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

                                   FORM 10-QSB

(Mark One)

|X|   QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT
      OF 1934

      For the quarterly period ended September 30, 2002

|_|   TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE EXCHANGE ACT

      For the transition period from _________________ to _________________

                         Commission file number: 0-30463

                               R-Tec Holding, Inc.
                 [Exact name of business issuer in its charter]

Idaho                                       82-0515707
(State or other jurisdiction of             (I.R.S. Employer Identification No.)
incorporation of organization)

1471 E. Commercial Ave., Meridian, Idaho    83642
(Address of principal executive offices)    (Zip Code)

Issuers Telephone Number: (208) 887-0953    Fax: (208) 888-1757

The number of shares of common stock outstanding as of September 30, 2002, is
21,052,005.

Transitional Small Business Disclosure Format (Check one): Yes |_| No |X|
<PAGE>

                         PART I - FINANCIAL INFORMATION

Forward Looking Statements and Risk Factors

      This form 10-QSB contains certain forward-looking statements which are
based on management's current expectations. The Company has identified risk
factors which could cause actual results to differ substantially from the
forward looking statements. These risk factors include, but are not limited to:
general economic conditions, current industry specific trends, variability in
time line of new product developments, new product acceptance, difficulties in
manufacturing new products in large volume, economic viability of our customers
and vendors, changes in legislation, the ability to obtain adequate capital
funding for product development and expansion, and the availability of qualified
employees.

Item 1. Financial Statements:

      The following financial statements are filed as part of this report:

      The Consolidated Financial Statements of the Company for the three months
and nine months ended September 30, 2002 and 2001.

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

Financial Results of Operations:

      Sales for the three months ended September 30, 2002 were $754,826,
compared to $283,167 for the period ending September 30, 2001, an increase of
$471,659 or 167%. This increase of 167% is due primarily to an increase in
booked sales in the second quarter of 2002 and subsequent, invoiced sales
resulting in the third quarter of 2002. Operating expenses were $382,810, or 51%
of sales for the period ending September 30, 2002 compared to 321,151, or 113%
of sales for the period ending September 30, 2001. The decrease in operating
expenses as a percent of sales from 2001 to 2002, respectively for the three
months ending September 30, is in line with management's attention to increasing
product and job margins.

      Selling, general and administrative expenses were $475,154, or 63% of
sales for the three months ending September 30, 2002, compared to $525,630 or
186% of sales for the same period ended September 30, 2001. The decrease in
selling, general and administrative expenses of $50,476 reflects management's
attempts to control overhead expenditures.

      Net loss for the three months ended September 30, 2002 was ($141,817),
compared to a net loss of ($583,016) for the same period ended September 30,
2001. The decrease in net loss is primarily attributable to increases in gross
margins on jobs.

Changes in Financial Condition:

      The following discussion and analysis should be read in conjunction with
the financial statements and notes thereto appearing elsewhere herein for
September 30, 2002 and September 30, 2001.
<PAGE>

      Current assets were $849,510 for the period ending September 30, 2002,
compared to $558,943 for the period ending December 31, 2001, an increase of
$290,567, or 52%, respectively. The increase in current assets of $290,567 is
attributable primarily to an increase in accounts receivable of $291,987, for
the periods respectively. As of September 30, 2002, current liabilities were
$1,006,592 compared to $394,734 for the same period 2001. The increase in
current liabilities resulted in a current ratio as of September 30, 2002 of
0.84. The decrease in the current ratio from 1.42 at September 30, 2001 to 0.84
at September 30, 2002 is due primarily to an increase in short term borrowing of
approximately $558,922 on convertible notes with maturity dates of one year or
less, from September 30, 2001 to 2002 respectively. Accounts payable, accrued
expenses, current portions of leases payable, and billings in excess of costs
and estimated earnings on uncompleted contracts, increased by $52,936, September
30, 2001 to 2002 respectively.

Liquidity:

      Management is aware that insufficient liquidity exists in the short term
and is seeking alternative methods of rebuilding strength in the short term
liquidity ratios. The current ratio was 0.84 at September 30, 2002, as
previously discussed. Although the short term liquidity ratio weakness is due in
part to the significant increase in short term note borrowings, management
recognizes the importance of initiating planning efforts now to deal with the
retirement of the notes as they become due.

Funding and Capital Resources:

      Adequate funding of capital resources continues to remain a major focus of
management's efforts. As the Company's stock price has continued to decline
through recent quarters, management has sought alternative, temporary methods of
funding using convertible debt instruments, or notes, as described previously.
The convertible notes allow for either a repayment of the face value of the note
or a conversion at the option of the holder to the Company's stock for 75% of
the stock price on the date of maturity. Interest is paid monthly at the rate of
12% per annum of the face value of the note. The premise for using these types
of debt instruments is to replace them with a conversion to equity as the
Company's stock increases in price by the maturity date of the instruments. To
the extent the Company's stock price has increased at the maturity date of the
instruments, and the holders of the instruments convert to equity at a higher
stock price than current stock price levels, management feels it will have
minimized the cost of capital for current funding needs. At the time of filing,
the Company's stock is trading in the relative range of $.13 per share of common
stock with nominal volatility and small volumes of trading.

      Of the capital funding sought in recent quarters, approximately $475,879
has been used for the research and development and construction of a production
facility for the manufacture of Interconnect products, including the patented
GCI(TM) testing interface for the Integrated Circuit industry. As of the date of
filing, all major construction, including leasehold improvements has been
completed and the Company does not expect any additional, significant funding
needs for construction to bring "on-line" the new production facility. As the
new facility comes on line, and sales increase, it is anticipated that some
ancillary equipment will need to be purchased to

<PAGE>

handle increased production volumes. The major equipment items will be
additional micro-machining equipment, also know as lasers.

Plan of Operation:

      One of the top priorities of management is the objective to achieve
profitability as quickly as is reasonable given the current market environment.
In the automation product sectors, management is reviewing alternative
automation sectors such as the food, agricultural, medical, and governmental
markets to help diversify sales and stabilize the cyclical nature of automation
sales to the "high tech" markets. It is believed by management that with the
contraction within the high tech markets, many high tech companies in seeking to
reduce budgetary expenditures, look at capital budget expenditures as one of the
first areas that can be reduced. Many of the automation products the Company
currently designs and manufactures, fall into this category. It is believed that
a diversification into other automation sectors as mentioned above, will help
stabilize the cyclical nature of automation sales within the Company.

      In the interconnect product markets for the IC industry, the Company is
anticipating that with the capabilities of its new production facility, sales
will increase within the first quarter of 2003 due to increased production
capability, better quality, greater control over timeliness of delivery,
enhanced product variety, and more aggressive pricing structures. It is
anticipated that although some additional working capital will be needed to fund
this production facility, that by the second quarter of 2003, the facility will
have begun to return a positive return on investment.

      The Company continues to seek marketing and production opportunities in
China and has established some strategic contacts as it pursues this strategy. A
division within the Company's current structure has been created to oversee this
development. Emory Christensen, formerly the Engineering Manager for the
Company, has been assigned as the general manager for the China development. Mr.
Christensen has established contacts in China and is fluent in Mandarin Chinese.

      Product introduction for both automation and interconnect products is
being pursued in China as well as possible production opportunities for labor
intensive products. In addition, the Company is reviewing possible strategic
partnerships in China that will enable a faster market penetration by utilizing
established partners.

      Management is currently seeking additional funding to increase capital
resources. It is anticipated that some additional funding will be needed for
operating costs in the short term. The Company is continuing to work with
various funding partners as needs arise. Although the Company will aggressively
seek to provide adequate capital funding for ongoing operations, no guarantee
exists that such funding will be obtained.
<PAGE>

                           PART II - OTHER INFORMATION

Item 1. Legal Proceedings: None

Item 2. Changes in Securities:

      Stock Option Plan:

The Company has a stock option plan, which allows employees, directors and
consultants of the Company to receive stock options. The Board of Directors set
aside 2,000,000 shares of common stock for issuance upon exercise of the
options. The Company has awarded 316,920 stock options to employees and
directors during the period ending September 30, 2002. The stock options vest
100% on the first anniversary of the grant notice at a strike price of $0.50 per
share.

      The stock options are exercisable by the optionee as to all or any part of
the stock then vested by delivery to the Company of written notice of exercise
and payment of the purchase price as provided by the plan.

      The Board of Directors maintains the right to change, suspend or terminate
the plan at any time, without notice, and in its sole discretion as provided by
the plan.

Item 3: Defaults Upon Senior Securities: None

Item 4: Submission of Matters to a Vote of Security Holders: None

Item 5: Other Information: None

Item 6: Exhibits and Reports on form 8-K: None
<PAGE>

                            CERTIFICATION PURSUANT TO
                             18 U.S.C. SECTION 1350,
                             AS ADOPTED PURSUANT TO
                  SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

      In connection with the Quarterly Report of R-Tec Holding, Inc., (the
"Company") on Form 10-QSB, and supplemental filing on Form 10-QSB/A for the
period ending June 30, 2002 as filed with the Securities and Exchange Commission
on the date hereof (the "Report"), I, Michael T. Montgomery, Chief Financial
Officer of the Company, certify, pursuant to 18 U.S.C. Code Section 1350, as
adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that:

(1)   The Report fully complies with the requirements of section 13(a) of 15(d)
      of the Securities Act of 1934; and

(2)   To the best of my knowledge, based upon a review of the Report, and,
      except as corrected or supplemented in a subsequent covered Report, the
      Report does not contain any untrue statements of a material fact as of the
      period covered by the Report, nor has any statement of a material fact
      been omitted from said Report; and

(3)   I have reviewed the contents of the Report with the Company's audit
      committee.


      /s/ Michael T. Montgomery
      --------------------------
      Michael T. Montgomery
      Chief Financial Officer
      August 15, 2002
<PAGE>

                            CERTIFICATION PURSUANT TO
                             18 U.S.C. SECTION 1350,
                             AS ADOPTED PURSUANT TO
                  SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

      In connection with the Quarterly Report of R-Tec Holding, Inc., (the
"Company") on Form 10-QSB and supplemental filing on Form 10-QSB/A for the
period ending June 30, 2002 as filed with the Securities and Exchange Commission
on the date hereof (the "Report"), I, Douglas G. Hastings, Chief Executive
Officer of the Company, certify, pursuant to 18 U.S.C. Code Section 1350, as
adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that:

(1)   The Report fully complies with the requirements of section 13(a) of 15(d)
      of the Securities Act of 1934; and

(2)   To the best of my knowledge, based upon a review of the Report, and,
      except as corrected or supplemented in a subsequent covered Report, the
      Report does not contain any untrue statements of a material fact as of the
      period covered by the Report, nor has any statement of a material fact
      been omitted from said Report; and

(3)   I have reviewed the contents of the Report with the Company's audit
      committee.


      /s/ Douglas G. Hastings
      --------------------------
      Douglas G. Hastings
      President and Chief Executive Officer
      August 15, 2002
<PAGE>

                                   SIGNATURES

      In accordance with requirements of the Exchange Act, the registrant caused
this report to be signed on its behalf by the undersigned, thereunto duly
authorized.

                               R-Tec Holding, Inc.
                                  (Registrant)

Date: November 12, 2002


Principal Executive Officer             By /s/ _________________________________
                                               Douglas G. Hastings, President
                                               and CEO


Principal Financial Officer             By /s/ _________________________________
                                               Michael T. Montgomery, CFO


Majority of Board of Directors          By /s/ _________________________________
                                               Rulon L. Tolman, Director


                                        By /s/ _________________________________
                                               Gary A. Clayton, Director


                                        By /s/ _________________________________
                                               Douglas G. Hastings, Director


                                        By /s/ _________________________________
                                               David R. Stewart, Director
<PAGE>


                      R-TEC HOLDING, INC. AND SUBSIDIARIES
                           CONSOLIDATED BALANCE SHEET
           As of September 30, 2002 (Unaudited) and December 31, 2001

<TABLE>
<CAPTION>
                                                                    September 30, 2002   December 31, 2001
                                                                    ------------------   -----------------
<S>                                                                    <C>                  <C>
Current assets
    Cash                                                               $   289,561          $   330,044
    Accounts receivable (net of $23,445 and $26,295
        allowance for doubtful accounts at September 30,
        2002 and December 31, 2001, respectively)                          442,835              150,848
    Costs and estimated earnings in excess
        of billings on uncompleted contracts                                31,481               52,027
    Income taxes receivable                                                 15,295               15,295
    Inventory                                                               54,129                   --
    Prepaid expenses                                                        11,765                3,094
    Notes receivable, current portion                                        4,444                7,635
                                                                       -----------          -----------
                                          Total current assets             849,510              558,943

Equipment and leasehold improvements, at cost,
    net of accumulated depreciation                                        900,701              628,957
Intangible assets, at cost, net of accumulated
    amortization                                                           251,608              320,228
Goodwill                                                                   201,218              201,218
Other assets, at cost, net of accumulated
    amortization                                                            30,076               44,075
Notes receivable, less current portion                                          --                7,475
                                                                       -----------          -----------

                                                  Total assets         $ 2,233,113          $ 1,760,896
                                                                       ===========          ===========

Current liabilities
    Accounts payable                                                   $   200,373          $   204,808
    Accrued expenses                                                        89,814               28,491
    Billings in excess of costs and estimated
        earnings on uncompleted contracts                                      778                   --
    Leases payable, current portion                                         56,705               61,435
    Notes payable, current portion                                         658,922              100,000
                                                                       -----------          -----------
                                     Total current liabilities           1,006,592              394,734

Accrued preferred dividends payable                                        138,945               95,116
Lease payable, less current portion                                         13,645               56,510
Notes payable to related parties, less current portion                     200,000              369,295
                                                                       -----------          -----------
                                             Total liabilities           1,359,182              915,655

Shareholders' equity
    Series A cumulative convertible preferred stock, par value
        $0.23437 per share, 5,000,000 authorized, 2,781,564
        shares issued and outstanding                                      651,100              651,100
    Common stock, no par value per share,
        30,000,000 authorized, 21,052,005 and 19,009,205
        shares issued and outstanding  at September 30, 2002
        and December 31, 2001, respectively                              2,872,915            2,132,755
    Additional paid-in capital                                             440,780              358,540
    Accumulated deficit                                                 (3,090,864)          (2,297,154)
                                                                       -----------          -----------
                    Total shareholders' equity                             873,931              845,241
                                                                       -----------          -----------

                    Total liabilities and shareholders' equity         $ 2,233,113          $ 1,760,896
                                                                       ===========          ===========
</TABLE>

                             See accompanying notes


                                     - 1 -
<PAGE>

                       R-TEC HOLDING, INC. AND SUBSIDIARY
                      CONSOLIDATED STATEMENTS OF OPERATIONS
         For the Period Ended September 30, 2002 and September 30, 2001

<TABLE>
<CAPTION>
                                                          Three Months Ended September 30,    Nine Months Ended September 30,
                                                               2002              2001              2002              2001
                                                          -------------      -------------    -------------      ------------
<S>                                                        <C>               <C>               <C>               <C>
Revenues                                                   $    754,826      $    283,167      $  2,063,748      $  2,129,554

Operating costs                                                 382,810           321,151         1,193,933         1,430,504
                                                           ------------      ------------      ------------      ------------

                                   Gross profit (loss)          372,016           (37,984)          869,815           699,050

Selling, general and administrative expenses                    475,154           525,630         1,523,611         1,143,165
Research and development                                         10,668             2,955            44,696             3,150
                                                           ------------      ------------      ------------      ------------

                                        Operating loss         (113,806)         (566,569)         (698,492)         (447,265)

Interest expense                                                (13,241)           (3,722)          (53,711)          (12,272)
Interest income                                                      --             1,885             2,341             5,847
                                                           ------------      ------------      ------------      ------------
                                                                (13,241)           (1,837)          (51,370)           (6,425)
                                                           ------------      ------------      ------------      ------------

Loss before income taxes                                       (127,047)         (568,406)         (749,862)         (453,690)
Income taxes                                                         --                --                20               652
                                                           ------------      ------------      ------------      ------------

                                              Net loss         (127,047)         (568,406)         (749,882)         (454,342)

Preferred stock dividends                                        14,770            14,610            43,829            43,669
                                                           ------------      ------------      ------------      ------------

             Net loss available to common shareholders     $   (141,817)     $   (583,016)     $   (793,711)     $   (498,011)
                                                           ============      ============      ============      ============

Net loss per common share                                  $      (0.01)     $      (0.03)     $      (0.04)     $      (0.03)
Weighted average shares outstanding                          21,052,005        18,300,012        20,525,895        17,950,635
</TABLE>

                             See accompanying notes


                                     - 2 -
<PAGE>

                      R-TEC HOLDING, INC. AND SUBSIDIARIES
                      CONSOLIDATED STATEMENTS OF CASH FLOWS
   For the Periods Ended September 30, 2002 and September 30, 2001 (Unaudited)

<TABLE>
<CAPTION>
                                                                   Nine Months Ended September,
                                                                       2002             2001
                                                                   -----------      -----------
<S>                                                                <C>              <C>
Cash flows from operating activities
  Net loss                                                         $  (749,882)     $  (454,342)
  Adjustments to reconcile net loss to net
     cash used by operating activities
     Depreciation and amortization                                 $   194,965          129,205
     Common stock issued for services                              $        --               --
     Common stock bonuses                                          $        --               --
     Changes in assets and liabilities
        Accounts receivable                                        $  (291,987)         197,771
        Costs and estimated earnings in excess
          of billings on uncompleted contracts                     $    20,546           38,609
        Inventory                                                  $   (54,129)          (1,400)
        Prepaid expenses                                           $    (8,671)           1,399
        Accounts payable                                           $    (4,435)         (74,281)
        Accrued expenses                                           $    61,323          144,764
        Billings in excess of costs and estimated
          earnings on uncompleted contracts                        $       778          (94,663)
                                                                   -----------      -----------
                         Net cash used by operating activities     $  (831,492)        (112,938)

Cash flows from investing activities
  Purchase of equipment and other assets                           $  (384,089)        (282,596)
                                                                   -----------      -----------
                         Net cash used by investing activities     $  (384,089)        (282,596)

Cash flows from financing activities
  Collections on loans                                             $    10,666            3,369
  Proceeds from common stock and options                           $   822,400        1,116,184
  Proceeds from debt                                               $   658,922               --
  Payments on debt                                                 $  (316,890)        (145,186)
                                                                   -----------      -----------
                     Net cash provided by financing activities     $ 1,175,098          974,367
                                                                   -----------      -----------

                               Net increase (decrease) in cash     $   (40,483)         578,833
Beginning cash                                                     $   330,044           76,634
                                                                   -----------      -----------

                                                   Ending cash     $   289,561      $   655,467
                                                                   ===========      ===========

Supplemental disclosures of cash flow information
  Interest paid                                                    $    37,118      $     9,936
  Noncash investing and financing activities
     Equipment acquired through note payable                       $        --      $   123,639
     Preferred stock dividends payable                             $    43,829      $    43,669
     Acquisition of assets, net of liabilities of $113,806
        with common stock                                          $        --      $   537,426
     Notes payable related party converted to common stock         $        --      $    65,000
     Accrued expenses converted to common stock                    $        --      $   168,166
</TABLE>

                             See accompanying notes


                                     - 3 -
<PAGE>

                      R-TEC HOLDING, INC. AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                          September 30, 2002 and 2001

NOTE A - UNAUDITED INTERIM FINANCIAL STATEMENTS

In the opinion of management, the accompanying unaudited financial statements
contain all adjustments (consisting solely of normal recurring adjustments)
necessary to present fairly the financial position of R-Tec Holdings, Inc. (the
Company) and the results of operations and cash flows. Certain reclassifications
of prior quarter amounts were made to conform with current quarter presentation,
none of which affects previously recorded net loss.

NOTE B - EQUIPMENT AND LEASEHOLD IMPROVEMENTS

Equipment and leasehold improvements consists of:

      Equipment                                               $   643,653
      Vehicles                                                     33,804
      Office equipment and furnishings                             96,082
      Leasehold improvements                                      112,376
      Construction in progress                                    284,127
                                                              -----------
                                                                1,170,042
      Accumulated depreciation and amortization                  (269,341)
                                                              -----------

                                                              $   900,701
                                                              ===========

NOTE C - INTANGIBLE ASSETS

Intangible assets consist of:

      Customer lists                                            $ 365,975
      Accumulated amortization                                   (114,367)
                                                                ---------

                                                                $ 251,608
                                                                =========

The estimated useful life of customer lists is four years.


                                     - 4 -
<PAGE>

                      R-TEC HOLDING, INC. AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                          September 30, 2002 and 2001

NOTE D - OTHER ASSETS

      Other assets consist of:

           Software                                              $ 76,327
           Accumulated amortization                               (46,251)
                                                                 --------

                                                                 $ 30,076
                                                                 ========

The estimated useful life of software is three years.

NOTE E - INVENTORY

Parts inventory is stated at the lower of cost (first-in, first-out method) or
market.

Inventories consist of:

      GCI inventory                                                $26,900
      Parts inventory                                               27,229
                                                                   -------

                                                                   $54,129
                                                                   =======

NOTE F - DEBT

Debt issuances for the quarter ended September 30, 2002 are as follows:

Convertible note payable to Benjamin Coleman,
monthly interest only payments at 12%,
principal due July 2003, convertible to
common stock, unsecured                                                 $ 95,900

Convertible note payable to Janice Baumer,
monthly interest only payments at 12%,
principal due August 2003, convertible to
common stock, unsecured                                                   25,000

Convertible note payable to Gordon Johnson,
monthly interest only payments at 12%,
principal due August 2003, convertible to
common stock, unsecured                                                  100,000

Convertible note payable to James Haney,
monthly interest only payments at 12%,
principal due August 2003, convertible to
common stock, unsecured                                                   30,000

Convertible note payable to Fe Juachon,
monthly interest only payments at 12%,
principal due July 2003, convertible to
common stock, unsecured                                                   50,022
                                                                        --------

                                                                        $300,922
                                                                        ========


                                     - 5 -
<PAGE>

                      R-TEC HOLDING, INC. AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                          September 30, 2002 and 2001

The debt issuances listed above contain a conversion feature that allows the
principal and accrued interest to be converted within thirty days prior to the
maturity date, at the option of the holder, into shares of common stock of the
Company. The conversion price equals 75% of the fair market value of the
Company's common stock, determined as of the date of the conversion notice.

NOTE G - EMPLOYEE STOCK OPTIONS

Effective December 12, 2000, the Board of Directors of Company adopted a stock
option plan which allows for the grant of options for up to 2,000,000 shares of
the Company's Common Stock to officers, directors or key employees of the
Company, consultants of the Company or employees of companies that do business
with the Company. The plan allows for granting incentive stock options to
employees and non-qualified stock options to all other parties. The plan
provides for the options to be granted on incentive stock options at a price
equal to the market price of the stock and at a price of not less than 85% of
the market price of the stock for non-qualified stock options. The plan further
allows for the option period to not exceed five years for the incentive stock
options and not to exceed ten years for the non-qualified stock options. During
2002, a total of 331,920 employee stock options were granted. These options have
exercise prices at $.50.


                                     - 6 -