---

---

U.S. Securities & Exchange CommissionWashington, D.C. 20549

---

FORM 10-QSB

(Mark One)

|/x/ | QUARTERLY REPORT PURSUANT TO SECTION 13 or 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|--- | ---------------------------------------------------------------------------------------

For the quarterly period ended September 30, 2001

|/ / | TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|--- | ----------------------------------------------------------------------------------

Commission file number 0-25764

---

OneLink, Inc.(Exact name of small business issuer as specified in its charter)

Minnesota(State or other jurisdiction
of incorporation or organization)

41-1675041(IRS Employer Identification No.)10340 Viking Drive, Suite 150
Eden Prairie, MN 55344(Address of principal executive offices)952-996-9000(Issuer's telephone number)


---

Check
whether the issuer (1) filed all reports required to be filed by section 13 or 15(d) of the Exchange Act during the past 12 months (or for such 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 /x/  No / /

APPLICABLE
TO CORPORATE ISSUERS

State
the number of shares outstanding of each of the issuer's classes of common equity, as of the latest practicable date: 9,861,254 shares of common stock outstanding as of
November 9, 2001, par value $.01 per share.

Transitional
Small Business Disclosure Format (check one); Yes / /  No /x/

---

---

---



OneLink, Inc.
Form 10-QSB
Quarter Ended September 30, 2001

Table of Contents

|              |         |                                                                                          |                                                                                             | Page No.
|------------- | ------- | ---------------------------------------------------------------------------------------- | ------------------------------------------------------------------------------------------- | --------
|PART I        |         | Financial Information                                                                    |                                                                                             | 3       
|              | Item 1. |                                                                                          | Financial Statements (Unaudited)
Balance Sheets at September 30, 2001 and December 31, 2000 |         
|              |         | Statements of Operations for the three and nine months ended September 30, 2001 and 2000 |                                                                                             | 4       
|              |         | Statements of Cash Flows for the nine months ended September 30, 2001 and 2000           |                                                                                             | 5       
|              |         | Notes to Financial Statements                                                            |                                                                                             | 6       
|              | Item 2. |                                                                                          | Management's Discussion and Analysis or Plan of Operations                                  |         
|PART II       |         | Other Information                                                                        |                                                                                             | 14      
|              | Item 1. |                                                                                          | Legal Proceedings                                                                           |         
|              | Item 6. |                                                                                          | Exhibits and Reports on Form 8-K                                                            |         
|SIGNATURES    |         | 15                                                                                      
|Exhibit Index |         | 16                                                                                      

2

---



PART IFinancial Information

Item 1. Financial Statements

OneLink, Inc.  Balance Sheets

|                                           |                                                                                                                                                             | September 30,
2001
(unaudited) |           | December 31,
2000 |  
|------------------------------------------ | ----------------------------------------------------------------------------------------------------------------------------------------------------------- | ------------------------------ | --------- | ----------------- | -
|Assets                                     |                                                                                                                                                             |                                |           |                   |  
|Current assets:                            |                                                                                                                                                             |                                |           |                   |  
|                                           | Cash and cash equivalents                                                                                                                                   |                                | $         | 331,127           |  
|                                           | Trade accounts receivable, net of allowance for doubtful accounts of $0 in 2001 and 2000                                                                    |                                |           | 107,724           |  
|                                           | Prepaid expenses                                                                                                                                            |                                |           | 77,900            |  
|                                           |                                                                                                                                                             |                                |           |                   |  
|Total current assets                       |                                                                                                                                                             |                                | 516,751   |                   |  
|                                           |                                                                                                                                                             |                                |           |                   |  
|Property and equipment:                    |                                                                                                                                                             |                                |           |                   |  
|                                           | Furniture and equipment                                                                                                                                     |                                |           | 600,643           |  
|                                           | TeleSmart equipment                                                                                                                                         |                                |           | 1,057,935         |  
|                                           | Product equipment                                                                                                                                           |                                |           | 214,505           |  
|                                           | Web based software                                                                                                                                          |                                |           | 745,940           |  
|                                           |                                                                                                                                                             |                                |           |                   |  
|                                           | Total property and equipment                                                                                                                                |                                |           | 2,619,023         |  
|                                           | Accumulated depreciation and amortization                                                                                                                   |                                |           | (2,096,602        | )
|                                           |                                                                                                                                                             |                                |           |                   |  
|                                           |                                                                                                                                                             |                                | 522,421   |                   |  
|                                           |                                                                                                                                                             |                                |           |                   |  
|Other assets:                              |                                                                                                                                                             |                                |           |                   |  
|                                           | Long-term prepaid expense, net of amortization                                                                                                              |                                |           | 559,551           |  
|                                           | Deposits                                                                                                                                                    |                                |           | 11,465            |  
|                                           |                                                                                                                                                             |                                |           |                   |  
|                                           |                                                                                                                                                             |                                | 571,016   |                   |  
|                                           |                                                                                                                                                             |                                |           |                   |  
|Total assets                               |                                                                                                                                                             | $                              | 1,610,188 |                   | $
|                                           |                                                                                                                                                             |                                |           |                   |  
|Liabilities and Shareholders' Equity       |                                                                                                                                                             |                                |           |                   |  
|Current liabilities:                       |                                                                                                                                                             |                                |           |                   |  
|                                           | Accounts payable                                                                                                                                            |                                | $         | 33,521            |  
|                                           | Accrued payroll and related taxes                                                                                                                           |                                |           | 146,486           |  
|                                           | Accrued expenses                                                                                                                                            |                                |           | 161,833           |  
|                                           | Deferred revenue                                                                                                                                            |                                |           | 149,701           |  
|                                           |                                                                                                                                                             |                                |           |                   |  
|Total current liabilities                  |                                                                                                                                                             |                                | 491,541   |                   |  
|                                           |                                                                                                                                                             |                                |           |                   |  
|Shareholders' equity:                      |                                                                                                                                                             |                                |           |                   |  
|                                           | Series A Preferred stock, par value $.01 per share, Authorized shares1,400,000; Issued and outstanding shares: 2001 and 20001,320,000 and 0, respectively |                                |           | 13,200            |  
|                                           | Common stock, par value $.01 per share, Authorized shares50,000,000; Issued and outstanding shares: 2001 and 20009,861,254                                |                                |           | 98,612            |  
|                                           | Additional paid-in capital                                                                                                                                  |                                |           | 16,116,976        |  
|                                           | Stock subscription receivable                                                                                                                               |                                |           | (223,922          | )
|                                           | Accumulated deficit                                                                                                                                         |                                |           | (14,886,219       | )
|                                           |                                                                                                                                                             |                                |           |                   |  
|Total shareholders' equity                 |                                                                                                                                                             |                                | 1,118,647 |                   |  
|                                           |                                                                                                                                                             |                                |           |                   |  
|Total liabilities and shareholders' equity |                                                                                                                                                             | $                              | 1,610,188 |                   | $
|                                           |                                                                                                                                                             |                                |           |                   |  

See accompanying notes.

3

---



OneLink, Inc.  Statements of Operations  (unaudited)

|                                                                  |                                  | Three months ended September 30, |           | Nine months ended September 30, |  
|----------------------------------------------------------------- | -------------------------------- | -------------------------------- | --------- | ------------------------------- | -
|
|Revenues:                                                         |                                  |                                  |           |                                 |  
|                                                                  | TeleSmart                        |                                  |           | 243,747                         |  
|                                                                  | Consulting                       |                                  |           | 73,750                          |  
|                                                                  | Product/Set-up fees              |                                  |           | 9,655                           |  
|                                                                  | Customer Service                 |                                  |           | 35,149                          |  
|                                                                  |                                  |                                  |           |                                 |  
|Total Revenues                                                    |                                  |                                  | 362,301   |                                 |  
|Cost of revenues:                                                 |                                  |                                  |           |                                 |  
|                                                                  | TeleSmart                        |                                  |           | 106,941                         |  
|                                                                  | Consulting                       |                                  |           | 51,792                          |  
|                                                                  | Product/Set-up fees              |                                  |           | 60,274                          |  
|                                                                  | Customer Service                 |                                  |           | 33,957                          |  
|                                                                  |                                  |                                  |           |                                 |  
|Total cost of revenues                                            |                                  |                                  | 252,964   |                                 |  
|                                                                  |                                  |                                  |           |                                 |  
|Gross profit                                                      |                                  |                                  | 109,337   |                                 |  
|                                                                  |                                  |                                  |           |                                 |  
|Operating expenses:                                               |                                  |                                  |           |                                 |  
|                                                                  | Selling                          |                                  |           | 29,684                          |  
|                                                                  | General and administrative       |                                  |           | 391,881                         |  
|                                                                  | Research and product development |                                  |           | 31,826                          |  
|                                                                  | Restructuring fees               |                                  |           | 29,906                          |  
|                                                                  |                                  |                                  |           |                                 |  
|Total operating expenses                                          |                                  |                                  | 483,297   |                                 |  
|                                                                  |                                  |                                  |           |                                 |  
|Operating loss                                                    |                                  |                                  | (373,960  | )                               |  
|Interest income                                                   |                                  |                                  | 3,725     |                                 |  
|Other income                                                      |                                  |                                  | 0         |                                 |  
|                                                                  |                                  |                                  |           |                                 |  
|Net loss                                                          |                                  | $                                | (370,235  | )                               | $
|                                                                  |                                  |                                  |           |                                 |  
|Net loss per common share:                                        |                                  |                                  |           |                                 |  
|                                                                  | Basic and Diluted                |                                  | $         | (0.04                           | )
|                                                                  |                                  |                                  |           |                                 |  
|Weighted average number of shares outstanding (Basic and Diluted) |                                  |                                  | 9,861,254 |                                 |  
|                                                                  |                                  |                                  |           |                                 |  

See accompanying notes.

4

---



OneLink, Inc.  Statements of Cash Flows  (unaudited)

|                                                                            |                                              | Nine months ended September 30,                               |           
|--------------------------------------------------------------------------- | -------------------------------------------- | ------------------------------------------------------------- | ----------
|
|Operating activities:                                                       |                                              |                                                               |           
|Net loss                                                                    |                                              | $                                                             | (1,696,415
|Adjustments to reconcile net loss to net cash used in operating activities: |                                              |                                                               |           
|                                                                            | Depreciation and amortization                |                                                               |           
|                                                                            | Warrants issued for services                 |                                                               |           
|                                                                            | Net gain on sale of property and equipment   |                                                               |           
|                                                                            | Changes in operating assets and liabilities: |                                                               |           
|                                                                            | Accounts receivable, net                     |                                                               |           
|                                                                            | Computer parts and supplies, net             |                                                               |           
|                                                                            | Prepaid expenses and deposits                |                                                               |           
|                                                                            | Accounts payable and accrued expenses        |                                                               |           
|                                                                            | Deferred revenue                             |                                                               |           
|                                                                            |                                              |                                                               |           
|Net cash used in operating activities                                       |                                              |                                                               | (854,443  
|                                                                            |                                              |                                                               |           
|Investing activities:                                                       |                                              |                                                               |           
|Proceeds from sale of property and equipment                                |                                              |                                                               | 257       
|Purchases of property and equipment                                         |                                              |                                                               | (83,422   
|                                                                            |                                              |                                                               |           
|Net cash used in investing activities                                       |                                              |                                                               | (83,165   
|                                                                            |                                              |                                                               |           
|Financing activities:                                                       |                                              |                                                               |           
|Proceeds from issuance of stock options                                     |                                              |                                                               | 0         
|Payments on contingent notes payable                                        |                                              |                                                               | 0         
|Proceeds from payment on stock subscription receivable                      |                                              |                                                               | 0         
|Proceeds from warrants exercised                                            |                                              |                                                               | 0         
|Proceeds from issuance of Series A preferred stock, net                     |                                              |                                                               | 615,133   
|                                                                            |                                              |                                                               |           
|Net cash provided by financing activities                                   |                                              |                                                               | 615,133   
|                                                                            |                                              |                                                               |           
|Decrease in cash and cash equivalents                                       |                                              |                                                               | (322,475  
|Cash and cash equivalents at beginning of period                            |                                              |                                                               | 653,602   
|                                                                            |                                              |                                                               |           
|Cash and cash equivalents at end of period                                  |                                              | $                                                             | 331,127   
|                                                                            |                                              |                                                               |           
|Supplemental Disclosures of Cash Flow Information:                          |                                              |                                                               |           
|                                                                            | Cash paid during the period for interest     |                                                               | $         
|                                                                            | Cash paid during the period for taxes        |                                                               | $         
|                                                                            | Noncash financing activity:                  |                                                               |           
|                                                                            |                                              | Common stock issued in exchange for long-term prepaid expense |           

See accompanying notes.

5

---



OneLink, Inc.  Notes to Financial Statements  September 30, 2001  (unaudited)

Note 1. Summary of Significant Accounting Policies.

Interim Financial Information

The accompanying unaudited financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America
and pursuant to the rules and regulations of the U. S. Securities and Exchange Commission for interim financial information. Accordingly, certain information and footnote disclosures normally included
in financial statements prepared in accordance with generally accepted accounting principles have been omitted pursuant to such rules and regulations. Operating results for the nine months ended
September 30, 2001 are not necessarily indicative of the results that may be expected for the year ending December 31, 2001. The accompanying financial statements and related notes
should be read in conjunction with our audited financial statements, and notes thereto, for the fiscal year ended December 31, 2000, included in our Annual Report on
Form 10-KSB for the year ended December 31, 2000.

The
financial information furnished reflects, in the opinion of management, all adjustments, consisting of normal recurring accruals, necessary for a fair presentation of the results
of the interim periods presented.

Revenue Recognition

Revenue for services is recognized at the end of each month in which services are provided. Revenue for product sales is recorded upon shipment. Revenue on
certain contracts may require revenue recognition under contract accounting rules, whereby revenue is recognized on a percentage of
completion basis. Billings in excess of costs and estimated earnings are included in deferred revenue. The Company ensures that the transactions comply with the seven conditions and the six
considerations contained in Accounting and Auditing Enforcement Release No. 108 of the Securities and Exchange Commission (SEC). In November 1999, the SEC issued Staff Accounting
Bulletin (SAB) No. 101, "Revenue Recognition." SAB No. 101, as amended, sets forth the SEC staff's position regarding the point at which it is appropriate for a registrant to recognize
revenue. The staff believes that revenue is realizable and earned when all of the following criteria are met: persuasive evidence of an arrangement exists, delivery has occurred or service has been
rendered, the seller's price to the buyer is fixed or determinable and collectibility is reasonably assured. The Company uses the above criteria to determine whether revenue can be recognized, and
therefore, believes that the issuance of this bulletin did not have a material impact on these financial statements. The Company adopted SAB No. 101 during the year ended December 31,
2000 and the effect of adoption was not material to the financial statements.

6

---

Impact of Recently Issued Accounting Standards

Statement of Financial Accounting Standards (SFAS) No. 133, "Accounting for Derivative Instruments and Hedging Activities," as amended, is effective for
years beginning after June 15, 2000. SFAS No. 133 establishes accounting and reporting standards requiring that every derivative instrument, including certain derivative instruments
embedded in other contracts, be recorded in the balance sheet as either an asset or liability measured at its fair value. SFAS No. 133 requires that changes in the dervative's fair value be
recognized currently in earnings unless specific hedge criteria are met. Special accounting for qualifying hedges allows a derivative's gains or losses to offset related results on the hedged item in
the statement of operations and requires that a company must formally document, designate and assess the effectiveness of transactions that receive hedge accounting. The adoption of SFAS
No. 133 did not have a material effect on the Company's financial position or results of operations.

In
June 2001, the FASB issued SFAS No. 141 "Business Combinations". SFAS 141 eliminates the pooling-of-interests method of accounting for
business combinations except for qualifying business combinations that were initiated prior to July 1, 2001. In addition, SFAS 141 further clarifies the criteria to recognize intangible
assets separately from goodwill. The requirements of Statement 141 are effective for any business combination accounted for by the purchase method that is completed after June 30, 2001. The
adoption of SFAS No. 141 will not have a material effect on the Company's financial position or results of operations.

In
June 2001, the FASB issued SFAS No. 142, "Goodwill and Other Intangible Assets". Under SFAS 142, goodwill and indefinite lived intangible assets are no longer
amortized but are reviewed annually (or more frequently if impairment indicators arise) for impairment. Separable intangible assets that are not deemed to have an indefinite life will continue to be
amortized over their useful lives (but with no maximum life). The amortization provisions of SFAS 142 apply to goodwill and intangible assets acquired after June 30, 2001. The adoption
of SFAS No. 142 will not have a material effect on the Company's financial position or results of operations.

Item 2. Management's Discussion and Analysis or Plan of Operations

The
accompanying management's discussion and analysis of our financial condition and results of operations should be read in conjunction with Management's Discussion and Analysis of
Financial Condition and Results of Operations and our audited financial statements, and notes thereto, for the fiscal year ended December 31, 2000, included in our Annual Report on
Form 10-KSB for the year ended December 31, 2000.

7

---

Results of Operations

The following table sets forth certain Statements of Operations data as a percentage of revenues.

Third
Quarter
2001

Third
Quarter
2000

Nine
Months
Ended
2001

Nine
Months
Ended
2000Revenues

100.0
%
100.0
%
100.0
%
100.0
%Cost of revenues

69.8

64.6

64.4

58.5Gross profit

30.2

35.4

35.6

41.5Operating expenses:Selling

8.2

21.2

27.6

22.7General & administrative

108.2

84.3

106.2

91.0Research & product development

8.8

77.9

33.2

88.8Restrucuring Fees

8.2

0.0

2.3

0.0Total operating expenses

133.4

183.4

169.4

202.5Other income

1.0

4.3

1.4

6.5Net loss

(102.2
)%
(143.7
)%
(132.4
)%
(154.5
)%


Revenues

Revenues for the third quarter ended September 30, 2001 were $362,301 compared to $583,462 for the same period in 2000, a $221,161 decrease. The main
decrease in revenues for the third quarter was a reduction in our consulting line of business. Consulting revenues resulting from the execution of system integration projects for new customers were
reduced by approximately $157,000 in 2001. There was also a decrease in consulting work done for existing customers by approximately $16,000. TeleSmart revenues declined in the third quarter of 2001
compared to 2000 by approximately $19,000 due to a current customer discontinuing the use of one of our services designed to provide statistical formatted data on telecommunications network usage. We
also had a reduction in revenues by approximately $12,000 due to the discontinuation of report distribution by paper and disc methods at the end of 2000. Product/set-up fees were reduced
in the third quarter of 2001 by approximately $12,500 due to one-time fees for the creation of product demos for a customer, which occurred in 2000 but did not recur in 2001.

Year-to-date
revenues in 2001 were $1,281,310 compared to $1,652,934 in 2000, a $371,624 decrease. Year-to-date revenues declined
$228,802 in the consulting line of business. This decrease was partially a result of existing customers reducing their consulting projects in 2001 by approximately $171,000. Consulting revenues from
the system integration work needed to support new customers were also reduced by approximately $51,000 in 2001 compared to 2000. The TeleSmart line of business revenues for 2001 declined $76,661
compared to 2000. Over half of this decline (approximately $43,000) was the result of the discontined distribution of reports by paper and diskette. This decline was also a result of the discontinued
use of our services for telecommunication network statistics collection by approximately $30,000. In addition, TeleSmart revenues were also decreased as a result of one customer electing to prepay
their contractual minimum monthly payments in February in exchange for a 6% cash prepayment discount on their monthly minimum obligation for 2001. Product/set-up fees were down for the
year as a result of one-time events that occurred in 2000. These events

8

---

included such items as the creation of c.d. based product demos for approximately $37,000 and the migration of customers from the software product to the web product for approximately $24,000.

We
do not anticipate the downward trend in our revenue growth from 2000 to 2001 to continue into 2002. In an effort to increase revenues for the future we have been working on
creating new products for our customers' use that are complements or lead-ins to our current services. We are also expecting to launch a third Incumbent Local Exchange Carrier by the first
quarter of 2002.

Cost of Revenues

Cost of revenues for the third quarter ended September 30, 2001 were $252,964 compared to $376,899 for the same period in 2000, a decrease of $123,935.
This decrease was primarily caused by a reduction in expenses for the consulting line of business. The cost of revenues related to the consulting line of business declined by $87,769. The decreased
use of external consultants resulted in lower expenses for the consulting line of business by approximately $69,000. We also had lower personnel expenses of approximately $19,000 in this area due to
the staff reallocation from consulting projects to operational process support. These costs decreased due to fewer consulting projects in 2001. The TeleSmart line of business also had lower expenses
by $42,760 for the third quarter of 2001 compared to the third quarter of 2000. The decrease was a result of lower external consulting costs by approximately $41,000, which was off-set by
increased personnel costs of approximately $25,000 as a result of using more internal labor for the product. We also had decreased expenses for distribution costs of approximately $16,500 due to the
discontinuance of the paper and diskette delivery methods. Maintenance fees also decreased approximately $8,000.

Year-to-date
cost of revenues were $825,080 compared to $966,734 for the same period in 2000, a reduction of $141,654. The reduced cost of revenues was a
result of declining costs for the TeleSmart line of business. Costs decreased approximately $103,000 due to less use of external consultants somewhat off-set by increased use of internal
personnel. Personnel costs increased approximately $49,000. Distribution costs declined $44,000 due to the discontinuance of the paper and diskette delivery methods. Consulting cost of revenues were
reduced by $55,990. This reduction was a result of lower external consulting costs by approximately $71,000, which was off-set by increased personnel costs of approximately $17,000.

We
expect the lower use of external consultants to continue through the next 12 months. This is due to fewer consulting projects and our belief that our internal staff is able
to handle any additional projects that may arise. However, should some of the anticipated new projects be implemented on a tighter time-line or in a larger scale than anticipated this
would have a negative impact on our expenses. TeleSmart personnel costs may increase slightly due to the fact that the company has moved from a development phase into an operational phase. Therefore,
more internal employees will be focusing their efforts on maintaining and improving the current products. However, we do not expect the need to add additional personnel for this purpose.

9

---

Gross Profit Margin

Our gross profit margin decreased to 30% for the three months ended September 30, 2001 from 35% for the three months ended September 30, 2000.
For the nine months ended September 30, 2001, our gross profit margin was 36% compared to 42% for the nine months ended September 30, 2000. The declining gross profit margin was a result
of lower margin consulting projects being done in 2001 compared to 2000. However, the decreased margins for the consulting line of business was off-set by increased margins for our
TeleSmart line of business. This increase was a result of using more internal labor and fewer external consultants to deliver our services. The decline in the product/set-up fees line of
business was a result of the reduced one-time revenues and increased costs for changes needed in the delivery systems.

With
anticipated additional business, including the anticipated launch of another Incumbent Local Exchange Carrier, we expect our gross profit margin to increase. In our TeleSmart and
Product/Set-up fees lines of business many of our costs are either fixed or do not increase proportionately with our revenues.

Selling Expenses

Selling expenses for the third quarter of 2001 were $29,684 compared to $124,087 for the same period in 2000, a decrease of $94,403. This decrease was a result
of lower marketing consulting fees in the third quarter of 2001. We market, sell, and distribute our services to Incumbent Local Exchange Carriers. Our customers, in turn market, sell, and distribute
our services under their private brand to their retail customers. In the third quarter of 2000, we had increased spending by approximately $76,000 to help in the development of new marketing
strategies and campaigns, which were designed to enable us to gain greater control of the marketing and promotion of our services to retail customers. This strategy was tested in the second quarter of
2001. The response to this trial direct marketing campaign was not strong enough to demand a continuation of this marketing strategy at this time. Although, the company may test additional marketing
strategies in the future, the expenses related to the new marketing efforts are not expected to continue in the remainder of 2001. We also had a decrease in the third quarter of 2001 for public
relations expenses of approximately $12,000 since we were not undergoing any public relations efforts this year. In addition, we had a decrease of approximately $6,000 since we did not incur any
prospecting fees in 2001 related to the acquisition of new customers. It is our belief the selling expenses for the fourth quarter will remain the same.

Year-to-date
selling expenses for 2001 were $353,438 compared to $374,948 for the same period in 2000, a decrease of $21,510. This decrease was a result of
lower personnel costs of approximately $38,000 due to reduced headcount in the sales area. We also had reduced travel and entertainment expenses of approximately $27,000. Off-setting these
decreases was an increase in expenses related to the
development of new marketing strategies and campaigns tested in the second quarter of 2001 by approximately $43,000.

10

---

General and Administrative Expenses

General and administrative expenses for the third quarter ended September 30, 2001 were $391,881 compared to $491,717 for the same period in 2000, a
decrease of $99,836. This decrease was a result of lower professional fees, which included reductions in employment search fees by approximately $74,000 and consulting fees for internal computer
systems of approximately $16,000. These reductions were off-set by higher legal fees of approximately $34,000. We also had a reduction in personnel expense by approximately $39,000 due to
reduced headcount in comparison to the third quarter of 2000 and lower travel expenses by approximately $9,000.

Year-to-date
general and administrative expenses for 2001 were $1,361,098 compared to $1,504,866 for the same period in 2000, a decrease of $143,768. This
decrease in expenses was a result of lower professional fees, including reductions in employment search fees of approximately $75,000, consulting fees of approximately $96,000, and legal fees of
approximately $7,000. We also reduced our personnel expenses by approximately $47,000, training expenses by approximately $17,000, travel and entertainment expenses by approximately $13,000, and
office expenses by approximately $12,000. These decreases were off-set by increased expenses in depreciation of approximately $132,000.

Research and Product Development Expenses

Research and product development expenses for the third quarter ended September 30, 2001 were $31,826 compared to $454,353 for the same period in 2000,
a decrease of $422,527. This decrease was partially a result of the company restructuring as we moved from a development phase into an operation phase in July 2001. This change created a
reduction of personnel costs by approximately $135,000 for the third quarter of 2001 compared to 2000. Other major changes in this area included a reduction of depreciation by approximately $152,000
due to web equipment fully depreciating in 2000 and external consulting costs by approximately $133,000 due to the discontinued use of external consultants.

Year-to-date
research and product development expenses for 2001 were $425,778 compared to $1,467,042 for the same period in 2000, a decrease of $1,041,264.
This was mainly due to decreased external consulting costs of approximately $477,000 as we increased use of internal personnel at the beginning of 2001 and discontinued the use of the external
consultants. We also had a reduction of personnel
costs for the year of approximately $73,000 due to the restructuring. Other expenses reduced in 2001 were depreciation of approximately $445,000 due to web-based software being fully
depreciated in 2000.

It
is anticipated that the company will continue to have reduced research and product development expenses. This is due to the shift of the company from a development phase and into
an operational phase. We do not anticipate any new hires in this area or the use of external consultants.

11

---

Restructuring Fees

In the three and nine months ended September 30, 2001, we had restructuring fees of $29,906 compared to no restructuring fees in the same periods for
2000. The restructuring fees in 2001 were a result of the company shifting from a developmental phase into an operational phase in July 2001. This shift resulted in the reduction of 9 positions
from within the company. As the majority of the development work has been completed on the TeleSmart web technology, fewer personnel resources are needed to implement the technology than were involved
in the development of the technology. Fees for the restructuring included severance packages, legal fees and accounting fees. With this shift in the organization, we expect the related personnel
expenses to continue for the foreseeable future.

Other Income and Expense

Interest income for the third quarter ended September 30, 2001 was $3,725 compared to $24,901 for the same period in 2000, a decrease of $21,176.
Year-to-date interest income for 2001 was $17,575 compared to $107,382 for the same period in 2000, a decrease of $89,807. The decrease was a result of lower cash and cash
equivalents held during the three month and nine month periods ended September 30, 2001 compared to the same periods in 2000.

Net Loss

We incurred a net loss of $370,235 for the three months ended September 30, 2001 compared to a net loss of $838,693 for the three months ended
September 30, 2000, a decrease of $468,458. For the nine months ended September 30, 2001 and 2000, we incurred net losses of $1,696,415 and $2,553,224. The decrease in our net loss was
mainly attributed to lower research and product development expenses as noted above.

Impact of Recently Issued Accounting Standards

Statement of Financial Accounting Standards (SFAS) No. 133, "Accounting for Derivative Instruments and Hedging Activities," as amended, is effective for
years beginning after June 15, 2000. SFAS No. 133 establishes accounting and reporting standards requiring that every derivative instrument, including certain derivative instruments
embedded in other contracts, be recorded in the balance sheet as either an asset or liability measured at its fair value. SFAS No. 133 requires that changes in the dervative's fair value be
recognized currently in earnings unless specific hedge criteria are met. Special accounting for qualifying hedges allows a derivative's gains or losses to offset related results on the hedged item in
the statement of operations and requires that a company must formally document, designate and assess the effectiveness of transactions that receive hedge accounting. The adoption of SFAS
No. 133 did not have a material effect on the Company's financial position or results of operations.

In
June 2001, the FASB issued SFAS No. 141 "Business Combinations". SFAS 141 eliminates the pooling-of-interests method of accounting for
business combinations except for qualifying business combinations that were initiated prior to July 1, 2001. In addition, SFAS 141 further clarifies the criteria to recognize intangible
assets separately from goodwill. The requirements of Statement 141 are effective for any business combination accounted for by the purchase method that is completed after June 30, 2001.

12

---

The adoption of SFAS No. 141 will not have a material effect on the Company's financial position or results of operations.

In
June 2001, the FASB issued SFAS No. 142, "Goodwill and Other Intangible Assets". Under SFAS 142, goodwill and indefinite lived intangible assets are no longer
amortized but are reviewed annually (or more frequently if impairment indicators arise) for impairment. Separable intangible assets that are not deemed to have an indefinite life will continue to be
amortized over their useful lives (but with no maximum life). The amortization provisions of SFAS 142 apply to goodwill and intangible assets acquired after June 30, 2001. The adoption
of SFAS No. 142 will not have a material effect on the Company's financial position or results of operations.

Liquidity and Capital Resources

We had cash of $331,127 and working capital of $25,210 as of September 30, 2001. Cash used in operating activities during the nine-month
period ended September 30, 2001 was $854,443. Cash used in investing activities was $83,165 for the purchase of property and equipment. In addition, we have
received net proceeds of approximately $615,133 from the private placement completed in the second quarter of 2001.

Although
we do not believe that current cash levels are sufficient to support us through the next twelve months, we are currently pursuing alternative methods of injecting cash into
the company either through the means of prepaid revenues from our existing customers or establishing a line of credit with a lender. Management believes that it is likely that we will obtain
additional funding from one of these alternatives. In addition, we are expecting the launch of the third Incumbent Local Exchange Carrier by the first quarter of 2002.

With
the launch of an additional customer and either prepaid revenues or establishing a new line of credit, we believe we will have enough cash to support our operating capital needs
for the next twelve months assuming we are able to generate sufficient revenues and control expenses. Our projections with respect to our ability to meet our working capital requirements are based
upon: (i) generating sales that maintain our third quarter 2001 sales; and (ii) avoiding any significant increase in expenses. Failure to meet either of these objectives or the inability
to inject cash into the organization would have a material adverse effect on our business.

Although
we believe we will either receive prepaid revenues or establish a new line of credit, increase our revenues and improve our cash flow, there are no assurances that we will be
successful in doing so. If we are unsuccessful in our efforts of receiving either the prepaid revenues or the new line of credit, we have sufficient cash and working capital to operate our business
through December 31, 2001. In that event, we would seek additional equity financing to continue operations. There is no assurance that any additional capital will be available to us on
acceptable terms, if at all. We may issue equity securities at a price that would result in significant dilution to existing shareholders.

13

---

Forward Looking Statements

This Form 10-QSB contains certain 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. All statements included herein regarding the paragraph on expected revenue trends in the Revenuessection, the paragraph regarding
the lower use of external consultants and increased personnel costs due to the restructuring changes in the Cost of Revenuessecdtion, the expected gross profit margin increases in theGross Profit Marginsection, the expected decline in marketing expenses in theSelling Expensessection, the anticipated decline in research and development expenses in the Research and Product
Development Expensessection, the anticipated personnel expense levels in theRestructuring
Feessection and our ability to meet working capital requirements and raise additional funds in theLiquidity and Capital
Resourcessection, and other statements that address activities, events or developments that we expect, believe or anticipate will or may occur in the future, including such
things as future capital
expenditures (including the amount and nature thereof), business strategy and measures to implement strategy, competitive strengths, goals, expansion and other such matters are forward-looking
statements. Actual events may differ materially from those anticipated in the forward-looking statements. Important factors that may cause such a difference include our possible inability to raise
additional funds, long sales cycles for new customers, significant reliance on our current small number of customers, limited number of potential customers, general economic conditions, our reliance
on a small number of products, changes in interest rates, increased competition in our market area, technological changes and developments, our reliance on key executives, and increased regulation of
the telecommunications industry in general. For additional information regarding these and other factors, see our Annual Report on Form 10-KSB for the year ended December 31,
2000 and other recent filings with the Securities and Exchange Commission.

PART II Other Information

Item 1. Legal Proceedings

We
are not a party to any material legal proceedings.

Items 2. through 5. Not Applicable

Item 6. Exhibits and Reports on Form 8-K

14

---



OneLink, Inc.

SIGNATURES

Pursuant to the registration 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.

|                        |  | ONELINK, INC.(Registrant)
|----------------------- |  | -------------------------
|Date: November 12, 2001 |  | BY:                      
|                        |  | BY:                      

15

---



Exhibit Index

OneLink, Inc.
Form 10-QSB

|Exhibit Number |  | Description                             
|-------------- |  | ----------------------------------------
|11             |  | Computation of Net loss Per Common Share

16

---

QuickLinks