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

                                                     FORM 10-Q

[X ] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
      ACT OF 1934.

For the quarterly period ended September 30, 1996.

Commission File Number:                                 0-12661

Exact Name of Registrant as Specified in its Charter:   IMTEC, Inc.

State of Incorporation:                                 Delaware

I.R.S. Employer Identification Number:                  03-0283466

Address of Principal Executive Offices:                 One Imtec Lane
                                                        Bellows Falls, VT  05101

Registrant's Telephone Number:                          802-463-9502



         Indicate  by check  mark  whether  the  registrant  (1) has  filled all
reports  required to be filed by Section 13 or 15(d) of the Securities  Exchange
Act of 1934  during the  preceding  12 months (or for  shorted  period  that the
registrant was required to file such reports),  and (2) has been subject to such
filing requirements for the past 90 days. [X] YES [ ] NO





APPLICABLE ONLY TO CORPORATE ISSUERS:

         Indicate  the  number of  shares  outstanding  of each of the  issuer's
classes of common stock, as of the latest practicable date.

         Common shares outstanding as of October 29, 1996:   1,545,088



<PAGE>



                                   IMTEC, INC.

                                      INDEX

                                                                         Page #
Part I            Financial Information

                  Condensed Balance Sheets -
                       September 30, 1996 and June 30, 1996               3 - 4

                  Condensed Statements of Income -
                       Three Months Ended
                           September 30, 1996 and 1995                       5

                  Condensed Statements of Cash Flows
                       Three Months Ended
                           September 30, 1996 and 1995                       6

                  Notes to Condensed Financial Statements                 7 - 8

                  Management's Discussion and Analysis of
                       Financial Condition and Results of Operations         9

Part II  Other Information

         Item 2   Changes in Securities                                      11

         Item 4   Submission of Matters to a Vote of
                  Security Holders                                           11

         Item 6   Exhibits and Reports on Form 8-K                           11

         Signatures                                                          12



<PAGE>


                         PART I - FINANCIAL INFORMATION
                                   IMTEC, INC.
                            CONDENSED BALANCE SHEETS
<TABLE>
<CAPTION>

                                                              September 30,             June 30,
                                                                 1996                    1996  .
                                                                (Unaudited)                 *
ASSETS

Current Assets:
<S>                                                          <C>                       <C>       
     Cash                                                    $  782,533                $  806,633
     Marketable Securities                                       54,671                    54,671
     Accounts and notes receivable: Trade, less allowance for doubtful accounts:
              September 30, 1996 - $64,500
                  June 30, 1996 - $93,915                     1,165,010                 1,281,101

     Inventories                                              1,571,157                 1,512,037
     Prepaid expenses and deferred charges                      102,540                   134,650
     Income Tax Refundable                                                                 87,086
     Deferred income tax                                         96,330                    96,330
                                                            -----------                ----------

                  Total Current Assets                        3,772,241                 3,972,508
                                                           ------------              ------------

Plant and equipment                                           3,965,620                 3,569,012
Less: Accumulated depreciation                                2,692,203                 2,573,562
                                                           ------------              ------------
                                                              1,273,417                   995,450
                                                           ------------              ------------

Other Assets:
     Deposits                                                    54,667                   150,481
     Computer software less accumulated amortization
         of $407,034 in 1996 and $390,229 in 1996,               94,203                   109,008
     Other intangibles less accumulated amortization of,
         $466,952 in 1996 and $446,975 in 1996                  243,037                   211,638
                                                            -----------               -----------
                                                                391,907                   471,127
                                                            -----------               -----------


                                                           $  5,437,565              $  5,439,085
                                                              =========                 =========
* From audited financial statements.
</TABLE>

                         The  accompanying  notes are an integral  part of these
condensed financial statements.



<PAGE>
<TABLE>
<CAPTION>


                         PART I - FINANCIAL INFORMATION
                                   IMTEC, INC.
                      CONDENSED BALANCE SHEETS (CONTINUED)

                                                              September 30,             June 30,
                                                                 1996                    1996  .
                                                                (Unaudited)                 *
LIABILITIES AND STOCKHOLDERS EQUITY

Current Liabilities
<S>                                                   <C>                       <C>              
     Notes payable - bank                             $               0         $               0
     Current installments of long term debt                           0                         0
     Current capital lease obligations                                0                         0
     Accounts payable                                           213,174                   430,420
     Income tax payable                                          17,542                         0
     Accrued liabilities
         Salaries and wages                                     127,823                   176,276
         Commissions                                            204,766                    45,899
         Other                                                  346,154                   417,030
                                                            -----------              ------------
                  Total Current Liabilities                     909,459                 1,069,625

Long term debt less current installments                              -                         -
Long term capital lease obligations                                   -                         -
                                                      -----------------          ----------------
                                                                909,459                 1,069,625
                                                            -----------                ----------

Stockholder's equity:
     Common stock - $.01 par value;
         authorized 5,000,000 shares, issued and outstanding:
         1,545,088 shares September 30, 1996
         1,545,088 shares June 30, 1996                          15,451                    15,451
     Additional paid-in capital                               2,449,517                 2,449,517
Retained Earnings                                             2,063,138                 1,904,492
                                                            -----------               -----------

                  Total Stockholder's Equity                  4,528,106                 4,369,460
                                                            -----------               -----------

                                                           $  5,437,565              $  5,439,085
                                                               ========                  ========

* From audited financial statements.
</TABLE>

                         The  accompanying  notes are an integral  part of these
condensed financial statements.



<PAGE>

<TABLE>
<CAPTION>


                                   IMTEC, INC.
                         CONDENSED STATEMENTS OF INCOME
                                   (Unaudited)

                                               Three Months Ended
                                                   September 30,
                                               1996           1995
                                               ----           ----

<S>                                       <C>            <C>       
Net Sales                                 $2,100,143     $2,580,110
Cost of Sales                              1,038,799      1,426,444
                                         -----------    -----------

              Gross Profit                 1,061,344      1,153,666

Selling, general and
     administrative expenses                 667,334        686,739
Research and development
     expenses                                142,674        154,091
                                         -----------     ----------

              Operating Profit               251,336        312,836

Other Income (Expenses):
     Miscellaneous income
         and other expenses                   12,264         11,410
     Interest Expense

         Income (Loss) Before
              Income Taxes                   263,600        324,246
                                           ---------     ----------

Income Tax Expense                           104,954        128,613

     Net Income                          $   158,646     $  195,633
                                             =======        =======

Weighted average number of
     common shares and common
     shares equivalents outstanding        1,600,113     1,547,735

Earnings per common share and
     common share equivalents          $         .10  $        .13
                                             =======        =======
</TABLE>

                         The  accompanying  notes are an integral  part of these
condensed financial statements.


<PAGE>

<TABLE>
<CAPTION>

                                   IMTEC, INC.
                       CONDENSED STATEMENTS OF CASH FLOWS
                                   (Unaudited)
                                               Three Months Ended
                                                   September 30,
                                               1996           1995
                                               ----           ----
Cash flows from operating activities: 
<S>                                            <C>             <C>      
     Net Earnings                              $158,646        $195,633 
     Adjust, to reconcile net earnings to, 
     net cash provided by operating activities:
         Depreciation & amortization of
         property plant, equipment
         and other assets                       155,423         122,125

     Decrease(inc.) in accounts receivable      116,091         553,277
     Decrease(inc.) income tax refundable        87,086               0
     Decrease (inc.) in inventory               (59,120)        (36,408)
     Decrease (inc.) in prepaid expenses
         and other assets                       127,924         (22,211)
     Increase (dec.) in accounts payable       (217,246)       (258,596)
     Increase (dec.) in income tax payable       17,542          91,619
     Increase (dec.) in accrued liabilities      39,538        (190,561)
                                               --------        ---------
     Net cash provided by operating             425,884         454,878
Cash flows from (used in) investment activities:
     Expenditures for property & equipment,
         computer software and other
         intangible assets                     (449,984)       (196,507)
                                               --------        ---------
     Net cash used in invest. activities       (449,984)       (196,507)
Cash flows from (used in) financing activities:  
     Proceeds form issuance of notes
     Principal  notes  payable  to bank  
     Principal  payments  on long  term debt
     Principal payments under capital
         lease obligations
     Proceeds from issuance of stock                             27,501
                                              ---------       ---------
     Net cash provided by finance
         activities                                   0          27,501
                                              ---------       ---------
Net increase (decrease) in cash                 (24,100)        285,872
Cash at the beginning of period                 806,633         285,727
                                              ---------       ---------
Cash at the end of period                     $ 782,533       $ 571,599
                                              =========       =========
Supplemental Information Disclosures:
         Interest paid
         Income tax paid                                       $ 36,994

</TABLE>
                         The  accompanying  notes are an integral  part of these
condensed financial statements.

                                   IMTEC, INC.
                     NOTES TO CONDENSED FINANCIAL STATEMENTS
                                   (Unaudited)

1 -      Basis of Presentation

         The financial  information included herein is unaudited:  however, such
information  reflects all  adjustments  (consisting  solely of normal  recurring
adjustments)  which are,  in the  opinion of  management,  necessary  for a fair
statement of results for the interim periods.

         The results of  operations  for the three month period ended  September
30, 1996 are not  necessarily  indicative  of the results to be expected for the
full year.


2 -      Inventories

<TABLE>
<CAPTION>
         Inventories consist of:
                                                     September 30,          June 30,
                                                          1996                 1996

<S>                                                  <C>                  <C>       
Finished Products                                    $    21,175          $   39,299
Work in Process                                          128,580              97,310
Purchased Components                                   1,421,402           1,375,428
                                                     -----------         -----------
                                                       1,571,157           1,512,037
                                                        ========            ========
</TABLE>

         Inventory  cost  consisted  of the  cost of  purchased  components  and
supplies, manufacturing labor and manufacturing overhead.


3 -      Liability for Estimated Product Warranty

         On  September  30, 1996 and June 30,  1996,  the  Company had  provided
$125,460 and $119,954  respectively,  against future product warranties based on
its  experience  with  customer  claims.  Warranty  expenses  charged  to income
amounted to approximately $18,405 for the three month period ended September 30,
1996 and $32,812 for the three month period ended September 30, 1995.



<PAGE>



4 -      Earnings (Loss) per Common Share

         Primary  earnings  per share were  computed  by dividing  net  earnings
(loss) by the  weighted  average  number of shares of common  stock  equivalents
outstanding  during the year,  if  dilutive.  Common  stock  equivalents  (stock
options and warrants)  are assumed to be exercised  when they are issued and the
proceeds used to repurchase  outstanding shares of the Company's common stock at
the average price during the period.

         The fully-diluted computation is performed using the same method as for
the primary  computation,  except that the proceeds from exercised stock options
and  warrants  are assumed to be used to  repurchase  outstanding  shares of the
Company's  common  stock at the higher of the average or  September  30,  market
price.

         The  average  number  of  common  share and  common  share  equivalents
entering into the  calculation of primary and  fully-diluted  earnings per share
are as follows:

<TABLE>
<CAPTION>
                        Three months ended September 30,
                                    1996 1995

<S>                                                    <C>                 <C>      
Common shares                                          1,545,088           1,475,355
Options                                                   53,857              72,380
Warrants                                                      --                  --
                                                      ----------          ----------
         Total for primary calculation                 1,598,945           1,547,735
Options                                                    1,167                  --
Warrants                                                      --                  --
                                                      ----------          ----------        
         Total for fully-diluted calculation           1,600,113           1,547,735
                                                      ==========          ==========
</TABLE>



<PAGE>


                                   IMTEC, INC.
                MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
                       CONDITION AND RESULTS OF OPERATIONS

                      Three Months Ended September 30, 1996
              as compared to Three Months Ended September 30, 1995

         Revenues  for the three  months  ended  September  30,  1996  decreased
approximately 18.6% from the corresponding period in 1995.

         Revenues from Bar Code labels and printing supplies were $1,502,539 for
the quarter ended  September 30, 1996 compared to $1,174,939 for the same period
last year.  Bar Code labels and  printing  supplies  represented  71.5% of total
revenue for the three months ended  September 30, 1996 compared to 45.5% for the
same period last year.  Management  believes  that the upward  trend in Bar Code
labels and printing  supply sales are due to a stronger focus by the sales group
and expanded partnering and distribution relationships.

         Revenues from the sales of Industrial  Bar Code Equipment were $597,604
for the three months ended  September 30, 1996  compared to  $1,405,171  for the
same period in 1995.  Industrial Bar Code Equipment sales  represented  28.5% of
total  revenue for the three months ended  September  30, 1996 compared to 54.5%
for the same period last year. . The decrease in bar code equipment sales in the
three months ended  September 30, 1996,  when contrasted with the same period in
1995,  is primarily  attributable  to the  completion,  in October,  1995,  of a
contract  with a  single  customer.  When  this  contract  is  removed  from the
revenues,  the remaining equipment business increased 6.4% from $561,470 for the
three months ended  September  30, 1995 , to $597,604 for the three months ended
September 30, 1996.  Management believes that the upward trend in Industrial Bar
Code Equipment sales will continue due to expanded  partnering and  distribution
relationships, new product offerings and expanded use of technology. The machine
backlog,  exclusive of the single customer  mentioned  above, has increased from
$560,560 at September 30, 1995 to $774,246 at September 30, 1996.

         Cost of sales for the three months ended September 30, 1996 were 49.5%,
down from 55.4% for the same period in 1995.  This decrease is directly  related
to the product mix,  heavily  favoring the media products.  As discussed  above,
Media represented 71.5% of total revenue.

         Selling,  general and  administrative  expenses  were  $667,334 for the
quarter  ended  September 30, 1996 as compared to $693,229 for the quarter ended
September 30, 1995.  This  represents a 3.3% decrease in these  expenses.  Total
backlog as of September 30, 1996 was approximately  $1,927 ,000, all of which is
expected to be shipped by June 30, 1996, compared to approximately $1,425,000 as
of  September  30,  1995.  This  increase in backlog of orders is related to the
expanded partnering and distribution relationships discussed above..

         Development  and  engineering  expenses for the quarter ended September
30, 1996 were $142,674 (6.8% of sales)  compared to $154,091 (6.0% of sales) for
the same period last year.  These  expenditures  reflect  ongoing  commitment to
advancing the Company's technology and the efforts to bring several new products
to the market.

         Income tax expense is a direct  result of the  Company's  net income or
loss before taxes.

         Net income for the  quarter  ended  September  30,  1996  was  $158,646
compared to $195,626 for the quarter ended September 30, 1995.  The major reason
for this decrease is reduced revenues.

         As of September 30, 1996, the Company's  principal available sources of
liquidity  were,  respectively,  from  operations  and a  $700,000  bank line of
credit, all of which was available as of September 30, 1996.

         Accounts  receivable  decreased  from  $1,281,101  at June 30,  1996 to
$1,165,010  at September 30, 1996, a direct result of the increase in efforts to
encourage customers to pay within terms and lower sales revenues.

         Inventories  increased  slightly,  from  $1,512,037 at June 30, 1996 to
$1,571,157 at September 30, 1996.

         The Company's  capital  commitments  for fiscal 1997 are expected to be
approximately  50% above the level of  fiscal  1996.  This is the  result of the
Company's  commitment  to  improve  the  capability  and  capacity  of its label
operations.

         The  Company  believes  that it will be able to offset  the  effects of
inflation by selected price  increases in its products,  although it can give no
assurances in this regard.



<PAGE>



                           PART II - OTHER INFORMATION


Item 1 -      Legal Proceedings
              -----------------
              None

Item 2 -      Changes in Securities
              ---------------------
              Not  applicable

Item 3 -      Defaults Upon Senior Securities
              -------------------------------
              None

Item 4 -      Submission if Matters to a Vote of Security Holders
              ---------------------------------------------------
              Not applicable

Item 5 -      Information
              -----------
              None

Item 6 -      Exhibits and Reports on Form 8-K
              --------------------------------
              None



<PAGE>



                                   SIGNATURES


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

                                                                     IMTEC, INC.






                                        BY:____/s/ Richard L. Kalich___________
                                                  Richard L. Kalich
                                           President & Chief Executive Officer






                                        BY:____/s/ George S. Norfleet III______
                                                    George S. Norfleet III
                                                     Secretary / Treasurer