SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549

                                   FORM 10-KSB
(Mark One)

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

                   For the Fiscal Year Ended December 31, 1995

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

                For the transition period from ______ to _______.

                           Commission File No. 0-6456

                               REACT SYSTEMS, INC.
                  ----------------------------------------------
                  (Name of small business issuer in its charter)

      Nevada                                              87-0287034
-------------------------------             ------------------------------------
(State or other jurisdiction of
 incorporation or organization)             (I.R.S. Employer Identification No.)

           1787 East Ft. Union Blvd., #106, Salt Lake City, Utah 84121
          ------------------------------------------------------------
               (Address of Principal Executive Offices) (Zip Code)

Registrant's Telephone Number, Include Area Code:  (801) 942-7722

Securities Registered Pursuant to Section 12(b) of the Act:

      Title of Each Class            Name of Each Exchange on Which Registered
      -------------------            -----------------------------------------
           None                                      None

Securities Registered Pursuant to Section 12(g) of the Act:

                          Common Stock, $.05 par value
                          ----------------------------
                                (Title of Class)

     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 twelve (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 ninety (90)
days. Yes     No  X  
         -----  -----

     Check  if  disclosure  of  delinquent  filers  in  response  to Item 405 of
Regulation S-B is not contained in this form, and will not 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. [X]

     The issuer's revenues for its most recent fiscal year were $0.

     As of August 30, 1996,  524,277  shares of common  stock of the  Registrant
were outstanding. As of such date, no market existed for the Registrant's common
stock.  Accordingly,  the  aggregate  market  value of the common  stock held by
non-affiliates was $0.

                       DOCUMENTS INCORPORATED BY REFERENCE

     No annual reports to security holders, proxy or information statements,  or
prospectuses  filed pursuant to Rule 424(b) or (c) are incorporated by reference
in this report.

      Transitional Small Business Disclosure Format:  Yes     No  X  
                                                         -----  -----

<PAGE>
                               TABLE OF CONTENTS

                                                                      Page
                                                                      ----

PART I - FINANCIAL STATEMENTS

      Item  1. Description of Business..................................3
      Item  2. Description of Properties................................3
      Item  3. Legal Proceedings........................................3
      Item  4. Submission of Matters to a Vote of Security Holders......3

PART II

      Item  5. Market for Common Equity and Related
               Stockholder Matters......................................4
      Item  6. Management's Discussion and Analysis.....................4
      Item  7. Financial Statements.....................................4
      Item  8. Changes in and Disagreements with Accountants on
               Accounting and Financial Disclosure......................5

PART III

      Item  9. Directors, Executive Officers, Promoters and 
               Control Persons; Compliance with Section
               16(a) of the Exchange Act................................5
      Item 10. Executive Compensation ..................................6
      Item 11. Security Ownership of Certain Beneficial Owners
               and Management...........................................6 
      Item 12. Certain Relationships and Related Transactions...........6
      Item 13. Exhibits and Reports of Form 8-K.........................7

SIGNATURES..............................................................8


                                        2

<PAGE>
                                     PART I

ITEM 1.  DESCRIPTION OF BUSINESS

Business Development

     React Systems,  Inc. (the  "Company")  was organized  under the laws of the
State of Nevada on November 18, 1955,  under the name "Dolomite King,  Inc." The
Company  was  originally  formed to engage in  mining  operations.  The  Company
subsequently changed its name and business on several occassions. Since December
of 1974, the Company has been dormant other than undertaking  limited efforts in
the last year to acquire an operating business.

     Subsequent to December 31, 1995, in connection  with the Company's  efforts
to acquire  an  operating  business,  in August of 1996 the  Company  declared a
1-for-30  reverse stock split and issued 63,500 shares of common stock to Jensen
Services,  Inc. and 100,000  shares to each of the Company's  three officers and
directors  for services  rendered.  Following  the reverse split and issuance of
shares in August of 1996,  the Company had 524,227 shares of common stock issued
and outstanding.

Business

     Since 1974, the Company has not engaged in any material business operations
other than its limited efforts to seek and acquire and operating business.

ITEM 2.  DESCRIPTION OF PROPERTY

     The Company has no properties or assets.  Jensen Services  provides offices
for use in performing administrative matters free of charge.

ITEM 3.   LEGAL PROCEEDINGS

     The Company is not the subject of any pending legal proceedings; and to the
knowledge of management,  no proceedings are presently  contemplated against the
Company by any federal, state or local governmental agency.

     Further,  to the knowledge of management,  no director or executive officer
is party to any action which any has an interest adverse to the Company.

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

     No matters were submitted to a vote of the Company's  stockholders  through
the  solicitation  of proxies  or  otherwise,  during the fourth  quarter of the
Company's fiscal year ended December 31, 1995.


                                        3

<PAGE>
                                     PART II

ITEM 5.  MARKET FOR COMMON EQUITY AND RELATED STOCKHOLDER MATTERS

Market Information

     There is presently no established  trading market for the Company's  common
stock.  The Company  intends to apply for listing of its common stock on the OTC
Bulletin  Board.  Management does not expect any public market to develop in the
Company's common stock unless and until the Company  completes an acquisition or
merger,  if ever.  There can be no assurance  that any such trading market which
may develop will be sustained.

Holders

     The number of record  holders of the Company's  common stock as of December
31,  1995 was 603.  This  number  does not  include an  indeterminate  number of
stockholders whose shares are held by brokers in street name.

Dividends

     The Company has not paid any  dividends  with respect to its common  stock,
and does not intend to pay dividends in the foreseeable future.

ITEM 6.  MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION

Plan of Operation

     The Company has not engaged in any material operations in the period ending
December 31, 1995, or since December 31, 1974.  The Company  intends to continue
to seek  out the  acquisition  of  assets,  property  or  business  that  may be
beneficial to the Company and its stockholders.

     The Company's only foreseeable cash requirements  during the next 12 months
are expected to relate to maintaining  the Company in good standing in the State
of Nevada,  and keeping its records  current  with the  Securities  and Exchange
Commission.  The Company anticipates that Jensen Services and other shareholders
will advance funds as needed to meet the  Company's  cash  requirements  for the
foreseeable  future.  No  obligation  exists,  however,  pursuant  to which  any
shareholders, or other persons, have agreed to provide funding to the Company.

Results of Operations

     The Company has had no operations since December of 1974.

ITEM 7.  FINANCIAL STATEMENTS

     See page F-1 for an index of the financial statements included herewith.


                                      4
<PAGE>
ITEM 8.     CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND
            FINANCIAL DISCLOSURE

      Not applicable.

                                    PART III

ITEM 9.     DIRECTORS, EXECUTIVE OFFICERS, PROMOTERS AND CONTROL PERSONS;
            COMPLIANCE WITH SECTION 16(a) OF THE EXCHANGE ACT

Identification of Directors and Executive Officers

     The  following  table  sets forth the names,  nature of all  positions  and
offices held by all directors and executive  officers of the Company at December
31,  1995 and as of the date of this  report,  and the period or periods  during
which  each  such  director  or  executive  officer  has  served  in  his or her
respective positions.

       Name                      Position(s) Held              Term of Office
-------------------        ---------------------------------   ---------------

Thomas J. Howells........  President and Director              4/95 to Present
Joyce Kaufer.............  Vice President and Director         4/95 to Present
Stacie H. Jensen.........  Secretary, Treasurer and Director   4/95 to Present

Term of Office

     The terms of office of the current  officers and directors  shall  continue
until the next annual meeting of stockholders.

Business Experience

     Thomas J.  Howells,  age 24, has served as President  of the Company  since
April of 1995. Mr.  Howells is an investment  consultant  with Jensen  Services,
Inc., a privately held mergers and  acquisition  firm.  Previously,  Mr. Howells
served as Chief Financial Officer of Eccles Lines & Designs, Inc.

     Joyce  Kaufer,  age 24, has served as Vice  President and a Director of the
Company since April of 1995. Ms. Kaufer has served as an account  executive with
Citadel  Broadcasting  since 1993.  Previously,  Ms. Kaufer served as an account
executive  for U.S.  Radio  Group from 1992 to 1993 and as  business  manager of
Radio Management Service from 1991 to 1992.

     Stacie H. Jensen, age 26, has served as Secretary, Treasurer and a Director
of the Company since April of 1995. Ms. Jensen is employed as a loan officer for
American  Lending Network.  Previously,  Ms. Jensen served as a loan officer for
Mortgage  Associates,  Inc. from 1995 to 1996, and as a marketing  assistant for
Northwestern Mutual Life and Baird Securities from 1993 to 1995.

Compliance with Section 16(a) of the Exchange Act

     Under the securities  laws of the United States,  the Company's  directors,
its  executive  officers,  and any persons  holding more than ten percent of the
Company's  Common Stock are required to report  their  initial  ownership of the
Company's  Common  Stock and any  subsequent  changes in that  ownership  to the
Securities  and Exchange  Commission.  Specific due dates for these reports have
been established and the Company is required to disclose in this Proxy Statement
any failure to file by these dates during 1995.  All of the filing  requirements
were  satisfied on a timely  basis in 1995.  In making  these  disclosures,  the
Company has relied  solely on written  statements  of its  directors,  executive
officers  and  shareholders  and copies of the reports  that they filed with the
Commission.


                                        5
<PAGE>
ITEM 10. EXECUTIVE COMPENSATION

     No cash  compensation  was paid to any of the  officers or directors of the
Company  during  1994  or  1995.  Each of the  Company's  present  officers  and
directors, being Thomas J. Howells, President and Chief Executive Officer, Joyce
Kaufer,  Vice  President,  and Stacie H. Jensen,  Secretary/Treasurer,  received
100,000 shares of common stock for services rendered during 1995.

     The  Company  has no  employment  agreements  with any of its  officers  or
directors.  Additionally,  there  are no  compensatory  plans  or  arrangements,
including payments to be received from the Company,  with respect to any officer
or director which would in any way result in payments to any such person because
of his or her  resignation,  retirement  or other  termination  of such person's
employment with the Company or its subsidiaries, or any change in control of the
Company,  or a change in the  person's  responsibilities  following  a change in
control of the Company.

ITEM 11. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT

     The  following  table is  furnished  as of August  31,  1996,  to  indicate
beneficial  ownership  of  shares  of the  Company's  Common  Stock  by (1) each
shareholder of the Company who is known by the Company to be a beneficial  owner
of more than 5% of the Company's  Common Stock,  (2) each director,  nominee for
director and Named  Officer of the Company,  individually,  and (3) all officers
and directors of the Company as a group.  The information in the following table
was provided by such persons.

    Name and Address             Amount and Nature of
   of Beneficial Owner          Beneficial Ownership(1)   Percent of Class

Thomas J. Howells..............        100,000                  19.1%
 2071 E. Royal Harvest Way #11
 Salt Lake City, UT 84121
Joyce Kaufer...................        100,000                  19.1%
 2559 East 3020 South
 Salt Lake City, UT 84109
Stacie H. Jensen...............        100,000                  19.1%
 1419 E. Noelle Rd.
 Salt Lake City, UT 84092
Jensen Services, Inc...........         96,834                  18.5%
 1787 E. Fort Union Blvd. #106
 Salt Lake City, UT 84121
All executive officers and directors
 as a group (3 persons)........        300,000                  57.3%

Changes in Control

     To the  knowledge  of  management,  there are no  present  arrangements  or
pledges of  securities of the Company which may result in a change in control of
the Company.

ITEM 12. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

     During the two  calendar  years  ended  December  31,  1995,  there were no
material  transactions  or any  currently  proposed  transactions,  or series of
similar transactions, to which the Company was or is to be a party, in which the
amount involved exceeds $60,000 and in which any director or executive  officer,
or any  security  holder  who  is  known  to the  Company  to own of  record  or
beneficially  more than 5% of any class of the Company's  common  stock,  or any
member of the immediate family of any of the foregoing persons, had an interest.


                                        6
<PAGE>
ITEM 13. EXHIBITS AND REPORTS ON FORM 8-K

(a)  Exhibits

     Exhibit
      Number      Description of Exhibit
     -------      ----------------------

       3.1    Articles of Incorporation, as amended *
       3.2    Bylaws, as amended *

      ---------------
      *   Incorporated by reference pursuant to Exchange Act Rule 12b-23.

(b)  Reports on Form 8-K

     No reports on Form 8-K were filed by the Company  during the quarter  ended
     December 31, 1995.


                                       7
<PAGE>
                                   SIGNATURES

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

                                              REACT SYSTEMS, INC.


Date:  September 3, 1996                  By:  /s/ Thomas J. Howells
                                             ----------------------------------
                                             Thomas J. Howells
                                             President


     Pursuant to the  requirements  of the  Securities  Exchange Act of 1934, as
amended, this Report has been signed below by the following persons on behalf of
the Registrant and in the capacities and on the dates indicated:


/s/ Thomas J. Howells   President and Director        September 3, 1996
----------------------- (Principal Executive Officer)
Thomas J. Howells

/s/ Joyce Kaufer        Vice President and Director   September 3, 1996
-----------------------
Joyce Kaufer


Stacie H. Jensen        Treasurer and Director        September 3, 1996
----------------------- (Principal Financial Officer)
Stacie H. Jensen



SUPPLEMENTAL  INFORMATION TO BE FURNISHED WITH REPORTS FILED PURSUANT TO SECTION
15(d) OF THE ACT BY REGISTRANTS WHICH HAVE NOT REGISTERED SECURITIES PURSUANT TO
SECTION 12 OF THE ACT

     No annual report or proxy material has been forwarded to securities holders
of the  Registrant  during the period  covered by this Report;  however,  if any
annual report or proxy  material is furnished to security  holders in connection
with the annual meeting of  stockholders  to be held in 1996, a copy of any such
annual report or proxy materials shall be forwarded to the Commission when it is
forwarded to security holders.


                                        8

<PAGE>
                               REACT SYSTEMS, INC.

                          Index to Financial Statements

                                                                  Page
                                                                 Number
                                                                 ------

            Independent Accountants' Report                     F-2

            Balance Sheet - December 31, 1995                   F-3

            Statements of Operations for the Years Ended
            December 31, 1995 and 1994                          F-4

            Statements of Stockholders' Equity (Deficit)
            for the Years Ended December 31, 1995 and 1994      F-5

            Statements of Cash Flows for the Years Ended
            December 31, 1995 and 1994                          F-6

            Notes to Financial Statements                       F-7


                                       F-1

<PAGE>
                   MANTYLA, McREYNOLDS AND ASSOCIATES, C.P.A's
                           A Professional Corporation


                          Independent Auditors' Report


The Board of Directors and Shareholders
React Systems, Inc.

     We have audited the accompanying balance sheet of React Systems, Inc. as of
December 31,  1995,  and the related  statements  of  operations,  stockholders,
deficit,  and cash flows for the years ended  December 31, 1995 and December 31,
1994.  These  financial  statements  are  the  responsibility  of the  Company's
management.  our  responsibility  is to express  an  opinion on these  financial
statements based on our audit.

     We conducted  our audit 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 audit provides a reasonable basis for our opinion.

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

     The  accompanying  financial  statements  have been prepared  assuming that
React Systems,  Inc. will continue as a going concern. As discussed in note 2 to
the financial  statements,  the Company has accumulated  losses from operations,
has no assets,  and has a net working capital  deficiency that raise substantial
doubt about its ability to continue as a going  concern.  Management's  plans in
regard to these matters are also  described in note 2. The financial  statements
do not  include  any  adjustment  that  might  result  from the  outcome of this
uncertainty.


                                     BY:  MANTYLA, McREYNOLDS & ASSOCIATES
                                          -------------------------------------
                                          MANTYLA, McREYNOLDS & ASSOCIATES

Salt Lake City, Utah
June 4, 1996


                                       F-2

<PAGE>
                               REACT SYSTEMS, INC.
                                  Balance Sheet
                                December 31, 1995

<TABLE>
<CAPTION>
                                     ASSETS
<S>                                         <C>
Assets                                      $               0
                                            -----------------

     Total Assets                           $               0
                                            =================


                      LIABILITIES AND STOCKHOLDERS' DEFICIT
<S>                                         <C>

Liabilities:
  Current Liabilities:
     Note payable - note 4                  $         94,300
                                            ----------------

     Total Current Liabilities                        94,300
                                            ----------------

     Total Liabilities                                94,300
                                            ----------------

Stockholders' Deficit:
     Common stock, $.05 par value;
     authorized 50,000,000 shares; issued
     and outstanding 2,984,118 shares                149,206

Additional paid in capital                           344,600
Accumulated deficit                                 (588,106)
                                            ----------------

Total Stockholders' Deficit                          (94,300)
                                            ----------------

Total Liabilities and Stockholders Deficit  $              0
                                            ================
</TABLE>


                 See accompanying notes to financial statements


                                       F-3
<PAGE>
                               REACT SYSTEMS, INC.
                            Statements of Operations
           For the Years Ended December 31, 1995 and December 31, 1994
<TABLE>
<CAPTION>

                                            1995            1994
                                         ---------       ---------
<S>                                      <C>             <C>

Revenue:
   Revenues from operations              $       0        $        0
                                         ---------        ----------

          Total Revenue                          0                 0

General and Administrative Expenses              0                 0
                                         ---------        ----------

   Net income before taxes                       0                 0

   Income taxes                                  0                 0
                                        ----------        ----------

   Net income                           $        0        $        0
                                        ==========        ==========

Loss per share                          $     0.00        $     0.00
                                        ==========        ==========

Weighted Average Shares Outstanding      2,984,118         2,984,118
                                        ==========        ==========

</TABLE>


                 See accompanying notes to financial statements


                                       F-4

<PAGE>
                               REACT SYSTEMS, INC.
             Statements of Stockholders' Deficit For the Years Ended
                     December 31, 1995 and December 31, 1994

<TABLE>
<CAPTION>

                                            Additional                   Net
                                  Common     Paid-in   Accumulated  Stockholders'
                                   Stock     Capital     Deficit       Deficit
                                 ---------  ---------  -----------  ------------

<S>                              <C>        <C>        <C>          <C>

Balance, December 31, 1993       $ 149,206  $ 344,600  $ (588,106)  $ (94,300)

Net income for the year
ended December 31, 1994                                         0           0
                                 ---------  ---------  ----------   ---------

Balance, December 31, 1994       $ 149,206  $ 344,600  $ (588,106)  $ (94,300)

Net income for the year
ended December 31, 1995                                         0           0
                                 ---------  ---------  ----------   ---------

Balance, December 31, 1995       $ 149,206  $ 344,600  $ (588,106)  $ (94,300)
                                 =========  =========  ==========   =========
</TABLE>


                 See accompanying notes to financial statements.


                                       F-5
<PAGE>
                               REACT SYSTEMS, INC.
                            Statements of Cash Flows
           For the Years Ended December 31, 1995 and December 31, 1994
<TABLE>
<CAPTION>

                                                    1995               1994
                                                 ----------          --------
<S>                                              <C>                 <C>

Cash Flows Provided by operating Activities:

Net Loss                                         $        0          $      0

Adjustments to reconcile net income to net
   cash provided by operating activities:                 0                 0
                                                 ----------          --------

Net Cash Provided by operating Activities                 0                 0

Cash Flows Provided by Financing Activities               0                 0

Cash Flows Provided by Investing Activities               0                 0
                                                 ----------          --------

Net Increase in cash                                      0                 0

Beginning Cash                                            0                 0
                                                 ----------          --------

Ending Cash                                      $        0          $      0
                                                 ==========          ========

Supplemental Disclosure of Cash
 Flow Information

Cash paid during the periods for:
   Interest                                      $        0         $       0
                                                 ==========         =========

Taxes                                            $        0         $       0
                                                 ==========         =========
</TABLE>


                 See accompanying notes to financial statements


                                       F-6
<PAGE>
                               REACT SYSTEMS, INC.
                          Notes to Financial Statements
                                December 31, 1995

Note 1. Organization and Summary of Significant Accounting Policies

     (a) Organization

          React Systems, Inc. [Company] incorporated under the laws of the State
          of Nevada in 1955. The Company has been dormant for a number of years.

     (b) Income Taxes

          Effective  April 1,  1993,  the  Company  adopted  the  provisions  of
          Statement of Financial  Accounting  Standards No. 109 [the Statement],
          "Accounting  for Income  Taxes." The  Statement  requires an asset and
          liability  approach for financial  accounting and reporting for income
          taxes,  and the recognition of deferred tax assets and liabilities for
          the temporary  differences  between the financial  reporting bases and
          tax bases of the Company's assets and liabilities at enacted tax rates
          expected  to be in effect when such  amounts are  realized or settled.
          The cumulative effect of this change in accounting for income taxes as
          of December 31, 1995 is $0 due to the valuation allowance  established
          as described below.

     (c) Net Income Per Common Share

          Net income per common share is based on the weighted average number of
          shares outstanding.

     (d) Statement of Cash Flows

          For purposes of the  statements of cash flows,  the Company  considers
          cash on deposit  in the bank to be cash.  The  Company  has $0 cash at
          December 31, 1995.

Note 2. Liquidity

     The Company has accumulated  losses through  December 31, 1995 amounting to
     $588,106, has no assets, has a net working capital deficiency of $94,300 at
     December 31, 1995, and does not anticipate generating sufficient cash flows
     from  operations to meet the  Company's  cash  requirements.  These factors
     raise  substantial doubt about the Company's ability to continue as a going
     concern.

     Management's plans include seeking a  well-capitalized  merger candidate to
     recommence  its  operations.  The  financial  statements do not include any
     adjustments that might result from the outcome of this uncertainty.


                                       F-7
<PAGE>
Note 3. Income Taxes

     The Company  adopted  Statement  No. 109 as of April 1, 1993.  Prior years,
     financial  statements  have not been  restated to apply the  provisions  of
     Statement No. 109. No provision has been made in the consolidated financial
     statements for income taxes because the Company has accumulated substantial
     losses from operations.

     The tax  effects of  temporary  differences  that give rise to  significant
     portions of the  deferred  tax asset at December 31, 1995 have no impact on
     the financial  position of the Company.  A valuation  allowance is provided
     when it is more likely than not that some portion of the deferred tax asset
     will not be realized.  Because of the lack of taxable earnings history, the
     Company has  established a valuation  allowance  for all future  deductible
     temporary differences.

Note 4. Note Payable

     The Company has an unsecured note payable to a law firm (of which a partner
     is also a shareholder  of equity  securities  of the  Company).  On May 22,
     1996, the Board of Directors of React Systems, Inc. authorized the issuance
     of 50,000  shares of common  stock of the Company in exchange for a "Waiver
     of Debt" which dissolved all of the balance due on the note.


                                       F-8