<PAGE>   1
                    U.S. SECURITIES AND EXCHANGE COMMISSION
                              WASHINGTON, DC 20549

                            ------------------------

   
                                 FORM 10-KSB/A
                                Amendment No. 1
    

(Mark One)
[X] ANNUAL REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF
    SECURITIES EXCHANGE ACT OF 1934. 

For the fiscal year ended   December 31, 1997
                         ---------------------------------------------------
                                       OR

[ ] TRANSITION REPORT UNDER SECTION 13 OR 15(d)OF THE SECURITIES EXCHANGE ACT
    OF 1934.

For the transition period from ______ to ______

                         Commission file number 0-23111

                                CABLE LINK, INC.
-------------------------------------------------------------------------------
                 (Name of Small Business Issuer in Its Charter)

           Ohio                                          31-1239657
-------------------------------                ---------------------------------
(State or Other Jurisdiction of                       (I.R.S. Employer
Incorporation or Organization)                       Identification No.)

280 Cozzins Street, Columbus, Ohio                         43215
----------------------------------------       ---------------------------------
(Address of Principal Executive Offices)                 (Zip Code)


                                 (614) 221-3131
--------------------------------------------------------------------------------
               (Issuer's Telephone Number, Including Area Code)

         Securities registered under Section 12(b) of the Exchange Act:

                                                  Name of Each Exchange
   Title of Each Class                             on Which Registered
   -------------------                            ---------------------

       None              
---------------------------------      ----------------------------------------

---------------------------------      ----------------------------------------

         Securities registered under Section 12(g) of the Exchange Act:

                                  Common Stock
--------------------------------------------------------------------------------
                                (Title of Class)

--------------------------------------------------------------------------------
                                (Title of Class)

   
This Amendment is being filed to amend Part I, Item 6, Part F/S Financial 
Statements, and Part II, Items 1 and 3.
    

<PAGE>   2



                                     PART I
                                 ALTERNATIVE 2
                       ITEMS 6-11 OF MODEL B OF FORM 1-A

ITEM 6.  DESCRIPTION OF BUSINESS

THE COMPANY

         The core business of Cable Link, Inc. (the "Company" or "Registrant")
is the refurbishment, repair and sale of previously owned cable television
("CATV") equipment. The Company purchases the equipment from cable operators who
have surplus due to either an upgrade in their system or an overstock in their
warehouse. This equipment is sold both "as is" and refurbished to CATV operators
throughout North America, South America, Mexico and the Pacific Rim. The Company
supplies virtually any type of electronic equipment a cable operator would use,
from the headend (receiving and transmitting site) to the converter box at the
customer's home. The Company distributes new equipment and acts as a consignment
agent for new equipment, on behalf of equipment manufacturers. The Company has
been recognized by Scientific-Atlanta as an Authorized Parts Distributor and a
New Products Distributor. The Company entered into a Distribution Agreement with
Scientific-Atlanta, Inc. ("SA") effective as of March 1, 1997, whereby the
Company was appointed as a non-exclusive distributor to purchase products of SA
for its own account and to resell to customers within the United States. Unless
terminated earlier as provided in the Agreement, the term will expire on
December 31, 1998. The Agreement provides that the Company will meet quarterly
purchase quotas established by SA and presented in writing to the Company prior
to the beginning of each quarter. This Agreement is designed to enhance the
Company's previous agreement with SA for the sale and distribution of
refurbished equipment. SA is the second largest manufacturer of cable television
equipment in the world. Historically, revenues of the Company break down to be
approximately 64% attributable to sales of refurbished equipment, 10% from the
repair of cable equipment, 16% from the brokerage of used products which the
Company does not repair or refurbish, 1% from the sale of new and used parts and
approximately 9% from the sale of new equipment, including equipment sold on
consignment basis. The Company anticipates that its revenues, as a percentage of
the total, will grow in the areas of repair and sales of new equipment.

         The Company has historically received a portion of its revenue from
sales in the international market (22% in 1995, 9% in 1996 and 11% in 1997).
Because CATV penetration is low in many foreign countries, management of the
Company believes that the international market presents an additional
opportunity for the sale of the Company's products and equipment. The Company
currently conducts business in South America, Mexico, China and the Pacific
Rim. The Company's foreign operations are subject to the usual risk inherent in
situating operations abroad, including risks with respect to economic and
political destabilization, currency fluctuations, restrictive actions by
foreign governments, nationalization, the law and policies of the United States
affecting trade, foreign investments and loans and foreign tax laws.

         The Company has been issued a small business credit insurance policy
from the United States Export Import Bank ("EX-IM Bank"). The EX-IM Bank is a
United States government agency established to promote export growth. This
policy will allow the Company to extend credit terms to qualified international
customers and have guaranteed payment. The EX-IM Bank will insure the
receivable against 100% political risk and 95% commercial risk for terms up to
one year. EX-IM Bank also provides special capital goods project financing for
terms of one to ten years which will allow the Company to provide long term
financing for CATV capital equipment and participate in large projects.

         The Company issued a Promissory Note to The Provident Bank on April 30,
1997 in the original amount of $750,000 under a Loan and Security Agreement
dated November 17, 1996. This amount was subsequently increased to $850,000.
Interest is payable monthly beginning May 30, 1997 at the rate of 1% over the
Bank's prime rate. Principal is due and payable on demand or no later than April
30, 1998. The proceeds of the loan were used for working capital and operating
expenses. Loan financing will be considered on large purchases when it is
necessary to secure the purchase. Currently, the Company utilizes the bank line
of credit when required. There would be a risk of default under loan financing
if the income of the Company was insufficient to service debt.

         The Company believes that there are significant opportunities for CATV
equipment sales both domestically and internationally. In the United States,
the CATV industry is experiencing an increase in capital spending as compared
to the previous two years which increase is likely attributable to, among other
things, less uncertainty concerning federal regulation of the CATV industry and
the continued development and emergence of new technology in the industry,
including fiber optics and digital compression. CATV operators are offering an
expanded menu of services to their subscribers and can increase rates along
with the service enhancements. The ability to increase rates to subscribers
provides the necessary incentive to CATV operators to upgrade channel capacity
and create additional tiers of programming. The Company sells and develops
equipment to allow CATV operators to increase channel capacity and better
manage subscriber services and rates. Further, CATV operators and suppliers,
including the Company, are demonstrating that system upgrades with currently
available equipment and system architectures can be used as a basis to provide
advanced subscriber services. Management of the Company believes that, for the
most part, the international CATV industry and market is a few steps behind the
United States market and that there will continue


                                       2
<PAGE>   3

to be an increase of system upgrades and capital spending to develop more
advanced CATV systems abroad and the Company is well-positioned to participate
in the development of the CATV industry abroad.

         The Company was incorporated under the laws of the State of Ohio on
December 28, 1987. The Company operates both its administrative and
manufacturing operations from a single, leased facility at 280 Cozzins Street,
Columbus, Ohio 43215. Its telephone number is (614) 221-3131.

STRATEGY

         The basic strategy of the Company is to: (a) maintain and expand its
current customer base in the United States for the sale of refurbished CATV
equipment while focusing on expanding the repair side of the United States
market, (b) continue to develop new markets offshore in South America, Mexico,
China, Russia and the Pacific Rim, and (c) increase the Company's new product
distribution.

         The Company has a wide range of capabilities including the
manufacturing and sale of a variety of products designed to receive or transmit
satellite channels and local broadcast channels. The technical expertise of the
Company's engineering staff coupled with state-of-the-art test equipment enable
the Company to offer a wide range of refurbished CATV equipment, including
receivers, processors and modulators that handle the signals for delivery to
the cable subscriber. Other remanufactured products include amplifiers, line
extenders and converters. The engineering team continually researches upgrades
of line gear and converters to higher channel capabilities for domestic markets
and to formats necessary for sale in international markets.

         The Company believes that the CATV industry is going through a
metamorphosis, from an entertainment service in the home to being the focal
point of a converging telecommunications marketplace serving both homes and
businesses. Technological innovation is hurdling the political and legal
obstacles which have prevented earlier convergence. As these obstacles are
removed, the Company believes that there will be a greater demand for services
such as those which the Company provides. Management believes the Company is
well-positioned to thrive and prosper in this industry.

INDUSTRY AND MARKET BACKGROUND

         CATV is a service that delivers multiple channels of television to
subscribers who pay a monthly fee for the services they receive. A CATV system
consists of four principal components. The first is the "up-link," where the
programmer's signal is first scrambled and addressed, and is then transmitted
to a C-band satellite. The second, known as a cable system "headend" facility,
receives television signals from satellites and other sources. The headend
facility organizes and retransmits those signals through the third component,
the distribution network, to the subscriber. The third principal component is
the distribution network which consists of fiber optic and coaxial cables and
associated electronic equipment which originate at the headend and extend
throughout the CATV system. The fourth component of the CATV system, the
subscriber equipment, is comprised of a "dropwire" which extends from the
distribution network to the subscriber's home and connects either directly to
the subscriber's television set or to a converter box. An addressable converter
box is a home terminate device which permits the efficient delivery of premium
CATV services, including pay-per-view programming, by enabling the CATV
operator to control CATV subscriber services from a central headend computer.

         CATV operators generally offer to subscribers a basic service package
and, for additional charges, additional tiers of services, including premium
services. Basic service programming typically includes broadcast network local
affiliates, independent television stations and other locally originated
programs. Additional tiers of service may consist of different
satellite-delivered services and premium services, such as HBO and Showtime,
that typically are offered to subscribers as a package for a separate monthly
fee. Successive tiers of programming include additional services for additional
monthly fees. In addition, movies and special entertainment events, such as
boxing matches and Olympic Games can be offered to subscribers with addressable
converters on a selective, pay-per-view basis. CATV operators



                                       3
<PAGE>   4

are also introducing digital cable audio services which consist of multiple
channels of commercial-free, compact disc quality music.

CAPITAL EXPENDITURES IN THE CATV INDUSTRY

         Construction, maintenance, expansion and upgrade of CATV systems
require significant capital expenditures by CATV operators for system
components, including coaxial and fiber optic cable, traditional radio
frequency ("RF") amplifiers and fiber optic electronics, and addressable system
controllers and converters.

         A major trend in the cable and satellite television industry has been
the continuing expansion of channel capacity in response to CATV operators'
desire to provide subscribers with more programming selections, including
pay-per-view and additional premium programming services.

         The Company expects that CATV operators will continue to spend to
upgrade the technological capabilities of their systems and increase channel
capacity in order to meet subscriber demand for more programming services, such
as expanded pay-per-view, premium services and digital cable audio, which, in
turn, provides opportunities for increased revenues for the CATV operators. In
addition, new technologies can improve a CATV operator's margins and customer
services by increasing the CATV system's reliability, picture quality and the
"user friendliness" of the converter. The Company also expects CATV operators
to increase spending to meet governmental requirements for renewing franchises
and to position themselves to enter new and potential markets such as telephone
and personal communications networks.

         With the passage of the Telecommunications Act of 1996, there will be
additional opportunities for the Company. The Act immediately deregulates rates
for some small operators while providing for deregulation to the large
operators over the next several years as cable competition comes into the
marketplace. This expands the opportunities for the Company as cable operators
are gearing up their rebuilds to remain competitive and creating new start-up
operations from which the Company can generate both sales and repair business.

         With respect to technology, CATV operators and suppliers, including
the Company, are demonstrating that system upgrades with currently available
equipment and system architectures can be used as a basis to provide advanced
subscriber services.

         Moreover, the growing use of United States broadband system designs
and equipment in international markets, where CATV penetration is low, presents
another opportunity for sales of the Company's systems and equipment.

SALES AND MARKETING

         The majority of the Company's sales activity is generated through
personal relationships developed by its sales personnel and executives,
telemarketing and direct mail to cable operators both in the United States and
abroad. The Company has developed contacts with the major CATV operators in the
United States and is constantly in touch with these operators regarding plans
for upgrading or expansion and their needs to either purchase or sell
equipment. The Company employs a bilingual individual in the sales department
for the international market and several other sales persons to service the
United States. The Company purchases a large amount of its inventory from cable
operators who have upgraded, or are in the process of upgrading their system.
The sales and purchasing functions operate under the same umbrella using a
computerized buy/sell board to coordinate the activity between the two. In
addition, the Company has very close relationships with major manufacturers of
CATV equipment and purchases a large amount of such equipment from these
original equipment manufacturers. Daily meetings of the sales and purchasing
functions keep both aware of what is available to be purchased and what is
needed to fill sales orders.

         The Purchasing Department buys previously used CATV equipment
throughout North America. As a result of competition in the communications
industry, cable operators are aggressively upgrading their system with newer,
technologically advanced equipment. This provides the Company's purchasing
department opportunities to buy equipment which were not normally available to
the Company in the past. This competitive CATV market enables the



                                       4
<PAGE>   5

Company to acquire additional inventory for sale to cable operators who are
expanding with new subscribers or who are upgrading their system with the
newer, more expensive technology. The Company employs three purchasing agents.

   
         As of December 31, 1997, no customer accounted for more than 10% of the
Company's accounts receivable balance. The Company is not dependent on one or a
few customers to support its business. There are approximately 6,000 cable
television systems within the United States, each of which is a potential
customer. The international market continues to expand which creates additional
potential customers for the Company. The Company is also not dependent on any
one supplier.
    

         The Company entered into a two-year agreement with Fanch
Communications Inc. on September 15, 1997 whereby the Company agreed to assist
Fanch Communications in the transfer and repair of Fanch's converters, headend,
test equipment and amplification equipment. Fanch communications is the 20th
largest multi-system operator in the country with 500,000 customers in its
cable systems.

ENGINEERING

         The Company's engineers aggressively seek to implement existing
technological developments as they strive to meet the needs of the Company's
customers.

         Recent advances in technology and new federal regulations have
prompted competitive upgrade activity among cable systems operators. The
Company's engineering department is well-equipped to handle the needs of
systems operators. The Address Reader for the Oak RTC-56 and the Addressable
Prom Programmer for the Jerrold DRZ are two replacement products redesigned and
built by the engineering department to help meet customers' upgrading needs.

         The engineering department strives to ensure the Company's on-going
commitment to quality and service is upheld by continually upgrading linegear
and converters to higher channel capabilities for United States markets and to
formats necessary for international markets. The department has the ability to
perform required FCC systems tests, both in-house and on-site, and maintains a
staff that is experienced in analog video, digital, and radio frequency (RF).

COMPETITION

   
         There are a number of businesses similar to the Company throughout the
United States engaged in buying and selling used CATV equipment. The two major
competitors of the Company are Contec Limited Partnership in the repair area and
VueScan, Inc. in the sales area.
    

   
         The CATV industry is highly competitive and is characterized by
numerous companies competing in various segments of the market. Many of the
Company's competitors have greater name recognition, more extensive engineering,
production and marketing capabilities and greater financial, technological and
personnel resources than the Company. In addition, certain companies in the CATV
industry have expanded their product lines in recent years as a result of
acquisitions. New and used inventory items are separately identified as items of
inventory. The weighted average cost is calculated per item of inventory.
Impairment and changes in market value are evaluated on a per item basis. There
can be no assurance that the Company will be able to compete successfully in the
future with existing or new competitors.
    

EMPLOYEES AND TRAINING

         As of December 31, 1997, the Company had 80 full time employees, 52 of
which work on the repair and refurbishment of converters and other cable TV
equipment. There are 10 employees in shipping and receiving, 10 employees in
the sales and purchasing department, and the remaining eight are in finance and
general administration. New production employees are placed on a six week
training program during which they are paired with an experienced technician.
None of the Company's employees is covered by a collective bargaining agreement
and management believes that the Company's relationship with its employees is
good. Key employees may be eligible to participate in the Company's stock
option plan.

CONTROL AND INFORMATION SYSTEMS

         The Company uses a personal computer based network system to control
customer orders, sales orders, shipments, accounts receivable, inventory,
general ledger and accounts payable. All payrolls are prepared by an outside
service. The current configuration of hardware and software meets the present
needs of the Company, and is flexible enough to allow for expansion in the
future. The Company completed implementation of its computer information system
in 1996.

PRODUCTS

         The majority of the Company's business is the sale of used CATV
equipment. The Company purchases the equipment from cable operators and
equipment manufacturers who have surplus inventory due to either an upgrade in
their system, an overstock in their warehouse, or due to overruns or
cancellations of orders or trade-ins or upgrades. This equipment is sold both
"as is" and refurbished to CATV operators throughout North America, South
America, Mexico and the Pacific Rim. The Company supplies virtually any type of
electronic equipment a cable operator would use, from the headend (receiving
and transmitting site) to the converter box in the customer's home. In addition
to the refurbished products, the Company also distributes some new products and
repairs converters, linegear and headend equipment.



                                       5
<PAGE>   6

         Following is a list of the products sold by the Company with a brief
description of the application of each product line:

         Converters. Converters come in many different forms (addressable,
descrambling and non-descrambling or "plain-Jane") and bandwidths from 300 MHz
(36 channels) to 750 MHz (115 channels). The majority of cable operators in the
world use some type of converter in their system. The Company specializes in
sales and repair of the Jerrold, Scientific Atlanta, Zenith, Hamlin, Pioneer
and Oak lines of converters and also sells and repairs most other
manufacturers' products.

         Linegear. Linegear encompasses all products which are actually placed
on the cable line. This includes active electronics, trunk stations and line
extenders, which amplify and distribute the cable signal, and passive equipment
such as taps, splitters and directional couplers, which simply pass the signal
through for delivery to additional lines and the customer's home. The Company
sells and repairs all manufacturers' linegear products.

         Headend. The headend is perhaps the most important part of the cable
system since this is where the signal is received, processed and transmitted to
the customer's home. For that reason, this particular product requires the most
technical expertise. This product line includes satellite receivers,
modulators, processors, encoders and videociphers, all of which are used to
provide cable delivered signal. If the cable operator's headend equipment is
not calibrated and maintained properly, the customer will receive poor picture
quality. The Company specializes in refurbishing and repairing various
manufacturer's lines of headend products as well as modifying these for use in
different video formats.

CONSIGNMENT INVENTORY PROGRAM

         In addition to the Company's own inventory assets, it also has
recently achieved access to CATV equipment through a consignment program which
does not require payment for the equipment until 30 days after the sale. This
is done through both stocking of consignment inventory at the Company's
warehouse as well as having access to excess inventory at a vendor's location.
Consignment programs have been established with Tele Communications, Inc.,
Scientific Atlanta, Inc., Continental Cablevision and Time-Warner, Inc.

   
    



                                       6
<PAGE>   7



                                     PART II

ITEM 1. MARKET PRICE OF AND DIVIDENDS ON THE REGISTRANT'S COMMON EQUITY AND
OTHER SHAREHOLDER MATTERS

         The principal market where the Registrant's equity is traded is the
Nasdaq Bulletin Board. The range of high and low bids for the Registrant's
equity for each quarter during its past two fiscal years is as follows:

   
<TABLE>
<CAPTION>
         Year                       Quarter                   High                      Low
         ----                       -------                   ----                      ---
         <S>                        <C>                       <C>                       <C>
         1997                       4th                       4.13                      2.88 
                                    3rd                       3.29                      2.44 
                                    2nd                       3.16                      1.74   
                                    1st                       4.63                      1.37 
         1996                       4th                       1.15                       .33 
                                    3rd                       2.13                       .63 
                                    2nd                       2.88                      1.32 
                                    1st                       2.29                       .33
</TABLE>
    

         The above quotations reflect inter-dealer prices, without retail
mark-up, mark down or commission and may not represent actual transactions.
There are approximately 100 record holders of the common shares of the
Registrant. All amounts shown herein have been adjusted for prior stock splits
and stock dividends.

DIVIDEND POLICY. 

         The Registrant has not declared or paid any cash dividends on its
common shares since its inception, and the Board of Directors presently intends
to retain all earnings for use in the business for the foreseeable future.

   
    

ITEM 3.  CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS

   
     On September 23, 1996, the Registrant's former principal accountants
resigned. No reports or financial statements issued by the former accountants
contained an adverse opinion or disclaimer of opinion or was modified as to
uncertainty, audit scope or accounting principles. There were no disagreements
with the former accountants. Groner, Boyle & Quillin LLP was engaged as the
Registrant's principal accountants on October 23, 1996.
    

                                      -7-
<PAGE>   8





                                    PART F/S


                              FINANCIAL STATEMENTS


                                   * * * * * *


                           DECEMBER 31, 1997 AND 1996






                                      -8-
<PAGE>   9




                                 C O N T E N T S




                                                                   Page

   
INDEPENDENT AUDITORS' REPORT                                        10

BALANCE SHEETS                                                      11

STATEMENTS OF INCOME                                                13

STATEMENTS OF CHANGES IN STOCKHOLDERS' EQUITY                       14

STATEMENTS OF CASH FLOWS                                            15

NOTES TO FINANCIAL STATEMENTS                                       17
    

                                      -9-
<PAGE>   10
        GRONER, BOYLE & QUILLIN, LLP
Certified Public Accountants and Consultants
           500 South Front Street
              P.O. Box 182108
         Columbus, Ohio 43218-2108
          Telephone (614) 221-1120
            FAX (614) 227-6999



To the Board of Directors and Stockholders
Cable Link, Inc.
Columbus, Ohio


                          INDEPENDENT AUDITORS' REPORT
                          ----------------------------

     We have audited the accompanying balance sheet of Cable Link, Inc. as of
December 31, 1997 and 1996, and the related statements of income, stockholders'
equity, and cash flows for the years then ended. These financial statements are
the responsibility of the Company's management. Our responsibility is to
express on these financial statements based on our audits.

     We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements are free of
material misstatement. An audit includes examining on a test basis, evidence
supporting the amounts and disclosures in the financial statements. An audit
also includes assessing the accounting principles used and significant
estimates made by management, as well as evaluating the overall financial
statement presentation. We believe that our audits provide a reasonable basis
for our opinion.

     In our opinion, the financial statements referred to above present fairly,
in all material respects, the financial position of Cable Link, Inc. as of
December 31, 1997 and 1996 and the results of its operations and its cash flows
for the years then ended in conformity with generally accepted accounting
principles.


                                      /s/ GRONER, BOYLE & QUILLIN, LLP

Columbus, Ohio
January 29, 1998


                                      -10-
<PAGE>   11
                                CABLE LINK, INC.

                                 BALANCE SHEETS

                           December 31, 1997 and 1996

--------------------------------------------------------------------------------


                                     ASSETS

                                                 1997                1996
                                             -----------         -----------

CURRENT ASSETS
      Cash                                   $   204,990         $   115,796
      Accounts receivable, net                 1,135,607             736,563
      Income taxes receivable                        -               102,422
      Inventories                              1,332,619           1,176,309
      Prepaid consulting                          72,955              45,755
      Prepaid and other assets                    88,489              41,814
      Deferred income taxes                       36,500                 -
                                             -----------         -----------
           Total current assets                2,871,160           2,218,659
                                             -----------         -----------

PROPERTY AND EQUIPMENT, at cost
      Furniture and fixtures                     585,740             510,587
      Equipment                                  683,767             622,988
      Leasehold improvements                     175,425             175,425
      Construction in progress                    21,832              14,440
                                             -----------         -----------
                                               1,466,764           1,323,440
      Less accumulated depreciation             (774,125)           (604,311)
                                             -----------         -----------
           Net property and equipment            692,639             719,129
                                             -----------         -----------

COVENANT NOT TO COMPETE AND
  OTHER ASSETS, net                               34,130              42,040
                                             -----------         -----------




           TOTAL ASSETS                      $ 3,597,929         $ 2,979,828
                                             ===========         ===========


The accompanying notes are an integral part of the financial statements.


                                      -11-
<PAGE>   12
--------------------------------------------------------------------------------


                      LIABILITIES AND STOCKHOLDERS' EQUITY

<TABLE>
<CAPTION>

                                                          1997              1996
                                                      ----------        -----------

<S>                                                   <C>               <C>        
CURRENT LIABILITIES
      Current portion of long-term obligations        $   82,354        $   101,703
      Revolving credit line                              290,957            607,090
      Accounts payable                                   765,269          1,313,344
      Income taxes payable                               138,742                -
      Accrued expenses
           Payroll and related taxes                     299,857            149,060
           Other                                          30,141             36,043
                                                      ----------        -----------
                Total current liabilities              1,607,320          2,207,240

LONG-TERM OBLIGATIONS                                     53,412            106,762

DEFERRED INCOME TAXES                                     48,000                -
                                                      ----------        -----------

           Total liabilities                           1,708,732          2,314,002
                                                      ----------        -----------

STOCKHOLDERS' EQUITY
      Common stock, no par value                       1,449,706          1,093,662
      Additional paid-in capital                         136,136            136,136
      Retained earnings (deficit)                        303,355           (563,972)
                                                      ----------        -----------
           Total stockholders' equity                  1,889,197            665,826
                                                      ----------        -----------



           TOTAL LIABILITIES AND STOCKHOLDERS'
             EQUITY                                   $3,597,929        $ 2,979,828
                                                      ==========        ===========
</TABLE>



The accompanying notes are an integral part of the financial statements.

                                      -12-
<PAGE>   13
                                CABLE LINK, INC.

                              STATEMENTS OF INCOME

                     Years Ended December 31, 1997 and 1996

--------------------------------------------------------------------------------


   
<TABLE>
<CAPTION>


                                                                 1997                 1996
                                                             ------------         -----------

<S>                                                          <C>                  <C>        
Revenues                                                     $ 10,094,178         $ 8,248,814

Cost of revenues                                                6,277,709           5,612,731
                                                             ------------         -----------

           Gross profit                                         3,816,469           2,636,083

Selling, general and administrative expenses                    2,746,073           2,649,568
                                                             ------------         -----------

Income (loss) from operations                                   1,070,396             (13,485)
                                                             ------------         -----------

Other income (expense)
      Interest expense                                            (60,541)            (84,112)
      Gain on sale of assets                                          --                3,007
      Reconciliation with vendors                                 112,197              93,518
      Other                                                         2,824               1,658
                                                             ------------         -----------
           Total other income (expense)                            54,480              14,071 
                                                             ------------         -----------

Income before income taxes                                      1,124,876                 586

Provision (benefit) for income taxes
      Current                                                     246,049             (17,628)
      Deferred                                                     11,500                 -
                                                             ------------         -----------
           Total provision (benefit) for income taxes             257,549             (17,628)
                                                             ------------         -----------

Net income                                                   $    867,327         $    18,214
                                                             ============         ===========


Basic earnings per share                                     $       0.54                0.01
                                                             ============         ===========

Weighted average shares outstanding used
  to compute basic earnings per share                           1,591,976           1,370,860
                                                             ============         ===========


Diluted earnings per share                                   $       0.45         $      0.01
                                                             ============         ===========

Weighted average shares outstanding used
  to compute diluted earnings per share                         1,913,958           1,411,748
                                                             ============         ===========
</TABLE>
    










    The accompanying notes are an integral part of the financial statements.

                                      -13-
<PAGE>   14
                                CABLE LINK, INC.

                  STATEMENTS OF CHANGES IN STOCKHOLDERS' EQUITY

                     Years Ended December 31, 1997 and 1996

--------------------------------------------------------------------------------

<TABLE>
<CAPTION>


                                    Shares of Issued                    Additional
                                    And Outstanding        Common         Paid-In           Retained
                                     Common Stock           Stock         Capital           Earnings            Total
                                     ------------           -----         -------           --------            -----

<S>                                     <C>              <C>               <C>             <C>               <C>       
BALANCE - DECEMBER 31,
1995                                    1,349,804        $1,032,062        $136,136        $(582,186)        $  586,012

Exercise of options and warrants           34,848            61,600             -                -               61,600

Net income                                    -                 -               -             18,214             18,214
                                        ---------        ----------        --------        ---------         ----------

BALANCE - DECEMBER 31,
1996                                    1,384,652         1,093,662         136,136         (563,972)           665,826

Issuance of common stock, net of
  issuance cost of $50,893                165,000           149,107             -                -              149,107

Exercise of options and warrants          124,150           206,937             -                -              206,937

Net income                                    -                 -               -            867,327            867,327
                                        ---------        ----------        --------        ---------         ----------

BALANCE - DECEMBER 31,
1997                                    1,673,802        $1,449,706        $136,136        $ 303,355         $1,889,197
                                        =========        ==========        ========        =========         ==========
</TABLE>





    The accompanying notes are an integral part of the financial statements.

                                      -14-
<PAGE>   15
                                CABLE LINK, INC.

                            STATEMENTS OF CASH FLOWS

                     Years Ended December 31, 1997 and 1996

--------------------------------------------------------------------------------

<TABLE>
<CAPTION>

                                                                   1997              1996
                                                                ---------         ---------

<S>                                                             <C>               <C>      
CASH FLOWS FROM OPERATING ACTIVITIES:
      Net income                                                $ 867,327         $  18,214
                                                                ---------         ---------
      Adjustments to reconcile net income to net cash
        provided by operating activities:
           Depreciation and amortization                          174,599           156,717
           Bad debts                                               29,450            11,059
           Deferred income taxes                                   11,500               -
           Gain on sale of assets                                     -              (3,007)
           (Increase) decrease in operating assets:
                Accounts receivable                              (428,494)          294,779
                Income tax receivable                             102,422           (33,518)
                Inventories                                      (156,310)          (27,073)
                Prepaid and other assets                          (70,750)          (30,097)
           Increase (decrease) in operating liabilities:
                Accounts payable                                 (548,075)          164,925
                Income tax payable                                138,742               -
                Accrued expenses                                  144,895          (221,916)
                                                                ---------         ---------
                      Total adjustments                          (602,021)          311,869
                                                                ---------         ---------

           Net cash provided by operating activities              265,306           330,083
                                                                ---------         ---------


CASH FLOWS FROM INVESTING ACTIVITIES:
      Purchase of property and equipment                         (107,685)         (213,086)
      Proceeds from sale of assets                                    -              10,575
                                                                ---------         ---------
           Net cash used in investing activities                 (107,685)         (202,511)
                                                                ---------         ---------
</TABLE>











The accompanying notes are an integral part of the financial statements.

                                      -15-
<PAGE>   16
<TABLE>
<CAPTION>

                                                             1997           1996
                                                           ---------      ---------
<S>                                                         <C>            <C>
CASH FLOWS FROM FINANCING ACTIVITIES:
     Proceeds from sale of common stock and exercise of
      stock options and warrants                             356,044         61,600
     Repayments on line of credit, net                      (316,133)      (142,892)
     Payments to former stockholder                           (8,000)        (8,002)
     Principal payments on debt                              (28,345)       (20,163)
     Payments on capital lease obligations                   (71,993)       (52,102)
                                                           ---------      ---------
          Net cash used in financing activities              (68,427)      (161,559)
                                                           ---------      ---------
          
          Net decrease in cash                                89,194        (33,987)

Cash - beginning of year                                     115,796        149,783
                                                           ---------      ---------

Cash - end of year                                         $ 204,990      $ 115,796
                                                           ---------      ---------


SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION:
     Cash paid during the year for:
          Interest                                         $  60,541      $  88,097
          Income taxes                                         5,836         10,000


SUPPLEMENTAL DISCLOSURE OF NONCASH PROPERTY
 AND EQUIPMENT ACTIVITIES:
     Capital lease obligations incurred for equipment      $  35,640      $  41,258
     Purchase of property and equipment with 
      seller-financing                                           -           85,275
</TABLE>


The accompanying notes are an integral part of the financial statements.

                                      -16-
<PAGE>   17
                                CABLE LINK, INC.

                          NOTES TO FINANCIAL STATEMENTS

                           December 31, 1997 and 1996

--------------------------------------------------------------------------------


NATURE AND SCOPE OF BUSINESS

   The Company sells new, used and refurbished cable TV equipment
   in addition to repairing equipment for cable companies within
   the United States and various international markets. The Company
   operates both its administrative and manufacturing operations
   from a single, leased facility in Columbus, Ohio.

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

   USE OF ESTIMATES

   The preparation of financial statements in conformity with
   generally accepted accounting principles requires management to
   make estimates and assumptions that affect the reported amounts
   of assets and liabilities, disclosure of contingent assets and
   liabilities at the date of the financial statements and the
   reported amounts of revenues and expenses during the reporting
   periods. Actual results could differ from these estimates.

   ACCOUNTS RECEIVABLE

   The Company utilizes the allowance method of accounting for accounts
   receivable and has provided for possible uncollectible amounts in the
   accompanying financial statements. The allowance for doubtful accounts was
   $20,360 and $40,360 for the years ended December 31, 1997 and 1996,
   respectively. Bad debt expense was $29,450 and $11,059 for the years ended
   December 31, 1997 and 1996, respectively.

   INVENTORIES

   
   Inventories consist of new and used cable TV equipment and parts 
   used to refurbish and repair cable TV equipment. Inventory is valued 
   at the lower of cost or market, using the average-cost method. New 
   and used inventory items are separately identified as items of 
   inventory. The weighted average cost is calculated per item of 
   inventory. Impairment and changes in market value are evaluated on 
   a per item basis.
    

   If the cost of the inventory exceeds the market value evaluation
   based on total inventory, provisions are made for the difference
   between the cost and the market value. Provision for potential
   obsolete or slow moving inventory is made based on analysis of
   inventory levels, changes in technology and future sales
   forecasts.

   PROPERTY AND EQUIPMENT

   Property and equipment are carried at cost, less accumulated
   depreciation computed using the straight-line method over the
   estimated useful lives of the related assets. Furniture,
   fixtures, and equipment are depreciated over lives ranging from
   three to seven years, and leasehold improvements are depreciated
   over the shorter of the lease term or useful life of the
   improvement, generally six to seven years. Major renewals and
   betterments are capitalized and depreciated; maintenance and
   repairs which neither improve nor extend the life of the
   respective assets are charged to expense as incurred. Upon
   disposal of assets, the cost and related accumulated
   depreciation are removed from the accounts and any gain or loss
   is included in income.



                                   (Continued)

                                      -17-
<PAGE>   18
                                CABLE LINK, INC.

                          NOTES TO FINANCIAL STATEMENTS

                           December 31, 1997 and 1996

--------------------------------------------------------------------------------


SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)

   PROPERTY AND EQUIPMENT (continued)

   The Company leases certain equipment under capital lease
   agreements with a cost and accumulated amortization of $254,156
   and $94,665 respectively, at December 31, 1997, and $218,516 and
   $54,182, respectively at December 31, 1996. Depreciation
   expense, which includes the amortization of assets held under
   capital leases, was $169,815 and $151,933 for 1997 and 1996,
   respectively.

   REVENUES

   
   Revenues are recognized when the related products are completed
   and shipped. Warranties are extended on new and repaired and
   refurbished products for periods up to one year. The Company's
   expense for such warranties is not significant. Warranties are not
   extended for used equipment.
    

   EARNINGS PER SHARE

   During 1997, the Company adopted Statement of Financial
   Accounting Standards (SFAS) No. 128 "Earnings Per Share." The
   new standard simplifies the standards for computing earnings per
   share and requires presentation of two new amounts, basic and
   diluted earnings per share. The Company was required to
   retroactively adopt this standard for both years presented.

<TABLE>
<CAPTION>

                                                          FOR THE YEAR ENDED
                                 -------------------------------------------------------------------------
                                          DECEMBER 31, 1997                      DECEMBER 31, 1996           
                                 -----------------------------------  ------------------------------------
                                    Income      Shares      Per Share   Income       Shares      Per Share
                                 (Numerator) (Denominator)    Amount  (Numerator) (Denominator)    Amount
                                 ----------- -----------------------  -----------------------------------
   BASIC EPS

<S>                               <C>          <C>           <C>       <C>         <C>           <C>     
   Income available to
     common stockholders          $867,327     1,591,976     $   0.54  $18,214     1,370,860     $   0.01

   Effect of Dilutive
     Securities, Warrants and
     Options                           -         321,982          .09      -          40,888       -
                                  --------     ---------     --------  -------     ---------     --------

   DILUTED EPS

   Income available to
     common stockholders          $867,327     1,913,958     $   0.45  $18,214     1,411,748     $   0.01
                                  ========     =========     ========  =======     =========     ========
</TABLE>


   Options to purchase 11,880 and 649,022 shares for the years
   ended December 31, 1997 and 1996, respectively were not included
   in the computation of diluted EPS because the options exercise
   price was greater than the average market price of common
   shares. In August, 1997, options to purchase 38,500 shares were
   issued contingent on certain earnings levels, and these options were
   not included in the computation of diluted EPS.

   Earnings per share is computed on the weighted average number of common
   shares outstanding including any dilutive options and warrants. Per share
   amounts have been restated for the effects of a three for two stock split and
   an eleven-for-ten stock dividend, that was effective January 31, 1997 and
   August 11, 1997 for stockholders of record as of January 21, 1997 and August
   1, 1997, respectively.

                                   (Continued)

                                      -18-
<PAGE>   19
                                CABLE LINK, INC.

                          NOTES TO FINANCIAL STATEMENTS

                           December 31, 1997 and 1996

--------------------------------------------------------------------------------
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)

   ADVERTISING

   The Company expenses advertising costs as incurred. Advertising
   expenses were $33,926 and $41,980 for the years ended December
   31, 1997 and 1996, respectively.

   STATEMENTS OF CASH FLOWS

   For the purpose of reporting cash flows, cash includes cash on
   hand and demand deposits held by banks.

   INCOME TAXES

   Deferred income taxes are recognized for the tax consequences in
   future years of differences between the financial reporting and
   tax bases of assets and liabilities at each year-end based on
   enacted tax laws and statutory tax rates. Valuation allowances
   are established when necessary to reduce deferred tax assets to
   the amount expected to be realized. Income tax expense
   represents the taxes currently payable and the net change during
   the period in deferred tax assets and liabilities.

   RECLASSIFICATIONS

   Certain reclassifications have been made to the 1996 financial
   statements to conform with the 1997 presentation.

CASH

    As of December 31, 1997, the Company had deposits in a bank
    which exceeded the federally insured limits.

INVENTORIES

     Inventories at December 31, 1997 and 1996 were as follows:

   
<TABLE>
<CAPTION>
                                1997            1996
          <S>                <C>             <C>
          PARTS:
                   USED              0               0
                   NEW         242,956         359,234
          CONVERTERS:
                   USED        449,550         218,800
                   NEW          21,350         164,900
          LINEGEAR:
                   USED        313,702         327,980
                   NEW         317,030          46,640

          HEAD-END:
                   USED         55,931         106,121
                   NEW           2,400           2,930
          TOTAL:
                   USED        819,183         652,901
                   NEW         583,736         573,704
          RESERVES             (70,300)        (50,296)
          NET INVENTORY      1,332,619       1,176,309
</TABLE>
    

     The Company reserves and periodically writes down slow moving
     inventory by category such as converters, linegear, parts, and
     headend.



                                   (Continued)

                                      -19-
<PAGE>   20
                                CABLE LINK, INC.

                          NOTES TO FINANCIAL STATEMENTS

                           December 31, 1997 and 1996

--------------------------------------------------------------------------------


REVOLVING CREDIT LINE

    The Company has a revolving credit line with a bank for the
    lesser of $850,000 or an amount based on eligible inventory and
    accounts receivable. The credit line is secured by substantially
    all assets of the Company and is payable on demand. The line
    matures on April 30, 1998, and interest is charged at prime plus
    1%.

LONG-TERM OBLIGATIONS

    Long-term obligations at December 31, 1997 and 1996 consists of the
    following:

<TABLE>
<CAPTION>

                                                                           1997          1996
                                                                        ---------      ---------
<S>                                                                     <C>            <C>      
        Amounts due under capital leases, net of $12,123
          and $19,453 representing interest at December 31,
          1997 and 1996, respectively                                   $  88,889      $ 125,242

        Non-interest bearing note payable to an entity
          relating to an equipment purchase due in
          monthly installments of $2,722 through June,
          1999.  The face amount of the note is $97,985
          and the effective interest rate is 9.25%.  The
          unamortized discount at December 31, 1997 and
          1996 was $3,417 and $9,009, respectively.  The
          note is secured by the related  equipment                        45,575         72,647

        Amount payable to stockholder                                       1,302          9,302

        Notes payable to a bank relating to motor vehicle purchases
          due in monthly installments of $342 with interest at
          8.75% were paid in full in 1997. The notes were secured
          by the motor vehicles.                                              -            1,274
                                                                        ---------      ---------


        Total                                                             135,766        208,465

        Less:  Current maturities                                         (82,354)      (101,703)
                                                                        ---------      ---------

        Long-term obligations                                           $  53,412      $ 106,762
                                                                        =========      =========
</TABLE>



                                   (Continued)

                                      -20-
<PAGE>   21



                                CABLE LINK, INC.

                          NOTES TO FINANCIAL STATEMENTS

                           December 31, 1997 and 1996

--------------------------------------------------------------------------------


LONG-TERM OBLIGATIONS (continued)

    Maturities of long-term obligations are as follows:

<TABLE>
<CAPTION>

                                                          Long-term       Capital Lease
                                                         Obligations       Obligations
                                                         -----------       -----------

             <S>                                            <C>               <C>    
                               1998                         $29,684           $58,792
                               1999                          17,193            25,007
                               2000                              -             16,815
                               2001                              -                398
                               2002                              -                 -
                                                            -------           -------
                                                                              101,012
             Less amount representing interest                   -             12,123
                                                            -------           -------

                               Total                        $46,877           $88,889
                                                            =======           =======

</TABLE>

RETIREMENT PLANS

    The Company began a 401(K) retirement plan for the benefit of its employees
    during 1997. The employees must have attained age 21 and completed at least
    one year of service to be eligible. The Company's contribution is
    discretionary and was $5,000 in 1997. The total employee contributions for
    1997 were $42,687.

INCOME TAXES

    The provision for income taxes consists of the following:

<TABLE>
<CAPTION>

                                                                   1997         1996
                                                                 --------     --------
<S>                                                              <C>          <C>      
                     Current (benefit) expense

                           Federal                               $210,000     $ (7,826)
                           State and local                         36,049       (9,802)
                                                                 --------     --------

                                Income tax (benefit) expense     $246,049     $(17,628)
                                                                 ========     ========
</TABLE>



                                   (Continued)

                                      -21-
<PAGE>   22
                                CABLE LINK, INC.

                          NOTES TO FINANCIAL STATEMENTS

                           December 31, 1997 and 1996

--------------------------------------------------------------------------------


INCOME TAXES (continued)

    The components of the net deferred tax asset (liability) are as follows:

<TABLE>
<CAPTION>

                                                                         1997           1996
                                                                       --------      ---------

                     Assets:
<S>                                                                    <C>           <C>      
                           Accounts receivable                         $  7,737      $  15,337
                           Inventories                                   49,983         46,660
                           Accrued franchise tax                          6,460            -
                           Net operating loss                               -          174,133
                           Other                                          4,659          3,811
                                                                       --------      ---------
                                Gross deferred tax assets                68,839        239,941
                                                                       --------      ---------

                     Liability:
                           Property and equipment                        52,616         35,603
                           Prepaid asset                                 27,723         17,387
                                                                       --------      ---------
                                Gross deferred tax liabilities           80,339         52,990
                                                                       --------      ---------

                                Net deferred tax asset (liability)      (11,500)       186,951
                                Less: Valuation allowance                   -         (186,951)
                                                                       --------      ---------

                                                                       $(11,500)     $     -
                                                                       ========      =========
</TABLE>

    A reconciliation of the Company's effective tax values is as follows:

<TABLE>
<CAPTION>

                                                                          1997           1996
                                                                        ---------      --------

<S>                                                                     <C>            <C>     
                     Income tax at statutory rates                      $ 382,458      $    200
                     State and local taxes, net of federal benefit         43,431        (6,469)
                     Surtax and other rate differences                      2,214         5,298
                     Permanent differences                                 15,591         6,092
                     Change in valuation allowance                       (186,951)      (22,749)
                     State tax credits earned                               3,257           -
                     Refunds from prior years state returns, net of
                       federal tax                                         (2,451)          -
                                                                        ---------      --------

                                                                        $ 257,549      $(17,628)
                                                                        =========      ========
</TABLE>

    The net deferred tax assets were fully reserved for the year ended December
    31, 1996, as it was not known if the benefit would have been realized by the
    Company. The reserve was reversed in 1997.

    As of December 31, 1996, the Company had approximately $458,000 of tax net
    operating loss carry forwards remaining to be utilized. The Company utilized
    the entire net operating loss in 1997.



                                   (Continued)

                                      -22-
<PAGE>   23
                                CABLE LINK, INC.

                          NOTES TO FINANCIAL STATEMENTS

                           December 31, 1997 and 1996

--------------------------------------------------------------------------------


STOCKHOLDERS' EQUITY

    At December 31, 1997 and 1996, the Company had authorized common shares, no
    par value, of 10,000,000 and 1,800,000, respectively, and authorized
    preferred shares, no par value, of 200,000. No preferred stock is issued or
    outstanding at December 31, 1997 or 1996.

   
    The Company adopted the 1995 Stock Option Plan ("1995 Plan") effective
    October 17, 1995. The 1995 Plan authorizes the Company to grant options
    ("Options") to purchase shares of the Company's common stock to directors,
    employees and consultants of the Company. The 1995 Plan also authorizes the
    Company to grant stock appreciation rights ("SARs") to employees of the
    Company. The maximum number of common shares that may be issued under the
    1995 Plan is 395,010. An SAR may be issued, at the discretion of the Board
    of Directors, either in tandem or not in tandem with an Option. The holder
    of an SAR tandem to an Option is entitled to receive, upon exercise of the
    SAR, payment of an amount determined by multiplying the excess of fair
    market value of a common share on the date the SAR is exercised over the
    exercise price of the related Option by the number of shares as to which the
    SAR has been exercised. The Board of Directors shall determine the exercise
    price of each SAR that is not in tandem with an Option at the time of
    granting the SAR, but in no event shall the exercise price be less than the
    fair market value of a common share on the date such SAR is granted. The
    exercise of an SAR tandem to an Option shall cancel the related Option with
    respect to the number of shares as to which such SAR is exercised. The
    exercise of an Option granted in tandem with an SAR shall cancel the related
    SAR with respect to the number of shares as to which such Option is
    exercised. At the discretion of the Board of Directors, payment upon the
    exercise of an SAR may be made in cash, shares of the Company's common stock
    or any combination thereof. All options granted during 1996 and 1995 were
    granted in tandem with SARS for an identical number of common shares.

    The Company applies Accounting Principles Board Opinion No. 25 and related
    interpretations in accounting for its stock option plan. The vesting period
    of the options granted range from immediately exercisable to four years.
    Accordingly, no compensation cost has been recognized in the accompanying
    financial statements for options or SARs issued under the plan since the
    exercise price of the options and SARs was equal to the market value of the
    shares at the date of grant. Had compensation cost for the Company's stock
    option plan been determined based on the fair value at the grant dates for
    awards under the plan consistent with the methodology of Financial
    Accounting Standards Board Statement No. 123 "Accounting for Stock- Based
    Compensation," the Company's net income (loss) and net income (loss) per
    share would change as indicated below:
    

<TABLE>
<CAPTION>

                                                              1997         1996
                                                            --------     ------- 

<S>                                                         <C>          <C>     
                     Net income (loss):
                          As reported                       $867,327     $ 18,214
                          Pro forma                          825,136      (21,524)
                                                                       
                     Basic earnings (loss) per share:                  
                          As reported                       $   0.54     $   0.01
                          Pro forma                             0.52        (0.02)
                                                                       
                     Diluted earnings (loss) per share:                
                          As reported                       $   0.45     $   0.01
                          Pro forma                         $   0.43     $  (0.02)
                                                                    
</TABLE>

    The fair value of each option grant is estimated on the date of grant using
    the Black-Scholes option-pricing model with the following weighted-average
    assumptions used for grants in 1997 and 1996.

<TABLE>
<CAPTION>

                                                              1997                             1996
                                                      --------------------------         ---------------------------

<S>                                                   <C>                                <C>
                       Dividend yield                 0                                  0
                       Expected volatility            112%                               574%
                       Risk-free interest rates       5.89%, 5.92%, 5.96% & 6.25%        5.72%, 5.82%, 6.32% & 6.58%
                       Expected lives                 5, 4 and 1 years                   5, 4 and 1 years
</TABLE>


                                   (Continued)

                                      -23-
<PAGE>   24
                                CABLE LINK, INC.

                          NOTES TO FINANCIAL STATEMENTS

                           December 31, 1997 and 1996

--------------------------------------------------------------------------------



STOCKHOLDERS' EQUITY (continued)

    A summary of the status of the Company's employee stock option plan as of
    December 31, 1997 and 1996 and changes for the years then ended is presented
    below:

   
<TABLE>
<CAPTION>

                                               1997                                      1996
                                   ----------------------------          -------------------------------------

                                                     Weighted-                                    Weighted-
                                                      Average                                      Average
                                    Shares        Exercise Price            Shares             Exercise Price
                                    ------        --------------            ------             --------------
<S>                                 <C>               <C>                   <C>                     <C>  
January 1                           210,342           $1.53                 217,998                 $1.37
Granted                              53,350            2.53                 138,270                  1.40
Exercised                                -               -                  (17,028)                 1.77
Canceled                            (27,390)           1.66                (126,918)                 1.05
                                   --------                                --------
December 31                         236,302            1.82                 212,322                  1.53
                                   ========                                ========

Options exercisable
  at year-end                       130,276                                  94,644

Weighted-average
  fair value of options
  granted during the
  year                              $  1.93                                 $  1.33
</TABLE>
    


    The following table summarizes information about employee stock options at
    December 31, 1997

<TABLE>
<CAPTION>

                                                     Weighted-
                                                     Average
                                Number               Remaining           Weighted-      Number          Weighted-
                             Outstanding            Contractual           Average      Exercisable       Average
     Range of                 December 31,            Life               Exercise      December 31,     Exercise
Exercise Prices                1997               (  In Years  )          Price           1996           Price
---------------         ------------------        --------------      ------------     -------------    ---------

<S>                           <C>                      <C>                <C>             <C>              <C>  
$0.79 - $3.50                 236,302                  6.87               $1.80           130,276          $1.72
</TABLE>


   
    Prior to 1997, the Company had agreements to issue warrants to purchase
    common stock and stock options to a director of the Company in exchange for
    consulting services. In connection with these agreements, the Company paid
    consulting fees of $100,000 in 1996, and issued options to purchase 33,000
    shares at $0.72 per share in 1996. The warrants and options include
    provisions allowing the director to require the Company to repurchase the
    warrants and options for the difference between the exercise price and the
    fair market value at the date the director notifies the Company. No
    compensation expense was recorded since the exercise price of the warrants
    was equal to the market price of the shares at the date of grant. On
    December 13, 1995, the Board amended the consulting agreement to extend the
    expiration date until May 31, 2004. No compensation expense was recorded
    since the exercise price of the warrant and options was in excess of the
    market price of the shares at the date of the extension. In 1997, the
    director became an employee of the Company.
    


                                   (Continued)

                                      -24-
<PAGE>   25
                                CABLE LINK, INC.

                          NOTES TO FINANCIAL STATEMENTS

                           December 31, 1997 and 1996

--------------------------------------------------------------------------------




STOCKHOLDERS' EQUITY (continued)

    Following is a summary of the director's options, substantially all of which
    are fully vested:

<TABLE>
<CAPTION>

                                      Weighted Average
                                  Shares         Exercise Price
                                  ------         --------------
<S>                              <C>             <C> 
     January 1, 1996              366,300          $   1.71

     Granted during 1996           34,980              0.88
                                 --------

     December 31, 1996            401,280          $   1.64
                                 ========
</TABLE>

   
    The stock options and SARs expire at various dates through 2006. No new
    options were granted under these agreements in 1997.
    

    At December 31, 1997 and 1996, the director held warrants to purchase 19,800
    shares of stock for $0.93 per share. The warrants expire in 2004.

    At December 31, 1997 and 1996, outside Board of Directors members held
    options to purchase 40,040 and 100,980 shares of common stock, respectively,
    with exercise prices ranging from $0.79 to $3.50. At December 31, 1997 and
    1996, 40,040 and 97,020 of the options are vested and the options expire at
    various dates through 2007.

OPERATING LEASE OBLIGATIONS

    The Company leases production and office space from a former director of the
    Company under an operating lease expiring in October, 1998 with a three-year
    renewal option. During 1997 and 1996, modifications were made to the lease
    which increased the Company's occupancy area and monthly rent. At December
    31, 1997, monthly payments of $11,827 were required, subject to increases in
    real estate taxes and rent increases each November. Minimum lease payments
    due in 1998 are $118,265.

    Rent expense was $139,295 and $135,449 for the years ended December 31, 1997
    and 1996, respectively. The Company leases a vehicle and various office
    equipment. The lease expense was $26,593 and $17,564 for the years ended
    December 31, 1997 and 1996, respectively.

   
RECONCILIATION WITH VENDORS

    During 1997 and 1996, the Company reconciled amounts owed to various
    vendors. These reconciliations resulted in a reduction of expenses of
    $112,197 and $93,518 in 1997 and 1996, respectively.
    



                                   (Continued)

                                      -25-
<PAGE>   26
                                CABLE LINK, INC.

                          NOTES TO FINANCIAL STATEMENTS

                           December 31, 1997 and 1996

--------------------------------------------------------------------------------

STOCKHOLDER TRANSACTIONS

    On October 18, 1994, the Company's former president and largest stockholder
    entered into an agreement, with a director, whereby the director would
    purchase from the former president 581,636 common shares. The disinterested
    stockholders of the Company approved the transaction on December 28, 1994.
    In addition, the director entered into a participation agreement whereby
    directors and third parties will acquire 25% of shares purchased pursuant to
    the Agreement. Effective December 31, 1996, the share purchase transaction
    was completed.

    Under terms of the agreement, the Company entered into a separation,
    noncompetition and consulting agreement with the former president. The
    Separation Agreement requires the Company to pay the former president
    $100,000. Consulting services are to be provided by the former president
    through December 31, 1998, for total consideration of $350,000 payable in
    seven monthly installments of approximately $15,394; 25 monthly installments
    of approximately $9,333; and a final installment of $8,917. The former
    president also agreed not to compete with the Company through December 31,
    1998, for total consideration of $25,000 payable in seven monthly
    installments of approximately $1,100; 25 monthly installments of
    approximately $667; and a final installment of $625. The covenant not to
    compete and the related obligation are reflected in the accompanying balance
    sheets, and the covenant is being amortized on the straight-line method over
    the term of the covenant. Total accumulated amortization in relation to the
    covenant not-to-compete was $16,765 and $11,981 for 1997 and 1996,
    respectively. The consulting services are being expensed over the term of
    the Agreement as services are rendered. Under this agreement, the Company
    recognized expenses of $84,000 per year in 1997 and 1996.

    The annual payment due under these agreements is $19,547 for 1998.

CONCENTRATIONS OF CREDIT RISK

    The Company grants credit to cable operations in the United States, Central
    and South America, Europe and the Pacific Rim. Sales are denominated
    principally in U. S. dollars and, therefore, the Company does not have
    significant foreign exchange rate risk. Sales to customers outside the
    United States were $1,135,483 and $1,071,250 and the corresponding accounts
    receivable were $28,636 and $106,223 at December 31, 1997 and 1996,
    respectively. In most cases, sales of product in international markets are
    cash in advance or cash on delivery. Additionally, the Company carries
    insurance on all significant international accounts receivable.

    At December 31, 1996, approximately 14% of the accounts receivable balance
    was due from one customer. At December 31, 1997 there were no balances due
    from any one customer over 10%.

                                      -26-
<PAGE>   27
MANAGEMENT'S DISCUSSION AND ANALYSIS

Result of Operations

Net sales

Net sales for 1997 were $10,094,178 compared to $8,248,814 for 1996. This
represents an increase of 22% or $1,845,364 over the previous year. Sales to
customers outside the United States increased 6% during 1997. The total increase
in sales is primarily due to an expanded customer base and an increase in the
Company's repair and refurbishing business.

Cost of goods sold

The cost of goods sold decreased to 62.2% of sales in 1997 compared to 68.0% for
1996. The majority of the reduction in cost of goods sold is production labor
expenses. The production labor costs declined in 1997 as a percent of sales to
13.9% from 20.1% in comparison to 1996. This decrease in labor cost is primarily
the result of a reduction in labor force as well as increased efficiencies and
new procedures that have led to improved productivity of employees.

General and Administration expenses

   
The general and administration expenses decreased to 27.2% of sales in 1997 from
32.1% for 1996. The decrease was due to a reduction in administrative personnel.
Job procedures were implemented which increased the efficiencies and reduced
costs.
    

Income from operations

   
Income from operations increased to $1,070,396 or 10.6% of sales in 1997
compared to $(13,485) or (0.1%) of sales for 1996. The Company's increased
profitability in 1997 has exhausted all net operating loss carryforward that was
generated from prior years. For 1997 the Company has expensed $246,049 for
federal, state and local taxes. As a result of a 22% increase in sales and
improved gross profit margin, as well as reduced costs, the Company has
generated net income of $867,327 or 8.6% of sales in 1997 as compared to $18,214
or 0.2% of sales for 1996. The basic earnings per share in 1997 was $0.54
compared to $0.01 for 1996.

Other income and expense increased by .5% of sales in 1997 from .2% of sales in
1996 due to an increase in other income as a result of reconciliation with
vendors. This reflects adjustments for inventory items that were later found to
be defective, undelivered or otherwise unacceptable and the related interest on
over-due accounts. This adjustment is non-recurring and no such adjustment is
anticipated in 1998.
    


                                      -27-
<PAGE>   28
Liquidity and Capital Resources

   
The Company finances its operations primarily through internally generated funds
and the bank line of credit. Bank borrowings decreased which resulted in lower
interest expense of $23,571 between 1997 and 1996. As a result of strong fourth
quarter sales, accounts receivable increased $399,044 (54%) over the December
31, 1996 balance. As a result of improved cash flow, accounts payable decreased
$548,075. Accrued expenses increased $150,797 due to income taxes and bonuses.
Property and equipment purchases decreased in 1997 compared to 1996. The
increase in accounts receivable and decrease in accounts payable caused net cash
from operating activities to decrease by $64,777.
    

The Company declared a three for two stock split effective January 31, 1997 and
an eleven for ten stock dividend on August 11, 1997.

On January 8, 1997, the Company entered into an agreement with another entity
(the Buyer) to purchase 165,000 shares of common stock and warrants to purchase
additional 165,000 shares of common stock for $200,000. During 1997 the Company
has sold 165,000 shares and warrants to purchase 122,000 shares were exercised
for a total net proceed of $356,044.

The Company began a 401(K)-retirement plan for the benefit of its employees
during 1997. The Company contribution is discretionary, and was $5,000 in 1997.

The company believes that its available financial resources are adequate to meet
its foreseeable working capital, debt service and capital expenditure
requirements.

Addressing Year 2000 Issues

The Company is in the process of addressing the "Year 2000" issue. An upgraded
version of Macola (accounting software) has been purchased. The upgrade to
Macola was purchased in December 1997 as an enhancement to the existing software
that was installed in March of 1996. This version is Year 2000 compliant. The
Company is currently contacting major vendors regarding their Year 2000
capabilities. Management is currently evaluating the test equipment for any Year
2000 concerns.

New Accounting Pronouncements

In 1998, the Company will adopt Statement of Financial Accounting Standard
(SFAS) No. 130 "Reporting Comprehensive Income" by reporting and displaying
comprehensive income and its components within its financial statements. In
1998, the Company will determine if the Company meets the conditions for
adoption of SFAS No. 131 "Disclosures about Segments of an Enterprise and
Related Information". SFAS No. 131 requires that a public business enterprise
report financial and descriptive information about its reportable operating
segments. Currently, the Company does not believe it meets the criteria to
require additional disclosure.

                                      -28-
<PAGE>   29
                                   SIGNATURES

   
         In accordance with Section 13 or 15(d) of the Securities Exchange Act
of 1934, the registrant has duly caused this amended report to be signed on its
behalf by the undersigned thereunto duly authorized.

Dated: December 9, 1998
    

                          CABLELINK, INC.
                          (the "Registrant")



                          By: /s/ Bob Binsky                  
                              ---------------------------------
                              Bob Binsky, Chairman of the Board


   
        In accordance with the Exchange Act, this report has been signed below
by the following persons on behalf of the registrant and in the capacities and
on the 9th day of December, 1998.
    


   SIGNATURE                       TITLE
/s/ Bob Binsky
--------------------     Director, Chairman of the Board,
   Bob Binsky            Chief Executive Officer
                         (principal executive officer)

Zaida Wahlberg*          Treasurer (principal accounting
--------------------     officer)
   Zaida Wahlberg

Brenda L. Thompson*      President and Director
--------------------
 Brenda L. Thompson

   
    

Eric S. Newman*          Director
--------------------
   Eric S. Newman

Sherry J. Rothfield*     Director
--------------------
 Sherry J. Rothfield

Michael Tsao*            Director
--------------------
   Michael Tsao

     *By: /s/ Bob Binsky
         ----------------------------
          Bob Binsky, Attorney-in-fact


                                      -29-