<PAGE>

                       SECURITIES AND EXCHANGE COMMISSION
                              WASHINGTON, DC 20549

                                    FORM 10-Q


/X/      QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15 (D) OF THE SECURITIES
         EXCHANGE ACT OF 1934 FOR THE PERIOD ENDED MARCH 31, 2000
OR

/ /      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 0-27604

                            PICK Communications Corp.
           (Exact name of the registrant as specified in its charter)

            NEVADA                                         75-2107261
(State or other jurisdiction of                         (I.R.S. employer
Incorporation or Organization)                         identification no.)

8401 N.W. 53rd Terrace, Suite 119, Miami, FL                33166
(Address of principal executive offices)                  (Zip Code)

Registrant's Telephone number, including area code:  (305) 717-1500

Indicate by check mark whether the registrant (1) has filed reports to be filed
by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the
preceding 12 months (or for shorter period that the registrant was required to
file such reports), and (2) has been subject to such filing requirements for the
past 90 days. Yes No x

As of August 18, 2000, the Registrant had 10,670,569 shares of Common Stock,
$.01 par value, outstanding.

<PAGE>

                            PICK Communications Corp.

This Report includes forward-looking statements within the meaning of Section
27A of the Securities Act of 1933, as amended, and Section 21E of the Securities
Exchange Act of 1934, as amended, including statements regarding expected future
revenues and expenses. Forward-looking statements relate to plans and
expectations of the Company and are subject to risks and uncertainties,
including the Company's ability to implement its new business plan and strategy
and launch its PICK Sat services, the Company's need for additional funding, the
repayment of substantial short-term indebtedness, contingent liabilities of the
Company on its discontinued operations, significant and continuing losses,
dependence on a limited number of customers, dependence on the Internet, the
timely development and acceptance of new products in a constantly evolving
Internet industry, the impact of competitive products and pricing, government
regulations and other risks detailed from time to time in the Company's SEC
reports.

<TABLE>
<CAPTION>
                               Index to Form 10-Q

                                                                                                      Page Number
<S>          <C>                                                                                        <C>
PART I       Financial Information

Item 1.      Financial Statements

             Consolidated Balance Sheet as at March 31, 2000 (Unaudited) and December 31, 1999.......... 3

             Consolidated  Statement of Operations for the three-month
             period ended March 31, 2000 and 1999 (Unaudited)........................................... 4

             Consolidated Statement of Stockholders' Deficiency
             for the three-month period ended March 31, 2000 (Unaudited)................................ 5

             Consolidated Statement of Cash Flows for the
             three-month periods ended March 31, 2000 and 1999 (Unaudited).............................. 6

             Notes to Consolidated Financial Statements (Unaudited).................................. 7-15

Item 2.      Management's Discussion and Analysis of Financial Condition
             and Results of Operations.............................................................. 16-22

Part II.          Other Information.................................................................... 23

Item 1.           Legal Proceedings.................................................................... 23

Item 2.           Changes in Securities................................................................ 23

Item 6.           Exhibits and Reports on Form 8-K..................................................... 23

                  Signatures........................................................................... 24
</TABLE>
<PAGE>

                   PICK COMMUNICATIONS CORP. AND SUBSIDIARIES
                           CONSOLIDATED BALANCE SHEET

<TABLE>
<CAPTION>

                                                                                     March 31, 2000       December 31, 1999
                                                                                     --------------       -----------------
                                                                                      (Unaudited)
<S>                                                                                  <C>                   <C>
ASSETS

Current Assets:
  Prepaid expenses and other current assets                                           $     149,283         $     176,455
  Current assets from discontinued operations                                               119,926               325,220
                                                                                      -------------         -------------
      Total current assets                                                                  269,209               501,675
                                                                                      -------------         -------------

Property and Equipment - at cost, net of accumulated depreciation
 of $263,010 and $214,527, respectively                                                   4,469,830             4,434,970
                                                                                      -------------         -------------

Other Assets:
  Security deposits                                                                         244,613               261,796
  Deferred income tax asset, net of valuation allowance of $31,151,000
   and $30,509,000, respectively                                                                 --                    --
  Long-term assets from discontinued operations                                           2,131,858             2,068,394
                                                                                      -------------         -------------
      Total other assets                                                                  2,376,471             2,330,190
                                                                                      -------------         -------------
      Total Assets                                                                    $   7,115,510         $   7,266,835
                                                                                      =============         =============

LIABILITIES AND STOCKHOLDERS' DEFICIENCY
Current Liabilities:
  Cash overdraft                                                                      $      42,458         $      20,193
  Current portion of debt                                                                 1,623,458               888,000
  Accounts payable and accrued expenses                                                   9,008,145             8,540,607
  Current liabilities from discontinued operations                                       11,890,985            10,965,614
                                                                                      -------------         -------------
      Total current liabilities                                                          22,565,046            20,414,414

Debt, less current portion                                                                9,880,000             9,880,000
Long-term Liabilities from Discontinued Operations                                               --               736,586
                                                                                      -------------         -------------
      Total liabilities                                                                  32,445,046            31,031,000
                                                                                      -------------         -------------

Commitments and Contingencies

Minority Interest in Consolidated Subsidiary                                                 84,276                84,276
                                                                                      -------------         -------------

Stockholders' Deficiency:
  Preferred stock - $.001 par value; authorized 10,000,000 shares;
   2,000,000 shares designated as Series B convertible preferred
   stock, aggregate liquidation value - $1,871,000, issued 1,871,000 shares:
   505,000 shares and 930,000 shares outstanding, respectively                              505,000               930,000
  500,000 shares designated as Series D convertible preferred stock, aggregate
   liquidation value - $4,660,000, issued 500,000 shares: 190,500 shares and
   260,500 shares outstanding, respectively                                               1,905,000             2,605,000
  Common stock - $.01 par value; authorized 40,000,000 shares,
   respectively; issued 9,931,616 and 8,919,881 shares, respectively                         99,352                89,234
  Additional paid-in capital                                                             80,861,110            79,746,228
  Options and warrants                                                                    2,720,071             2,720,071
  Subscription receivable                                                                  (340,000)             (340,000)
  Treasury stock, at cost, 3,550 shares                                                     (11,978)              (11,978)
  Accumulated Other Comprehensive Income                                                      1,482                 1,482
  Accumulated deficit                                                                  (111,153,849)         (109,588,478)
                                                                                      -------------         -------------
      Stockholders' deficiency                                                          (25,413,812)          (23,848,441)
                                                                                      -------------         -------------
      Total Liabilities and Stockholders' Deficiency                                  $   7,115,510         $   7,266,835
                                                                                      =============         =============

</TABLE>


                 See Notes to Consolidated Financial Statements


                                      -3-
<PAGE>

                   PICK COMMUNICATIONS CORP. AND SUBSIDIARIES
                     CONSOLIDATED STATEMENTS OF OPERATIONS
                                  (UNAUDITED)

<TABLE>
<CAPTION>

                                                                                   FOR THE THREE MONTHS
                                                                                      ENDED MARCH 31,
                                                                                    2000           1999
                                                                                -----------     -----------
<S>                                                                            <C>             <C>
Costs and expenses:
Selling, general and administrative                                             $   875,022     $   977,208
Depreciation and amortization                                                        48,483          14,574
                                                                                -----------     -----------
Operating loss                                                                      923,504         991,782
                                                                                -----------     -----------

Other expense:
Interest expense                                                                    570,932         479,423
Settlement of expenses                                                             (293,977)             --
                                                                                -----------     -----------
Total other expense                                                                 276,955         479,423
                                                                                -----------     -----------

Loss from continuing operations before minority interest in subsidiary loss,
 and discontinued operations                                                      1,200,460       1,471,205

                                                                                -----------     -----------
Loss from continuing operations                                                   1,200,460       1,471,205
                                                                                -----------     -----------

Loss from discontinued operations                                                   364,911       1,845,039

                                                                                -----------     -----------
Net loss                                                                          1,565,371       3,316,244
                                                                                -----------     -----------

Beneficial conversion feature of preferred stock                                         --       3,570,000

                                                                                -----------     -----------
Net loss applicable to common stock                                               1,565,371       6,886,244
                                                                                ===========     ===========

Loss from continuing operations and beneficial conversion
 feature of preferred stock per common share - basic and diluted                       0.13            1.21
                                                                                ===========     ===========

Loss from discontinued operations per common share - basic and diluted                 0.04            0.44
                                                                                ===========     ===========

Net loss applicable to common stock per share - basic and diluted                      0.16            1.65
                                                                                ===========     ===========

Weighted-average shares outstanding - basic and diluted                           9,552,727       4,161,023
                                                                                ===========     ===========

</TABLE>


                 See Notes to Consolidated Financial Statements


                                      -4-
<PAGE>

                   PICK COMMUNICATIONS CORP. AND SUBSIDIARIES
               CONSOLIDATED STATEMENT OF STOCKHOLDERS' DEFICIENCY
                                  (UNAUDITED)

<TABLE>
<CAPTION>

                                                             Series B                   Series D
                                                          Preferred Stock            Preferred Stock            Common Stock
                                                       ----------------------    ------------------------    -------------------
                                                        Shares       Amount       Shares        Amount        Shares     Amount
                                                       ---------    ---------    ---------    -----------    ---------   -------

<S>                                                    <C>          <C>            <C>        <C>            <C>         <C>
 Balance at December 31, 1999                            930,000    $ 930,000      260,500    $ 2,605,000    8,919,881   $89,234

 Issuance of common stock in connection with old debt       --           --           --             --         50,000       500
 Conversion of common stock from preferred stock        (425,000)    (425,000)     (70,000)      (700,000)     775,000     7,750
 Issuance of common stock upon exercise of warrants         --           --           --             --        186,735     1,867
 Net loss                                                   --           --           --             --           --        --
                                                       ---------    ---------    ---------    -----------    ---------   -------
 Balance at March 31, 2000                               505,000    $ 505,000      190,500    $ 1,905,000    9,931,616   $99,352
                                                       =========    =========    =========    ===========    =========   =======

<CAPTION>

                                                                                                                      Accumulated
                                                         Additional       Options                                        Other
                                                          Paid-in          and           Stock          Treasury     Comprehensive
                                                          Capital        Warrants     Subscriptions      Stock           Income
                                                       ------------    ------------   -------------  ------------    ------------
<S>                                                    <C>             <C>            <C>             <C>             <C>
 Balance at December 31, 1999                          $ 79,746,228    $  2,720,071   $   (340,000)   $    (11,978)   $      1,482

 Issuance of common stock in connection with old debt          (500)           --             --              --             --
 Conversion of common stock from preferred stock          1,117,250            --             --              --             --
 Issuance of common stock upon exercise of warrants
 Net loss                                                    (1,867)           --             --              --             --
                                                       ------------    ------------   ------------    ------------    ------------
 Balance at March 31, 2000                             $ 80,861,110    $  2,720,071   $   (340,000)   $    (11,978)   $      1,482
                                                       ============    ============   ============    ============    ============

<CAPTION>

                                                        Accumulated      Shareholders'
                                                          Deficit         Deficiency
                                                       -------------    -------------
<S>                                                    <C>              <C>
 Balance at December 31, 1999                          $(109,588,478)   $ (23,848,441)

 Issuance of common stock in connection with old debt           --               --
 Conversion of common stock from preferred stock                --               --
 Issuance of common stock upon exercise of warrants             --               --
 Net loss                                                 (1,565,371)      (1,565,371)
                                                       -------------    -------------
 Balance at March 31, 2000                             $(111,153,849)   $ (25,413,812)
                                                       =============    =============

</TABLE>


                 See Notes to Consolidated Financial Statements


                                      -5-
<PAGE>

                   PICK COMMUNICATIONS CORP. AND SUBSIDIARIES
                      CONSOLIDATED STATEMENT OF CASH FLOWS
                                   (UNAUDITED)

<TABLE>
<CAPTION>

For the Three months ended March 31,                                                        2000                1999
------------------------------------                                                     -----------         -----------
<S>                                                                                  <C>                 <C>
Cash flows from operating activities:
Net loss                                                                              (1,565,371)         (3,316,244)
Adjustments to reconcile net loss to net cash used in operating activities:
  Stock, options and warrants issued for compensation or services                             --             232,761
  Amortization of debt discount and debt placement expenses                                   --              32,026
  Depreciation and amortization                                                           48,483             108,773
Bad debt expense                                                                              --              35,528
Changes in operating assets and liabilities:
 Decrease in prepaid expenses and other current assets                                    27,172                  --
 Increase in accounts receivable                                                              --             (17,784)
 Decrease in other assets                                                                     --             102,990
 Decrease in current assets from discontinued operations                                 205,294                  --
 Decrease in security deposits                                                            17,183                  --
 Increase in long-term assets from discontinued operations                               (63,464)                 --
 Increase in accounts payable and accrued expenses                                       467,538           3,721,209
 Decrease in deferred revenues                                                                --            (781,407)
 Decrease in other current liabilities                                                        --            (810,000)
 Increase in current liabilities from discontinued operations                            925,371                  --
 Decrease in long-term liabilities from discontinued operations                         (736,586)                 --


                                                                                     -----------         -----------
    Net cash used in operating activities                                               (674,380)           (692,148)
                                                                                     -----------         -----------



                                                                                     -----------         -----------
Cash flows used in investing activity - purchase of property and equipment               (83,343)           (414,002)
                                                                                     -----------         -----------

Cash flows from financing activities:
  Funds advanced on third-party debt, net of cash placement costs                        735,458                  --
  Proceeds from issuance of Series B preferred stock                                          --             965,000
  Payment of preferred stock issuance cost                                                    --             (64,908)
  Increase in cash overdraft                                                              22,265                  --
                                                                                     -----------         -----------
    Net cash provided by financing activities                                            757,723             900,092
                                                                                     -----------         -----------

Net decrease in cash                                                                          --            (206,058)

Cash at beginning of period                                                                   --             248,551
                                                                                     -----------         -----------
Cash at end of period                                                                $        --         $    42,493
                                                                                     ===========         ===========

Supplemental disclosure of cash flow information:
Cash paid during the period for interest from:
  Continuing operations                                                              $        --         $        --
  Discontinued operations                                                                     --              67,824
                                                                                     ===========         ===========


Supplemental schedule of noncash investing and financing activities:
Deferred interest from issuance of stock and options                                 $        --         $   750,163
                                                                                     ===========         ===========

</TABLE>


                 See Notes to Consolidated Financial Statements



                                      -6-
<PAGE>

                                      PICK COMMUNICATIONS CORP. AND SUBSIDIARIES

                                      NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

                                                                     (UNAUDITED)
--------------------------------------------------------------------------------

1. PRINCIPAL BUSINESS ACTIVITY AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES:

PICK Communications Corp. and Subsidiaries (collectively, the "Company") provide
satellite-based internet access and interactive multimedia services to end-user
service providers. In March 1999, the Company formed a new subsidiary, PICK
Online.Com Inc., a media content aggregator using a satellite-based multicast
delivery system for internet service providers and broadband networks. The
Company is headquartered and leases facilities in Miami, Florida.

The accompanying consolidated financial statements include the accounts of PICK
Communications Corp. and its wholly owned subsidiaries, PICK US Inc. f/k/a PICK
Inc. ("PICK US"), PICK Net Inc. ("PICK Net"), PICK Net UK PLC ("PICK Net UK"),
PICK Sat Inc. ("PICK Sat"), PICK Online.Com Inc. ("POL") and P.C.T. Prepaid
Telephone Inc. ("PCT"), a majority-owned subsidiary. All significant
intercompany balances and transactions have been eliminated.

The Company has discontinued the operations of its telecommunication and prepaid
calling card business consisting of PICK US, PICK Net and PICK Net UK (see
Note 7).

Minority interest represents the minority stockholders' proportionate share of
the equity and loss of PCT.

Revenue from PICK Sat will be derived from monthly fees charged based upon the
type of usage and bandwidth contracted for, while sales from POL will be derived
from subscribers ratably over the contract period. For the three months ended
March 31, 2000, both PICK Sat and POL had no revenue and no customers. Revenue
from the discontinued operations are recognized at the time that the service is
provided, for long-distance time, as reported by the electronic switching
devices, and for prepaid calling cards as the card is used.


For comparability, certain 1999 amounts have been reclassified, where
appropriate, to conform to the financial statement presentation used in 2000.

Effective July 23, 1999, the Company's board of directors authorized a 1-for-10
reverse split of its common stock . All share and per-share amounts in these
consolidated financial statements have been restated to give effect to this
reverse stock split.

2. PREPAID EXPENSES AND OTHER CURRENT ASSETS:

Prepaid expenses and other current assets consist of the following:


                                               March 31,            December 31,
                                                 2000                  1999
--------------------------------------------------------------------------------
                                              (Unaudited)

Sundry receivable                              $  4,127              $  3,100
Computer equipment for resale                    75,120                58,159
Prepaid expenses                                 20,036                61,851
Advances and other current assets                50,000                53,345
--------------------------------------------------------------------------------
                                               $149,283              $176,455
================================================================================


                                      -7-
<PAGE>

                                      PICK COMMUNICATIONS CORP. AND SUBSIDIARIES

                                      NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

                                                                     (UNAUDITED)
--------------------------------------------------------------------------------
3. PPROPERTY AND EQUIPMENT:


Property and equipment, at cost, consists of the following:
<TABLE>
<CAPTION>

                                           March 31,      December 31,        Estimated
                                             2000            1999            Useful Life
------------------------------------------------------------------------------------------
                                          (Unaudited)
<S>                                       <C>             <C>              <C>
Property, equipment and software          $   630,653     $   567,543      3 and 5 years
Asset development/
 installation-in-process                    4,102,187       4,081,954
------------------------------------------------------------------------------------------

                                            4,732,840       4,649,497
Less accumulated depreciation
 and amortization                             263,010         214,527
------------------------------------------------------------------------------------------
                                           $4,469,830      $4,434,970
==========================================================================================
</TABLE>

Asset development/installation-in-process consists of hardware and software
costs related to the Company's high-speed internet business, which is under
development. Depreciation will commence when the development and/or installation
is complete and the assets are fully operational.

4. DEBT:

Debt consists of the following:

                                               March 31,           December 31,
                                                 2000                 1999
--------------------------------------------------------------------------------
                                              (Unaudited)

Private placement debt (a)                   $  9,880,000         $  9,880,000
Note payable  (b)                                 476,000              476,000
Revolver loan (c)                               1,147,458              412,000
--------------------------------------------------------------------------------

                                               11,503,458           10,768,000

Less current portion of debt                    1,623,458              888,000

--------------------------------------------------------------------------------
        Debt, less current portion           $  9,880,000         $  9,880,000
================================================================================

(a) Between July 29, 1998 and September 8, 1998, the Company, through
    Commonwealth Associates ("Commonwealth"), placed $9,900,000 (face amount) of
    10%, 120-day Senior Secured Notes (the "Original Notes") and 9,900,000
    warrants to purchase 990,000 shares of the Company's common stock at $5.00
    per share for five years (the "Placement"). The Original Notes are secured
    by all the assets of PICK Communications Corp. The Company allocated



                                      -8-
<PAGE>

                                      PICK COMMUNICATIONS CORP. AND SUBSIDIARIES

                                      NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

                                                                     (UNAUDITED)
--------------------------------------------------------------------------------
    $8,587,066 of the gross sales proceeds to the debt and $1,312,934 to the
    warrants. The $1,312,934 discount was amortized as interest expense over the
    original 120-day life of the Original Notes. In November and December 1998,
    the Company exercised its rights to extend the maturity date of the Original
    Notes for 60 days. Under the terms of the Original Notes, the interest rate
    of the Original Notes was increased to 18% per annum, retroactive to the
    issuance of the Original Notes. In January, February and March 1999, the
    holders of the Original Notes agreed to extend the maturity of the Original
    Notes until April 27, 1999. In return for the extensions, the Company agreed
    to issue 50,012 shares of its common stock (valued at $265,063 and included
    in loss from discontinued operations in the accompanying consolidated
    statement of operations) and warrants (valued at $485,100 and included in
    loss from discontinued operations in the accompanying consolidated statement
    of operations) to purchase 245,750 shares of the Company's common stock for
    five years at $5.00 per share to the holders of the Original Notes.

    For the placement of the Original Notes, the Company paid Commonwealth and
    Liberty Capital (the Company's co-financial advisor) $1,099,000 in cash,
    issued 139,437 shares of common stock (valued at $865,799) and warrants to
    purchase 250,986 shares of common stock at $5.00 per share (valued at
    $383,002) for five years. The costs related to the Placement were being
    deferred and amortized as debt placement expenses over the term of the debt.

    On April 27, 1999, the holders of the Original Notes, who control in excess
    of 99% of the principal which was due on April 27, 1999, consented to
    restructure their Original Notes (the "Restructured Notes") and extend the
    maturity date until April 27, 2002. Additionally, the Company has the option
    to extend the maturity date for one year. Under the terms of the
    restructuring, the Restructured Notes were initially convertible into shares
    of common stock at a fixed price of $10.00 rather than fair market value
    (valued at $7,077,600), as defined in the terms of restructuring. The
    Restructured Notes automatically convert to common stock if the closing bid
    price exceeds $15.00 per share, as defined. In January 2000, as a result of
    anti-dilution provision of the Restructured Notes the conversion rate was
    reduced to $5 per share.

    In consideration for the restructuring, the consenting noteholders received
    the following:

    (i)  the right for a two-year period to exchange the existing warrants for
         an aggregate of 988,000 shares of the Company's common stock for no
         consideration (valued at $15,604,800);

    (ii) the right to receive from the Company an aggregate of 988,000 new
         shares of the Company's common stock for no consideration (valued at
         $16,907,600).

    During 1999, 1,976,000 shares were issued to the consenting noteholders.

    In consideration for the restructuring of the Original Notes, the Company
    issued to Commonwealth 200,000 shares of common stock (valued at $3,440,000
    and included in loss on disposal of discontinued operations in the
    accompanying statement of operations) plus warrants to purchase 50,000 of
    the Company's common stock at $13.75 per share (valued at $239,477 and
    included in loss on disposal of discontinued operations in the accompanying
    statement of operations). Additionally, warrants previously issued to
    Commonwealth will be exercisable at $1.00 per share (valued at $2,046,097
    and included in additional paid-in capital in the accompanying consolidated
    balance sheet).


                                      -9-
<PAGE>

                                      PICK COMMUNICATIONS CORP. AND SUBSIDIARIES

                                      NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

                                                                     (UNAUDITED)
--------------------------------------------------------------------------------

    Due to the restructuring of the $9,900,000 short-term notes, the Company
    recorded an increase in stockholders' deficiency of $41,636,097 during 1999.

    All deferred interest and placement charges were written off and included in
    the loss on disposal of discontinued operations during 1999.

(b) PICK Sat obtained a promissory note from Atlantic Tele-Network Inc. ("ATN")
    aggregating $476,000, which loan bears interest at prime plus 2% (11% at
    March 31, 2000). This promissory note was entered into in connection with
    PICK Sat options as described in the PICK Sat option agreement dated
    September 13, 1999. ATN chose not to exercise this option and the promissory
    note became due and payable on February 4, 2000 and has not been paid. On
    January 4, 2000, in consideration of the then pending completion of the sale
    of the Company's PICK Net subsidiaries (see Note 7), as well as the
    termination of the PICK Sat option, ATN received five-year warrants to
    purchase 1,000,000 shares of PICK common stock exercisable at $2.00 per
    share.

(c) On November 3, 1999, PICK Sat entered into a 120-day revolver for $500,000
    (the "Revolver") from Tri-Links Investment Trust ("Tri-Links"). At
    December 31, 1999, PICK Sat borrowed $412,000 under the Revolver which bears
    interest at 13% per annum, increasing to 15% per annum upon default and
    payment of which is guaranteed by PICK. Tri-Links was granted a security
    interest in substantially all of PICK Sat's assets which was initially
    subordinated to ATN and then made pari passu and equal in priority as of
    April 2000. The Revolver came due on March 3, 2000 and was extended until
    May 3, 2000. In addition, on January 26, 2000, Tri-Links, PICK and PICK Sat
    entered into an Amendment Agreement which was amended again in March and
    April 2000, whereby the commitment under the Revolver was eventually
    increased to $1,400,000. The loan payable balance at March 31, 2000 amounted
    to $1,147,458. In connection with the Revolver, PICK agreed to use its best
    efforts to cause four designees of Tri-Links to be elected to the PICK board
    of directors. Tri-Links was issued warrants to purchase 2.5% to the issued
    and outstanding common stock of PICK Sat on a fully diluted basis. Group
    Technology was assigned Tri-Link's right to elect two of the four directors
    and its assignee was given warrants to purchase 2.5% of the issued and
    outstanding common stock of PICK Sat on a fully diluted basis.

5. ACCOUNTS PAYABLE AND ACCRUED EXPENSES:

 Accounts payable and accrued expenses consist of the following:

                                                       March 31,    December 31,
                                                         2000          1999
--------------------------------------------------------------------------------
                                                      (Unaudited)
Accounts payable - operating                          $2,086,274     $2,323,613
Accrued expenses - operating                           2,892,907      2,188,030
Accrued expenses - for equipment                       1,066,000      1,066,000
Accrued expenses - settlement reserves (see Note 8)    2,962,964      2,962,964
--------------------------------------------------------------------------------
                                                      $9,008,145     $8,540,607
================================================================================



                                      -10-
<PAGE>

                                      PICK COMMUNICATIONS CORP. AND SUBSIDIARIES

                                      NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

                                                                     (UNAUDITED)
--------------------------------------------------------------------------------

6. PREFERRED STOCK:

In March 1999, the board of directors authorized the issuance of 2,000,000
shares of Series B convertible preferred stock. The Series B convertible
preferred stock has a stated par value of $.001 per share and 1,821,000 shares
were issued at $1.00 per share, convertible into 1,821,000 shares of the
Company's common stock at the rate of $1.00 per share. An additional 50,000
shares were issued (valued at $50,000) for professional services provided to the
Company. There was a placement cost of $85,000 related to the issuance of
Series B and the amount was paid in full during 1999. As of March 31, 2000,
1,366,000 shares of Series B convertible preferred stock have been converted
into 1,366,000 shares of common stock.

In April 1999, the board of directors authorized the issuance of 500,000 shares
of Series D convertible preferred stock. The Series D convertible preferred
stock has a stated par value of $.001 per share and was initially convertible
into 1,190,500 shares of the Company's common stock at the rate of $4.20 per
share. As of December 31, 1999, the Company had sold an aggregate of 466,000
shares of Series D convertible preferred stock for $4,660,000 prior to the
payment of $459,750 of preferred stock placement costs. This $459,750 placement
costs has been recorded in the additional paid in capital account. In addition,
the Company issued an aggregate of 700,000 common stock purchase warrants in
connection with the sale of Series D convertible preferred stock. Each warrant,
as adjusted, is exercisable at $6.30 per share of common stock for a two-year
period for an aggregate of 70,000 shares. On July 15, 1999, the Company sold
34,000 shares of Series D convertible preferred stock for $340,000 to Diego
Leiva, chairman of the board. The purchase is evidenced by a recourse promissory
note secured by a pledge of the securities. In January 2000, the conversion rate
was adjusted so that the preferred stock converts into common stock at $2.00 per
share. As of March 31, 2000, $3,095,000 of the principal amount of Series D
convertible preferred stock had been converted into 920,238 shares of common
stock.

At the time of issuance, the Series B and Series D were convertible at prices
below the market value of the underlying common stock The beneficial conversion
feature represented by the intrinsic value is calculated as the difference
between the conversion price and the market price of the underlying common stock
multiplied by the number of shares to be issued from the conversion. The
beneficial conversion feature is recognized as a return to the preferred
stockholders. At December 31, 1999, the beneficial conversion feature amounted
to $6,361,000 and $18,809,000 for the Series B and Series D, respectively.



                                      -11-
<PAGE>

                                      PICK COMMUNICATIONS CORP. AND SUBSIDIARIES

                                      NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

                                                                     (UNAUDITED)
--------------------------------------------------------------------------------


7. DISCONTINUED OPERATIONS:

On June 23, 1999, the Company formalized its plan to discontinue its
telecommunications and prepaid calling card business consisting of PICK US, PICK
Net and PICK Net UK PLC (collectively "PICK Net"). Accordingly, the
telecommunications and prepaid calling card business are accounted for as
discontinued operations in the accompanying consolidated financial statements.
The Company contracted to sell PICK Net and PICK Net UK PLC on September 13,
1999 and discontinued the operations of PICK US. On January 18, 2000, PICK
completed the sale of all of the stock of PICK Net for nominal value, and had
approximately $10,700,000 of PICK Net's liabilities assumed. The buyer provided
advances to PICK Net during 1999 to continue its operations. The Company issued
100,000 shares of common stock (valued at $1,000,000) of the old debt for
repayment. Subsequent to the closing of the sale of PICK Net, the buyer
defaulted on its payment obligation. The Company has demanded compliance by the
buyer or it will pursue all legal remedies against the buyer.

Operating results of discontinued telecommunications and prepaid calling card
business are as follows:

Three-month period ended March 31,                2000                  1999
--------------------------------------------------------------------------------
                                              (Unaudited)           (Unaudited)
Sales of long-distance services              $    168,598          $   1,212,997
Sales of prepaid calling cards                       --                2,782,571

--------------------------------------------------------------------------------
Net sales                                         168,598              3,995,568
--------------------------------------------------------------------------------

Cost of sales                                     328,864              5,139,515
Selling, general and administrative                62,101                419,386
Depreciation and amortization                      18,587                 94,197
Bad debt expense                                     --                   35,528

--------------------------------------------------------------------------------
Total costs and expenses                          409,552              5,688,626
--------------------------------------------------------------------------------

Loss before amortization of debt placement
 expenses and interest expense                    240,954              1,693,058

Interest expense                                  123,957                151,981

--------------------------------------------------------------------------------
Loss from discontinued operations            $    364,911            $ 1,845,039
================================================================================

                                                                     (continued)

<PAGE>

Assets and liabilities of discontinued telecommunications and prepaid calling
card business are as follows:

                                                       March 31,    December 31,
                                                         2000          1999
--------------------------------------------------------------------------------
                                                      (Unaudited)
Cash                                                  $    16,978   $   18,117

Accounts Receivable, less allowance for
 doubtful accounts of $231,448 and
 $482,735, respectively                                    47,119      228,885

Prepaid Expenses and Other Current Assets                  55,829       78,218

--------------------------------------------------------------------------------
Current Assets from Discontinued Operations               119,926      325,220
--------------------------------------------------------------------------------

Property and Equipment - at cost, net of
 accumulated depreciation and amortization
 of $784,786 and $771,301, respectively                 2,074,433    2,032,044

Security Deposits                                          57,425       36,350

--------------------------------------------------------------------------------
Long-term Assets from Discontinued Operations           2,131,858    2,068,394
--------------------------------------------------------------------------------



                                      -12-
<PAGE>

                                      PICK COMMUNICATIONS CORP. AND SUBSIDIARIES

                                      NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

                                                                     (UNAUDITED)
--------------------------------------------------------------------------------

                                                       March 31,    December 31,
                                                         2000          1999
--------------------------------------------------------------------------------
                                                      (Unaudited)
Current Liabilities:
  Current portion of debt (a)(b)(c)                  $  4,721,987   $  3,814,244
  Current portion of other debt                         1,018,578        306,130
  Accounts payable and accrued expenses                 6,120,800      6,815,620
  Deferred revenue - prepaid calling cards                 29,620         29,620

--------------------------------------------------------------------------------
Current Liabilities from Discontinued
 Operations                                            11,890,985     10,965,614
--------------------------------------------------------------------------------

Long-term Liabilities from Discontinued
 Operations - less current portion                          --           736,586

--------------------------------------------------------------------------------
        Net Liabilities of Discontinued
         Operations                                   $ 9,639,201   $  9,308,586
================================================================================

(a) In February 1998, the Company amended its existing telecommunications
    agreement with IDT Corporation ("IDT"), one of its long distance
    vendors/customers. Under the terms of the amendment, the Company agreed to
    sell IDT up to 10,000,000 minutes per month of long distance traffic,
    through June 9, 1999, at favorable rates and IDT agreed to lend the Company
    $2,000,000. Of this amount, $500,000 was funded when the transaction was
    signed, $1,000,000 was funded in April 1998 and the remaining $500,000 was
    advanced in June 1998. Concurrently, the Company issued 100,000 warrants
    with an exercise price of $2.40 per share to purchase 10,000 shares of
    common stock, 200,000 warrants with an exercise price of $10.00 per share to
    purchase 20,000 shares of common stock and 100,000 warrants with an exercise
    price of $5.60 per share to purchase 10,000 shares of common stock. The
    warrants are exercisable for a period of one year from the respective dates
    of grant. Management estimates the value of these warrants reflected in
    interest expense in 1998 at $30,879. The loan bears interest at 9% per annum
    and matured on February 9, 1999. In April 1999, the Company renegotiated its
    loan into a new six-month promissory note (the "Note"), in the amount of
    $2,000,000 plus $60,000 accrued interest at 12% per annum.

    Pursuant to an agreement, dated November 12, 1999, the Company extended the
    Note for an additional six months in the principal amount of $2,000,000 plus
    accrued interest. The Company has agreed to issue to IDT 40,000 shares of
    PICK's common stock in exchange for IDT's warrants to purchase 40,000 shares
    of PICK's common stock, which shall be canceled upon such delivery, plus a
    restructuring fee of 50,000 shares of PICK common stock. The Company also
    agreed to pay $250,000 upon the earlier to occur of 30 days from the date of



                                      -13-
<PAGE>

                                      PICK COMMUNICATIONS CORP. AND SUBSIDIARIES

                                      NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

                                                                     (UNAUDITED)
--------------------------------------------------------------------------------

    execution of the agreement or the completion of additional financing for at
    least $5,000,000 for PICK and shall make 6 monthly principal payments of
    $25,000 each on the last business day of each month following the issue date
    of this Note, beginning on November 15, 1999. In the event PICK elects to
    exercise its option to extend the maturity date of the Note from 6 months to
    3 years, it shall deliver to IDT $375,000, payable in immediately available
    funds or, at the option of PICK, 37,500 shares of PICK's common stock.

    Thereafter, PICK agrees to pay IDT $25,000 per month for 12 months,
    including the 6 monthly payments described above beginning on November 15,
    1999. Interest is payable monthly at 9% per annum. This Note will
    automatically convert into common stock at $10.00 per share if the average
    price of the Company's common stock exceeds $15.00 per share for at least 20
    consecutive days during which time the daily trading volume is at least
    20,000 shares. All shares of common stock issued or issuable to IDT were
    included in a registration statement declared effective on November 12,
    1999. PICK has been unable to make any required cash payments to IDT under
    the Note.

(b) As of March 31, 2000, PICK Net has received from an affiliate of the buyer
    of PICK Net approximately $283,000.

(c) PICK Net has promissory notes with ATN in the aggregate amount of $2,119,424
    at March 31, 2000, which bear interest at prime plus 2% (11% at March 31,
    2000). These promissory notes were entered into in connection with the sales
    of PICK Net as described in the stock purchase agreement dated September 13,
    1999. The promissory notes became due and payable on February 4, 2000 and
    have not been paid (see Note 4).


8. LITIGATION SETTLEMENTS AND RESERVE FOR CONTINGENT LIABILITY:

The Company is involved in various claims and legal actions arising from the
ordinary course of business. Management is of the opinion that ultimate outcome
of these matters would not have a material adverse impact on the financial
position of the Company or the results of its operations, except as described
below.

In February 1997, the Company commenced a mediation action against American
Telephone & Telegraph ("AT&T") seeking $10,000,000 in damages for breach of
contract and fraudulent inducement and malicious conduct under a carrier
agreement (the "Carrier Agreement") entered into in February 1996. The Company
contracted with AT&T under the Carrier Agreement for inbound 800 service and
outbound domestic and international long distance service. The Company claimed
that AT&T reneged on certain commitments to provide the Company with lower
international rates than the Company was invoiced by AT&T. AT&T claimed that the
Company owed it in excess of $1,000,000. In 1996, the Company provided for a
noncash reserve of $1,750,000, which was reduced to $1,100,000 in the third
quarter of 1997 and is a part of the Company's working capital deficiency. The
reserve is included in accounts payable and accrued expenses in the accompanying
consolidated financial statements.

After two mediation sessions, AT&T indicated that it intended to withdraw from
the mediation. Accordingly, on November 5, 1997, the Company filed for
arbitration proceedings against AT&T and reduced its claim to $5,000,000. In
October 1999, the arbitrator found that AT&T was entitled to a net award of
$1,376,447 plus 9% interest per annum since January 31, 1997. The buyer of PICK
Net has assumed $95,000 of this settlement as defined in the purchase agreement
(see Note 7). However, the Company remains liable for the balance of the



                                      -14-
<PAGE>

                                      PICK COMMUNICATIONS CORP. AND SUBSIDIARIES

                                      NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

                                                                     (UNAUDITED)
--------------------------------------------------------------------------------

judgment and is without the funds to satisfy it. Unless it is able to negotiate
payment over an extended period of time this amount could force the Company into
curtailing its operations or seeking protection under the bankruptcy laws. AT&T
has converted the arbitration award into a judgment which it is attempting to
enforce.

During March 1999, Worldcom Network Services, Inc., d/b/a Wiltel, ("Worldcom")
commenced a lawsuit against the Company in the United States District Court,
Southern District of New York, demanding a judgment in the amount of $1,177,734
and interest at 18% per annum plus costs and expenses. The plaintiff alleges
that the Company failed to pay for telecommunications services provided. On
April 15, 1999, the Company and Worldcom agreed to a settlement (the "Settlement
Agreement"). Under the terms of the Settlement Agreement, the Company agreed to
pay Worldcom $1,256,622 (the "Settlement Payment") in exchange for a full and
complete settlement of Worldcom's lawsuit against the Company. The Company
agreed to pay the Settlement Payment with interest at 16% per annum on or before
January 16, 2000 and for Worldcom to discontinue, without prejudice, the legal
proceedings until such date, although the Company has the option to extend the
forbearance through January 16, 2001. The Company paid Worldcom a 100,000 share
restructuring fee during 1999.

In July 1999, L.D. Exchange.com, Inc., a vendor of PICK Net, Inc., commenced
arbitration proceedings against PICK Net before the American Arbitration
Association in San Diego, California, alleging breach of contract. These
proceedings involve the alleged nonpayment of between $250,000 and $500,000. At
March 31, 2000, the Company's current liabilities included approximately
$266,000 payable to L.D. Exchange.com, Inc.


9. GOING CONCERN MATTERS:

The accompanying consolidated financial statements have been prepared assuming
that the Company will continue as a going concern, which contemplates the
realization of assets and the satisfaction of liabilities in the normal course
of business. The Company has incurred substantial recurring losses from
operations, has a net capital deficiency in the amount of approximately
$25,414,000 and has a working capital deficiency of approximately $22,295,837 at
March 31, 2000 that raise substantial doubt about its ability to continue as a
going concern. In addition, the Company had negative cash flow from operations
for the three-month periods ended March 31, 2000 and 1999, for the years ended
December 31, 1999, 1998 and 1997.

Significant short-term obligations exist including the payments of the
settlements with Worldcom and AT&T in the amounts of $1,256,622 and $1,376,447,
respectively (see Note 8) plus accrued interest. Additionally, payment of loans
to various creditors plus accrued interest at March 31, 2000 cannot be met
through cash flows from operations. Without the Company's ability to extend the
payout terms of the aforementioned liabilities or obtain additional long-term
financing, as well as increasing revenue and/or decreasing expenses, the Company
will be unable to continue as a going concern. The consolidated financial
statements do not include any adjustments relating to the recoverability of
assets or the classifications of liabilities should the Company be unable to
continue as a going concern.

<PAGE>

Furthermore, the Company is in need of immediate financing for working capital.
If the Company is able to obtain adequate funding it expects that its operations
on a going-forward basis will be primarily through its PICK Sat subsidiary,
which has only recently commenced operations and has not generated any revenue
to date.

Should the Company be unable to obtain interim financing in the near term the
Company will be forced to cut back or suspend operations and/or seek protection
under the bankruptcy laws. Although the Company is in discussions with several
sources of financing, there can be no assurance the Company will obtain such
financing.


10. SUBSEQUENT EVENTS:

In April 2000, a group of investors from Europe and the Middle East committed an
aggregate of $10,000,000 to PICK Sat (the "PICK Sat Financing"), to occur over a
12-month period. The investors will acquire 20% ownership of PICK Sat and will
be issued equity on the basis of 1% for every $500,000 invested. As of June 5,
2000, $1,000,000 has been invested in PICK Sat. The initial $500,000 was made as
a convertible loan on a pari passu basis with the ATN indebtedness described in
Note 4.

                                      -15-

<PAGE>

Item 2: Management's Discussion and Analysis of Financial Condition and Results
of Operations

        The following should be read in conjunction with the Consolidated
Financial Statements included elsewhere in this Report.

Material Changes in Results of Operations

On June 23, 1999, the Company's Board of Directors voted to sell or discontinue
the telecommunications portion of its business in order to focus on the Internet
services portion of its business conducted through its PICKSat, Inc. ("PICK
Sat") and PICK Online.Com, Inc. ("PICK Online") subsidiaries. Accordingly, the
financial statements reflect the discontinuance of the Company's PICK US, Inc.
("PICK US"), PICK Net Inc. ("PICK Net") and PICK Net UK PLC subsidiaries. The
closing of the sale of the PICK Net subsidiaries occurred on January 18, 2000.
See "Costs and Expenses" below.

In 1999, the Company, through its wholly owned subsidiary, PICK Sat commenced
development of a system to multicast the delivery of Internet Protocol
multi-media content via satellite. Also in March 1999, the Company formed PICK
Online to provide broadband Internet content to users. PICK Sat and PICK Online
are in the development stage and have not generated any revenues to date.

For PICK Sat business, the Company will charge its customers monthly recurring
fees based on type of usage and bandwidth contracted for and may charge an
additional amount per reception location. PICK Online expects to charge a per
subscriber or per site fee to its customers in order for them to receive the
broadband content.

The discontinued subsidiaries generated revenues from the sale of
telecommunication services. These included international long distance service
to carriers and resellers, and revenues derived from prepaid telephone calling
cards to distributors for resale to retail outlets.

The Company's costs of sales for the discontinued operations primarily consist
of the cost of telephone services, for both the resale of international long
distance services and for prepaid telephone calling cards.

For the resale of international long distance, the Company recognized revenues
as its customers used the traffic. For prepaid telephone calling cards sales,
the Company recognized revenues at the time it provided the telephone services
associated with its cards and recognized the cost of the carrier telephone
traffic based on the minutes used in the same periods that the Company
recognized revenues.


                                       16

<PAGE>

Three Months Ended March 31, 2000 Compared with March 31, 1999

Revenues:

The Company's continuing operation's, PICK Sat and PICK Online have recently
commenced commercial operations and as such have had no revenues for the three
months ended March 31, 2000.

Costs and Expenses:

Selling, general and administrative expenses decreased to $875,022 for the three
months ended March 31, 2000, from $977,208 for the three months ended March 31,
1999, reflecting a decrease of $102,186 or 10.5 %. This decrease is primarily
due to the fact that the PICKSat and PICK Online subsidiaries were in the
organizational phase through the three months ended March 31, 1999 and required
more significant start-up and development expenses. The Company also continues
to have significant expenses for salaries, outside consultants, accounting,
legal, travel and public relations. Contemporaneous with the Board's decision to
sell or discontinue its telecommunications operations, and layoff or fire the
associated personnel, it needed to retain outside professional services on an
interim basis to handle the functions previously performed by salaried
employees. The Company also had increased expenses for preparation of public
filings and the negotiation of debt arrangements which were handled primarily by
non-employees.

Loss from Operations:

The Company's loss from continuing operations decreased from $1,471,205 for the
three months ended March 31, 1999 to $1,200,460 for the three months ended March
31, 2000, primarily due to the decreases in aggregate salaries, selling, general
and administrative costs, as PICK Sat and PICK Online were still developing
their products and offerings and as PICK Sat began to move closer to the
commercial deployment phase and other expenses as discussed under "Costs and
Expenses" above. The Company was without adequate funds during the three months
ended March 31, 2000 to commercialize its PICK Sat operations, prior to the PICK
Sat Financing and therefore was operating at a reduced level. In addition, the
loss from continuing operations during the three months ended March 31, 2000 was
reduced by $293,977 due to a settlement of an old outstanding accounts payable
balance.

Discontinued Operations

On June 23, 1999, the Company formalized its plan to discontinue its
telecommunications and prepaid calling card business consisting of PICK US, PICK
Net and PICK Net UK PLC (collectively "PICK Net"). Accordingly, the
telecommunications and prepaid calling card


                                       17

<PAGE>

business are accounted for as a discontinued the operation in the accompanying
consolidated financial statements. On September 13, 1999, the Company agreed to
sell its PICK Net operations to Lebow Investments Ltd., a recently formed
corporation ("Lebow"). Lebow agreed to be financially responsible for the PICK
Net operations which received funding to continue operations commencing in
September 1999 through the closing of this transaction. On January 18, 2000, the
Company completed the sale of all of the stock of PICK Net for nominal value,
and had up to approximately $10 million of PICK Net's liabilities assumed.
Simultaneously with the closing, Gulfsat Communications Company, a Kuwaiti
company ("Gulfsat"), purchased all of the common stock of Lebow. Gulfsat was a
principal vendor of services to the PICK Net companies which was owed
approximately $1,555,000 as of October 31, 1999, primarily under a reciprocal
telecommunications agreement and payment of which amount had been assumed by
Lebow. In February 2000, Gulfsat defaulted under its agreements and discontinued
operating PICK Net. The Company has made demand on Lebow and Gulfsat to satisfy
its obligations, or it will pursue all legal remedies, but is attempting to
negotiate a settlement. In any event, however, in addition to the direct
obligations of the Company described hereinafter, the Company retains
substantial contingent liabilities on its discontinued operations if those
liabilities are not paid. (See Note 7 of Notes to Consolidated Financial
Statements for operating results of the discontinued operations).

Loss from discontinued operations decreased from $1,845,039 for the three months
ended March 31, 1999 to $364,911 for the three months ended March 31, 2000. The
Company only operated its subsidiaries for 18 days during the three months ended
March 31, 2000 before selling the operations, [although it had certain ongoing
obligations in view of its contingent liabilities which necessitated certain
payments].

For the three months ended March 31, 2000, the Company generated international
long distance revenue of $168,598, compared with $1,212,997 for the three months
ended March 31, 1999. The Company had no prepaid telephone calling card revenues
for the three months ended March 31, 2000, compared to $2,782,571 for the three
months ended March 31, 1999. The cost of sales decreased from $5,139,515 to
$328,864, as operations were wound down.

Material Changes in Financial Condition from December 31, 1999 to March 31,
2000:

Due to the losses discussed above, the Company's working capital deficit
increased from $19,912,739 as of December 31, 1999, to $22,295,837 as of March
31, 2000 (an increase in the working capital deficit of $2,383,098) and the
stockholders' deficiency increased from $23,848,441 at December 31, 1999 to
$25,413,812 at March 31, 2000, an increase in stockholders' deficiency
of $1,565,371.

Current assets decreased by $232,466 primarily due to a decrease in current
assets from discontinued operations at March 31, 2000. Current liabilities
increased by $2,150,632. This increase is largely due to increases in the
current portion of debt, in accounts payable and accrued


                                       18

<PAGE>

expenses and current liabilities from discontinued operations. However, a
substantial portion of current liabilities from discontinued operations were
assumed by Lebow and Gulfsat on January 18, 2000.

Approximately $1,623,000 of the liabilities of the Company mature or are
subject to payment agreements calling for payment before the end of 2000.
Management is in the process of negotiating with the largest trade creditors to
restructure a substantial portion of this short-term debt, but there can be no
assurance that agreements will be executed.

The Company is in need of immediate financing for working capital. In April
2000, a group of investors from Europe and the Middle East committed an
aggregate of $10 million to PICK Sat (the "PICK Sat Financing"), to occur over a
12-month period. The investors will acquire 20% ownership of PICK Sat and will
be issued equity on the basis of 1% for every $500,000 invested. As of
August 28, 2000, $4 million has been invested in PICKSat. The initial $500,000
was made as a convertible loan on a pari passu basis with the Atlantic
Tele-Network Inc. ("ATN") indebtedness described below.

In September, 1999 PICK entered into an option agreement with Atlantic
Tele-Network, Inc. ("ATN") to sell them up to 19.9% of the common stock of PICK
Sat for $8 million, with an option to acquire an additional 31.1% for an
additional $15 million payable in 500,000 shares of ATN common stock or $15
million in cash or ATN common stock, whichever produces the higher value at the
time of exercise of the option was exercised in full. PICK Sat obtained interim
loans in the principal amount of $476,000 from ATN for the Company and PICK
Sat's operating expenses. ATN chose not to exercise the option. In addition,
under a credit facility, one of PICK's former subsidiaries, PICK Net USA, has
debt, amounting to $2,119,424 as of March 31, 2000. In accordance with the terms
of the above loans from ATN, the $476,000 borrowed by PICK Sat and the
$2,119,424 borrowed by PICK Net USA, all become due and payable on February 4,
2000 and has not been paid. On January 4, 2000, in consideration with the
completion of the sale of the Company's PICK Net subsidiaries to Lebow and
Gulfsat, as well as the termination of the PICK Sat option, ATN received
five-year warrants to purchase 1 million shares of PICK Common Stock exercisable
at $2.00 per share.

On November 3, 1999, PICK Sat obtained a 120 day revolver for $500,000 (the
"Revolver") from Tri-Links Investment Trust ("Tri-Links"). PICK Sat borrowed the
entire $500,000 under the Revolver which bears interest at 13% per annum,
increasing to l5% per annum upon default and payment of which is guaranteed by
PICK. Tri-Links was granted a security interest in substantially all of PICK
Sat's assets which was initially subordinated to ATN and then made pari passu
and equal in priority. The Revolver came due on March 3, 2000 and was extended
until May 3, 2000. On January 26, 2000, Tri-Links, PICK and PICK Sat entered
into an Amendment Agreement which was amended again in March and April 2000,
whereby the commitment under the Revolver was eventually increased to
$l,400,000, all of which has been loaned to PICK Sat, as of the date hereof. The
loan payable balance at March 31, 2000, amounted to $1,147,458. Tri-Links has
entered into Participation Agreements with Group Technology for Scientific
Equipment and Supplies ("Group Technology") and Salah Khalid Al Fulaij for the
unfunded


                                        19

<PAGE>

portion of the commitment. In connection with the Revolver, PICK agreed to use
its best efforts to cause four designees of Tri-Links to be elected to the PICK
Board of Directors. Tri-Links was issued warrants to purchase 2.5% to the issued
and outstanding common stock of PICK Sat on a fully diluted basis. Group
Technology was assigned Tri-Links's right to elect two of the four Directors and
its assignee was given warrants to purchase 2.5% of the issued and outstanding
common stock of PICK Sat on a fully diluted basis.

On March 3, 2000, upon PICK Sat's inability to repay the Revolver, PICK Sat
entered into an Extension Agreement extending payment of the Revolver until
March l7, 2000. In consideration of the extension and Tri-Links efforts to
obtain additional funding for PICK Sat, Tri-Links and Group Technology were each
granted warrants to purchase an additional one percent (1%) of the issued and
outstanding common stock of PICK Sat. The loan is past due and the parties are
currently negotiating the restructuring of terms of the Revolver, as well as
negotiating the terms of indebtedness to ATN. The Company and Tri-Links have
reached an agreement in principle whereby a portion of the Revolver will be
converted into equity and the balance will be repaid over a period of time.

In March 1999, the board of directors authorized the issuance of 2,000,000
shares of Series B convertible preferred stock. The Series B convertible
preferred stock has a stated par value of $.001 per share and 1,871,000 shares
were issued, convertible into 1,871,000 shares of the Company's common stock at
the rate of $1.00 per share. As of March 31, 2000, 1,366,000 shares of Series B
convertible preferred stock had been converted into common stock.

In April 1999, the board of directors authorized the issuance of 500,000 shares
of Series D convertible preferred stock. The Series D convertible preferred
stock has a stated par value of $.001 per share and was initially convertible
into 1,190,500 shares of the Company's common stock at the rate of $4.20 per
share. As of December 31, 1999, the Company had sold an aggregate of 466,000
shares of Series D convertible preferred stock for $4,660,000 prior to the
payment of $459,750 of preferred stock placement costs. In addition, the Company
issued an aggregate of 700,000 common stock purchase warrants in connection with
the sale of Series D convertible preferred stock. Each Warrant is exercisable at
$6.30 per share of common stock for a two-year period. On July 15, 1999, the
Company sold 34,000 shares of Series D convertible preferred stock for $340,000
to Diego Leiva, chairman of the board. The purchase is evidenced


                                       20

<PAGE>

by a recourse promissory note secured by a pledge of the securities. Mr. Leiva
has agreed to return the 34,000 shares of Series D Preferred Stock and
accompanying warrants to the Company for cancellation. In January 2000, the
conversion rate was adjusted so that the preferred stock converts into common
stock at $2.00 per share. As of March 31, 2000 $3,095,000 principal amount of
Series D Convertible Preferred Stock had been converted into common stock. Of
the remaining $1,905,000 principal amount of Series D Convertible Preferred
Stock, an additional $40,000 principal amount was converted into 20,000 shares
of Common Stock through August 14, 2000.

At December 31, 1999, we also recorded a beneficial dividend of $25,170,000
associated with the issuance of preferred stock. This charge did not use any
cash of the Company.

Material Changes in Cash Flows

Cash decreased during the three months ended March 31, 2000, by $22,265. This
decline is attributable to an increase in net cash used in operating activities
of $674,380 and investing activities of $83,343. This is offset by increases in
cash provided by financing activities of $757,723.

Cash Flows from Operating Activities

Operating activities used $674,380 in cash for the three months ended March 31,
2000, compared with a use of $692,148 for the three months ended March 31, 1999.
Cash flows from operating activities consists primarily of a net loss of
$1,565,371 for the three months ended March 31, 2000, compared with a net loss
of $3,316,244 for the three months ended March 31, 1999. Net cash also reflected
a $736,586 decrease in long-term liabilities for discontinued operations and a
$925,371 increase in current liabilities from discontinued operations, whereas
there were no discontinued operations during the three months ended March 31,
1999.

Cash Flows from Investing Activities

The Company's capital expenditures of $83,343 for the three months ended March
31, 2000 decreased from the three months ended March 31, 1999 of $414,002. This
decrease is attributable primarily to the Company's development of the
satellite-based Internet access, interactive multimedia structures for its PICK
Sat subsidiary in 1999.

Cash Flows from Financing Activities

During the three months ended March 31, 2000, the Company had net cash provided
by financing of approximately $757,723, as compared to $900,092 in the three
months ended March 31, 1999. During the three months ended March 31, 1999, the
Company received $965,000 of proceeds from the issuance of Series B Preferred
Stock. During the three months ended March 31, 2000 the Company received
$735,458 from funds borrowed from Tri-Links, as described above.


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<PAGE>

Year 2000 Compliance

There have been no material changes since the Company's disclosure in its Annual
Report on Form 10-K for December 31, 1999. The Company identified and prepared
for all significant internal Y2K issues that could adversely affect its business
operations. The cost of resolving such issues did not have a material impact on
the Company's financial position, results of operations or liquidity.


                                       22
<PAGE>

Part II  Other Information

Item 1 - Legal Proceedings:

During the quarter ended March 31, 2000, there were no material changes in the
Company's previously reported legal proceeding in its Annual Report on Form 10-K
for December 31, 1999.

Item 2 - Changes in Securities:

There have been no material changes since the Company's disclosure in the Annual
Report on Form 10-K from December 31, 1999.

Item 6. Exhibits and Reports on Form 8-K

            (a) Exhibits

                 27.1 Selected Financial Data.

            (b) Reports on Form 8-K.

                   None.


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<PAGE>

                                   SIGNATURES


        Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned, thereunto duly authorized.


                                                  PICK COMMUNICATIONS CORP.


Dated: September 1, 2000                          By: /s/ Helge Bornmann
                                                  -------------------
                                                  Helge Bornmann,
                                                  Chairman of the Board
                                                  and Chief Executive
                                                  Officer (Principal
                                                  Executive Officer and
                                                  Principal Financial Officer)


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