U.S. SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549
                                  FORM 10-KSBA

(Mark One)
[x]     Annual report under section 13 or 15(d) of the  Securities  Exchange Act
        of 1934 for the fiscal year ended  October 31, 1995. 
[ ]     Transition  report under section 13 or  15(d) of the Securities Exchange
        Act of 1934 for the transition period from _________ to __________

Commission file number                                             20252-NY

                       Transworld Telecommunications, Inc.
                 (Name of small business issuer in its charter)


        Pennsylvania                                       52-1546434
(State or other jurisdiction of                      (I.R.S. Employer
 incorporation or organization)                       Identificaiton No.) 


  102 West 500 South, Suite 320                            
      Salt Lake City, Utah                                   84101
(Address of principal executive offices)                   (Zip Code)

       
(Issuer's telephone number)  (801) 328-5618


Securities to be registered under Section       Name of each exchange on  
 12(b) of the Act:  Title of each class             which registered 
        Common Stock, Par Value $.001                 Boston Exchange



Check  whether  the  registrant  (1) filed all  reports  required to be filed by
Section 13 or 15(d) of the Securities 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 X
No

Check if there is no disclosure of delinquent  filers in response to Item 405 of
Regulations  S-B is not  contained  in  this  form,  and no  disclosure  will be
contained,  to the  best of  registrant's  knowledge,  in  definitive  proxy  or
information statements incorporated by reference in Part III of this Form 10-KSB
or any amendment to this Form 10-KSB. [ ]

State the registrant's net revenue for its most recent fiscal year:    $ - 0 -

The  aggregate  market  value of  voting  stock  held by  non-affiliates  of the
registrant on January 29, 1996, was approximately  $13,078,190  calculated using
the  average of the bid and ask prices of  registrant's  Common  Stock.  On such
date, the bid and ask prices of registrant's Common Stock were $1.125 and $1.250
respectively, per share.

As of January 29, 1996,  28,564,228  shares of  registrant's  Common Stock,  par
value $.001 per share, were outstanding.


<PAGE>


PART F/S

        The list of financial  statements  accompanying this report is set forth
in the index to the financial statements below.



                      TRANSWORLD TELECOMMUNICATIONS, INC.

                       INDEX TO THE FINANCIAL STATEMENTS



Independent Auditor's Report                                       F-1

Consolidated Balance Sheets                                        F-2

Consolidated Statements of Operations                              F-3

Consolidated Statement of Stockholders' Equity                     F-4

Consolidated Statement of Cash Flows                         F-5 - F-6

Notes to Consolidated Financial Statements                  F-7 - F-18



<PAGE>


              TRANSWORLD TELECOMMUNICATIONS, INC. AND SUBSIDIARIES


                        Consolidated Financial Statements

                            October 31, 1995 and 1994


                   (With Independent Auditors' Report Thereon)

<PAGE>




                          Independent Auditors' Report



The Board of Directors
Transworld Telecommunications, Inc.:


We have  audited the  accompanying  consolidated  balance  sheets of  Transworld
Telecommunications,  Inc. and  subsidiaries as of October 31, 1995 and 1994, and
the related  consolidated  statements of operations,  stockholders'  equity, and
cash flows for the years then ended. These consolidated financial statements are
the responsibility of the Company's management. Our responsibility is to express
an opinion on these consolidated financial statements based on our audits.

We  conducted  our  audits  in  accordance  with  generally   accepted  auditing
standards.  Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements are free of material
misstatement.  An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements.  An audit also includes
assessing the  accounting  principles  used and  significant  estimates  made by
management,  as well as evaluating the overall financial statement presentation.
We believe that our audits provide a reasonable basis for our opinion.

In our opinion, the consolidated  financial statements referred to above present
fairly,  in  all  material  respects,   the  financial  position  of  Transworld
Telecommunications,  Inc. and  subsidiaries as of October 31, 1995 and 1994, and
the results of their operations and their cash flows for the years then ended in
conformity with generally accepted accounting principles.







                                                KPMG Peat Marwick LLP

Salt Lake City, Utah
December 22, 1995, except for notes 
2 and 10, which are as of October 22, 1996.


<PAGE>


              TRANSWORLD TELECOMMUNICATIONS, INC. AND SUBSIDIARIES

                           Consolidated Balance Sheets

                           October 31, 1995 and 1994


             Assets                                1995                 1994


Current assets:
   Cash                                        $    94,391           265,462  
   Receivable from investee 
    company (note 2)                                 3,672            88,620
   Other receivables                                15,215            48,230
                                               ------------        ---------- 

       Total current assets                        113,278           402,312

Furniture and equipment, at cost, 
 less accumulated depreciation  
 of $12,965 in 1995 and $3,720 in 1994              33,259            55,503

Deposits and other assets                            7,666             8,414

Investment in and advances to investee 
 companies (notes 2 and 10)                      1,457,642         7,155,213

Channel rights/broadcast licenses, at 
 cost, less accumulated amortization of 
 56,250 in 1994 (notes 2 and 8)                          -         1,443,750
                                                -----------       -----------  
                                                $1,611,845         9,065,192
                                                ===========       ===========

     Liabilities and Stockholders' Equity


Current liabilities:
   Trade accounts payable                       $  261,442           357,670
   Accrued liabilities                             323,045           538,053 
   Notes  payable - related party (note 3):        150,000           150,000
   Net current liabilities of discontinued 
    operation (note 4)                             825,178           845,277 
                                                -----------       -----------
         Total current liabilities               1,559,665         1,891,000


Stockholders' equity (notes 5, 6 and 10):
   Common stock, $.001 par value, 200,000,000
    shares authorized; issued and outstanding 
    28,564,228 in 1995 and 28,484,228 shares 
    in 1994                                         28,564            28,484
   Additional paid-in capital                   12,964,990        13,912,573
   Accumulated deficit                         (12,941,374)       (6,766,865) 
                                               -----------        ----------  
         Net stockholders' equity                   52,180         7,174,192


Commitments and contingencies 
 (notes 9 and 10)
                                              -------------      ------------

                                               $ 1,611,845         9,065,192
                                              =============      ============

See accompanying notes to consolidated financial statements.

<PAGE>



              TRANSWORLD TELECOMMUNICATIONS, INC. AND SUBSIDIARIES

                     Consolidated Statements of Operations

                     Years ended October 31, 1995, and 1994






                                                   1995               1994


Revenues                                       $      -                    -
                                               -----------         ----------
Operating expenses:
   Contract services                            100,565            1,295,579
   Channel rights                               173,187               95,934
   Salaries and related benefits                783,506            1,356,551 
   Professional fees                            767,518              724,127
   Depreciation and amortization                121,745               59,971
   Other                                        521,845              641,108
                                              -----------         -----------
        Total operating expenses              2,468,366            4,183,270
                                              -----------         -----------
        Loss from operations                 (2,468,366)          (4,183,270)

Other income (expense):
   Interest income                              207,852               39,675
   Interest expense                             (19,077)            (304,258) 
   Equity in net loss of investee                
    companies (note 2)                       (5,865,766)          (1,405,350)
   Other                                         75,748             (124,564)   
                                             -----------          ----------
        Total other income (expense)         (5,601,243)          (1,794,497)
                                             -----------          -----------
Loss from continuing operations              (8,069,609)          (5,977,767)

Income from discontinued operations, net 
 of income tax expense of $120,964 in 1995 
 and $135,000 in 1994 (note 4)                1,895,100            2,351,248
                                             -----------          -----------
         Net loss                           $(6,174,509)          (3,626,519)
                                            =============         ============
Net loss per common share:
  Continued operations                      $      (.28)                (.22)
  Discontinued operations                           .06                  .09 
                                            -----------           ------------
                                            $      (.22)                (.13)
                                            ============          ============ 



See accompanying notes to consolidated financial statements.

<PAGE>


              TRANSWORLD TELECOMMUNICATIONS, INC. AND SUBSIDIARIES

                 Consolidated Statements of Stockholders' Equity

                      Years ended October 31, 1995 and 1994


<TABLE>
<CAPTION>
                                                              Additional       Retained         Net stock-
                                       Common stock            paid-in         earnings          holders'
                                   Shares         Amount        capital        (deficit)         equity 
                                  --------        -------     -----------     -----------     ------------- 
<S>                            <C>            <C>           <C>            <C>               <C>       
Balances, October 31, 1993       27,308,853     $  27,309     $ 4,090,610    $ (3,140,346)     $  977,573

Issuance of common 
 stock for cash                      50,000            50          19,950               -          20,000

Issuance of common 
 stock for services                 833,000           833       1,101,917               -       1,102,750

Adjustment for sale of 
 interest in TV-Tampa                     -             -         461,481               -         461,481

Issuance of common stock          
 in connection with the 
 purchase of channel 
 leases & licenses                  956,813          957        3,516,606               -       3,517,563

Retirement of shares of 
 major stockholder               (2,500,000)      (2,500)           2,500               -               - 

Issuance of options                       -            -          693,750               -         693,750

Conversion of preferred
 stock and purchase of 
 debentures                       1,835,562        1,835        4,025,759               -       4,027,594 

Net loss                                  -            -                -      (3,626,519)     (3,626,519) 
                                 -----------      --------     -----------     ------------    -----------         

Balances, October 31, 1994       28,484,228     $ 28,484      $13,912,573     $(6,766,865)    $ 7,174,192

Issuance of stock in 
 satisfaction of a liability         80,000           80           49,920                          50,000

Issuance of options                       -            -            7,500               -           7,500

Spin-off of assets                        -            -       (1,005,003)              -      (1,005,003) 

Net loss                                  -            -                -      (6,174,509)     (6,174,509) 
                                ------------     ---------     -----------    -------------    ------------ 
Balances, October 31, 1995       28,564,228     $ 28,564      $12,964,990    $(12,941,374)    $    52,180     
                                ============    =========     ============   ==============   =============                
</TABLE>



See accompanying notes to consolidated financial statements.

<PAGE>


              TRANSWORLD TELECOMMUNICATIONS, INC. AND SUBSIDIARIES

                      Consolidated Statements of Cash Flows

                      Years ended October 31, 1995 and 1994




                                                     1995               1994

Cash flows from continuing operating 
 activities:
   Loss from continuing operations                $(8,069,609)     (5,977,767)
   Adjustments to reconcile net income                                        
    to net cash used in continuing                                            
    operating activities:                                             
   Depreciation and amortization                      121,745         59,971  
   Equity in net loss in investee companies         5,865,766      1,405,350    
   Issuance  of  stock  options                         7,500        693,750  
   Interest  income  issued  in the  form  of                          
    additional debt                                  (207,852)             -  
   Write-off of WCCI receivable                       339,246              -  
   Common stock issued for services                         -      1,102,750   
   Loss on debentures                                       -        172,393   
   Changes in assets and liabilities:                                         
     Receivables                                      117,963         16,999   
     Other assets                                      40,405       (135,680) 
     Account payable and accrued liabilities         (261,236)      (470,569) 
     Notes payable - related party                          -        105,000  
                                                    ----------    ------------ 
       Net cash used in continuing 
        operating activities                       (2,046,072)    (3,027,803)
                                                   -----------    ------------


Cash flows from discontinued operating 
 activities:
   Income from discontinued operations             1,895,100      2,351,248 
   Change in net liabilities of discontinued
    operations                                       (20,099)       599,488   
                                                   ----------     ---------- 
      Net cash provided by discontinued 
       operating activities                        1,875,001      2,950,736 
                                                  ------------   -----------
            Net cash used in operating 
             activities                             (171,071)       (77,067)
                                                  ------------   ----------- 

Cash flows used in investing activities: 
 Capital expenditures                                      -        (46,223)
 Proceeds from sale of interest in subsidiary              -      4,632,193
 Investment in Wireless Holdings, Inc.                     -     (4,642,000)
                                                  ------------   -----------
            Net cash used in investing 
             activities                                    -        (56,030)
                                                  ------------   ------------


<PAGE>



              TRANSWORLD TELECOMMUNICATIONS, INC. AND SUBSIDIARIES

                Consolidated Statements of Cash Flows (continued)

                      Years ended October 31, 1995 and 1994





                                                      1995              1994

Cash flows from  financing  activities:
 Redemption of preferred stock                            -         (400,690)   
 Proceeds from payments on debentures                     -          700,000
 Proceeds from sale of preferred stock                    -           10,000 
 Proceeds from issuance of common stock                   -           20,000
                                                    ---------       ----------
                  Net cash provided by financing 
                   activities                             -          329,310
                                                    ---------       ----------
Increase (decrease) in cash                        (171,071)         196,213

Cash at beginning of year                           265,462           69,249
                                                  ----------        ---------
Cash at end of year                               $  94,391          265,462
                                                  ===========       ==========


Supplemental Disclosure of Cash Flow Information

Interest paid                                    $        -            3,246

Preferred dividends paid                         $        -          282,711


Supplemental Schedule of Non-Cash Investing 
  and Financing Activities

Issuance of common stock for:
  Conversion of preferred stock and             $        -         4,027,594
   purchase of debentures
  Purchase of channel leases and licenses       $        -         3,667,563
  Satisfaction of a liability                   $   50,000                 - 
Spin-off of assets                              $1,005,003                 -


See accompanying notes to consolidated financial statements.


<PAGE>

              TRANSWORLD TELECOMMUNICAITONS, INC. AND SUBSIDIARIES

                   Notes to Consolidatwd Financial Statements
 
                            October 31, 1995 and 1994


(1)     Summary of Business and Significant Accounting Policies

       (a)   Summary of Business

             Transworld Telecommunications, Inc. (the Company)  was incorporated
             under the laws of the  Commonwealth of Pennsylvania. The Company is
             involved  in   the  telecommunications  industry   with  continuing
             operations in wireless  cable television systems.  The Company also
             has "Pay-per-Call"  services  in the entertainment  and information
             markets,  which are  currently  held  for sale  and  classified  as
             discontinued operations.

       (b)   Principles of Consolidation and Equity Investments

             The  consolidated  financial  statements  include  the  accounts of
             Transworld   Telecommunications,   Inc.   and   its  wholly   owned
             subsidiaries, including Carolina Communications, Inc. (Carolina), a
             discontinued operation.  All significant intercompany  accounts and
             transactions have been eliminated in consolidation.

             The  Company  accounts  for its 20 percent  interest  in  Videotron
             Bay Area, Inc.  (Videotron  Tampa Bay) and its 50 percent  interest
             in  Wireless Holdings, Inc. (WHI) on  the equity method, commencing
             November 19, 1993 through August 31, 1994 and the fiscal year ended
             August 31, 1995.

       (c)   Cash and Cash Equivalents

             For  purposes  of reporting  cash flows, the Company considers  all
             highly   liquid  investments  purchased   with a maturity  of three
             months or less to be cash or cash equivalents.

       (d)   Furniture and Equipment

             Furniture  and  equipment  are  stated at  cost,  less  accumulated
             depreciation.  Depreciation  is  provided  using the  straight-line
             method on estimated useful lives of five to fifteen years.

       (e)   Channel Rights and Broadcasting Licenses

             Channel rights,  licenses,  and  multiple-dwelling  unit agreements
             are  recorded at  cost and are amortized  on a straight-line  basis
             over the initial  term of underlying  agreements,  which range from
             seven to fifteen years.

       (f)   Income Taxes

             The Company accounts for  income  taxes  using  the asset/liability
             method,  under  which  deferred  tax  assets  and  liabilities  are
             established  at  the  balance  sheet  date  in   amounts   that are
             expected  to be  recoverable or payable when the differences in the
             tax and book basis of asset and liabilities (temporary differences)
             reverse.

<PAGE>

              TANSWORLD TELECOMMUNICATIONS, INC. AND SUBSIDIARIES

                   Notes to Consolidated Finacial Statements



(1)     Summary of Business and Significant Accounting Policies (continued)

        (g)   Loss Per Share

              Loss  per  share  is  based  upon  weighted  average common shares
              outstanding amounting to 28,544,448 and  27,485,673 shares for the
              two years  ended  October 31 1995  and 1994, respectively.  Common
              equivalent shares  from  warrants and  convertible preferred stock
              are excluded from the computation as their effect is antidilutive.

        (h)   Use of Estimates

              Management  of  the  Company has  made a  number  of estimates and
              assumptions  relating to  the  reporting of assets and liabilities
              and the  disclosure  of  contingent liabilities  to  prepare these
              financial   statements   in  conformity  with  generally  accepted
              accounting  principles.  Actua  results  could  differ  from those
              estimates.

(2)     Equity Investments

              On  November 19, 1993, the  Company  contributed  800 of its 1,000
              shares of  Transworld  Wireless TV - Tampa Bay, Inc.  (TWTV-Tampa)
              common stock to Videotron Tampa Bay. Videotron  Tampa Bay reissued
              the 800 shares  to Videotron  USA, Inc. (Videotron) for $7 million
              in cash. Accordingly, effective October 31,  1993, the accounts of
              Videotron  Tampa Bay are not included in the consolidated accounts
              of  the  Company. Concurrently  with  this  sale, the Company sold
              Videotron  1,000  shares  of  its  Class  A  Series B  convertible
              preferred  stock  for $1.5  million in cash.  As a result of these
              transactions,  the Company recognized a contribution to additional
              paid in capital  of  $461,481  and a  purchase  of preferred stock
              of $10,000.  In  addition,  the  Company received the right to put
              its remaining shares of Videotron Tampa Bay for a five year period
              at anytime after December 31, 1994 to Videotron for the greater of
              $2.6 million or the then  fair market value.  Videotron also holds
              a  right  of  first  refusal  on  any  sale  of the  200 shares of
              Videotron Tampa Bay held by the Company.

              On November 19, 1993, the  Company invested $4,642,000 for a fifty
              percent interest in WHI.Videotron invested the other fifty percent
              interest in WHI.  The business  purpose of WHI is to invest in and
              develop wireless cable television and private cable systems in the
              United States.

              In  February  1994,  WHI  acquired  an  existing  wireless   cable
              television  system  in  Spokane,  Washington  and   wireless cable
              television  licenses and  lease rights  and a private cable system
              in San  Francisco, California.  The  combined  purchase  price for
              these  assets  was  $22,500,000  comprise  $11,360,000 of cash and
              $11,140,000 in debt and assumption of liabilities.

              In  May 1994, WHI,  through  a series of transactions to which the
              Company  was  a party,  acquired  license  and   lease  rights  in
              Victorville  and San  Diego, California,  and   Greenville,  South
              Carolina.  The  combined  purchase  price  for  these  assets  was
              $6,617,313,  comprised  of  $3,814,750  in  cash,   liabilities of
              $635,000  and 619,312 shares of the Company's  common stock valued
              at $2,167,563.  The  issuance of the  Company's  common  stock for
              the license and lease  rights  noted above  has been accounted for
              as an exchange for promissory notes from WHI.

<PAGE>

(2)           Equity Investments (continued)

              The promissory notes are due January 15, 1999, at an interest rate
              equal to  the greater  of 15  percent  per year or  prime plus six
              percent.  In connection  with the transactions, the Company issued
              800,000  shares  of  its common stock,  to a company  of which the
              father of  the  president  of  the  Company  is a part  owner, for
              services and brokerage fees.

              On March 31, 1995, the  Company  recorded  accrued interest in the
              amount of $207,852 as the promissory notes were reissued,including
              accrued  interest  for  a  total  of  $2,375,415,   as   unsecured
              promissory notes  with similar  terms as the previous notes except
              the  interest  rate  was  10.625%. The Company has not accrued any
              interest on the notes receivable from WHI after March 31, 1995.

              In  conjunction  with  the  May 1994 transaction, the Company also
              acquired  lease and  license rights in Auckland, New Zealand.  The
              combined  purchase  price for  these  license and lease rights was
              $1,500,000,  comprised of  337,500 shares  of the Company's common
              stock and liabilities of $150,000.

              A  summary  of  the  Company's  investment   in  and  advances  to
              investee companies at October 31 follows:



                                               1995                  1994

Notes receivable                          $  2,375,415            2,167,563

Equity investment                             (917,773)           4,987,650
                                          ------------           ----------
        Total                             $  1,457,642            7,155,213
                                          ============           ===========




<PAGE>



(2)     Equity Investments (continued)

        The Company accounts  for its equity  in investee companies based on the
        investee companies' fiscal year which ends August 31.  Summary financial
        information  for the investee  companies as  of and for  the period from
        November 19, 1993 (the date of WHI's inception) through  August 31, 1994
        follows:

                                                                  Videotron
                                                  WHI             Tampa Bay


Revenue                                       $ 2,266,000           700,000
Operating expenses                              3,519,000         1,872,000
                                              -----------         ---------
Operating loss                                 (1,253,000)       (1,172,000)

Net interest expense                           (1,278,000)         (164,000) 
Minority interest                                  39,000                 - 
Income tax benefit                                      -           520,000 
                                              ------------      ------------
Net loss                                    $  (2,492,000)         (816,000)
                                            ==============      ============

Assets:
   Current assets                          $   3,656,000           269,000   
   Fixed assets                                6,549,000         1,969,000 
   Licenses                                   21,054,000        11,801,000
   Other                                               -            32,000   
                                           -------------       ------------   
         Total assets                      $  31,259,000        14,071,000
                                           =============       ============

Liabilities:
   Current liabilities                     $  24,183,000         3,885,000
   Deferred income taxes                               -         1,862,000  
                                           --------------      ------------
         Total liabilities                    24,183,000         5,747,000

Minority interest                                282,000                 -

Total stockholders' equity:                    6,794,000         8,324,000
                                           --------------       -----------

          Total liabilities and 
           stockholders' equity             $ 31,259,000        14,071,000
                                           =============       ===========






<PAGE>





(2)     Equity Investments (continued)

        Summary financial  information for the investee  companies as of and for
        the fiscal year ended August 31, 1995 follows:


                                                             Videotron  
                                                  WHI        Tampa Bay


Revenue                                       $ 4,146,000       942,000
Operating expenses                             11,218,000     3,936,000
                                              -----------     ----------
Operating loss                                 (7,072,000)   (2,994,000)      

Net interest expense                           (4,017,000)     (709,000)   
Minority interest                                 227,000             -  
Income tax benefit                                      -     1,428,000        
Extraordinary gain                                      -       101,000       
                                              ------------   -----------
Net loss                                    $ (10,862,000)   (2,174,000)

Assets:
   Current assets                           $   1,574,000     1,272,000  
   Fixed assets                                11,113,000     5,565,000    
   Licenses                                    29,420,000    11,187,000   
   Other                                                -        34,000     
                                           --------------   -----------      

            Total assets                    $  42,107,000    18,058,000
                                           ==============   ===========

Liabilities:
   Current liabilities                      $  46,121,000    11,414,000
   Deferred income taxes                                -       494,000 
                                           ---------------  -----------
            Total liabilities                  46,121,000    11,908,000

Minority interest                                  54,000             -

Total stockholders' equity:                    (4,068,000)    6,150,000
                                           --------------   -----------   
            Total liabilities and 
             stockholders' equity           $  42,107,000    18,058,000
                                          ================  ===========

        The  financial  statements  of  WHI and  Videotron  Tampa  Bay  disclose
        certain uncertainties related to the  possible sale  of  the  companies,
        a  related  arbitration proceeding, and reliance on Videotron USA, Inc.,
        the other  principal  investor  of these  companies,  and  its  ultimate
        parent, Le Groupe Videotron Ltee,  to fund the  day to day operations of
        these   companies. These   financial   statements  do  not  include  any
        adjustments  relating  to  the  recoverability  and  classification   of
        recorded asset amounts of the amounts and  classification of liabilities
        that might be  necessary should  these  investee  companies be unable to
        continue  as  going  concerns.  The  financial  statements  of  WHI  and


<PAGE>

              TRANSWORLD TELECOMMUNICAITONS, INC. AND SUBSIDIARIES

                   Notes to Consolidated Financial Statements

        Videotron Tampa Bay also disclose that continuation as going concerns is
        dependent  upon  the  ability of these companies to generate  sufficient
        cash  flow  to  meet  their  obligations  on  a  timely basis, to obtain
        additional financing or refinancing, and ultimately to attain successful
        operations.

(3)     Related Party Transactions

        In addition to related party  transactions  disclosed  elsewhere herein,
        other significant related party transactions are summarized as follows:

        During fiscal 1994, the Company awarded 15,000 shares of common stock to
        an individual, who is  the uncle of the Company's Chairman of the Board,
        for serving as a director of Carolina.  During fiscal 1995 and 1994, the
        Company  paid  various  companies  owned  by directors  of  the  Company
        $71,304  and  $72,739,  respectively,  as  reimbursement  of  travel and
        office  expenses.  At October 31, 1995 and 1994, the Company's  accounts
        payable  included  $63,992  and  $57,240,  respectively,  of payables to
        officers, directors and companies owned by officers and directors of the
        Company.  Included in accrued liabilities is a facility  fee  payable of
        $50,000  due  to  a company  of  which a  director  of the  Company is a
        principal  owner. In January  1995,  the Company  issued  80,000  shares
        of the Company's  common stock in connection with this  transaction.  In
        addition, the Company paid professional fees to a law firm in the amount
        of $33,283 in 1994. A partner in the law firm (and another  attorney who
        is of counsel) are directors of the Company.During fiscal 1995 and 1994,
        the Company paid $5,166 and $3,771, respectively, to Videotron Tampa Bay
        for management fees.

        The  note  payable  to a related  party is due to a company of which the
        father of the president of the Company is a major stockholder.  The note
        is unsecured, bears  interest  at 12 percent  and was originally  due on
        March 31, 1994. On February 28, 1995, the note payment date was extended
        to January 1, 1996 and  the Company paid an additional $15,000 extension
        fee.

(4)     Discontinued Operations

        On February  28, 1994, the  Board  of  Directors approved a plan to sell
        Carolina,  a  wholly  owned  subsidiary  involved  in  the  pay-per-call
        industry.  Accordingly, Carolina is reported as a discontinued operation
        in the  consolidated financial statements for all periods presented.  It
        is management's  opinion  that the sale of Carolina will not result in a
        loss.  Accordingly, no provision for loss has been recorded.

        A  summary  of  operating  results  and  the  net   liabilities  of  the
        discontinued operation for the years ended October 31, 1995 and 1994 and
        the net liabilities as of October 31, 1995 and 1994 are as follows:


                                                     1995              1994


Net sales                                        $ 3,714,383        5,810,419
                                                 ============       ==========
Income before income tax expense                 $ 2,016,064        2,486,248
Income tax expense                                  (120,964)        (135,000)  
                                                 -----------        ----------
        Net income                               $ 1,895,100        2,351,248
                                                 ===========        ===========
<PAGE>


              TRANSWORLD TELECOMMUNICAITONS, INC. AND SUBSIDIARIES

                   Notes to Consolidated Financial Statements

(4)     Discontinued Operations (continued)


                                                    1995               1994

         Current assets                          $   222,179            75,510 
         Property and equipment, net                  29,535            43,718 
         Accounts payable and accrued 
           liabilities                            (1,076,892)         (964,505)
                                                 ------------         ---------
                Net current liabilities of 
                 discontinued operations         $  (825,178)         (845,277)
                                                 ============         =========
        Included in  accrued liabilities  are accrued  management fees  due to a
        company owned by the Chairman of the Company's Board of Directors.  This
        company  provides  management  services  to  Carolina  and  Carolina  is
        dependent upon this company for all operations.  Management fees related
        to  company  owned  by  the  Chairman amounted  to  $389,500 in 1995 and
        $390,000 in 1994.

(5)     Common Stock

        In August  1994, the Company's Chairman  of the Board contributed to the
        Company  2.5  million shares of  his  common  stock  of  the Company and
        options to acquire 358,334 shares of the Company's common stock.  In the
        opinion  of  management,  the  retirement  of these  shares  and options
        allowed  the  Company  to complete the conversion of the preferred stock
        described  in note 6 and  certain stock option awards without materially
        diluting its other common shareholders' equity positions.

        During the year ended  October 31, 1994, the Board of Directors canceled
        1,383,335 option  shares awarded to officers in 1993, none of which were
        exercised,  and  replaced them  with options in the aggregate of 925,000
        shares at $1.00 per  share. The  option price set forth  was below  fair
        market  value,  resulting  in   a  compensation  expense  to the Company
        of $693,750.  In June 1995, the Company awarded options in the aggregate
        of 15,000 shares  at  $1.25 per share  to  the  Company's  three outside
        directors.  The  option  price  set  forth  was below fair market value,
        resulting  in  a  compensation  expense to the Company of $7,500. All of
        these  options  vest at the  date of  grant  and are  exercisable  for a
        five-year period.

        In  addition,  during  1994  the  Company  reserved 3,000,000 shares for
        issuance  under  a  stock  option plan. Options under  this plan have an
        exercise  price which  represent the estimated  fair market value of the
        Company's  common stock at the date of grant, vest at the date of grant,
        and ar exercisable for a five-year period. The stock options are awarded
        by a committee appointed by the Company's Board of Directors. Unoptioned
        shares available  for granting under  the incentive stock option plan at
        October 31, 1995 are 2,660,000.



<PAGE>



(5)     Common Stock (continued)

        A summary of  nonqualified  stock  option  activity is set forth below:



                                               Number of       Option Price
                                                 Options          Per Share
--------------------------------------------------------------------------------
           Outstanding at October 31, 1993         1,533,335      $2.00 to $3.00

              Granted                              1,135,000      $1.00 to $1.75
              Canceled                            (1,383,335)     $2.00 to $3.00
                                                  -----------
           Outstanding at October 31, 1994         1,285,000      $1.00 to $3.00
 
              Granted                                145,000      $1.25 to $1.75

           Outstanding at October 31, 1995         1,430,000      $1.00 to $3.00

        Options exercisable at October 31, 1995 
          were 1,430,000.

        The Company  had 1,250,000 each of Class A and B warrants outstanding in
        1993.  The A warrant gave  each warrant holder the right to purchase one
        share  of  common  stock  at  $.30 per share.  The B  warrant  gave  the
        warrantholder the right to purchase one  share  of common  stock at $.50
        per  share.  The warrants were not exercisable until the Company filed a
        registration statement  with the Securities  and Exchange Commission and
        met other  requirements.  All  warrants expired unissued on February 28,
        1994.

(6)     Class A Redeemable Convertible Cumulative Preferred Stock

        The  Company  has  authorized  1,000,000  shares  of  Class  A  Series A
        Preferred  Stock,  $0.01 par  value.  The rights and  privileges  of the
        Series A  redeemable  convertible  cumulative  preferred  stock  are  as
        follows: (1)  they  carry   no  voting rights except as described in (5)
        below;  (2) divide are calculated at an annual  rate of  eight  percent,
        paid in semiannual installments and are cumulative; (3) the stockholders
        may "put" shares back to the Company  in accordance with a predetermined
        schedule at  a redemption  value of $10 per share; (4) at any time,  the
        stockholders  have  the  option  to  convert  their  principal  into the
        Company's common stock at a  conversion price of $3.75 per common share;
        (5) if  dividend  payments  are in default,  the preferred  stockholders
        have the right to  elect  one-half   of the Board of   Directors  of the
        Company  until all payments  in  default have been paid;  and (6) in the
        event  of  liquidation,  the  preferred  stockholders  receive   payment
        before any amounts are paid to common stockholders.  At October 31, 1995
        and 1994, there were no shares outstanding.

        During  the  fiscal  year ended  October 31, 1994, the  Company redeemed
        40,069  shares  for  $400,690  of  the Series A  redeemable  convertible
        cumulative preferred stock.  In addition, the entire amount remaining of
        Series A redeemable convertible cumulative preferred stock was converted
        into  the Company's common stock in the year ended October 31, 1994 at a
        conversion price of $2.75 per common share.

<PAGE>

              TRANSWORLD TELECOMMUNICATIONS, INC. AND SUBSIDIARIES

                  Notes to Consolidated Fianancial Statements



(6)     Class A Redeemable Convertible Cumulative Preferred Stock (continued)

        The  Company  has  authorized  2,000,000  shares  of  Class  A  Series B
        Preferred   Stock,  $0.01 par value.  The rights and  privileges  of the
        Series B  stockholders are as follows:  (1) the stockholders have voting
        rights,  one vote per share;  (2)  dividends are  noncumulative  and are
        payable at $ per annum per share,  when  declared;   (3)  in  the  event
        of  liquidation,   the  preferred  stockholders  shall  receive  payment
        before  any  amounts  are paid to  common stockholders;  (4) the Company
        has the right to redeem in whole or part,  at any  time,  the  Series  B
        preferred  stock at a price of $10 per share,  plus declared  and unpaid
        dividends.

        In   November   1993,  the  Company  issued  Videotron,   the  Company's
        co-shareholder in WHI, 1,000 shares of preferred Class A Series B stock.
        In September 1994, the Company converted the 1,000 preferred shares into
        1,000 shares  of the  Company's  common stock.  At  October 31, 1995 and
        1994, there were no shares outstanding.

(7)     Income Taxes

        Due  to  net  operating losses  the  Company has  reported no income tax
        expense or  benefit attributable  to continuing operations for the years
        ended October 31, 1995  and 1994.  The following schedule reconciles the
        computed  "expected" tax  benefit based  on U.S.  federal  corporate tax
        rates  effect  for  the  year,  to  the  tax  benefit  reflected  in the
        accompanying  consolidated  financial  statements  based  on  loss  from
        continuing operations:


                                                     1995              1994


            Computed "expected" tax benefit       $ (2,744,000)   $ (2,032,000)
            Discontinued operations                    680,000         845,000
            Nondeductible dividends                          -               -
            TWTV-Tampa disaffiliation                        -          96,000 
            Change in beginning-of-year              2,064,000         670,000
             valuation allowance                    
            Other                                            -          17,000
                                                  -------------   ------------

                  Total tax benefit                $         -    $          -
                                                  =============   ============ 




<PAGE>

              TRANSWORLD TELECOMMUNICATIONS, INC. AND SUBSIDIARIES
 
                   Notes to Consolidated Financial Statements

(7)     Income Taxes (continued)

                The tax  effects  of  temporary  differences  that  give rise to
significant  portions of the deferred tax assets and deferred tax liabilities at
October 31, 1995 and 1994 are presented below:



                                                         1995         1994


            Deferred tax assets:
            Deferred  compensation, due to accrual     $ 275,000   $ 274,000  
             for financial reporting purposes                                  
            Accrued liabilities not deductible           175,000     204,000    
             until  paid for tax reporting                                     
             purposes                                                  
            Fixed assets, due to differences                  -        5,000  
             in depreciation methods                                    
            Net  operating  loss  carryforward           410,000     288,000    
            Investment  in investee  companies         2,070,000     152,000
                                                      -----------  -----------

              Total gross deferred tax assets          2,930,000     923,000
       Less valuation allowance                        2,930,000     923,000
                                                      ----------   ----------
              Net deferred tax asset                  $        -    $      -
                                                      ==========   ==========

The  valuation  allowance  for  deferred  tax assets as of  November 1, 1994 was
$923,000.  The net change in the total  valuation  allowance  for the year ended
October 31, 1995 was an increase of $2,007,000. Ensuing recognized tax benefits,
if any,  relating to the  valuation  allowance  for  deferred tax assets will be
recognized as an income tax benefit in the consolidated statement of operations.

The Company and its subsidiaries have domestic net operating loss  carryforwards
for tax purposes of approximately $1,095,000 expiring between the years 2007 and
2008. These losses are subject to various federal and state limitations.

(8)     Spinoff

                On July 26, 1995, the Board of Directors of the Company voted to
spinoff  to its  shareholders  two of its  subsidiaries  into  Wireless  Cable &
Communications,  Inc.  ("WCCI"),  a Nevada  corporation.  On August 1, 1995, the
Company and WCCI effected the spinoff by the Company  contributing i interest in
the subsidiaries (whose primary assets were channel rights/broadcast licenses in
Auckland,  New  Zealand  and Park  City,  Utah) to WCCI in  exchange  for WCCI's
issuance to the Company of  3,500,000  shares of its common  stock.  The Company
then  transferred  these shares to an escrow agent to be held for the benefit of
the Company's  shareholders.  The  distribution of the 3,500,000 shares from the
escrow  agent will be delayed  until the  Company  and WCCI have  complied  with
certain  requirements of the securities laws. At that time, the 3,500,000 shares
will be  distributed  to the  Company's  shareholders  of record as of August 1,
1995, on a non-pro rata basis,  with the  management  and principal  shareholder
relinquishing a portion of their shares in favor of the public shareholders. The
public  shareholders  as of record on August 1, 1995 will receive  approximately
1.6 shares of WCCI's  common  stock for each 10 shares of the  Company's  common
stock.

<PAGE>


              TRANSWORLD TELECOMMUNICAITONS, INC. AND SUBSIDIARIES

                    Notes to Consolidatd Fiancial Statements
 
(8)     Spinoff (continued)

                In connection with the spin-off,  the Company  committed to loan
up to $1,000,000 to WCCI through the one year period  following the spin-off for
purposes of funding  WCCI's  ongoing  business  operations.  The  commitment  is
subject  to a number  of  conditions  including  the  Company  having  available
resources  to fund its other  obligations  and  commitments.  In  addition,  the
Company  retained a receivable  from WCCI for  approximately  $340,000 which was
subsequently written off.

(9)     Commitments and Contingencies

                The  Company  leases  office  space and office  equipment  under
noncancelable operating lease agreements.

                As of October 31,  1995,  the  Company  was  involved in various
claims and legal  actions  arising in the ordinary  course of  business.  In the
opinion of management, the ultimate disposition of these matters will not have a
material  adverse  effect upon the Company's  consolidated  financial  position,
results of operations or liquidity.

                In  addition,  an action was  brought in a Texas  State Court in
January 1995 against  former  officers  and  directors of Euripides  Development
Corporation,  the  predecessor to the Company,  alleging  fraudulent  actions in
connection with the plaintiff's  inability to exercise Class A and Clas warrants
initially sold by the Company as part of its 1989  registration  statement.  The
suit asks for  damages and a punitive  award of  $400,000.  Under the  expressed
terms of the Company's  registration  statement on Form S-18, the Company had no
obligation to register the warrants,  the warrants were not  exercisable  unless
they were registered,  and, in any event, the plaintiff acquired the warrants in
the secondary market.  Management  believes the chances of a successful recovery
by the plaintiff are remote.

                At October 31,  1995,  the  Company's  working  capital  deficit
totaled $1,446,387.  However,  the Company has an option to require Videotron to
purchase the Company's 20 percent interest in Videotron Tampa Bay at the greater
of $2.6 million cash or its fair market value. However, in management's opinion,
the Company expects to satisfy these current liabilities in the future through a
sale  of  its  investment  in  equity  companies,  a sale  of  its  discontinued
operations or cash from the sale of the 20 percent  interest in Videotron  Tampa
Bay, if needed,  will provide sufficient cash allowing it to meet obligations as
they are due.

(10)    Subsequent Events

                PTG Agreement.  On November 9, 1995, the Company entered into an
agreement with Videotron, Le Groupe Videotron Ltee, Videoway Technologies,  Ltd.
(Videoway),  WHI,  Videotron Tampa Bay,  certain other  affiliates,  and Pacific
Telesis Group and a number of its affiliates (collectively,  "PTG"), pursuant to
which  PTG  agreed  to  acquire,  subject  to  the  approval  of  the  Company's
shareholders,  the Company's entire interest in WHI and Videotron Tampa Bay (the
"PTG  Agreement").  Under the PTG  Agreement,  PTG would also acquire all of the
stock of Videotron,  which holds the stock WHI and Videotron  Tampa Bay not held
by the Company.  The discussion  contained herein regarding the terms of the PTG
Agreement is qualified by reference to the actual terms of the PTG Agreement.

<PAGE>

              TRANSWORLD TELECOMMUNICAIOTNS, INC. AND SUBSIDIARIES

                   Notes to Consolidated Financial Statements



(10)    Subsequent Events (continued)

                The PTG  Agreement  provides  that PTG would pay the Company and
Videoway a total of approximately $175 million.  The consideration would be paid
by the  delivery  of  approximately  $120  million of PTG  common  stock and the
assumption by PTG of  approximately  $52.5 million of debt currently  payable to
Videotron  and $2.4 million of debt owed to the Company  (which would be paid at
closing in PTG common stock).  PTG would also reimburse the Company and Videoway
for certain  expenses  associated  with  subscriber  additions and certain other
expenses.  The purchase price is subject to a number of  adjustments  (which may
reduce  the  consideration   ultimately  received  by  the  Company)  and  other
conditions.  The PTG Agreement  requires that the PTG shares be delivered to the
Company  for  distribution  to  its  shareholders  pursuant  to  a  registration
statement  under the Securities  Act of 1933, as amended.  The Company will seek
the approval of its shareholders  for the  transactions  contemplated by the PTG
Agreement.

     PTG would not acquire any private cable or wireline  systems held by WHI or
Videotron Bay Area,  which would be disposed of by WHI and/or Videotron prior to
the closing of the PTG  Agreement.  WHI and Videotron Bay Area would  distribute
the proceeds from any sale of the excluded assets the Company and Videoway.

                Under  a plan  of  liquidation  to be  adopted  upon  successful
completion of the exchange,  the Company would  distribute  shares of PTG common
stock to the Company's shareholders,  except for $6 million of such shares which
the Company  would be  required to deliver  into an escrow for 11 mont to secure
the  Company's   indemnification   obligation   regarding   representations  and
warranties  to PTG set forth in the PTG  Agreement.  At the  termination  of the
escrow,  the escrow agent would  distribute  such $6 million of PTG common stock
pro rata to the Company's shareholders (less any amount retained to cover claims
made by PTG).  Other assets and  liabilities of the Company would be disposed of
or distributed to the Company's shareholders.

                The Company has previously  entered into  employment  agreements
with  certain key  officers  and  employees  of the Company  which,  among other
provisions,  contains  provisions that commit the Company to severance  payments
under certain  circumstances,  including termination within 60 days of change of
control,  as defined.  The transactions  contemplated by the PTG Agreement would
constitute a change of control for purposes of the employment agreements.

                Arbitration  Proceeding.  On  September  24,  1996,  PTG filed a
demand  for  arbitration  (Arbitration  Demand)  naming the  Company,  Le Groupe
Videotron Ltee, Videoway, WHI, Videotron and Videotron Tampa Bay alleging breach
of the obligations  under the PTG Agreement.  The Arbitration  Demand requests a
declaration that the Company, Le Groupe Videotron Ltee, Videoway, WHI, Videotron
and  Videotron  Tampa  Bay  complete  the  transaction  contemplated  by the PTG
Agreement.  In addition,  the Arbitration Demand requests damages,  interest and
attorneys fees. The Company is contesting PTG's claims and intends to defend the
action vigorously. Management believes that the ultimate resolution of the above
Arbitration  Demand  will not have a material  adverse  effect on the  Company's
financial position,  results of operations,  and cash flows or on the likelihood
that the proposed transaction with PTG will be consummated.

<PAGE>


              TRANSWORLD TELECOMMUNICATIONS, INC. AND SUBSIDIARIES

                   Notes to Consolidated Financial Statements


                Supplemental  Agreement. On January 23, 1996 (effective November
9, 1995),  the Company signed an agreement  with Videotron and other  affiliated
parties  to  define  procedures  to  completing  the PTG  Agreement,  amend  the
Settlement Agreement to conform with the terms of the PTG Agreement, and provide
WHI and  Videotron  Tampa Bay with  operational  funding  until the  transaction
contemplated under the PTG Agreement closes.

                As part of this agreement,  Videotron  agreed to provide funding
to WHI and  Videotron  Tampa  Bay to enable  them to  perform  their  respective
obligations  under the PTG Agreement until the transactions  contemplated  under
the PTG Agreement are consummated.

     Note  Extension.  On January 1, 1996,  the Company  signed an  agreement to
extend the payment  date of the note due to the father of the  president  of the
Company to January 1, 1997. The note and accrued  interest will continue to bear
interest at 12 percent.

<PAGE>


                                   SIGNATURES

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

                                      TRANSWORLD TELECOMMUNICATIONS, INC.
  10/25/96                             /s/ LANCE D'AMBROSIO
Date                                   Lance D'Ambrosio
                                       President and Chief Executive Officer
                                       (Principal Executive Officer)


  10/25/96                              /s/ ANTHONY SANSONE
Date                                    Anthony Sansone,
                                        Treasurer and Assistant Secretary
                                        (Principal Accounting Officer)


DIRECTORS

  10/25/96                              /s/ F. LORENZO CRUTCHFIELD, JR.
Date                                    F. Lorenzo Crutchfield, Jr.


  10/25/96                              /s/ LANCE D'AMBROSIO
Date                                    Lance D'Ambrosio


  10/25/96                              /s/ TROY D'AMBROSIO
Date                                   Troy D'Ambrosio


  10/25/96                              /s/ E. ANDREW LOWE
Date                                    E. Andrew Lowe


  10/25/96                              /s/ WALLACE T. BOYACK
Date                                    Wallace T. Boyack


  10/25/96                             /s/ R. BRET JENKINS
Date                                   R. Bret Jenkins


  10/25/96                             /s/ GEORGE SORENSON
Date                                   George Sorenson