    
    
    
    $
    Cash paid for interest
    
    $
    
    
    
    $
    Non-cash investing and financing transaction:Common stock issued as payment for convertible debentures
    
    $
    940,940
    
    
    $
    
  F-5




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##### Table of Contents



SKYLYNX COMMUNICATIONS, INC.
 
 Notes to Consolidated Financial Statements
 (1) Summary of Significant Accounting Policies
 Organization and Basis of Presentation
     Name Change
 Business Combinations
 Business Combinations Goodwill and Other Intangible Assets
 F-6




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##### Table of Contents



F-7




---



##### Table of Contents



Principles of Consolidation
  Use of Estimates
  Cash and Cash Equivalents
  Property, Equipment and Depreciation
  F-8




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##### Table of Contents



Receivables
   Loan Costs
  Valuation of Goodwill, Intangible Assets and Long-Lived Assets
 Goodwill and Other Intangible Assets Accounting for the Impairment or Disposal of
Long-Lived Assets
  F-9




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##### Table of Contents



Income Taxes
 Accounting for Income
Taxes
 Revenue and Cost Recognition
  Sources of Supplies
  Loss per Share
  F-10




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##### Table of Contents



Stock-based Compensation
  Financial Instruments and Concentration of Credit Risk
   Research and Development
  F-11




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##### Table of Contents



Recent Accounting Pronouncements
 Share-based Payment
 Share-Based Payment
  Impairment of Debt and Equity Instruments
 The
Meaning of Other-Than-Temporary Impairment and Its Application to Certain Investments,
 F-12




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##### Table of Contents



(2) Related Party Transactions
  Loans payable to an officer, at interest of 12%, unsecured, due on demand
    
    $
    9,000Loans payable to a board member, at interest of 8%, unsecured, due on
demand
    
    
    2,800$
    11,800
    Number ofAmount of
    
    
    Shares if
    
    
    PriceDebenture
    
    
    Converted
    
    
    Per ShareGary L. Brown
    
    $
    100,000
    
    
    
    1,666,666
    
    
    $
    .06Kenneth L. Marshall
    
    
    50,000
    
    
    
    841,667
    
    
    $
    .06Clifford L. Neuman
    
    
    41,448
    
    
    
    690,800
    
    
    $
    .06Steven D. Smith
    
    
    50,000
    
    
    
    841,667
    
    
    $
    .06Total
    
    
    241,448
    
    
    
    4,040,800
 F-13




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##### Table of Contents



F-14




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##### Table of Contents



Number of
    
    
    Conversion
    
    
    Convertibleshares
    
    
    price
    
    
    debentureConvertible debenture issued to an officer
in exchange for loan and salary payables
    
    
    4,842,992
    
    
    $
    0.08
    
    
    $
    387,439Convertible debenture issued to officers
in exchange for loan and salary payables
    
    
    1,475,000
    
    
    $
    0.10
    
    
    
    147,500Convertible debenture issued to a board member
in exchange for loan payables*
    
    
    687,870
    
    
    $
    0.10
    
    
    
    68,787Convertible debenture issued to an outside counsel
in exchange for trade payables
    
    
    1,060,720
    
    
    $
    0.10
    
    
    
    106,0728,066,582
    
    
    
    
    
    
    $
    709,798
  (3) Property and Equipment
  Computers and shop equipment
    
    $
    31,345ISP equipment
    
    
    130,193Leasehold improvements
    
    
    2,220Software
    
    
    10,742174,500Less: accumulated depreciation
    
    
    (147,089
    )$
    27,411
  (4) Capital Stock
 Preferred Stock
  F-15




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##### Table of Contents



Common Stock Issuances
     Private Placement Memorandum dated August 31, 2003
  F-16




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##### Table of Contents



Stock Warrants
    Risk-free
interest rate
    
    
    4.35
    %Dividend
yield
    
    
    0.00
    %Volatility
    
    
    85.61
    %Weighted
average expected life
    
    
    3
    Years
  Options Outstanding
    
    
    Weighted AverageNumber of
    
    
    Exercise Price
    
    
    Exercise PriceShares
    
    
    Per Share
    
    
    Per ShareBalance at July 31,
2004
    
    
    436,823
    
    
    $
    3.00
    
    
    $
    3.00Awards
granted
    
    
    50,000
    
    
    $
    0.30
    
    
    $
    0.30Awards
exercised
    
    
    
    
    
    $
    0.00
    
    
    $
    Awards
cancelled/expired
    
    
    
    
    
    $
    0.00
    
    
    $
    Balance at July 31,
2005
    
    
    486,823
    
    
    $
    0.30 to $3.00
    
    
    $
    2.72
 F-17




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##### Table of Contents



(5) Income Taxes
  Year EndedJune 30,2005
    
    2004U.S. federal statutory graduated rate
    
    
    34.00
    %
    
    
    34.00
    %State income tax rate,
net of federal benefit
    
    
    5.74
    %
    
    
    5.83
    %Contributed rent
    
    
    0
    %
    
    
    -0.01
    %Net operating loss for which no tax
benefit is currently available
    
    
    -39.74
    %
    
    
    -39.82
    %0.00
    %
    
    
    0.00
    %
   F-18




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##### Table of Contents



(6) Commitments and Contingencies
  June 30,2006
    
    
    87,4662007
    
    
    80,8952008
    
    
    18,4202009
    
    
    15,385$
    202,166
    F-19




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##### Table of Contents



(7) Note payable
   (8) Acquisition of ADTECH Systems, Inc.
      F-20




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##### Table of Contents



(9) Subsequent Events
    F-21




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##### Table of Contents



ITEM 8. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND
FINANCIAL DISCLOSURE.
  
 ITEM 8A. CONTROLS AND PROCEDURES
   
 PART III
 
 ITEM 9. DIRECTORS, EXECUTIVE OFFICERS, PROMOTERS AND CONTROL PERSONS;
COMPLIANCE WITH SECTION
                16(a) OF THE EXCHANGE ACT
  Name
    
    Age
    
    PositionGary L. Brown
    
    
    57
    
    
    President, Chief Executive Officer, Chief Financial Officer, DirectorKenneth L. Marshall
    
    
    65
    
    
    Secretary and General CounselStephen L. Rogers
    
    
    62
    
    
    DirectorSteven D. Smith
    
    
    53
    
    
    Chief Operating Officer, DirectorAlfredo Chang
    
    
    33
    
    
    DirectorRobert Weiss
    
    
    54
    
    
    Director
 55




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##### Table of Contents



Gary L. Brown age 57, CEO, Board Member
 Kenneth L. Marshall age 65, Secretary and General Counsel-
 Stephen L. Rogers age 62, Board Member
 Steven D. Smith, age 53, Chief Operating Officer and Director,
 Alfredo Chang, age 33, Board Member,
 56




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##### Table of Contents



Robert Weiss, age 54,
     a.
    
    had any bankruptcy petition filed by or against any business of which such person
was a general partner or executive officer either at the time of the bankruptcy or
within two years prior to that time;b.
    
    been convicted in a criminal proceeding or subject to a pending criminal proceeding;c.
    
    been subject to any order, judgment, or decree, not subsequently reversed,
suspended or vacated, of any court of competent jurisdiction, permanently or
temporarily enjoining, barring, suspending or otherwise limiting his involvement in
any type of business, securities or banking activities; ord.
    
    been found by a court of competent jurisdiction in a civil action, the Commission
or the Commodity Futures Trading Commission to have violated a federal or state
securities or commodities law, and the judgment has not been reversed, suspended,
or vacated.
  Meetings and Committees of the Board of Directors
 a. Meetings of the Board of Directors
  57




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##### Table of Contents



b. Committees
   Audit Committee
  
    -
    
    reviews with management, the internal auditors and the independent auditors policies and
procedures with respect to internal controls;-
    
    reviews significant accounting matters;-
    
    approves the audited financial statements prior to public distribution;
 58




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##### Table of Contents



-
    
    approves any significant changes in accounting principles or financial reporting practices;-
    
    reviews independent auditor services; and-
    
    recommends to the board of directors the firm of independent auditors to audit our
consolidated financial statements.
  Audit Committee Report
       
 Compensation Advisory Committee
  
  -
    
    recommends to the board of directors the compensation and cash bonus
opportunities based on the achievement of objectives set by the
compensation advisory committee with respect to our chairman of the
board and president, our chief executive officer and the other
executive officers;-
    
    administers our compensation plans for the same executives;-
    
    determines equity compensation for all employees;-
    
    reviews and approves the cash compensation and bonus objectives for
the executive officers; and-
    
    reviews various matters relating to employee compensation and benefits.
 59




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##### Table of Contents



Nomination Process
      Shareholder Communications
   Code of Ethics
  Section 16(a) Compliance
  60




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##### Table of Contents



ITEM 10. EXECUTIVE COMPENSATION.
  TABLE 1
SUMMARY COMPENSATION TABLE
 Annual Compensation
    
    Long Term CompensationOtherAnnual
    
    OptionsName and Principal
    
    
    
    
    
    
    
    
    
    Compensation
    
    SARsPosition
    
    Fiscal
    
    Salary($)
    
    ($)(1)
    
    (#)2005
    
    
    $
    150,000
    (2)
    
    $
    -0-
    
    
    
    -0-Gary L. Brown,
    
    
    2004
    
    
    $
    75,000
    (2)
    
    $
    -0-
    
    
    
    -0-CEO and President
    
    
    2003
    
    
    $
    -0-
    
    
    $
    -0-
    
    
    
    -0-Kevin Gorman,
    
    
    2005
    
    
    $
    155,417
    (3)
    
    $
    -0-
    
    
    
    -0-Chief Operating Officer
    
    
    2004
    
    
    $
    -0-
    
    
    $
    -0-
    
    
    
    -0-2003
    
    
    $
    -0-
    
    
    $
    -0-
    
    
    
    -0-Jon Fatula,
    
    
    2005
    
    
    $
    119,167
    (4)
    
    $
    -0-
    
    
    
    -0-Vice President
    
    
    2004
    
    
    $
    -0-
    
    
    $
    -0-
    
    
    
    -0-2003
    
    
    $
    -0-
    
    
    $
    -0-
    
    
    
    -0-Steven D. Smith,
    
    
    2005
    
    
    $
    75,000
    (2)
    
    $
    -0-
    
    
    
    -0-Chief Operating Officer
    
    
    2004
    
    
    $
    -0-
    
    
    $
    -0-
    
    
    
    -0-2003
    
    
    $
    -0-
    
    
    $
    -0-
    
    
    
    -0-
 
 1.
    
    No executive officer will receive perquisites and other personal benefits, which, in the aggregate, exceeded the lesser
of either $50,000 or 10% of the total of annual salary and bonus paid during a fiscal year.2.
    
    Messrs. Brown and Marshall have been accruing salary since January 1, 2003 at the above-stated rate, due to the
Companys lack of funds.3.
    
    Mr. Gorman began receiving salary effective August 1, 2003 thru November 18, 2004.4.
    
    Mr. Fatula began receiving salary effective August 1, 2003 thru June 30, 2005.5.
    
    Mr. Smith began receiving salary effective January 1, 2005
 Company Equity Incentive Plan
  61




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##### Table of Contents



Table 2
Option/SAR Grants in Last Fiscal Year
Individual Grants
 % of TotalOptions/SARsGranted to
    
    Exercise orOptions/SARs
    
    Employees in
    
    Base PriceName
    
    Granted (#)
    
    Fiscal Year
    
    ($/Sh)
    
    Expiration DateGary L. Brown
    
    
    0
    
    
    
    0
    
    
    
    N/A
    
    
    
    N/AKevin Gorman
    
    
    0
    
    
    
    0
    
    
    
    N/A
    
    
    
    N/AJon Fatula
    
    
    0
    
    
    
    0
    
    
    
    N/A
    
    
    
    N/AFred Anderson
    
    
    0
    
    
    
    0
    
    
    
    N/A
    
    
    
    N/A
  Table 3
Aggregated Options/Sar Exercised In Last Fiscal Year
And Fy-End Option/Sar Values
 Value ofShares
    
    
    
    
    
    Number of Securities
    
    UnexercisedAcquired
    
    Value
    
    Underlying Unexercised
    
    In-the-Moneyon
    
    Realized
    
    Options at
    
    OptionsName
    
    Exercise
    
    ($)
    
    06/30/03
    
    at 6/30/03Exercisable/Unexercisable
    
    Exercisable/UnexercisableGary L. Brown
    
    
    0
    
    
    
    0
    
    
    
    0
    
    
    
    0Kevin Gorman
    
    
    0
    
    
    
    0
    
    
    
    0
    
    
    
    0
 62




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##### Table of Contents



Value ofShares
    
    
    
    
    
    Number of Securities
    
    UnexercisedAcquired
    
    Value
    
    Underlying Unexercised
    
    In-the-Moneyon
    
    Realized
    
    Options at
    
    OptionsName
    
    Exercise
    
    ($)
    
    06/30/03
    
    at 6/30/03Exercisable/Unexercisable
    
    Exercisable/UnexercisableJon Fatula
    
    
    0
    
    
    
    0
    
    
    
    0
    
    
    
    0Fred Anderson
    
    
    0
    
    
    
    0
    
    
    
    0
    
    
    
    0
 Employment agreements
     Indemnification and limitation on liability of directors
      63




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##### Table of Contents



ITEM 11. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT.
 (1)
 Number
    
    PercentName and Address(3)
    
    of Shares
    
    Owned(2)Gary L. Brown
    
    
    8,261,964
    
    
    
    27.59
    %Kenneth L. Marshall
    
    
    2,660,382
    
    
    
    8.9
    %Robert Weiss(4)
    
    
    370,000
    
    
    
    2.5
    %Kevin Gorman
    
    
    540,000
    
    
    
    3.7
    %Stephen Rogers
    
    
    514,287
    
    
    
    3.5
    %Alfredo Chang
    
    
    425,000
    
    
    
    2.9
    %Steven Smith
    
    
    1,091,667
    
    
    
    3.6
    %All Officers and Directors as a Group
(7 persons)
    
    
    13,863,300
    
    
    
    46.2
    %
 
 (1)
    
    Beneficial ownership is based on information provided to us, and the
beneficial owner has no obligation to inform us of or otherwise report any changes
in beneficial ownership. Except as indicated, and subject to community property laws
when applicable, the persons named in the table above have sole voting and
investment power with respect to all shares of common stock shown as beneficially
owned by them.(2)
    
    The percentages shown are calculated based upon 30,019,442 shares of
common stock outstanding. In calculating the percentage of ownership, unless as
otherwise indicated, all shares of common stock that the identified person or group
had the right to acquire within 60 days of the date of this Memorandum upon the
exercise of options and warrants or conversion of notes are deemed to be outstanding
for the purpose of computing the percentage of shares of common stock owned by such
person or group, but are not deemed to be outstanding for the purpose of computing
the percentage of the shares of common stock owned by any other person.(3)
    
    Unless otherwise stated, the beneficial owners address is 500 John
Ringling Blvd., Sarasota, FL 334236.(4)
    
    Includes 120,000 shares held of record by Black Knight Ventures,
Ltd., an investment banking firm controlled by Mr. Weiss and his wife. 64




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##### Table of Contents



ITEM 12. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS.
            65




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##### Table of Contents



Amount of
    
    
    Number of SharesName
    
    Debenture
    
    
    if Converted
    
    
    Price per ShareGary L. Brown
    
    $
    387,439
    
    
    
    4,842,984
    
    
    $
    .08Kenneth L. Marshall
    
    
    111,250
    
    
    
    1,112,500
    
    
    $
    .10Clifford L. Neuman
    
    
    106,073
    
    
    
    1,060,730,
    
    
    $
    .10Daniel J. Sullivan
    
    
    36,250
    
    
    
    362,497
    
    
    $
    .10Alfredo Chang
    
    
    68,788
    
    
    
    687,880
    
    
    $
    .10Total
    
    
    709,800
    
    
    
    8,066,591
  Amount of
    
    
    Number of SharesName
    
    Debenture
    
    
    if Converted
    
    
    Price per ShareGary L. Brown
    
    $
    100,000
    
    
    
    1,666,666
    
    
    $
    .06Kenneth L. Marshall
    
    
    50,000
    
    
    
    841,667
    
    
    $
    .06Clifford L. Neuman
    
    
    41,448
    
    
    
    690,800
    
    
    $
    .06Steven D. Smith
    
    
    50,000
    
    
    
    841,667
    
    
    $
    .06Total
    
    
    241,448
    
    
    
    4,040,800
  66




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##### Table of Contents



Amount ofDebentures
    
    
    Number of SharesName
    
    Converted
    
    
    IssuedGary L. Brown
    
    $
    487,438
    
    
    
    6,509,589Kenneth L. Marshall
    
    
    161,250
    
    
    
    2,043,167Steven D. Smith
    
    
    50,000
    
    
    
    841,667Total
    
    
    698,688
    
    
    
    9,394,423
 
 ITEM 13. EXHIBITS AND REPORTS ON FORM 8-K.
  Exhibit No.
    
    Title2.1
    
    
    Letter of Understanding dated December 13, 2001
(Incorporated by reference from Current Report
on Form 8-K filed May 15, 2002.2.2
    
    
    Option Agreement dated December 13, 2001
(Incorporated by reference from Current Report
on Form 8-K filed May 15, 2002.2.3
    
    
    Agreement and Plan of Reorganization between
Rover Telcom Corporation, Shareholders of Rover
Telcom Corporation and Basic Technologies, Inc.
(Incorporated by reference from Current Report
on Form 8-K filed September 9, 2002).2.4
    
    
    Asset Purchase and Lock-Up Agreement by and
Between Rover Group, Inc. and Inforum
Communications, Inc. (Incorporated by reference
from Current Report on Form 8-K Filed September
9, 2002)2.5
    
    
    Agreement and Plan of Merger between Basic
Technologies, Inc. and StarCom Wireless
Networks, Inc. (Incorporated by reference from
Current Report on Form 8-K Filed May 7, 2003)2.6
    
    
    Agreement And Plan Of Reorganization by and
Among SkyLynx Communications, Inc. Interim
Corporate Resources LLC (Incorporated by
reference from Current Report on Form 8-K filed
December 23, 2003)3.1.
    
    
    Certificate of Incorporation of StarCom
Wireless Networks, Inc. (Incorporated by
reference from Current Report on Form 8-K filed
May 7, 2003).3.2
    
    
    By-Laws of StarCom Wireless Networks, Inc.
(Incorporated by reference from Current Report
on Form 8-K filed May 7, 2003).3.3
    
    
    Certificate of Amendment to Certificate of
Incorporation changing the name of the Company
to SkyLynx Communications, Inc. (Incorporated
by reference from Current Report on Form 8-K
filed September 29, 2003).3.4
    
    
    Articles of Incorporation of Rover Telcom
Corporation (Incorporated by reference from
Current Report on Form 8-K filed September 9,
2002).3.5
    
    
    By-Laws of Rover Telcom Corporation
(Incorporated by reference from Current Report
on Form 8-K Filed September 9, 2002)9.0
    
    
    Trust Agreement dated June 15, 2002
(Incorporated by reference from Annual Report
on Form 10-KSB dated June 30, 2002 filed on
October 15, 2002.10.1
    
    
    Press Release dated July 17, 2003 Announces
Termination Of Letter Of Intent And New Strategic Direction (Incorporated by reference
from Current Report on Form 8-K filed July 17, 2003)
 67




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##### Table of Contents



Exhibit No.
    
    Title10.2
    
    
    SkyLynx Communications, Inc. 2002 Equity
Incentive Plan (Incorporated by reference from
Registration Statement on Form S-8 filed
December 8, 2003)10.3
    
    
    Consultation and Securities Compensation
Agreement between the Company and Carl Dilley
dated November 4, 2003 (Incorporated by
reference from Registration Statement on Form
S-8 filed December 8, 2003)10.4
    
    
    Consultation and Securities Compensation
Agreement between the Company and Clifford L.
Neuman dated November 4, 2003 (Incorporated by
reference from Registration Statement on Form
S-8 filed December 8, 2003)10.5
    
    
    Common Stock Purchase Agreement between Gus
Yepes and SkyLynx Communications, Inc.
(Incorporated by reference from Current Report
on Form 8-K filed May 14, 2004)10.6
    
    
    Agreement between Inversiones Sinalco, S.A.,
IdNet, S.A., and SkyLynx Communications Inc. .
(Incorporated by reference from Current Report
on Form 8-K filed May 14, 2004)10.7
    
    
    Escrow Agreement between Gus Yepes and SkyLynx
Communications, Inc. . (Incorporated by
reference from Current Report on Form 8-K filed
May 14, 2004)10.8
    
    
    AVL Business Brochure (Incorporated by
reference from Current Report on Form 8-K filed
June 29, 2004)*
    
    
    14.1
    
    
    Code of Ethics17
    
    
    Resignation letter From Steven S. Jesson dated
September 2, 2004 (Incorporated by reference
from Current Report on Form 8-K filed September
3, 2004)31.
    
    
    Certification32.
    
    
    Certification pursuant to 18 U.S.C. Section 1350
 
 *
    
    Previously filed. (b)
    
    Reports on Form 8-KCurrent Report on Form 8-K dated April 19, 2005, Items 1.01,
2.01 and 9.01, as filed with the Commission on April 25, 2005.Current Report on Form 8-K dated May 2, 2005, Items 1.01, 8.01
and 9.01, as filed with the Commission on May 5, 2005.Current Report on Form 8-K dated May 4, 2005, Items 3.02 and
9.01, as filed with the Commission on May 9, 2005.Current Report on Form 8-K dated May 27, 2005, Items 1.01 and
9.01, as filed with the Commission on May 31, 2005.Current Report on Form 8-K dated June 27, 2005, Items 8.01 and
9.01, as filed with the Commission on June 29, 2005.Current Report on Form 8-K dated August 2, 2005, Items 3.02 and
9.01, as filed with the Commission on August 8, 2005.
 68




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##### Table of Contents



Current Report on Form 8-K dated January 2, 2005, Item3.02, as
filed with the Commission on August 17, 2005.Current Report on Form 8-K dated August 15, 2005, Item 1.02, as
filed with the Commission on August 22, 2005.Current Report on Form 8-K dated September 28, 2005, Item 5.02,
as filed with the Commission on September 29, 2005.Current Report on Form 8-K dated November 10, 2004, Items 1.01,
4.01 and 9.01, as filed with the Commission on November 3,
2005.
 
 ITEM 14. PRINCIPAL ACCOUNTANTS FEES AND SERVICES
    2005
    
    
    2004Audit fees  audit of annual financial statements and
review of financial statements included in our
quarterly reports, services normally provided by the
accountant in connection with statutory and regulatory
filings.
    
    $
    22,822
    
    
    $
    19,409Audit-related fees  related to the performance of
audit or review of financial statements not reported
under audit fees above
    
    
    
    
    
    
    Tax fees  tax compliance, tax advice and tax planning
    
    
    
    
    
    
    All other fees  services provided by our principal
accountants other than those identified above
    
    
    
    
    
    
    11,123Total fees paid or accrued to our principal accountants
    
    $
    22,822
    
    
    $
    30,532
 69




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##### Table of Contents



SIGNATURES
  SKYLYNX COMMUNICATIONS, INC.Date:
November 30, 2005
    
    By:
    
    /s/ Gary L. BrownGary L. Brown, Chief Executive Officer
  Signature
    
    Title
    
    Date/s/ Gary L. Brown
    
    Chief Executive Officer and Director
    
    November 30, 2005Gary L. Brown
    
    (Principal Executive Officer)Chief Financial Officer(Principal Financial andAccounting Officer)/s/ Steven D. SmithSteven D. Smith
    
    Director
    
    November 30, 2005/s/ Stephen L. RogersStephen L. Rogers
    
    Director
    
    November 30, 2005/s/ Robert D. WeissRobert D. Weiss
    
    Director
    
    November 30, 2005/s/ Alfredo ChangAlfredo Chang
    
    Director
    
    November 30, 2005
 70




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##### Table of Contents



EXHIBIT INDEX
 Exhibit No.
    
    Title2.1
    
    
    Letter of Understanding dated December 13, 2001
(Incorporated by reference from Current Report
on Form 8-K filed May 15, 2002.2.2
    
    
    Option Agreement dated December 13, 2001
(Incorporated by reference from Current Report
on Form 8-K filed May 15, 2002.2.3
    
    
    Agreement and Plan of Reorganization between
Rover Telcom Corporation, Shareholders of Rover
Telcom Corporation and Basic Technologies, Inc.
(Incorporated by reference from Current Report
on Form 8-K filed September 9, 2002).2.4
    
    
    Asset Purchase and Lock-Up Agreement by and
Between Rover Group, Inc. and Inforum
Communications, Inc. (Incorporated by reference
from Current Report on Form 8-K Filed September
9, 2002)2.5
    
    
    Agreement and Plan of Merger between Basic
Technologies, Inc. and StarCom Wireless
Networks, Inc. (Incorporated by reference from
Current Report on Form 8-K Filed May 7, 2003)2.6
    
    
    Agreement And Plan Of Reorganization by and
Among SkyLynx Communications, Inc. Interim
Corporate Resources LLC (Incorporated by
reference from Current Report on Form 8-K filed
December 23, 2003)3.1.
    
    
    Certificate of Incorporation of StarCom
Wireless Networks, Inc. (Incorporated by
reference from Current Report on Form 8-K filed
May 7, 2003).3.2
    
    
    By-Laws of StarCom Wireless Networks, Inc.
(Incorporated by reference from Current Report
on Form 8-K filed May 7, 2003).3.3
    
    
    Certificate of Amendment to Certificate of
Incorporation changing the name of the Company
to SkyLynx Communications, Inc. (Incorporated
by reference from Current Report on Form 8-K
filed September 29, 2003).3.4
    
    
    Articles of Incorporation of Rover Telcom
Corporation (Incorporated by reference from
Current Report on Form 8-K filed September 9,
2002).3.5
    
    
    By-Laws of Rover Telcom Corporation
(Incorporated by reference from Current Report
on Form 8-K Filed September 9, 2002)9.0
    
    
    Trust Agreement dated June 15, 2002
(Incorporated by reference from Annual Report
on Form 10-KSB dated June 30, 2002 filed on
October 15, 2002.10.1
    
    
    Press Release dated July 17, 2003 Announces
Termination Of Letter Of Intent And New Strategic Direction (Incorporated by reference
from Current Report on Form 8-K filed July 17, 2003)




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##### Table of Contents



Exhibit No.
    
    Title10.2
    
    
    SkyLynx Communications, Inc. 2002 Equity
Incentive Plan (Incorporated by reference from
Registration Statement on Form S-8 filed
December 8, 2003)10.3
    
    
    Consultation and Securities Compensation
Agreement between the Company and Carl Dilley
dated November 4, 2003 (Incorporated by
reference from Registration Statement on Form
S-8 filed December 8, 2003)10.4
    
    
    Consultation and Securities Compensation
Agreement between the Company and Clifford L.
Neuman dated November 4, 2003 (Incorporated by
reference from Registration Statement on Form
S-8 filed December 8, 2003)10.5
    
    
    Common Stock Purchase Agreement between Gus
Yepes and SkyLynx Communications, Inc.
(Incorporated by reference from Current Report
on Form 8-K filed May 14, 2004)10.6
    
    
    Agreement between Inversiones Sinalco, S.A.,
IdNet, S.A., and SkyLynx Communications Inc. .
(Incorporated by reference from Current Report
on Form 8-K filed May 14, 2004)10.7
    
    
    Escrow Agreement between Gus Yepes and SkyLynx
Communications, Inc. . (Incorporated by
reference from Current Report on Form 8-K filed
May 14, 2004)10.8
    
    
    AVL Business Brochure (Incorporated by
reference from Current Report on Form 8-K filed
June 29, 2004)*
    
    
    14.1
    
    
    Code of Ethics17
    
    
    Resignation letter From Steven S. Jesson dated
September 2, 2004 (Incorporated by reference
from Current Report on Form 8-K filed September
3, 2004)31.
    
    
    Certification32.
    
    
    Certification pursuant to 18 U.S.C. Section 1350
 
 *
    
    Previously filed.