Regains Compliance With NASDAQ Listing Requirements; Appoints Roni Eizenshtein Chief Financial Officer; To Delist From the Tel Aviv Stock Exchange

YAKUM, Israel, March 11, 2010 /PRNewswire-FirstCall/ -- Metalink Ltd. (NASDAQ: MTLKD), today announced its financial results for the fourth quarter and full year ended December 31, 2009.

FINANCIAL RESULTS

FINANCIAL HIGHLIGHTS FOR THE FOURTH QUARTER OF 2009: Revenues for the fourth quarter of 2009 were $0.7 million, comprising solely of WLAN sales, compared with revenues of $3.0 million for the comparable period in 2008, the majority of which were legacy DSL sales. Net loss for the fourth quarter of 2009 was $1.6 million, or $(0.06) per share, compared to net loss of $1.5 million, or $(0.06) per share, for the fourth quarter of 2008. Net loss for the fourth quarter of 2009 and 2008 includes stock-based compensation expenses of $0.07 million and $0.13 million, respectively.

FINANCIAL HIGHLIGHTS FOR THE YEAR ENDED DECEMBER 31, 2009: For the twelve-month period, revenues were $4.9 million compared to $7.2 million for 2008. Net loss for the year was $13.5 million, or $(0.54) per share, compared to net loss of $21.0 million, or $(0.89) per share, for 2008. Net loss for 2009 and 2008 includes stock-based compensation expenses of $0.5 million and $1.8 million, respectively.

FINANCIAL INCOME, net, in the fourth quarter of 2009 was $0.24 million, compared to $1.2 million financial expenses in the third quarter of 2009. The change from financial expenses to financial income is primarily attributable to a decrease in the face value of the loan, due to a recent amendment to the agreement with the lender, and to the cessation of amortization of the short term loan's discount during the third quarter (see below), all of which are non-cash expenses.

CASH STATUS: Metalink's cash and cash equivalents, as of December 31, 2009 were $2.3 million.

SHORT TERM LOAN: During the fourth quarter, the Company has entered into an amendment to its loan agreement with an institutional investor, under which the repayment of the $4,312,500 originally due upon the closing of the Lantiq transaction will be reduced to $4,100,000 and repaid in four installments: $3,750,000 at closing, which occurred on February 15, 2010, and the remainder in three installments by March 31, 2011.

CLOSING OF THE LANTIQ TRANSACTION: during the first quarter of 2010, the Company announced it has completed the sale of its wireless local area network (WLAN) business to Lantiq. Additional details regarding sale of the WLAN business, are included in the Company's Report on Form 6-K that was filed on February 16, 2010 with the Securities and Exchange Commission (SEC).

COMPLIANCE WITH NASDAQ LISTING REQUIREMENTS: NASDAQ staff has informed the Company on March 8, 2010 that the Company has regained compliance with the minimum bid price requirement in Listing Rule 5550(a)(2) and the minimum shareholders' equity requirement in Listing Rule 5550(b)(1). Accordingly, the staff has determined to continue the listing of the Company's securities on The Nasdaq Stock Market.

APPOINTMENT OF CFO: Mr. Rony Eizenshtein, 45, is a senior manager at Brooks-Keret Ltd., a reputable Israeli provider of financial and accounting services. He is an experienced CPA who served as a controller and CFO in various Israeli public companies. Mr. Eizenshtein will be serving as CFO commencing as of March 31st 2010, as part of the Company's engagement with Brooks-Keret to provide CFO and other financial and accounting services to the Company.

DELISTING FROM TASE: The Company also reported today that its Board of Directors resolved to delist the Company's ordinary shares from trading on the Tel Aviv Stock Exchange (TASE). Consequently, the Company requested the TASE to initiate the delisting process.

Under applicable Israeli law, the delisting of the ordinary shares from trading on the TASE is expected to become effective within three months from the date of application to the TASE. During the interim period, Metalink's ordinary shares will continue to be traded on the TASE. Metalink will announce the exact date of the delisting when it becomes available.

Metalink's shares will continue to be listed on the NASDAQ Capital Market, and the Company will continue to file public reports in accordance with the rules and regulations of NASDAQ and of the U.S. Securities and Exchange Comission as they apply to a foreign private issuer such as Metalink.

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SAFE HARBOR STATEMENT

This press release contains "forward looking statements" within the meaning of the United States securities laws. Words such as "aim," "expect," "estimate," "project," "forecast," "anticipate," "intend," "plan," "may," "will," "could," "should," "believe," "predicts," "potential," "continue," and similar expressions are intended to identify such forward-looking statements. For example, when we discuss our continued listing on NASDAQ, we are using a forward looking statement. Because such statements deal with future events, they are subject to various risks and uncertainties that could cause actual results to differ materially from those in the forward looking statements. Factors that could cause or contribute to such differences include, but are not limited those set forth from time to time in Metalink's filings with the SEC, including Metalink's Annual Report in Form F-20. Readers are cautioned not to place undue reliance on forward-looking statements. Except as required by applicable law, the Company undertakes no obligation to republish or revise forward-looking statements to reflect events or circumstances after the date hereof or to reflect the occurrences of unanticipated events. The Company cannot guarantee future results, events, and levels of activity, performance, or achievements.

                                  METALINK LTD.
                           CONSOLIDATED BALANCE SHEETS

                                              December 31,     December 31,
                                             --------------- ---------------
                                                2 0 0 9         2 0 0 8
                                             --------------- ---------------

                                           (in thousands, except share data)
                                           ---------------------------------

    ASSETS
    Current assets
    Cash and cash equivalents                       $ 2,273         $ 5,166
    Short-term investments                                -             677
    Trade accounts receivable                           461           2,515
    Other receivables                                   602           1,529
    Prepaid expenses                                     88             209
    Deferred charges                                      -             242
    Inventories                                       1,068           2,508
                                                 -----------     -----------
    Total current assets                              4,492          12,846
                                                 -----------     -----------




    Severance pay fund                                1,229           1,195
                                                 -----------     -----------



    Property and equipment, net                       2,145           3,338
                                                 -----------     -----------


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


    Total assets                                    $ 7,866        $ 17,379
                                                 ===========     ===========


    LIABILITIES AND SHAREHOLDERS' EQUITY
    (DEFICIENCY)
    Current liabilities
    Trade accounts payable                          $ 1,542           $ 739
    Other payables and accrued expenses               3,239           3,257
    Short term loan                                   4,100           2,101
    Warrants to issue shares                            289             196
                                                 -----------     -----------


    Total current liabilities                         9,170           6,293
                                                 -----------     -----------



    Accrued severance pay                             1,798           2,098
                                                 -----------     -----------



    Shareholders' equity (deficiency)
    Ordinary shares of NIS 0.1 par value
    (Authorized - 50,000,000 shares, issued
    and outstanding 26,637,232 and
    24,752,232 shares as of December 31,
    2009 and December 31, 2008,
    respectively)                                       759             711
    Additional paid-in capital                      157,692         156,500
    Accumulated other comprehensive loss                  -           (124)
    Accumulated deficit                           (151,668)       (138,214)
                                                 -----------     -----------


                                                      6,783          18,873
                                                 -----------     -----------


    Treasury stock, at cost; 898,500 as of

    December 31, 2009 and December 31, 2008         (9,885)         (9,885)
                                                 -----------     -----------



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


    Total shareholders' equity (deficiency)         (3,102)           8,988
                                                 -----------     -----------


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


    Total liabilities and shareholders'
    equity (deficiency)                            $ 7,866         $ 17,379
                                                 ===========     ===========


                                  METALINK LTD.
                      CONSOLIDATED STATEMENTS OF OPERATIONS

                                    Three months ended          Year ended
                                       December 31,            December 31,
                                  --------------------- ---------------------
                                      2009       2008        2009       2008
                                  ---------- ---------- ---------- ----------

                                        (Unaudited)
                                  --------------------- ---------------------
                              (in thousands, except share and per share data)
                                  -------------------------------------------

    Revenues                           $ 671    $ 3,018    $ 4,916    $ 7,162
                                  ---------- ---------- ---------- ----------

    Cost of revenues:
    Costs and expenses                   803      1,256      3,174      2,964
    Royalties to the Government
    of Israel                             26         86        160        218
                                  ---------- ---------- ---------- ----------

    Total cost of revenues               829      1,342      3,334      3,182
                                  ---------- ---------- ---------- ----------


    Gross profit (loss)                (158)      1,676      1,582      3,980
                                  ---------- ---------- ---------- ----------


    Operating expenses:
    Gross research and
    Development                        1,492      3,132      9,627     22,516
    Less - Royalty bearing and
    other grants                         607        541      1,898      3,068
                                  ---------- ---------- ---------- ----------

    Research and development, net        885      2,591      7,729     19,448
                                  ---------- ---------- ---------- ----------


    Selling and marketing                314        416      1,397      4,502
    General and administrative           504        589      2,416      2,647
                                  ---------- ---------- ---------- ----------

    Total operating expenses           1,703      3,596     11,542     26,597
                                  ---------- ---------- ---------- ----------


    Operating loss                   (1,861)    (1,920)    (9,960)   (22,617)

    Financial income (expenses),
    Net                                  240        408    (3,494)      1,639
                                  ---------- ---------- ---------- ----------



    Net loss                       $ (1,621)  $ (1,512) $ (13,454) $ (20,978)
                                  ========== ========== ========== ==========

    Loss per ordinary share:
    Basic                           $ (0.06)   $ (0.06)   $ (0.54)   $ (0.89)
                                  ========== ========== ========== ==========


    Diluted                         $ (0.06)   $ (0.06)   $ (0.54)   $ (0.89)
                                  ========== ========== ========== ==========


    Shares used in computing loss
    per ordinary share:

    Basic                         25,738,732 23,807,288 24,828,636 23,569,711
                                  ========== ========== ========== ==========


    Diluted                       25,738,732 23,807,288 24,828,636 23,569,711
                                  ========== ========== ========== ==========


    Eran Vital
    General Counsel
    Metalink Ltd.
    Tel: +972-9-9605555
    Fax: +972-9-9605544
    Eranv@MTLK.com

SOURCE Metalink Ltd

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