U.S. SECURITIES AND EXCHANGE COMMISSION
                        WASHINGTON, D.C. 20549

                              FORM 10-K

       [ x ]    ANNUAL REPORT UNDER SECTION 13 OR 15(d) OF THE
          SECURITIES EXCHANGE ACT OF 1934 [No Fee Required]
             For the fiscal year ended December 31, 1999

       [  ]     TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF
        THE SECURITIES EXCHANGE ACT OF 1934 [No Fee Required]

 For the transition period from ________________ to _________________

                  Commission file    333-38567

                 WORLD WIRELESS COMMUNICATIONS, INC.
                 -----------------------------------

                 (Name of registrant in its charter)

                      Nevada                              87-0549700
         -------------------------------               ----------------
         (State or other jurisdiction of               (I.R.S. Employer
          incorporation or organization)             Identification No.)

    5670 Greenwood Plaza Blvd., Suite 340, Englewood, Colorado  80111
    ----------------------------------------------------------  -----
        (Address of principal executive offices)              (Zip Code)

             Registrant's telephone number          (303) 221-1944

Securities registered under Section 12(g) of the Exchange Act:

                                 None
              __________________________________________
                          (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 12 months (or for such shorter period that the
registrant was required to file such reports), and (2)has been
subject to such filing requirements for the past 90 days.
                         Yes [ X ]   No [   ]

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

The aggregate market value of the voting stock held by
non-affiliates of the registrant computed by reference to the price
at which the stock was sold, or the average bid and asked prices of
such stock, as of March 28, 2000 was $104,323,309.

     As of March 28, 2000 there were 29,817,705 shares of
the registrant's common stock issued and outstanding.






<PAGE>


                                PART I

ITEM 1.   DESCRIPTION OF BUSINESS

BUSINESS

Overview
--------

World Wireless Communications, Inc. (the "Company",
"we" or "us") is a leading developer of wireless telemetry and
communications systems and components of spread spectrum digital
radios.  By leveraging our extensive experience in developing
low-cost, reliable communications systems we have developed the
latest generation in web-enabling technology - X-traWeb (TM) .

Our X-traWeb solutions and services allow data from
a remote wireless radio frequency system to be accessed via a
secure, encrypted Internet connection using a standard web browser
located anywhere.  Our technology has applications across a broad
range of industries, for which it can substantially improve the
efficiency and cost of access and manipulation of important data
from widely dispersed equipment.

By integrating system options that use several of
our proprietary wireless technologies, we have capitalized on
approximately two years of development resources to substantially
abbreviate our total time-to-market. Through this period, our
management has been engaged principally in developing product
positioning strategies, strategic planning and final development and
testing of our integrated "total technology solution."

Current Status
--------------

We have completed development and testing of the
core components of our web-enabled supervisory control and data
acquisition ("SCADA")  solution, and are currently launching the
first phase of our near-term plan - introduction of our technology
solution to selected customers in major target markets to establish
beta installation testing for a variety of commercial and industrial
applications and the commencement of product sales.

Industry
--------

Commercialization of the Internet began in the
mid-1980s, with e-mail providing the primary means of communication.
However, it was the Internet's World Wide Web, which provided a
means to link text and pictures, which led to the blossoming of
e-commerce and sparked the explosive growth of the Internet in the
1990s.  Today, millions of people around the world send and receive
information, and purchase products and services through the
Internet. The potential of such a large and still-growing market has
led many business analysts to consider e-commerce as the supreme
opportunity of the times.

According to Forrester Research, a leading market
research firm, Internet-related products and services are estimated
to generate $354.2 billion in revenue in 2001, of which
business-to-business applications will account for $186 billion;
infrastructure (hardware, software and development services) will
account for $58.9 billion; Internet Service Provider ("ISP") fees
and hosting services will garner $48 billion; and content, retail
and financial services will reap the remaining $61.3 billion.


          The enormous growth of the Internet is being driven by:

     .    The increasing familiarity, acceptance, and use of
          the Internet by governments, businesses, and consumers;

     .    The large and growing number of personal computers
          ("PCS") installed in homes and offices;

     .    The decreasing cost of PCS and related peripherals;


                                   4
<PAGE>

     .    The growth and development of web-enabling technologies;

     .    The proliferation of Internet content;

     .    Easier, faster, and less expensive access to the Internet; and

     .    Significant improvements in network infrastructure and bandwidth.


Corporate investment in web-enabling technology is
widely expected to continue to grow both in the U.S. and abroad for
the foreseeable future. A recent report from International Data
Corp. states that domestic spending on web-enabling technologies is
expected to reach $174 billion, representing 57 percent of the
global total, which is expected to amount to $305 billion for 1999.
According to the study, by 2003, companies will spend $1.5 trillion
worldwide.

       The X-traWeb "Total Technology Solution"

               We are a leading developer of wireless
       telemetry and communications systems, technology and
       products.  We also develop components for spread
       spectrum digital radios in the 900 MHZ and 2.4 GHz
       bands, as well as SCADA and automatic meter reading
       ("AMR") systems.  We have extensive experience in
       developing low-cost, reliable communications systems.
       Through key alliances with companies such as
       Panasonic, Motorola Inc. (and previously with Williams
       Wireless, Inc. dba Williams Telemetry Services), we
       have created unique solutions to implement
       communications and telemetry services in applications
       that were previously cost-prohibitive. By leveraging
       this experience, we have developed the latest
       generation in web-enabling technology - X-traWeb(TM) .

               Our X-traWeb solutions and services enable
       commercial and industrial customers to monitor and
       control remote equipment, via the Internet, using a
       standard web browser.  Our technology has applications
       across a broad range of industries, for which it can
       substantially improve the efficiency and cost of
       access and manipulation of important data from widely
       dispersed equipment.

               At the heart of X-traWeb's competitive
       strategy is this "total technology solution" concept.
       While there are several companies designing systems
       that integrate some of the elements of our
       technologies, to management's knowledge, we are alone
       in successfully combining all of the technologies into
       a functional package that not only collects and
       transmits data and provides control from remote
       locations, but also enables customers to use an
       ordinary browser to access the data-gathering and
       remote-control functions from anywhere in the world
       through the Internet.

               Constituting the "first mile" portion of our
       proprietary total technology solution is our rugged
       "X-Node(TM)".  The X-Node is a miniature web server
       compacted into a one square inch embeddable board, or
       available as firmware requiring less than 2 KB of
       memory. This miniature web server collects information
       from a remote piece of equipment (e.g., vending
       machine, gas meter, and the like) and makes that
       information available via the Internet.

               A critical element in implementing our
       technology for large-scale installations is our
       X-traWeb proprietary "X-Gate(TM)".  X-Gate is an
       Internet gateway that can collect information from a
       wired or wireless network of up to 255 X-Nodes (e.g.,
       an array of vending machines), and transmit the
       information to an information repository via the
       Internet. The X-Gate offers distinct advantages over
       the more commonly used gateway - the PC - in that it
       requires no human intervention and incorporates
       advanced technologies to ensure performance and
       reliability.

               Completing the "last mile" portion of our
       total technology solution is our business-to-business
       web site.  This database-driven site collects the
       operations and transactional data which has been
       transmitted from the customers' remote equipment, then
       stores it securely for delivery to authorized customer
       personnel in raw form, or processed and formatted into
       standard or customized reports.

                                   4
<PAGE>

       Competitive Advantages
       ----------------------

               Our technologies offer customers a number of
       advantages, including, without limitation,

               Open architecture solutions that do not use
       proprietary protocols, and components that are fully
       TCP/IP compatible;

       Use of a standard web browser and Internet tools (such
       as Java) to monitor and control remote equipment and
       functions from any Internet-accessible location;

       Wireless technology option that eliminates the need
       for additional (and generally costly) electrical,
       telephone, or other "hardwired" systems at remote
       locations;

       Highly durable components that can operate in a wide
       range of environmental conditions;

       Ease of installing, configuring, bringing online, and
       maintaining or replacing components;

       Firmware-based technology that allows customized
       configuration of equipment already possessing embedded
       microcontrollers; and

       Firmware-based technology that allows automatic
       updating of microcontroller functions from a remote
       location to reflect changes in customer needs and
       specifications.

       Competitive Adaptability
       ------------------------

          Our open architecture solutions do not use proprietary
       protocols. As a result, our X-traWeb components are
       fully TCP/IP compatible and meet current and emerging
       international Internet communications standards,
       providing important benefits when compared to closed,
       proprietary solutions.

          We are at the forefront in developing wireless
       telemetry and communications systems, technology and
       products. The result is that we are consistently
       positioned to provide the most up-to-date technical
       solutions to customers with remote monitoring and
       control needs.

          We are aware of the rapid changes anticipated
       to occur in wireless, SCADA, and web-enabling
       technologies, and intend to migrate our products and
       services to a web-based platform in response to them.
       As part of our migration, we expect to evolve into an
       industry-specialized, customer-only Internet Service
       Provider.

       Strategic Growth Plan
       ---------------------

               We plan to develop and sell our products and
       services in three separate, but at times overlapping
       phases.

       Phase One.  During Phase One, we intend to debut our
       unique combination of wireless, SCADA, and
       web-enabling technologies through providing selected
       Fortune 1000 and other customers with a "total
       technology solution" package of products and services.
       During this phase, we will focus on selling the
       wide-ranging capabilities of our unique technological
       approach by working with our customers to design and
       configure the X-traWeb Networks that address their
       specific industrial and web-based service needs, while
       building a database of standardized technology
       configurations that can be used or easily adapted for
       a variety of applications.  Throughout the process, we
       will seek to establish ourselves as a recognized
       "brand" for innovative, technologically advanced
       products and services.

       Phase Two.  During Phase Two, we intend to leverage
       our brand recognition and the contents of our database
       to expand our market for products and services by
       offering mix-and-match packages for applications in a
       variety of industries. The X-Node and X-Gate
       components will be designed to simply plug in and be
       ready for use or, if necessary, they can be easily
       configured - even by customers. During this phase, we
       plan to develop new applications for our technologies,
       along with a selection of value-added web-based
       services, to strengthen our ties with our established
       customers and extend our reach into new markets.


                                   5
<PAGE>

       Phase Three.  During Phase Three, we expect to evolve
       into an industry-specialized, customer-only Internet
       Service Provider.  We envision such a step as a
       natural and necessary extension of our "total
       technology solution" in order to ensure uninterrupted
       24-hour access to operations-critical remote equipment
       by our customers - something that traditional,
       consumer-oriented ISPs are not geared for, and to
       provide connectivity in those remote areas that are
       not served by traditional ISPs.

       Products and Services
       ---------------------

       Our product strategy is to utilize our existing
       technologies to develop innovative solutions that
       enable users of SCADA technologies to leverage the
       power of the Internet in order to greatly enhance the
       efficiency and cost of controlling and monitoring
       remotely located equipment.

       Our X-traWeb solutions allow standard web browsers,
       rather than customized host system software packages,
       to monitor and control equipment from anywhere in the
       world using industry-standard Internet tools and
       X-traWeb technology. The result is that, from any
       Internet-accessible location, customers in a variety
       of industries have real-time comprehensive,
       cost-efficient information available that helps them
       better manage their SCADA requirements.


       X-traWeb Products
       -----------------

       The X-Node(TM)

       Our web-enabling solutions rely on the use of our
       X-Node technology. The X-Node is a small
       (approximately 1 inch by 1 inch and less than 2 KB of
       memory), fully functional embedded microcontroller and
       wireless Internet gateway. In effect, the X-Node is
       the smallest Web server in the world. X-Nodes are
       extremely durable in most environmental conditions,
       have low manufacturing costs, and can be attached
       easily to a wide variety of existing equipment for the
       purposes of remotely monitoring and controlling the
       equipment over the Internet.

       Each X-Node has two serial ports and incorporates AVR
       Series microcontrollers from Atmel Corporation. These
       microcontrollers allow in-circuit programmability and
       near 1 MIPS instruction execution speed.

       The in-circuit programmability permits the
       installation of X-Node firmware to be done
       automatically during the manufacturing process. The
       firmware then allows automated customization of
       X-Nodes to meet specific customer application
       requirements as part of the manufacturing process,
       eliminating human error. The in-circuit
       programmability also allows us, from a remote
       location, to quickly, easily, and inexpensively update
       the functions of an X-Node to respond to changes in
       customer needs. X-Node capability is also available as
       a firmware license for use in equipment with an
       existing embedded controller installed.

       X-Nodes can be used singly by connecting one to a
       piece of equipment and adding a modem for Internet
       connection.  In situations with multiple devices,
       where more than one X-Node is required, customers can
       use our X-Gate to link the X-Nodes into an X-traWeb
       Network and manage the network. Up to 255 X-Nodes may
       be networked on a wired or wireless basis to a single
       X-Gate.

       The X-Gate(TM)

       Our X-Gate is a small, rugged, proprietary Internet
       Gateway device that replaces the more common gateway:
       the PC. In general, the PC is not a suitable gateway
       for use in X-traWeb solutions because of its cost and
       the need for regular human intervention. The X-Gate
       has been developed using decades of experience in the
       remote control of critical facilities such as
       pipelines and offshore production facilities.

       Each X-Gate has a microcontroller and four serial
       ports, allowing it to communicate with up to 255
       X-Nodes on a single X-traWeb Network and collect and
       send their data through either dial-up or Local Area
       Network ("LAN") connections to the Internet. In the
       event of a power outage or brownout, the unit will
       automatically reboot and continue operation without
       human interference.

                                   6
<PAGE>

       While our current X-Gate model requires the addition
       of a modem or terminal server, the model we are
       developing and plan to market will have these
       incorporated into the X-Gate device, lowering overall
       costs and broadening the range of Internet services we
       can provide our customers.

       X-traWeb Internet Access Servers
       --------------------------------

       The X-traWeb Internet Access Servers, dedicated to
       remote monitoring and control applications, are
       available, thus bypassing normal ISP services whose
       focus is on the more typical Internet traffic.  Our
       Internet Access Servers incorporate over 20 years of
       experience in providing monitoring and control systems
       for critical facilities such as pipelines.  This item
       is not an ISP; it is an industrial strength Internet
       Access Server.

       X-Cam
       ------

       The X-Cam is the first true web camera.  It is based
       on X-Node technology and captures video images
       directly and transmits them to a standard browser
       without use of a personal computer.

       Connectivity
       ------------

       The connection between the X-Nodes and X-Gate can be
       either wireless or wired. Equipment that is
       concentrated in a single location can be hardwired
       directly to the X-Gate. In situations where the
       equipment is impractical to hardwire or spread out
       over a wide area, X-Nodes can be linked together and
       to an X-Gate through our wireless technologies.

       Wireless - Spread Spectrum Technology
       -------------------------------------

       Spread spectrum radio technology has been around since
       the 1940s, limited mostly to military applications.
       Recently, an increased interest in spread spectrum
       modulation and its advantages have emerged,
       particularly concerning low-power, high-density
       personal communication devices. Because they are
       unlicensed, spread spectrum systems usually cost much
       less to install and troubleshoot than narrow band
       systems. In addition, spread spectrum modulation has
       the advantages of low probability of intercept, low
       probability of detection, low probability of
       interference and resistance to jamming.

       There are two methods for employing spread spectrum,
       frequency hopping and direct sequence. In frequency
       hopping systems, the carrier frequency of the
       transmitter abruptly changes (or "hops") in accordance
       with an apparently random pattern. This pattern is in
       fact a pseudo-random code sequence, with the order of
       the frequencies taken from a predetermined set as
       dictated by the code sequence.  The receiver employs
       the same pseudo-random code sequence and, once the
       transmitter and receiver are synchronized, the
       communication is essentially narrow-band on each
       frequency in the sequence.

       In direct sequence systems, the carrier phase of the
       transmitter abruptly changes in accordance with a
       pseudo-random code sequence. This process is generally
       achieved by multiplying the digital information signal
       with a spreading code, also known as a chip sequence.
       The chip sequence has a much faster data rate than the
       information signal and so expands or spreads the
       signal bandwidth beyond the original bandwidth
       occupied by just the information signal. The term
       chips are used to distinguish the shorter coded bits
       from the longer uncoded bits of the information
       signal.   At the receiver, the information signal is
       recovered by remultiplying with a locally generated
       replica of the spreading code. By doing so, the
       receiver effectively compresses the spread signal back
       to its original unspread bandwidth.

       World Wireless Radios
       ---------------------

       Our line of 900 MHZ spread spectrum radios includes
       the 900 SS Hopper, an award-winning frequency hopping
       spread spectrum radio that offers reliable
       communications in a variety of environments.   The
       Hopper features transmission speeds of up to 56 Kbps
       and a range of up to 25 miles, line of sight,
       depending upon conditions and antenna selection.


                                   7
<PAGE>

       In addition, the 900 SS MicroHopper - a miniature
       version of the Hopper - offers a smaller form-factor
       and lower power-consumption for short range
       applications. Measuring just 2 1/2 inches by 1 3/4
       inches, the MicroHopper is ideal for applications
       where size and cost are important considerations.

       Both frequency hopping spread spectrum radios employ
       our proprietary Secure-Sync(TM) technology. This
       coding technology is a major innovation in wireless
       communications, dramatically reducing the overhead
       inherent in other coding methods. It adds security,
       increases throughput efficiency and provides faster
       effective communications speeds at a much lower cost.

       We also offer the 900 SS Direct - a robust direct
       sequence transceiver with RS-232 connectors, capable
       of transmitting data up to 40 kilometers, line of
       sight - and the 2.4G SS MicroHopper - a 2.4 GHz
       frequency hopping radio for international applications
       that transmits data at up to 800 Kbps.

       Customer Support and Services
       -----------------------------

       We support our customers with a range of services
       designed to help integrate our products into our
       customers' systems.  This support includes engineering
       consultation with every developer kit purchase,
       customer satisfaction and quality control programs,
       and in some cases complete turn-key solutions for
       large projects.

       Sales and Marketing
       -------------------

       We believe we are positioned to capitalize on trends
       in many targeted segments of the SCADA market through
       our unique ability to penetrate and establish a market
       presence with products and services designed to meet
       industry-specific needs. Our marketing strategy hinges
       on our establishing a strong reputation as a provider
       of reliable and technologically superior wireless
       Internet-based SCADA services to a diverse customer
       base. To achieve our goals of substantial growth and
       penetration of our target markets, we have developed a
       strategic marketing plan that provides for the
       development and expansion of long-term sales channels
       through which we can sell our X-traWeb solutions well
       into the future.

       Our marketing strategy involves a combination of
       in-house sales and marketing experts, authorized
       agents, strategic marketing alliances, joint-ventures
       and direct sales. These will be enhanced and supported
       by secondary direct marketing, advertising, promotions
       and public relations efforts.

       Direct Sales Organization
       -------------------------

       During the pre-marketing and early launch stages of
       our marketing program, our senior management is
       managing and conducting our marketing activities for
       our X-traWeb solutions.  A target market oriented,
       direct sales management organization has been
       established to manage separate marketing teams which
       have responsibility for specific industry sectors. The
       core team will also manage the activities of outside
       marketing partners, including value-added resellers
       and information technology consultants.

       As marketing activities expand, we plan to enlarge our
       sales and marketing organization to accommodate the
       increased activities, as well as manage and extend our
       marketing programs to our target markets. We plan to
       hire sales managers who are specialists in their
       assigned target markets, and who will be responsible
       for generating the projected sales revenue in their
       respective areas. As we expand our operations, we plan
       to hire additional sales personnel to cover new
       markets and augment the services of sales and
       marketing personnel in certain larger markets.



                                   8
<PAGE>


       Strategic Marketing Alliances
       -----------------------------

       As an integral part of our marketing program, we are
       establishing strategic marketing alliances with
       outside companies that have strong influence within
       the respective target markets for our X-traWeb
       solutions. We will seek to align our self with
       partners that are capable of substantially
       accelerating our penetration of a target market or of
       adding material value to our marketing program through
       the reduction of costs, managerial infrastructure, and
       other economic advantages. We intend to formulate a
       sales plan to target and pursue prospective customers
       through organizations such as: management consulting
       firms, computer networking consultants and value-added
       resellers.

       Our technology offers these co-marketing partners a
       value-added component to the services already being
       provided to their existing customers. These
       co-marketing partners provide us with a credible
       avenue of introduction to other potential customers
       for our products and services.

       Advertising and Promotions
       --------------------------

       An integral part of our long-term marketing plan is
       the generation of awareness within the target markets
       for our products and services. We allocate a portion
       of our gross revenues toward ongoing advertising,
       promotions, and public relations activities, including
       direct mail, trade print media advertising, trade show
       participation and sales personnel incentives. To reach
       an even wider audience as we continue to develop
       widespread awareness of our portal and proprietary
       SCADA solutions, we plan to implement an advertising
       and promotional support program designed to:

               * Establish X-traWeb as a recognized "brand
       name" that is especially familiar to decision-makers
       within our target markets, and synonymous with
       premier-quality technology and products, highly
       effective services and tangible cost efficiencies;

               * Enhance our branding efforts through the use
       of industry experts to promote our product and services;

               *        Position our technological
       capabilities, management, products, services and level
       of support as an industry standard.

               We also plan to implement advertising in trade
       publications on a regular basis.

       We have appointed a public relations firm, which
       extensive expertise in the information technology
       industry, to assist us in the development and
       execution of periodic public relations campaigns,
       including campaigns coordinated with new product
       introductions in existing markets and expanded
       introductions to new markets.  We also will aim to
       highlight our activities through editorial inclusion
       in trade publications and national business
       newspapers.

       We have also allocated promotional funds in our
       advertising budget for our participation in regional,
       national and international trade shows that are
       conducted for industries that comprise our target
       markets, including SCADA and Internet technology
       industry trade shows. We intend to maintain a regular
       presence at key trade shows throughout our
       development, and use its presence to not only attract
       "typical" customers, but also generate follow-on
       marketing opportunities.

       Research and Development
       ------------------------

       We invest significantly in research and development
       activities.  These activities consist of proprietary
       development on our spread spectrum radios and X-traWeb
       solutions.

       We will continue to engage in research and development
       activities for our own products.  Current and future
       projects include new spread spectrum transceivers in
       the 2.4GHz band, improving X-traWeb to enable
       plug-and-play developer kits, improved X-traWeb
       components such as the X-Cam, and similar projects.

       Manufacturing
       -------------

       Until December 31, 1999, we also performed
       manufacturing services for other manufacturers and
       vendors of medical, communications, computer graphics
       and consumer electronic products at our Salt Lake City
       manufacturing facility, and sold antennas from our
       Gonic, New Hampshire facility.


                                   9
<PAGE>


       We discontinued our direct manufacturing operations
       effective as of December 31, 1999, and now conduct our
       manufacturing activities for our own products through
       third parties (except antennas which we manufacture
       directly).

       Contract Design and Development
       -------------------------------

       General
       -------

       At the present time, we are not seeking design and
       development service contracts except in "partnering"
       situations in which we would have an ownership
       interest in the products and/or technology which are
       the subject of the contract and which promote the sale
       of our proprietary products, such as our X-traWeb
       products.  For example, we may have to provide certain
       engineering services for the application of our
       X-traWeb products for use in a specific application or
       applications desired by a vending machine manufacturer
       or a telephone manufacturer or for installation in the
       monitoring of a gas pipeline or the control system in
       a refrigeration storage unit or office management
       system.

       Formerly, we were engaged in providing engineering,
       design and development services to client
       specifications on a fee for services basis. Under one
       significant contract, we developed a low-cost spread
       spectrum technology for use in certain products sold
       by Kyushu Matsushita Electric Co., Ltd. ("KME," which
       is also known as Panasonic) which is more fully
       described below.  We also developed devices for use in
       the automatic meter reading field for Williams
       Wireless, Inc., a wholly owned subsidiary of the
       Williams Companies.  During 1999, we also engaged in
       development work on an asset tracking system for Eagle
       Eye Technologies, a privately-held California based
       corporation, a point-of-sale device for supermarkets
       for Klever Marketing, Inc., a Salt Lake City based
       publicly held corporation and a remote-controlled spa
       for Len Gordon, Inc.

       Kyushu Matsushia Electric Co. Ltd. (Panasonic)
       Contract
       ----------------------------------------------

       In April 1997, we acquired a corporation (by merger in
       1997), which entered into a contract with Kyushu
       Matsushita Electric Co., Ltd. to develop low cost
       spread spectrum radio technology for use in certain
       Panasonic products.  As part of our development
       contract with KME, we granted KME a world-wide,
       non-exclusive license to use or authorize the use of
       any patents, copyrights, technical know-how and other
       intellectual property rights embodied in our LCSSR
       technology in the manufacture of KME products, and
       agreed not to license others to use technology which
       is developed under our contract with KME in connection
       with any telephone-related products for a period of
       two years from the first shipment of KME products
       using the technology. In consideration for these
       rights and our services, KME agreed to pay royalties
       to us on sales of KME products using the technology
       above a prescribed minimum amount of sales for a
       period of two years from the initial shipments of any
       such products. No royalty is paid on sales of the
       first 600,000 units of product using the technology. A
       royalty of $1.00 per unit of product sold is payable
       on sales of units 600,001 through 1,000,000.
       Thereafter, the royalty is $.50 per unit on all units
       sold until the second anniversary of the date of the
       first sale of products using the technology.

       During 1999, we received $540,075 of royalties under
       this contract.  We are unable to predict the amount of
       the royalties, if any, which we may receive under this
       license in 2000, or whether the contract will be
       renewed on the expiration thereof in September, 2000
       or if so, the terms thereof.

       In 1998, we also entered into an agreement with KME to
       develop a key wireless RF transmitter/receiver
       utilized in KME's new 5.7GHz MicroCast(TM).  The
       MicroCast is a convergence appliance that allows home
       personal computers to distribute and control personal
       computer - based interactive media and Internet
       content using a standard TV set.  The MicroCast
       enables consumers to control their personal computer
       remotely using a keyboard, joystick, and/or mouse from
       other rooms in the home.  Two of the three-piece
       system use our designs for the video and audio
       baseband and the 5.7GHz RF technology, the newest and
       highest performance RF technology available to
       consumers today.

       Under our MicroCast contract with KME, we received a
       development fee of $50,000, of which the entire amount
       was paid in 1998, and will receive royalty payments
       for a two-year period commencing on the first
       shipment, which has not yet occurred.  A royalty of
       $1.50 per unit of product sold is payable on each unit
       sold.  We are unable to predict the amount of the
       royalties, if any, we may receive under this
       agreement.


                                   10
<PAGE>

       Competition
       -----------

       We have a number of current competitors in all aspects
       of our business, many of which have substantially
       greater financial, marketing and technological
       resources than us, and which include such industrial
       giants as Panasonic, Motorola, Sony and AT&T. We
       intend to compete in our industry by concentrating on
       certain product or service niches within the overall
       market. However, most of our competitors offer
       products which have one or more features or functions
       similar to those offered by us, and many have the
       resources available to develop products with features
       and functions, competitive with or superior to those
       offered by us.  We cannot assure you that such
       competitors will not develop superior features or
       functions in their products or that the we will be
       able to maintain a lower cost advantage for our
       products.

       A key element of our competitive strategy is to align
       our self with major manufacturers by developing
       proprietary products or technology that can be
       incorporated into its "partner manufacturers"
       products.   We believe that our agreements with KME
       (i.e., Panasonic), and Motorola, illustrate the manner
       in which we can "partner" with much larger,
       established companies to access mass markets for our
       proprietary wireless communications products and
       technology.

       Our management has identified three primary
       competitors offering either SCADA-related products and
       services or web-enabled technologies:

               *        Spyglass, Inc. which develops
       software and firmware, including web-enabling firmware
       for embedded microcontrollers;

               *        emWare, a provider of distributed
       embedded device networking software that provides
       Internet connectivity for any device that scales from
       8-bit microcontrollers to 32-bit microprocessors; and

               *        Connect One, a developer and
       manufacturer of Internet connectivity solutions that
       enable devices to connect to the Internet without
       requiring a PC.

               While each of these companies offers products
       and/or services that have some parallels to those
       provided by X-traWeb, none currently provides the type
       of cost-effective, total solution approach that we do.
        In addition, we are the only company that combines
       all of the technical elements with the additional
       capability for wireless system integration and
       communications.

       Employees
       ---------

       As of December 31, 1999 we had 35 employees.  Of these
       employees, 3 were classified as executive, 7 as
       administrative personnel, 4 engineering, 15
       production, and 6 sales and marketing.   Our employees
       do not belong to a collective bargaining unit, and we
       are not aware of any labor union organizing activity.

       Patents and Intellectual Property
       ---------------------------------

       We believe that reliance upon trade secrets,
       copyrights and unpatented proprietary know-how in
       conjunction with the development of new products is at
       least as important as patent protection in our
       business since most patents provide fairly narrow
       protection, and are of limited value in areas of rapid
       technological change. Further, patents require public
       disclosure of information which may otherwise be
       subject to trade secret protection. We presently own
       two United States patents covering antenna technology,
       and have a United States patent which covers "spread
       spectrum" demodulation technology. "Spread spectrum"
       communication is a method for transmitting and
       receiving coded information which is resistant to
       interference due to the fact that the transmission is
       spread over a large bandwidth. This method requires,
       however, that both the transmitter and the receiver
       have the same spreading code (i.e., a pre-determined,
       fixed pattern) used to spread the information over the
       larger bandwidth. The purpose of the technology
       covered by our spreadsheet patent is to recover and
       remove the spreading code from a transmission signal,
       and thus obtain the original information, in a
       simpler, less expensive manner.

                                   12
<PAGE>

       In addition, during 1998 we filed a United States
       patent application for each of two separate software
       codes.

       Under the terms of a litigation settlement entered
       into with a former co-venturer, we agreed that our
       former co-venturer is entitled to full and equal
       ownership with us, of the spread spectrum demodulation
       technology covered by the patent application,
       including the right to incorporate, develop, utilize
       and exploit the technology. Any uses or products
       developed or derived from such technology, however,
       shall be the sole property of the party which develops
       or derives such uses or products. In addition, if one
       of the parties elects to prosecute the patent
       application prior to final acceptance or rejection by
       the U.S. Patent Office, failure by the other party to
       contribute equally to the costs of prosecuting the
       application will result in the loss of its rights to
       the technology. At this time, we do not have any plans
       to prosecute this patent application, and are unaware
       of any plans by our former co-venturer to prosecute
       the application.

       Furthermore, during 2000, we plan to file at least
       four U.S. patent applications on various operating
       aspects of the X-traWeb system, although we cannot
       assure you that such filings will occur or the results
       thereof.

       We have not filed any patent applications in foreign
       countries.


       History
       -------

       For a description of the history of the Company, its
       subsidiaries, and predecessors, see the prospectus
       dated February 18, 1998, which is incorporated herein
       by reference. The Company formed X-traWeb Inc. as its
       wholly-owned Delaware subsidiary in May 1999.

       ITEM 2.   PROPERTIES
       --------------------

       As of December 31, 1999, the Company's executive
       offices and principal administrative offices and
       manufacturing facilities are located in approximately
       34,000 square feet of space at 2441 South 3850 West,
       West Valley City, Utah which is leased at a monthly
       cost of $27,322 for base rental and allocable common
       area maintenance charges. The Company also pays for
       certain utility expenses. The seven-year lease for
       these premises expires on November 30, 2005.

       In February, 2000 the Company moved its headquarters
       to Englewood, Colorado, where it leases approximately
       7,000 square feet at a monthly cost of $10,228 for
       base rental (and allocable common area maintenance
       charges).

       The Company closed its Salt Lake City facility in
       March 2000, but continues to be liable under the lease
       through November 30, 2005. The Company expects to
       sublease its Salt Lake City office and has retained a
       broker for such purpose, although to date it has not
       been successful in finding a lessee.

       The Company also maintains small leased offices in
       Overland Park, Kansas of approximately 2,850 square
       feet at a monthly rent of $3,444 and in Gonic, New
       Hampshire of approximately 5,000 square feet at a
       monthly rent of $1,700.

       Except for the excess facility in Salt Lake City, the
       Company believes that its facilities are satisfactory
       for its present scale of operations.

       As of February 29, 2000, the Company sold most of its
       manufacturing equipment, and obligations under
       remaining equipment leases are not material.


                                   12
<PAGE>

       ITEM 3.   LEGAL PROCEEDINGS


       The Company received an oral request in 1998 from Mr.
       and Mrs. Richard Austin to rescind the Company's
       purchase of the assets of Austin Antenna Ltd., which
       closed in 1998. In addition, Mr. Austin requested that
       the Company bear the cost of (I) the legal fees and
       expenses in a litigation commenced against Mr. Austin
       in a state court in Massachusetts brought by Charles
       Rich seeking damages for non-payment of commissions
       arising out of the Company's purchase of Austin Antenna
       Ltd. and (ii) an unpaid finder's fee that is the subject
       of the Massachusetts litigation. The Company, in turn,
       has advised Mr. and Mrs. Austin that Austin Antenna Ltd.
       has breached its agreement with the Company. It
       appears Mr. Austin has reached a settlement with
       respect to the Massachusetts action against him.
       Although the Company believes that its claim against
       Austin Antenna Ltd. and the claims of Mr. and Mrs.
       Austin will be amicably resolved, there can be no
       assurance as to the outcome thereof.

       Williams Wireless Inc. raised a claim in 1999 that the
       Company violated the non-competition provisions of
       their agreements by allegedly marketing X-traWeb
       products in the telemetry and meter reading
       applications.   The Company, in turn, claimed that
       Williams Wireless Inc. failed to satisfy all of its
       duties under its various agreements with the Company.
       While the Company believes that Williams' claims is
       properly disputable, the parties agreed orally to
       enter into a settlement agreement and mutual release.
       While Williams Wireless, Inc. paid the sum due under
       the draft settlement agreement to the Company and the
       Company delivered to Williams Wireless Inc. all
       inventory of products for which it made payment to the
       Company, the settlement agreement has not yet been
       signed.   Under the draft agreement the Company had
       agreed also to grant William Wireless, Inc. a
       perpetual non-exclusive royalty-free license to use
       one of the Company's radios as a component in the
       Williams' telemetry systems or products.  In the
       interim, the Company believes that an unrelated party
       acquired the assets or stock of Williams Wireless,
       Inc.  While the Company expects that such settlement
       agreement will be signed by such new owner in the
       foreseeable future, there can be no assurance of such
       result.

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

       The Company held its annual meeting of shareholders in
       February, 1999.  At such meeting, the shareholders by
       the majority vote of those present in person or by
       proxy approved (a) the election of David D. Singer,
       Philip A. Bunker, Brian W. Pettersen and George Denney
       as directors and (b) approved the Company's engagement
       of Hansen, Barnett & Maxwell as the Company's
       independent auditors for calendar year 1999, and (c)
       ratified the 1998 Employee Incentive Stock Option Plan
       and the 1998 Non-Qualified Stock Option Plan.

       ITEM 5.     MARKET FOR REGISTRANT'S COMMON EQUITY AND
                   RELATED STOCKHOLDER MATTERS

       Common Stock
       ------------

       The Company's Common Stock is traded on the National
       Association of Securities Dealers, Inc. Electronic
       Bulletin Board under the Symbol "WWWC".  The high and
       low per share price of the Company's Common Stock and
       the dividends that were paid thereon for 1998 and 1999
       were as follows:

                            1998                    1999
                -------------------------   --------------------------
       Quarter  High        Low  Dividend   High     Low      Dividend
       -------  ----      -----  --------   ----    ----      --------

       1st      12.13     10.50    $0       2.06    1.75         $0
       2nd       7.00      3.56     0       1.88    1.50          0
       3rd       5.25      1.19     0       1.69    1.00          0
       4th       2.13      1.25     0       4.31    1.44          0

       These quotations reflect interdealer prices, without
       retail mark-up, markdown or commissions and may not
       necessarily represent actual transactions.

       At December 31, 1999 the Company had approximately 250
       beneficial owners of its Common Stock.

                                   13
<PAGE>

       Dividend Policy
       ---------------

       The Company has not paid any dividends on its Common
       Stock to date and does not anticipate paying any
       dividends in the foreseeable future.

       Sale of Securities by the Company

       The Company made various sales of shares of its Common
       Stock during the fourth quarter of 1999 as listed
       below which are exempt from registration under the
       Securities Act of 1933, as amended (the "Act"), as set
       forth below:

       1.        In October, 1999 the Company issued 250,000
       shares of its Common Stock to RUSP Holding S.A., at a
       price of $1.00 per share, in cash.  The shares were
       issued in reliance upon Section 4(2) of the Securities
       Act of 1933, as amended (the "Act") and Rule 506 of
       Regulation D promulgated thereunder.  The Company
       believes that RUSP Holding S.A. is an accredited
       investor.

       2.     In October, 1999, the Company issued for cash
       37,500 shares of its Common Stock to Kathryn
       Braithwaite upon the exercise of certain warrants at a
       price of $0.25 per share. The shares of Common Stock
       were issued in reliance upon Section 4(2) of the Act
       and Rule 506 of Regulation D promulgated thereunder.
       The Company believes that Kathryn Braithwaite is an
       accredited investor.

       3.      In October, 1999, the Company issued for cash
       23,077 shares of its Common Stock to Sterling
       Technology Partners upon the exercise of certain
       warrants at a price of $0.25 per share. The shares of
       Common Stock were issued in reliance upon Section 4(2)
       of the Act and Rule 506 of Regulation D promulgated
       thereunder.  The Company believes that Sterling
       Technology Partners is an accredited investor.

       4.       In October, 1999, the Company sold $400,000
       principal amount of its 16% Senior Secured Notes
       maturing on May 14, 2000 to Lancer Offshore Inc. for
       $400,000 in cash.  The Notes were issued in reliance
       upon Section 4(2) of the Act and Rule 506 of
       Regulation D promulgated thereunder.  The Company
       believes that Lancer Offshore Inc. is an accredited
       investor.

       5.    In October, 1999, the Company sold 100 shares of
       its Senior Preferred Stock, and detachable warrants to
       purchase 500,000 shares of its Common Stock at an
       exercise price of $0.25 per share expiring on October
       5, 2004, to Lancer Offshsore Inc. for $100,000 in
       cash.  The shares of Senior Preferred Stock and
       Warrants were issued in reliance upon Section 4(2) of
       the Act and Rule 506 of Regulation D promulgated
       thereunder.  The Company believes that Lancer Offshore
       Inc. is an accredited investor.

       6.       In October, 1999, the Company sold 30 shares
       of its Senior Preferred Stock and
       detachable warrants to purchase 250,000 shares of its
       Common Stock at an exercise price of $0.25 per share
       expiring on October 5, 2004, to Capital Research Ltd.
       for $30,000 in cash.  The shares of Common Stock and
       Warrants were issued in reliance upon Section 4(2) of
       the Act and Rule 506 of Regulation D promulgated
       thereunder.  The Company believes that Capital
       Research Ltd. is an accredited investor.

       7.       In October 1999, the Company sold 250,000
       shares of its common stock to RUSP Holding S.A. for
       $250,000. The shares were issued in reliance upon
       Section 4(2) of the Act and Rule 506 of Regulation D
       promulgated thereunder. The Company believes that RUSP
       Holding S.A. is an accredited investor.

       8.     In November, 1999, the Company sold 500,000
       shares of its Common Stock to RUSP Holding S.A., at a
       price of $1.00 per share, in cash.  The shares were
       issued in reliance upon Section 4(2) of the Act and
       Rule 506 of Regulation D promulgated thereunder.  The
       Company believes that RUSP Holding S.A. is an
       accredited investor.

       9.     In December, 1999, the Company sold 1,000,000
       shares of its Common Stock to RUSP Holding S.A. at a
       price of $1.00 per share, in cash.  The shares were
       issued in reliance upon Section 4(2) of the Act and
       Rule 506 of Regulation D promulgated thereunder.  The
       Company believes that RUSP Holding is an accredited
       investor.

       10.      In December 1999, the Company sold 428,000
       shares of its Common Stock to two investors at a price
       of $1.00 per share, in cash. The shares were issued in
       reliance upon Section 4(2) of the Act and Rule 506 of
       Regulation D promulgated thereunder. The Company
       believes that each of the investors is an accredited
       investor.
                                   14
 <PAGE>

ITEM 6.   SELECTED FINANCIAL AND OTHER DATA

     The following table sets forth unaudited selected financial and other
data of the Company and should be read in conjunction with the more detailed
financial statements included elsewhere in this Report.  See "Management's
Discussion and Analysis of Results of Operations and Financial Condition."

 <TABLE>
 <CAPTION>
                                            For the Years Ended December 31,
                             ----------------------------------------------------------------
                                1999          1998          1997        1996         1995
                             -----------  ------------  -----------  -----------  -----------
<S>                         <C>          <C>           <C>          <C>          <C>
Current Assets               $ 1,960,930  $  1,725,770  $ 1,529,804  $   328,551  $   120,959

Net Equipment                    192,252     1,038,645    1,133,263      327,022      300,840

Other Assets                     425,032     1,372,175    7,469,957        7,469        4,141
                             -----------  ------------  -----------  -----------  -----------
Total Assets                 $ 2,578,214  $  4,136,590  $10,133,024  $   663,042  $   425,940
                             ===========  ============  ===========  ===========  ===========

Current Liabilities          $ 6,087,067  $  5,053,628  $ 1,815,903  $   203,351  $   276,096

Long-Term Liabilities             21,459        84,968       24,275       44,808       44,500

Mandatorily Redeemable
 Preferred Stock                 950,000            -            -            -            -

Stockholders' Equity
 (Deficit)                    (4,480,312)   (1,002,006)   8,292,846      414,883       105,344
                             -----------  ------------  -----------  -----------  ------------
Total Liabilities and
 Stockholders' Equity
 (Deficit)                   $ 2,578,214  $  4,136,590  $10,133,024  $   663,042  $    425,940
                             ===========  ============  ===========  ===========  ============
</TABLE>

 <TABLE>
 <CAPTION>
                                            For the Years Ended December 31,
                             -----------------------------------------------------------------
                                1999          1998          1997        1996         1995
                             ------------  ------------  -----------  -----------  -----------
<S>                         <C>           <C>           <C>          <C>          <C>
  Sales                      $  3,566,307  $  4,309,691  $ 2,913,429  $   618,505  $   426,825
  Cost of Sales                 2,926,459     3,751,607    2,116,934      662,184      237,356
                             ------------  ------------  -----------  -----------  -----------
  Gross Profit (Loss)             639,848       558,084      796,495      (43,679)     189,469
                             ------------  ------------  -----------  -----------  -----------

  Total Operating Expenses      9,434,208    14,131,872    8,571,898    1,882,836      386,612
                             ------------  ------------  -----------  -----------  -----------

  Net Loss From Operations     (8,794,360)  (13,573,788)  (7,775,403)  (1,926,515)    (197,143)

  Other Income (Expense)
    Interest expense           (3,556,097)   (1,813,208)     (43,779)  (1,310,142)      73,593
    Other income                   26,662       343,625        9,692           -            -
                             ------------  ------------  -----------  -----------  -----------
  Net Loss                    (12,323,795)  (15,043,371)  (7,809,490)  (3,236,657)    (270,736)

  Preferred Dividends           1,000,658            -            -            -            -
                             ------------  ------------  -----------  -----------  -----------

  Net Loss Applicable to
   Common Shareholders       $(13,324,453  $(15,043,371) $(7,809,490) $(3,236,657) $  (270,756)
                             ============  ============  ===========  ===========  ===========

 </TABLE>

 <TABLE>

 <S>                        <C>          <C>          <C>          <C>          <C>
  Basic and Diluted Loss
   Per Common Share          $     (0.77) $     (1.34) $     (0.85) $     (1.03) $     (0.26)
                             ===========  ===========  ===========  ===========  ===========
  Weighted Average
   Number of Common
   Shares Used in Per
   Share Calculation          17,308,258   11,189,603    9,217,158    3,141,613    1,049,679
                             ===========  ===========  ===========  ===========  ===========
</TABLE>

 ITEM 7.    MANAGEMENT'S DISCUSSION AND ANALYSIS OF RESULTS OF OPERATIONS
            AND FINANCIAL CONDITION

               When used in this discussion, the words "expect(s)",
"feel(s)", "believe(s)", "will", "may", "anticipate(s)" and similar
expressions are intended to identify forward-looking statements. Such
statements are subject to certain risks and uncertainties, which could cause
actual results to differ materially from those projected. Readers are
cautioned not to place undue reliance on these forward-looking statements,
and are urged to carefully review and consider the various disclosures
elsewhere in this Report which discuss factors which affect the Company's
business, including the discussion under the caption "Risk of Default with
Debtholders".

               The following discussion should be read in conjunction with
the Company's Consolidated Financial Statements and respective notes
thereto, Selected Consolidated Pro Forma and Historical Financial Data,
Unaudited Condensed Pro Forma Consolidated Statements of Operations and
respective notes thereto, which are set forth elsewhere in this Report.

RESULTS OF OPERATIONS

1999 Compared to 1998

               Sales in the twelve-month period ending December 31,1999 were
$3,566,307 compared to $4,309,691 during the twelve-month period ending
December 31, 1998. During 1999 the Company derived its revenue as follows:
engineering services, $867,451; royalties $540,075 branded products,
$789,167; and contract and cable manufacturing, $1,369,614.  The Company's
principal source of revenue for the twelve-months ended December 31, 1998
was a design and development contract with Williams Telemetry, a Williams
company, in the amount of $2,664,000. Other significant revenues include
contract manufacturing of $531,000 and sales of the Company's own branded
goods of $586,000.

               Gross profit in the twelve months period ending December 31,
1999 was $639,848 compared to $558,084 during the comparable period during
1998, which represents 18% and 13% of sales respectively.

               The Company reduced its research and development costs by
$1,860,594 from $3,179,557 in the twelve month period ending December 31,
1998 to $1,318,963 in the twelve month period ending December 31, 1999,
primarily by reducing the number of its employees and related expenses.

               During the 4th quarter of 1999, the Company executed a plan
to focus its efforts on the X-traWeb (TM) product line and abandon its
contract and in-house manufacturing activities. As a result of this
decision, the Company recognized $2,615,489 in manufacturing activity exit
costs. These costs consist of the impairment of all assets used in the
manufacturing process and the remaining rent obligation of the abandoned
Salt Lake facility. In addition, the related patents and goodwill associated
with the manufacturing activities of the company were impaired. Although the
Company is actively seeking a lessee for such facility and has retained a
broker, it has not found a tenant at present.

               The amortization of goodwill including the impairment of
goodwill decreased $5,776,611 from $134,932 for the twelve month period
ending December 31, 1998 to $842,076 for the twelve months ending December
31, 1998. The decrease was due to the $4,722,425 impairment of goodwill the
Company recognized in the third quarter of 1998.

               The increased interest expense was due primarily to the
issuance of the warrants and common stock in connection with the obtaining
of the waivers of defaults on the notes payable.

               Interest income resulted from the Company's investing
available cash in overnight interest bearing accounts.

               During the twelve months ending December 31,1999, the Company
issued 950 shares of senior liquidating mandatorily redeemable 10% preferred
stock with a liquidation preference of $1,000 per share and detachable
five-year warrants to purchase 4,750,000 common shares at $0.25. The
issuance of preferred stock with warrants has been accounted for as the
granting of a favorable conversion feature to the preferred stockholders.
The value assigned to the warrants was based on the their intrinsic value
but limited to the cash proceeds and the amount of the notes converted.
Since the warrants were immediately exercisable, the resulting discount to
the preferred stock of $950,000 was immediately recognized as a preferred
dividend. Additionally, dividends in the amount of $50,658 were accrued as of
December 31, 1999.

Fiscal Year 1998 Compared to Fiscal Year 1997

               Sales in the twelve-month period ended December 31, 1998 were
$4,309,691 compared to sales of $2,913,429 during the twelve-month period
ended December 31, 1997. The Company's principal source of revenue for the
twelve-months ended December 31, 1998 was a design and development contract
with Williams Telemetry, a Williams company, in the amount of $2,664,000.
Other significant revenues include contract manufacturing of $531,000 and
sales of the Company's own branded goods of $586,000. Significant revenues
for 1997 were derived from an engineering contract with Kyushu Matsushita
Electric Co. ("KME") in the amount of $1,596,000. Sales relating to the
SecuriKey business were insignificant during 1997 and the line was sold to a
prior employee/shareholder with no revenues were recorded in 1998.

               Cost of sales for the twelve-months ended December 31, 1998
were $3,751,607 compared to cost of sales for the twelve-month period ended
December 31, 1997 of $2,116,934. Cost of sales as a percentage of sales
decreased from 73% to 87% in the twelve-months ended December 31, 1998. The
related gross profit for the twelve-months ended December 31, 1998 was
$558,084 or 13% of sales compared to $796,495 or 27% of sales for the
twelve-month period ended December 31, 1997.

               The Company incurred research and development costs of
$3,179,557 during the twelve-months ending December 31, 1998, relating to
the development of proprietary technology.  Included in the $3,179,557 is
$305,651 of purchased research and development expense arising out of the
acquisition of radio technology in May 1998. The amount spent on research
and development for the twelve-month period ended December 31, 1998 was
greater than the amount spent for the twelve-month period ended December 31,
1997 of $2,943,404 of which $1,258,000 was for purchased research and
development expense arising out of the acquisition of Digital Radio in
February 1997.

               The Company's selling, general and administrative expenses
for the twelve-months ended December 31, 1998 increased to $4,975,307 from
$4,243,779 for the twelve-month period ended December 31, 1997. Included in
the $4,975,307 is $1,024,000 of non-cash compensation relating to the grant
of stock options in December 1997. Such increase also reflected a
substantial increase in the average number of employees of the Company to
approximately 90 in the current year as compared to an average of
approximately 50 employees in the prior year. During the three months ended
December 31, 1998, the Company reduced its employees by approximately 30%.
However,  the Company had increased the number of its higher paid employees
as a result of acquisitions in 1997. The Company also increased staffing in
anticipation of the launch of the Company's proprietary radio products. The
increase in costs was also attributable to its maintenance of duplicate
administrative facilities and related administrative expenses by virtue of
its two business locations in Utah.  Management  eliminated duplicate
administrative efforts by consolidating into one facility during October
1998.

               Interest expense for the twelve-months ended December 31,
1998  increased to $1,813,208 from $43,779 for the twelve-month period ended
December 31, 1997, which increase was attributable to the greater amount of
the Company's outstanding borrowings during the current year of which
$874,000 resulted from the amortization of debt discount.

               The Company's net loss of $15,043,371 for the twelve-months
ended December 31, 1998, represents an increase from the net loss of
$7,809,490 for the twelve-months ended December 31, 1997, as a result of the
above items.

               During April 1998, the Board of Directors approved the
repurchase of unvested employee stock options at a price of $0.01 per share.
These options were granted during the fourth quarter of 1997. The repurchase
enables the Company to discontinue charging the difference between fair
market value in the stock at the time of option grant and the option
exercise price to operations.

Impairment of Goodwill

               The Company's management evaluated the recoverability of the
goodwill recognized from the acquisition of Digital Radio Communications
Corporation ("Digital Radio"). The Williams contracts, including Commercial
Service Agreements, (i.e. purchase orders from Williams) and a Technical
Development and Marketing Agreement (the "TDMA") were finalized during
December 1997 and were the primary feature of interest to the Company in
acquiring Digital Radio in February 1997. This fact is evidenced by Digital
Radio representing in the Acquisition Agreement that it was completing a
contract with Williams and by the existence of a significant condition to
that agreement that the Williams contract be signed prior to the closing of
the Digital Radio acquisition. That condition was satisfied by Williams and
the Company entering into their first TDMA by July 1997. The TDMA was a
framework for future Commercial Service Agreements and an agreement whereby
Williams agreed to purchase radios from the Company. The TDMA was
subsequently amended in September 1997 and again in November 1997; however,
management of World Wireless considered the original TDMA to be sufficient
to meet the condition that the Williams contracts had been signed, and
proceeded to close the acquisition. The Williams contract was considered by
the Company to exist at the date of the acquisition of Digital Radio and was
the principal intangible item of interest to the Company in acquiring
Digital Radio. The Williams contracts were also the primary factor in
establishing the number of shares issued in the acquisition of Digital
Radio. Accordingly, when anticipated revenue from radio sales never
materialized, the goodwill became impaired.

               The Digital Radio goodwill was not considered impaired prior
to receipt of the TDMA nor the Commercial Service Agreements in 1997, nor
was it considered impaired until the third quarter of 1998 when it became
apparent to management that the engineering team at Digital Radio was unable
to complete the working radio technology promised under the Williams
contracts. In addition, Williams decided to redesign the Company's product
and there was a delay in submitting the system to the FCC for clearance. As
a result, Williams was unwilling to enter into significant Commercial
Service Agreements for the purchase of radios from the Company. It was
therefore clear in the third quarter of 1998 that future cash flows to be
generated through the efforts of the engineering staff at Digital Radio, and
from the Digital Radio technology would not be sufficient to recover the
carrying amount of the unamortized assets acquired - primarily goodwill. The
engineering team at Digital Radio was disbanded through termination of the
employment of all Digital Radio engineers by August 1998. Therefore, the
carrying value of the Digital Radio goodwill, which primarily related to the
engineering team and the Digital Radio technology, was written down by
$4,722,425 during the third quarter 1998, to management's estimate of the
discounted expected net future cash flows of $600,000.

               The Company evaluated the recoverability of the goodwill
recognized in connection with the TWC Ltd. acquisition during the fourth
quarter of 1999, and determined that circumstances indicate an inability to
recover their carrying amount. Accordingly, an impairment loss of $641,679
was recognized during 1999 to adjust the carrying amount of the goodwill to
its estimated expected discounted net future cash flows. The goodwill was
reduced to zero.

Liquidity and Capital Resources

               The Company's liquidity at December 31, 1999 consisting of
cash and cash equivalents was $893,849, which represented an increase of
$278,952 over the Company's cash and cash equivalents of $614,897 as of
December 31, 1998. The Company's current assets were $1,960,930 as of
December 31, 1999, an increase of $235,160 from the Company's current assets
of $1,725,770 as of December 31, 1998

               In order to pay off the Company's Senior Secured Notes, which
had a maturity date of May 15, 1999 (the "1998 Notes"), the Company raised
financing in May 1999. Such financing involved the sale of separate units
consisting of $2,600,000 principal amount of the Company's Senior Secured
Notes, bearing interest at 16% per annum, payable quarterly and maturing on
May 14, 1999 (the "1999 Notes"). The 1999 Notes were secured by a first
security interest in substantially all of the Company's assets, including
its machinery, equipment, automobiles, fixtures, furniture's, accounts
receivable and general intangibles, including any stock in any subsidiary.

               Also, during May, August and October 1999,  the Company had
sold separate units consisting of 950 shares of the Company's 10% Mandatorily
Redeemable Preferred Stock and detachable warrants to purchase 4,750,000
shares of the Company's Common Stock at an exercise price of $0.25 per share,
exercisable in whole or in part by the holder at any time on or before May
14, 2004 in the case of 3,250,000 shares, August 27, 2004 in the case of
850,000 shares, and October 5, 2004 in the case of 650,000 shares. Such
sales by the Company occurred in a private placement transaction exempt
from registration made by the Act.

               As a result of such new financing, the Company paid off the
principal amount of the Notes of $2,395,528 outstanding and accrued interest
of $96,355 in full on or immediately after the maturity date of the 1998
Notes. Accordingly, the Company believes that it satisfied all of its
remaining obligations under the 1998 Notes in full and it does not
anticipate any further claim with respect thereto.

               In August, 1999 the Company obtained separate waivers of the
potential defaults for the quarter ended June 30, 1999 from the holders of
the 1999 Notes. In addition, the Company obtained a deferral of any payment
of principal on the 1999 Notes until December 31, 1999 regardless of any
financing raised by the Company prior to such date through the sale of its
securities, and made certain other changes in the loan agreements. As a
condition thereto the Company (a) granted the holders of the 1999 Notes
additional warrants to purchase 300,000 shares of the Company's common stock
at an exercise price of $0.25 per share, exercisable in whole or in part at
any time for a period of five years, (b) issued the holders of the 1999
Notes 200,000 shares of the Company's common stock, which shares would be
subject to applicable securities law restrictions, and (c) in the case of
the potential default in the payment of interest for certain of the holders
of the 1999 Notes, issued 50,000 shares of its Common Stock, subject to
applicable securities laws restrictions.

               The Company would have been in default under a
Pledge/Security Agreement associated with the 1999 Notes on the date of
filing of its Form 10-Q for the quarter ended September 30, 1999 because the
Company had an operating loss in excess of that projected for such quarter,
which failure would have constituted an event of default under the Loan
Agreement between the Company and the holders of the 1999 Notes. Upon the
occurrence of such an event of default, the holders of the 1999 Notes had as
their exclusive remedy the right to additional warrants to purchase 300,000
share of the Company's common stock at an exercise price of $0.25 per share,
exercisable in whole or in part at any time for a period of five years.

               During the first quarter of 2000, the Company raised
approximately $13,736,000 in private placement transactions exempt from
registration made by the Act.  Also, warrants of $947,204 were exercised for
the conversion of notes payable. In addition, the Company redeemed the
preferred stock of $950,000 plus accrued dividend of $57,378. The Company
also paid the remaining balance of the 1999 Notes of $3,324,827 with cash
payments of 2,377,623 and the exercise of warrants of $947,204 as discussed
previously, and accrued interest of $35,059 thereby discharging such debt in
full.

Risk of Default with Debtholders

               In order to pay off the Company's Senior Secured Notes which
had a maturity date of May 15, 1998 and to provide financing for its
operations, the Company raised financing in May, August and October, 1999.
Such financing involved the sale of separate units consisting of $3,480,000
principal amount of the Company's Senior Secured Notes, bearing interest at
16% per annum, payable quarterly and maturing on May 14, 1999 (the "1999
Notes").  The 1999 Notes were secured by a first security interest in
substantially all the assets of the Company's assets, including its
machinery, equipment, automobiles, fixtures, furniture, accounts receivable
and general intangibles, including any stock in any subsidiary.

               Also, in May, August and October, 1999, the Company sold
separate units consisting of 950 shares of the Company's 10% Senior
Preferred Stock and detachable warrants to purchase 4,750,000 shares of
the Company's Common Stock at an exercise price of $0.25 per share,
exercisable in whole or in art by the holder at any time on or before
May 14, 2004 (and August and October, 2004 in the case of some of the
warrants).  Such sales by the Company occurred in a private placement
transaction exempt from registration made by the Securities Act of 1933,
as amended.

               The Company would have been in default under the
Pledge/Security Agreement associated with the 1999 Notes on the date of
filing of its Form 10-K for the year ended December 31, 1999 because the
Company had a loss in excess of the income projected for such quarter, which
failure would have constituted an event of default under the Loan Agreement
between the Company and the holders of the 1999 Notes.  Upon the occurrence
of such an event of default, the holders of the 1999 Notes had as their
exclusive remedy the right to additional warrants to purchase 300,000 shares
of the Company's common stock at an exercise price of $0.25 per share,
exercisable in whole or in part at any time for a period of five years,
which the Company transferred to them.  Moreover, the Company obtained a
deferral until February 15, 2000 of the payment of $744,828 of a principal
payment required to be made on December 31, 1999 from five holders of the
1999 Notes (representing the amounts due them), which the Company paid when
due, together with interest due on the 1999 Notes as of such date.

              In early March, 2000, the Company satisfied $947,204  of the
principal amount of the 1999 Notes by applying the deemed exercise price
of warrants held by the holders of the 1999 Notes deemed received upon the
exercise of such warrants.  In addition, the Company paid the remaining
balance of the 1999 Notes of approximately $1,632,797, and interest
thereon, in March, 2000, thereby discharging the 1999 Notes in full.

             Accordingly, the Company believes that it satisfied all of its
remaining obligations under the 1999 Notes in full as of the date hereof.

Outlook

               The statements contained in this Outlook are based on current
expectations. These statements are forward looking and actual results may
differ materially.

X-traWeb(TM) Products

               During 1999, the Company received no revenues from, and had
no sales of any of, its X-traWeb products.  As of December 31, 1999, the
Company had submitted proposals to an Italian telephone manufacturer, an
Italian electrical utility, a California utility and others.  In addition,
the Company received a purchase order for the initial installation of an
X-traWeb(TM) network for a vending machine owner and operator in
Pennsylvania and for a test site at a national fast food chain site in
Columbus, Ohio.  While the Company believes that its pending proposals will
be accepted in whole or in part from these sources and others, that it will
develop additional sources of sales in the United States, Italy and other
foreign countries and will derive substantial revenues therefrom in 2000 and
thereafter, there cannot be any assurance that any such sales will be made
or the amount thereof, although management anticipates that X-traWeb(TM)
product sales will constitute the bulk of its revenues during the year 2000
and thereafter.

Proprietary Radio Products

               The Company only sold a limit quantity of these radio
products to date.  The Company believes that it will derive significant
revenues from the sale of its proprietary radio products in the future.
However, there can be no assurance as to the amount of such sales or when
such sales will occur.

Contract Manufacture and Assembly, Antennas, and Royalties

               The Company discontinued its manufacturing activities during
the first quarter of 2000 and will outsource manufacture the Company's
X-traWeb and radio products thereafter.

               The Company does not expect antenna products to contribute
materially to its consolidated net sales or income in the foreseeable
future.

               The Company believes that it will receive additional royalty
income under its Panasonic contract with respect to shipments for the first
three quarters of 2000.  However, the Company cannot predict the amount of
such royalties to be received from the future sale of such Panasonic
products, or whether such contract will be renewed after September, 2000,
or, if so, on what terms.

Summary

               Management believes that the potential growth of the
Company's X-traWeb(TM) business segment and proprietary radio products
require additional financing to sustain the Company's proposed operations in
these areas.  It is anticipated that additional executive and marketing
personnel will be required for the X-traWeb(TM) business in advance of the
receipt of any substantial revenues from such source.  There can be no
assurance that the Company will be able to locate and hire qualified
personnel for such functions; moreover, such a task is time-consuming.
Thus, the Company is currently engaged in seeking to raise additional
financing in private placement transactions in the United States and Italy
in implementation of its fund-raising program. The Company raised
approximately $13,736,000 from the sale of shares of its common stock in the
first quarter of 2000, and is using a broker-dealer to raise an additional
$7,500,000 within the second quarter. While the Company believes that such
additional financing can be obtained, there can be no assurance that such
financing will be achieved, or, if made available, on terms acceptable to
the Company.

               In summary, while management is optimistic about the
Company's future, it is fully aware that anticipated revenue increases from
sales of X-traWeb(TM) products and its proprietary radios and royalty income
are by no means assured, and that its requirements for capital are
substantial, for which the availability is by no means assured.

Statement Regarding Forward-Looking Disclosure

               This report includes "forward-looking statements" within the
meaning of Section 27A of the Securities Act and Section 21E of the Exchange
Act which represent the Company's expectations or beliefs concerning future
events that involve risks and uncertainties, including those associated with
the ability of the Company to obtain financing for its current and future
operations, to manufacture (or arrange for the manufacturing of) its
products, to market and sell its products, and the ability of the Company to
establish and maintain its sales of XtraNet products.  All statements other
than statements of historical facts included in this Report including,
without limitation, the statements under "Management's Discussion and
Analysis of Results of Operations and Financial Condition" and "Business"
and elsewhere herein, are forward-looking statements. Although the Company
believes that the expectations reflected in such forward-looking statements
are reasonable, it can give no assurance that such expectations will prove
to have been correct.  Important factors that could cause actual results to
differ materially from the Company's expectations ("Cautionary Statements")
are disclosed in this Report, including without limitation, in connection
with the forward-looking statements included in this report. All subsequent
written and oral forward-looking statements attributable to the Company or
persons acting on its behalf are expressly qualified in their entirety by
the Cautionary Statements.

Year 2000

               The Company did not suffer any material adverse impace
resulting from the "Year 2000" issue.  The Year 2000 problem is the result
of computer programs being written using two digits rather than four to
define the applicable year.  The Company incurred approximately $25,000 in
modifying its existing software and converting to new software in addressing
such issue.

ITEM 8.        FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

               See Index to Financial Statements, Page F-1

ITEM 9.  CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNT AND
         FINANCIAL DISCLOSURE

               None.



                                  PART III.

ITEM 10.   DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT

                    The executive officers and directors of the Company at
December 31, 1999 were as follows:

    Name               Age         Position

  David D. Singer      50          Chairman of the Board of Directors,
                                   President, Chief Executive Officer and
                                   a Director

 Donald I. Wallace     55          Executive Vice President--Telemetry and
                                   SCADA Division,
                                   President of X-traWeb, Inc. and a Director

 George Denney         61          Director(1)

 Charles Taylor        45          Vice President - Sale/Marketing

 Malcolm P. Thomas     40          Director

 Kevin Childress       40          Vice President - Finance(2)
____________________

     1   Mr. Denney resigned as a director in January, 2000.

     2   Mr. Childress resigned as an employee and officer in March, 2000.
-------------------

                 David D. Singer - Mr. Singer was appointed President of the
Company in November 1996, and became a Director in February 1997. From 1977
to 1983, Mr. Singer was President of CSL Energy Controls, Inc., a company
specializing in third party energy conservation. From 1983 to 1985, Mr.
Singer was a special consultant to the General President of the Sheetmetal
Workers Association. From 1985 to 1988, Mr. Singer was Vice President First
Municipal Division, Bank One Leasing Corporation. From 1989 to 1994, Mr.
Singer was President of Highland Energy Group. From 1991 to 1996, Mr. Singer
was employed by Navtech Industries, Inc., an electronic assembly company, as
Vice President Sales and Marketing from February 1994 to July 1995, and as
President and Chief Operating Officer from July 1995 to July 1996.

                 Donald I. Wallace - Mr. Wallace was appointed Executive
Vice President -- Telemetry and SCADA (i.e., Systems Control and Data
Access) Division of the Company in January 1998, became the President of
X-traWeb, Inc., the Company's wholly-owned subsidiary, and was elected a
Director in April, 1999.  Prior to his employment by the Company, Mr.
Wallace was employed, from December 1995, as President of PrimeLink, Inc., a
Lenexa, Kansas company which Mr. Wallace founded to engage in the
development and marketing of wireless telemetry products for remote meter
reading. Between September 1991 and November 1995, Mr. Wallace was employed
as the President of Arcom Control Services, Inc., which developed and
marketed computer-based monitoring and control products for the oil and gas
industry.

                 George Denney - Mr. Denney was elected a director of the
Company in February 1998. Mr. Denny founded Cole-Haan in 1975, and has
served as Chairman of Cole-Haan since its inception. Cole-Haan was acquired
by NIKE, Inc. in 1988. Headquartered in Yarmouth, Maine, Cole-Haan designs
and sells fine dress and casual footwear and accessories.

                 Charles Taylor -  Mr. Taylor was elected one of the
Company's Directors in July, 1999 and was elected as a member of the
Company's Audit, Compensation and Stock Option Committees on November 11,
1999.  During the period from 1995 to the present, Mr. Taylor has been a
senior investment advisor with Amerindo Investment Advisors based in New
York City and is a senior member of a team that  manages approximately $4
billion in growth portfolios, including the Amerindo Technology Fund.  Prior
to such period, Mr. Taylor served as technology analyst with several major
investment banking firms.

                 Malcolm P. Thomas - Mr. Thomas was elected one of the
Company's Directors effective September 2, 1999 and was elected as a member
of the Company's Audit Committee on November 11, 1999 and of the Company's
Compensation and Stock Option Committees on January 20, 2000.   During the
period from 1991 to the present, Mr. Thomas has been the Director of
Operations and Marketing at Fluor Global Services, Inc., a wholly-owned
subsidiary of Fluor Corporation (a New York Stock Exchange company), having
been promoted from Manager of Marketing Services and operation in the
Western United States for his corporation.

                 Kevin Childress - Mr. Childress joined the Company as its
Controller in November, 1998 and became Vice President - Finance in
December, 1998.  Prior to joining the Company, Mr. Childress served as
Director of Finance of American Procurement and Logistics for a subsidiary
of American Stores.

ITEM 11.  EXECUTIVE COMPENSATION

                 The table below sets forth information concerning
compensation paid in 1997, 1998 and 1999 to David D. Singer, the Company's
Chairman, President and Chief Executive Officer, and Donald I. Wallace, the
Company's Executive Vice President Telemetry and SCADA and th President of
X-traWeb, Inc.   Except as set forth in the table, no executive officer of
the Company received compensation of $100,000 or more in 1999.

 <TABLE>
<CAPTION>
                                                  Summary Compensation Table
                                      Annual Compensation                 Long-Term Compensation
                                 -------------------------------  ---------------------------------------
                                                                             Awards             Payouts
                                                                  --------------------------  -----------
                                                       Other      Restricted                                  All
Name and                                               Annual        Stock        Options     LTIP           Other
Principal Position        Year   Salary     Bonus   Compensation   Awards ($)      /SARs(#)   Payouts($)  Compensation
------------------      ------  --------  -------- ------------   -----------   -----------  ----------  ------------
<S>                    <C>     <C>       <C>      <C>            <C>           <C>          <C>         <C>

 David D. Singer(1)(2)   1999   $151,653      -          -             -           400,000         -            -
 President               1998    143,530      -          -             -              -            -            -
                         1997    120,000      -          -             -              -            -            -

Donald Wallace(1)(2)     1999    127,993      -          -             -           220,000         -            -
President, X-traWeb,     1998    124,809      -          -             -              -            -            -
Inc.

</TABLE>
          ______________

          (1)       Neither Mr. Singer nor Mr. Wallace received
          compensation reportable as "Other Annual Compensation"
          which exceeded 10% of his salary in 1999.

          (2)       Mr. Singer is the Chairman and Mr. Wallace is
          the President of X-traWeb, Inc., our wholly-owned
          Delaware subsidiary formed in 1999.

                    The following table sets forth certain
          information regarding options owned by Messrs. Singer
          and Wallace at December 31, 1999:


<TABLE>
             Aggregated Option\SAR Exercises in Last Fiscal Year and
                            Options\SAR Values
<CAPTION>
                                                     Number of Securities Underlying
                                                      Unexercised Options\SARs at      Value of Unexercised In-
                                                       Fiscal Year-End               The-Money Options/SARs
                  Shares Acquired                              (#)                        At Fiscal Year End (S)
Name              on Exercise (#)   Value Realized($)  Unexercisable   Exercisable    Unexercisable  Exercisable
---------------   ---------------   -----------------  ------------   -------------   -----------  -------------
<S>               <C>               <C>                <C>            <C>            <C>          <C>
 David D. Singer         -                  -            400,000(2)      50,000(1)    $  740,000          -
 Donald Wallace          -                  -            220,000(3)         -         $  441,000          -

</TABLE>




                    For the purpose of computing the value of
          "in-the-money" options at December 31, 1999 in the
          above table, the fair market value of a share of the
          Company's Common Stock at December 31, 1999 is deemed
          to be $3.94 per share, which was the average of the
          last reported trade of such shares on the NASDAQ OTC
          Electronic Bulletin Board on such date.

          __________________________


          (1)       The stock options are exercisable as follows:
          all were fully vested as of December 31, 1998.

          (2)       The stock options are exercisable as
          follows: 80,000 shares on January 1, 2000,
          80,000 shares on November 11, 2000, 80,000
          shares on November 11, 2001, 80,000 shares on
          November 11, 2002, and 80,000 shares on
          November 11, 2003.

          (3)  The stock options are exercisable as
          follows: 24,000 shares on January 1, 2000,
          24,000 shares on November 11, 2000, 24,000
          shares on November 11, 2001, 24,000 shares on
          November 11, 2002, and 24,000 shares on
          November 11, 2003.  In addition, another stock
          option is exercisable as follows: 33,333 shares
          on April 22, 2000; 33,333 on April 22, 2001;
          and 33,334 shares on April 22, 2002.


          ITEM 12.  SECURITY OWNERSHIP OF CERTAIN BENEFICIAL
                    OWNERS AND MANAGEMENT

               (a)  Set forth below is information as of
          December 31, 1999 pertaining to ownership of the
          Company's Common Stock, determined in accordance
          with Rule 13(d)(3) under the Securities and
          Exchange Act of 1934, by persons known to the
          Company who own more than 5% of the Company's
          Common Stock:

    Name and Address of
    Beneficial Owner                Number of Shares(1)     Percent of Class(2)
    -------------------             -------------------     -------------------
      Michael Lauer                  7,296,339(3)              24.6%
      200 Park Avenue
      Suite 3900
      New York, NY 10166

      Lancer Offshore Inc.           4,642,548(4)              15.9%
      200 Park Avenue
      Suite 3900
      New York, NY 10166

      Lancer Partners LLC              500,000(4)               1.8%
      200 Park Avenue
      Suite 3900
      New York, NY 10166

      Lancer Partners, LP            1,805,650(4)               6.6%
      200 Park Avenue
      Suite 3900
      New York, NY 10166

      Lancer Voyager                   238,600(4)                *
      375 Park Avenue
      New York, NY10022


      Orbiter Fund Ltd.                109,600(4)                *
      375 Park Avenue
      New York, NY

      RUSP Holding S.A.              2,500,000                  9.3
      Luxembourg

      Pensionskassee Der Siemens     2,000,000                  7.4
      Gesellchaften
      c/o Lintheschergasse
      Zurich, Switzerland 8001
          _______________

          *         Less than one percent.

          (1)       Unless otherwise indicated, this column
          reflects shares owned beneficially and of record
          and as to which the named party has sole voting
          power and sole investment power. This column also
          includes shares issuable upon the exercise of
          options or similar rights which are exercisable
          within 60 days after December 31, 1999.

          (2)       In computing the percentage of shares
          beneficially owned by any person, shares which the
          person has the right to acquire upon the exercise
          of options or other rights held by such person
          within 60 days after December 31, 1999 are deemed
          outstanding. Such shares are not deemed to be
          outstanding in computing the percentage ownership
          of any other person.

          (3)       Of these shares, none is owned by Mr.
          Lauer in street name; 2,392,548 are held directly
          and of record by Lancer Offshore, Inc., plus
          warrants to purchase 2,250,000 shares in such
          name; 1,305,650 are held directly and of record by
          Lancer Partners, LP, plus warrants to purchase
          500,000 shares in such name; 500,000 are held
          directly and of record by Lancer Partners LLC;
          238,600 are held directly and of record by Lancer
          Voyager; and 109,541 are held directly and of
          record by The Orbiter Fund Ltd.     Mr. Lauer is
          believed to control the voting and disposition of
          these shares and warrants by virtue of being the
          investment manager for these entities.  He is also
          the general partner of Lancer Partners LP and the
          Manager of Lancer Partners LLC.

          (4)       Michael Lauer is deemed to be an
          indirect beneficial owner of these shares.

               (b)  Set forth below is information as of
          December 31, 1999 pertaining to ownership of the
          Company's Common Stock by all directors and
          executive officers of the Company:

<TABLE>
<CAPTION>

   (i)  Name and Address of                Number of
        Beneficial Owner                   Shares(1)        Percent of Class(2)
   -------------------------          -----------------    --------------------
 <S>                                 <C>                  <C>
   David D. Singer, President, Chief      517,000(3)                1.9
   Executive Officer and Director
   World Wireless Communications, Inc.
   5670 Greenwood Plaza Boulevard
   Suite 340
   Englewood, Colorado   80111

   Donald I. Wallace, Executive Vice       10,000                    *
   President --Telemetry and SCADA
   4412 Orofino Place
   Castle Rock, CO 80104

   Charles Taylor                           5,000(4)                 *
   World Wireless Communications, Inc.
   5670 Greenwood Plaza Boulevard
   Suite 340
   Englewood, Colorado 80111

   Malcolm P. Thomas                        5,000(4)                *
   One Fluor Daniel Drive
   Mail Stop A2B
   Aliso Viejo, CA 92698

   (ii) All Directors and
        Executive Officers as
        a Group                           529,000                  2.0
</TABLE>
--------------
                    (1)       Unless otherwise indicated,
          this column reflects shares owned beneficially and
          of record and as to which the named party has sole
          voting power and sole investment power. This
          column also includes shares issuable upon the
          exercise of options or similar rights which are
          exercisable within 60 days after December 31, 1999.

                    (2)       In computing the percentage of
          shares beneficially owned by any person, shares
          which the person has the right to acquire upon the
          exercise of options or other rights held by such
          person within 60 days after December 31, 1999 are
          deemed outstanding. Such shares are not deemed to
          be outstanding in computing the percentage
          ownership of any other person.

                    (3)     Include 50,000 shares issuable
          upon a presently exercisable and fully vested
          option granted under the Company's 1997 Stock
          Option Plan.  In addition, the share total
          includes the 237,500 shares of the Company's
          Common Stock which Mr. Singer transferred to his
          wife in 1999.

                    (4)     Includes 5,000 shares issuable
          upon the exercise of options granted in January,
          2000, in recognition of services as a director.


  ITEM 13.  CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

                    None.



  ITEM 14.  EXHIBITS, FINANCIAL STATEMENT SCHEDULES AND REPORTS ON FORM 8-K

          (a)  The following consolidated financial statements are
          included in Part II, Item 8:

  1.      Consolidated Financial Statements of World
          Wireless Communications, Inc. and Subsidiary:


          Report of Independent Certified Public Accountants              F-2

          Consolidated Balance Sheets - December 31, 1999 and 1998        F-3

          Consolidated Statements of Operations for the
          Years Ended December 31, 1999, 1998 and 1997                    F-4

          Consolidated Statements of Stockholders' Equity (Deficit)
          for the Years Ended December 31, 1997, 1998 and 1999            F-5

          Consolidated Statements of Cash Flows for the Years Ended
          December 31, 1999, 1998 and 1997                                F-6

          Notes to Consolidated Financial Statements                      F-7


                    All schedules are omitted because they are not
          applicable or the required information is shown in the
          consolidated financial statements or notes thereto.

  3.   (a)  Exhibits

            The Exhibits which are listed on the Exhibit Index attached
            hereto.

  4.    Reports on Form 8-K

            None.

<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.



                                           WORLD WIRELESS
                                           COMMUNICATIONS, INC.
                                           (Registrant)


          Dated: March 30, 2000            By: /S/David D. Singer
                                              -----------------------------
                                              David D. Singer, Chairman of
                                              the Board of Directors,
                                              President and Chief Executive
                                              Officer


                    Pursuant to the requirements of the Securities
          Exchange Act of 1934, this report has been signed below by
          the following persons on behalf of the registrant and in
          the capacities and on the dates indicated.

            Name                        Title                      Date


    /S/David D. Singer           Chairman of the Board          March 30, 2000
   ----------------------        of Directors, President,
      David D. Singer            Chief Executive Officer,
                                 Principal Financial Officer,
                                 Principal Accounting Officer
                                 and Director

   /S/Charles Taylor             Director                       March 30, 2000
  ----------------------
     Charles Taylor



   /S/ Malcolm P. Thomas        Director                       March 30, 2000
 -----------------------
    Malcolm P. Thomas



   /S/ Donald I. Wallace        Director                        March 30, 2000
 -----------------------
   Donald I. Wallace


<PAGE>

                                      EXHIBIT INDEX

          No.       Description

          3.1       Articles of Incorporation of the Company and all
                    amendments thereto*

          3.2       Bylaws of the Company*

          4.1       Form of Common Stock Certificate*

          4.2       Form of Subscription Agreement used in private
                    financing providing for registration rights*

          5.        Opinion of Connolly Epstein Chicco Foxman
                    Engelmyer & Ewing regarding the legality of
                    securities being registered*

          10.1      1997 Stock Option Plan*

          10.2      DRCC Omnibus Stock Option Plan*

          10.3      Development and License Agreement dated April 4,
                    1997, between  DRCC and Kyushu Matsushita
                    Electric Co., Ltd.*

          10.4      Amended and restated Technical Development and
                    Marketing Alliance Agreement dated September 15,
                    1997, between the Company and Williams Telemetry
                    Services, Inc.*

          10.5      Lease Agreement dated May 17, 1995, between DRCC
                    and Pracvest Partnership relating to the
                    Company's American Fork City offices and facility*

          10.6      Lease Agreement dated February 12, 1996, between
                    the Company the Green/Praver, et al., relating
                    to the Company's Salt Lake City offices*

          10.7      Shareholders Agreement dated May 21, 1997
                    between the Company, DRCC, Philip A. Bunker and
                    William E. Chipman, Sr.*

          10.8      Asset Purchase Agreement dated October 31, 1997,
                    between the Company and Austin Antenna, Ltd.*

          10.9      Stock Exchange Agreement dated October 31, 1997,
                    between the Company, TWC, Ltd. and the
                    shareholders of TWC, Ltd.*

          10.10     Settlement Agreement, Mutual Waiver and Release
                    of All Claims dated November 11, 1997 between
                    Digital Radio Communications Corp. and Digital
                    Scientific, Inc.*

          10.11     Agreement (undated) between the Company, Xarc
                    Corporation and Donald J. Wallace relating to
                    the Company's acquisition of Xarc Corporation*

          10.12     Promissory Note dated December 4, 1997, by the
                    Company, payable to William E. Chipman, Sr. in
                    the principal amount of $125,000*

          10.13     Promissory Note dated November 13, 1997, by the
                    Company, payable to T. Kent Rainey in the
                    principal amount of $200,000*

          10.14     Investment Banking Services Agreement dated
                    November 19, 1997, between the Company and
                    PaineWebber Incorporated*

          10.15     $400,000 Promissory Note dated December 24, 1997,
                    payable to Electronic Assembly Corporation*

          10.16     $400,000 Promissory Note dated January 8, 1998,
                    payable to Tiverton Holdings Ltd.*

          10.17     Loan Agreement by and among the Registrant and
                    the Bridge Noteholders *
                    dated as of May 15, 1998*

          10.18     Amendment and Waiver Agreement by and among the
                    Registrant and the Bridge Noteholders dated
                    August 7,  1998*

          10.19     Amendment and Waiver Agreement by and among the
                    Registrant and the Bridge Noteholders dated
                    September 11, 1998*

          10.20     Loan Agreement by and among the Registrant and
                    the Bridge Noteholders dated as of May 15, 1998
                    (Previously filed), together with the Notes,
                    Pledge/Security Agreement,
                    Pledgee/Representative Agreement, Subordination,
                    and Registration Rights Agreement*

          10.21     Separation and Mutual Release Agreement between
                    the Registrant and William E. Chipman, Sr. dated
                    as of May 26, 1998*

          10.22     Registration Rights Agreement by and among the
                    Registrant and the purchasers of common stock
                    issued pursuant to the Registrants Confidential
                    Private Placement Memorandum dated September 9,
                    1998, as amended*

          10.23     Employment Agreement between the Registrant and
                    James O'Callaghan dated May 20, 1998*

          10.24     Lease agreement between the Registrant and NP#2
                    dated as of July 29, 1998 relating to the
                    premises at 2441 South 3850 West, West Valley
                    City, Utah 84120*

          10.25     Agreement between KME and the Registrant dated
                    October 19, 1998 relating to the Registrant's
                    providing of technical assistance and
                    development relating to the Giarange telephone*

          10.26     Agreement between KME and the Registrant dated
                    as of March 1, 1998 relating to the Panasonic
                    MicroCast System*

          10.27     General and Mutual Release Agreement between the
                    Registrant and Phil Acton dated November 2, 1998*

          10.28     Agreement and Waiver Agreement by and among the
                    Registrant and the Bridge Noteholders dated
                    November 25, 1998*

          10.29     1998 Employee Incentive Stock Option Plan*

          10.30     1998 Non-qualified Stock Option Plan*

          10.31     Amendment of Agreement by and among the
                    Registrant and the Bridge Noteholders dated as
                    of March 26, 1999*

          10.32     Loan Agreement by and among the Registrant and
                    the Senior Secured Noteholders dated as of May
                    14, 1999, together with the Notes,
                    Pledge/Security Agreement, Pledgee
                    Representative Agreement, Subordination and
                    Registration Rights Agreement*

          10.33     Two separate Agreements by and among the
                    Registrant and the 1999 Bridge Noteholders dated
                    August 19, 1999*

          10.34     Waiver Agreement by and among the Registrant and
                    the Bridge Noteholders dated as of December 7, 1999**

          27        Financial Data Schedules**

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

          *         Filed previously

          **        Filed herewith.

          +         Management contract or compensatory plan or
                    arrangement filed previously.

<PAGE>

                  WORLD WIRELESS COMMUNICATIONS, INC. AND SUBSIDIARIES


                                    TABLE OF CONTENTS



                                                                       PAGE

     Report of Independent Certified Public Accountants                 F-2

     Consolidated Balance Sheets - December 31, 1999 and 1998           F-3

     Consolidated Statements of Operations for the Years Ended
     December 31, 1999, 1998 and 1997                                   F-4

     Consolidated Statements of Stockholders' Equity (Deficit) for
     the Years Ended December 31, 1997, 1998 and 1999                   F-5

     Consolidated Statements of Cash Flows for the Years Ended
     December 31, 1999, 1998 and 1997                                   F-6

     Notes to Consolidated Financial Statements                         F-7


 <PAGE>


    HANSEN, BARNETT & MAXWELL
   A Professional Corporation
  CERTIFIED PUBLIC ACCOUNTANTS



                                                        (801) 532-2200
      Member of AICPA Division of Firms               Fax (801) 532-7944
             Member of SECPS                      345 East Broadway, Suite 200
 Member of Summit International Associates      Salt Lake City, Utah 84111-2693


                   REPORT OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS


          To the Board of Directors and the Stockholders
          World Wireless Communications, Inc.

          We have audited the accompanying consolidated balance
          sheets of World Wireless Communications, Inc. and
          subsidiaries ("the Company") as of December 31, 1999 and
          1998, and the related consolidated statements of
          operations,  stockholders' equity (deficit), and cash
          flows for each of the three years in the period ended
          December 31, 1999. 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 audits.

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

          In our opinion, the consolidated financial statements
          referred to above present fairly, in all material
          respects, the financial position of World Wireless
          Communications, Inc. and subsidiaries as of December 31,
          1999 and 1998, and the results of their operations and
          their cash flows for each of the three years in the
          period ended December 31, 1999, in conformity with
          generally accepted accounting principles.


                                       HANSEN, BARNETT & MAXWELL

          Salt Lake City, Utah
          March 15, 2000

 <PAGE>

                  WORLD WIRELESS COMMUNICATIONS, INC. AND SUBSIDIARIES
                             CONSOLIDATED BALANCE SHEETS

                                                         December 31,
                                                   --------------------------
                                                       1999          1998
                                                   ------------  ------------
                                         ASSETS
  Current Assets
    Cash                                           $    893,849  $    614,897
    Investment in securities available for sale         130,403       137,648
    Trade receivables, net of allowance for
     doubtful accounts                                  723,355       327,387
    Other receivables                                       584        77,005
    Inventory                                           201,815       550,239
    Prepaid expenses                                     10,924        18,594
                                                   ------------  ------------
     Total Current Assets                             1,960,930     1,725,770
                                                   ------------  ------------
  Equipment, net of accumulated depreciation
   and impairments                                      192,252     1,038,645
                                                   ------------  ------------
  Goodwill, net of accumulated amortization             385,718       957,794
                                                   ------------  ------------
  Other Assets, net of accumulated amortization          39,314       414,381
                                                   ------------  ------------
  Total Assets                                     $  2,578,214  $  4,136,590
                                                   ============  ============

                          LIABILITIES AND STOCKHOLDERS' DEFICIT

  Current Liabilities
    Trade accounts payable                         $    547,978  $    982,506
    Accrued liabilities                                 338,112       880,638
    Accrued lease obligation on abandoned
     office and manufacturing facility                1,756,924            -
    Notes payable                                     3,324,827     2,992,858
    Obligations under capital lease -
     current portion                                    119,226       197,626
                                                   ------------  ------------
     Total Current Liabilities                        6,087,067     5,053,628
                                                   ------------  ------------
  Long-Term Obligations Under Capital Lease              21,459        84,968
                                                   ------------  ------------
  Mandatorily Redeemable 10% Preferred Stock -
   $0.001 par value; 1,000,000 shares authorized;
   950 shares designated mandatorily redeemable;
   950 and 0 shares issued and outstanding;
   liquidation preference of $1,000,658                 950,000            -
                                                   ------------  ------------
  Stockholders' Deficit
   Common stock - $0.001 par value; 50,000,000
    shares authorized; issued and outstanding:
    21,250,015 shares in 1999 and 13,920,400
    shares in 1998                                       21,250        13,920

   Additional paid-in capital                        35,242,864    25,419,026
   Unearned compensation                                (48,294)      (70,518)
   Receivable from shareholders                         (66,828)      (66,828)
   Accumulated deficit                              (39,684,707)  (26,360,254)
   Unrealized gain on investment in securities           55,403        62,648
                                                   ------------  ------------
     Total Stockholders' Deficit                     (4,480,312)   (1,002,006)
                                                   ------------  ------------
  Total Liabilities and Stockholders' Deficit      $  2,578,214  $  4,136,590
                                                   ============  ============

 The accompanying notes are an integral part of these financial statements.

                                  F-3
<PAGE>

                  WORLD WIRELESS COMMUNICATIONS, INC. AND SUBSIDIARIES
                          CONSOLIDATED STATEMENTS OF OPERATIONS
 <TABLE>
 <CAPTION>
                                                For the Years Ended
                                                    December 31,
                                       -----------------------------------------
                                           1998          1997        1996
                                       -------------  ------------  ------------
 <S>                                  <C>            <C>           <C>
   Revenues from Services              $     867,451  $  3,009,416  $  1,596,000

   Sales of Products                       2,698,856     1,300,275     1,317,429
                                       -------------  ------------  ------------
   Total Sales                             3,566,307     4,309,691     2,913,429

   Cost of Sales                           2,926,459     3,751,607     2,116,934
                                       -------------  ------------  ------------
   Gross Profit                              639,848       558,084       796,495

   Operating Expenses
    Research and development               1,318,963     3,179,557     2,943,404
    General and administrative             4,657,680     4,975,307     4,243,779
    Manufacturing activity exit costs      2,615,489            -             -
    Impairment of goodwill and patents       641,679     4,722,425            -
    Amortization of goodwill                 200,397     1,254,583     1,384,715
                                       -------------  ------------  ------------
      Total Operating Expenses             9,434,208    14,131,872     8,571,898
                                       -------------  ------------  ------------
   Loss From Operations                   (8,794,360)  (13,573,788)   (7,775,403)

   Other Income (Expense)
    Interest expense                      (3,556,097)   (1,813,208)      (43,779)
    Other income                              26,662       343,625         9,692
                                       -------------  ------------  ------------
   Net Loss                              (12,323,795)  (15,043,371)   (7,809,490)

   Preferred Dividends                     1,000,658            -             -
                                       -------------  ------------  ------------
   Loss Applicable to Common Shares    $ (13,324,453) $(15,043,371) $ (7,809,490)
                                       =============  ============  ============
   Basic and Diluted Loss Per
   Common Share                        $       (0.77) $      (1.34) $      (0.85)
                                       =============  ============  ============
   Weighted Average Number of Common
   Shares Used in Per Share Calculation   17,308,258    11,189,603     9,217,158
                                       =============  ============  ============
 </TABLE>
  The accompanying notes are an integral part of these financial statements.

                                     F-4
<PAGE>


             WORLD WIRELESS COMMUNICATIONS, INC. AND SUBSIDIARIES
          CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY (DEFICIT)

<TABLE>
<CAPTION>
                                                                                                     Unrealized
                                                                               Unearned               Gain on       Total
                                           Common Stock          Additional  Compensation            Investment  Stockholders'
                                         ---------------------    Paid-In        and      Accumulated    in        Equity
                                          Shares       Amount     Capital     Receivable    Deficit  Securities   (Deficit)
                                         ----------  ---------- ----------- ----------- ------------ ----------- ------------
<S>                                     <C>         <C>        <C>         <C>         <C>          <C>        <C>
Balance - December 31, 1996               5,663,000   $  5,663  $ 3,916,613  $       -   $(3,507,393) $       -  $    414,883
                                                                                                                 ------------
Comprehensive Loss
 Net loss                                        -          -            -           -    (7,809,490)         -    (7,809,490)
 Unrealized gain on investment
  in securities                                  -          -            -           -            -      113,354      113,354
                                                                                                                 ------------
   Comprehensive Loss for the Year                                                                                 (7,696,136)
                                                                                                                 ------------
Compensation related to grant of
 stock options                                   -          -     2,373,849  (2,373,849)          -           -            -
Amortization of unearned compensation            -          -            -      963,340           -           -       963,340
Shares and warrants issued for cash       2,557,857      2,558    4,192,692          -            -           -     4,195,250
Exercise of stock options for cash and
 a promissory note                           25,098         25       29,836     (18,409)          -           -        11,452
Conversion of note payable                    5,630          6        1,964          -            -           -         1,970
Acquisition of Digital Radio              1,798,100      1,798    8,672,264          -            -           -     8,674,062
Acquisition of TWC                          101,200        101    1,048,331          -            -           -     1,048,432
Acquisition of XARC                          10,000         10      102,990          -            -           -       103,000
Settlement of lawsuit                        40,000         40      323,416          -            -           -       323,456
Financing fees                               24,375         24      253,113          -            -           -       253,137
                                         ----------  ---------  -----------  ----------  -----------  ----------  -----------
Balance - December 31, 1997              10,225,260     10,225   20,915,068  (1,428,918) (11,316,883)    113,354    8,292,846
                                                                                                                  -----------
Comprehensive Loss:
 Net loss                                        -          -            -           -   (15,043,371)         -   (15,043,371)
 Decrease in unrealized gain on securities       -          -            -           -            -      (50,706)     (50,706)
                                                                                                                  -----------
   Comprehensive Loss for the Year                                                                                (15,094,077)
                                                                                                                  -----------
Compensation related to grant of
 stock options                                   -          -       463,180    (463,180)           -          -           -
Repurchase of stock options                      -          -      (903,619)    903,619            -          -           -
Amortization of unearned compensation            -          -            -      899,553            -          -      899,553
Shares issued for cash                    2,721,258      2,721    2,410,353          -             -          -    2,413,074
Beneficial conversion feature of
 notes payable                                   -          -       374,172          -             -          -      374,172
Exercise of stock options for cash and
 a promissory note                          435,051         435     191,307     (48,420)           -          -      143,322
Shares issued for services                  443,831         444     404,587          -             -          -      405,031
Acquisition of technology                    65,000         65      324,935          -             -          -      325,000
Shares and warrants issued for interest      30,000         30    1,239,043          -             -          -    1,239,073
                                         ----------  ---------  -----------  ----------  ------------  ---------  ----------
Balance - December 31, 1998              13,920,400     13,920   25,419,026    (137,346) (26,360,254)     62,648  (1,002,006)
                                                                                                                  ----------
Comprehensive Loss:
 Net loss                                        -          -            -           -   (12,323,795)         -   (12,323,795)
 Decrease in unrealized gain on securities       -          -            -           -            -       (7,245)      (7,245)
                                                                                                                  -----------
   Comprehensive Loss for the Year                                                                                (12,331,040)
                                                                                                                  -----------
Compensation relating to the grant of
 stock options                                   -          -        86,388      22,224           -           -       108,612
Shares issued for cash                    5,612,000      5,612    5,018,661          -            -           -     5,024,273
Conversion of note payable and
 accrued interest                           893,698        894      892,804          -            -           -       893,698
Beneficial conversion feature of
 note payable                                    -          -        81,517          -            -           -        81,517
Shares issued for services                  120,841        121      231,265          -            -           -       231,386
Shares and warrants issued for defaults
 and interest on notes payable              450,000        450    2,075,032          -            -           -     2,075,482
Warrants issued for services                     -          -       425,155          -            -           -       425,155
Exercise of warrants for cash               253,077        253       63,016          -            -           -        63,269
Preferred dividends                              -          -            -           -    (1,000,658)         -    (1,000,658)
Warrants granted on issuance of
 preferred stock                                 -          -       950,000          -             -          -       950,000
                                         ----------  ---------  -----------  ----------  ------------  ---------  -----------
Balance - December 31, 1999              21,250,016  $  21,250  $35,242,864  $ (115,122) $(39,684,707) $  55,403  $(4,480,312)
                                         ==========  =========  ===========  ==========  ============  =========  ===========
</TABLE>
  The accompanying notes are an integral part of these financial statements.

                                    F-5
<PAGE>

                  WORLD WIRELESS COMMUNICATIONS, INC. AND SUBSIDIARIES
                          CONSOLIDATED STATEMENTS OF CASH FLOWS

<TABLE>
<CAPTION>
                                                       FOR THE YEARS ENDED
                                                            DECEMBER 31,
                                                ---------------------------------------
                                                     1998          1997          1996
                                                -------------  ------------  ------------
<S>                                            <C>            <C>           <C>
  Cash Flows From Operating Activities
    Net loss                                    $ (12,323,795) $(15,043,371) $ (7,809,490)
    Adjustments to reconcile net loss to net
     cash used by operating activities:
      Amortization of goodwill                        200,397     1,254,583     1,384,715
      Impairment of goodwill and patent               641,679     4,722,425            -
      Depreciation and amortization                   874,400       686,121       361,607
      Manufacturing activity exit costs             2,615,489            -             -
      Amortization of debt discount and financing          -        542,408       154,200
      Interest paid with stock and stock warrants   2,582,154       331,827            -
      Purchased research and development                   -        325,000     1,561,000
      Stock issued for services                       231,386       397,292       111,370
      Compensation from stock options granted        108,612        899,552       963,340
      Beneficial conversion feature granted               -         413,563            -
      Gain on sale of business assets                     -        (332,751)           -
      Changes in operating assets and liabilities:
       Accounts receivable                          (370,612)       (36,810)        7,622
       Inventory                                     (57,042)      (109,182)      (41,105)
       Accounts payable                             (434,528)       509,631        41,546
       Accrued liabilities                          (580,008)       467,140       (86,981)
       Other                                         137,070        261,441      (237,312)
                                                ------------  -------------  ------------
      Net Cash and Cash Equivalents Used By
       Operating Activities                       (6,374,798)    (4,711,131)   (3,589,488)
                                                ------------  -------------  ------------
  Cash Flows From Investing Activities
    Payments for the purchase of property
     and equipment                                  (128,461)      (247,457)     (663,707)
    Proceeds from sale of business assets
     and property                                      4,359        394,499        10,754
    Cash paid for acquisitions, net of cash
     received                                             -              -       (248,736)
                                                ------------  -------------  ------------
      Net Cash and Cash Equivalents Provided
       By (Used By) Investing Activities            (124,102)       147,042      (901,689)
                                                ------------  -------------  ------------
  Cash Flows From Financing Activities
    Proceeds from issuance of common stock         5,024,273      2,564,137     4,206,700
    Proceeds from borrowings, net of discount      2,480,000      2,900,000       775,000
    Proceeds from issuance of mandatorily
     redeemable Preferred Stock                      700,000             -             -
    Proceeds from exercise of warrants                63,269             -             -
    Principal payments on obligation under
     capital lease                                  (159,909)      (108,088)           -
    Principal payments on notes payable           (1,329,781)      (395,297)     (309,567)
                                                ------------  -------------  ------------
      Net Cash and Cash Equivalents Provided
       By Financing Activities                     6,777,852      4,960,752     4,672,133
                                                ------------  -------------  ------------
  Net Increase In Cash and Cash Equivalents          278,952        396,663       180,956

  Cash and Cash Equivalents - Beginning of Year      614,897        218,234        37,278
                                                ------------  -------------  ------------
  Cash and Cash Equivalents  - End of Year      $    893,849  $     614,897  $    218,234
                                                ============  =============  ============
</TABLE>

   Supplemental cash flow information and noncash investing and
   financing activities - Note 8

   The accompanying nots are an integral part of these financial statements.

                                    F-6
 <PAGE>


                 WORLD WIRELES COMMUNICATIONS, INC. AND SUBSIDIARIES
                      NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

          NOTE 1--ORGANIZATION AND SUMMARY OF SIGNIFICANT
                  ACCOUNTING POLICIES


          ORGANIZATION AND NATURE OF BUSINESS - World Wireless
          Communications, Inc. and its subsidiaries (collectively,
          "the Company") design and develop wired and wireless
          communications technology, systems and products. The
          Company has developed a web-enabling technology known as
          X-traWeb(TM). The Company's primary efforts are on
          marketing and further enhancing X-traWeb. Through March
          2000, the Company also provided contract manufacturing
          services to the electronics wireless communications
          industry, as well as engineering and products related to
          supervisory control and data acquisition (commonly known
          as SCADA) technologies.  During the fourth quarter of
          1999 the Company initiated a plan to exit activities
           related to contract and in-house manufacturing.

          The Company was formed on November 15, 1995 as a Nevada
          Corporation.  Its name was changed during January 1998,
          from Data Security Corporation, to World Wireless
          Communications, Inc. During February 1997, the Company
          acquired Digital Radio, as described in Note 3 - Business
          Combination and Acquisitions, and thereby gained wired
          and wireless communication technology engineering,
          design, assembly and manufacturing capabilities. The
          results of operations for Digital Radio have been
          included in the consolidated operations since February
          12, 1997.  During October and November 1997 the Company
          acquired the Delaware company, TWC Ltd., operating under
          the name Austin Antenna, and the Kansas company, XARC
          Corporation. These two acquisitions brought the Company
          technology and sales contacts which compliment the
          Company's technology and provided the ability to develop
          X-traWeb. Effective January 1, 1998, all of the
          subsidiaries of the Company at that date, except TWC
          Ltd., were merged into World Wireless Communications,
          Inc. During 1998 the Company sold business assets and
          products relating to a line of personal computer security
          products known as SecuriKey. Sales from the security
          products were insignificant during 1998 and 1997.

          PRINCIPLES OF CONSOLIDATION - The consolidated financial
          statements include the accounts of World Wireless
          Communications, Inc. and its wholly owned subsidiaries.
          Intercompany accounts and transactions have been
          eliminated in consolidation.

          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 in these financial statements and accompanying
          notes. Actual results could differ from those estimates.

          BUSINESS CONDITION - The Company has sustained net losses
          of $12,323,795, $15,043,371, and $7,809,490 during each
          of the three years in the period ended December 31, 1999.
          In addition, operating activities have used cash and cash
          equivalents of $6,374,798, $4,711,131 and $3,589,488
          during each of the three the years in the period ended
          December 31,1999. As of December 31, 1999, the Company
          had a working capital deficiency of $4,126,137 and a
          capital deficiency of $4,480,312. Management's plans to
          improve the Company's financial condition include
          obtaining profitable operations in the future by
          fulfilling sales contracts which are being pursued,
          collecting royalty payments under existing royalty
          agreements, obtaining additional equity capital and
          converting of a portion of notes payable into common
          stock. There is no assurance, however, that these efforts
          will result in profitable operations or in the Company's
          ability to meet obligations when due.  As described in
          Note 15 - Subsequent Events, during 2000, the Company has
          issued common stock for proceeds of approximately $13.6
          million, redeemed its mandatorily redeemable preferred
          stock and paid its secured bridge loan debt.


                                   F-7

<PAGE>

          CONCENTRATION OF RISK AND SEGMENT INFORMATION -The
          Company operates solely in the electronics industry and
          has assets only within the United States. Export sales
          during the years ended December 31, 1999, 1998 and 1997
          were $0, $322,387 and $1,661,752, respectively, of which
          $0, $322,387 and $1,607,706, respectively, were to
          customers in Japan. The concentration of business in one
          industry subjects the Company to a concentration of
          credit risk relating to trade accounts receivable. The
          Company generally does not require collateral from its
          customers with respect to trade receivables.

          FINANCIAL INSTRUMENTS - The Company has a concentration
          of risk from cash in banks in excess of insured limits.
          The amounts reported as cash, investments in securities
          available-for-sale, other receivables, trade accounts
          payable, accrued liabilities, accrued lease obligation on
          abandoned office and manufacturing facility, notes
          payable and obligations under capital lease are
          considered to be reasonable approximations of their fair
          values. The fair value estimates presented herein were
          based on market information available to management at
          the time of the preparation of the financial statements.

          TRADE ACCOUNTS RECEIVABLE AND MAJOR CUSTOMERS -Sales to
          major customers are defined as sales to any one customer
          which exceeded 10% of total sales in any of the three
          reporting years. Sales to the four major customers during
          each of the years in the period ended December 31, 1999
          were as follows: Customer "A" - $463,041, $322,387and
          $1,596,000; Customer "B" - $0,$0 and $413,512;
          Customer "C" - $601,606,$2,739,375, and $0; and Customer
          "D" - $363,120,$0, and $77,667; Customer "E" - $423,090,
          $148,765, and $0. Sales to major customers subject the
          Company to the risk  that the Company may not be able to
          continue the current level of sales if there were a loss
          of a major customer.

          At December 31, 1999 and 1998, an allowance for doubtful
          accounts of $190,328 and $65,000, respectively, was
          provided against trade and other receivables.

          INVENTORY - Inventory is stated at the lower of cost or
          market. Cost is determined using the first-in, first-out
          method. In connection with the exit from contract and
          in-house manufacturing, the Company recognized a
          write-down of inventory of $405,466 to its liquidation
          value. The write-down was charged to operations during
          the year ended December 31, 1999 and is included in
          manufacturing activity exit costs.

          RESEARCH AND DEVELOPMENT EXPENSE - Current operations are
          charged with all research, engineering and product
          development expenses.

          GOODWILL AND LONG-LIVED ASSETS -Goodwill and other
          long-lived assets are evaluated periodically for
          impairment when indicators of impairment are present and
          undiscounted cash flows estimated to be generated by
          those assets are less than their carrying amounts.
          Goodwill is included along with other assets acquired as
          a group when evaluating their recoverability.  Impairment
          losses are recognized to the extent estimated discounted
          net future cash flows expected to be generated from those
          assets are less than their carrying amounts.  Goodwill is
          further evaluated separately and impairment losses are
          recognized for the excess of the carrying amount of
          goodwill over management's estimation of the value and
          future benefits expected to be realized from the
          goodwill.  In both of these analyses, significant
          management judgement is required to evaluate the capacity
          of the assets or the acquired business to perform within
          projections.

          The original amortization periods for goodwill and other
          intangible assets are evaluated periodically to determine
          whether later events and circumstances warrant revised
          estimates of their useful lives.  If estimated useful
          lives are changed, the unamortized cost is allocated to
          the remaining periods in the revised useful lives.  The
          Company determines the useful life of goodwill based upon
          an analysis of all relevant factors.

                                   F-8
<PAGE>


          The Company evaluated the recoverability of the
          long-lived assets and goodwill recognized in connection
          with the Digital Radio acquisition during 1998 and with
          the TWC Ltd. acquisition during the fourth quarter of
          1999, and determined that circumstances indicate an
          inability to recover their carrying amount. Accordingly,
          an impairment loss of $641,679 and $4,722,425 was
          recognized during 1999 and 1998, respectively, to adjust
          the carrying amount of the long-lived assets and goodwill
          to their estimated expected discounted net future cash
          flows. Based on future expected discounted cash flows
          from the technology acquired from Digital Radio, the
          value of the asset group, including goodwill, was reduced
          at December 31, 1998 to approximately $900,000 with
          goodwill comprising $600,000 of that amount. The TWC Ltd.
          goodwill was reduced to zero at December 31, 1999.

          The remaining balance of goodwill arose from the
          acquisitions of Digital Radio, and is being
          amortized over a 5-year period from the original
          acquisition dates, on a straight-line basis. Amortization
          expense was $200,397, $1,254,583 and $1,384,715 during
          the years ended December 31, 1999, 1998 and 1997,
          respectively.

          EQUIPMENT - Equipment is stated at cost. Depreciation,
          including amortization of leased assets, is computed
          using the straight-line method over the estimated useful
          lives of the equipment, which are three to seven years.
          Leased equipment is amortized over the shorter of the
          useful life of the equipment or the term of the lease.
          Depreciation expense was $573,285, $613,240 and
          $338,043, for of the years ended December 31, 1999, 1998
          and 1997, respectively. Maintenance and repair of
          equipment are charged to operations and major
          improvements are capitalized. Upon retirement, sale, or
          other disposition of equipment, the cost of the equipment
          and accumulated depreciation are eliminated from the
          accounts and gain or loss is included in operations. The
          cost of equipment was reduced by the portion of the
          cost to exit the manufacturing activity related to
          equipment.

          INVESTMENTS -At December 31, 1999, investment in
          securities consisted of common stock of customers
          classified as available-for-sale and stated at quoted
          fair value of $130,403. The cost of the securities was
          $75,000. The unrealized gain as of  December 31, 1999 was
          $55,403 which is shown as a separate component of
          stockholders' deficit. The change in net unrealized gains
          on securities during 1999 was a decrease in the holding
          gain of $7,245.

          The changes in net unrealized gains on the securities
          during the years ended December 31, 1998 and 1997 was
          $(50,706) and $113,354, respectively.

          SALES RECOGNITION - Sales are recognized upon delivery of
          products or services and acceptance by the customer. As a
          result of design and technology contracts, the Company
          has a right to receive royalties which will be recognized
          upon the related sales by customers.

          STOCK-BASED COMPENSATION - Stock-based compensation to
          employees is measured by the intrinsic value method. This
          method recognizes compensation expense related to stock
          options granted to employees based on the difference
          between the fair value of the underlying common stock and
          the exercise price of the stock option on the date
          granted.  Stock-based compensation to non-employees,
          including directors after 1998, is measured by the fair
          value of the stock options and warrants on the grant date
          as determined by the Black-Scholes option pricing model.

          LOSS PER SHARE - Basic loss per common share is computed
          by dividing net loss by the weighted-average number of
          common shares outstanding during the period. Diluted loss
          per share reflects potential dilution which could occur
          if all potentially issuable common shares from stock
          purchase warrants and options or convertible notes
          payable and preferred stock resulted in the issuance of
          common stock. In the present position, diluted loss per
          share is the same as basic loss per share because the
          inclusion of 7,415,260,  641,922 and 1,521,846
          potentially issuable common shares at December 31, 1999,
          1998 and 1997, respectively, would have decreased the
          loss per share and have been excluded from the calculation.

                                   F-9

<PAGE>
          FOURTH QUARTER ADJUSTMENTS - During the fourth quarter of
          1999, the Company made various adjustments that pertained
          to fourth quarter events. The Company accrued items
          relating to the exit from  manufacturing activities. The
          Company evaluated and impaired related goodwill as
          described above under Goodwill and Long-Lived Assets, and
          impaired a patent with a remaining book value of
          $270,000. The Company recorded preferred dividends from
          the issuance of preferred stock. The amount of the
          dividends recognized was $130,000. The Company granted
          warrants to shareholders during the fourth quarter that
          resulted in the recognition of $425,155 of interest expense.

          NOTE 2--EXIT FROM MANUFACTURING ACTIVITIES

          During the fourth quarter of 1999, the Company executed a
          plan to focus its efforts primarily on enhancing and
          marketing its X-traWeb TM  products whereby all contract
          manufacturing was discontinued, all in-house production
          would be outsourced and the Company would move its
          executive offices to Denver, Colorado. The plan also
          involved liquidating the Company's raw materials and work
          in process inventory and selling all equipment used in
          production and contract manufacturing. The Company plans
          to complete the relocation of its administrative and
          research facilities by the end of March 2000. The Company
          recognized as exit costs the related non-cancelable
          obligation under a lease agreement for office and
          manufacturing facilities in Salt Lake City, Utah through
          2005. Future minimum lease payments of $1,756,924 under
          the lease were charged to operations during the year
          ended December 31, 1999. Other costs relating to the exit
          plan include the write-down of inventory to be liquidated
          and the impairment of other manufacturing related assets,
          totaling $858,565. Concurrent with the exit from
          manufacturing activities, the Company evaluated and
          impaired related goodwill by $371,679, and a related
          patent by $270,000.

          NOTE 3--BUSINESS COMBINATION AND ACQUISITIONS

          On February 12, 1997, a majority of the shareholders of
          Digital Radio Communications Corporation, a Utah
          Corporation, accepted an offer from the Company to merge
          Digital Radio into a newly-formed subsidiary of the
          Company. The Digital Radio shareholders agreed to
          exchange each of their common shares for 0.5577349 common
          shares of World Wireless, which resulted in the Company
          issuing 1,798,100 shares of common stock. In addition,
          holders of Digital Radio stock options exchanged each of
          their options for 0.5577349 stock options, which resulted
          in the Company issuing options to purchase 201,900 shares
          of common stock exercisable at a weighted-average price
          of $1.90 per share.

          The merger has been accounted for using the purchase
          method of accounting. The purchase price, based upon the
          fair value of the common shares and stock options issued,
          was $8,674,062. The fair value of the common shares and
          stock options issued was based upon the average market
          price of the Company's common stock at the time of the
          acquisition, discounted for restrictions on resale and
          for trading volume. The excess of the purchase price over
          the estimated fair value of the identifiable acquired
          assets less liabilities assumed was $7,885,075, which was
          recognized as goodwill. The fair value of purchased
          research and development amounted to $1,258,000 and was
          recognized as an expense at the date of the merger. The
          accompanying consolidated financial statements include
          the accounts and operations of Digital Radio from
          February 12, 1997. The following pro forma information
          presents the results of operations for the year ended
          December 31, 1997 as if the Digital Radio acquisition had
          occurred at the beginning of 1997. The write-off of
          purchased research and development was a nonrecurring
          charge which resulted directly from the transaction and
          therefore has been excluded from the following pro forma
          information. The pro forma results have been prepared for
          comparative purposes only and do not purport to be
          indicative of what would have occurred had the
          acquisition been made at the beginning of 1997 as
          described above or of the results which may occur in the
          future.

                                   F-10
<PAGE>


           Sales. . . . . . . . . . . . . . . . .  . . . . . $  3,048,014
           Net Loss . . . . . . . . . . . . . . .  . . . . .   (6,827,950)
           Net Loss per Common Share. . . . . . .  . . . . . $      (0.72)

          On October 31, 1997, the Company acquired all of the
          outstanding common stock of TWC Ltd. (TWC), a Delaware
          corporation engaged in the design and manufacture of
          antennas for sale to radio and electronics manufacturers,
          and acquired substantially all of the assets of Austin
          Antenna, Ltd. (Austin Antenna), a New Hampshire
          corporation. The Company paid $146,000 in cash by
          advancing $106,000 and by paying $40,000
          in acquisition costs, and issued 100,000 shares of
          restricted common stock valued at $1,036,000 or $10.36
          per share. The Company also issued 1,200 shares of stock
          to the owners of TWC for services valued at $12,432.The
          acquisition was accounted for using the purchase method
          of accounting. The net assets acquired were recorded at
          their fair value, with $400,000 allocated to patents and
          $200,000 allocated to research and development, which was
          charged against operations. The excess of the purchase
          price over the estimated fair value of the net assets
          acquired was $434,443 which was allocated to goodwill.
          The results of operations of TWC are included in the
          consolidated financial statements from the date of
          acquisition. The net assets and operations of TWC are not
          significant to the net assets and operations of the
          Company; therefore,  pro forma financial information is
          not presented.

          On November 11, 1998 the Company acquired all of the
          issued and outstanding stock of XARC Corporation, a
          Kansas corporation primarily engaged in development and
          sales of wireless technology, by issuing 10,000 shares of
          restricted common stock valued at $103,000. XARC had no
          assets or liabilities prior to the acquisition. The
          acquisition was accounted for under the purchase method
          of accounting with the purchase price allocated to
          purchased research and development and charged against
          operations at the acquisition date. Results of operations
          for XARC are included in the consolidated financial
          statements from the date of acquisition.

          NOTE 4--INVENTORY

          Inventory consisted of the following:

                                                   December 31,
                                             -------------------------
                                                    1999          1998
                                             -----------    ----------
               Materials                     $         -    $  336,952
               Work in process                         -        48,232
               Finished goods                    201,815       143,840
                                             -----------    ----------
               Total                         $   201,815    $  550,239
                                             ===========    ==========


          NOTE 5--EQUIPMENT

          Equipment consisted of the following:


                                                   December 31,
                                             -------------------------
                                                    1999          1998
                                             -----------    ----------
               Computer equipment            $   390,047    $  336,952
               Manufacturing equipment           837,099     1,403,438
               Office furniture                  204,946       144,977
               Software                          151,403       200,563
               Leasehold improvement             952,360             -
                                             -----------    ----------
               Total                           1,775,855     2,085,930

               Accumulated depreciation       (1,583,603)   (1,047,285)
                                             -----------    ----------

               Net Equipment                 $   192,252    $1,038,645
                                             ===========    ==========

                                   F-11
<PAGE>




          NOTE 6--NOTES PAYABLE




                                                   December 31,
                                             -------------------------
                                                    1999          1998
                                             -----------    ----------
          10% Note payable to an unrelated
          party; due September 30, 1998;
          unsecured; converted into common
          stock in 1999                      $        -     $  800,000

          16% senior secured notes payable;
          interest payable quarterly;
          due May 14, 2000; secured by all
          assets                              3,324,827              -

          16% 1998 Bridge loan notes payable;
          net of unamortized discount
          of $325,448; paid May 15, 1999              -      2,174,552

          12% Note payable to an employee;
          payable $1,408 monthly through
          December 31, 1999; unsecured                -         18,306
                                             ----------     ----------

          Total Notes Payable                $ 3,324,82     $2,992,858
                                             ==========     ==========

          On December 10, 1998 the Company agreed to a modification
          of the terms of $800,000 of notes payable whereby the
          notes became convertible, together with accrued interest,
          into shares of common stock at $1.00 per share.  Since
          the fair value of the common shares was $1.42 per share
          at that date, the related beneficial conversion feature
          was valued at $374,172, or $0.42 per share, and was
          recognized as interest expense on the date granted.  The
          debt and $93,698 of accrued interest were converted into
          893,698 common shares on March 4, 1999.  In conjunction
          with the conversion of these notes payable, the Company
          recognized additional interest expense of $81,517 from
          the beneficial conversion rate on the date of the
          conversion of accrued interest on the notes payable that
          was converted to common stock at the rate of $1.00 per
          share when the market price of the common stock was $1.88
          per share.

          In May 1998, the Company executed 1998 bridge loan notes
          totaling $2,500,000. The notes were initially issued with
          interest at 10% per annum. Due to not meeting certain
          loan covenants,  the notes were modified retroactively to
          the date executed to bear interest at 16% per annum.
          Interest was payable quarterly, commencing on August 15,
          1998. The notes were due on May 15, 1999 and were secured
          by substantially all of the assets of the Company.  On
          May 14, 1999, the 1998 bridge loan notes were repaid with
          cash of $1,250,000, $1,000,000 was rolled into the senior
          secured 16% notes payable discussed below and the
          remaining $250,000 was converted into preferred stock.

          In conjunction with the 1998 bridge loan notes, the
          Company issued warrants to purchase 250,000 shares of
          common stock at an exercise price of $3.00 per share
          ("the Warrants"), which exercise price was reduced on
          September 11, 1998 to $0.75 per share and was further
          reduced to $0.25 per share on November 19, 1998, as
          further explained below. The Warrants expire on May 15,
          2003.

          Under the covenants of the loan agreements, the Company
          would have been in default on September 15, 1998 and on
          November 19, 1998 because the Company had revenues less
          than required for the quarters ended June 30, 1998 and
          September 30, 1998, respectively. However, the Company
          obtained separate waivers of the default for the quarters
          ended June 30, 1998 and September 30, 1998 from each of
          the holders of the notes. As a condition thereto, the
          Company agreed to increase the interest rate on the notes
          retroactive to May 1998, from 10% to 16%, to change the
          exercise price of each Warrant from $3.00 per share to
          $0.25 per share, to grant the holders of the notes
          additional warrants to purchase 83,333 shares of the
          Company's common stock at an exercise price of $0.25 per
          share, and to use the proceeds of any offering of its
          securities to repay the notes on a pro rata basis
          (excluding any funds provided therein by Lancer Partners
          L.P., Michael Lauer and their affiliates), effective in
          each instance retroactively to May 15, 1998. In addition,
          the holders of the notes agreed to waive any rights under
          the anti-dilution clause under the Warrants arising from
          the offering of the Company's securities, except in the
          case of any securities with an offering price of less
          than $0.25 per share, in which event the exercise price
          of each of the warrants will be changed to such price.


                                   F-12


<PAGE>

          The original Warrants were detachable and had a fair
          value of $867,856, or $3.47 per Warrant on the date
          issued.  The value of the warrants was estimated on the
          date issued using the Black-Scholes option-pricing model.
          The proceeds were allocated to the Warrants based upon
          their fair value and the remainder of the proceeds of
          $1,632,144 were allocated to the notes. Interest expense
          from amortization of the discount on the notes payable
          was $542,408 during the year ended December 31, 1998 and
          $325,448 during the year ended December 31, 1999.
          Interest expense resulting from the modifications of the
          Warrants and from granting additional warrants was
          $331,827 during the year ended December 31, 1998.

          The Company was also in default under the terms of the
          notes at December 31, 1998 and March 31, 1999.  On May
          14, 1999 the Company issued $2,600,000 of senior secured
          16% notes payable which mature in one year. The notes
          were issued for $2,600,000 consisting of $1,600,000 in
          cash and the deemed payment of $1,000,000 of principal of
          the 1998 bridge loan notes. On August 27,  1999, the
          Company issued an additional $480,000 of senior secured
          16% notes payable for cash in the amount of $480,000, and
          on October 11, 1999, the Company issued an additional
          $400,000 of senior secured 16% notes payable for cash in
          the amount of $400,000. The Company paid $155,173 of the
          notes during 1999.

          The notes payable are secured by substantially all the
          Company's assets. Interest on the notes is payable
          quarterly. A mandatory pre-payment of principal equal to
          25% of the gross proceeds from any issuance of the
          Company's securities is due upon the closing of the
          issuance. The terms of the notes state that the notes
          would be in default if the reported loss before interest,
          depreciation, amortization and taxes exceeded $1,000,000
          for the quarter ended June 30, 1999, or if income as
          computed above was less than $250,000 or $1,000,000 for
          the quarters ended September 30, 1999 or December 31,
          1999, respectively. The notes would also be in default if
          the Company failed to make a mandatory pre-payment of
          principal from the issuance of the Company's securities.
          If the notes were determined to be in default for a
          quarter the Company could be required to issue five-year
          warrants to purchase 300,000 shares of common stock at
          $0.25 per share as compensation for the default with
          respect to such quarter.

          The Company was not in compliance with the terms of the
          notes, accordingly, for the quarters ended June 30, and
          September 30, 1999, the Company accrued $279,555 and
          $397,647 of interest expense respectively, for the
          default.  The interest accrual was valued based upon the
          value of the warrants had they been issued on June 30,
          and September 30, 1999, respectively.  The Company also
          issued 200,000 shares of common stock as compensation to
          the holders of the notes as consideration of extending
          the interest payment on the notes to December 31, 1999.
          The Company recognized $512,000 of interest expense for
          the issuance of the 200,000 shares.

          NOTE 7--INCOME TAXES

          The net loss for all periods presented resulted entirely
          from operations within the United States. There was no
          provision for or benefit from income tax for any period.
          The components of the net deferred tax asset are shown
          below:
                                                            1999         1998
                                                       ---------   ----------
               Operating loss carryforwards            $9,439,391  $5,011,372
               Accrued liabilities and other               33,669      92,689
                                                       ----------  ----------
               Total Deferred Tax Assets                9,473,060   5,104,061
               Valuation Allowance                     (9,473,060) (5,104,061)
                                                       ----------- ----------
               Net Deferred Tax Asset                  $         - $        -
                                                       =========== ==========


                                   F-13
<PAGE>

          For tax reporting purposes, the Company has net operating
          loss carryforwards in the amount of $24,630,388 which
          will expire beginning in the year 2012. Of this amount,
          $1,246,871 was from Digital Radio prior to its
          acquisition, and the availability of this amount to
          offset future taxable income is limited.

          The following is a reconciliation of the amount of tax
          (benefit) that would result from applying the federal
          statutory rate to pretax loss with the provision for
          income taxes.

                                              For the Years Ended
                                                  December 31,
                                     -------------------------------------
                                        1999         1998         1997
                                     -----------  -----------  -----------
    Tax at statutory rate (34%)      $(4,190,090) $(5,091,163) $(2,560,277)
    Non-deductible expenses              227,776      604,178      645,880
    Change in valuation allowance      4,368,999    5,299,083    2,301,134
    State tax benefit, net of
     federal tax effect                 (406,685)    (494,142)    (248,497)
    Research and development credit           -      (317,956)    (138,240)
                                     -----------  -----------  -----------
       Net Income Tax Expense        $            $        -   $        -
                                     ===========  ===========  ===========

          In connection with the Digital Radio acquisition in 1997,
          $1,258,000 of research and development was written-off
          before tax. This amount comprises most of the
          non-deductible expenses in 1997. The results of the
          acquisition was an increase to total deferred tax assets
          of $620,647 and a corresponding increase in the valuation
          allowance.

          NOTE 8--SUPPLEMENTAL CASH FLOW INFORMATION AND NONCASH
                   INVESTING AND FINANCING ACTIVITIES

          SUPPLEMENTAL CASH FLOW INFORMATION -


           FOR THE YEARS ENDED DECEMBER 31,


                                         For the Years Ended December 31,
                                         --------------------------------
                                            1999         1998        1997
                                         -------  -----------    --------
               Interest Paid             424,620  $   531,247    $ 34,426

          NONCASH INVESTING AND FINANCING ACTIVITIES -

          The Company acquired equipment and incurred obligations
          under capital lease agreements during 1999 for equipment
          acquired valued at $18,000. Two notes payable totaling
          $800,000 along with $93,698 of accrued interest were
          converted into 893,698 shares of common stock.

          The Company converted $1,000,000 of the 1998 bridge loan
          notes into the 16% senior secured notes payable. In
          addition, $250,000 of the 1998 bridge loan notes were
          converted into mandatorily redeemable preferred stock.
          During 1999, the Company also canceled $8,449 of the
          remaining balance of a note issued to an employee, and
          returned to the employee the equipment previously purchased
          from the employee.

          During 1998, the Company issued stock for notes payable
          to three individuals. The total of the notes receivable
          was $72,852. In conjunction with these notes, interest
          expense in the amount of $10,567 was charged on one of
          these notes. The Company acquired equipment and incurred
          obligations under capital lease agreements during 1998
          for equipment valued at $900,993. The Company also
          purchased equipment for a note in the amount of $4,278.
          During 1998, the Company repurchased stock options from
          employees and eliminated $903,619 of unamortized
          compensation relating to the repurchased unvested stock
          options. The Company also incurred $392,662 in
          compensation expense and $70,518 in unearned compensation
          by issuing stock options during 1998.


                                   F-14
<PAGE>

          The Company sold business assets relating to its
          SecuriKey products during 1998. The Company realized
          proceeds on the sale of $372,499 and recognized a gain of
          $319,528. The Company also sold other assets to various
          parties during the year. The book value of the assets
          sold was $16,940. The Company realized proceeds on the
          sale of $8,636 resulting in a loss upon disposal of $13,223.

          During the year ended December 31, 1997, $1,970 in
          long-term debt was converted into 5,630 shares of common
          stock at $0.35 per share. The Company purchased equipment
          totaling $54,887 by issuing a note payable in the same
          amount. Equipment was sold at no gain or loss in exchange
          for assumption by the purchaser of a $54,320 note
          payable. The Company issued 1,798,100 shares of common
          stock and 201,900 stock options in exchange for all of
          the issued and outstanding common stock of Digital Radio.
          In January and February 1997, which was prior to the
          effective date of the merger, the Company advanced
          $118,764 to Digital Radio. In conjunction with the
          merger, liabilities were assumed as follows:

          Fair value of assets acquired         $ 1,112,399
          Purchased research and development      1,258,000
          Goodwill                                7,885,075
          Common stock issued and stock options
           granted                               (8,674,062)
                                                 ----------
          Liabilities Assumed                    $1,581,412
                                                 ==========


          NOTE 9--MANDATORILY REDEEMABLE PREFERRED STOCK AND WARRANTS

          On May 14, 1999 the Company authorized 950 shares of
          senior liquidating mandatorily redeemable 10% preferred
          stock with a liquidation preference of $1,000 per share
          and detachable five-year warrants to purchase up to
          4,750,000 common shares at $0.25 per share, and issued
          950 shares of preferred stock and the related warrants
          between May 15, 1999 and October 5, 1999. The preferred
          shares must be redeemed within one year at their par
          value plus accrued dividends. The preferred stock cash
          dividend requirement is $95,000 annually.  The preferred
          stock was issued for proceeds of  $950,000 consisting of
          $700,000 cash  and the deemed payment of $250,000 of
          principal of the 1998 bridge loan notes. The issuance of
          the preferred stock with warrants was accounted for as
          the granting of a favorable conversion feature to the
          preferred stock holders. The value assigned to the
          warrants was based on their intrinsic value but limited
          to the cash proceeds and the amount of the deemed
          principal payments on the 1998 bridge loan notes.  Since
          the warrants were immediately exercisable, the resulting
          discount to the preferred stock of $950,000 was
          recognized as preferred dividends on the dates the
          preferred shares were issued. Preferred dividends in the
          amount of $50,658 were accrued but unpaid at December 31,
          1999.

          The Mandatorily Redeemable Preferred Stock constitutes the senior
          series of any preferred stock the Company may issue and has
          a first priority in liquidation of $1,000 per share, plus the
          amount of unpaid cumulative dividends after payment of all
          claims to creditors. The preferred shares are non-voting and have
          a 10% cumulative dividend, and are mandatorily redeemable upon
          the earlier of May 14, 2000 or the Company's raising of gross
          proceeds of $5,500,000 from the closing of one or more private
          placement transactions or secondary offerings of its securities.
          The preferred stock is convertible into shares of the Company's
          common stock at the conversion rate of 1,000 shares of common
          stock for each share of Mandatorily Redeemable Preferred Stock,
          or $0.10 per share if all the shares the Company's preferred
          stock are not redeemed by May 14, 2000 based on the 950 shares of
          the Company's preferred stock which are issued and outstanding.

          NOTE 10--STOCKHOLDERS' EQUITY

          The Company issued 2,557,857 shares of common stock from
          January 1997 through August 1997 in private placement
          offerings for $4,195,250 cash.  During 1997, the Company
          issued 25,098 shares of common stock upon the exercise of
          stock options. Proceeds from the issuance were $11,452 of
          cash and a promissory note from a shareholder of $18,409.

          On November 11, 1997, the Company fulfilled an obligation
          totaling $323,456 under a settlement reached with an
          otherwise unrelated joint venture partner. The obligation
          was settled by the Company issuing 40,000 shares of
          restricted common stock valued at $8.09 per share based
          upon fair value of the common stock on the date issued.
          Under the settlement agreement, the shareholder has an
          option to require the Company to redeem the stock at
          $4.00 per share through February 28, 1998, but the option
          was not exercised by that date and it expired. During
          November and December 1997, the Company issued 24,375
          shares of common stock for financing fees in the amount
          of $253,137.

                                   F-15

<PAGE>


          During 1998, the Company issued 502,000 restricted common
          shares in a private placement to the major shareholders
          of the Company for cash in the amount of $907,767, net of
          $96,233 in accumulated offering costs, or $2.00 per share
          before offering costs. There were no unstated rights or
          privileges received with respect to this issuance. The
          Company issued 2,219,258 shares of common stock from
          October 1998 through December 1998 in private placement
          offerings for $1,436,047.

          The Company issued 10,000 common shares in conjunction
          with the execution of a manufacturing contract during
          February 1998. The shares were valued at $75,000 or $7.50
          per share, which was the quoted market trading price on
          the date of issuance and was considered a preliminary
          cost of obtaining the contract. The cost will be
          amortized over the fulfillment of the contract. The
          Company also issued 234,283 shares of common stock for
          legal and consulting services. An additional 199,546
          shares were issued as finders fees and commissions.

          In May 1998, the Company acquired proprietary
          intellectual property rights in and to spread spectrum
          radio technology which has been accounted for as
          purchased research and development. The acquisition of
          this technology provides the Company with the ability to
          modify and update the technology for use in its radio
          products and engineering contracts. The purchase price
          was $305,651, of which $300,000 was paid by the issuance
          of 60,000 common shares valued at $5.00 per share, with
          the balance being paid in cash for closing and related
          costs. Additionally, the Company loaned $66,975 to the
          seller, $41,975 therefore, was paid in cash and carries
          interest at 10%. The balance of $25,000 was advanced
          through the issuance of 5,000 common shares, valued at
          $5.00 per share, to two creditors of the seller. The
          seller executed an unsecured promissory note which is due
          the earlier of the date of registration by the Company of
          the 60,000 shares of common stock or June 22, 1999.

          During 1998, the Company issued 435,051 shares of common
          stock upon the exercise of stock options. Proceeds from
          the issuance were $143,323 and a promissory note from a
          shareholder of $48,419. $10,000 of the note has been
          received and the Company has charged the shareholder
          interest of $10,567 on the note.

          In November 1998, the Company converted $15,123 of
          interest to 30,000 shares of common stock. This interest
          was converted to shares at a rate that was below the
          market value for the stock. An additional $24,267 of
          interest expense was recognized on the conversion of the
          interest. In association with the bridge loans discussed
          in Note 5, $867,856 of interest expense was recognized
          and recorded as additional paid-in capital. As a result
          of being in default on the bridge loans, additional
          warrants were issued and the existing warrants were
          repriced. This resulted in an additional $184,720 of
          interest that was recognized as additional paid-in
          capital. The total amount of interest expense that was
          recorded as additional paid-in capital is $1,091,966.

          During February 1999, the Company issued 2,040,000 common
          shares for cash in the amount of $2,040,000 received in a
          private placement offering. In connection with the
          offering, the Company granted options to purchase 200,000
          common shares at $1.75 per share within 5 years and
          issued 8,000 shares of common stock as a finder's fee.
          The Company paid $163,200 as a finder's fee in connection
          with the private placement. The Company issued 3,538,000
          common shares for cash in the amount of $3,538,000
          received in other various private placement offerings
          throughout the year. In connection with the offerings,
          the Company paid $390,527 and issued 26,000 shares of
          common stock as finders' fees.


                                   F-16
<PAGE>

          During March 1999, note  holders converted two unsecured
          promissory notes totaling $800,000, together with accrued
          interest, into 893,698 common shares at $1.00 per share
          under the terms of a conversion privilege granted to the
          note holders in December 1998.  At the date of the
          conversion, the Company recognized a beneficial
          conversion feature of $81,517 relating to the conversion
          of accrued interest into common stock at a favorable
          conversion rate.


          During 1999, the Company issued 120,841 restricted common
          shares for services valued at $231,386, or $1.91 per
          share.

          During 1999, the Company issued 253,077 common shares
          upon exercise of warrants for cash in the amount of
          $63,269 or $0.25 per share and, during August 1999, the
          Company issued 250,000 common shares to holders of bridge
          loan notes in satisfaction of the Company's default on
          the notes.  The value of the shares issued on the default
          of the bridge loan was $250,000, or $1.00 per share.
          During November 1999, the Company defaulted on its
          obligation to pay interest on the 16% senior secured
          notes. The Company issued 200,000 shares of common stock
          in satisfaction of the default and the interest payment.
          The stock was valued at $512,000 or $2.56 per share.

          During 1999, Company issued warrants to the holders of
          the 16% senior secured loan notes as satisfaction of
          defaults on the notes. The Company issued 300,000
          warrants on June 30 and again on September 30, 1999, and
          recognized $279,555, and $397,647 of interest expense,
          respectively, from the issuance of the warrants.

          During April 1999, the Company granted warrants to
          purchase 100,000 shares of common stock to the holders of
          the 1998 bridge loan notes.  The Company recognized
          $170,774 of interest expense from the issuance of the
          warrants. Also, on October 1, 1999, the Company granted
          warrants to purchase 398,000 shares of common stock  to two
          shareholders for services to the Company.  The Company
          recognized an expense relating to these services of $425,155
          at the date of the grant.

          NOTE 11--STOCK OPTIONS

          The Company has granted stock options under stock option
          plans and has granted other individual options to
          employees and directors.

          Under the 1997 Stock Option Plan (the 1997 Plan), options
          to purchase a maximum of 1,500,000 common shares were
          authorized for issuance to officers and employees.
          Options to purchase 937,044 common shares were granted
          under the 1997 Plan on December 18, 1997 with a
          weighted-average exercise price of $6.50 per share. The
          options become exercisable from the date granted through
          November 10, 1999. The unexercised options were to expire
          on December 17, 2002. Compensation relating to the
          options of $2,108,349, or $2.25 per share, was to be
          recognized over the period the options vest, of which
          $697,840 was recognized during the fourth quarter of
          1997. In April 1998, the Board of Directors approved the
          repurchase of 638,236 unvested options under the 1997
          Plan for $6,382, or $0.01 per share. The Company
          recognized compensation expense relating to these options
          of $506,890 during 1998. The remaining unearned
          compensation relative to the options repurchased was
          eliminated.

          The Company adopted the 1998 Employee Incentive Stock
          Option Plan and the 1998 Non-Qualified Stock Option Plan
          during December 1998.  The plans were ratified by the
          shareholders in April 1999. Options to purchase up to
          2,000,000 common shares are authorized under the terms of
          the plans. Options under the plans may be granted to key
          employees of the Company including officers, directors
          and employees. Options granted under the 1998 Employee
          Incentive Stock Option Plan are exercisable at the fair
          value of the common stock on the date granted (110% of
          fair value if granted to a shareholder who owns 10% or
          more of the total combined voting power of all classes of
          stock of the Company). Options may be exercised by
          payment of cash or by shares of common stock of the
          Company.  Options granted under the plans are generally
          exercisable over three to five years and expire five
          years from the date of grant.


                                   F-17
<PAGE>

          During 1999, the Company granted 30,000 5-year and 30,000
          4-year options to purchase 60,000 shares of common stock
          at $1.94 and $2.04 per share, respectively to Directors.
          The options were valued according to their fair value,
          which was $96,214 on the date of the grant. Compensation
          expense of $51,532 was recognized on the issuance of the
          options and $44,682 will be recognized over the remaining
          vesting period of the options. The Company also issued
          150,000 warrants to purchase common stock to holders of
          the bridge loan notes for services rendered.  Interest
          expense of $130,385 was recognized on the issuance of the
          warrants.

          A summary of the status of the Company's stock options as
          of December 31, 1999, 1998 and 1997, and changes during
          the years then ended are presented below:
<TABLE>
<CAPTION>

                                          1999                 1998                   1997
                                   ------------------  --------------------- --------------------
                                             Weighted               Weighted             Weighted
                                              Average                Average              Average
                                             Exercise               Exercise             Exercise
                                   Shares      Price      Shares      Price     Shares     Price
                                 ---------   --------- ------------  ------- -----------   ------

<S>                              <C>         <C>       <C>            <C>    <C>           <C>
Outstanding at beginning Of year    641,922     $ 4.22    1,521,846   $ 4.33     258,000   $ 0.33
Granted                             837,000       1.98      595,678     5.03   1,288,944     5.06
Exercised                                 -          -     (435,051)    0.44     (25,098)    1.19
Forfeited or canceled              (458,272)      3.08   (1,040,551)    6.32           -        -
                                 ----------             -----------           ----------
Outstanding at end of year        1,020,650       2.89      641,922     4.22   1,521,846     4.33
                                 ==========             ===========           ==========
Options exercisable at
 year-end                           352,649       4.52      417,900     4.60     792,610     2.32
                                 ==========             ===========           ==========
Weighted-average fair value
 of options granted during
 the year                        $     1.55             $      3.86           $     3.43
                                 ==========             ===========           ==========

</TABLE)

The following table summarizes information about stock options outstanding at
December 31, 1999:

                        Options Outstanding           Options Exercisable
                  -----------------------------------  ----------------
                                             Weighted-         Weighted-
                               Average       Average           Average
   Range of                  Contractual     Exercise          Exercise
    Prices          Shares       Life          Price    Shares   Price
--------------    ---------   ----------     --------  ------- -------
$ 1.25 - $1.94      222,000   1.95 years     $   1.65  113,999 $  1.58
$ 2.09 - $2.09      560,000   1.86 years         2.09        -       -
$ 3.40 - $3.50       80,650   1.74 years         3.43   80,650    3.43
$ 6.50 - $6.50      138,000   2.22 years         6.50  138,000    6.50
$12.00 -$12.00       20,000   3.04 years        12.00   20,000   12.00
                  ---------                           --------
$1.25 - $12.00     1,020,650  1.94 years         2.89  352,649    4.52
                  ==========                          ========

          The Company measures compensation under
          stock-based options and plans using the
          intrinsic value method prescribed in Accounting
          Principles Board Opinion 25, Accounting for
          Stock Issued to Employees, and related
          interpretations, for stock options granted to
          employees, and determines compensation cost
          granted to non-employees based on the fair
          value at the grant dates consistent with the
          alternative method set forth under Statement of
          Financial Accounting Standards No. 123, (SFAS
          123)  Accounting for Stock-Based Compensation.
          Stock-based compensation charged to operations
          was $108,612, $899,553 and $963,340 for the
          years ended December 31, 1999, 1998 and 1997,
          respectively. Had compensation cost for the
          Company's options been determined based upon
          SFAS 123, net loss and loss per share would
          have increased to the pro forma amounts
          indicated below:

                                   F-18


<PAGE>
                                  For the Years Ended December 31,
                              -----------------------------------------
                                      1999           1998          1997
                              ------------   ------------   -----------
     Net loss:
          As reported         $(12,323,795)  $(15,332,635)  $(7,809,490)
          Pro forma            (12,766,433)   (17,506,009)   (8,060,504)
     Basic and diluted loss
      per common share:
          As reported         $     (0.77)   $      (1.34)  $     (0.85)
          Pro forma                 (0.80)          (1.56)        (0.87)


The fair value of each option granted was estimated on the date of grant
using the Black-Scholes option-pricing model with the following weighted-
average assumptions used for grants in 1999, 1998, and 1997, respectively:
dividend yield of 0.0% for all years; expected volatility of 166%, 105%,
and 79%; risk-free interest rate of 5.6%, 5.2%, and 5.3%; and
expected lives of the options of 2.0 years, 4.1 years, and 2.0 years.


NOTE 12--STOCK WARRANTS

During 1998, the Company issued warrants to purchase 250,000 common
shares of stock  at $3.00 per share to holders of the 1998 bridge
loan notes. The warrants were subsequently repriced to $0.25
per share. An additional 83,333 warrants were issued to the
note holders during 1998.  The value of the warrants was estimated
on the dates issued and on the dates the warrants were modified using
the Black-Scholes option-pricing model. The Company recognized $1,199,683
of interest expense on the issuance and repricing of the warrants. In
addition, the Company issued 398,000 warrants to purchase common shares at
$1.75 to $5.00 per share as financing fees in connection with the issuance
of the 1998 bridge loan notes.  Interest expense of $425,155 was
recognized on the issuance of the warrants.

During 1999, the Company issued warrants to purchase 4,750,000 shares of
common stock to the purchasers of the Company's preferred stock. The warrants
were valued at  $950,000.

The Company issued warrants to purchase 1,050,000 common shares to the holders
of the 1998 bridge loan notes and the 16% senior secured notes as satisfaction
for the potential defaults on the notes throughout 1999. The Company recognized
$1,313,195 of interest for the warrants issued.

During the year ended December 31, 1999, 253,077 warrants were exercised
for services rendered to the Company valued at $63,269 or $0.25 per share.
At December 31, 1999, the Company had warrants outstanding to purchase
6,678,260 shares of common stock.

NOTE 13--RELATED PARTY TRANSACTIONS

During 1999, the Company paid $9,857 in cash on  a note payable to an employee
of the Company. The employee voluntarily repossessed the equipment in exchange
for the remaining $8,449 of the note payable from the Company. The equipment
had a book value of $16,507 at the time of disposition; the Company recorded a
loss of $8,058 on the return of the equipment to the employee.

During 1998, the Company paid outstanding loans to shareholders. The amount
paid on these loans totaled $369,807. In addition, a shareholder and an employee
of the Company made a short-term loan to the Company for $40,000.
This loan was also repaid in 1998.

During 1997, an officer and shareholder loaned $125,000 to the Company.
The loan carried a 12% interest rate and was due on December 31, 1997.
The Company issued 9,375 shares of common stock valued at $98,938 as a fee
relating to the loan. Two loans to the Company of $400,000 were
guaranteed and secured by common stock held by an officer. Through the
acquisition of Digital Radio, the Company assumed and subsequently
paid a note payable and accrued wages totaling $128,057 to two officers
and shareholders.

                                   F-19
<PAGE>

NOTE 14--COMMITMENTS AND CONTINGENCIES

LEASE COMMITMENTS - The Company leases office and production facilities
under agreements accounted for as operating leases. Lease expense attributable
to the years ended December 31, 1999 and 1998 was $342,051 and $483,456,
respectively. Lease expense recognized during 1999 for abandonment of
property with a non-cancelable lease with a Lease term ending in August 2005,
was $1,756,924. During 1999 the Company entered into an agreement to lease
new facilities in connection with their new location in Denver with the lease
term ending October 2004.  The Company also leases engineering and office
equipment under capital leases with interest Rates from 8 to 24 percent,
with a weighted average interest rate of 10.16%.  The following is a schedule
by years of the future minimum lease payments required under operating and
capital leases together with the present value Of net minimum lease payments
as of December 31,1999:


   Years Ending December 31,:         Leases             Leases
   --------------------------        -------           ---------
          2000                        132,084             489,214
          2001                         10,960             439,776
          2002                         5,076             445,180
          2003                          5,076             457,035
          2004                            423             445,538
          Thereafter                        -             194,195
                                     --------          ----------

          Total Minimum Lease
            Payments                  153,619          $2,470,938
                                                       ==========
Less amount representing interest      12,934
                                     --------
Present Value of Net Minimum Lease
 Payments                             140,685
Less Current Portion                  119,226
                                    ---------
Long-Term Obligations Under Capital
 Lease                              $  21,459
                                    =========

The amortization of the capital leases has been included in depreciation
expense.

Several capital leases exist for office equipment and telephone equipment and
a several capital leases for office equipment were paid in full during 1999.
The following presents the cost and accumulated depreciation of property
under capital leases by major classes:



          Telephone Equipment                $ 15,897       $ 15,897
          Office equipment                    389,184        371,184
                                             --------       --------
                                              405,081        387,081
          Less accumulated depreciation       274,454        127,745
                                             --------       --------
          Net Carrying Value                 $130,627       $259,336
                                             ========       ========

SETTLEMENT OF LEGAL CLAIMS - During 1999 The Company settled a claim from a
software vendor for a $100,000 cash payment. The claim arose when the Company
returned leased software and requested cancellation of the lease and technical
support agreement. During 1999, the Company also settled a lawsuit brought by
an investment banker and paid $145,000 as settlement expense.

UNASSERTED CLAIMS - The Company received an oral request in 1998 from Mr. and
Mrs. Richard Austin to rescind the Company's purchase of the assets of Austin
Antenna Ltd., which closed in 1998. In addition, Mr. Austin requested that
the Company bear the cost of (I) the legal fees and expenses in a litigation
commenced against Mr. Austin in a state court in Massachusetts seeking damages
for non-payment of commissions arising out of the Company's purchase of Austin
Antenna Ltd. and (ii) an unpaid finder's fee that is the subject of the
Massachusetts' litigation. The Company, in turn, has advised Mr. and Mrs.
Austin that Austin Antenna Ltd. has breached its agreement with the Company. It

                                   F-21
<PAGE>

appears Mr. Austin has reached  a settlement with respect to the action against
him. Although the Company believes that its claim against Austin Antenna Ltd.
and the claims of Mr. and Mrs. Austin will be amicably resolved,
There can be no assurance as to the outcome thereof.

Williams Wireless, Inc. raised a claim in 1999 that the Company violated the
non-competition provisions of their agreements by allegedly marketing X-traWeb
products in the telemetry and meter reading applications. The Company, in
turn, claimed that Williams Wireless, Inc. failed to satisfy all of its duties
under its various agreements with the Company. While the Company believes that
Williams' claims are properly disputable, the parties agreed orally To enter
into a settlement agreement and mutual release. While Williams Wireless,
Inc. paid the sum due under the draft settlement agreement to the Company and
the Company delivered to Williams Wireless, Inc. all inventory of products for
which it made payment to the Company, the settlement agreement has not yet
been signed. Under the draft agreement, the Company had agreed also to grant
Williams Wireless, Inc. a perpetual non-exclusive royalty-free license to use
one of the Company's radios as a component in the Williams' telemetry systems
or products. In the Interim, the Company believes that an unrelated party
acquired the assets or stock of Williams Wireless, Inc. While the Company
expects that such settlement agreement will be signed by such new owner in the
foreseeable future, there can be no assurance of such result.

401K PROFIT SHARING PLAN -The Company sponsors a  401K profit sharing plan but
has no commitment to match employees' contributions to the plan, nor has the
Company made any contributions to the plan to date.


NOTE 15--SUBSEQUENT EVENTS

Subsequent to December 31, 1999, the Company issued 4,548,667 shares of common
stock in a private placement for cash proceeds of $13,646,000. The Company
also paid finders fees of $42,800 in connection with the private placement.
During March 2000, the Company paid off the 1999 bridge loans in existence at
December 31, 1999, with cash in the amount of $2,377,623 and by the exercising
of stock Warrants to purchase 3,788,813 shares at $0.25 per share. The total
amount of the 1999 bridge loans paid by the exercise of the warrants was
$947,204.  In addition, the Company issued 273,077 common shares upon the
exercise of warrants in the amount of $67,986, or $0.25 per  share.

On February 25, 2000, the Company redeemed the mandatorily redeemable
preferred stock for cash of $950,000 for the principal balance and
$57,378 for the preferred dividends accrued to date.

During March 2000, the Company issued 16,474 shares of common stock upon
the cashless exercise of 18,333 options (uaudited).


                                   F-21
<PAGE>



</TABLE>