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

                                  UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                              WASHINGTON, DC 20549

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

                                   FORM 10-QSB


( X ) QUARTERLY REPORT                                     ( ) TRANSITION REPORT


                         PURSUANT TO SECTION 13 OR 15(D)
                     OF THE SECURITIES EXCHANGE ACT OF 1934


For the Quarterly Period Ended                   Commission File No. 33-20015-NY
     September 30, 1998

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

                             SENTECH EAS CORPORATION
             (Exact name of Registrant as specified in its charter)


          FLORIDA                                      65-0734041
(State or other jurisdiction                         (I.R.S. Employer 
of incorporation or organization)                 Identification Number)

      484 SOUTHWEST 12TH AVENUE
      DEERFIELD BEACH, FLORIDA                             33442-3108
(Address of principal executive offices)                   (Zip Code)


         Registrant's telephone number including area code: 954-426-2965


               Former name, former address and former fiscal year,
                       if changed since last report: SAME


Indicate by check mark whether the Registrant (1) has filed all reports required
to be filed by Sections 13 or 15(d) of the Securities Exchange Act of 1934
during the preceding 12 months (or for such shorter period that the Registrant
was required to file such reports), and (2) has been subject to such filing
requirements for the past 90 days. Yes     No X
                                      ---    ---

As of October 31, 1998, there were 1,677,201 shares of the common stock
outstanding.

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




<PAGE>


                             SENTECH EAS CORPORATION

                                      INDEX

                                   FORM 10-QSB

                      NINE MONTHS ENDED SEPTEMBER 30, 1998




PART I.    FINANCIAL INFORMATION

     Item 1.    Financial Statements

                  Consolidated Balance Sheets                                 2

                  Consolidated Statements of Operations                       3

                  Consolidated Statement of Shareholders' Equity              4

                  Consolidated Statements of Cash Flows                       5

                  Notes to Consolidated Financial Statements                  6

     Item 2.    Management's Discussion and Analysis of 
                Financial Conditionand Results of Operations                  8




PART II. OTHER INFORMATION

     Item 1.    Legal Proceedings                                            11

     Item 4.    Submission of Matters to a Vote of Security Holders          11

     Item 5.    Other Information                                            11

     Item 6.    Exhibits and Reports on Form 8-K                             12

     Signatures                                                              12










<PAGE>


                             SENTECH EAS CORPORATION
                           CONSOLIDATED BALANCE SHEETS


<TABLE>
<CAPTION>


                                                                 SEPTEMBER 30,
                                                                      1998       DECEMBER 31,
                                                                  (UNAUDITED)        1997
                                                                -----------------------------
ASSETS
------------------------------------------------------------

<S>                                                            <C>            <C>    
Current assets
     Cash and cash equivalents                                  $   275,286    $   475,263
     Accounts receivable, net of allowances of $5,000               132,973        199,802
     Inventories                                                    464,229        531,197
     Other current assets                                            81,924         62,150
                                                                -----------    -----------
        Total current assets                                        954,412      1,268,412
Property and equipment, net                                          36,747         50,916
Other assets                                                        127,457         96,407
                                                                -----------    -----------

                                                                $ 1,118,616    $ 1,415,735
                                                                ===========    ===========

LIABILITIES AND SHAREHOLDERS' EQUITY
------------------------------------------------------------

Current liabilities
     Accounts payable                                           $   126,103    $   390,759
     Accrued liabilities                                             98,285         63,051
     Current maturities of long-term debt                              --           16,657
                                                                -----------    -----------
         Total current liabilities                                  224,388        470,467
                                                                -----------    -----------
Long-term debt less current maturities                              203,000        203,000
                                                                -----------    -----------


Shareholders' equity
     Common stock; $0.00024 par value; 20,833,333 authorized;
        1,677,201 and 1,640,427 issued and outstanding                  403            394
     Additional capital                                           2,470,683      2,444,054
     Accumulated deficit                                         (1,779,858)    (1,702,180)
                                                                -----------    -----------
         Total shareholders' equity                                 691,228        742,268
                                                                -----------    -----------

                                                                $ 1,118,616    $ 1,415,735
                                                                ===========    ===========

</TABLE>

------------------------------------------------------------
SEE ACCOMPANYING NOTES TO CONSOLIDATED FINANCIAL STATEMENTS.


                                       2



<PAGE>


                             SENTECH EAS CORPORATION
                      CONSOLIDATED STATEMENTS OF OPERATIONS
                                   (UNAUDITED)
<TABLE>
<CAPTION>



                                                    THREE MONTHS ENDED               NINE MONTHS ENDED
                                                       SEPTEMBER 30,                   SEPTEMBER 30,
                                                    1998           1997            1998          1997
---------------------------------------------   ------------   -----------    -----------    -------------

<S>                                             <C>            <C>            <C>            <C>        
Revenues                                        $   407,467    $   714,496    $ 1,624,147    $ 1,334,116
Cost of revenues                                   (220,080)      (462,872)    (1,016,916)      (856,191)
                                                -----------    -----------    -----------    -----------
Gross profit                                        187,387        251,624        607,231        477,925
Selling, general, and administrative expenses      (213,175)      (196,183)      (689,082)      (560,105)
                                                -----------    -----------    -----------    -----------
Operating (loss)/income                             (25,788)        55,441        (81,851)       (82,180)
Interest expense                                     (1,069)        (1,898)        (3,389)        (6,714)
Interest income                                       4,263          2,864          7,562         10,996
                                                -----------    -----------    -----------    -----------
Net (loss)/income                               $   (22,594)   $    56,407    $   (77,678)   $   (77,898)
                                                ===========    ===========    ===========    ===========
Net (loss)/income per share                     $     (0.02)   $      0.04    $     (0.05)   $     (0.05)
                                                ===========    ===========    ===========    ===========                            
                                                                           
</TABLE>


------------------------------------------------------------
SEE ACCOMPANYING NOTES TO CONSOLIDATED FINANCIAL STATEMENTS.


                                       3


<PAGE>


                             SENTECH EAS CORPORATION
                 CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY



<TABLE>
<CAPTION>


                                                    COMMON STOCK         ADDITIONAL     ACCUMULATED
                                                --------------------
                                                   SHARES    AMOUNT       CAPITAL        DEFICIT        TOTAL
                                                ---------  ---------  -------------  -------------- ------------

<S>                                            <C>         <C>       <C>            <C>            <C>        
BALANCE AT DECEMBER 31, 1997                    1,640,427   $   394   $ 2,444,054    $(1,702,180)   $   742,268

Conversion of debt interest                           891         1         2,137           --            2,138

Issued in lieu of payment for  professional         5,883         1        13,999           --           14,000
services

Issued pursuant to compensation agreements         30,000         7        10,493           --           10,500

Net loss                                             --        --            --          (77,678)       (77,678)

                                              -----------   --------  -----------    -----------    -----------
BALANCE AT SEPTEMBER 30, 1998 
(UNAUDITED)                                     1,677,201   $   403   $ 2,470,683    $(1,779,858)   $   691,228
                                              ===========   =======   ===========    ===========    ===========

</TABLE>

------------------------------------------------------------
SEE ACCOMPANYING NOTES TO CONSOLIDATED FINANCIAL STATEMENTS.


                                       4


<PAGE>


                             SENTECH EAS CORPORATION
                      CONSOLIDATED STATEMENTS OF CASH FLOWS
                                   (UNAUDITED)
<TABLE>
<CAPTION>


                                                                           NINE MONTHS ENDED
                                                                             SEPTEMBER 30,
                                                                         1998        1997
-------------------------------------------------------------------- -----------  ----------

CASH FLOWS FROM OPERATING ACTIVITIES:
<S>                                                                  <C>          <C>       
   Net loss                                                          $ (77,678)   $ (77,898)
   Adjustments to reconcile net loss to net cash used in operating
   activities:
       Depreciation and amortization                                    15,552       18,364
       Debt interest converted to common stock                           2,138        4,325
       Stock issued in lieu of payment for professional services        14,000         --
       Stock based compensation                                         10,500         --
       Net changes in operating assets and liabilities:
               Accounts receivable                                      66,829       25,130
               Inventories                                              66,968     (109,705)
               Other current assets                                    (19,774)    (180,289)
               Other assets                                            (31,050)     (58,333)
               Accounts payable                                       (264,656)     117,451
               Accrued liabilities                                      35,234       32,521
                                                                     ---------    ---------
       Net cash used in operating activities                          (181,937)    (228,434)
                                                                     ---------    ---------
CASH FLOWS FROM INVESTING ACTIVITIES:
   Capital expenditures                                                 (1,383)      (4,128)
                                                                     ---------    ---------
CASH FLOWS FROM FINANCING ACTIVITIES:
    Payments on note payable to bank                                   (16,657)     (45,542)
    Payments on notes payable to shareholders                             --        (17,500)
    Net proceeds from issuance of common stock                            --        190,366
                                                                     ---------    ---------
         Net cash (used in) provided by financing activities           (16,657)     127,324
                                                                     ---------    ---------
Net decrease in cash and cash equivalents                             (199,977)    (105,238)
Cash and cash equivalents at beginning of year                         475,263      567,212
                                                                     ---------    ---------
Cash and cash equivalents at end of quarter                          $ 275,286    $ 461,974
                                                                     =========    =========

</TABLE>

------------------------------------------------------------
SEE ACCOMPANYING NOTES TO CONSOLIDATED FINANCIAL STATEMENTS.


<PAGE>


                             SENTECH EAS CORPORATION
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                   (UNAUDITED)


1.   BASIS OF PRESENTATION

     The consolidated financial statements include the financial statements of
     SenTech EAS Corporation and its wholly owned subsidiary, SenTech EAS
     International, Inc., (collectively, the "Company"). All significant
     intercompany balances and transactions have been eliminated in
     consolidation.

     The interim consolidated financial statements presented have been prepared
     by the Company without audit and, in the opinion of the management, reflect
     all adjustments of a normal recurring nature necessary for a fair statement
     of (a) the results of operations for each of the three and nine months
     ended September 30, 1998 and September 30, 1997, (b) the financial position
     at September 30, 1998, and (c) the cash flows for the nine months ended
     September 30, 1998 and September 30, 1997. Interim results are not
     necessarily indicative of results for a full year.

     The consolidated balance sheet presented as of December 31, 1997 has been
     derived from the consolidated financial statements that have been audited
     by the Company's independent public accountants. The consolidated financial
     statements and notes are condensed as permitted by Form 10-QSB and do not
     contain certain information included in the annual financial statements and
     notes of the Company. The consolidated financial statements and notes
     included herein should be read in conjunction with the financial statements
     and notes included in the Company's Annual Report on Form 10-KSB.

2. INVENTORIES

     Inventories consisted of the following:

                                SEPTEMBER 30,
                                   1998         DECEMBER 31,
                               (UNAUDITED)         1997
                               --------------  -------------

     Raw materials                 $ 316,529     $ 339,015
     Finished goods                  147,700       192,182
                                   ---------     ---------
                                   $ 464,229     $ 531,197
                                   =========     =========

     Inventories are stated at the lower of cost or market. Cost is determined
     using the first-in, first-out method.

3.   NET (LOSS)/INCOME PER SHARE

     Net (loss)/income per share is calculated using the weighted average number
     of common shares and dilutive potential common stock outstanding during the
     year. The number of shares used in the per share computations were
     1,677,201 and 1,542,927 for the three months ended September 30, 1998 and
     1997, respectively; and 1,656,624 and 1,528,302 for the nine months ended
     September 30, 1998 and 1997, respectively. Potential common stock, when
     included in the computation of dilutive earnings per share, was
     anti-dilutive at September 30, 1998 and 1997.


                                       6

<PAGE>




     In February 1997, the Financial Accounting Standards Board issued Statement
     of Financial Accounting Standards No. 128 "Earnings Per Share" and
     Statement of Financial Accounting Standards No. 129 "Disclosure of
     Information about Capital Structure" which are both effective for fiscal
     years beginning after December 15, 1997. SFAS No. 128 simplifies the
     current required calculation of earnings per share ("EPS") under APB No.
     15, "Earnings per Share", by replacing the existing calculation of primary
     EPS with a basic EPS calculation. It requires a dual presentation for
     complex capital structures of basic and diluted EPS on the face of the
     income statement and requires a reconciliation of basic EPS factors to
     diluted EPS factors. SFAS No. 129 requires disclosure of the Company's
     capital structure. There was no material impact to the Company's financial
     reporting or presentation due to the adoption of SFAS No. 128 and SFAS No.
     129.

4.   SUPPLEMENTAL CASH FLOW INFORMATION

     The Company paid cash for interest of approximately $0 and $200 for the
     three and nine months ended September 30, 1998 and $1,000 and $3,500 for
     the three and nine months ended September 30, 1997, respectively.

     The Company paid no cash for income taxes for the three and nine months
     ended September 30, 1998 and 1997.

5.   RECENT PRONOUNCEMENTS IN ACCOUNTING STANDARDS

     In June 1997, the Financial Accounting Standards Board issued Statement of
     Financial Accounting Standards No. 130 "Reporting Comprehensive Income"
     which is effective for fiscal years beginning after December 15, 1997. SFAS
     No. 130 establishes standards for the reporting and display of
     comprehensive income and its components in a full set of general purpose
     financial statements which requires the Company to (i) classify items of
     other comprehensive income by their nature in a financial statement and
     (ii) display the accumulated balance of other comprehensive income
     separately from retained earnings and additional paid-in-capital in the
     equity section of the balance sheet. There was no material impact to the
     Company's financial reporting or presentation due to the adoption of SFAS
     No. 130.

     Also in June 1997, the Financial Accounting Standards Board issued
     Statement of Financial Accounting Standards No. 131 "Disclosures about
     Segments of an Enterprise and Related Information" which is effective for
     fiscal years beginning after December 15, 1997. SFAS No. 131 supersedes
     SFAS No. 14, "Financial Reporting for Segments of a Business Enterprise",
     and amends SFAS No. 94, "Consolidation of All Majority-Owned Subsidiaries".
     SFAS No. 131 requires annual financial statements to disclose information
     about products and services, geographic areas, and major customers based on
     a management approach, along with interim reports. The management approach
     requires disclosing financial and descriptive information about an
     enterprise's reportable operating segments based on reporting information
     the way management organizes the segments for making business decisions and
     assessing performance. It also eliminates the requirement to disclose
     additional information about subsidiaries that were not consolidated. This
     new management approach may result in more information being disclosed than
     presently practiced and require new interim information not previously
     presented. There was no material impact to the Company's financial
     reporting or presentation due to the adoption of SFAS No. 131.

     In February 1998, the Financial Accounting Standards Board issued Statement
     of Financial Accounting Standards No. 132 "Employers' Disclosures About
     Pensions and Other Postretirement Benefits-an amendment of FASB Statements
     No. 87, 88, and 106" which is effective for fiscal years beginning after
     December 15, 1997. SFAS No. 132 revises only the employers' disclosures
     about pension and other postretirement benefit plans; it does not change
     the measurement or recognition of such plans. Since the Company does not
     have such plans, there is no impact to the Company's financial reporting or
     presentation due to the adoption of SFAS No. 132.


                                       7


<PAGE>

6.   PURCHASE AND MANUFACTURING AGREEMENT

     In June 1997, the Company entered into a three year purchase and
     manufacturing agreement (the "Agreement") with a company whose President
     and Chief Executive Officer is a director of the Company. The Agreement, as
     amended, provides for the development and manufacture of the Company's
     third generation EAS system. The Agreement requires the Company to pay
     $187,000 of non-recurring engineering costs in exchange for an assignment
     of fifty percent of the joint technology as defined by the Agreement.
     Payments made for non-recurring engineering are recorded at cost and are
     amortized as a component of cost of revenues using the units-of-production
     method. As of September 30, 1998, approximately $152,000 of non-recurring
     engineering costs were capitalized of which $31,000 and $119,000 are
     included in other current assets and other assets, respectively. For the
     three and nine months ended September 30, 1998, approximately $2,000 of
     non-recurring engineering costs are included in cost of revenues. The
     Agreement also requires the Company to purchase minimum quantities of the
     system representing a total purchase commitment of $2,250,000 through
     January 2000.


ITEM 2.  MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND 
         RESULTS OF OPERATIONS


     FORWARD LOOKING STATEMENTS AND ASSOCIATED RISKS

     This Quarterly Report on Form 10-QSB contains forward-looking statements
     within the meaning of Section 27A of the Securities Act of 1933 and Section
     21E of the Securities Exchange Act of 1934. The Company's actual results
     could differ materially from those set forth in the forward-looking
     statements.

     The following discussion should be read in conjunction with the attached
     consolidated financial statements and notes thereto and with the Company's
     audited financial statements and notes thereto for the fiscal year ended
     December 31, 1997.


     THREE MONTHS AND NINE MONTHS ENDED SEPTEMBER 30, 1998 COMPARED TO THREE 
     MONTHS AND NINE MONTHS ENDED SEPTEMBER 30, 1997

     REVENUES

     Revenues were approximately $407,000 for the third quarter 1998, a decrease
     of $307,000 or 43% from revenues of $714,000 for the third quarter 1997.
     Revenues of approximately $1,624,000 for the nine months ended September
     30, 1998 increased $290,000 or 22% from revenues of approximately
     $1,334,000 for the nine months ended September 30, 1997. The change in
     revenues for the three and nine months ended September 30, 1998 and 1997
     was primarily attributed to sales to a new customer which generated 0% and
     40% of the Company's total revenues for the third quarter 1998 and 1997 and
     26% and 25% of the Company's total revenues for the nine months ended
     September 30, 1998 and 1997, respectively. There is no assurance of future
     sales from the new customer. At September 30, 1998, the Company ended the
     quarter with over $94,000 in backlog compared to over $600,000 in backlog
     at September 30, 1997.

     GROSS PROFIT

     Gross profit was approximately $187,000 for the third quarter 1998, a
     decrease of $64,000 or 26% from gross profit of $251,000 for the third
     quarter 1997. Gross profit of approximately $607,000 for the nine months
     ended September 30, 1998 increased $129,000 or 27% from gross profit of
     approximately $478,000 for the nine months ended September 30, 1997. The
     change in gross profit for the three and nine months ended September 30,



                                       8


<PAGE>

     1998 and 1997 was primarily a result of the change in revenues and the
     sales mix of products sold. Gross profit margins approximated 46% and 35%
     for the third quarter 1998 and 1997 and 37% and 36% for the nine months
     ended September 30, 1998 and 1997, respectively. The Company realizes
     substantially higher gross profit margins on its manufactured products than
     it realizes on its purchased products due to the proprietary nature of
     purchased products, however, the current sales mix is expected to remain
     consistent as the Company's customer base expands.

     SELLING, GENERAL, AND ADMINISTRATIVE EXPENSES

     Selling, general, and administrative expenses were approximately $213,000
     for the third quarter 1998, an increase of $17,000 or 9% from selling,
     general, and administrative expenses of approximately $196,000 for the
     third quarter 1997. Selling, general, and administrative expenses of
     approximately $689,000 for the nine months ended September 30, 1998
     increased $129,000 or 23% from approximately $560,000 for the nine months
     ended September 30, 1997. Overall, operating expenses remained stable
     during 1998 with the exception of compensation expense and legal fees.
     Compensation expense increased over $18,000 for the three months ended
     September 30, 1998 primarily as a result of an increase of approximately
     $10,000 paid to new employees net of employee turnover and $7,500 of
     non-employee directors' compensation. Compensation expense increased nearly
     $60,000 for the nine months ended September 30, 1998 primarily as a result
     of an increase of approximately $27,000 paid to new employees net of
     employee turnover, $22,500 of non-employee directors' compensation, and
     $10,500 of common stock granted to the Company's officers and directors.
     Legal expenses increased approximately $33,000 for the nine months ended
     September 30, 1998 primarily due to the costs of litigating existing trade
     claims against a competitor of the Company and the costs of increased
     compliance reporting.

     INTEREST EXPENSE AND INTEREST INCOME

     Interest expense decreased to approximately $1,000 and $3,400 for the third
     quarter 1998 and for the nine months ended September 30, 1998 compared to
     $2,000 and $6,700 for the comparable periods in 1997 primarily due to the
     payment in full of the Company's 7.5% note payable to bank in March 1998.
     Interest income for each of the third quarters and the nine months ended
     September 30, 1998 and 1997 primarily represents interest earned on cash
     balances in excess of operating requirements.

     NET (LOSS)/INCOME AND NET (LOSS)/INCOME PER SHARE

     Net loss was approximately $(23,000) for the third quarter 1998, a decrease
     of $79,000 or 141% from the net income of $56,000 for the third quarter
     1997 primarily as a result of a decrease of approximately $64,000 in gross
     profit and an increase in operating costs of nearly $15,000.

     Net loss was nearly $(78,000) for the nine months ended September 30, 1998
     and 1997 primarily as a result of an increase of approximately $129,000 in
     both gross profit and operating costs during 1998.

     Net loss per share was $(0.02) for the third quarter 1998, a decrease of
     $0.06 per share or 150% from the net income per share of $0.04 for the
     third quarter 1997 resulting from the $79,000 decrease in net income offset
     by an increase of 134,274 weighted average number of common shares from
     1,542,927 during the third quarter 1997 to 1,677,201 during the third
     quarter 1998.

     Net loss per share was approximately $(0.05) from a net loss of nearly
     $78,000 for both the nine months ended September 30, 1998 and 1997 despite
     an increase of 128,322 weighted average number of common shares from
     1,528,302 during the nine months ended September 30, 1997 to 1,656,624
     during the nine months ended September 30, 1998.


                                       9


<PAGE>




     LIQUIDITY AND CAPITAL RESOURCES

     The Company's accumulated deficit was approximately $(1,780,000) and
     $(1,702,000) at September 30, 1998 and December 31, 1997, respectively.
     Working capital decreased approximately $68,000 from $798,000 at December
     31, 1997 to $730,000 at September 30, 1998.

     Net cash used in operating activities was approximately $(182,000) during
     the nine months ended September 30, 1998, a decrease of $46,000 from
     $(228,000) during the nine months ended September 30, 1997.

     The Company believes the expected results of operations in 1998 will be
     sufficient to fund current business operations and anticipated growth.
     However, the Company believes it may need to raise additional capital
     through debt or equity financing to fund its anticipated growth beyond
     1998. There is no assurance that such additional financing will be
     available when needed or available with terms acceptable to the Company.

     SEASONALITY

     The Company's revenues are substantially dependent on its customers'
     seasonal retail sales. Historically, the Company has experienced higher
     sales volume in the third and fourth quarters of each year.

     YEAR 2000 ISSUE

     Computer programs used by businesses worldwide were written using two
     digits rather than four digits to define the applicable year. Accordingly,
     these programs recognize the dates "00" and "01" as the years 1900 and 1901
     rather than the years 2000 and 2001. The Company recognizes the need to
     ensure its operations will not be adversely impacted by year 2000 computer
     program failures arising from program processes and calculations
     misinterpreting the year 2000 date. The Company is currently evaluating its
     financial and operational systems to determine the impact the year 2000
     issue will have on its operations. The Company also plans to communicate
     with its significant suppliers, dealers, financial institutions, and others
     with which it conducts business to determine the extent the Company may be
     impacted by third parties' failure to address the year 2000 issue. Although
     the Company plans to be year 2000 compliant prior to December 31, 1999 and
     expects no material impact to the Company's operations, there can be no
     assurance that the failure of the Company or such third parties to
     successfully address their respective year 2000 issues will not have a
     material adverse effect on the Company's business, financial condition,
     cash flows, and result of operations.



                                       10


<PAGE>




PART II.  OTHER INFORMATION


ITEM 1.   LEGAL PROCEEDINGS

     In October 1996, the Company was named as a defendant in a lawsuit filed in
     New Jersey Superior Court whereby the plaintiff is seeking damages with
     respect to certain alleged invoices totaling approximately $20,000. A
     motion to amend the pleadings was filed and granted to assert counterclaims
     and third party claims against the plaintiff and its officers for, among
     other things, false designation of origin under the federal Lanham Act,
     violations of statutory and common law unfair competition, trademark and
     trade dress infringement, and breach of contract all of which may result in
     damages exceeding $1,000,000. The Company's counterclaim and third party
     claims arose from an alleged intentional breach of a requirements type
     contract in which the plaintiff was authorized to manufacture for the
     Company certain equipment for sale to third parties. Although the Company
     has recorded in accrued liabilities a provision of approximately $20,000
     for any liability which may result from the plaintiff's claims, the Company
     plans to continue to vigorously defend against the plaintiff's alleged
     claims and to pursue its counterclaims and third party claims against the
     plaintiff. While there is no assurance as to the outcome of this legal
     action, management and legal counsel for the Company believe the ultimate
     resolution of this matter will not have a material adverse effect on its
     consolidated financial position or results of operations.

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

     The Annual Meeting of Shareholders of the Company was held on April 30,
     1998. The election of directors and the ratification of the appointment of
     the Company's independent certified public accountants were the only
     matters submitted to a vote of security holders. All five of the Company's
     incumbent directors were re-elected for the ensuing year which are Edward
     A. Mulhare, Thomas A. Nicolette, Saul Pozensky, Milan Resanovich, and
     Richard J. Spagna. The re-appointment of Spear, Safer, Harmon & Co. as the
     Company's independent certified public accountants for the ensuing year was
     ratified.

ITEM 5.  OTHER INFORMATION

     MARKET FOR REGISTRANT'S COMMON STOCK

     The Company's common stock has not commenced trading but is listed on the
     National Association of Securities Dealers, Inc. ("NASD") OTC Bulletin
     Board ("Bulletin Board") under the symbol "SETE". There have been no quotes
     on the Company's common stock since its listing on the Bulletin Board.

     No assurance can be given that a public trading market for the Company's
     common stock will develop or if developed will be sustained.

     In April 1997, in connection with a private placement of the Company's
     common stock under Regulation D Rule 506 of the Securities Act of 1933, as
     amended, the Company consummated the sale of 343,894 units, each unit
     consisting of one share of common stock and one common stock purchase
     warrant. Each warrant expires after five years of issuance and entitles the
     registered holder to purchase one share of common stock at a purchase price
     equal to the lesser of $5.50 or ten percent above the offering price of a
     share of common stock in a proposed public offering. The net proceeds
     received by the Company from this offering were approximately $707,000 of
     which approximately $198,000 from the sale of 88,173 units was received
     during the year ended December 31, 1997.

                                       11


<PAGE>





     APPOINTMENT OF NEW PRESIDENT AND CHIEF EXECUTIVE OFFICER

     On August 14, 1998, the Board of Directors appointed the Company's
     Executive Vice President, Ronald L. Meggison, Jr., as the Company's new
     President and Chief Executive Officer.

     Saul Pozensky relinquished his duties and responsibilities as the Company's
     President and Chief Executive Officer on August 14, 1998 and is no longer
     an employee of the Company. The Company is currently negotiating a proposed
     Separation Agreement for Saul Pozensky.

ITEM 6.  EXHIBITS AND REPORTS ON FORM 8-K

     On October 28, 1998, the Company entered into an Agreement and Plan of
     Merger with Ensec International, Inc. ("Ensec") which, upon completion of
     the merger, will result in the Company and Ensec becoming wholly owned
     subsidiaries of a newly formed holding company, Sensec International, Inc.
     ("Sensec"). Under the terms of the agreement, the Company's stockholders
     will receive approximately 40% or 950,000 shares of the outstanding common
     shares of Sensec, and the Ensec stockholders will receive approximately 60%
     or 1,425,000 shares of the outstanding common shares of Sensec. Completion
     of the merger is subject to the approval of the boards of directors and
     stockholders of both the Company and Ensec. Ensec is a systems integrator
     and services provider in commercial and industrial integrated security
     systems, video remote surveillance, and data information security systems
     and is listed on the OTC Bulletin Board under the symbol "ENSC". In
     connection with the planned merger, the Company is actively seeking various
     sources of capital. This transaction is more fully explained in the Form
     8-K filed by the Company on November 9, 1998 with the Securities and
     Exchange Commission.

SIGNATURES

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


                                          SENTECH EAS CORPORATION

                                          By: /s/ RONALD L. MEGGISON, JR.
                                              ---------------------------
                                          Ronald L. Meggison, Jr.
                                          President and Chief Executive Officer
                                          (Principal Financial and Accounting
                                           Officer)


                                          Date:   October 30, 1998


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