UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549

                                  FORM 10-QSB/A
                                 Amendment No. 2

(Mark One)
/ X /      QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d)
           OF THE SECURITIES EXCHANGE ACT OF 1934

           For the quarterly period ended September 30, 2002
OR

/ /        TRANSITION REPORT PURSUANT TO SECTION 13 or 15(d)
           OF THE SECURITIES EXCHANGE ACT OF 1934.

           For the transition period from ________ to ________.


                         Commission file number 0-26059

                               CIRTRAN CORPORATION
                               -------------------
             (Exact name of registrant as specified in its charter)



Nevada                                                          68-0121636
----------------------------                                    -----------
(State or other jurisdiction of              (I.R.S. Employer Identification No)
incorporation or organization)


                              4125 South 6000 West
                          West Valley City, Utah 84128
                          ---------------------- ------
               Address of Principal Executive Offices) (Zip Code)


                                 (801) 963-5112
                         (Registrant's telephone number)


Indicate by check mark whether the registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the  proceeding  12 months and (2) has been subject to such filing  requirements
for the past 90 days. Yes X No ____

The number of shares outstanding of the registrant's common stock as of November
19, 2002: 211,772,191.


Transitional Small Business Disclosure Format (check one): Yes ____   NO  X

<PAGE>

The purpose of this amendment to CirTran Corporation's  Quarterly Report on Form
10-QSB is to show the effects of a fourth quarter  adjustment,  discussed in the
Company's  Annual Report on Form 10KSB for the year ended  December 31, 2001, on
the period ended September 30, 2001. Also the segment  information  contained in
Note 7 has been corrected.

This  amendment  does not  reflect  events  occurring  after  the  filing of the
Quarterly Report on November 20, 2002, the original filing date of the Quarterly
Report,  or modify or update those disclosures as presented in the original Form
10-QSB,  except to reflect the restatement as described  above,  and to describe
certain  subsequent  events in Note 8 to the  unaudited  Condensed  Consolidated
Financial Statements.


                                                                            Page
PART I - FINANCIAL INFORMATION

Item 1   Condensed Consolidated Financial Statements

Balance Sheets as of September 30, 2002 (unaudited) and                      3
December 31, 2001

Statements of Operations for the Nine Months ended                          4
September 30, 2002 (unaudited) and 2001 (unaudited)

Statements of Cash Flows for the Nine Months ended                          5
September 30, 2002 (unaudited) and 2001 (unaudited)

Notes to Condensed Consolidated Financial Statements                        6
(unaudited)

Item 2     Management's Discussion and Analysis of Financial Condition and
           Results of Operation                                             9

PART II - OTHER INFORMATION

Item 1     Legal Proceedings                                                14

Item 2     Changes in Securities                                            14

Item 5     Other Information                                                15

Item 6     Exhibits and Reports on Form 8-K                                 15

Signatures                                                                  16



<PAGE>



                                        6
                       CIRTRAN CORPORATION AND SUBSIDIARY
                CONDENSED CONSOLIDATED BALANCE SHEETS (UNAUDITED)


<TABLE>
<CAPTION>

                                                                      September 30,     December 31,
                                                                    ----------------------------------
                                                                         2002               2001
                                                                    ----------------   ---------------

                              ASSETS
Current assets
<S>                                                                 <C>                <C>
Cash and cash equivalents                                           $           882    $          499
Trade accounts receivable, net of allowance for doubtful accounts
of $32,317 and $66,316, respectively                                        158,807           369,250
Inventories                                                               1,624,543         1,773,888
Subscription receivable                                                      25,000                 -
Other                                                                       100,561            97,037
                                                                    ----------------   ---------------
Total current assets                                                      1,909,793         2,240,674

Property and equipment, at cost, net                                        968,371         1,333,925
Other assets, net                                                            23,102            10,887
                                                                    ----------------   ---------------
Total Assets                                                        $     2,901,266    $    3,585,486
                                                                    ================   ===============

                       LIABILITIES AND STOCKHOLDERS' DEFICIT

Current Liabilities
Checks written in excess of cash in bank                            $       123,268    $      159,964
Accounts payable                                                          1,297,281         2,141,290
Accrued liabilities                                                       3,230,117         3,071,191
Notes payable to stockholders                                                 2,465         1,390,125
Notes payable to related parties                                          1,547,397         2,405,507
Current maturities of capital lease obligations                                   -            41,206
Current maturities of long-term notes payable                             1,157,656           863,650
                                                                    ----------------   ---------------
Total current liabilities                                                 7,358,184        10,072,933
                                                                    ----------------   ---------------

Long-Term Liabilities
Long-term notes payable, less current maturities                            201,206           447,155
Capital lease obligations, less current maturities                                -             7,775
                                                                    ----------------   ---------------
Total long-term liabilities                                                 201,206           454,930
                                                                    ----------------   ---------------

Commitments and Contingencies

Stockholders' Deficit
Common stock, par value $0.001; authorized 750,000,000 shares;
issued and outstanding 211,772,191 at September 30, 2002 net of
3,000,000 shares held in treasury at no cost and 160,951,005
at December 31, 2001                                                        211,772           160,951
Additional paid-in capital                                                9,510,433         5,977,164
Accumulated deficit                                                     (14,380,329)      (13,080,492)
                                                                    ----------------   ---------------
Total Stockholders' Deficit                                              (4,658,124)       (6,942,377)
                                                                    ----------------   ---------------
Total Liabilities and Stockholders' Deficit                         $     2,901,266    $    3,585,486
                                                                    ================   ===============
</TABLE>


                 See accompanying notes to unaudited condensed
                       consolidated financial statements.

                                       3
<PAGE>

                       CIRTRAN CORPORATION AND SUBSIDIARY
           CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED)

<TABLE>
<CAPTION>
                                                    For the Three Months Ended,                 For the Nine Months Ended,
                                                          September 30,                               September 30,
                                             ------------------------------------------  ------------------------------------------
                                                    2002                  2001                  2002                  2001
                                             --------------------  --------------------  --------------------  --------------------
<S>                                          <C>                   <C>                   <C>                   <C>
Net Sales                                    $           367,755   $           474,055   $         1,981,103   $         1,545,020

Cost of Sales                                            358,869               499,772             1,735,380             1,794,854
                                             --------------------  --------------------  --------------------  --------------------

Gross Profit/(Loss)                                        8,886               (25,717)              245,723              (249,834)

Operating Expenses
Selling, general and administrative expenses             516,650               393,368             1,400,240             1,238,036
Non-cash compensation expense                             25,000                     -                25,000                     -
                                             --------------------  --------------------  --------------------  --------------------
Total Operating Expenses                                 541,650               393,368             1,425,240             1,238,036

Loss From Operations                                    (532,764)             (419,085)           (1,179,517)           (1,487,870)
                                             --------------------  --------------------  --------------------  --------------------

Other income (expense)
Interest                                                 (41,865)             (124,452)             (282,609)             (667,959)
Other, net                                                    97                    25               162,289                 4,125
                                             --------------------  --------------------  --------------------  --------------------
                                                         (41,768)             (124,427)             (120,320)             (663,834)
                                             --------------------  --------------------  --------------------  --------------------

Net Loss                                     $          (574,532)  $          (543,512)  $        (1,299,837)  $        (2,151,704)
                                             ====================  ====================  ====================  ====================

Basic and diluted loss per common share      $             (0.00)  $             (0.00)  $             (0.01)  $             (0.01)
                                             ====================  ====================  ====================  ====================
Basic and diluted weighted-average
common shares outstanding                            209,652,626           157,947,744           205,907,734           156,855,950
                                             ====================  ====================  ====================  ====================
</TABLE>


                 See accompanying notes to unaudited condensed
                       consolidated financial statements.

                                       4

<PAGE>


                       CIRTRAN CORPORATION AND SUBSIDIARY
           CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED)


<TABLE>
<CAPTION>
                                                                               For the Nine Months Ended,
                                                                                       September 30,
                                                                   ---------------------------------------------------
                                                                            2002                        2001
                                                                   -----------------------     -----------------------

Cash flows from operating activities
<S>                                                                <C>                         <C>
Net loss                                                           $           (1,299,837)     $           (2,151,704)
Adjustments to reconcile net loss to net
cash used in operating activities:
Depreciation and amortization                                                     368,376                     374,791
Provision for loss on trade receivables                                           (33,999)                     31,399
Settlement of litigation                                                          (25,000)                          -
Non-cash compensation expense                                                      25,000
Issuance of common stock options for prepaid commission                                 -                     200,000
Payments made on behalf of the Company
as a settlement of a sublease agreement                                          (152,500)                          -
Changes in assets and liabilities:
Trade accounts receivable                                                         244,442                     458,496
Inventories                                                                       149,345                     (16,936)
Other assets                                                                       (8,739)                   (198,502)
Accounts payable                                                                 (547,727)                    397,240
Accrued liabilities                                                               366,602                     771,738
                                                                   -----------------------     -----------------------

Total adjustments                                                                 385,800                   2,018,226
                                                                   -----------------------     -----------------------

Net cash used in operating activities                                            (914,037)                   (133,478)
                                                                   -----------------------     -----------------------

Cash flows from investing activities
Purchase of property and equipment                                                 (2,822)                     (1,844)
                                                                   -----------------------     -----------------------

Net cash used in investing activities                                              (2,822)                     (1,844)
                                                                   -----------------------     -----------------------

Cash flows from financing activities
Increase (decrease) in checks written in excess of cash in bank                   (36,696)                    134,841
Payments on notes payable to stockholders                                        (140,125)                          -
Principal payments on long-term notes payable                                    (348,402)                   (311,462)
Principal payments on capital leases                                                    -                      (4,550)
Proceeds from long-term notes payable                                             655,000                           -
Proceeds from notes payable to stockholders                                         2,465                     305,625
Proceeds from exercise of options to purchase common stock                        285,000                           -
Proceeds from issuance of common stock                                            500,000                           -
                                                                   -----------------------     -----------------------

Net cash provided by financing activities                                         917,242                     124,454
                                                                   -----------------------     -----------------------

Net increase (decrease) in cash and cash equivalents                                  383                     (10,868)

Cash and cash equivalents at beginning of period                                      499                      11,068
                                                                   -----------------------     -----------------------

Cash and cash equivalents at end of period                         $                882        $                200
                                                                   =======================     =======================
</TABLE>

                 See accompanying notes to unaudited condensed
                       consolidated financial statements.

                                       5
<PAGE>


                       CIRTRAN CORPORATION AND SUBSIDIARY
           CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED)
                                   (CONTINUED)


<TABLE>
<CAPTION>
                                                                            For the Nine Months Ended,
                                                                                    September 30,
                                                                ---------------------------------------------------
                                                                         2002                        2001
                                                                -----------------------     -----------------------
Supplemental disclosure of cash flow information

<S>                                                             <C>                         <C>
Cash paid for interest                                          $              186,311      $               53,013

Noncash investing and financing activities

Prepaid commission by stock option issuance                     $                    -      $              200,000
Notes payable issued for accounts payable                                      345,263                           -
Common stock issued for notes payable to stockholders                        1,250,000                           -
Common stock issued for notes payable                                        1,499,090                           -
Legal fees to be paid on behalf of lender                                      120,000                           -
Accrued interest converted to notes payable                                     41,301                           -
Exercise of options for subscription receivable                                 25,000                           -
</TABLE>


                 See accompanying notes to unaudited condensed
                       consolidated financial statements.

                                       6
<PAGE>



                       CIRTRAN CORPORATION AND SUBSIDIARY
        NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)



NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Condensed   Financial   Statements  --  The  accompanying   unaudited  condensed
consolidated  financial  statements include the accounts of CirTran  Corporation
and its subsidiary (the  "Company").  These  financial  statements are condensed
and, therefore,  do not include all disclosures  normally required by accounting
principles generally accepted in the United States of America.  These statements
should be read in conjunction  with the Company's  annual  financial  statements
included in the Company's  December 31, 2001,  Annual Report on Form 10-KSB.  In
particular,  the Company's  significant  accounting principles were presented as
Note 1 to the consolidated  financial  statements in that report. In the opinion
of  management,  all  adjustments  necessary for a fair  presentation  have been
included in the accompanying  condensed  consolidated  financial  statements and
consist  of  only  normal  recurring  adjustments.  The  results  of  operations
presented in the accompanying  condensed  consolidated  financial statements for
the nine months ended September 30, 2002 are not  necessarily  indicative of the
results that may be expected for the full year ending December 31, 2002.

NOTE 2 - REALIZATION OF ASSETS

The accompanying  condensed consolidated financial statements have been prepared
in conformity with accounting principles generally accepted in the United States
of America,  which  contemplate  continuation of the Company as a going concern.
However,  the Company  sustained net losses of $1,299,837 and $2,933,084 for the
nine months  ended  September  30, 2002,  and the year ended  December 31, 2001,
respectively.  As of September 30, 2002,  and December 31, 2001, the Company had
an accumulated deficit of $14,380,329 and $13,080,492,  respectively and a total
stockholders' deficit of $4,658,124 and $6,942,377,  respectively.  In addition,
the Company used, rather than provided, cash in its operations in the amounts of
$914,037 and $288,724 for the nine months ended September 30, 2002, and the year
ended December 31, 2001, respectively.

Since February 2000, the Company has operated without a line of credit.  Many of
the Company's  vendors stopped credit sales of components used by the Company to
manufacture  products  and as a result,  the  Company  converted  certain of its
turnkey customers to customers that provide consigned  components to the Company
for production.  These  conditions raise  substantial  doubt about the Company's
ability to continue as a going concern.

In view of the matters described in the preceding paragraphs,  recoverability of
a  major  portion  of the  recorded  asset  amounts  shown  in the  accompanying
consolidated  balance  sheets is  dependent  upon  continued  operations  of the
Company,  which in turn is  dependent  upon the  Company's  ability  to meet its
financing  requirements  on a continuing  basis,  to maintain or replace present
financing,  to acquire additional capital from investors,  and to succeed in its
future  operations.  The  financial  statements  do not include any  adjustments
relating to the  recoverability  and classification of recorded asset amounts or
amounts and  classification  of liabilities  that might be necessary  should the
Company be unable to continue in existence.

Abacas Ventures, Inc. ("Abacas") purchased the Company's line of credit from the
lender.  During the nine months ended  September 30, 2002,  the Company  entered
into an agreement whereby the Company exchanged common stock,  issued to certain
principles of Abacas,  for a portion of the debt.  The  Company's  plans include
working with vendors to convert trade payables into long-term  notes payable and
common stock and cure defaults with lenders through forbearance  agreements that
the Company will be able to service.  The Company  intends to continue to pursue


                                       7
<PAGE>

this type of debt conversion going forward with other creditors. The Company
also intends to continue to work with Abacas to maintain the good working
relationship between the Company and Abacas.  The Company has
initiated  new credit  arrangements  for smaller  dollar  amounts  with  certain
vendors and will pursue a new line of credit  after  negotiations  with  certain
vendors are complete.  If successful,  these plans may add significant equity to
the Company. There is no assurance that these transactions will occur.

NOTE 3 - RELATED PARTY TRANSACTIONS

Stockholder  Notes  Payable  -- The  Company  paid  cash and  issued  stock as a
settlement  of the  principal  amounts  due on two  separate  notes  payable  to
stockholders.  An  additional  $2,465 was  advanced  to the  company  during the
quarter ended September 30, 2002. The principal  balance due to stockholders was
$2,465  and   $1,390,125  at  September   30,  2002,   and  December  31,  2001,
respectively.  Interest  associated with amounts due to stockholders was accrued
at 10 percent.  Unpaid  accrued  interest was $210,734 and $205,402 at September
30,  2002,  and  December  31,  2001,  respectively,  and is included in accrued
liabilities. These notes are due on demand.

During the nine months ended September 30, 2002,  Abacas completed  negotiations
with several vendors of the Company,  whereby Abacas purchased  various past due
amounts for goods and services  provided by vendors,  as well as capital leases.
The total of these  obligations  was  $345,263.  In addition,  Abacas  agreed to
deduct as an offset of the  amount  owed to Abacas  $120,000,  constituting  the
amounts paid by the Company as legal fees incurred by the Company as part of its
negotiations  with  the  Company's  vendors.   The  Company  has  recorded  this
transaction as a $345,263  non-cash  increase and a $120,000 non-cash payment to
the note payable owed to Abacas, pursuant to the terms of the Abacas agreement.

Additionally, the Company entered into a bridge loan agreement with Abacas. This
agreement  allows  the  Company  to request  funds  from  Abacas to finance  the
build-up of inventory relating to specific sales. The loan bears interest at 24%
and is payable on demand.  There are no required monthly payments, but the
principal  balance cannot exceed  $600,000 at any point in time.  During the
nine months ended September 30, 2002, the Company received aggregate advances
of $655,000 and made cash payments of $156,258 for an outstanding  balance
on the  bridge  loan of  $498,742.  The total  principal  amount  owed to Abacas
between the note payable and the bridge loan was  $1,547,397 as of September 30,
2002.

For the nine months ended September 30, 2002, the Company recorded $174,418 of
accrued interest and paid $7,089 of interest on the Abacas loans.  Total accrued
interest due at September 30, 2002, was $548,255.

NOTE 4 - COMMITMENTS AND CONTINGENCIES

Settlement of Litigation - During the nine months ended  September 30, 2002, the
Company settled a lawsuit that alleged a breach of facilities sublease agreement
involving facilities located in Colorado. The Company's liability in this action
was originally  estimated to range up to $2.5 million.  The Company subsequently
filed a counter  suit in the same  court for an amount  exceeding  $500,000  for
missing equipment.

Effective  January 18, 2002,  the Company  entered  into a settlement  agreement
which  required the Company to pay the  plaintiff  the sum of $250,000.  Of this
amount,  $25,000 was paid upon  execution  of the  settlement,  and the balance,
together  with  interest  at 8% per  annum,  was  payable by July 18,  2002.  As
security for payment of the balance,  the Company  executed and delivered to the
plaintiff a Confession  of Judgment and also issued  3,000,000  shares of common
stock,  which are  currently  held in escrow and have been  treated as  treasury
stock recorded at no cost. Because seventy-five percent (75%) of the balance had
not been paid by May 18, 2002, the Company was required to prepare and file with


                                       8
<PAGE>

the  Securities  &  Exchange  Commission,  at its own  expense,  a  registration
statement with respect to the escrowed  shares.  Because,  by July 18, 2002, the
remaining balance had not been paid, the registration  statement with respect to
the escrowed  shares had not been  declared  effective,  and the Company had not
replaced the escrowed shares with registered free-trading shares pursuant to the
terms of the  settlement  agreement,  the  plaintiff  filed  the  Confession  of
Judgment  and  proceeded  with  execution  thereon.  The  Company  is  currently
negotiating with the plaintiff to settle this obligation  without the release of
the shares held in escrow.

In  connection  with a separate  sublease  agreement  of these  facilities,  the
Company  received a settlement from the sublessee  during May 2002 in the amount
of  $152,500,  which has been  recorded  as other  income.  The  Company did not
receive cash from this settlement,  but certain  obligations of the Company were
paid as follows:  $109,125 of the principal balance of the note described in the
preceding  paragraph related to the settlement  mentioned above was paid; $7,000
was paid to the Company's legal counsel as a retainer for future  services;  and
the remaining $36,375 was paid to the above mentioned  plaintiff as a settlement
of rent expense.

During September 2002, the plaintiff has filed a claim that the $109,125 portion
of the payment was to be applied as additional rent expense rather than a
principal payment on the note payable.  The Company estimates that the
probability of the $109,125 being considered additional rent expense is remote
and disputes the claim.  The Company intends to vigorously defend the action.

Litigation  - In December  1999,  a vendor of the Company  filed a lawsuit  that
alleges  breach of  contract  and seeks  payment in the amount of  approximately
$213,000  of  punitive  damages  from  the  Company  related  to  the  Company's
non-payment  for  materials  provided  by the  vendor.  The  Company  denies all
substantive allegations made by the vendor and intends to vigorously contest the
case.

The  Company  has been a party to a lawsuit  with a  customer  stemming  from an
alleged breach of contract.  In July 2002, the Company reached a settlement with
the  customer in which the customer  was to make  payments  from August 1, 2002,
through  October 29,  2002,  to the Company  totaling  $265,000.  As part of the
settlement,   the  Company  returned  inventory  valued  at  $158,010,   settled
receivables from the customer of 287,277,  settled payables owed to the customer
in the  amount  of  $180,287  and sold  inventory  to a Company  related  to the
customer for $13,949.  At September 30, 2002, the Company had received $185,000.
Subsequent  to  September  30,  2002,  the final  payment  of  $80,000  had been
collected.

During  October 1999, a former vendor of the Company  brought action against the
Company alleging that the Company owed approximately  $199,600 for materials and
services  and terms of a  promissory  note.  The  Company  entered a  settlement
agreement  under  which the  Company is to pay  $6,256.24  each month  until the
obligation and interest thereon are paid. This did not represent the forgiveness
of any  obligation,  but rather the  restructuring  of the terms of the previous
agreement.  The  Company has  defaulted  on its  payment  obligations  under the
settlement  agreement.  The Company is currently  negotiating  a new  settlement
agreement.

Judgment was entered in favor of a vendor  during  March 2002,  in the amount of
$181,342 for  nonpayment of costs of goods or services  provided to the Company.
At December 31, 2001 the Company had accrued the entire amount of the claim. The
Company is currently in settlement negotiations with the vendor.

An individual  filed suit during January 2001,  seeking to recover the principal
sum of $135,941,  plus interest on a promissory  note. The parties are presently
negotiating settlement.



                                       9
<PAGE>

During March 2000, a vendor  brought suit against the Company under  allegations
that the Company  owed  approximately  $97,000 for the cost of goods or services
provided to the Company for the Company's use and benefit.  The Company issued a
note payable to the vendor in  settlement  of the amount owed and is required to
pay the vendor $1,972 each month until paid. The Company is currently in default
on this obligation and is currently negotiating a new settlement agreement.

A financial  institution  brought suit against the Company during February 2000,
alleging that the Company owed approximately $439,000 for a loan provided to the
Company for the  Company's  use and benefit.  Judgment  was entered  against the
Company and certain guarantors in the amount of $427,291.69 plus interest at the
rate of 8.61% per annum from June 27, 2000.  The Company has  subsequently  made
payments to the financial  institution,  reducing the  obligation to $273,089 at
September 30, 2002,  plus interest  accruing from January 1, 2002.  Negotiations
for settlement of the remaining claims are underway.

Suit was brought against the Company during April, 2001, by a former shareholder
alleging that the Company owed $121,825 under the terms of a promissory  note. A
Stipulation for Settlement and for Entry of Judgment was executed by the parties
wherein  the Company  agreed to arrange  for  payment of a  principal  amount of
$145,000 in 48 monthly  installments.  The Company made seven  payments and then
failed to make subsequent  payments,  at which time the  shareholder  obtained a
consent  judgment  against the Company.  The Company is currently in  settlement
negotiations with the former shareholder regarding the judgment.

The Company is the defendant in numerous legal actions primarily  resulting from
nonpayment of vendor invoices for goods and services  received.  The Company has
accrued the payables and is currently in the process of negotiating  settlements
with these vendors.

Registration  Rights - In  connection  with the  conversion  of certain  debt to
equity,  the Company has granted the holders of 5,281,050 shares of common stock
the right to include 50% of the common stock of the holders in any  registration
of common stock of the Company,  under the  Securities  Act for offer to sell to
the public (subject to certain exceptions).  The Company has also agreed to keep
any filed registration  statement  effective for a period of 180 days at its own
expense.

Additionally,  in connection with the Company's  entering into an Equity Line of
Credit  Agreement  (described in Note 9), the Company granted to the equity line
investor (the "Equity Line Investor")  registration  rights,  in connection with
which the Company is  required to file a  registration  statement  covering  the
resale of shares put to the Equity  Line  Investor  under the equity  line.  The
Company is also required to keep the registration  statement effective until two
years  following the date of the last advance under the equity line. The Company
has not yet filed such registration statement.

Accrued  Payroll Tax  Liabilities  -- As of September 30, 2002,  the Company had
accrued  liabilities in the amount of $2,219,709  for delinquent  payroll taxes,
including interest estimated at $281,689 and penalties estimated at $264,249. Of
this amount,  approximately $301,980 was due the State of Utah. During the first
quarter of 2002, the Company  negotiated a monthly payment schedule of $4,000 to
the State of Utah,  which did not  provide  for the  forgiveness  of any  taxes,
penalties or interest.  These  monthly  payments  were not made during the third
quarter.  Approximately  $1,906,790  is owed to the  Internal  Revenue  Service.


                                       10
<PAGE>

During the first quarter of 2002, the Company negotiated a payment schedule with
respect to this  amount,  pursuant to which  monthly  payments  of $25,000  were
required.  In addition,  the Company committed to keeping current on deposits of
federal withholding amounts. The required monthly payments were made during each
of the three months during the second quarter. None of the monthly payments were
made during the third quarter. The Company is currently  renegotiating the terms
of the payment  schedule with the Internal  Revenue  Service.  In addition,  the
Company  failed  to  pay  several  of  its  current   withholding   obligations.
Approximately $10,939 is owed to the State of Colorado.

NOTE 5 - STOCKHOLDERS' EQUITY

Common Stock Issued for Cash and Debt - Effective  January 14, 2002, the Company
entered into four substantially  identical agreements with existing shareholders
pursuant  to which the  Company  issued an  aggregate  of  43,321,186  shares of
restricted  common  stock at a price of $0.075 per share,  the fair value of the
shares,  for $500,000 in cash and the  reduction of principle of  $1,499,090  of
notes payable and $1,250,000 of notes payable to  stockholders.  No gain or loss
has been recognized on these  transactions as the fair value of the stock issued
was equal to the consideration given by the shareholders.  The Company used the
$500,000 cash as working capital.

NOTE 6 - STOCK OPTIONS AND WARRANTS

Employee  Grants - During March 2002,  the Company  granted  options to purchase
5,000,000 shares of common stock to certain employees of the Company pursuant to
the 2001 Plan.  These options vested on the date of grant.  The related exercise
price for the  options  was  $0.045 to $0.05 per  share,  the fair  value of the
Company's  common  stock on the  dates of grant.  The  options  are  exercisable
through  September  2006.  The employees  exercised  all  5,000,000  options for
$235,000 cash during the first quarter.

The Company  granted  options to purchase  2,500,000  shares of common  stock at
$0.03 per share to an employee in July 2002.  These options  vested  immediately
and expire in September  2006.  The  Company's  common stock had a fair value of
$0.04 per share at the time these options were granted. Compensation relating to
these options of $25,000 or $0.01 per share was recognized at the time of grant.
The employee exercised all 2,500,000 options for $25,000 in cash and a $25,000
subscription receivable.  The subscription receivable was collected in October
2002.

NOTE 7 - SEGMENT INFORMATION

Segment  information  has  been  prepared  in  accordance  with  SFAS  No.  131,
"Disclosure  About  Segments  of an  Enterprise  and Related  Information."  The
Company  has  two  reportable   segments;   electronics  assembly  and  Ethernet
technology.  The electronics assembly segment manufactures and assembles circuit
boards and electronic  component cables. The Ethernet technology segment designs
and  manufactures  Ethernet cards.  The accounting  policies of the segments are
consistent  with  those  described  in the  summary  of  significant  accounting
policies in the Company's Annual Report on Form 10KSB/A.  The Company  evaluates
performance of each segment based on earnings or loss from operations.  Selected
segment information is as follows:



                                       11
<PAGE>



<TABLE>
<CAPTION>
                                                                            Electronics           Ethernet
               September 30, 2002                                             Assembly            Technology        Total
<S>                                                                     <C>                  <C>                  <C>
               Sales to external customers                              $      1,547,594     $       433,509      $     1,981,103
               Intersegment sales                                                179,451                  --              179,451
               Segment loss                                                   (1,157,244)           (142,593)          (1,299,837)
               Segment assets                                                  2,577,129             333,235            2,910,364
               Depreciation and amortization                                     352,674              15,703              368,377

               September 30, 2001
               Sales to external customers                              $      1,161,578     $       383,442      $     1,545,020
               Intersegment sales                                                262,832                  --              262,832
               Segment loss                                                   (2,159,721)              8,017           (2,151,704)
               Segment assets                                                  3,513,381             476,454            3,989,835
               Depreciation and amortization                                     363,269              11,522              374,791
</TABLE>



<TABLE>
<CAPTION>
                                                                                                         September 30,
                Sales                                                                              2002                2001

<S>                                                                                          <C>                  <C>
                Total sales for reportable segments                                          $     2,160,554      $     1,807,852
                Elimination of intersegment sales                                                   (179,451)            (262,832)

                Consolidated net sales                                                       $     1,981,103      $     1,545,020

                Net Loss

                Net loss for reportable segments                                             $    (1,299,837)     $    (2,151,704)
                Elimination of intersegment losses                                                        --                   --

                                                                                             $    (1,299,837)     $    (2,151,704)
</TABLE>

All  intersegment  sales are  recorded at the carrying  value of the goods.  The
carrying  value includes  materials,  labor and overhead.  Therefore,  the sales
result in no intersegment gain or loss.

<TABLE>
<CAPTION>
                                                                                             September 30, December 31,
                Total Assets                                                                       2002                2001

<S>                                                                                          <C>                  <C>
                Total assets for reportable segments                                         $     2,910,364      $     3,587,286
                Adjustment for intersegment amounts                                                   (9,098)              (1,800)

                Consolidated total assets                                                    $     2,901,266      $     3,585,486
</TABLE>

NOTE 8 - SUBSEQUENT EVENTS

On November 5, 2002, the Company entered into an Equity Line of Credit Agreement
(the  "Equity  Line  Agreement")  with a  private  investor  (the  "Equity  Line
Investor").  Under the Equity Line Agreement,  the Company has the right to draw
up to $5,000,000 from the Equity Line Investor  against an equity line of credit
(the  "Equity  Line"),  and to put to the  Equity  Line  Investor  shares of the
Company's common stock in lieu of repayment of the draw. The number of shares to
be issued is determined by dividing the amount of the draw by the lowest closing
bid price of the  Company's  common  stock over the five  trading days after the
advance  notice is tendered.  The maximum  amount of any single draw is $85,000.


                                       12
<PAGE>

The Equity Line Investor is required  under the Equity Line  Agreement to tender
the  funds   requested  by  the  Company  within  two  trading  days  after  the
five-trading-day period used to determine the market price.

In connection with the Equity Line Agreement,  the Company granted  registration
rights to the Equity  Line  Investor,  in  connection  with which the Company is
required to use its best efforts to file a  registration  statement  and have it
declared  effective by the Securities and Exchange  Commission.  The Company has
not yet filed such registration statement.  The Company is unable to draw on the
Equity Line until the registration statement has been declared effective.

                                       13
<PAGE>

ITEM 2.   MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
          RESULTS OF OPERATIONS

Forward-looking statements

All statements  made herein,  other than  statements of historical  fact,  which
address  activities,  actions,  goals,  prospects,  or new developments that the
Company expects or anticipates  will or may occur in the future,  including such
things as  expansion  and  growth of  operations  and other  such  matters,  are
forward-looking statements. Any one or a combination of factors could materially
affect the Company's operations and financial  condition.  These factors include
competitive  pressures,  success or failure of  marketing  programs,  changes in
pricing and availability of parts inventory, creditor actions, and conditions in
the capital markets. Forward-looking statements made by the Company are based on
knowledge of the  Company's  business and the  environment  in which the Company
currently  operates.  Because  of the  factors  listed  above,  as well as other
factors  beyond the Company's  control,  actual results may differ from those in
the forward-looking statements.

Overview

We  provide a mixture  of high and  medium  size  volume  turnkey  manufacturing
services   using   surface   mount   technology,   ball-grid   array   assembly,
pin-through-hole  and custom  injection  molded cabling for leading  electronics
OEMs in the communications,  networking, peripherals, gaming, consumer products,
telecommunications,  automotive,  medical,  and  semiconductor  industries.  Our
services  include   pre-manufacturing,   manufacturing  and   post-manufacturing
services. Through our subsidiary,  Racore Technology Corporation,  we design and
manufacture  Ethernet  technology  products.  Our goal is to offer customers the
significant  competitive  advantages  that  can  be  obtained  from  manufacture
outsourcing,  such as access to advanced manufacturing  technologies,  shortened
product  time-to-market,  reduced  cost  of  production,  more  effective  asset
utilization, improved inventory management, and increased purchasing power.

Critical Accounting Policies

We considered the disclosure  requirements of Financial Reporting Release No. 60
regarding critical  accounting  policies and Financial  Reporting Release No. 61
regarding  liquidity  and capital  resources,  certain  trading  activities  and
related  party/certain other disclosures,  and concluded that nothing materially
changed during the quarter that would warrant  further  disclosure  beyond those
matters previously  disclosed in our Annual Report on Form 10-KSB/A for the year
ended December 31, 2001.

Results of Operations

         Sales and Cost of Sales

Net sales for the three-month  period ended September 30, 2002,  decreased 22.4%
to $367,755,  as compared to net sales of $474,055  during the same  three-month
period in 2001.  the  Company  believes  that this  decrease  is a result of the
current  downturn in the economy in general.  The Company has not lost any major
customers,  but orders from those  customers are down compared to the comparable
period.  Net sales for the nine-month  period ended September 30, 2002 increased
28.2% to  $1,981,103,  from  $1,545,020  during  the same  period in 2001.  This
increase  resulted from increased  sales to existing  customers  including Tempo
Research,  General Cable,  Merit Optical,  and Silicon  Graphics,  as well as an
increase in slaes to new costomers including Sarcom, Digicon, and GTSI.



                                       14
<PAGE>

Cost of sales during the  three-month  period  ended  September  30,  2002,  was
$358,869,  as compared to $499,772 during the same period in 2001. Cost of sales
during the  nine-month  period  ended  September  30,  2002 was  $1,735,380,  as
compared to  $1,794,854  during the same  nine-month  period in 2001.  Our gross
profit percentage for the three-month  period ended September 30, 2002 was 2.4%,
as  compared to (5.4)%  during the same  three-month  period in 2001.  Our gross
profit  percentage for the nine-month period ended September 30, 2002 was 12.4%,
as compared to (16.2)% during the same nine-month period in 2001.  The gross
profit for the three and nine-month periods ended September 30, 2002, has
increased as a ersult of the Company's effort to solicit higher margin business.

During 2002, the Company has gradually shifted its business strategy from
transactions involving high volume, low margin sales to transaction more likely
to result in lower volume and higher margins. Although this transition started
slowly, the Company has begun to realize the benefits of the new strategy.


         Selling, General and Administrative Expenses

During the  three-month  period ended September 30, 2002,  selling,  general and
administrative  expenses  were  $516,650,  as compared to $393,368  for the same
period in 2001,  representing a 23.9%  increase.  This increase results, in
part, from the Company's increase in the size of its sales staff, an increase in
the commission structure for the sales staff, and the Company's efforts to
market its products more aggressively during a period of economic downturn.
During the  nine-month  period ended  September 30, 2002,  selling,  general and
administrative  expenses were  $1,400,240,  as compared to  $1,238,036,  a 13.1%
increase.  Due to an increase  in sales and a decrease  in selling,  general and
administrative  expenses,  the amount of such  expenses as a percentage of sales
decreased  80.1% for the nine months ended  September  30, 2001 to 70.7% for the
nine months ended September 30, 2002.

         Interest Expense

Interest  expense  for the  three-month  period  ended  September  30,  2002 was
$41,865,  compared to  $124,452  for the same  period in 2001,  a  reduction  of
$82,587,  or 66.4%.  Interest expense for the nine-month  period ended September
30, 2002 was  $282,609,  compared to $667,959  during the same period in 2001, a
reduction of $385,350,  or 57.7%. These decreases are primarily  attributable to
conversion  of a  significant  amount of debt to equity in January 2002 and to a
decrease in delinquent payroll tax penalties,  which were previously recorded as
part of interest expense.  As of September 30, 2002, the amount of our liability
for  delinquent  state and federal  payroll  taxes and  estimated  penalties and
interest thereon was $2,219,709. See "Part II - Item 1 - Legal Proceedings."

As a result  of the above  factors,  our  overall  net loss  decreased  39.6% to
$1,299,837 for the nine-month  period ended  September 30, 2002, from $2,151,704
for the same  period  in 2001.  Our net loss for the  three-month  period  ended
September 30, 2002  increased by 5.7% to $574,532,  as compared to a net loss of
$543,512 for the same period in 2001.

Liquidity and Capital Resources

Our expenses are currently  greater than our revenues.  We have had a history of
losses.  Our net loss from operations for the nine-month period ending September
30, 2002 was  $1,299,837,  and our net loss from  operations for the year ending
December 31, 2001 was  $2,933,084.  Our  accumulated  deficit was $14,380,329 at
September  30,  2002 and was  $13,080,492  at  December  31,  2001.  Our current
liabilities  exceeded our current assets by $5,448,391 at September 30, 2002 and
by  $7,832,259  as of December 31, 2001.  We recorded  negative  cash flows from
operations  for the  nine-month  period  ending  September 30, 2002 and the year
ended December 31, 2001 of $914,037 and $288,724, respectively.

         Cash

On September 30, 2002, we had $882 cash on hand, as compared to $499 at December
31, 2001.  The amount of checks written in excess of cash in bank decreased from
$159,964 at December 31, 2001 to $123,268 at September 30, 2002.



                                       15
<PAGE>

Net  cash  used in  operating  activities  was  $914,037  for the  period  ended
September 30, 2002, compared to $133,478 for the nine months ended September 30,
2001.  During  the nine  months  ended  September  30,  2002,  net cash  used by
operations was primarily  attributable to our net loss of $1,299,837,  decreases
in accounts payable of $547,727,  and payments of $152,500 made in settlement of
litigation,  offset by a decrease in trade  accounts  receivable of $244,442 and
non-cash charges of $368,376 for depreciation and amortization.

Net cash used in investing activities during the nine months ended September 30,
2002  and  2001,   consisted  of  equipment  purchases  of  $2,822  and  $1,844,
respectively.  Net cash provided by financing  activities  during the nine-month
period ended  September 30, 2002,  was $917,242.  Cash proceeds of $500,000 from
the issuance of  restricted  common  stock,  $285,000 from the issuance of stock
upon exercise of stock options,  and $655,000 from long-term  notes payable were
offset by principal payments of $348,402 on long-term notes payable, $140,125 on
notes  payable to  stockholders  and a $36,696  decrease in the dollar amount of
checks written in excess of cash in bank.

Noncash investing and financing activities during the period ended September 30,
2002 consisted of reclassifying  $345,263 from notes payable to accounts payable
(see below under "Accounts  Payable"),  the  cancellation of $1,250,000 in notes
payable to stockholders in exchange for issuance of restricted common stock, the
cancellation  of  $1,499,090  in notes  payable in exchange  for the issuance of
restricted   common   stock   (see  below   under   "Liquidity   and   Financing
Arrangements"),  and the  allocation of $120,000 to be paid for legal fees which
Abacas Ventures,  Inc.  ("Abacas"),  agreed to deduct as an offset of the amount
the Company owes Abacas. See "Liquidity and Financing Arrangements," below.

         Accounts Receivable

By September 30, 2002,  accounts receivable had decreased to $158,807 (net of an
allowance for doubtful accounts of $32,317),  as compared to accounts receivable
of $369,250 at December 31, 2002 (net of an allowance  for doubtful  accounts of
$66,316).  This significant decrease in accounts receivable is reflective of our
increased collection efforts.

         Accounts Payable

Accounts  payable  were  $1,297,281  at  September  30,  2002,  as  compared  to
$2,141,290  at December 31, 2001.  This  decrease is primarily  attributable  to
payments to vendors from $500,000 in cash provided by the issuance of restricted
common stock in January 2002 and the conversion of $345,263 of accounts  payable
to notes payable to Abacas Ventures, Inc., offset by increases in trade payables
incurred in conjunction with our increased sales.

         Liquidity and Financing Arrangements

We sustained  losses from  operations of $1,179,517  and $1,682,870 for the nine
months  ended  September  30,  2002  and  2001,  respectively  and  losses  from
operations  of $532,764 and $614,085 for the quarters  ended  September 30, 2002
and  2001,  respectively.   We  had  accumulated  deficits  of  $14,380,329  and
$13,080,492 at September 30, 2002 and December 31, 2001, respectively, and total
stockholders'  deficits of $4,658,124 and $6,942,377,  respectively,  as of such
dates.  As of December  31,  2001,  our  monthly  operating  costs and  interest
expenses  averaged  approximately  $205,000 per month. As of September 30, 2002,
this amount had decreased to approximately $145,000 per month.



                                       16
<PAGE>

Since  February  2000, we have  operated  without a line of credit.  Abacas,  an
entity whose  shareholders  include the Saliba Private Annuity Trust, one of our
major shareholders, and a related entity, the Saliba Living Trust, purchased our
line of credit of $2,792,609,  and this amount was converted into a note payable
to Abacas  bearing an interest  rate of 10%. As of December 31, 2001, a total of
$2,405,507,  plus $380,927 in accrued  interest,  was owed to Abacas pursuant to
this note payable.  In January 2002, we entered into  agreements with the Saliba
Private Annuity Trust and the Saliba Living Trust to exchange  19,987,853 shares
of our common stock for $1,499,090 in principal amount of this debt and to issue
an additional 6,666,665 shares to these trusts for $500,000 cash.  We used the
cash proceeds of the sale as working capital.

In January 2002, in addition to the above-described transactions with the Saliba
trusts,  we also issued  16,666,666 shares of restricted common stock at a price
of $0.075 per share in exchange  for the  cancellation  of  $1,250,000  of notes
payable to two other stockholders.

During the nine-months ended September 30, 2002,  Abacas completed  negotiations
with several of our vendors,  whereby Abacas purchased  various past due amounts
for goods and services provided by vendors, as well as capital leases. The total
of these  obligations was $345,263.  In addition,  Abacas agreed to deduct as an
offset of the amount owed to Abacas  $120,000,  constituting the amounts paid by
the Company as legal fees  incurred  by the Company as part of its  negotiations
with the Company's vendors.  We recorded this transaction as a $345,263 non-cash
increase to the note payable owed to Abacas, pursuant to the terms of the Abacas
agreement.  In  addition,  as partial  payment of the amount owed to Abacas,  we
agreed to pay $120,000 in legal fees of Abacas that were incurred as part of its
negotiations  with our vendors,  which amount was recorded as a non-cash payment
to the note payable owed to Abacas.

Additionally,  we  entered  into a  bridge  loan  agreement  with  Abacas.  This
agreement  allows us to request  funds from  Abacas to finance  the  build-up of
inventory  relating to specific sales. The advances bear interest at 24% and are
payable on demand.  The principal balance cannot exceed $600,000 at any point in
time.  Management  believes  that  this  bridge  loan/purchase  order  financing
arrangement is as fair to the Company as could have been made with  unaffiliated
third parties. During the nine months ended September 30, 2002, we were advanced
$655,000 and made cash  payments of $156,258 for an  outstanding  balance on the
bridge loan of $498,742.  The total principal  amount owed to Abacas between the
note payable and the bridge loan was $1,547,397 as of September 30, 2002.

The Company intends to continue to work with Abacas to explore various options
to reduce the Company's obligations to Abacas, including the issuance of shares
or cash payments. The Company enjoys a good working relationship with Abacas and
will work to continue to develop this relationship.

Despite our efforts to make our debt-load more serviceable,  significant amounts
of  additional  cash will be needed to reduce our debt and fund our losses until
such time as we are able to become profitable.  As at December 31, 2001, we were
in default of notes payable  whose  principal  amount,  not including the amount
owing to Abacas,  exceeded $666,000. In addition,  the principal amount of notes
that either mature in 2002 or are payable on demand exceed $1,157,656. The total
amount  per  month  that  we  have  committed  to  paying  pursuant  to  various
settlements for  outstanding  debt,  litigation and delinquent  payroll taxes is
currently approximately $42,000, all of which is against accrued liabilities and
notes  payable.  None  of  these  settlements,  however,  have  resulted  in the
forgiveness of any amounts owed, but have simply resulted in a restructuring  in
the terms of the various debts.

Management believes that each of the related party transactions were as fair to
the Company as could have been made with unaffiliated third parties.

In conjunction with our efforts to improve our results of operations,  discussed
above,  on November 5, 2002, we entered into an Equity Line of Credit  Agreement
(the  "Equity Line  Agreement")  with Cornell  Capital  Partners,  LP, a private
investor ("Cornell"). Under the Equity Line Agreement, we have the right to draw
up to  $5,000,000  from  Cornell  against an equity line of credit (the  "Equity
Line"), and to put to Cornell shares of our common stock in lieu of repayment of
the draw. The number of shares to be issued is determined by dividing the amount


                                       17
<PAGE>

of the draw by the lowest  closing  bid price of our common  stock over the five
trading days after the advance notice is tendered. Cornell is required under the
Equity Line  Agreement  to tender the funds  requested  by us within two trading
days after the five-trading-day period used to determine the market price.

Our  issuances  of  shares of our  common  stock  pursuant  to the  Equity  Line
Agreement  will  serve to dilute  the  value of our  common  stock and  existing
shareholders' positions.

                           PART II. OTHER INFORMATION

Item 1.      Legal Proceedings

As of September 30, 2002, we had accrued liabilities in the amount of $2,219,709
for  delinquent  payroll  taxes,  including  interest  estimated at $281,689 and
penalties estimated at $264,249. Of this amount,  approximately $301,980 was due
the State of Utah.  During the first  quarter of 2002,  we  negotiated a monthly
payment  schedule of $4,000 to the State of Utah,  which did not provide for the
forgiveness of any taxes, penalties or interest. These monthly payments were not
made during the third quarter.  Approximately $1,906,790 is owed to the Internal
Revenue  Service  ("IRS").  During the first  quarter of 2002,  we  negotiated a
payment schedule with respect to this amount, pursuant to which monthly payments
of $25,000  were  required.  In addition,  we  committed  to keeping  current on
deposits of federal withholding amounts. The required monthly payments were made
during each of the three months during the second  quarter.  None of the monthly
payments were made during the third  quarter,  and the Company is  renegotiating
the payment schedule with the IRS. In addition,  we failed to pay several of our
current withholding  obligations.  Approximately $10,939 is owed to the State of
Colorado.

The amounts in controversy in the matters described in the following  paragraphs
have all been included in the Company's  financial  statements and notes, and do
not represent obligations or contingencies in addition to those set forth in the
financial statements and notes.

Sunborne XII, LLC - The Company (as successor to Circuit Technology, Inc.) was a
defendant in an action in El Paso County,  Colorado  District Court,  brought by
Sunborne XII, LLC, a Colorado limited liability company, for alleged breach of a
sublease agreement  involving  facilities located in Colorado.  Our liability in
this  action  was  originally  estimated  to  range up to $2.5  million,  and we
subsequently  filed a counter  suit in the same  court  against  Sunborne  in an
amount exceeding $500,000 for missing equipment. Effective January 18, 2002, the
Company  entered into a settlement  agreement  with Sunborne with respect to the
above-described litigation. The settlement agreement required the Company to pay
Sunborne the sum of $250,000. Of this amount, $25,000 was paid upon execution of
the  agreement,  and the balance,  together with  interest at 8% per annum,  was
payable by July 18, 2002.  As security  for payment of the balance,  the Company
executed and  delivered to Sunborne a Confession  of Judgment and also issued to
Sunborne  3,000,000  shares of the Company's  common stock,  which are currently
held in  escrow  as  security  for  performance  of our  obligations  under  the
settlement  agreement.  We were also required, if 75% of the balance owing under
the  agreement  was not paid by May 18,  2002,  to  prepare  and  file  with the
Securities & Exchange  Commission,  at the  Company's  expense,  a  registration
statement  with  respect  to the  shares  that  were  escrowed.  The  settlement
agreement also  stipulated that if such  registration  was not completed by July
18, 2002 and the escrowed shares were not replaced with registered  free-trading
shares  pursuant  to the  terms  of  the  agreement,  Sunborne  could  file  the
Confession of Judgment and proceed with execution thereon.



                                       18
<PAGE>

Pursuant to a Termination of Sublease  Agreement  dated as of May 22, 2002 among
the Company,  Sunborne and other  parties,  the sublease  agreement that was the
subject  of our  litigation  with  Sunborne  was  terminated  and a  payment  of
approximately  $109,000 was  credited  against the amount owed by the Company to
Sunborne under the Company's  settlement agreement with them. Sunborne has filed
a claim that this  amount was to be an  additional  rent  expense  rather than a
payment on the note  payable.  The  Company  disputes  this claim and intends to
vigorously defend the action.

As of November 12, 2002, the Company was in default of its obligations under the
settlement  agreement with Sunborne,  i.e., the total payment due thereunder had
not been made, a registration  statement with respect to the escrowed shares was
not filed,  and the Company did not replace the escrowed shares with registered,
free-trading shares as per the terms of the agreement. Accordingly, Sunborne has
filed the  Confession  of Judgment and proceeded  with  execution  thereon.  The
Company  is  currently  negotiating  with  Sunborne  in an attempt to settle the
remaining obligation under the settlement agreement.

Osicom  Settlement - On July 31, 2002, the Company entered into a Mutual Release
and Settlement Agreement (the "Osicom Agreement") with Osicom Technologies,  Inc
and Entrada  Networks,  Inc. In January 2001,  the Company had filed a breach of
contract action against Osicom, one the Company's customers,  seeking damages of
$875,000 in respect of  Osicom's  cancellation  of a portion of a  manufacturing
contract.  Pursuant to the terms of the Osicom Agreement, The Company has agreed
to dismiss its claims against Osicom and Entrada in  consideration  for a series
of six  payments  by Entrada to the  Company in  August-October  2002 that total
$265,000.  As part of the settlement,  the Company returned  inventory valued at
$158,010,  settled  receivables  from the customer of 287,277,  settled payables
owed to the customer in the amount of $180,287  and sold  inventory to a company
related to the  customer  for  $13,949.  At  September  30, 2002 the Company had
received  $185,000.  Subsequent  to  September  30, 2002,  the final  payment of
$80,000 had been collected.

Arrow Electronics v. Circuit Technology Corporation,  Civil No. 990409504, Third
Judicial District Court, Sandy Department, Salt Lake County, State of Utah. Suit
was brought against the Company on or about October 19, 1999, under  allegations
that the Company  owes  $199,647.92  for  materials  and services and terms of a
promissory  note. The Company has answered,  admitting that it owed certain sums
and denying all other  claims.  The Company and Arrow have  entered a settlement
agreement  under  which the  Company  will pay  $6,256.24  each month  until the
obligation  and  interest  thereon are paid.  The Company has  defaulted  on its
payment  obligations  under the settlement  agreement.  The Company is currently
negotiating a new settlement agreement.

Avnet  Electronics  has  notified  the  Company  that it believes it has a claim
against  the  Company  in the  amount  of  $180,331.02  for the cost of goods or
services  provided to the Company for the Company's use and benefit.  No lawsuit
has been filed.  Negotiations  for  settlement of this claim have resulted in an
agreement  in  principal  whereby the Company  will make a cash  payment to this
creditor  and  issue a  promissory  note  and its  restricted  common  stock  in
satisfaction of the creditor's claims. The parties are presently negotiating the
terms of the settlement documents.  However,  until the settlement documents are
executed and delivered,  there can be no assurance  that the  creditor's  claims
will be settled or that the terms will be favorable to the Company.

CirTran Corp. v. Entrada Networks,  Inc. et al., Case No.  2:01-CV-142B,  United
States District Court,  District of Utah. On January 19, 2001, the Company filed


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<PAGE>

suit in  state  court  seeking  to  recover  $874,653  in  actual  damages  plus
unspecified  consequential  damages and attorneys' fees. The Company claims that
Entrada,  and  Entrada's  predecessor-in-interest,  breached  its  contracts  to
purchase  goods from the Company.  Entrada  removed the case to federal court in
Salt Lake City,  Utah,  and filed a motion to dismiss the complaint on the basis
of lack of personal jurisdiction.  The court denied Entrada's motion to dismiss.
Entrada  asserted a claim  against the Company for  unspecified  amount based on
alleged  defects that Entrada claims to have found in the goods that the Company
assembled.  Subsequently,  the  Company and Entrada  entered  into a  settlement
agreement whereby Entrada paid the Company approximately $250,000, and agreed to
order and pay for certain  parts from Orbit  Systems,  Inc. (see below) over the
next three months.

Future  Electronics  Corp  adv.  Circuit  Technology   Corporation,   Civil  No.
000900296,  Third Judicial District Court, Salt Lake County, State of Utah. Suit
was brought against the Company on or about January 12, 2000, under  allegations
that the Company owed $646,283.96 for the cost of goods or services  provided to
the Company for the Company's  use and benefit.  Claims were asserted for breach
of contract,  fraud,  negligent  misrepresentation,  unjust enrichment,  account
stated and dishonored instruments. The Company answered the complaint, admitting
that it owed  certain  sums for  conforming  goods and  services and denying all
other claims.  Partial Summary Judgment was entered in the amount of $646,783.96
as to certain claims against the Company.  Negotiations for settlement  resulted
in an  agreement  for  settlement  of all claims of Future  against  the Company
subject to  performance  by the Company  under the  agreement.  The Company also
issued to Future 352,070 shares of its restricted common stock.

Infineon  Technologies North America Corp. v. Circuit  Technology,  Inc. et al.,
Case No. CV 792634,  Superior Court of the State of California,  County of Santa
Clara. Judgment was entered against Circuit Technology, Inc., on March 12, 2002,
in  the  amount  of   $181,342.15.   The  Company  is  currently  in  settlement
negotiations with Infineon.

John J. La Porta v. Circuit Technology,  Inc. et al., Case No. 010900785,  Third
Judicial District Court, Salt Lake Department,  Salt Lake County, State of Utah.
La Porta  filed suit on or about  January  23,  2001,  seeking  to  recover  the
principal  sum of $135,941  plus  interest on a promissory  note given by Racore
Technology  Corp.  La  Porta  claims  that the  Company  is a  guarantor  of the
promissory  note and the  Company  should be held  liable  because  of  Racore's
default on the note. The parties are presently negotiating settlement.  However,
until the  settlement is reached,  there can be no assurance that the creditor's
claim will be settled nor that the terms will be favorable to the Company.

Orbit Systems,  Inc. v. Circuit  Technology,  Inc. et al, Case No.  010100050DC,
Third Judicial  District Court,  West ValleyCity  Department,  Salt Lake County,
State of Utah. Orbit filed suit on January 4, 2001,  seeking to recover $173,310
for the costs of goods  that  Orbit  claims the  Company  is under  contract  to
purchase.  The Company filed an answer denying the  substantive  allegations and
filed a Third-party  Complaint  against Osicom  Technologies,  Inc., and Entrada
Networks,  Inc., for contribution,  indemnity and reimbursement in the event the
Company  is held  liable to  Orbit.  The  Company  subsequently  entered  into a
settlement  agreement  with Entrada  whereby  Entrada paid certain  funds to the
Company  and agreed to order and pay for certain  parts from Orbit.  The Company
also entered into an agreement with Orbit to the effect that if Entrada fulfills
its obligations to purchase and pay for the parts from Orbit, Orbit will release
its claims against the Company.

Sager Electronics v. Circuit Technology Corporation,  Civil No. 000403535, Third
Judicial District Court, Sandy Department, Salt Lake County, State of Utah. Suit
was brought  against the Company on or about March 23, 2000,  under  allegations


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<PAGE>

that the Company owed  $97,259.23 for the cost of goods or services  provided to
the  Company  for the  Company's  use  and  benefit.  Claims  are  asserted  for
nonpayment of amount owing.  The Company has  answered,  admitting  that it owed
certain sums for  conforming  goods and  services and denying all other  claims.
Negotiations  for settlement have resulted in an agreement for settlement of all
claims of Sager against the Company.  The Company has arranged  certain payments
and is required to pay Sager  $1,972.07  each month until paid.  The Company has
defaulted on its payment obligations under the settlement agreement. The Company
is currently negotiating a new settlement agreement.

SuhTech  Electronics adv. Circuit  Technology  Corporation,  Civil No. 00L14505,
Circuit Court of Cook County Department,  Law Division,  State of Illinois. Suit
was brought against the Company on or about December 23, 1999, under allegations
that the Company owed $213,717.70 for the cost of goods or services  provided to
the Company for the Company's use and benefit. Claims are asserted for breach of
contract,  unjust  enrichment  and account  stated.  The  Company has  answered,
admitting  that it owed  certain  sums for  conforming  goods and  services  and
denying all other  claims.  The parties are presently  negotiating  the terms of
settlement.  However, until the settlement documents are executed and delivered,
there can be no assurance that the creditors  claims will be settled or that the
terms will be favorable to the Company.

Wells Fargo  Equipment  Finance v.  Circuit  Technology  Corporation,  Civil No.
901207, Third Judicial District Court, Salt Lake County, State of Utah. Suit was
brought  against the Company on or about  February 10, 2000,  under  allegations
that the Company  owed  $439,493,56  for a loan  provided to the Company for the
Company's use and benefit. Claims are asserted for breach of contract, breach of
guarantee,  and  replevin.  The Company  has  answered,  admitting  that it owed
certain sums for  conforming  goods and  services and denying all other  claims.
Judgment  has been  entered  against the Company and certain  guarantors  in the
amount of $427,291.69 plus interest at the rate of 8.61% per annum from June 27,
2000. The Company has  subsequently  made payments to Wells Fargo,  reducing the
obligation  to  $273,089,   plus   interest   accruing  from  January  1,  2002.
Negotiations for settlement of the remaining claims are underway.

Zion's  First  National  Bank has notified the Company that it believes it has a
claim  against  the Company in the amount of  $240,000.00  for loans made to the
Company for the Company's use and benefit.  The Company has entered into a Fifth
Forbearance  and Loan  Modification  Agreement,  requiring  monthly  payments of
$20,000.00.  The Company is currently  negotiating  with this creditor to settle
any remaining claims.

George  M.  Madanat,  Civil  No.  KC  035616,  Superior  Court  of the  State of
California  for the  County of Los  Angeles,  East  District.  Suit was  brought
against  the  Company on or about  April 2,  2001,  under  allegations  that the
Company owed $121,824.90 under the terms of a promissory note. A Stipulation for
Settlement  and for Entry of Judgment  was  executed by the parties  wherein the
Company  agreed to arrange for  payment of a principal  amount of $145,000 in 48
monthly  installments.  The Company made seven  payments and then failed to make
subsequent  payments,  at which time Mr.  Madanat  obtained  a consent  judgment
against the Company.  The Company is currently in settlement  negotiations  with
Mr. Madanat regarding the judgment.

Abacas Ventures,  Inc.,  ("Abacas") is a Delaware  corporation which is owned by
private  individuals,  some of whom are also affiliates and  shareholders of the
Company.  The  Company  does  not  know  the  identity  of  all  of  the  Abacas
shareholders.  It is the  Company's  understanding  that Abacas has acquired the
claims and rights of certain creditors of the Company. There may be other claims
acquired by Abacas of which the Company is not aware.  The Company is unaware of
the  full  amount  of  Abacas'  claims  against  the  Company.  The  Company  is
negotiating with Abacas to settle and resolve the claims.



                                       21
<PAGE>

In addition to the above specified claims,  the Company is currently involved in
at least four lawsuits  which  individually  are not deemed to be material,  the
aggregate claims in which are approximately  $127,250. The Company is attempting
to settle  these suits and claims,  but there is no  guarantee  that the Company
will be able to settle such claims.

Item 2.      Changes in Securities

         Recent Sales of Unregistered Securities

Pursuant to an Equity Line of Credit Agreement  (discussed  above),  the Company
will put to the Equity Line  Investor,  in lieu of repayment of amounts drawn on
the Equity Line,  shares of the  Company's  common  stock.  Although the Company
plans to file a registration statement to register the resale by the Equity Line
Investor of the shares put to it by the Company,  the issuances of shares to the
Company will be made in reliance on Section 4(2) of the  Securities  Act of 1933
as a transaction  not involving any public  offering.  No advertising or general
solicitation  was  employed in offering the  securities,  and the shares will be
issued to only one  investor  which has  represented  that it is an  "accredited
investor" as that term is defined in  Regulation D  promulgated  pursuant to the
Securities Act of 1933.

Item 6.      Exhibits and Reports on Form 8-K

         Reports on Form 8-K: The following reports on Form 8-K were filed by us
during the three-month period ended September 30, 2002:

(i)        Form 8-K filed November 12, 2002 with respect to our entering into
           the Equity Line of Credit Agreement.

           Exhibits:

         99.1        Certifications

         99.2        Certification Pursuant to 18 U.S.C. Section 1350, as
                     Adopted Pursuant to Section 906 of the Sarbanes-Oxley
                     Act of 2002



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<PAGE>

                                   SIGNATURES

In accordance  with the Securities  Exchange Act of 1934, the registrant  caused
this  report to be  signed  on its  behalf  by the  undersigned  thereunto  duly
authorized.


                                         CIRTRAN CORPORATION

Date:   January 22, 2003                 By: Iehab Hawatmeh
                                              President




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