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

                                   FORM 10-QSB
(Mark One)

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

                For the quarterly period ended September 30, 1998

                                       or

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

For the transition period from                                 to              

Commission File Number:  0-1665                                               

                               EXTECH CORPORATION
        (Exact name of small business issuer as specified in its charter)

     Delaware                                           36-2476480            
(State or other jurisdiction                         (I.R.S Employer
of incorporation or organization)                    Identification No.)

90 Merrick Avenue, East Meadow, New York                     11554            
(Address of principal executive offices)                   (Zip Code)

                                 (516) 794-6300
              (Registrant's telephone number, including area code)

(Former name, former address and former fiscal year, 
if changed since last report)

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

                APPLICABLE ONLY TO ISSUERS INVOLVED IN BANKRUPTCY
                  PROCEEDINGS DURING THE PRECEDING FIVE YEARS:

     Indicate by check mark whether the  registrant  has filed all documents and
reports  required  to be filed by  Sections  12,  13 or 15(d) of the  Securities
Exchange Act of 1934 subsequent to the  distribution of securities  under a plan
confirmed by a court. ( )Yes ( ) No

     APPLICABLE  ONLY TO  CORPORATE  ISSUERS:  Indicate  the  number  of  shares
outstanding  of each of the issuer's  classes of common stock,  as of the latest
practicable date: 5,591,367 shares as of October 20, 1998

                                      INDEX

                       EXTECH CORPORATION AND SUBSIDIARIES

PART I.   FINANCIAL INFORMATION

Item 1.   Financial Statements

          Condensed Consolidated Balance Sheet - September 30, 1998 (Unaudited)

          Condensed  Consolidated  Statements  of Operations - Nine months ended
          September 30, 1998 and 1997 (Unaudited)

          Condensed  Consolidated  Statements of Operations - Three months ended
          September 30, 1998 and 1997 (Unaudited)

          Condensed  Consolidated  Statements  of Cash Flows - Nine months ended
          September 30, 1998 and 1997 (Unaudited)

          Notes to  Condensed  Consolidated  Financial  Statements - Nine months
          ended September 30, 1998 and 1997 (Unaudited)

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

PART II.  OTHER INFORMATION

Item 1.   Legal Proceedings
Item 2.   Changes in Securities
Item 3.   Defaults upon Senior Securities
Item 4.   Submission of Matters to a Vote of Security Holders
Item 5.   Other Information
Item 6.   Exhibits and Reports on Form 8-K

SIGNATURES

                                        2

PART I. FINANCIAL INFORMATION

Item 1. FINANCIAL STATEMENTS

                       EXTECH CORPORATION AND SUBSIDIARIES
                      CONDENSED CONSOLIDATED BALANCE SHEET
                                   (UNAUDITED)

                                                              September 30, 1998
ASSETS

CURRENT ASSETS:
  Cash and cash equivalents                                      $  406,275
  Accounts receivable                                                78,383
  Notes and other receivables                                       822,438
  Inventories                                                         8,103
  Prepaid expenses and
         other current assets                                        40,757
                                                                     ------
                  Total current assets                            1,355,956
                                                                  ---------

PROPERTY AND EQUIPMENT, net                                         101,216
                                                                    -------

OTHER ASSETS:
  Operating equipment, net                                           10,527
  Deposits                                                            5,000
  Restricted certificate of deposit                                  40,000
                                                                 ----------
                  Total other assets                                 55,527
                                                                     ------
                                                                 $1,512,699
                                                                 ==========

LIABILITIES AND STOCKHOLDERS' EQUITY

CURRENT LIABILITIES:
  Accounts payable                                               $    3,416
  Accrued expenses                                                   99,983
  Debentures payable                                                154,200
  Accrued taxes payable                                              11,430
                                                                 ----------
                  Total current liabilities                         269,029
                                                                    -------

MINORITY INTEREST                                                       560
                                                                        ---
STOCKHOLDERS' EQUITY:
  Common Stock, $.01 par value;
    authorized, 10,000,000 shares;
    issued and outstanding,
    5,591,367 shares                                                 55,914
  Capital in excess of par                                        5,264,950
  Deficit                                                        (4,077,754)
                                                                 -----------
                                                                  1,243,110
                                                                  ---------
                                                                 $1,512,699
                                                                 ==========

See notes to condensed consolidated financial statements.

                                        3

                       EXTECH CORPORATION AND SUBSIDIARIES
                 CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
                                   (UNAUDITED)

                                            Nine months ended
                                              September 30,
                                            1998        1997  
                                            ----        ----  
Revenues:
    Rooms                                $ 641,494     $ 697,702
    Other                                   15,146        16,237
    Interest                                66,586        47,580
                                         ---------     ---------
         Total revenues                    723,226       761,519
                                         ---------     ---------

Costs and expenses:
    General, administrative
      and sundry                           366,448       379,824
    Departmental                           219,505       222,286
    Depreciation and amortization           29,625        39,209
    Energy costs                            15,638        18,142
    Lease rentals                          130,026       139,986
    Marketing                               14,232        15,765
    Property operation
      and maintenance                       21,161        19,973
    Provision for bad debt                   1,700        13,122
                                         ---------     ---------

                                           798,335       848,307

Net loss                                $  (75,109)    $ (86,788)
                                         ==========     =========

Basic loss per common share:

    Net loss                            $     (.01)    $    (.02)
                                         ==========     ==========

Weighted average number of common
  shares outstanding                     5,591,367     5,591,367
                                        ==========    ==========

See notes to condensed consolidated financial statements.

                                        4

               EXTECH CORPORATION AND SUBSIDIARIES
         CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
                           (UNAUDITED)

                                           Three months ended
                                             September 30,
                                            1998        1997  
                                            ----        ----  
Revenues:
    Rooms                                $ 197,163     $ 185,067
    Other                                    4,942         6,964
    Interest                                24,370        17,380
                                         ---------     ---------
         Total revenues                    226,475       209,411
                                         ---------     ---------

Costs and expenses:
    General, administrative
      and sundry                           107,580       120,212
    Departmental                            72,907        73,030
    Depreciation and amortization            9,774        13,283
    Energy costs                             5,197         6,776
    Lease rentals                           39,553        39,291
    Marketing                                4,165         4,155
    Property operation
      and maintenance                        7,984         7,490
    Provision for bad debt                     600        12,522
                                         ---------     ---------

                                           247,760       276,759

Net loss                                $  (21,285)    $ (67,348)
                                         ==========     =========

Basic loss per common share:

    Net loss                            $     (.01)    $    (.01)
                                        ==========     ==========

Weighted average number of common
  shares outstanding                     5,591,367     5,591,367
                                        ==========    ==========

See notes to condensed consolidated financial statements.

                                        5

                       EXTECH CORPORATION AND SUBSIDIARIES
                 CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
                                   (UNAUDITED)

                                               Nine months ended
                                                September 30,
                                              1998         1997 
                                              ----         ---- 

Cash flows from operating activities:
  Net loss                                 $(75,109)   $ (86,788)
  Adjustments to reconcile net loss
  to net cash (used in) provided
  by operating activities:
   Depreciation and amortization             29,625       39,209
   Provision for bad debts                    1,700       13,122
Decrease (increase) in assets:
    Accounts receivable                     (41,845)         997
    Inventories                              (1,981)       2,839
    Prepaid expenses and other
           current assets                   (29,799)     108,461
    Notes receivable                       (468,860)      54,798
    Other assets                             (1,336)      (  524)
    Deposits                                   -0-        (5,000)
Increase (decrease) in liabilities:
    Accounts payable                          1,929        4,298
    Accrued expenses                       ( 47,883)     (26,752)
    Accrued taxes payable                    11,430       12,049
                                           ---------   ---------
  Net cash (used in) provided by
  operating activities                     (622,129)     116,709 
                                          ----------   ----------

Cash flows from investing activities:
  Purchases of property and equipment       (11,985)     (17,834)
                                          ----------   -----------
  Net cash (used in)
  investing activities:                     (11,985)     (17,834)
                                          ----------   -----------

Net (decrease) increase in cash and
cash equivalents                           (634,114)      98,875
Cash, beginning of period                 1,040,389    1,318,121
                                         -----------  ----------
Cash, end of period                      $  406,275   $1,416,996
                                         ===========  ==========

See notes to condensed consolidated financial statements.

                                        6

                       EXTECH CORPORATION AND SUBSIDIARIES
              NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
            NINE MONTHS ENDED SEPTEMBER 30, 1998 AND 1997 (UNAUDITED)

1.   The Condensed  Consolidated  Balance  Sheet as of September  30, 1998,  the
     Condensed  Consolidated  Statements  of  Operations  for the three and nine
     months ended  September  30, 1998 and 1997 and the  Condensed  Consolidated
     Statements  of Cash Flows for the nine months ended  September 30, 1998 and
     1997 have been prepared by EXTECH  Corporation  ("EXTECH" or the "Company")
     without audit. In the opinion of the Company,  the  accompanying  unaudited
     condensed   consolidated   financial  statements  contain  all  adjustments
     necessary to present  fairly its  financial  position as of  September  30,
     1998,  results of operations for the three and nine months ended  September
     30, 1998 and 1997 and cash flows for the nine months  ended  September  30,
     1998 and 1997. This report should be read in conjunction with the Company's
     Annual Report on Form 10-KSB for the year ended December 31, 1997.

2.   The  results  of  operations  and  cash  flows  for the nine  months  ended
     September  30,  1998 are not  necessarily  indicative  of the results to be
     expected for the full year.

                                        7

Item 2.  MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF
         OPERATION.

                  NINE MONTHS ENDED SEPTEMBER 30, 1998 AND 1997

Results of Operations:

     The  Company's  net loss for the nine months ended  September  30, 1998 was
$75,109 as compared to a net loss of $86,788 for the nine months ended September
30, 1997.  The loss for the nine months ended  September  30, 1998 was caused by
lower room occupancies of $56,208 as compared to the nine months ended September
30, 1997. The reduced loss was partially the result of increased interest income
of  $19,006  as a result  of a loan  made in  November  1997 to  Dealers  Choice
Automotive  Planning Inc. ("DCAP Insurance") which bears interest at the rate of
10% per annum  (see  "Prospects"  below)  and lower  expenses  of  $49,972.  The
foregoing  were  partially  offset by lower room  occupancies of $56,208 for the
nine months  ended  September  30,  1998 as  compared  to the nine months  ended
September 30, 1997.

Liquidity and Capital Resources:

     As of  September  30,  1998,  the  Company  had  $406,275  in cash and cash
equivalents  and a working  capital  surplus of  $1,086,927.  As of December 31,
1997,  the Company had  $1,040,389  in cash and cash  equivalents  and a working
capital surplus of $1,150,732.  The reduction in cash was due primarily to loans
in the  aggregate  amount of  $425,000  made to DCAP  Insurance  during the nine
months ended September 30, 1998 as well as losses from operations.

     Except as described below under  "Prospects,"  the Company did not have any
material commitments for capital expenditures as of September 30, 1998.

Prospects:

         DCAP:

     On May 8, 1998,  the Company  entered into an agreement with respect to the
acquisition of all of the issued and outstanding Common Shares of DCAP Insurance
as  well as  interests  in  certain  entities  affiliated  with  DCAP  Insurance
(collectively,  the "DCAP Companies")(the "DCAP Agreement").  The DCAP Companies
are  privately-held   and  offer,  as  brokers,   primarily  retail  automotive,
motorcycle,  boat,  life,  business and  homeowner's  insurance  products.  DCAP
Insurance has an aggregate of approximately  56 wholly-owned,  joint venture and
franchise locations in the New York metropolitan area.

     The DCAP Agreement  provides that, in  consideration  for the shares of the
DCAP Companies,  the Company will issue 3,300,000 shares of its Common Stock. In

                                        8

addition,  the  DCAP  Agreement  contemplates  that  the  shareholders  of  DCAP
Insurance  (the  "DCAP  Shareholders"),   together  with  Morton  L.  Certilman,
President  of EXTECH,  and Jay M. Haft,  Chairman  of the Board of EXTECH,  will
purchase, in the aggregate,  the 1,800,000 shares of Common Stock of the Company
beneficially  owned by Sterling  Foster Holding Corp.  ("Sterling  Foster") (the
"Sterling  Foster  Shares") as well as an aggregate of 1,402,000 other shares of
Common  Stock from the  Company.  Sterling  Foster has entered into an agreement
with each of the DCAP Shareholders and Messrs.  Certilman and Haft providing for
the  purchase  and sale of the  Sterling  Foster  Shares  concurrently  with the
closing of the DCAP  Agreement (the "Sterling  Foster  Agreement").  Each of the
parties has the right to terminate the Sterling Foster  Agreement if the closing
shall not have occurred by December 31, 1998.

     The  DCAP  Agreement  provides  further  that  the  purchases  by the  DCAP
Shareholders  will be made  following  loans of funds  by the  Company  for such
purpose (with respect to the purchases from Sterling  Foster) or by the delivery
of promissory notes as part of the purchase price (with regard to the additional
shares to be acquired from the Company).

     Simultaneously with the signing of the DCAP Agreement, the Company advanced
$311,000 to DCAP Insurance  (increasing its aggregate advances to DCAP Insurance
to $750,000).  The outstanding  advances,  together with interest at the rate of
10% per annum, are payable on December 31, 1998.

     The  consummation of the DCAP Agreement is subject to the satisfaction of a
number  of  conditions,  including  stockholder  and  certain  third  party  and
governmental approvals.  Each of the parties has the right to terminate the DCAP
Agreement  if the  closing  shall not have  occurred by December  31,  1998.  No
assurances  can be given  that the  acquisition  will take  place upon the terms
described above or otherwise.

         Eagle:

     On October 2, 1998,  the  Company  and Eagle  Insurance  Company  ("Eagle")
entered into a Subscription Agreement (the "Eagle Agreement") which provides for
the  issuance  and sale by the  Company to Eagle of  1,486,893  shares of Common
Stock for an aggregate  purchase price of  approximately  $1,000,000 (the "Eagle
Issuance").  The Eagle Issuance is to be made  concurrently  with the closing of
the DCAP  Agreement.  Each of the parties has the right to  terminate  the Eagle
Agreement  if the closing  shall not have  occurred by December  31,  1998.  The
closing of the Eagle Agreement is subject to a number of other conditions.

     Eagle is a New Jersey  insurance  company  wholly-owned  by The Robert Plan
Corporation ("The Robert Plan").  Pursuant to separate agency agreements between
certain DCAP Companies and certain insurance company  subsidiaries of The Robert
Plan, such DCAP Companies have been appointed agents of the insurance  companies
with regard to the offering of automobile and other insurance products.

                                        9

     In the event of the  closing of the DCAP  Agreement,  the  Sterling  Foster
Agreement and the Eagle Agreement,  the DCAP  Shareholders will own an aggregate
of approximately  43.8% of the outstanding Common Stock of the Company,  Messrs.
Certilman  and  Haft  will  own  an  aggregate  of  approximately  26%  of  such
outstanding  Common  Stock  and  Eagle  will  own  approximately  12.6%  of such
outstanding Common Stock.

                                       10

PART II.  OTHER INFORMATION

Item 1.   LEGAL PROCEEDINGS

          None

Item 2.   CHANGES IN SECURITIES

          None

Item 3.   DEFAULTS UPON SENIOR SECURITIES

          None

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

          None

Item 5.   OTHER INFORMATION

          Reference  is made to  "Prospects"  under  Part I, Item 2 hereof for a
          discussion of a certain Subscription Agreement between the Company and
          Eagle Insurance Company.

Item 6.   EXHIBITS AND REPORTS ON FORM 8-K

          (a)  Exhibits

               2    Agreement,  dated as of May 8,  1998,  by and among  EXTECH,
                    Morton L.  Certilman,  Jay M. Haft,  Kevin Lang and  Abraham
                    Weinzimer1

               3(a) Certificate of Incorporation, as amended2

               3(b) By-laws, as amended3

               27   Financial Data Schedule

          (b)  Reports on Form 8-K

               None

- --------

1    Denotes  document filed as an exhibit to the Company's  Quarterly Report on
     Form 10-QSB for the quarter ended June 30, 1998 and incorporated  herein by
     reference.

2    Denotes document filed as an exhibit to the Company's Annual Report on Form
     10-KSB for the year ended  December  31,  1993 and  incorporated  herein by
     reference.

3    Denotes  document filed as an exhibit to the Company's  Quarterly Report on
     Form 10-QSB for the quarter ended March 31, 1998 and incorporated herein by
     reference.

                                       11

                                   SIGNATURES

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

                                           EXTECH CORPORATION

Dated:  November  16, 1998                 By: /s/ Morton L. Certilman
                                               ---------------------------
                                               MORTON L. CERTILMAN
                                               President (Chief Operating 
                                               Officer and Principal Financial
                                               Officer)

                                       12

  

                     5

     The Schedule contains summary financial information extracted from the 
statements and is qualified in its entirety by reference to such financial
statements

                                   1
                                     U.S. Dollars

                   9-MOS
                              Dec-31-1998
                                 Jan-01-1998
                                   Sep-30-1998
                                1
                                         406,275
                                   0
                                  857,438
                                   35,000
                                    8,103
                               1,355,956
                                         397,183
                                 295,967
                                 1,512,699
                          269,029
                                        0
                          0
                                    0
                                       55,914
                                     1,187,196
                   1,512,699
                                        0
                               723,226
                                          0
                                  798,335
                               0
                               0
                             0
                                (75,109)
                                   0
                            (75,109)
                                 0
                                0
                                      0
                                   (75,109)
                                  (.01)
                                  0.00