UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION

                             WASHINGTON, D.C. 20549

                                   FORM 10-QSB

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

                    For the Quarter ended September 30, 1998

        [   ]    TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF
                     THE SECURITIES AND EXCHANGE ACT OF 1934

                 For the transition period from ___________________

                           Commission File No. 0-12116

                           ComTec International, Inc.
                 (Name of Small Business Issuer in its charter)

         New Mexico                                                   75-2456757
         (State or other jurisdiction of                        (I.R.S. Employer
         incorporation or organization                       Identification No.)

            9350 East Arapahoe Road, Suite 340, Englewood, Co. 80112
                    (Address of principal executive offices)

                                 (303) 662-1198
                 (Issuer's Telephone Number Including Area Code)

                          Common Stock, $.001 par value
                          -----------------------------
                                (Title of Class)


former name, former address and former fiscal year if changed since last report)

     Check  whether  the issuer (1) filed all  reports  required  to be filed by
Section 13 or 15(d) of the  Exchange  Act during the past 12 months (or for such
shorter period that the  registrant was required to file such reports),  and (2)
has been subject to such filing requirements for the past 90 days.

                               Yes       No   x
                                   -----    -----
      ISSUERS INVOLVED IN BANKRUPTCY PROCEEDINGS DURING THE PAST FIVE YEARS

Check  whether the issuer has filed all  documents  and  reports  required to be
filed by Sections 12, 13 or 15(d) of the Exchange Act after the  distribution of
securities under a plan confirmed by a court.

                               Yes   x   No
                                   -----    -----

State the number of shares outstanding of each of the issuer's classes of common
equity, as of the latest practical date:

     As of July 20,  1999,  46,070,019  shares of Common Stock ($.001 par value)
were outstanding

           Transitional Small Business Disclosure Format (check one):
                                Yes       No   x
                                    -----    -----


<PAGE>



                                TABLE OF CONTENTS

            FORM 10-QSB REPORT - FOR QUARTER ENDED SEPTEMBER 30, 1998

                           ComTec International, Inc.

PART I

     Item 1.   Financial Statements
               Condensed Consolidated Balance Sheets -
               September 30, 1998 (unaudited) and June 30, 1998 (audited)      3

               Condensed Consolidated Statements of Operations                 4
               Three Months ended September 30, 1998 and 1997
               and  from inception (unaudited)

               Condensed Consolidated Statements of Cash Flows                 5
               Three Months ended September 30, 1998 and 1997
               and  from inception (unaudited)

               Notes to Financial Statements                                   6

     Item 2.   Management's Discussion and Analysis or Plan of Operation       7

PART II

     Item 1.   Legal Proceedings                                              11
     Item 2.   Change in Securities                                           12
     Item 3.   Defaults Upon Senior Securities                                12
     Item 4.   Submission of Matters to a vote of Security Holders            12
     Item 5.   Other Information                                              12
     Item 6.   Exhibit  and Reports on Form 8-K                               12

SIGNATURE PAGE                                                                13


                                       2
<PAGE>



                                     PART I

ITEM 1.           FINANCIAL STATEMENTS

<TABLE>
                   ComTec International, Inc. and Subsidiaries
                        (a Development Stage Enterprise)
                      Consolidated Condensed Balance Sheets

<CAPTION>
                                                    September 30, 1998   June 30, 1998
                                                        (unaudited)        (audited)
                                                       ------------       ------------
<S>                                                    <C>                <C>
Assets

Current Assets

Cash and equivalents
(includes restricted funds
of $568,500)                                           $    555,383       $    667,800

Accounts Receivable, less allowance
For doubtful collections of $28,900                          62,694             13,500

LED Equipment held for resale                             1,314,357          1,324,300

Other current assets                                           --               45,000
                                                       ------------       ------------

Total Current Assets                                      1,932,434          2,050,600

Property and Equipment, net                               1,410,914          1,478,600
License Rights                                            1,390,700          1,390,700
Other Assets                                                  5,586              5,700
                                                       ------------       ------------

         Total Assets                                  $  4,739,634       $  4,925,600
                                                       ============       ============

LIABILITIES

Current Liabilities

Current Portion of Long Term Debt                            52,875             13,400
Accounts Payable                                             62,271            254,400
Notes Payable                                             1,455,820          1,184,200
Accrued Liabilities                                         499,674            399,700
                                                       ------------       ------------

Total Current Liabilities                                 2,070,640          1,851,700
                                                       ------------       ------------

Long Term Debt, less current portion                      1,448,895          1,432,900
                                                       ------------       ------------

STOCKHOLDER'S EQUITY
Common Stock, .001 par value;
Authorized 100,000,000 shares;
39,697,196 and 42,774,118 shares issued
June 30, 1998 and September 30, 1998                         42,774             39,700

Capital in Excess of Par                                 13,323,513         13,326,600
Deficit accumulated during the
development stage                                       (12,146,188)       (11,725,300)
                                                       ------------       ------------

                                                          1,220,099          1,641,000
                                                       ------------       ------------

         Total  Liabilities and Stockholders Equity    $  4,739,634       $  4,925,600
                                                       ============       ============
</TABLE>


                                       3
<PAGE>



<TABLE>
                   ComTec International, Inc. and Subsidiaries
                        (a Development Stage Enterprise)
                 Consolidated Condensed Statements of Operations

<CAPTION>
                                                    For the Three Months Ended
                                              September 30, 1998 September 30, 1997 Cumulative
                                                  (unaudited)       (unaudited)    Amounts from
                                                                                     Inception
                                                                                    (unaudited)
                                                  -----------       ----------      -----------
<S>                                               <C>               <C>             <C>
Revenues                                          $    80,954       $        0      $    80,954
Cost of Sales                                          73,888                0           73,888
                                                  -----------       ----------      -----------
Gross Profit                                            7,066                0            7,066

Expenses
   Selling, General and Administrative                167,986          285,527        3,391,786
   Compensation in the form of common stock               --               --         3,655,000
   Management fees- related party                         --               --            65,000
                                                  -----------       ----------      -----------
Loss before other expense (income)                    160,920          285,527        7,104,720
                                                  -----------       ----------      -----------

Other Income (expense)

Interest and Dividend Income                              897             (701)          34,897
Interest expense                                      (50,931)           6,500         (922,931)
Rental and Other Income                                43,927              --           222,227
Prepaid Calling Card services, less revenues              --            (5,905)        (575,800)
Loan Origination Fees                                (253,846)             --          (253,846)
Loss on investments, foreclosures and disposals           --            23,471         (851,300)
Write-down of intangibles and LED equipment               --               --        (2,674,300)
                                                   ----------       ----------      -----------

Total Other Income (Expense)                         (259,953)          23,365       (5,021,053)
                                                   ----------       ----------      -----------

Net Loss                                           $ (420,873)      $ (262,162)    $(12,125,773)
                                                   ==========       ==========      ===========


Weighted Average Common Shares Outstanding
                                                   39,697,196        8,857,079        8,866,064
                                                   ==========       ==========      ===========

Net Loss per Common Share                               (0.01)           (0.03)           (1.37)
                                                   ==========       ==========      ===========





</TABLE>











                                       4
<PAGE>



<TABLE>
                   ComTec International, Inc. and Subsidiaries
                        (a Development Stage Enterprise)
                      Consolidated Statements of Cash Flows

<CAPTION>
                                                                     For the Three Months Ended
                                                           September 30, 1998  September 30, 1997   Cumulative
                                                                (unaudited)       (unaudited)      Amounts from
                                                                                                     inception
                                                                                                    (unaudited)
                                                                 ---------         ---------       ------------
<S>                                                              <C>               <C>             <C>
Operating activities:
  Net Loss                                                       $(420,873)        $(262,162)      $(12,125,773)
                                                                 =========         =========       ============

  Adjustments to reconcile net loss to
     net cash used by operating activities:
      Depreciation expense                                          53,635            10,859            316,835
      Services and Interest exchanged for stock                        --                --           3,304,200
      Gain on Sale of Marketable Securities                            --                --             (10,000)
      Write Down of Intangible                                         --                --           2,674,300
      Losses on investments, foreclosure and disposal                  --                --             677,200

      Changes in assets and liabilities:
      Accounts receivable                                          (49,194)          (30,918)            10,394
      Deposits and other                                           (74,308)         (101,600)           (76,808)
      (Increase) decrease in other current assets                   45,000           (35,820)            11,100
      Increase (decrease) in account payable
       & liabilities                                               (15,065)          (24,680)         1,381,535
      Other Assets                                                     --                --              40,000
                                                                 ---------         ---------       ------------
  Net cash used in operating activities                             58,456          (444,321)        (3,797,017)
                                                                 =========         =========       ============

Investing activities:
  Proceeds of Sale of Marketable Securities                            --                --             267,500
  Proceeds from acquisition                                            --                --              22,100
  License rights                                                       --                --            (424,300)
  Marketable securities                                                --                --            (255,600)
  Non-Operating assets                                                 --                --             (25,000)
  Related Party                                                        --                --             (39,000)
  Purchase of property, plant and equipment                            --                --          (1,699,800)
  Other                                                                --               (929)           (85,200)
                                                                 ---------         ---------       ------------
  Net cash used in investing activities                                --               (929)        (2,239,300)
                                                                 =========         =========       ============

Financing activities:
  Advances from related party                                          --                --             184,500
  Proceeds: private place of common stock                              --                --           1,138,900
  Proceeds: short term notes                                       250,000           250,000          1,545,100
  Warrants                                                             --                --              30,000
Convertible Debentures                                                 --                --           4,100,000
  Payments on notes payable                                            --            (40,000)          (397,800)
  Payment on long-term notes payable                                   --                --              (9,000)
                                                                 ---------         ---------       ------------
  Net cash provided by financing activities                        250,000           (40,000)         6,591,700
                                                                 =========         =========       ============

Increase (Decrease) in cash                                       (112,417)         (485,250)           555,383
                                                                 =========         =========       ============
Beginning cash balance                                             667,800           630,000                --
                                                                 ---------         ---------       ------------
Ending cash balance                                              $ 555,383         $ 144,750       $    555,383
                                                                 =========         =========       ============


</TABLE>



                                       5
<PAGE>




                   ComTec International, Inc. and Subsidiaries
                        (a Development Stage Enterprise)
                 Notes to the Consolidated Financial Statements

Note 1.

a) The summary of the Issuer's significant  accounting policies are incorporated
by reference to the Company's SEC Form 10-KSB as of June 30, 1998.  The notes to
the audited financial statements presented with the Company's SEC Form 10-KSB as
of June  30,  1998  are an  integral  part of the  audited  balance  sheet  data
presented herein.

b)  The  accompanying  unaudited  condensed  financial  statements  reflect  all
adjustments  which,  in the  opinion of  management,  are  necessary  for a fair
presentation  of the results of operations,  financial  position and cash flows.
The results of the interim period are not necessarily  indicative of the results
for the full year.


Note 2.

On March 28, 1997 the  Shareholders  of the Company  approved a proposal to give
the Company's Board of Directors authority to institute a reverse stock split of
from 3 for 1 to 100 for 1 at the  discretion  of the  Board of  Directors  until
December  31,  1997.  On December 26, 1997 the Board of Directors of the Company
acted  pursuant  to  shareholder  authority  granted  at the  Annual  Meeting of
Shareholders  held March 28th,  1997,  to declare a one for five  reverse  stock
split of the Company's .001 par value common stock effective 12:01 A.M.  January
31st,  1998.  All share data and per share data is stated to reflect the reverse
stock split.



                                       6
<PAGE>



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

Overview

     ComTec  international Inc. was incorporated on July 6, 1983 in the State of
New  Mexico,  originally  under the name of Nisus  Video,  Inc.  The Company has
undergone many changes to date as a result of certain reorganizations and recent
change of management.  Historical  changes are more fully  disclosed in prior 34
Act filings and the most recent  changes,  including  changes in management  are
described in the Company's  10-KSB for the year ended June 30, 1998. The Company
is currently authorized to issue 100,000,000 common shares, $0.001 par value and
10,000,000 preferred shares,  $0.001 par value. The Company has one wholly owned
operating subsidiary, American Wireless Network, Inc. ("AWN") and three inactive
subsidiaries.

     American  Wireless  Network,  Inc. ("AWN") a wholly owned subsidiary of the
Company was incorporated  under the laws of the State of Colorado on December 3,
1996, to act as the wireless  communications  operating  entity for the Company.
The Company's  wireless  specialized mobile radio "SMR" operations are conducted
through AWN.

     During the fiscal  year ended June 30,  1998 and  through  the  present the
Company  continued as a  developmental  stage entity  focused on developing  its
wireless  specialized mobile radio "SMR" business plan. Prior to December,  1997
activities  had been  concentrated  on  creating  and  executing  the  Company's
strategic  business plan,  raising private  financing,  efforts to acquire other
entities and  operations,  developing a management  and support staff to execute
its business  plan, and  maintaining  reporting  compliance for various  federal
government agencies,  such as the SEC and FCC. On December 5, 1997 AWN completed
the initial  phase of a purchase  agreement  and on July 6, 1998  completed  the
terms of an agreement  whereby AWN  purchased  seven  operating  SMR systems for
$3,035,700.  The wireless communications assets and associated business acquired
from  Centennial  Communications  Corp.  lay within the  following  seven MTA's:
Birmingham,   Alabama;  Knoxville,  Tennessee;  Memphis,  Tennessee;  Nashville,
Tennessee;  New Orleans,  Louisiana;  Oklahoma City, Oklahoma;  Tulsa, Oklahoma.
During  the  quarter  ended  September  30,  1998 AWN  operated  the  seven  SMR
communications systems from its office in Englewood, Colorado.

(a)   Plan of Operation:

     FORWARD-LOOKING STATEMENTS

     The securities of the Company are  speculative and involve a high degree of
risk, including, but not necessarily limited to, the factors affecting operating
results  described  in the Form 10KSB for the year ended June 30, 1998 and other
filings with the SEC. The statements which are not historical facts contained in
this  report,   including  statements   containing  words  such  as  "believes,"
"expects," "intends,"  "estimates,"  "anticipates," or similar expressions,  are
"forward looking  statements" (as defined in the Private  Securities  Litigation
Reform Act of 1995) that involve risks and uncertainties.

     The foregoing and subsequent  discussion  contains certain  forward-looking
statements  within  the  meaning  of  Section  27A  of the  Securities  A of the
Securities Act of 1933 and Section 21E of the  Securities  Exchange Act of 1934,
which are  intended to be covered by the safe  harbors  created  thereby.  These
forward-looking  statements  include the plans and  objectives of management for
future  operations,  including  plans and  objectives  relating to the  possible
further capitalization and future acquisitions of  telecommunications,  computer
related or other cash flow business.  The  forward-looking  statements  included
herein  are  based on  current  expectations  that  involve  numerous  risks and
uncertainties.  Assumptions  relating to the foregoing  involve  judgments  with
respect  to,  among  other  things,  future  economic,  competitive  and  market
conditions  and  future  business  decisions,  all of  which  are  difficult  or
impossible to predict accurately and many of which are beyond the control of the
Company.  Although the Company  believes  that the  assumptions  underlying  the
forward-looking  statements  are  reasonable,  any of the  assumptions  could be
inaccurate and,  therefore,  there can be no assurance that the  forward-looking
statements included in this Form 10- QSB will prove to be accurate.  In light of
the significant uncertainties inherent in the


                                       7
<PAGE>



forward-looking  statements  included herein,  the inclusion of such information
should not be regarded as a  representation  by the Company or any other  person
that the objectives and plans of the Company will be achieved.

     Since May 10, 1995, the Company's  strategic  business plan has, aside from
terminated  venture in the LED screens and the divested  TTI prepaid  phone card
investment,  been concentrated on wireless  telecommunications.  Currently,  the
Company's  only  business is the recently  commenced  operation of basic two-way
communications  services.  The  Company  has  been  and  continues  to be in the
development  stage.  The  Company  remains  in the  development  stage  and from
inception (March 15, 1994) has only generated  auxiliary  revenues to defray the
cost of its planned operations, with only limited success in implementing actual
operations. The Company has financed its operations during the development stage
from the sale of its common stock and from issuance of short and long-term debt.

     During the  quarter  ended  September  30, 1998 and through the present the
Company  continued  as a  developmental  stage  entity  focused on managing  its
wireless  SMR  business  plan.  During the quarter  ended  September  30,  1998,
activities consisted of operating the SMR systems, control of which was acquired
in December,  1997,  developing  alternative strategic plans, efforts to acquire
financing, developing a management plan and maintaining reporting compliance for
various federal government agencies, such as the SEC and FCC.

Current Status and Operations

     During the fiscal year ended June 30, 1998 and through May 1999 the Company
continued  as a  developmental  stage  entity  focused on managing  its wireless
specialized mobile radio "SMR" business plan. Prior to December, 1997 activities
had been concentrated on creating and executing the Company's strategic business
plan,  raising  private  financing,   efforts  to  acquire  other  entities  and
operations,  developing a management  and support  staff to execute its business
plan,  and  maintaining  reporting  compliance  for various  federal  government
agencies, such as the SEC and FCC. On December 5, 1997 AWN completed the initial
phase of a purchase  agreement whereby AWN purchased seven operating SMR systems
for  $3,035,700.  The wireless  communications  assets and  associated  business
acquired from  Centennial  Communications  Corp. lay within the following  seven
MTA's: Birmingham, Alabama; Knoxville, Tennessee; Memphis, Tennessee; Nashville,
Tennessee;  New Orleans,  Louisiana;  Oklahoma City, Oklahoma;  Tulsa, Oklahoma.
During  the  quarter  ended  September  30,  1998 AWN  operated  the  seven  SMR
communications  systems  from its  office  in  Englewood,  Colorado.  AWN's  SMR
communication  services were sold to individual customers through an independent
dealer  network  of  local  two-way  radio   communications   equipment  vendors
("Dealers").  The Dealers maintain the local  relationships  with the customers.
AWN acts as the direct billing  provider of SMR  communications  to the customer
base provided by the Dealers.  AWN is  responsible  for local  telephone  lines,
equipment maintenance,  tower site rentals, customer loading, coding and billing
and  all  customer  service  and  financial  relationships.  AWN  also  has  all
responsibility  for maintaining its SMR licenses,  making payments to the FCC on
its  licenses  and  funding all  equipment  additions  and system  improvements.
Expenses of operating the system  significantly exceed revenues from the systems
during the quarter ended September 30, 1998 and preceding periods.

     On April 15, 1999,  and as amended on July 14, 1999,  AWN executed an Asset
Acquisition Agreement with CMRS Systems, Inc. an unaffiliated  corporate entity.
The purpose of the Asset Acquisition  Agreement is to facilitate the future sale
by American  Wireless  Network,  Inc.  to CMRS  Systems,  Inc.  of  specifically
identified 900 MHz Licenses and American Wireless Network,  Inc.'s customer base
and customer lists associated with the specified 900 MHz licenses.  The sale and
an associated lease of SMR related equipment owned by AWN, is subject to certain
conditions and events,  including final and  unappealable  regulatory  approvals
relating to the transfer of the licenses to the Buyer. In consideration  for the
sale,  the Buyer is to assume  approximately  $1,400,000  of  American  Wireless
Network,  Inc.'s debt to the Federal  Communications  Commission  related to the
licenses.  AWN will retain a seven and one half percent interest in the specific
operating  assets  sold to CMRS  Systems,  Inc.  which  assets  will be operated
through a division of CMRS  Systems,  Inc. to be known as the S.E. 900 Division.
During the pendancy of the license transfer application, Effective June 1, 1999,
CMRS will operate the SMR systems under a management agreement. As an additional
provision of the agreement,  CMRS Systems, Inc. and AWN entered into a five year
lease  agreement  whereby AWN will lease SMR related  equipment to CMRS Systems,
Inc.

New Funding Efforts:

     In  May  1998,  the  Company  paid  a  $25,000  deposit  to  Sigma  Finance
Corporation in connection with a nonbinding  financing proposal for up to a $200
million ten-year bond issue to be collateralized by all of the Company's assets.
In September 1998, the Board of Directors approved the preliminary  requirements
of the proposed tentative financing arrangement and management was authorized to
take all  necessary  action  to  pursue  and  finalize  the  transaction  if the
opportunity  arises. The significant terms approved by the Board in anticipation
of


                                       8
<PAGE>



potential  financing  include  an  allowance  for the lender of a minimum of two
seats on the Company's Board of Directors, the power of veto over future capital
expenditures and other significant  matters, and issuance of unrestricted shares
of  common  stock  equal to 20% of the  Company's  equity,  with a  non-dilution
agreement  which would have the effect of maintaining the lenders 20% holding at
no cost to the lender whatever  additional issues of equity capital was proposed
or made  during the life of the bond.  In  addition  to legal fees to effect the
financing,  the Company will be required to pay an origination fee of 10% of the
loan  proceeds   should  the  financing   materialize.   Neither  Sigma  Finance
Corporation  nor any other  person or  entity  is  obligated  to make an loan or
provide financing to the Company under any terms.

     Should the Company be successful in obtaining  substantial  additional debt
financing,  management  plans to seek merger with or acquisitions of more mature
telecommunication  or  computer  related  businesses  or other  cash  generating
enterprises  that would generate  sufficient cash flow to maintain debt service.
There  can  be no  assurances  that  the  Company  will  be  successful  in  the
implementation of its plan for expansion and its overall business plan.

Pending Acquisitions:

     Currently there are no letters of intent or other formalized  agreements to
acquire  any  entity or  assets.  The only  acquisition  which the  Company  has
accomplished  to date  is the  purchase  completed  July 6,  1998,  whereby  AWN
purchased  seven   operating  SMR  systems  for   $3,035,697.   from  Centennial
Communications Corp.


 (b)   Liquidity and Capital Resources

     The Company  reported a net loss  (unaudited)  of $420,873  for the quarter
ended  September 30, 1998 and has reported net losses from inception  (March 15,
1994) to September 30, 1998 of  $12,125,773.  The Company had deficient  working
capital at September 30, 1998 of $138,206. As of September 30, 1998, the Company
reported  shareholder equity of $1,220,099.  To date, these losses and cash flow
deficiencies have been financed principally through the sale of common stock and
warrants and issuance of short and long-term debt which  includes  related party
debt.  Additional  capital and/or  borrowings will be necessary in order for the
Company to continue in existence until attaining profitable operations. Although
a portion of  convertible  debt was  liquidated  through the  issuance of common
stock, no assurances can be given that the sources of borrowings would continue.
The  Company  is highly  leveraged  and a number of  developments  over the past
quarter  had  material  adverse  effects  on  the  Company.  The  Company  has a
significant  investment in license rights  obtained  through the  acquisition of
assets from Centennial  Communications,  Corp., the  recoverability  of which is
dependent upon the success of future events.

     Management  has  continued  to develop a strategic  business  plan to raise
private financing,  develop a management team, maintain reporting compliance and
seek new expansive areas in telecommunications. In order to reduce negative cash
flow the Company  entered an  agreement to sell its FCC licenses to satisfy debt
requirements  and in a plan anticipated to generate cash flows, has entered into
an agreement to lease its SMR equipment.

     From  August 1, 1999 to the end of fiscal  year  ended June 30,  2000,  the
Company  estimates  its cash  needs to  maintain  operations  under its  current
negative cash flow situation is approximately  $550,000. This amount is composed
of $550,000 for working capital assuming that current operations continue in its
present status.  These amounts  include offsets for anticipated  amounts of cash
generated from operations, but does not consider possible proceeds from interest
income or sales of assets.

     The Company has limited  capitalization and is dependent on the proceeds of
private or public  offerings to continue as a going concern and  implementing  a
business  plan. As of September 30, 1998,  the unaudited  results of the Company
indicated deficit working capital of $138,206. All during fiscal 1998 and to the
date of this filing,  the Company has had and  continues  to have a  substantial
need for  working  capital for normal  operating  expenses  associated  with the
Company continuing as a going concern.  This lack of cash has slowed its ability
to develop SMR assets and initiate revenue producing operations. Any activity in
the wireless industry requires adequate  financing and on-going funding sources.
The  Company  has entered  this  industry  with  limited  financing  and funding
sources.


     At September 30, 1998  (unaudited),  the following  contingent  stock issue
requirements and warrants were outstanding:


                                       9
<PAGE>



    -    Shares reserved for the Company's incentive stock option plan (900,000)
    -    Shares reserved for issuance in accordance with outstanding warrants
         issued June 30, 1997  (4,242,923) exercisable at $4.50 per share,
         expiring June 30, 2000.
    -    Shares  reserved for contingent  issue with respect to outstanding
         warrants  exercisable at $2.90 per share associated with converted
         debt and LED Screens (7,083,333), expiring in March 2001.
    -    Shares  reserved for contingent  issue with respect to outstanding
         warrants  exercisable at $2.90 per share associated with converted
         debt related to the SMR Asset purchase  (17,600,000),  expiring in
         March 2001.
    -    On February 16, 1998, the Company entered into a letter agreement with
         the Company, which remains to be formalized, by which James Krejci
         became employed as Chief Operations Officer of the Company and
         President and CEO of AWN.  The letter agreement calls for a three year
         employment agreement with the opportunity for Mr. Krejci to obtain,
         through common stock option agreements, up to ten percent (10%) of the
         outstanding common stock of the Company over a three year period.  The
         preliminary agreement calls for Mr. Krejci to receive stock options
         vesting in monthly increments to equal to a total of 5% of the
         Company's outstanding common shares over a three year period.  Options
         to obtain an additional 5% of the Company's outstanding common shares
         are conditioned upon the Company reaching certain financial and
         administrative goal within established timelines.  The strike price of
         all of the potential options, as modified (reprised) by Board of
         Director action on October 7, 1998, is $.056 per share, representing
         80% of the bid price of the Company's common stock on September 2nd,
         1998, (closing bid price $.07) Mr. Krejci's actual appointment date as
         President and CEO of the Company.

     During  quarter  ended  September  30,  1998,  the Company  continued  as a
development stage enterprise.  The Company's financial  statements are therefore
not  indicative of anticipated  revenues  which may be attained or  expenditures
which may be incurred by the Company in future periods. The Company's ability to
achieve profitable  operations is subject to the validity of its assumptions and
risk factors within the industry and pertaining to the Company.

     $80,954 of revenues were  generated  from the Company's  wireless  business
during the quarter ended  September 30, 1998, no revenues were generated  during
the quarter ended September 30, 1997. For the quarter ending September 30, 1998,
the Company  recorded  "other  income" of $43,927 as a result of  adjustments to
previously  recorded  disposition  losses.  For the quarter ending September 30,
1997, the Company recorded other income of $23,471 as a result of adjustments to
previously recorded foreclosure losses.

     For the quarter ending September 30, 1998, the Company incurred General and
Administrative  Expenses of  $167,986,  a decrease of $117,541  from the quarter
ending September 30, 1997, when the Company incurred  expenses of $285,527.  The
Company's  Quarter  ended  September  30,  1998  financial   statements  reflect
adjustments  and  nonrecurring  items  of both  revenue  and  costs,  as well as
development stage costs and are not indicative of anticipated revenues which may
be  attained  or  expenditures  which may be  incurred  by the Company in future
periods.

     The Company has undergone a complete change in management over the past two
years. Since October,  1997 the Company has undergone management  restructure to
the extent that the no Director, Officer or Management Executive associated with
the Company as of the 6/30/96 10KSB is now  associated  with the Company.  Since
October,   1997  several  new  management  executives  have  joined  the  ComTec
International, Inc. organization. James J. Krejci, MBA, formerly a top executive
with Jones Intercable,  Inc./Jones International,  Ltd. associated companies was
named CEO of AWN and COO of the Company in February,  1998. Michael Bunch, a CPA
and MBA, became the organization's  controller in tandem with the appointment of
Gordon  Dihle,  as CFO  and as a  Company  Director  in the  initial  management
restructure  which took place in October,  1997  following  the  resignation  of
Clifford S. Perlman.  As a result of the Special  Meeting of  Shareholders  held
August 26, 1998,  Donald G. Mack and Daniel Melnick were removed as Directors of
the  Company.  In the same  special  shareholders  meeting,  James J. Krejci and
Gordon D. Dihle were elected to the Company's  Board of Directors until the next
annual meeting of the Shareholders. As of August 26, 1998 the Company's Board of
Directors  consisted of J. Kent  Millington  (appointed  May 8, 1998),  James J.
Krejci and Gordon D. Dihle.  J. Kent  Millington  who was  appointed May 8, 1998
resigned from the board of directors  effective  September 2, 1998. At a Special
Board of Directors  meeting held September 2, 1998, the following  officers were
appointed  by the Board of  Directors:  James J.  Krejci as  President,  CEO and
Chairman  of the  Board of  Directors  and  Gordon  D.  Dihle as  Secretary  and
Treasurer.



                                       10
<PAGE>



                                     Part II

ITEM 1.  LEGAL PROCEEDINGS

     On September  14, 1998 the Company  received by certified  mail a Complaint
filed in Superior  Court of  California,  County of San Diego,  Case No.  723581
entitled  John  Brent,  et al  vs.  ComTec  International,  Inc.,  a New  Mexico
corporation,  et al Defendants.  The Complaint by seven named Plaintiffs alleges
securities  fraud,   improper  sale  of  unregistered   securities,   and  stock
manipulation against the Company and five individual  defendants who were former
officers and/or directors of the Company,  none of whom are currently associated
with the Company. The Company believes that it has meritorious defenses and will
vigorously  defend  against  the  allegations  of  the  Complaint.  Due  to  the
preliminary  stage of the matter,  further  information  is not  available.  The
Company filed its answer to Plaintiffs'  Complaint on July 15, 1999. A motion to
dismiss  Plaintiffs'   complaint  for  failure  to  join  indispensable  parties
initiated by the Company is pending.

Litigation with Former Officer and Director

     On February 1, 1999 Donald Mack, the former CEO,  President and director of
ComTec  International,  Inc. filed a complaint in the District  Court,  City and
County of Denver, State of Colorado,  Civil Action Number 99CV634,  Courtroom 6,
against  ComTec  International,  Inc.  ("ComTec")  as  well  as  two  individual
defendants,  a current  officer and a shareholder  of ComTec.  On March 24, 1999
ComTec  filed  its  Answer  and  extensive  Counterclaims  against  Donald  Mack
("Mack").  Mack  alleges  that he is  entitled  to  continued  compensation  and
benefits  based  upon a  March  31,  1997  addendum  to his  December  26,  1995
employment  contract  (which expired in May of 1998).  Mack further alleges that
although he resigned as an officer in June 1998,  he was  wrongfully  induced to
resign. Mack alleges that he is due salary, car allowance, health plan payments,
life  insurance  payments,  stock  bonuses  and other  items from June 30,  1998
through June 30, 2002.  ComTec's  answer states that the March 31, 1997 addendum
is null and void as a matter of law,  denies any  wrongdoing or  inducement  and
denies  any and all  liability  to  Mack.  ComTec's  answer  further  states  as
affirmative  defenses  that Mack's claims are barred by the doctrine of estoppel
and unclean  hands,  that the March 31,  1997  addendum  was entered  into under
circumstances of fraud and illegality,  that Mack's claims are barred by failure
of consideration, fraud and illegality, waiver, failure to mitigate, that Mack's
alleged claims are setoff by the  counterclaims  of ComTec against Mack and that
Mack's  alleged  damages,  if any, are the result of Mack's own actions.  ComTec
believes it has meritorious and virtuous  defenses and anticipates  that it will
vigorously  and  effectively  defend  against  any and all  claims by Mack.  The
Company filed a number of  Counterclaims  against Mack.  Among the  Counterclaim
allegations of ComTec  against Mack are  allegations  that an agreement  entered
into in May of 1995,  whereby Mack gained control of ComTec through an agreement
for ComTec to purchase the assets of a corporation  controlled by Mack, KeyStone
Holding  Corporation,  was entered  into with  intent to defraud  ComTec and its
shareholders.  Among other allegations,  ComTec alleges that  misrepresentations
and  omissions  of  material  fact  were  made by  Mack  prior  to the  Keystone
transaction,  that Mack used ComTec as an  instrumentality  for his own personal
benefit and affairs,  that Mack acted to conceal material facts regarding Mack's
ultra vires and unauthorized acts in the name of ComTec.  ComTec further alleges
that Mack took  unauthorized  and unearned  bonuses in stock of ComTec and cash,
that the  execution of the  employment  addendum  through which Mack is alleging
amounts are now due him from ComTec was  accompanied by  circumstances  of fraud
and  collusion,  and that  Mack  made  unauthorized  use of  ComTec's  funds and
property.     ComTec's     claims    against    Mack    include:     intentional
misrepresentation/fraudulent  inducement  regarding  the  Keystone  Transaction;
fraudulent   concealment/constructive  fraud;  breach  of  warranty;  breach  of
fiduciary  duty;  conversion;  fraudulent  conveyance;  civil theft  pursuant to
C.R.S.  Section  18-4-401 and 18-4-405 and  securities  fraud pursuant to C.R.S.
Section 11-51-501.  ComTec seeks monetary damages and constructive trust as well
as  Declaratory  Judgment  pursuant  to  C.R.C.P.  57.  ComTec  believes  it has
meritorious  claims and will resolutely  pursue its claims against Mack. A trial
date of April 3, 2000 has been set for the matter.

     Except  for  the   foregoing,   no  litigation  or  other   material  legal
proceedings,  to which the  Company is a party or to which the  property  of the
Company is subject, is pending or is known by the Company to be contemplated.

ITEM 2.   CHANGE IN SECURITIES.    NONE

ITEM 3.   DEFAULTS UPON SENIOR SECURITIES.    NONE

ITEM 4.   SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS.

     On August 26, 1998, pursuant to a call for a special  shareholders  meeting
by shareholders owning more than 10% of the Company's common stock and presented
to the shareholders by a notice and proxy mailed by the


                                       11
<PAGE>



Company's  independent  transfer agent on August 11, 1998, a special election of
the shareholders of the Company was held with the following proposed purposes:

         1.   Remove Donald G. Mack from the Board of Directors for cause
         2.   Remove Daniel Melnick from the Board of Directors
         3.   Elect James J. Krejci to the Board of Directors
         4.   Elect Gordon D. Dihle  to the Board of Directors

The necessary quorum of shares were voted at the special meeting. On the date of
the  election  there  were  39,626,718  shares  of .001 par value  common  stock
outstanding. The results of the election were as follows:

Remove Donald G. Mack from the Board of Directors for cause

Votes for:  30,762,644              Votes against: 10,317     Abstain: 700

Remove Daniel Melnick from the Board of Directors

Votes for:  30,803,034              Votes against: 100        Abstain: 700

Elect James J. Krejci to the Board of Directors

Votes for: 30,803,034               Votes against:  0         Abstain: 800

Elect Gordon D. Dihle  to the Board of Directors

Votes for:  30,753,364              Votes against: 53,571     Abstain: 4,899


As a result of the Special Meeting of Shareholders  held August 26, 1998, Donald
G. Mack and Daniel  Melnick were  removed as Directors of the Company.  James J.
Krejci  and Gordon D. Dihle were  elected to the  Company's  Board of  Directors
until the next annual meeting of the Shareholders.



ITEM 5.  OTHER INFORMATION:  NONE

ITEM 6.  EXHIBITS AND REPORTS ON FORM 8-K

(a) & (b) Financial Statements and Schedules. See Financial Statements beginning
on page 3.

(c)       Exhibits.  The following documents are filed herewith or incorporated
herein by reference as Exhibits:

Exhibits

2.1      N/A

3.0      Articles of Incorporation of the Company. (incorporated by reference to
         Exhibit  3.1 to the  Company's  Form  S-1  Registration  Statement  No.
         82-88530 dated December 20, 1983).  Amendment Incorporated by Reference
         to Form 8-K dated May 12, 1997.

3.1      By-laws.  (incorporated  by reference  to Exhibit 3.2 to the  Company's
         Form S-1  Registration  Statement No.  82-88530 dated December 20, 1983
         and Exhibit 3.2 Form 10KSB for the year ended June 30, 1998)

4.0      Certificate of Designation of Series A Preferred Shares. (1)

4.1      Certificate of Designation of Series B Preferred Shares. (1)

4.2      Certificate of Designation of Series C Preferred Shares. (1)

10.01    Form of Employment Agreement between the Company and its former
         officers. (1)


                                       12
<PAGE>



10.02    Letter Agreement between the Company and James J. Krejci. (2)(3)

11       Not Applicable.

15       Not Applicable.

18       Not applicable.

19       Not applicable.

22       Not Applicable.

23       Not Applicable.

24       Not applicable .

27       Financial Data Schedule

99       Not applicable

d)       The Company filed the following reports on Form 8-K:

     September  3, 1998 - Current  Form 8-K to report  the final  closing of the
purchase of SMR assets from Centennial  Communications  Corp; the termination of
SMR license options with DCL Associates and other license  holders,  the results
of the  special  meeting of  shareholders  held August 26,  1998;  the change in
management  as a result of the August 26, 1998 special  meeting of  shareholders
and related events;  and issuance of securities on May 20, 1998 and September 2,
1998 pursuant to Regulation S Exemptions.

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

(1)  Incorporated by reference to the Company's Form 10-KSB as of June 30, 1996.
(2)  Incorporated by reference to the Company's Form 10-KSB as of June 30, 1997.
(3)  Incorporated by reference to the Company's Form 10-KSB as of June 30, 1998.



                                   SIGNATURES


Pursuant  to the  requirements  of the  Section  13 or 15(d)  of the  Securities
Exchange  Act of 1934,  the Company  has duly  caused this report  signed on its
behalf by the Undersigned, thereunto duly authorized.

                                         COMTEC INTERNATIONAL, INC.

Date:   July 20,  1999                   By:    /s/ James J. Krejci
                                            ----------------------------------
                                            James J. Krejci, President and
                                            Chief Executive Officer

                                         By:    /s Gordon Dihle
                                            ----------------------------------
                                            Chief Financial Officer



                                       13