As filed with the Securities and Exchange Commission on January 14, 1999.

===============================================================================

                       SECURITIES AND EXCHANGE COMMISSION
                              WASHINGTON, DC. 20549

                                   FORM 10-QSB

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

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

                     For the Quarter Ended November 30, 1998

                        Commission file number 000-28506

                      AMERICAN DIGITAL COMMUNICATIONS, INC.
        (EXACT NAME OF SMALL BUSINESS ISSUER AS SPECIFIED IN ITS CHARTER)


                 WYOMING                               13-3411167
        (State of Incorporation)                 (IRS. EMPLOYER ID NO.)

            745 FIFTH AVENUE
         SUITE 900, NEW YORK, NY                         10151
(Address of Principal Executive Offices)               (Zip Code)

                                 (212) 486-7424
                  (Registrant's Telephone No. incl. area code)


Indicate by check mark whether the registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the  preceding 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 [ ]


The number of shares  outstanding  of each of the  Registrant's  class of common
equity, as of January 8, 1999 are as follows:

               Class of Securities                   Shares Outstanding
         -------------------------------            --------------------
          Common Stock, $.0001 par value                  25,127,886

================================================================================

                      American Digital Communications, Inc.


<PAGE>

                                      INDEX




 PART I           Financial Information

        Item 1.   Financial Statements
                  Balance Sheet..........................................   3
                  Statements of Operations and Comprehensive Income......   5
                  Statements of Cash                                        6
                  Flows..................................................
                  Notes to Financial Statements..........................   7

       Item 2.    Management's Discussion and Analysis or 
                    Plan of Operations..................................    8




 PART II.         Other Information
     Items 1 - 5. ......................................................   12

        Item 6.   Exhibits and Reports on Form 8-K
                  A)       Exhibit 27 Financial Data Schedule..........    13
                      B)   Form 8-K  -  None

                                                                           
                  Signatures...........................................    14


<PAGE>

                  American Digital Communications, Inc.
                              Balance Sheet
                                   (UNAUDITED)





<TABLE>
<CAPTION>

ASSETS                                                                             November 30,    February 28,
------                                                                             ------------    ------------
                                                                                           1998             1998
                                                                                           ----             ----
<S>                                                                                     <C>               <C>   
Current Assets:
    Cash, restricted (see notes to financial statements)                                123,624           19,558
     Notes receivable                                                                     8,548            8,548
     Due from related parties                                                                 -                -
     Marketable securities, pledged (see notes to financial statements)                 632,690        1,209,844
-----------------------------------------------------------------------------------------------------------------

                  Total current assets                                                  764,862        1,237,950
-----------------------------------------------------------------------------------------------------------------

Property and equipment:
      Office equipment                                                                  129,439          125,052
      Furniture and fixtures                                                             26,082           26,082

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

                                                                                        155,521          151,134
          Less:    Accumulated depreciation                                             147,733          146,370
-----------------------------------------------------------------------------------------------------------------
              Net property and equipment                                                  7,788            4,764

Other assets:
      Distribution rights, net of amortization                                          140,481          201,672
      TrackPower trademarks and other intellectual property rights                      398,412          398,412
-----------------------------------------------------------------------------------------------------------------
             Total other assets                                                         538,893          600,084

            TOTAL ASSETS                                                              1,311,543        1,842,798
-----------------------------------------------------------------------------------------------------------------

</TABLE>


                 See accompanying notes to financial statements.

<PAGE>


                      American Digital Communications, Inc.
                                  Balance Sheet
                                   (UNAUDITED)
<TABLE>
<CAPTION>


LIABILITIES AND SHAREHOLDERS' EQUITY                                                November 30,   February 28,
------------------------------------                                                ------------   ------------
                                                                                            1998            1998
                                                                                            ----            ----
<S>                                                                                      <C>             <C>    
Current Liabilities:
      Accounts payable                                                                   427,241         243,716
      Accounts payable - related parties                                                  12,576          36,289
      Accrued expenses                                                                     1,302          59,193
      Accrued interest - related parties                                                  91,527          40,294
      Notes payable                                                                      850,000               -
      Notes payable - related parties                                                     30,370          30,370
      Current portion of capital lease obligations                                         5,951           5,075
      Current portion of long term note                                                  157,461               -
-----------------------------------------------------------------------------------------------------------------

                  Total current liabilities                                            1,576,428         414,937

Long term debt:
      Capital lease obligations                                                                -             876
      Long term note payable - related party                                                   -         157,461
-----------------------------------------------------------------------------------------------------------------

           Total long term debt                                                                -         158,337


Shareholders' equity:
       Convertible   preferred   stock,  no  par  value,   unlimited  shares           1,000,000       1,000,000
authorized, (liquidation value $1,000,000)
     Common stock,  $.0001 par value;  Unlimited shares  authorized,  issued               2,518           2,412
and outstanding  25,127,886  shares,  issued and  outstanding  24,113,624 on
February 28, 1998.
       Additional paid in capital                                                      7,172,299       6,986,409
      Common stock subscribed (214,262 - 1998)                                                 -          41,995
       Accumulated deficit                                                            (8,193,675)     (6,905,424)
       Accumulated other comprehensive income                                           (246,027)        144,132
-----------------------------------------------------------------------------------------------------------------

                  Total shareholder's equity                                            (264,885)      1,269,524
-----------------------------------------------------------------------------------------------------------------

TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY                                             1,311,543       1,842,798
-----------------------------------------------------------------------------------------------------------------
</TABLE>




                 See accompanying notes to financial statements.

<PAGE>



                      American Digital Communications, Inc.
                Statements of Operations and Comprehensive Income
                                   (UNAUDITED)

<TABLE>
<CAPTION>

                                                                     Three Months Ended            Nine Months Ended
                                                                        November 30,                 November 30,

                                                                    1998          1997             1998          1997
                                                                    ----          ----             ----          ----
<S>                                                              <C>            <C>               <C>         <C> 
Revenue
       Two way radio sales                                               -              -               -       113,275
       220 mHz tower equipment sales                                     -      3,696,000               -     4,051,000
       Gain on sale of marketable securities                         6,849              -           6,849             -
      Royalties from distribution rights                             2,378              -          10,125             -
 -----------------------------------------------------------------------------------------------------------------------
           Total revenue                                             9,227      3,696,000          16,974     4,164,275

 Costs and expenses:
       General and administrative                                  235,563         87,451         906,722       302,691
       Cost of equipment sales                                           -              -               -        81,667
       Cost of 220 MHz equip./Distribution rights                        -      3,229,302               -     3,941,784
       Financing costs                                              25,522              -         287,170             -
       Non-recurring Denver office costs                                 -              -          48,778             -
       Depreciation and amortization                                20,850          1,021          62,554        19,297
 -----------------------------------------------------------------------------------------------------------------------

        Total costs and expenses                                   281,935      3,317,774       1,305,224     4,345,439
 -----------------------------------------------------------------------------------------------------------------------
 Net loss                                                         (272,708)       378,226      (1,288,250)     (181,164)
 Other comprehensive income:
 Unrealized holding gain on marketable securities                  131,481              -        (390,159)            -
 -----------------------------------------------------------------------------------------------------------------------
 Comprehensive loss                                               (141,227)       378,226      (1,678,409)     (181,164)
 -----------------------------------------------------------------------------------------------------------------------

 Net loss per share of common stock                                  (0.01)          0.02           (0.07)        (0.01)
 -----------------------------------------------------------------------------------------------------------------------

 Weighted average number of common shares outstanding           25,127,886     23,448,407      24,897,330    22,627,431
 -----------------------------------------------------------------------------------------------------------------------
</TABLE>


                 See accompanying notes to financial statements.

<PAGE>


                      American Digital Communications, Inc.
                            Statements of Cash Flows
                                   (UNAUDITED)
<TABLE>
<CAPTION>

                                                                    Three Months Ended           Nine Months Ended
                                                                       November 30,                November 30,

   Increase (Decrease) in Cash
                                                                      1998          1997          1998           1997
                                                                      ----          ----          ----           ----
   -------------------------------------------------------------------------------------------------------------------
   Net cash used in operations
<S>                                                               <C>           <C>         <C>              <C>      
       Net loss                                                   (272,708)     (378,226)   (1,288,250)      (181,164)
         Adjustments to reconcile net loss
           to net cash used in operating activities:
           Depreciation and amortization                            20,850        13,099        62,554         48,917
             Gain on sale of marketable securities                  (6,849)            -        (6,849)             -
             Loss on sale of fixed assets                                -       376,875             -        376,875
             Issuance of stock for bridge financing                      -             -       144,001              -
        Changes in:                                                                       
                Accounts receivable                                      -             -             -         21,110
                Due to related parties                              (1,012)            -       (23,713)             -
                Inventory                                                -             -             -        268,272
                Other current assets                                   300       136,015             -       (535,644)
                Accounts payable                                   195,713       (13,606)      183,525        (76,206)
                Accrued expenses                                       706             -       (57,891)        (4,933)
                Other accrued liabilities                           25,500       526,513        51,233         (2,571)
   -------------------------------------------------------------------------------------------------------------------
   Net cash used in operating activities                           (37,500)    1,040,247      (935,390)       (85,344)
   -------------------------------------------------------------------------------------------------------------------
   Cash flows from investing activities:
             Proceeds from sale of marketable securities           135,576             -       193,843              -
                 Sale/(purchase) of fixed assets                         -             -       (4,387)        240,000
   -------------------------------------------------------------------------------------------------------------------
   Net cash provided by (used in) investing activities             135,576             -       189,456        240,000
   -------------------------------------------------------------------------------------------------------------------
   Cash flows from financing activities:
             Proceeds from sale of common stock, net                     -             -             -          9,582
                 Payments of capital lease obligations                   -        (1,275)            -         (3,825)
                 Proceeds on issuance of notes payable                   -    (1,024,548)      850,000       (166,429)
   -------------------------------------------------------------------------------------------------------------------
   Net cash provided by (used in) financing activities:                  -    (1,025,823)      850,000       (160,672)
   -------------------------------------------------------------------------------------------------------------------

   -------------------------------------------------------------------------------------------------------------------
   Increase (decrease) in cash                                      98,076        14,424       104,066        (6,016)
   -------------------------------------------------------------------------------------------------------------------
   -------------------------------------------------------------------------------------------------------------------
   Cash,  beginning of period                                       25,548        11,261        19,558         31,701
   -------------------------------------------------------------------------------------------------------------------
   -------------------------------------------------------------------------------------------------------------------
   Cash,  end of period                                            123,624        25,685       123,624         25,685
   -------------------------------------------------------------------------------------------------------------------
</TABLE>


                 See accompanying notes to financial statements.


<PAGE>



                      American Digital Communications, Inc.

                          Notes to Financial Statements
                                November 30, 1998


         Summary of significant accounting policies

         Basis of presentation:

         The accompanying financial statements have been prepared by the Company
without  audit.  In  the  opinion  of  management,  the  accompanying  unaudited
financial  statements  contain  all  adjustments   (consisting  of  only  normal
recurring  accruals) necessary for a fair presentation of the financial position
as of November 30, 1998 and February 28, 1998, and the results of operations and
cash flows for the periods ended November 30, 1998 and 1997.

         Nature of business:

         The Company was organized June 30, 1993 under the laws of Wyoming,  The
Company was in the  wireless  telecommunications  business  and had  intended to
provide  two-way  communications  in the 220 mHz. band. The Company held various
distribution  rights for certain Midland brand commercial land mobile radios and
radio parts. The distribution rights were acquired in separate transactions over
the last several years.  During fiscal year 1998 the Company sold,  sub-licensed
or wrote-off all remaining distribution rights. On January 15, 1998, the Company
acquired the TrackPower trade name and other  intellectual  property rights. The
technology  was in use in a small pilot  project of  approximately  100 homes in
southern Ontario,  Canada.  The service provided live horse racing on television
via Multi Point Microwave  Distribution System (MMDS) and the subscribers placed
wagers  using  Telephone  Account  Betting  (TAB).  The pilot  project  ended on
September 30, 1998,  after proving the  technology to be both  commercially  and
technically viable. All operating costs of the project have been expensed in the
relevant  period  which ended with the  termination  of the Ontario  Jockey Club
Agreement.  The Company plans to change the delivery system to a satellite based
system and to ultimately provide interactive  wagering through a set top box and
telephone line throughout North America. The pilot provided invaluable knowledge
that will be used in the  development of the new system.  Management has been in
discussions  with key  business  partners  and expects to launch the new service
early in calendar 1999. No revenues were  generated by the  TrackPower  business
during the third quarter.

         Certain  matters  discussed  in this  Quarterly  Report may  constitute
forward-looking   statements  within  the  meaning  of  the  Private  Securities
Litigation  Reform Act of 1995 (the  "Reform  Act") and as such may involve risk
and  uncertainties.  These  forward  looking  statements  relate to, among other
things,  expectations of the business environment in which the Company operates,
projections of future  performance,  perceived  opportunities  in the market and
statements   regarding  the  Company's  goals.  The  Company's  actual  results,
performance,  or  achievements  expressed  or  implied  in such  forward-looking
statements  may differ.  For  discussion  of the factors that might cause such a
difference,  see  Item  2  Management's  Discussion  and  Analysis  or  Plan  of
Operations.

         Use of estimates:

         The  preparation of financial  statements in conformity  with generally
accepted  accounting  principles  requires  management  to  make  estimates  and
assumptions  that  affect the  reported  amounts of assets and  liabilities  and
disclosure of  contingent  assets and  liabilities  at the date of the financial

<PAGE>


statements  and the  reported  amounts  of  revenues  and  expenses  during  the
reporting period. Actual results could differ from those estimates.

         Marketable securities:

         The  Company's   marketable   securities   consist  of  restricted  and
unrestricted  common stock of publicly traded companies.  The securities,  which
are pledged as  security  to a bridge  loan,  are  considered  held for sale and
therefore are recorded at market value at the balance sheet date.

         Depreciation:

         Office  equipment,  furniture  and  fixtures,  including  assets  under
capital leases, are stated at cost.  Depreciation is computed over the estimated
useful life of three years using the straight-line method.

         Amortization of distribution rights:

         The  cost  of  the  remaining  distribution  rights,  which  have  been
sub-licensed to a third party, is being amortized over the term of the agreement
(4 years).

         It is reasonably possible that revenues generated from the distribution
of products  pursuant to the  agreement  will not be sufficient to recover these
capitalized costs.

         Measurement of intangibles impairment:

         The  Company  annually  reviews the amount of the  recorded  intangible
assets for  impairment.  If the sum of expected  cash flows from these assets is
less than the carrying  amount of these  assets,  the Company will  recognize an
impairment loss in such period.

         Net loss per share:

         Basic loss per common share is based on the weighted  average number of
shares outstanding  during each period presented.  Options to purchase stock are
included as common stock equivalents when dilutive.

         Subsequent event:

         The Company sold a portion of marketable  securities during the current
quarter.  The cash  balance at November  30,  1998  represents  the  proceeds of
disposition.  Subsequent to the end of the quarter,  the Company repaid $127,500
of the bridge loan on a pro-rata basis. On December 31, 1998 the restricted cash
balance held for future repayment was $14,091.

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


         Overview

         The  business  focus  for  the  Company  has  changed  from a  wireless
telecommunications  distribution business to a development stage enterprise. The
focus of management is negotiating future business contracts and agreements. See
"Notes to Financial  Statements - Summary of Significant  Accounting  Policies -
Nature of Business".

         The  operating  losses  thus far during  fiscal 1998 are  generally  as
expected.  The Company has been incurring the necessary  costs to develop future
business relationships. During the first and second quarters of this fiscal year
the Company  borrowed  amounts  supported by its marketable  securities.  In the

<PAGE>


third quarter the Company sold a portion of the  marketable  securities in order
to generate cash for note repayment. Subsequent to the end of the fiscal quarter
the  Company  partially  repaid the bridge  loan.  Management  hopes to complete
certain key business contracts and agreements  shortly,  in order to provide the
necessary substance to attract permanent financing.

         Results of Operations

         For the three months ended November 30, 1998 and 1997:

         The  Company   continues  to  collect  a  nominal  royalty  on  Midland
distribution  rights. The remaining Midland  distribution  rights,  attracting a
royalty  stream,  are  from  certain  territories  in  Western  Canada  under  a
sub-license  agreement  with a third party.  Prior year  revenues of  $3,696,000
represents  the sale of the  Company's  220 mHz tower  equipment to Intek Global
Corporation.

         The Company sold 87,400  Intek shares  during the quarter at an average
price of $1.47 for total  proceeds of $128,327  representing  a nominal  gain of
$5,421.  The  Company  also sold  70,000  Ventel  shares at an average  price of
approximately $0.10 for total proceeds of $7,250 representing a gain of $1,428.

         The Company does not expect any revenues from the  TrackPower  business
until the new service is launched.

         General and administrative expenses were $235,563 in the third quarter,
a decrease of 36% over the prior quarter.  General and  administrative  expenses
totaled  $87,451 in the prior year and represent the overhead  required prior to
the change in the business direction of the Company.

         Financing costs totaled $25,522 during the second quarter.  These costs
were primarily interest.

         Depreciation  and  amortization  represents  the  amortization  of  the
remaining  Midland   distribution  rights  and  normal  depreciation  on  office
equipment.

         The closing trading value of the Company's  investment in common shares
of Intek  increased from $1.56 at August 31, 1998 to $1.84 at November 30, 1998.
The trading  value of Ventel  shares  closed at $.052.  Accordingly  the Company
recorded an unrealized holding gain on marketable securities of $131,481.

         For the nine months ended November 30, 1998 and 1997

         Royalty  revenue from the Western  Canada Midland  Distribution  Rights
totaled $10,125 in the first nine months of this year.  Prior year's revenues of
$113,275 and $4,051,000 represent the direct sale of Midland brand two radios in
licensed  territories  and  the  Company's  sale of 220 mHz  systems  to  Intek,
respectively.

         General and  administrative  expenses totaled $906,722 against $302,691
in the prior year.  Operating  expenses are substantially  higher than the prior
year due to the cost of developing the Trackpower infrastructure. Costs incurred
during the nine month period ended November 30, 1998 are costs  attributable  to
financing,  to develop the  Trackpower  technology,  to  negotiate  horse racing
content agreements and other business relationships.

         Financing  costs totaled  $287,170  during the first nine months of the
year.  These costs have been incurred to provide the funding of the new business
initiative.

<PAGE>


         During the nine months ended November 30, 1998 the Company  recorded an
unrealized holding loss on marketable  securities of $390,159 due to the decline
in value of the Company's Intek and Ventel shares.

         Financial Condition

         Total assets increased from $1,231,864 to $1,311,543 during the current
quarter.  The  increase is primarily a result of an increase in the market value
of the Company's marketable securities.

         At the  beginning  of this  fiscal  quarter  the  Company's  marketable
securities  consisted of 418,381 Intek shares and 499,999 Ventel shares.  During
the quarter  87,400 and 70,000  Intek and Ventel were sold.  As at November  30,
1998 the Company held 330,981 Intek shares and 429,999 Ventel shares. Subsequent
to the end of the quarter the Company repaid $127,5000 of the bridge loan.

         The TrackPower  trademarks and other  intellectual  property rights are
not being amortized until revenues begin to occur from the new business.

         The Company's  working  capital ratio declined from 0.6:1 at August 31,
1998 to  approximately  0.5:1 at November 30, 1998.  The change is primarily the
result of a $157,461 note payable to a related party now classified as current.

         Net equity of the Company also declined from a deficit of $123,657 to a
deficit of $264,885  during the quarter.  It is  anticipated  that the operating
losses prior to the  commencement  of its  operating  business  will continue to
accrue.

         Liquidity and Capital Resources

         The Company has been funding the development of the TrackPower business
through new debt.  Thus far in 1998 the Company has closed  bridge  financing of
135  Units,  representing  a  package  of  securities  including  total  debt of
$850,000.  The debt is on demand  basis and the  Company  has begun  selling the
marketable securities in order to repay the debt.

                  The  continued   weakness  in  the  value  of  the  marketable
securities  has  significantly  restricted  the Company's  liquidity and capital
resources. The current market value of the marketable securities is insufficient
to repay the bridge loan in its entirety.  A portion of the Company's marketable
securities became free trading during the quarter.  The Company  recognizes that
incremental working capital will be required to effect the  commercialization of
the  TrackPower  application  and is in the  process of planning  the  financing
strategy.

         Year 2000

         The  Company is engaged in a review of computer  systems  and  software
both internally and in connection with external business relationships.

         The  Company  will  have  access  ,  through  a  related  party,  to an
accounting platform which is Year 2000 compliant system during calendar 1999.

         The Company is developing the new Trackpower technology to be Year 2000
compliant.  The Company will, prior to consummating any new business agreements,
require Year 2000 compliance certification from the contracting party.


<PAGE>


PART II. Other Information

Item 1.           Litigation

         No  material  legal  proceedings  to which the Company is a party or to
which the  property of the  Company is subject is pending  and no such  material
proceeding is known by management of the Company to be contemplated. No material
legal  proceedings  to which any director,  officer of affiliate of the Company,
any owner of record or  beneficially  of more than five  percent of any class of
the voting  securities of the Company,  or security holder is a party adverse to
the Company or has a material interest adverse to the Company is pending.

Item 2.           Change in Securities

         Not applicable.

Item 3.           Defaults  Upon Senior Securities

         Not applicable.

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

         Not applicable.

Item 5.           Other Information

         Not applicable.

Item 6.           Exhibits and Reports on Form 8-K

Exhibits.         None.

EX-27                  Financial Data Schedule

Form 8-K None.



                                   SIGNATURES

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



DATE:   JANUARY 14, 1999         BY:

                                           /s/ John G. Simmonds
                                 -------------------------------------------
                                             John G. Simmonds
                                        President / CEO / Director
                                       (principal executive officer)


DATE:   JANUARY 14, 1999         BY:

                                           /s/ Gary N. Hokkanen
                                 -------------------------------------------
                                             Gary N. Hokkanen
                                         Chief Financial Officer,
                                       (principal financial officer)