8-K/A

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 8-K/A

CURRENT REPORT

Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

Date of Report (Date of earliest event reported): March 28, 2008

COMMISSION FILE NUMBER 0-22636

RAPID LINK, INCORPORATED

(Exact name of Registrant as specified in its charter)

DELAWARE	75-2461665
(State or other jurisdiction of  incorporation or organization)	(I.R.S. Employer Identification No.)

5408 N. 99th Street; Omaha, NE   68134

(Address of principal executive offices)

(402) 392-7561

(Issuer’s telephone number)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

¨ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

¨ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 230.14a-12)

¨ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

¨ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Item 2.01 Completion of Acquisition or Disposition of Assets

On March 28, 2008, Rapid Link, Incorporated completed the acquisition of One Ring Networks Inc. pursuant to the terms of the original stock purchase agreement dated March 28, 2008.

We hereby amend Item 9.01 of our current report on Form 8-K filed on March 28, 2008 to include financial statements of the business acquired and pro forma information in accordance with 9.01(a).  Except as set forth in item 9.01 below, no other changes are being made to our current report on Form 8-K filed on March 28, 2008.

Item 9.01 Financial Statements and Exhibits

(a) Financial Statements of Business Acquired.

The financial statements of One Ring Networks, Inc. required to be filed pursuant to item 9.01(a) of Form 8-K are attached hereto as Exhibit 99.1.

(b) Unaudited Pro Forma Financial Information.

The unaudited pro forma financial information required to be filed pursuant to item 9.01(b) of Form 8-K is attached hereto as Exhibit 99.2.

(c) Exhibits.

Exhibit Number	Description
99.1	Financial Statements of One Ring Networks, Inc.
99.2	Unaudited Pro Forma Financial Information

SIGNATURES

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

Rapid Link, Incorporated

Date: June 23, 2008	/s/ John A. Jenkins
	John A. Jenkins
	Chief Executive Officer and Chairman of the Board

EX-99.1

EXHIBIT 99.1

FINANCIAL STATEMENTS AND

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

ONE RING NETWORKS, INC.

December 31, 2007 and 2006

ONE RING NETWORKS, INC.

INDEX

	Page
Report of Independent Registered Public Accounting Firm	3
Financial Statements
Balance Sheets.	4
Statements of Operations	5
Statements of Changes in Stockholders’ Equity (Deficit)	6
Statements of Cash Flows	7
Notes to Financial Statements	9

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

To the Stockholders of

One Ring Networks, Inc.

We have audited the accompanying balance sheets of One Ring Networks, Inc. (the “Company”) as of December 31, 2007 and 2006 and the related statements of operations, changes in stockholders’ equity (deficit) and cash flows for the years then ended.  These financial statements are the responsibility of the Company’s management.  Our responsibility is to express an opinion on these financial statements based on our audits.

We conducted our audits in accordance with the standards of the Pubic Company Accounting Oversight Board (United States).  Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement.  The Company is not required to have, nor were we engaged to perform an audit of its internal control over financial reporting.  Our audits included consideration of internal control over financial reporting as a basis for designing audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Company’s internal control financial over financial reporting.  Accordingly, we express no such opinion.  An audit also includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements and 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 One Ring Networks, Inc. as of December 31, 2007 and 2006, and the results of its operations and its cash flows for the years then ended in conformity with accounting principles generally accepted in the United States of America.

As described in Note 1, the accompanying financial statements have been prepared assuming that the Company will continue as a going concern.  The Company has experienced recurring losses, has generated recurring negative cash flows from operations and has liabilities significantly in excess of assets at December 31, 2007.  These conditions raise substantial doubt about the Company’s ability to continue as a going concern.  Management’s plan with regard to these matters is also described in Note 1.  The financial statements do not include any adjustments that might result from the outcome of this uncertainty.

/s/ KBA GROUP LLP

KBA Group LLP

Dallas, Texas

June 23, 2008

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ONE RING NETWORKS, INC.

BALANCE SHEETS

ASSETS
	March 31,			December 31,
	2008			2007			2006
	(unaudited)
Current assets
Cash and cash equivalents	$			$	80,191		$	111,023
Accounts receivable, net of allowance for doubtful accounts of $71,246, $59,332 and $68,470, respectively		172,626			84,440			103,962
Prepaid expenses and other current assets		35,200			49,442			8,667
Total current assets		233,221			214,073			223,652
Property and equipment, net		853,139			966,862			771,245
Deposits		67,306			35,252			-
Total assets	$	1,153,666		$	1,216,187		$	994,897
LIABILITIES AND STOCKHOLDERS’ EQUITY (DEFICIT)
Current liabilities
Accounts payable	$	243,694		$	200,439		$	155,131
Accrued liabilities		36,411			139,863			109,414
Deferred revenue		34,000			103,167			61,276
Amount due to Rapid Link		130,000			-			-
Note payable due to related party		-			90,000			90,000
Convertible debt due to related parties		-			1,000,140			650,140
Current portion of notes payable		9,578			9,054			6,079
Current portion of capital lease obligations		298,640			358,445			124,171
Total current liabilities		752,323			1,901,108			1,196,211
Notes payable, net of current portion		24,450			27,216			17,686
Capital lease obligations, net of current portion		81,125			111,643			75,644
Total liabilities		857,898			2,039,967			1,289,541
Commitments and contingencies
Stockholders’ equity (deficit)
Common stock – par value $.01 per share; 30,000,000, 10,000,000 and 10,000,000 shares authorized, respectively; 12,236,214, 7,862,457 and 7,354,631 shares issued and outstanding, respectively		122,326			78,625			73,546
Additional paid-in capital		3,540,952			2,055,869			1,271,905
Accumulated deficit		(3,367,510	)		(2,958,274	)		(1,640,095	)
Total stockholders’ equity (deficit)		295,768			(823,780	)		(294,644	)
Total liabilities and stockholders’ equity (deficit)	$	1,153,666		$	1,216,187		$	994,897

The accompanying notes are an integral part of these financial statements

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ONE RING NETWORKS, INC.

STATEMENTS OF OPERATONS

	Three Months Ended March 31,						Year Ended December 31,
	2008			2007			2007			2006
	(unaudited)			(unaudited)
Revenues	$	325,092		$	302,280		$	1,082,960		$	778,213
Cost and expenses
Cost of services		252,010			298,681			674,486			582,425
Sales and marketing expenses		24,387			15,006			53,903			17,497
General and administrative expenses		295,303			229,694			1,197,323			1,119,607
Depreciation and amortization		179,017			56,124			397,963			116,926
Total costs and expenses		750,717			599,505			2,323,675			1,836,455
Operating loss		(425,625	)		(297,225	)		(1,240,715	)		(1,058,242	)
Other income (expense)
Interest expense		(4,384	)		(959	)		(42,740	)		(22,679	)
Related party interest expense		(12,005	)		(4,475	)		(48,587	)		(17,944	)
Interest income		-			-			13,863			3,942
Net loss	$	(409,236	)	$	(291,791	)	$	(1,318,179	)	$	(1,094,384	)

The accompanying notes are an integral part of these financial statements

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ONE RING NETWORKS, INC.

STATEMENTS OF CHANGES IN STOCKHOLDERS’ EQUITY (DEFICIT)

	Common Stock						Additional Paid-in		Accumulated
	Shares			Amount			Capital		Deficit			Total
Balance at December 31, 2005		6,404,410		$	64,044		$	718,418	$	(545,711	)	$	236,751
Issuance of common stock for cash		950,221			9,502			553,487		-			562,989
Net loss		-			-			-		(1,094,384	)		(1,094,384	)
Balance at December 31, 2006		7,354,631			73,546			1,271,905		(1,640,095	)		(294,644	)
Issuance of common stock for cash		84,467			845			27,719		-			28,564
Issuance of common stock for services		350,000			3,500			119,000		-			122,500
Issuance of common stock for conversion of debt due to related parties		1,857,143			18,571			631,429		-			650,000
Repurchase and cancellation of common stock		(1,783,784	)		(17,838	)		5,816		-			(12,021	)
Net loss		-			-			-		(1,318,179	)		(1,318,179	)
Balance at December 31, 2007		7,862,457		$	78,625		$	2,055,869	$	(2,958,274	)	$	(823,780	)

The accompanying notes are an integral part of these financial statements

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ONE RING NETWORKS, INC.

STATEMENTS OF CASH FLOWS

	Three Months Ended March 31,						Year Ended December 31,
	2008			2007			2007			2006
	(unaudited)			(unaudited)
Cash flows from operating activities
Net loss	$	(409,236	)	$	(291,791	)	$	(1,318,179	)	$	(1,094,384	)
Adjustments to reconcile net loss to net cash used in operating activities
Depreciation and amortization		179,017			56,124			397,963			116,926
Provision for doubtful accounts		-			24,000			123,912			68,470
Stock-based compensation		-			-			122,500			-
Changes in assets and liabilities:
Accounts receivable		(88,186	)		(48,600	)		(104,390	)		(127,217	)
Prepaid expenses and other current assets		14,242			(2,485	)		(40,775	)		(2,453	)
Deposits		(32,054	)		-			(35,252	)		-
Accounts payable		43,255			50,329			(45,308	)		(92,577	)
Accrued liabilities		(28,452	)		(2,511	)		30,449			81,987
Deferred revenue		69,167			9,175			41,891			31,619
Net cash used in operating activities		(390,581	)		(205,759	)		(736,573	)		(1,012,723	)
Cash flows from investing activities Purchases of property and equipment		(65,294	)		-			(15,269	)		(343,677	)
Cash flows from financing activities
Proceeds from issuance of common stock		268,601			18,564			28,564			562,989
Repurchase of common stock		-			-			(12,021	)		-
Proceeds from convertible debt due to related parties		95,043			257,000			1,025,000			650,000
Payments on capital lease obligations		(90,323	)		(31,923	)		(289,453	)		(52,993	)
Payments on notes payable		(2,242	)		(1,455	)		(6,080	)		(5,334	)
Payments on convertible debt due to related parties		-			-			(25,000	)		(10,000	)
Advances from Rapid Link		130,000			-			-			-
Net cash provided by financing activities		401,079			242,186			721,010			1,144,662
Net increase (decrease) in cash and cash equivalents		(54,796	)		36,427			(30,382	)		(211,738	)
Cash and cash equivalents at beginning of period		80,191			111,023			111,023			322,761
Cash and cash equivalents at end of period	$	25,395		$	147,450		$	80,191		$	111,023
Supplemental disclosure of cash flow information
Cash paid for interest	$	-		$	5,434		$	26,470		$	11,496
Supplemental schedule of non-cash investing and financing activities
Property and equipment acquired with capital leases	$	-		$	-		$	559,726		$	134,670

The accompanying notes are an integral part of these financial statements

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ONE RING NETWORKS, INC.

STATEMENTS OF CASH FLOWS

Property and equipment acquired with notes payable	$	-	$	-	$	18,585	$	29,099
Issuance of common stock in exchange for conversion of convertible debt due to  related parties	$	1,260,183	$	-	$	650,000	$	-

The accompanying notes are an integral part of these financial statements

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ONE RING NETWORKS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

NOTE 1.  NATURE OF BUSINESS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Description of the Company

One Ring Networks, Inc. (the “Company”) was founded in September 1999 as a Georgia S corporation.  The Company provides a variety of data access and telecommunications services to small to medium-sized businesses located throughout the United States primarily for the high-speed transmission of voice and data traffic and other communications services.  The Company is located in Atlanta, Georgia.

Going Concern

During the years ended December 31, 2007 and 2006, the Company incurred net losses of $1,318,179 and $1,094,384, respectively.  Additionally, at December 31, 2007 the Company’s current liabilities of $1,901,108 significantly exceed current assets of $214,073.  These matters raise substantial doubt about the Company’s ability to continue as a going concern.  The accompanying financial statements do not include any adjustments that might result from the outcome of this uncertainty.

As discussed in Note 10, in March of 2008, 100% of the stock of the Company was sold to Rapid Link Incorporated (“Rapid Link”). Management believes that cash from the consolidated operations of Rapid Link and additional committed funding from lenders will be sufficient to fund operations for at least the next twelve months.  Funding needs of Rapid Link have historically been provided by operations and proceeds from debt and equity funding.  However, there can be no assurance that such funds will be available in the future.

Unaudited Interim Information

The interim financial statements of the Company included in these audited financial statements are unaudited and do not include all of the information and footnotes required by generally accepted accounting principles for complete financial statements.  In the opinion of management, all adjustments consisting of normal recurring adjustments considered necessary for a fair presentation of the financial position and operating results for the three month periods ended March 31, 2008 and 2007 have been included.  Operating results for the three month period ended March 31, 2008 are not necessarily indicative of the results that may be expected for the fiscal year ending December 31, 2008.

Management Estimates

The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and results of operations.  These estimates are based on historical experience and information that is available to management about current events and actions the Company may take in the future.  Actual results could differ from these estimates.

Fair Value of Financial Instruments

The Company's financial instruments consist of cash and cash equivalents, accounts receivable, accounts payable, and notes payable. The Company believes the reported carrying amounts of its cash and cash equivalents, accounts receivable, and accounts payable approximates fair value, based upon the short-term nature of those instruments. The Company believes that the carrying value of its notes payable approximates the fair value based on the terms and conditions the Company believes could be attained from other lenders.

Cash and Cash Equivalents

The Company considers all highly liquid investments with original maturities of three months or less to be cash equivalents.

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ONE RING NETWORKS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Accounts Receivable

Accounts receivable represent amounts due from customers and are stated at the amount the Company expects to collect.  The Company generally does not require collateral from its customers.  The Company maintains allowances for doubtful accounts for estimated losses resulting from the inability of its customers to make required payments.  Management considers the following factors when determining the probability of collecting specific customer accounts:  customer credit-worthiness, past transaction history with the customer, current economic industry trends, and changes in customer payment terms.  If the financial condition of the Company’s customers were to deteriorate, adversely affecting their ability to make payments, additional allowances would be required.

Based on management’s assessment, the Company provides for estimated uncollectible amounts through a charge to earnings and a credit to a valuation allowance.  Balances that remain outstanding after the Company has used reasonable collection efforts are written off through a charge to the valuation allowance and a credit to accounts receivable.

Property and Equipment

Property and equipment are stated at cost less accumulated depreciation and amortization.  Equipment under capital leases is recorded at the present value of future minimum lease payments.  Depreciation and amortization is computed using the straight-line method over the estimated useful lives of the assets ranging from 3 to 7 years.  Property and equipment held under capital leases and leasehold improvements are amortized on a straight-line basis over the shorter of the estimated useful life of the asset or the remaining term of the respective lease.

Expenditures for major renewals and betterments that extend the useful lives of property and equipment are capitalized.  Expenditures for maintenance and repairs are charged to expense as incurred.

Long-Lived Assets

Long-lived assets, including property and equipment, are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of the assets might not be recoverable.  The Company does not perform a periodic assessment of assets for impairment in the absence of such information or indicators.  Conditions that would necessitate an impairment include a significant decline in the observable market value of an asset, a significant change in the extent or manner in which an asset is used, or a significant adverse change that would indicate that the carrying amount of an asset or group of assets is not recoverable.  For long-lived assets to be held and used, the Company recognizes an impairment loss only if an impairment is indicated by its carrying value not being recoverable through undiscounted cash flows.  The impairment loss is the difference between the carrying amount and the fair value of the asset estimated using discounted cash flows.

Revenue Recognition

The Company provides wireless network services under contractual agreements with its customers.  The contractual agreements generally include multiple-element arrangements for the provision of wireless communication services and for the installation and activation of necessary equipment.  The Company has determined that its multiple-element arrangements that qualify as separate units of accounting are: (1) services and (2) installation and activation. In accordance with Emerging Issues Taskforce (“EITF”) Issue No. 00-21, Accounting for Revenue Arrangements with Multiple Deliverables, the Company allocates consideration to each unit of accounting based on relative fair values.  Revenue from services is generally recognized monthly as the service is rendered.  Revenue related to installation and activation charges is recognized ratably over the expected life of the customer relationship.  The Company also generates revenues from the sale of equipment which is recognized at the time of shipment to the customer.  Reserves for estimated credits and allowances are recorded in the same period as the related revenues.  The Company records any payments received in advance of earning revenue as deferred revenue until all revenue recognition criteria have been met.

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ONE RING NETWORKS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Stock-Based Compensation

Prior to January 1, 2006, the Company accounted for equity instruments issued to employees using the intrinsic value method in accordance with Accounting Principles Board Opinion No. 25.

Effective January 1, 2006, the Company accounts for equity instruments issued to employees in accordance with SFAS No. 123 (revised 2004), Share-Based Payment (“SFAS 123R”).  Under SFAS 123R, the fair value of stock options at the date of grant is recognized in earnings over the vesting period of the options.  The Company adopted the new standard using the prospective method.  Under the prospective method, the Company will continue to account for non-vested awards outstanding at the date of adoption of SFAS 123R in the same manner as they had been accounted for prior to adoption for financial statement recognition purposes.  All awards granted, modified or settled after the date of adoption will be accounted for using the measurement, recognition and attribution provisions of SFAS 123R. There were no stock options granted during the years ended December 31, 2007 and 2006.

The Company accounts for equity instruments issued to non-employees in accordance with the provisions of SFAS 123R and Emerging Issues Task Force Issue No. 96-18, Accounting for Equity Instruments That Are Issued to Other Than Employees for Acquiring, or in Conjunction with Selling, Goods or Services.  All transactions in which goods or services are the consideration received for the issuance of equity instruments are accounted for based on the fair value of the consideration received or the fair value of the equity instrument issued, whichever is more reliably measurable.  The measurement date of the fair value of the equity instrument issued is the earlier of the date on which the counterparty's performance is complete or the date on which it is probable that performance will occur.

Sales and Marketing Expenses

Sales and marketing expense consist primarily of agent commissions and are expensed in the period incurred.

Income Taxes

The Company has elected to be an “S” corporation for federal tax purposes.  Accordingly, the Company is generally not subject to federal income taxes.  Taxable income or loss is included in the federal tax returns of the Company’s stockholders based on their respective ownership interests.  The Company is subject to various state income taxes.  Current and deferred state taxes are not significant to the Company’s financial statements.

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ONE RING NETWORKS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

NOTE 2.  PROPERTY AND EQUIPMENT

Property and equipment at December 31, 2007 and 2006 consists of the following:

	2007			2006
Network equipment	$	1,380,639		$	808,498
Office and computer equipment		84,233			84,233
Furniture and fixtures		13,874			11,020
Vehicles		44,184			25,599
		1,522,930			929,350
Less accumulated depreciation and amortization		(556,068	)		(158,105	)
	$	966,862		$	771,245

Property and equipment includes equipment under capital leases with costs of $822,868 and $263,142 at December 31, 2007 and 2006, respectively.  Accumulated depreciation associated with equipment under capital leases was $360,164 and $63,864 at December 31, 2007 and 2006, respectively.

Depreciation and amortization of property and equipment for the years ended December 31, 2007 and 2006 was $379,963 and $116,926, respectively, which includes depreciation associated with equipment under capital leases of $296,300 and $56,727, respectively.

NOTE 3.  CONVERTIBLE DEBT AND NOTES PAYABLE

Note payable due to related party

The Company has an unsecured promissory note (“Note Payable”) to a warrant holder of the Company in an original amount of $100,000.  The Note Payable bears interest at 10% per annum and requires monthly principal payments of $1,515 plus interest and matures in November 1010.  The Company is in default under the terms of the Note Payable as required payments have not been made.  Accordingly, the outstanding balance of the Note Payable of $90,000 at December 31, 2007 and 2006, is included in current liabilities in the accompanying balance sheets.  As further discussed in Note 10, the Note Payable and related accrued interest was converted to common stock in February 2008.

Convertible debt due to related parties

The Company has unsecured convertible notes (“Convertible Debt”) due to two shareholders of the Company.  The Convertible Debt bears interest at 8% per annum, has no stated maturity date and is convertible into common stock at $.35 per share.  The balance outstanding under the Convertible Debt at December 31, 2007 and 2006 is $1,000,140 and $650,140, respectively.  As further discussed in Note 10, all Convertible Debt and related accrued interest was converted to common stock in February 2008.

Notes payable for vehicles

The Company has two secured promissory notes (“Vehicle Notes”) for the financing of vehicles, one entered into during fiscal 2006 in the original amount of $29,099, which bears no interest and one entered into during fiscal 2007 in the original amount of $18,585 which bears interest at 7% per annum.  The Vehicle Notes require monthly payments ranging from $485 to $853 through November 2012.  The Vehicle Notes are secured by the underlying vehicles.  Balances outstanding under the Vehicle Notes at December 31, 2007 and 2006 totaled $36,270 and $23,765, respectively.

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ONE RING NETWORKS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

NOTE 3.  CONVERTIBLE DEBT AND NOTES PAYABLE (Continued)

Convertible debt and notes payable consists of the following as of December 31:

	2007			2006
Note Payable	$	90,000		$	90,000
Convertible Debt		1,000,140			650,140
Vehicle Notes		36,270			23,765
		1,126,410			763,905
Less current portion		(1,099,194	)		(746,219	)
	$	27,216		$	17,686

Future principal maturities of the Convertible Debt, Notes Payable and Vehicle Notes are as follows:

Year ending December 31:
2008		1,099,194
2009		9,289
2010		9,540
2011		4,960
2012		3,427
Total minimum future principal payments	$	1,126,410

Included in interest expense for the years ended December 31, 2007 and 2006 is $48,587 and $17,944, respectively, incurred to related parties.  Accrued interest due to related parties totaled $66,531 and $17,944 at December 31, 2007 and 2006, respectively.

NOTE 4.  LEASE COMMITMENTS

Capital and Operating Leases

The Company has obligations under capital leases forcertain equipment and under a non-cancelable operating lease for its operating facility which expires in March 2013.  The Company’s operating lease contains an escalation clause which provides for cost of living adjustments each year.  Rental expense under the operating lease was approximately $79,000 and $68,000 for the years ended December 31, 2007 and 2006, respectively.  A summary of the future minimum lease payments is as follows:

	Capital Leases			Operating Leases
2008	$	369,751		$	41,718
2009		122,949			42,973
2010		-			44,268
2011		-			45,604
2012		-			46,981
Thereafter		-			11,832
Total payments due		492,700		$	223,376
Less amount representing interest		(22,612	)
Present value of minimum lease payments		470,088
Less current portion capital lease obligations		(358,445	)
Capital lease obligations, net of current portion	$	111,643

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ONE RING NETWORKS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

NOTE 4.  LEASE COMMITMENTS (Continued)

Facilities Leases

The Company has obligations under various Facilities License Agreements (“Facilities Leases”) to commercial property owners related to communications and information technology equipment which is used in the Company’s wireless network services and owned by the Company housed within or atop the commercial property.  The Facilities Leases generally have terms of one to three years, require monthly payments between $150 and $5,000 and are renewed regularly.  A portion of the Company’s Facilities Leases contain escalation clause which provide for cost of living adjustments each year.  Total expense under these Facilities Leases was approximately $198,000 and $100,000 for the years ended December 31, 2007 and 2006, respectively, and is included within cost of services in the accompanying statements of operations.

NOTE 5.  LEGAL CONTINGENCIES

Effective February 19, 2008, the Company entered into a release and settlement agreement in connection with certain outstanding litigation whereby the Company was obligated to pay $21,000.  This litigation was originated during the year ended December 31, 2007.  The settlement amount of $21,000 has been recorded as accrued legal settlement at December 31, 2007 and is included general and administrative expenses in the accompanying statement of operations for the year ended December 31, 2007.  The settlement amount was paid in full during February 2008.

The Company is subject to various legal proceedings and claims arising in the ordinary course of business.  The Company believes there is no proceeding against it, either threatened or pending, that will result in a material adverse effect on its results of operations or financial condition.  However, there can be no assurance such legal proceedings and claims will not have a material impact.

NOTE 6.  EMPLOYEE BENEFIT PLAN

During the year ended December 31, 2007, the Company began offering a 401(k) retirement plan (“the Plan”) to its employees who are at least 18 years of age and have completed 90 days of service with the Company.  The Company makes matching contributions equal to 50% of employee contributions up to a maximum of 6% of annual compensation.  During the year ended December 31, 2007, the Company contributed approximately $1,700 to the Plan.

NOTE 7.  EQUITY

During 2005, the Company granted warrants to purchase 352,940 shares of the Company’s stock in exchange for services rendered.  The warrants have an exercise price of $0.0375 per share with no stated expiration date.  The warrants were fully vested upon grant during 2005 and remain outstanding at December 31, 2007.  These warrants were replaced with warrants for Rapid Link common stock in connection with the Purchase Agreement discussed in Note 10.

During the year ended December 31, 2007, the Company issued 350,000 shares of common stock to employees for services rendered.  These shares were valued at $122,500, the fair value of the Company’s stock on the date of issuance.

14

ONE RING NETWORKS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

NOTE 8.  CONCENTRATIONS AND CREDIT RISK

Financial instruments which potentially subject the Company to concentration of credit risk consist primarily of trade accounts receivable.  The Company sells its products primarily to customers geographically dispersed throughout the United States.  No single customer accounted for more than 10% of the Company’s revenues for the periods ended March 31, 2008 and 2007 or the years ended December 31, 2007 or 2006.  The Company extends credit to its customers without collateral.  The Company from time to time will require prepayment from customers. Management has evaluated accounts receivable at December 31, 2007 and 2006 and has provided an allowance for the estimated uncollectible accounts.  In the event of complete non-performance of accounts receivable, the maximum exposure to the Company is the recorded amount on the balance sheets.

The Company maintains funds in bank accounts which, from time to time, exceed federally insured limits.  To minimize risk, the Company places its cash with high credit quality institutions.

NOTE 9.  ADVANCES FROM RAPID LINK

During February and March 2008, the Company received working capital advances from Rapid Link totaling $130,000.

NOTE 10.  SUBSEQUENT EVENTS

In February 2008, the Company sold 767,432 shares of common stock to six individuals, four of which were existing shareholders, for total cash consideration of $268,601.

In March 2008, the Company amended its articles of incorporation to increase its authorized shares of common stock from 10,000,000 to 30,000,000.

In March 2008, the Company issued 3,606,325 shares of common stock in exchange for the conversion of all outstanding notes payable due to related parties and related accrued interest totaling $1,260,183.

On March 28, 2008, the Company finalized a Purchase Agreement (the “Agreement”) to sell all of its issued and outstanding shares of common stock to Rapid Link, a public telecommunications entity.  Under the terms of the Agreement, the Company will receive initial consideration from Rapid Link 3,885,448 shares of Rapid Link of common stock and 114,552 warrants for Rapid Link common stock, together valued at $319,393.  Additional consideration will be issuable upon achievement of certain performance thresholds, as defined in the Agreement.

15 

EX-99.2

EXHIBIT 99.2

UNAUDITED PRO FORMA CONDENSED COMBINED FINANCIAL INFORMATION OF RAPID LINK, INCORPORATED AND ONE RING NETWORKS, INC.

The following unaudited pro forma condensed combined financial statements gives effect to the acquisition of One Ring Networks, Inc. (“One Ring”) by Rapid Link, Incorporated (“Rapid Link”) as if it had been completed on November 1, 2006.  The following unaudited pro forma condensed combined statements of operations for the year ended October 31, 2007 and for the three and six months ended April 30, 2008 are derived from the historical financial statements of Rapid Link and One Ring.

Accordingly, the acquisition was accounted for under the purchase method of accounting, the aggregate consideration paid is allocated to the tangible and identified intangible asset acquired and liabilities assumed on the basis of their fair values on the transaction date.  Any excess purchase price is recorded as goodwill.

These unaudited pro forma condensed combined financial statements have been prepared based on preliminary estimates of fair values. The actual amounts recorded as of the completion of the acquisition may differ materially from the information presented in these unaudited pro forma condensed combined financial statements. In addition, the impact of ongoing integration activities could cause material differences in the information presented.

These unaudited pro forma condensed combined financial statements should be read in conjunction with the historical financial statements and accompanying notes of Rapid Link, as well as the sections entitled, "Management Discussion and Analysis or Plan of Operations" and "Risk Factors" included in the historical consolidated financial statements and accompanying notes of Rapid Link contained in Rapid Link's annual report on Form 10-KSB for the year ended October 31, 2007, and the unaudited consolidated condensed financial statements contained in Rapid Link's Quarterly Report on Form 10-QSB for the quarter ended April 30, 2008 incorporated by reference herein, together with the audited financial statements of One Ring for the year ended December 31, 2007 included as exhibit 99.1 herein. The unaudited pro forma condensed combined consolidated financial statements are not necessarily indicative of the consolidated results of operations or financial condition of the combined company that would have been reported had the acquisition been completed as of the dates presented, and are not necessarily representative of future consolidated results of operations or financial condition of the combined company.

1

UNAUDITED PRO FORMA CONDENSED COMBINED STATEMENT OF OPERATIONS

YEAR ENDED OCTOBER 31, 2007

	Historical
	Rapid Link, Inc.			One Ring Networks, Inc.			Pro Forma Adjustments			Pro Forma
Revenues	$	17,326,035		$	1,082,960		$	-		$	18,408,995
Costs and expenses:
Costs of revenues		12,559,905			674,486			-			13,234,391
Sales and marketing		1,212,355			53,903			-			1,266,258
General and administrative		3,403,674			1,197,323			-			4,600,997
Depreciation and amortization		928,427			397,963			7,801	(a)		1,334,191
Loss on disposal of property and equipment		10,061			-			-			10,061
Gain on legal settlements		(415,213	)		-			-			(415,213	)
		17,669,209			2,323,675			7,801			20,030,685
Operating loss		(373,174	)		(1,240,715	)		(7,801	)		(1,621,690	)
Other income (expense):
Noncash financing expense		(1,043,261	)		-			-			(1,043,261	)
Related party non cash financing expense		(33,089	)		-			-			(33,089	)
Interest expense		(284,414	)		(77,464	)		-			(361,878	)
Related party interest expense		(269,836	)		-			-			(269,836	)
Foreign currency exchange gain		4,389			-			-			4,389
		(1,626,211	)		(77,464	)		-			(1,703,675	)
Net loss	$	(1,999,384	)	$	(1,318,179	)	$	(7,801	)	$	(3,325,364	)
Basic and diluted loss per share	$	(.04	)				$	-		$	(.06	)
Weighted average shares used in the calculation of per share amounts		53,618,865						3,885,448			57,504,313

(a)  Customer list amortization.

2

UNAUDITED PRO FORMA CONDENSED COMBINED STATEMENT OF OPERATIONS

THREE MONTHS ENDED APRIL 30, 2008

	Historical
	Rapid Link, Inc.			One Ring Networks, Inc.			Pro Forma Adjustments			Pro Forma
Revenues	$	3,450,350		$	216,278		$	-		$	3,666,628
Costs and expenses:
Costs of revenues		2,323,353			168,007			-			2,659,367
Sales and marketing		193,406			16,258			-			209,664
General and administrative		1,063,053			196,868			-			1,259,921
Depreciation and amortization		268,432			119,345			1,300	(a)		389,077
		3,848,244			500,478			1,300			4,350,022
Operating loss		(397,894	)		(284,200	)		(1,300	)		(683,394	)
Other income (expense):
Noncash financing expense		(79,928	)		-			-			(79,928	)
Interest expense		(74,418	)		(10,926	)		-			(85,344	)
Related party interest expense		(64,800	)		-			-			(64,800	)
Foreign currency exchange loss		(2,796	)		-			-			(2,796	)
		(221,942	)		(10,926	)		-			(232,868	)
Income (loss) from continuing operations		(619,836	)		(295,126	)		(1,300	)		(916,262	)
Discontinued operations
Gain on disposal of discontinued operations		1,062,000			-			-			1,062,000
Net income (loss)	$	442,164		$	(295,126	)	$	(1,300	)	$	145,738
Basic and diluted income (loss) per share:
Loss per share from continuing operations	$	(.01	)							$	(.01	)
Income per share from discontinued operations		.02									.01
Net income (loss) per share	$	.01								$	-
Weighted average shares used in the calculation of per share amounts		66,987,044						2,590,148			69,577,192

(a) Customer list amortization

3

UNAUDITED PRO FORMA CONDENSED COMBINED STATEMENT OF OPERATIONS

SIX MONTHS ENDED APRIL 30, 2008

	Historical
	Rapid Link, Inc.			One Ring Networks, Inc.			Pro Forma Adjustments			Pro Forma
Revenues	$	7,463,829		$	487,468		$	-		$	7,951,297
Costs and expenses:
Costs of revenues		5,039,124			336,629			-			5,375,753
Sales and marketing		426,293			29,374			-			455,667
General and administrative		1,880,754			496,200			-			2,376,954
Depreciation and amortization		486,721			218,836			3,250	(a)		708,807
		7,832,892			1,081,399			3,250			8,917,181
Operating loss		(369,063	)		(593,931	)		(3,250	)		(965,884	)
Other income (expense):
Noncash financing expense		(234,117	)		-			-			(234,117	)
Interest income (expense)		(138,903	)		30,292			-			(108,611	)
Related party interest expense		(130,069	)		-			-			(130,069	)
Foreign currency exchange loss		(472	)		-			-			(472	)
		(503,561	)		30,292			-			(473,269	)
Loss from continuing operations		(872,624	)		(563,639	)		(3,250	)		(1,439,153	)
Discontinued operations
Gain on disposal of discontinued operations		1,062,000			-			-			1,062,000
Net income (loss)	$	189,376		$	(563,639	)	$	(3,250	)	$	(377,153	)
Basic and diluted income (loss) per share:
Loss per share from continuing operations	$	(.02	)							$	(.02	)
Income per share from discontinued operations		.02									.01
Net income (loss) per share	$	-								$	-
Weighted average shares used in the calculation of per share amounts		66,058,187						3,244,915			69,303,102

(a)  Customer list amortization

4

NOTES TO UNAUDITED PRO FORMA CONDENSED COMBINED FINANCIAL INFORMATION

NOTE 1.  PURCHASE PRICE CALCULATION.

On March 28, 2008, the Company acquired 100% of the outstanding stock of One Ring Networks, Inc. ("One Ring") for consideration of 3,885,448 common shares and 114,552 warrants valued at $319,393.  The value of the issued stock was determined to be $306,986 and was calculated using the average quoted price of $0.08 per share, which approximates the average trading value as quoted on the OTC Bulletin Board for the three days before and three days after the date the terms of the acquisition were agreed to and announced.  The 114,552 warrants to purchase common stock at $.12 per share were valued at $12,407.  The fair value of the warrants was determined on the date of grant using the Black-Scholes pricing model with the following assumptions: applicable risk-free interest rate based on the current treasury-bill interest rate of 4.14%; volatility factor of the expected market price of the Company's common stock of 1.65; and a life of the warrants of five years.

Additional contingent consideration can be attained with certain performance objectives being achieved.  In accordance with FASB No.141 Business Combinations, the Company will record any future consideration as an additional element of cost of the acquisition upon the resolution of said contingencies.  Additional contingent consideration consists of the issuance of Rapid Link common stock (“Secondary Shares”), which shall be delivered to the One Ring stockholders within five (5) days of the 1 year anniversary of the closing date provided that One Ring’s gross monthly retail billed revenues from all sources are at least $1,500,000 for the calendar year ending one year from the closing date (“Yearly Revenues”).  1333 Secondary Shares will be issued for every $1,000 of gross billed and collectable Yearly Revenues, up to a maximum of 4 million shares.

Section 2.4 (“Liability Adjustments”) of the Common Stock Purchase Agreement dated March 28, 2008 between the Company and One Ring stated that the purchase price shall be subject to reduction by the amount that the assumed liabilities of One Ring on March 28, 2008 exceed $198,445.  On June 16, 2008, the Company and One Ring amended the Stock Purchase Agreement to provide for the waiver of section 2.4 for consideration of $100,000.  On June 17, 2008, One Ring paid the Company $100,000 in consideration of the amendment to section 2.4.  Accordingly, the Company recorded the receipt of $100,000 as a reduction of goodwill.

NOTE 2.  PURCHASE PRICE ALLOCATION.

The Company acquired the following net assets from One Ring:

Tangible assets acquired:
Property and equipment	$	213,868
Capital lease equipment		379,765
Accounts receivable and other		202,372
Cash		25,396
		821,401
Customer list		15,601
Goodwill		310,678
Total assets acquired		1,147,680
Liabilities assumed:
Accounts payable		(295,041	)
Accrued liabilities and other		(119,453	)
Notes payable		(34,028	)
Capital lease obligations		(379,765	)
Total liabilities assumed		(828,287	)
Net assets acquired	$	319,393

5

NOTES TO UNAUDITED PRO FORMA CONDENSED COMBINED FINANCIAL INFORMATION

NOTE 3. PRO FORMA ADJUSTMENTS.

The unaudited pro forma condensed combined financial statements give effect to the transaction described in item 2.01 as if had occurred on November 1, 2006 for purposes of the pro forma condensed combined statements of operations for the year ended October 31, 2007 and for the three and six months ended April 30, 2008.  The pro forma statements of operations do not include any restructuring charges that may arise with respect to Rapid Link as a result of the transaction described in item 2.01.  Adjustments to the unaudited pro forma condensed combined statements of operations for the year ended October 31, 2007 and for the three and six months ended April 30, 2008 include an adjustment to the weighted average shares used in the calculation of per share amounts.

 6