WAVETECH INTERNATIONAL INC, S-3/A, 1998-12-07

WAVETECH INTERNATIONAL INC
S-3/A, 1998-12-07
TELEPHONE COMMUNICATIONS (NO RADIOTELEPHONE)

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As filed with the Securities and Exchange Commission on December 7, 1998
Registration No. 333-65135
================================================================================

SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
------------------

PRE-EFFECTIVE AMENDMENT NO. 1
TO
FORM S-3
REGISTRATION STATEMENT UNDER
THE SECURITIES ACT OF 1933
--------------

WAVETECH INTERNATIONAL, INC.
------------------------------------------------------
(Exact name of registrant as specified in its charter)

Nevada 86-0916826
------------------------------- ----------------
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) I.D. Number)

5210 East Williams Circle, Suite 200, Tucson, Arizona 85711
(520) 750-9093
-----------------------------------------------------------
(Address, including zip code, and telephone number,
including area code, of registrant's
principal executive offices)

Gerald I. Quinn
Wavetech International, Inc.
5210 East Williams Circle, Suite 200
Tucson, Arizona 85711
(520-750-9093)
---------------------------------------------------------
(Name, address, including zip code, and telephone number,
including area code, of agent for service)

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

The Commission is requested to send copies of all
communications to:

Christopher D. Johnson, Esq.
Squire, Sanders & Dempsey L.L.P.
Two Renaissance Square
40 North Central Avenue, Suite 2700
Phoenix, Arizona 85004

Approximate date of commencement of proposed sale to the public: As soon as
practicable from time to time after the date of this Registration Statement.

If the only securities being registered on this Form are being offered
pursuant to dividend or interest reinvestment plans, please check the following
box. [ ]

If any of the securities being registered on this Form are to be offered on
a delayed or continuous basis pursuant to Rule 415 under the Securities Act of
1933, other than securities offered only in connection with dividend or interest
reinvestment plans, check the following box.[X]

If this Form is filed to register additional securities for an offering
pursuant to Rule 462(b) under the Securities Act, please check the following box
and list the Securities Act registration statement number of the earlier
effective registration statement for the same offering. [ ] ____________________

If this Form is a post-effective amendment file pursuant to Rule 462(c)
under the Securities Act, check the following box and list the Securities Act
registration number of the earlier effective registration statement for the same
offering. [ ] ____________________

If delivery of the prospectus is expected to be made pursuant to Rule 434,
please check the following box.[ ]

THE REGISTRANT HEREBY AMENDS THIS REGISTRATION STATEMENT ON SUCH DATE OR
DATES AS MAY BE NECESSARY TO DELAY ITS EFFECTIVE DATE UNTIL THE REGISTRANT SHALL
FILE A FURTHER AMENDMENT WHICH SPECIFICALLY STATES THAT THIS REGISTRATION
STATEMENT SHALL THEREAFTER BECOME EFFECTIVE IN ACCORDANCE WITH SECTION 8(A) OF
THE SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT") OR UNTIL THIS
REGISTRATION STATEMENT SHALL BECOME EFFECTIVE ON SUCH DATE AS THE COMMISSION,
ACTING PURSUANT TO SAID SECTION 8(A), MAY DETERMINE.

<PAGE>
================================================================================
THE INFORMATION IN THIS PROSPECTUS IS NOT COMPLETE AND MAY BE CHANGED. THE
SELLING SHAREHOLDERS MAY NOT SELL THESE SECURITIES UNTIL THE REGISTRATION
STATEMENT FILED WITH THE SECURITIES AND EXCHANGE COMMISSION IS EFFECTIVE. THIS
PROSPECTUS IS NOT AN OFFER TO SELL THESE SECURITIES AND IT IS NOT SOLICITING AN
OFFER TO BUY THESE SECURITIES IN ANY STATE WHERE THE OFFER OR SALE IS NOT
PERMITTED.
================================================================================

SUBJECT TO COMPLETION, DATED DECEMBER 7, 1998

PROSPECTUS
4,456,921 SHARES

WAVETECH INTERNATIONAL, INC.

COMMON STOCK
---------------

The securities offered hereby (the "Offered Securities") are 4,456,921
shares of common stock, $.001 par value per share ("Common Stock"), of Wavetech
International, Inc., a Nevada corporation ("Wavetech" or the "Company"). The
Offered Securities will be offered and sold from time to time by certain
shareholders of the Company (the "Selling Shareholders"). See "Selling
Shareholders." The Company will not receive any of the proceeds from the sale of
the Offered Securities by the Selling Shareholders, although the Company will
receive up to an aggregate of $318,250.00 of gross proceeds upon exercise of
outstanding warrants to purchase 265,000 shares of Common Stock, all of which
are included in the Offered Securities. The Company intends to use such
proceeds, if any, for its general corporate purposes. Substantially all expenses
in connection with the registration of the Offered Securities will be borne by
the Company, except for any underwriters', brokers' and dealers' commissions
and/or discounts. See "Plan of Distribution" and "Selling Shareholders."

The Common Stock is traded on the Nasdaq SmallCap Market under the Symbol
"ITEL". On December 3, 1998, the closing sale price for the Common Stock was
$0.469 per share, as reported by The Nasdaq Stock Market, Inc.

This Prospectus may be used from time to time by the Selling Shareholders
to sell the Offered Securities. The offering price of such Common Stock will be
determined by the Selling Shareholders and such sales may be made or in the
over-the-counter market or otherwise, at prices and at terms then prevailing or
at prices related to the then current market price, or in negotiated
transactions. The Company will not receive any of the proceeds from the sale of
the Common Stock offered hereby.

SEE "RISK FACTORS" AT PAGE 10 FOR A DISCUSSION OF CERTAIN FACTORS TO BE
CONSIDERED PRIOR TO MAKING AN INVESTMENT DECISION IN THE SHARES OFFERED HEREBY.

--------------------
NEITHER THE SECURITIES AND EXCHANGE COMMISSION NOR ANY STATE
SECURITIES COMMISSION APPROVED OR DISAPPROVED OF THESE
SECURITIES OR PASSED UPON THE ADEQUACY OR ACCURACY
OF THIS PROSPECTUS. ANY REPRESENTATION TO THE
CONTRARY IS A CRIMINAL OFFENSE.
--------------------

The date of this Prospectus is _______________, 1998.
<PAGE>

AVAILABLE INFORMATION

The Company is subject to the informational requirements of the Securities
Exchange Act of 1934 (the "Exchange Act") and in accordance therewith files
reports and other information with the Securities and Exchange Commission (the
"Commission"). Such reports and other information (including proxy and
information statements) filed by the Company with the Commission may be read and
copied at the Public Reference Room of the Commission at 450 Fifth Street, N.W.,
Washington, D.C. 20549. Copies of such material can be obtained from the Public
Reference Room of the Commission at 450 Fifth Street, N.W., Washington, D.C.
20549, upon payment of prescribed rates. Information on the operation of the
Public Reference Room is available to the public by calling the Commission at
1-800-SEC-0330. In addition, the Commission maintains a website at
http://www.sec.gov that contains reports, proxy and information statements and
other information regarding issuers that file electronically with the
Commission.

The Company has filed with the Securities and Exchange Commission,
Washington, D.C. 20549, a Registration Statement on Form S-3 under the
Securities Act with respect to the Common Stock offered hereby. This Prospectus
does not contain all the information set forth in the Registration Statement and
the exhibits thereto. For further information with respect to the Company and
the Common Stock, reference is made to the Registration Statement including the
exhibits thereto, copies of which may be inspected at the Public Reference Room
of the Securities and Exchange Commission, Judiciary Plaza, 450 Fifth Street,
N.W., Washington, D.C. 20549, and copies of any part thereof may be obtained
from the office of the Commission in Washington, D.C. upon the payment of the
prescribed fee. The statements contained in this Prospectus and the contents of
any contract or other document filed as an exhibit are of necessity brief
descriptions thereof, are not necessarily complete and the full text of such
statements is qualified in its entirety by reference to such contract or
document.

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INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE

The following documents have been filed with the Commission by the Company
and are hereby incorporated by reference into this Prospectus: the Company's
Annual Report on Form 10-KSB for the fiscal year ended August 31, 1998, and the
description of the Company's Common Stock contained in the Company's
Registration Statement on Form 8-A filed with the Commission pursuant to Section
12(g) of the Exchange Act, Commission File No. 000-15482. All other documents
and reports filed pursuant to Sections 13(a), 13(c), 14 or 15(d) of the Exchange
Act from the date of this Prospectus and prior to the termination of the
offering of the Common Stock shall be deemed to be incorporated by reference
herein and shall be deemed to be a part hereof from the date of the filing of
such reports and documents.

Any statement contained in a document incorporated or deemed to be
incorporated by reference herein shall be deemed to be modified or superseded
for purposes of this Prospectus to the extent that a statement contained herein
or in any subsequently filed document which also is or is deemed to be
incorporated by reference herein modifies or supersedes such statement. Any such
statement so modified or superseded shall not be deemed, except as so modified
or superseded, to constitute a part of this Prospectus.

The Company will provide without charge to each person to whom a copy of
this Prospectus is delivered, on written or oral request of such person, a copy
of any or all documents which are incorporated herein by reference (not
including the exhibits to such documents, unless such exhibits are specifically
incorporated by reference in the document which this Prospectus incorporates).
Requests should be directed to Ms. Lydia Montoya, Chief Financial Officer, 5210
East Williams Circle, Suite 200, Tucson, Arizona 85711, telephone number (520)
750-9093.

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PROSPECTUS SUMMARY

THE FOLLOWING IS A SUMMARY OF CERTAIN INFORMATION APPEARING ELSEWHERE OR
INCORPORATED BY REFERENCE INTO THIS PROSPECTUS. REFERENCE IS MADE TO, AND THIS
SUMMARY IS QUALIFIED IN ITS ENTIRETY BY, THE MORE DETAILED INFORMATION AND
FINANCIAL STATEMENTS, INCLUDING THE NOTES THERETO, APPEARING ELSEWHERE OR
INCORPORATED BY REFERENCE INTO THIS PROSPECTUS. INVESTORS SHOULD CAREFULLY
CONSIDER THE INFORMATION SET FORTH UNDER THE HEADING "RISK FACTORS."

THE COMPANY

Wavetech International, Inc. a Nevada corporation (together with its
wholly-owned subsidiaries, the "Company" or "Wavetech") is primarily engaged in
operating, marketing, selling and customizing interactive communications systems
through the application of "intelligent" call processing technology and
proprietary software to reflect or target the needs of an identified audience.
These systems are often used as privatized networks for organizations and
special purpose groups. Although the Company was organized in 1986, it did not
commence its current operations until 1996. During 1994 and 1995, the Company's
operations consisted of infrastructure development for its call processing and
data management systems. Operations in the United States and Canada commenced on
a limited basis in 1996.

During fiscal year 1997, the Company sold an Interpretel System, consisting
of certain hardware and software to Switch Telecommunications Pty Ltd. of
Australia ("Switch") and installed this system on site. On June 30, 1998, an
agreement was reached between the Company and Switch which terminated an
existing license agreement and any future obligations thereunder. Consideration
of $150,000 was received by the Company in connection with this agreement. The
license agreement would have entitled Wavetech to receive license fees equal to
2% of gross revenues generated by use of the licensed technology upon Switch
activating a minimum of 15,000 cards. However, Switch and Wavetech were unable
to mutually agree upon the calculation of such revenues. See "Risk Factors --
Dependence on Licensing Relationships." Also on June 30, 1998, an agreement was
reached between the Company and Switch which set forth the terms and conditions
of a put option for the shares of common stock of Switch which the Company
acquired in August 1996. The option established a sale price of $2,100,000 and
had a term of one year. On August 25, 1998, the Company exercised the put option
thereby selling its entire interest in Switch and receiving $2,100,000 in
proceeds.

The Company conducts most of its operations through its wholly-owned
subsidiary, Interpretel, Inc., an Arizona corporation ("Interpretel").
Interpretel is a facilities-based telecommunication company using an advanced
computer telephony platform to deliver enhanced calling card services. The
Company's products are highly customized and branded for specific distributor
applications and feature a single point of access, via any touch-tone telephone,
to a suite of information and communication services.

Sample services currently offered by Interpretel include world-wide direct
calling, instant conference calling, over-the-phone language interpretation
supporting over 100 languages, fax-based language translation, news, weather and

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sports headlines, integrated voice and fax mail, integration with customer call
centers; and in Canada, Dun & Bradstreet Express business services, and legal
consultations and referrals. All services are billed on a post-pay basis
directly to the subscriber, usually via a credit card. Positioned as an
added-value service, principal benefits to distributors include cost-effective
information distribution and interactive marketing and promotion capability. The
product also becomes a customer retention vehicle and new profit center.

Since its inception, Interpretel has focused primarily on product
specifications, proprietary application software (including call-processing,
billing, membership and customer service database software), execution of vendor
contracts, development of corporate infrastructure (including customer service,
sales and marketing divisions, regional sales staff), design and printing of
product and marketing brochures, and strategic planning for international
business development. The Company's software packages are integrated into a
state-of-the-art communications system creating a platform network that can be
duplicated in other locations.

Interpretel has been issued a tariff, bearing F.C.C. Tariff No. 2, filed in
compliance with the requirements of the Communications Act of 1934, as amended,
with the Federal Communications Commission.

On March 10, 1995, Interpretel (Canada) Inc. was incorporated under the
laws of the Province of Ontario as a wholly-owned subsidiary of Interpretel,
Inc. It was formed to secure a long distance reseller's registration and license
in that country through the Canadian Radio and Television Commission (CRTC),
which is the Canadian equivalent of the FCC. This reseller's license qualifies
Interpretel (Canada) Inc. to operate as a reseller of long distance services and
secure contracts with Canadian corporations and organizations as a Canadian
entity. Interpretel (Canada) Inc. is essentially a sales and customer service
operation.

Interpretel has a staff of four employees. Wavetech has no employees. The
Company currently has operations underway in the United States and Canada.

FEATURES AND CAPABILITIES OF THE COMPANY'S INTERACTIVE SYSTEM

The Company's call-processing architecture is a UNIX-based multi-tasking
digital call-processing system integrated with a Tandem database server, which
provides the ability to manage a wide range of diverse applications on a single
platform. The Company's computer telephony integration technology is modularly
designed and can support virtually limitless expansion and capacity. The system
offers direct T-1/DS-3 connectivity with the public telephone network via MCI
and it is also networked remotely for customer service and database management.

The Company's database management system is currently administered from its
corporate offices in Tucson, Arizona, with the call processing platforms located
in Lincoln, Nebraska.

The Company currently offers the following programs:

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THE INTERPRETEL TRAVELER CARD. Designed for worldwide business and travel
use, this application offers voice and fax mail with pager notification;
over-the-phone language interpretation; fax-based document translation; 12-way
conference calling; news and sports headlines; and access to domestic and
international calling card long distance service. Line charges are billed to the
subscriber's credit card of choice. The Company has distributed this program by
bundling it with other third party membership packages, where the demographics
of the membership base include frequent and/or regular travel. The Company has
also promoted this product through direct mail marketing.

THE AFFINITY CARD PROGRAM. Building on the Interpretel Card, this program
allows a company to customize and brand Interpretel's communication services, as
well as integrate present or new services into an automated telphone
application. The Company currently has Affinity Card programs with Diners Club
International and Delta Hotels & Resorts. The Affinity Card Program has
historically constituted the cornerstone of the Company's marketing and sales
initiatives.

THE VIRTUAL OFFICE PROGRAM. Built as a customized "affinity" product and
featuring many of the same services as the Interpretel Traveler Card, this
product is positioned for the Small Office/Home Office (SOHO) market and uses a
private "888" number for access. Unique to this program is a "follow-me"
function which dials and searches multiple phone numbers locating the
subscriber.

THE INTERACTIVE MARKETING PROGRAM. The Company's advanced call-processing
system can be used for non-card based applications, including interactive voice
response, fax-backs, surveys/polling and meet-me conferencing systems. The
modular call-processing architecture allows easy creation of applications with
virtually no limit. If the Company is able to develop greater, stronger sales
and marketing infrastructure and resources, this program will receive greater
attention in the future.

The Company experiences significant competition in its business. See "Risk
Factors -- Intense Competition" below. To date, the Company has been unable to
generate significant revenues from its Interpretel program offerings. However,
to the extent that it has received such revenues, they have been almost entirely
from the Interpretel Traveler Card.

STRATEGIES FOR THE FUTURE

The Company's management and Board of Directors believe that the Company
has strong relationships and contracts with major companies and also has product
offerings that can easily be customized and expanded to meet a variety of
business and individual needs. However, the Company lacks the resources needed
to properly market these products and services and thereby achieve high
distribution and usage, which would generate revenues. Early in fiscal 1998, the
Board of Directors instructed the Company's management to seek out a potential
business combination for the Company. The Board determined that a business
combination presented a greater opportunity to rapidly promote its products than
commercial or other financing. In addition, the Board believed that any

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financing that would be available to the Company would be so on terms that were
unattractive. As a result of these considerations, in January 1998, the Company
executed a Reorganization Agreement with Imagitel, Inc. However, in August 1998,
the Reorganization Agreement was terminated because the Company determined it
was no longer in the best interests of its shareholders due to certain material
adverse changes in Imagitel's business since execution of that Agreement.
Promptly following termination of the Imagitel agreement, the Company reviewed
dozens of potential merger and acquisition candidates. After considering the
relative risks and merits of the opportunities which it reviewed, on November 6,
1998, the Company signed a Merger Agreement with DCI Telecommunications, Inc.
(OTCBB:DCTC) ("DCI"), an international provider of telephone and other services,
including long distance, prepaid telephone cards and Internet services. DCI has
an extensive distribution network throughout North America, Europe and the Far
East. DCI owns telephone switching facilities in Canada, the United Kingdom,
Spain and Denmark and has 12 operating facilities serving customers in eight
countries. The Company expects the Merger to combine the strengths of both
companies and to create an international carrier with enhanced services and call
management switching equipment in the U.S., Canada and Europe. The Merger is
anticipated to provide the support the Company needs to successfully market its
product through its current and future contracts. However, there can be no
assurance that the Merger will result in these anticipated benefits. See "Risk
Factors -- Risks Associated with Pending Merger." Consummation of the Merger is
also subject to a number of conditions, many of which the Company may be unable
to control. There can be no assurance, however, when or if the Merger will be
completed.

If the Merger is completed, it will result in a change of control of the
Company, with DCI's shareholders holding in excess of 85% of the outstanding
Common Stock and a new slate of executive officers and directors. As a result,
the strategy for developing and marketing the Company's products will be
directed by this new management. In the interim, the Company has pursued the
promotion of its products through the following methods: select advertising in
travel-related publications for the Interpretel Traveler Card designed to
increase the number of subscribers of the Company's basic product. In addition,
the Company is also working with current clients to revise existing programs in
order to increase distribution and usage of the services. The Company is
preserving its capital pending the completion of the Merger, if ever.

Wavetech was incorporated in the State of New Jersey on July 10, 1986 under
the name "Wavetech, Inc.", and in February 1998 changed its state of
incorporation to the State of Nevada. Its corporate headquarters are located at
5210 East Williams Circle, Suite 200, Tucson, Arizona 85711, and its telephone
number is (520) 750-9093.

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REFLECT MANAGEMENT'S EXPECTATIONS AND ESTIMATES ON THE DATE OF THIS REPORT.
ACTUAL EVENTS OR RESULTS MAY DIFFER MATERIALLY FROM THESE EXPECTATIONS. IN
EVALUATING THOSE STATEMENTS, YOU SHOULD SPECIFICALLY CONSIDER VARIOUS FACTORS,
INCLUDING THE RISK INCLUDED IN THE REPORTS FILED BY WAVETECH WITH THE SEC. THESE
FACTORS MAY CAUSE ACTUAL RESULTS TO DIFFER MATERIALLY FROM ANY FORWARD-LOOKING
STATEMENTS. WAVETECH IS NOT UNDERTAKING ANY OBLIGATIONS TO UPDATE ANY
FORWARD-LOOKING STATEMENTS CONTAINED IN THIS REPORT.

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THE OFFERING

Securities Offered Hereby......... 4,456,921 shares of Common Stock

Common Stock Outstanding as
of November 23, 1998.............. 17,151,137 shares (1)

Use of Proceeds................... The Selling Shareholders will receive
all of the proceeds from the sale of
the Offered Securities. None of the
proceeds of this Offering will be
received by the Company, although the
Company will receive up to an aggregate
of $318,250.00 of gross proceeds upon
exercise of outstanding warrants to
purchase 265,000 shares of Common Stock,
all of which are included in the Offered
Securities. The Company intends to use
such proceeds, if any, for its general
corporate purposes.

Risk Factors...................... The securities offered hereby involve a
high degree of risk. See "Risk Factors."

Nasdaq SmallCap Market Symbol..... "ITEL"

(1) Excludes 2,650,000 shares issuable pursuant to outstanding options,
1,050,231 shares reserved for issuance pursuant to future grants under the
Company's Amended and Restated 1997 Stock Incentive Plan, and 2,295,000
shares issuable pursuant to unexercised warrants (including 265,000 shares
offered pursuant to the Registration Statement of which this Prospectus
forms a part).

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RISK FACTORS

AN INVESTMENT IN THE COMMON STOCK OFFERED HEREBY INVOLVES A HIGH DEGREE OF
RISK AND SHOULD ONLY BE MADE BY INVESTORS WHO CAN AFFORD THE LOSS OF THEIR
ENTIRE INVESTMENT. PROSPECTIVE INVESTORS, PRIOR TO MAKING AN INVESTMENT
DECISION, SHOULD GIVE CAREFUL CONSIDERATION, IN ADDITION TO THE OTHER
INFORMATION CONTAINED IN THIS PROSPECTUS, TO THE FOLLOWING RISK FACTORS.

THIS PROSPECTUS CONTAINS "FORWARD-LOOKING STATEMENTS", INCLUDING STATEMENTS
RELATING TO FUTURE EVENTS, INCLUDING A PROPOSED MERGER OR THE FUTURE FINANCIAL
PERFORMANCE OF WAVETECH. IN SOME CASES, YOU CAN IDENTIFY FORWARD-LOOKING
STATEMENTS BY TERMINOLOGY SUCH AS "MAY," "WILL," "SHOULD," "EXPECTS," "PLANS,"
"ANTICIPATES," "BELIEVES," "ESTIMATES," "PREDICTS," "POTENTIAL," OR "CONTINUE"
OR THE NEGATIVE OF SUCH TERMS AND OTHER COMPARABLE TERMINOLOGY. THESE ONLY
REFLECT MANAGEMENT'S EXPECTATIONS AND ESTIMATES ON THE DATE OF THIS REPORT.
ACTUAL EVENTS OR RESULTS MAY DIFFER MATERIALLY FROM THESE EXPECTATIONS. IN
EVALUATING THOSE STATEMENTS, YOU SHOULD SPECIFICALLY CONSIDER VARIOUS FACTORS,
INCLUDING THE RISK INCLUDED IN THE REPORTS FILED BY WAVETECH WITH THE SEC. THESE
FACTORS MAY CAUSE ACTUAL RESULTS TO DIFFER MATERIALLY FROM ANY FORWARD-LOOKING
STATEMENTS. WAVETECH IS NOT UNDERTAKING ANY OBLIGATIONS TO UPDATE ANY
FORWARD-LOOKING STATEMENTS CONTAINED IN THIS REPORT.

PREVIOUS LOSSES. The Company has incurred net losses of approximately
$(1,216,887), $(1,775,714), $(1,860,204) and $(1,055,099) during each of the
fiscal years ended August 31, 1998, 1997, 1996 and 1995, respectively. Although
the Company recorded revenues for the quarter ended February 28, 1997, it has
incurred losses since then and there can be no assurance that the Company will
record a profit in any future periods. If the Company is unable to operate at a
profit, its financial position and results of operations, as well as the price
at which its Common Stock trades, may be materially adversely affected.

LIMITED OPERATING HISTORY. Interpretel, Inc., the Company's principal
operating subsidiary, was incorporated in 1995; however, it did not have any
significant business operations until 1997. Accordingly, the Company has only a
limited operating history upon which an evaluation of the Company and its
prospects can be based. The Company's prospects must be considered in light of
the risks, expenses and difficulties frequently encountered by companies in
their early stages of operations. Such risks include, but are not limited to,
the possibility that the Company may be unable to develop products and services
which are responsive to consumer demands, unable to achieve sales of such
products and services sufficient to enable the Company to become profitable, and
unable to develop the operational infrastructure necessary to support its
intended operations. To the extent the Company is unable in the future to
adequately address these and other risks and uncertainties associated with its
early stage of operations, its business, financial condition and results of
operations may be materially adversely affected.

RISK OF DELISTING. The Company has been notified by Nasdaq that its Common
Stock will be delisted because it is currently not in compliance with the $1.00
minimum bid price requirement. Wavetech appealed Nasdaq's decision to delist its
Common Stock for failure to meet this requirement at a hearing in November 1998.
However, an unfavorable outcome of such hearing or the failure to satisfy one or

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more of the other maintenance requirements of Nasdaq could result in the
Company's securities being delisted from Nasdaq. Even if Wavetech's appeal is
successful, Nasdaq will need to approve the listing of the shares of Wavetech
Common Stock to be issued as a result of the proposed merger with DCI. If
Wavetech Common Stock is delisted for any of the results discussed above, the
result would be that the Company's securities would trade on the OTC Bulletin
Board or in the "pink sheets" maintained by the National Quotation Bureau
Incorporated. As a consequence of such delisting, an investor could find it more
difficult to dispose of or to obtain accurate quotations as to the market value
of the Company's securities. Among other consequences, delisting from Nasdaq may
cause a decline in the stock price, the loss of news coverage about the Company
and difficulty in obtaining future financing.

RISKS ASSOCIATED WITH PENDING MERGER. On November 6, 1998, the Company
executed a Merger Agreement with DCI Telecommunications, Inc. Consummation of
the merger is subject to a number of conditions, and there can be no assurances
when it will be completed, if at all. If the merger is completed, it will
involve a number of risks and uncertainties, including the following:

* Potential for significant disruption and unanticipated consequences to
each of DCI's and Wavetech's business operations;

* Failure to achieve anticipated benefits, such as operational
efficiencies, and technological synergies;

* Substantial dilution to existing Wavetech shareholders;

* Change of control of Wavetech; and

* Change in management, personnel and directors of Wavetech.

FACTORS AFFECTING OPERATING RESULTS. The Company's operating results have
varied significantly from period to period in the past and may vary
significantly in the future. Special factors that may cause the Company's future
operating results to vary include the unique nature of strategic relationships
into which the Company may enter in the future, changes in operating expenses
resulting from such strategic relationships and other factors, the timing of new
services and announcements, market acceptance of new and enhanced versions of
the Company's existing services, potential acquisitions, changes in legislation
and regulation that may affect the competitive environment for the Company's
communications services and general economic and seasonal factors, among others.
In the future, revenues from the Company's strategic relationships may become an
increasingly significant portion of the Company's total revenues. Due to the
unique nature of each strategic relationship, these relationships may change the
Company's mix of expenses relative to revenues.

POTENTIAL FLUCTUATIONS IN QUARTERLY RESULTS. Quarterly revenues are
difficult to forecast because the market for the Company's information and
telecommunications services is rapidly evolving. The Company's expense levels
are based, in part, on its expectations as to future revenues. If actual revenue
levels are below expectations, the Company may be unable or unwilling to reduce
expenses proportionately and operating results would likely be adversely

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affected. As a result, the Company believes that period-to-period comparisons of
its results of operations are not necessarily meaningful and should not be
relied upon as indications of future performance. Due to all of the foregoing
factors, among others, it is likely that in some of the Company's future fiscal
quarters, the Company's operating results will be below the expectations of
public market analysts and investors. In such event, the price of the Company's
Common Stock will likely be adversely affected.

INTENSE COMPETITION. The information and telecommunications services
industries are intensely competitive, rapidly evolving and subject to rapid
technological change. The Company expects competition to increase in the future.
Many of the Company's current and potential competitors have longer operating
histories, greater name recognition, larger customer bases and substantially
greater financial, personnel, marketing, engineering, technical and other
resources than the Company. For example, the Company's worldwide long distance
services and features, such as conference calling, compete with services
provided by companies such as AT&T Corporation ("AT&T"), MCI WorldCom, Inc.
("MCI"), and Sprint Communications Company ("Sprint"), as well as smaller
interexchange long distance providers. The Company's voice mail services compete
with voice mail services provided by certain regional Bell operating companies
("RBOCs") as well as by independent voice mail vendors such as Octel
Communications Corporation ("Octel"), NorthernTelecom, Inc. ("Nortel"), and
Siemens Business Communications Systems, Inc. ("Siemens"), among others. The
Company may introduce enhancements to its existing services in the future. Such
services are likely to compete with services offered by other companies, many of
which have greater marketing, financial and other resources than the Company.
The Company also expects that other parties will develop and implement
information and telecommunications service platforms similar to that of the
Company, thereby increasing competition for the Company's existing services.
There can be no assurance that the Company will be able to successfully compete
with such entities. Such current or future competition could materially
adversely affect the Company's business, operating results and financial
condition.

In addition, the Telecommunications Act of 1996 (the "1996 Act") allows
local exchange carriers ("LECs"), including the RBOC's to immediately provide
long distance telephone services between Local Access and Transport Areas
("LATAs") located outside of their local service territories, which will likely
significantly increase competition for long distance services. The 1996 Act also
grants the Federal Communications Commission (the "FCC") the authority to
deregulate certain aspects of the telecommunications industry, which in the
future may, if authorized by the FCC, facilitate the offering of an integrated
suite of personal communications services by regulated entities, including the
RBOCs, in competition with the Company.

Telecommunications companies often compete for consumers based on price
with major long distance carriers conducting extensive advertising campaigns to
capture market share. Many of the Company's competitors are able to realize a
profit while offering low rates to individual consumers because they are able to
attract a greater number of total customers than the Company. As a result, the
Company may be required to reduce the prices at which it offers services in
order to make its services attractive to customers. However, if the Company is
unable to generate sufficient revenues to offset its expenses, it will be unable

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to become profitable. A decrease in the rates charged for communications
services by the major long distance carriers or other competitors, whether
caused by general competitive pressures or the entry of the RBOCs and other LECs
into the long distance market, could have a material adverse effect on the
Company's business, operating results and financial condition.

The Company expects that the information and telecommunications services
markets will continue to attract new competitors and new technologies, possibly
including alternative technologies that are more sophisticated and cost
effective than the Company's technology. The Company does not have the
contractual right to prevent its subscribers from changing to a competitor's
network, and the Company's subscribers may generally terminate their services
with the Company at will. If the Company is unable to compete with emerging
technologies or services, it may lose customers and, as a result, its business
and operating results may be materially adversely affected.

The Company believes that the principal competitive factors affecting the
markets for its products include customer service, content, quality, price,
marketing, distribution, uninterrupted service and proprietary technology. In
addition, consumer demand for particular telecommunications products may be
adversely affected by the increasing number of competitive products from which
to choose, making it difficult to predict the Company's future success in
producing personal telecommunications products for the retail market.

RAPID TECHNOLOGICAL CHANGE. In order to generate revenues and attract
customers, the Company will need to quickly identify and adopt changing
technology. The information and telecommunications services markets in which the
Company competes are characterized by rapid technological change, frequent new
product introductions and evolving industry standards. The Company's future
success will depend in significant part on its ability to anticipate industry
standards, apply advances in technologies, enhance its current services, enhance
its software and call processing platform and achieve market acceptance of
products and services based on evolving or new technology. The Company may
introduce new products and services, and enhancements to existing products and
services, which will complement the services currently offered or planned by the
Company. However, rapid changes in technology and product obsolescence require
the Company to develop or acquire new products and to enhance its existing
products on a timely basis. There is no assurance that the Company will be able
to predict such changes or have the resources required or otherwise be able to
respond to market or technological changes in order to compete successfully in
the future.

DEPENDENCE ON NEW SERVICES. The Company's operating and growth strategies
are largely dependent upon its ability to develop new services in a timely and
effective manner. Development and implementation of such services is expected to
require the Company to upgrade its existing systems, acquire new technological
and other resources and develop additional strategic relationships. There can be
no assurances that the Company will be able to meet these needs. The Company
intends to upgrade its call processing network during fiscal 1999.

The Company's future planned products may include new products based on its
custom post-pay calling card program, including a "virtual office" service.
Implementation of this service does not require any hardware purchases or

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installation of additional phone lines; however, the Company's management will
be required to devote its energy and resources to the development,
implementation and marketing of this and other future planned products. There
can be no assurance that such product will ultimately generate revenues
sufficient to offset the costs associated with the development and marketing of
any future planned product or service. There can be no assurance that the
Company will be successful in developing and marketing service enhancements or
new services in response to technological changes, evolving industry standards
or customer demands and preferences. The Company may experience difficulties
that could delay or prevent the successful development, introduction and
marketing of its services. Additionally, to the extent the Company is able to
develop new services, if at all, there can be no assurances that such services
or any enhancements thereto, will adequately meet the requirements of the
marketplace and achieve market acceptance. Delays in the introduction of new
services, the inability of the Company to develop such new services or the
failure of such services to achieve market acceptance could have a material
adverse effect on the Company's business, operating results and financial
condition.

UNCERTAINTY OF STRATEGIC RELATIONSHIPS. If the Company is unable to develop
strategic relationships that generate net revenues, it will continue to incur
losses. A principal element of the Company's growth strategy is the creation and
maintenance of strategic relationships that will enable the Company to offer its
services to a larger customer base than the Company could otherwise reach
through its direct marketing efforts. The Company has entered into or initiated
strategic relationships with several companies, including DonTon Travel, Inc.
and Pacific Image, Inc. These relationships were formed recently, and have not
produced significant revenues to date. There can be no assurances as to when, if
ever, any of such relationships will generate revenues or net profits for the
Company. The Company is unable to predict their success or failure due to
limited operating experience with these strategic partners. The Company believes
that its strategic partner relationships may be an effective and efficient means
of marketing its products and services. Consequently, the Company's future
success is largely dependent upon the ultimate success of these relationships
and on the ability of these strategic partners to effectively market the
Company's services. Failure of one or more of the Company's strategic partners
to successfully develop and sustain a market for the Company's services, or the
termination of one or more of the Company's relationships with a strategic
partner, could have a material adverse effect on the Company's overall
performance due to the possibility of more costly direct marketing expenditures
by the Company and other factors.

Although the Company views its strategic relationships as a key factor in
its overall business strategy and in the development and commercialization of
its services, there can be no assurance that its strategic partners view their
relationships with the Company as significant for their own businesses or that
they will not reduce or even eliminate their commitment to the Company in the
future. The Company's arrangements with its strategic partners do not establish
minimum performance requirements for the Company's strategic partners, but
instead rely on the voluntary efforts of these partners in pursuing joint goals.
The ability of the Company's strategic partners to incorporate the Company's
services into successful commercial ventures will require the Company, among
other things, to continue to successfully enhance its existing services and
develop new services. The Company's inability to meet the requirements of its

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<PAGE>

strategic partners or to comply with the terms of its strategic partner
arrangements could result in its strategic partners failing to market the
Company's services, seeking alternative providers of communication and
information services or canceling their contracts with the Company, any of which
could have a material adverse impact on the Company.

DEPENDENCE ON LICENSING RELATIONSHIPS. To date, the Company has licensed
its services to one company, Switch, located in Australia. The Switch licensing
arrangement was terminated on June 30, 1998 and the Company received $150,000.00
from Switch as consideration for terminating the licensing agreement. When in
effect, the license agreement entitled Wavetech to receive license fees equal to
2% of the gross revenues generated by Switch with the licensed technology, after
Switch activated at least 15,000 cards. By terminating the agreement, Wavetech
gave up the right to receive these revenues in the future. However, Wavetech and
Switch terminated the agreement because they were unable to agree on the amount
of the license fees to be paid. The Company currently has no other licenses with
other entities. The Company intends to seek additional licensing arrangements.
However, the majority of companies that have historically outsourced
communications card services to the Company have been small or medium-sized
telecommunications companies that may be unable to withstand the intense
competition and rapid change currently experienced in the telecommunications
industry. The inability of the Company to attract larger or more license
transactions, the failure of one or more of the Company's licensees to develop
and sustain a market for the Company's services, or termination of one or more
of the Company's licensing relationships, could have a material adverse effect
on the Company's business, operating results and financial condition.

ABILITY TO MANAGE GROWTH. In order to maintain its viability, the Company
will need to experience substantial growth in 1999 and thereafter as it begins
to operate its call processing networks. This growth, if any, can be expected to
place significant demands on all aspects of the Company's business, including
its administrative, technical and financial personnel and systems. In addition,
expansion by the Company may strain the Company's management, financial and
other resources. There can be no assurance that the Company's systems,
procedures, controls and existing resources will be adequate to support
expansion of the Company's operations. The Company's future operating results
will substantially depend on the ability of its officers and key employees to
manage changing business conditions and to implement and improve its technical,
administrative, financial control and reporting systems. If the Company is
unable to respond to and manage changing business conditions, then the quality
in the Company's services, its ability to retain key personnel and its results
of operations could be materially adversely affected. At certain stages of
growth in network usage, the Company is required to add capacity to the call
processing platform, thus requiring the Company to continually predict growth in
its network usage and add capacity to its system accordingly. Difficulties in
managing continued growth, including difficulties in predicting the growth in
network usage, could have a material adverse effect on the Company, its business
and results of operations.

DEPENDENCE ON KEY MANAGEMENT AND PERSONNEL. The Company currently has only
four employees. The Company's survival has historically been largely dependent
upon each of such employees, the loss of one or more of whom could have a
material adverse effect on the Company. The Company believes that its ability to
become successful in the future will depend to a significant extent upon the

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<PAGE>

efforts and abilities of its executive officers and other key personnel. The
loss of services of any of these individuals could have a material adverse
effect upon the Company. The Company does not currently maintain key person life
insurance on the lives of any of these persons.

The Company also believes that its success depends upon its ability to hire
and retain highly qualified engineering and product development personnel.
Competition in the recruitment of qualified personnel in the information and
telecommunications services industry is highly intense. The inability of the
Company to identify, attract and retain such personnel may have a material
adverse effect on the Company. No assurance can be given that the Company will
be able to retain its key employees or that it will be able to attract qualified
personnel in the future.

The Company, in an effort to dramatically reduce its overhead, drastically
reduced its numbers of key management, technical and operations employees in
1997. Some of the positions that the Company eliminated are crucial to the
Company's future success, and the Company will need to hire additional personnel
in order to carry out its current business plan. Competition for persons with
the skills and experience which the Company seeks is intensely competitive, and
there are no assurances that the Company can either attract or retain the
qualified personnel required to create and manage growth, nor can it assure that
it will generate revenues sufficient to offset the costs of attracting and
retaining such personnel.

DEPENDENCE ON CALL PROCESSING PLATFORM, DAMAGE, FAILURE AND DOWNTIME.
Delivery of the Company's services is dependent upon the uninterrupted service
of its call processing platform and other systems. The Company currently
maintains a single UNIX-based multi-tasking call-processing system integrated
with a Tandem database server located in Lincoln, Nebraska. See "-- Dependence
Upon Telecommunications Providers, Specifically MCI and Interact, Inc." below.
The Company has taken certain precautions to protect its systems from events
that could interrupt delivery of the Company's services including, damage that
may be caused by fire, power loss, technical failures, unauthorized intrusion,
natural disasters, sabotage and other similar events. See also "-- Risks
Associated with Year 2000" below. These precautions include physical security
systems, an uninterruptible power supply and an on-site power generator designed
to be sufficient to continue operation of the Company's network in the event of
a power outage. The Company's network is further designed such that the data on
each network server is duplicated on a separate network server. Notwithstanding
such precautions, there can be no assurance that a fire, act of sabotage,
technical failure, natural disaster or a similar event would not cause the
failure of a network server and its backup server, other portions of the
Company's network, or the Lincoln facility as a whole, thereby resulting in an
outage of the Company's services. Such an outage could have a material adverse
effect on the Company.

While the Company has not experienced any downtime of its network due to
natural disasters or similar events, on occasion the Company has experienced
downtime due to various technical failures. When such failures have occurred,
the Company has worked to remedy the failure as soon as possible. The Company
believes that these technical failures have been infrequent and have not
resulted in any material downtime of the call processing platform since the
Company's inception. Although the Company maintains business interruption
insurance providing for aggregate coverage of approximately $25,000 per
occurrence, there can be no assurance that the Company will be able to maintain

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its business interruption insurance, that such insurance would continue to be
available at reasonable prices, that such insurance would cover all such losses
or that such insurance would be sufficient to compensate the Company for losses
it experiences due to the Company's inability to provide services to its
subscribers.

LIMITED PROTECTION OF PROPRIETARY TECHNOLOGY. The Company relies primarily
on a combination of copyright and trade secret laws and contractual
confidentiality provisions to protect its proprietary rights. These laws and
contractual provisions provide only limited protection of the Company's
proprietary rights. The Company has no patents or patent applications pending
and has no registered trademarks or copyrights. Despite the Company's efforts to
protect its proprietary rights, unauthorized parties may attempt to copy aspects
of the Company's software or services or to obtain and use information that the
Company regards as proprietary. Although the Company is not aware of any current
or previous infringement upon its proprietary rights, there can be no assurance
that the Company's means of protecting its proprietary rights will be adequate
or that the Company's competitors will not independently develop similar
technology. In addition, the laws of some foreign countries do not protect the
Company's proprietary rights to as great an extent as the laws of the United
States. An inability of the Company to adequately protect its proprietary
technology or other assets could have a material adverse effect on its business
and results of operations.

RISKS OF INFRINGEMENT BY THE COMPANY. To date, no actions have been filed
against the Company with respect to either alleged patent or trademark
infringement claims. However, no assurance can be given that actions or claims
alleging trademark, patent or copyright infringement will not be brought against
the Company with respect to current or future products or services, or that, if
such actions are brought, the Company will ultimately prevail. Any such claiming
parties may have significantly greater resources than the Company to pursue
litigation of such claims. Any such claims, whether with or without merit, could
be time consuming, result in costly litigation, cause delays in introducing new
or improved services, require the Company to enter into royalty or licensing
agreements or cause the Company to discontinue use of the challenged tradename,
service mark or technology at potentially significant expense to the Company
associated with the marketing of a new name or the development or purchase of
replacement technology, any of which results could have a material adverse
effect on the Company.

DEPENDENCE UPON SOFTWARE. The software developed and utilized by the
Company in providing its services may contain undetected errors. Although the
Company engages in extensive testing of its software prior to introducing the
software onto its network, there can be no assurance that errors will not be
found in software after commencement of use of such software. Any such error may
result in partial or total failure of the Company's network, additional and
unexpected expenses to fund further product development or to add programming
personnel to complete a development project, and loss of revenue because of the
inability of subscribers to use the Company's network or the cancellation by
subscribers of their service with the Company, any of which could have a
material adverse effect on the Company.

DEPENDENCE UPON TELECOMMUNICATIONS PROVIDERS, SPECIFICALLY MCI AND
INTERACT, INC. The Company does not own a transmission network and, accordingly,
depends on MCI for transmission of its subscribers' long distance calls. For the

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year ended August 31, 1998, MCI was responsible for carrying traffic
representing virtually all of the minutes of long distance transmissions billed
to the Company. Further, the Company is dependent upon LECs for call origination
and termination. If there is an outage affecting the Company's terminating
carriers, the Company's call processing platform may not complete a call. The
Company has not experienced significant losses in the past because of
interruptions of service at terminating carriers, but no assurance can be made
in this regard with respect to the future integrity of such carriers. The
Company's ability to maintain and expand its business depends, in part, on its
ability to continue to obtain telecommunications services on favorable terms
from a long distance carrier and the cooperation of both interexchange and LECs
in originating and terminating service for its subscribers in a timely and
effective manner. A partial or total failure of the Company's ability to receive
or terminate calls would result in a loss of revenues by the Company and could
lead to a loss of subscribers, either of which could have a material adverse
effect on the Company.

The Company obtains virtually all of its long distance telecommunications
services pursuant to supply agreements with Interact, Inc. of Lincoln, Nebraska,
and, to a lesser extent, with MCI. No assurance can be given that the Company
will be able to obtain long distance services in the future at favorable prices
or at all, and the unavailability of long distance services to the Company, or a
material increase in the price at which the Company is able to obtain long
distance service, would have a material adverse effect on the Company's
business, financial condition and results of operations. The Company is not
currently a party to a long distance telecommunications services agreement that
requires the Company to purchase a minimum amount of service each month.
However, the Company may in the future determine that it is desirable to enter
into agreements containing minimum purchase requirements. No assurance can be
given that demand for services in the areas covered by the Company's
transmission suppliers will exceed any minimum purchase requirement in the
future. To the extent the Company is unable to generate revenues sufficient to
offset minimum purchase requirements or other expenses, its financial condition
would be materially adversely affected.

POTENTIAL ADVERSE EFFECTS OF REGULATION. Various regulatory factors may
have an impact on the Company's ability to compete and on its financial
performance. The Company is subject to regulation by the FCC and by various
state public service and public utility commissions. Federal and state
regulations and regulatory trends have had, and may have in the future, both
positive and negative effects on the Company and on the information and
telecommunications service industries as a whole. FCC policy currently requires
interexchange carriers to provide resale of the use of their transmission
facilities. The FCC also requires LECs to provide all interexchange carriers
with equal access to the origination and termination of calls. If either or both
of these requirements were removed, the Company's access to these services could
be severely limited or available only on commercially unfavorable terms,
resulting in a material adverse impact to its business and results of
operations. These carriers may experience disruptions in service due to factors
outside the Company's control, which may cause the Company to lose the ability
to complete its subscribers' long distance calls.

The Company believes it has made all required filings with the FCC
necessary to allow the Company to provide interstate and international long

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<PAGE>

distance service. In order to provide intrastate long distance service, the
Company is required to obtain certification to provide telecommunications
services from the public service or public utility commissions of each state, or
to register or be found exempt from registration by such commissions. The
Company has not yet made any filings or taken any actions to become certified or
tariffed to provide intrastate card services to customers throughout the United
States. To date, the Company has not been denied any licenses or tariffs.

On February 8, 1996, President Clinton signed into law the
Telecommunications Act of 1996 which will allow LECs, including the RBOCs, to
provide inter-LATA long distance telephone service and which also grants the FCC
authority to deregulate other aspects of the telecommunications industry. To
date, such deregulation has resulted in significant amounts of industry
litigation, uncertainty and confusion. Such legislation may result in increased
competition for the Company from others, including RBOCs, and increased
transmission costs in the future. See "-- Competition" above. In conducting
various aspects of its business, the Company is subject to various laws and
regulations relating to commercial transactions generally, such as the Uniform
Commercial Code, and is also subject to the electronic funds transfer
regulations embodied in Regulation E promulgated by the Board of Governors of
the Federal Reserve System ("Federal Reserve"). Given the expansion of the
electronic commerce market, the Federal Reserve might revise Regulation E or
adopt new rules for electronic funds transfer affecting users other than
consumers. Congress has held hearings on whether to regulate providers of
services and transactions in the electronic commerce market, and it is possible
that Congress or individual states could enact laws regulating the electronic
commerce market. If enacted, such laws, rules and regulations could directly
regulate the Company's business and industry and could have a material adverse
effect on the Company's business, operating results and financial condition.

RISK OF LOSS FROM RETURNED TRANSACTIONS, FRAUD, BAD DEBT, THEFT OF
SERVICES. The Company utilizes Intrust Bank, N.A. financial payment clearance
systems for electronic fund transfers and ICVerify software for electronic
credit card settlement. In its use of these established payment clearance
systems, the Company generally bears the same credit risks normally assumed by
other users of these systems arising from returned transactions caused by
insufficient funds, stop payment orders, closed accounts, frozen accounts,
unauthorized use disputes, theft or fraud. From time to time, persons may be
able to gain unauthorized access to the Company's network and obtain services
without rendering payment to the Company by unlawfully utilizing the access
numbers and personal identification numbers ("PINs") of authorized users.
Although to date the Company has not experienced material losses due to such
unauthorized use of access numbers and PINs, no assurance can be given that
future losses due to unauthorized use will not be material. The Company
currently seeks to manage these risks through its internal controls and
proprietary billing system. The Company's call processing platform prohibits a
single access number and PIN from establishing multiple simultaneous connections
to the network system, and the Company establishes preset spending limits for
each subscriber. Past experience in estimating these risks and the Company's
historical losses are not necessarily accurate indications of the Company's
future losses. Although the Company believes that its risk management practices
and bad debt reserves are adequate, there can be no assurance that the Company's
risk management practices or reserves will be sufficient to protect the Company
from unauthorized or returned transactions or thefts of services which could

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<PAGE>

have a material adverse effect on the Company's business, operating results and
financial condition. Recently, a significant customer of the Company has become
seriously in arrears in its payment for international long distance services.
The Company believes it will be able to recover these monies owed; however,
there can be no assurances that the Company will be successful nor that this
will be the only customer that defaults on monies owed to the Company.

POTENTIAL ACQUISITIONS. The Company may in the future pursue acquisitions
of complementary services, products, technologies or businesses. Future
acquisitions may result in potentially dilutive issuances of equity securities,
the incurrence of additional debt, the write-off of software development costs,
and the amortization of expenses related to goodwill and other intangible
assets, all of which could have a material adverse effect on the Company's
business, operating results and financial condition. Future acquisitions would
involve numerous additional risks, including those related to the assimilation
of the operations, services, products and personnel of the acquired company, the
diversion of management's attention from other business concerns, the entry into
markets in which the Company has little or no direct prior experience and the
potential loss of key employees of the acquired company. Other than the Merger
Agreement with DCI, the Company currently has no binding agreements or
understandings with regard to any potential acquisitions.

NEED FOR ADDITIONAL FINANCING. The Company has significant cash
requirements in connection with its business. To date, the Company has been
unable to generate sufficient revenues to recover its costs. See "--Limited
Operating History" and "--Previous Losses" above. In addition to its working
capital requirements, the Company must fund the production and marketing of its
products prior to the time the products are made available for sale and generate
revenues. The Company's potential receipt of revenues from product sales are
subject to substantial contingencies, and there can be no assurances concerning
the timing and amount of future revenues from product sales. Additionally, the
Company may not receive payment from its customers until a period after products
are sold to end-users. The Company does not currently have any commitments to
provide financing and there can be no assurance that it will be able to obtain
such financing on favorable terms when needed.

The Company may be required to seek additional financing in the event of
delays, cost overruns or unanticipated expenses associated with a company in an
early stage of operations, or in the event the Company does not realize
anticipated revenues. In addition, the Company may require additional financing
in the future to further expand its product offerings or to make strategic
acquisitions. There can be no assurance that such additional financing will be
available, or that, if available, such financing will be obtainable on terms
favorable to the Company or its Stockholders. The Company currently has no
commitment for any such financing and in the event such necessary financing is
not obtained, the Company's operations will be materially adversely affected and
the Company will have to cease or substantially reduce operations. Any
additional equity financings may be dilutive to stockholders, and debt
financings, if available, may involve restrictive covenants, including limiting
the Company's ability to incur additional debt.

Although the Company believes it has sufficient capital resources to
maintain its currently limited operations for the remainder of this fiscal year,
it lacks the resources necessary to properly market its products or expand its
customer base. As a result, it may be unable to achieve a net profit from its
operations.

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NASDAQ LISTING AND MAINTENANCE REQUIREMENTS. The Company's Common Stock is
currently listed on the Nasdaq SmallCap Market ("Nasdaq"). Under the rules for
continued inclusion in the Nasdaq system, the Company is required to maintain at
least $2,000,000 in net tangible assets or $35,000,000 in market capitalization,
two market-makers, a public float of at least 500,000 shares and a minimum bid
price of $1.00 per share, as well as satisfy certain corporate governance
criteria. The Company's failure to meet one or more of the financial or
corporate governance criteria to which it is subject could result in its Common
Stock being delisted from Nasdaq. Upon notice of a deficiency in one or more of
the Nasdaq listing and maintenance requirements, the Company would be given a
period of between 10 to 90 days (depending upon the criteria) to comply with the
maintenance standards. See " -- Risk of Delisting" above.

RISK OF LOW-PRICED STOCK. If the Company's securities were delisted from
Nasdaq (See "--Risk of Delisting" above), they could become subject to Rule
15g-9 under the Exchange Act, which imposes additional sales practice
requirements on broker-dealers which sell such securities to persons other than
established customers and "accredited investors" (generally, individuals with
net worth in excess of $1,000,000 or annual incomes exceeding $200,000, or
$300,000 together with their spouses). For transactions covered by this rule, a
broker-dealer must make a special suitability determination for the purchaser
and have received the purchaser's written consent to the transaction prior to
sale. Consequently, such rule may adversely affect the ability of broker-dealers
to sell the Company's securities and may adversely affect the ability of the
Company's stockholders to make resales of the Common Stock.

PENNY STOCK REGULATIONS. The Commission adopted regulations which generally
define a "penny stock" to be any non-Nasdaq equity security that has a market
price (as therein defined) of less than $5.00 per share or with an exercise
price of less than $5.00 per share, subject to certain exceptions. For any
transaction involving a penny stock, unless exempt, the rules require delivery,
prior to any such transaction, of a disclosure schedule prepared by the SEC
relating to the penny stock market. Disclosure is also required to be made about
commissions payable to both the broker-dealer and the registered representative
and current quotations for the securities. Finally, monthly statements are
required to be sent disclosing recent price information for the penny stock held
in the account and information on the limited market in penny stocks.

The foregoing required penny stock restrictions will not apply to the
Company's securities if such securities are listed on Nasdaq and have certain
price and volume information provided on a current and continuing basis or meet
certain minimum net tangible assets or average revenue criteria. There can be no
assurance that the Company's securities will qualify for exemption from these
restrictions. In any event, even if the Company's securities were exempt from
such restrictions, the Company would remain subject to Section 15(b)(6) of the
Exchange Act, which gives the SEC the authority to prohibit any person that is
engaged in unlawful conduct while participating in a distribution of a penny
stock from associating with a broker-dealer or participating in a distribution
of a penny stock, if the SEC finds that such a restriction would be in the
public interest.

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<PAGE>

If the Company's securities were subject to the existing or proposed rules
on penny stocks, the market liquidity for the Company's securities could be
severely adversely affected.

RISKS ASSOCIATED WITH YEAR 2000. Many computer programs were designed to
recognize calendar years by their last two digits. As a result, such programs
are expected to misidentify dates commencing in calendar year 2000. This problem
is referred to as the "Year 2000 Issue." These errors are likely to lead to
computer errors, miscalculations, delays and business interruptions if not
properly corrected in a timely manner. The Company's main billing program was
originally written to accept dates from the year 2000 and beyond. However, the
Company plans on having an independent consultant review the billing system for
the purpose of thoroughly testing its operation for readiness associated with
the Year 2000 Issue. Estimated costs for the consultant and associated testing
activities is $700. The Company anticipates that such assessment activities will
be completed by March 31, 1999. The Company has completed an assessment of all
other internal systems and has determined that no modifications to such systems
are necessary. Total costs incurred to date by the Company in connection with
its assessment of its internal vulnerability to the Year 2000 Issue equal
approximately $5,000.

The Company has also contacted its major supplier, which handles the call
processing software and supports platform services. The Company's call
processing hardware and operating systems are not currently able to address the
Year 2000 Issue. Modifications to this system have begun and the host server's
operating system is expected to be compliant no later than the end of the first
quarter of calendar year 1999. The Company currently estimates that its costs to
be incurred with such modification will be approximately $50,000. The Company
does not have material relationships with any other third partners upon which
its business and operations are substantially dependent. However, it intends to
seek assurances from any third parties with which it enters into agreements in
the future that the systems are compliant with the Year 2000 Issue.

Presently, the Company does not have a contingency plan in the event it is
unable to correct any vulnerability to the Year 2000 Issue, but is reviewing
alternatives, such as using a service bureau to temporarily process calls and
run applications, should any problems arise in system operations.

The Company believes there exist multiple alternative suppliers for these
services. However, if it is unable to obtain such services and at terms
acceptable to it, it may be forced to interrupt or suspend its services. In
addition, even if available, the Company may be required to incur substantially
higher costs in order to provide such services. The Company has adequate
resources to complete its Year 2000 assessment and any necessary modifications.

USE OF PROCEEDS

The net proceeds from the sale of the Offered Securities will be received
directly by the Selling Shareholders. No proceeds will be received by the
Company from the sale of the Offered Securities, although the Company will

22
<PAGE>

receive up to an aggregate of $318,250.00 of gross proceeds upon exercise of
outstanding warrants to purchase 265,000 shares of Common Stock, all of which
are included in the Offered Securities. The Company intends to use such
proceeds, if any, for its general corporate purposes.

DETERMINATION OF OFFERING PRICE

23
<PAGE>

SELLING SHAREHOLDERS

The following table provides certain information with respect to the Common
Stock beneficially owned by each Selling Shareholder as of November 23, 1998.
Except as set forth below, none of such Selling Shareholders has had a material
relationship with the Company other than as a result of ownership of the
securities of the Company. The Offered Securities may be offered from time to
time by the Selling Shareholders named below or their nominees, and this
Prospectus may be required to be delivered by persons who may be deemed to be
underwriters in connection with the offer or sale of such securities. Because
(i) the Selling Shareholders may offer all or some of the Offered Securities
held by them pursuant to offerings contemplated by this Prospectus, (ii) the
Offered Securities are not necessarily being underwritten on a firm commitment
basis and (iii) the Selling Shareholders may purchase additional shares of
Common Stock or Common Stock equivalents from time to time, the Company cannot
accurately estimate the amount of shares of Common Stock to be held by the
Selling Shareholders after completion of the offerings contemplated by this
Prospectus. The following table assumes that each Selling Shareholder will sell
all Offered Securities, which may not be the case.

[The rest of this page left blank intentionally]

24
<PAGE>

<TABLE>
<CAPTION>
Shares Beneficially Owned Shares Beneficially Owned
Prior to the Offering Number of After the Offering
------------------------- Shares -------------------------
Percent of Offered Percent of
Total Shares --------- Total Shares
Name Number Outstanding Number Outstanding
- ---- ------ ------------ ------ ------------
<S> <C> <C> <C> <C> <C>
Pro Futures Special Equities Fund,
L.P. ................................ 2,750,000(1) 13.9% 2,750,000(1) 0 0%
Berkshire International ............... 150,000(2) * 150,000(2) 0 0%
Mike Abraham .......................... 31,329 * 31,329 0 0%
John J. and Diane Banks ............... 10,000 * 10,000 0 0%
Diane Banks ........................... 7,832 * 7,832 0 0%
William Dale .......................... 148,812 * 148,812 0 0%
Mildred Geiss ......................... 62,657 * 62,657 0 0%
Michael Jay Green ..................... 7,832 * 7,832 0 0%
David Spring .......................... 7,832 * 7,832 0 0%
Morgan E. North ....................... 78,322 * 78,322 0 0%
Paul E. Ruecker ....................... 10,000 * 10,000 0 0%
Herman O. Haenert ..................... 15,664 * 15,664 0 0%
Gerald Quinn .......................... 1,337,230(3) 7.5% 333,593 1,003,637(3) 5.6%
Robert Caylor ......................... 175,714(4) 1% 175,714(4) 0 0%
Frances and Barbara Prevedello ........ 309,238(5) 1.8% 309,238(5) 0 0%
Maureen Pocock ........................ 215,667(6) 1.3% 215,667(6) 0 0%
Andrew Pocock ......................... 92,429(7) * 92,429(7) 0 0%
CTC,Inc ............................... 30,000(8) * 30,000(8) 0 0%
Vikram Grover ......................... 20,000(9) * 20,000(9) 0 0%
--------- ---------
Total 4,456,921 4,456,921
</TABLE>
- -----------------
* Less than 1%
(1) Represents aggregate number of common shares reserved for issuance to the
Selling Shareholder upon exercise of convertible preferred shares. Actual
number of common shares to be offered by the Selling Shareholder upon
conversion will be determined in accordance with the Certificate of
Designation.
(2) All of these shares are issuable to the Selling Shareholder upon exercise
of outstanding Warrants, at a price of $1.75 per share.
(3) Includes 800,000 shares issuable upon exercise of outstanding options.
(4) Includes 25,000 shares issuable to the Selling Shareholder upon exercise of
outstanding Warrants, at a price of $0.44 per share.
(5) Includes 20,000 shares issuable to the Selling Shareholder upon exercise of
outstanding Warrants, at a price of $0.46 per share.
(6) Includes 14,000 shares issuable to the Selling Shareholder upon exercise of
outstanding Warrants, at a price of $0.46 per share.
(7) Includes 6,000 shares issuable to the Selling Shareholder upon exercise of
outstanding Warrants, at a price of $0.46 per share.
(8) Includes 30,000 shares issuable to the Selling Shareholder upon exercise of
outstanding Warrants, at a price of $0.625 per share.
(9) Includes 20,000 shares issuable to the Selling Shareholder upon exercise of
outstanding Warrants, at a price of $0.38 per share.

25
<PAGE>

PLAN OF DISTRIBUTION

The Offered Securities may be sold from time to time by the Selling
Shareholders, or by pledgees, donees, transferees or other successors in
interest. Such sales may be made in the over-the-counter market, in negotiated
transactions, a combination of such methods of sale, or otherwise. The Offered
Securities may be sold by one or more of the following: (a) a block trade in
which the broker-dealer so engaged will attempt to sell the Offered Securities
as agent but may position and resell a portion of the block as principal to
facilitate the transaction; (b) purchases by a broker-dealer as principal and
resale by such broker-dealer for its account pursuant to this Prospectus; (c) an
exchange distribution in accordance with the rules of such exchange; and (d)
ordinary brokerage transactions and transactions in which the broker solicits
purchasers. In effecting sales, broker-dealers engaged by the Selling
Shareholders may arrange for other broker-dealers to participate in the resales.
Sales may be made at fixed prices which may be changed, at market prices
prevailing at the time of sale, or at negotiated prices.

In connection with distributions of the Offered Securities or otherwise,
the Selling Shareholders may enter into hedging transactions with
broker-dealers. In connection with such transactions, broker-dealers may engage
in short sales of the Offered Securities in the course of hedging the positions
they assume with Selling Shareholders. The Selling Shareholders may also sell
Offered Securities short and redeliver the Offered Securities to close out such
short positions. The Selling Shareholders may also enter into option or other
transactions with broker-dealers which require the delivery to the broker-dealer
of the Offered Securities, which the broker-dealer may resell or otherwise
transfer pursuant to this Prospectus. The Selling Shareholders may also loan or
pledge Offered Securities to a broker-dealer and the broker-dealer may sell the
Offered Securities so loaned or, upon a default, the broker-dealer may effect
sales of the pledged Offered Securities pursuant to this Prospectus.

Selling Shareholders may effect such transactions by selling their
securities directly to purchasers, through broker-dealers acting as agents for
the Selling Shareholders or to broker-dealers who may purchase securities as
principals and thereafter sell the securities from time to time in the
over-the-counter market, in negotiated transactions or a combination of such
methods of sale. Such broker-dealers, if any, may receive compensation in the
form of discounts, concessions or commissions from the Selling Shareholders
and/or the purchasers for whom such broker-dealers act as agents or to whom they
may sell as principals or otherwise (which compensation as to a particular
broker-dealer may exceed customary commissions). In addition, any securities
covered by this Prospectus which qualify for sale pursuant to Rule 144 may be
sold under Rule 144 rather than pursuant to this Prospectus.

Under the applicable rules and regulations under the Exchange Act, any
person engaged in the distribution of the Selling Shareholders' Warrants may not
simultaneously engage in market-making activities with respect to any securities
of the Company for a period of up to five business days prior to the
commencement of such distribution. In addition, each Selling Shareholders
desiring to sell Warrants will be subject to the applicable provisions of the

26
<PAGE>

Exchange Act and the rules and regulations thereunder, including without
limitation, Regulation M, which provisions may limit the timing of the purchases
and sales of shares of the Company's securities by such Selling Shareholders.

The Selling Shareholders and broker-dealers, if any, acting in connection
with such sales might be deemed to be "underwriters" within the meaning of
Section 2(11) of the Securities Act, and any commission received by them and any
profit on the resale of the securities might be deemed to be underwriting
discounts and commissions under the Securities Act.

All costs, expenses and fees in connection with the registration of the
shares will be borne by the Company. Commissions and discounts, if any,
attributable to the sales of the Offered Securities will be borne by the Selling
Shareholders.

INDEMNIFICATION AND LIMITATION OF LIABILITY. The Company and the Selling
Shareholders have agreed to indemnify each other, and certain additional persons
including broker-dealers or agents, against certain liabilities in connection
with the offering of the Offered Securities, including liabilities arising under
the Securities Act. Additionally, the Company has adopted provisions in its
Articles of Incorporation and Bylaws that eliminate, to the fullest extent
available under Nevada law, the personal liability of its officers and directors
to the Company or its stockholders, including liabilities under the Securities
Act. Insofar as indemnification for liabilities arising under the Securities Act
may be permitted to directors, officers or persons controlling the Company, the
Company has been informed that in the opinion of the Commission such
indemnification is against public policy as expressed in the Securities Act and
is, therefore, unenforceable.

EXPERTS

The financial statements of the Company as of August 31, 1998, and for each
of the years in the three-year period ended August 31, 1998, have been
incorporated by reference herein and in the registration statement in reliance
upon the report of Addison, Roberts & Ludwig, P.C., independent certified public
accountants, incorporated by reference herein, and upon the authority of said
firm as experts in accounting and auditing.

LEGAL MATTERS

The legality of the securities offered hereby has been passed upon for the
Company by Squire, Sanders & Dempsey L.L.P., Phoenix, Arizona.

27
<PAGE>

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

NO PERSON HAS BEEN AUTHORIZED TO GIVE
ANY INFORMATION OR TO MAKE ANY
REPRESENTATIONS OTHER THAN THOSE
CONTAINED IN THIS PROSPECTUS OR ANY
RELATED PROSPECTUS SUPPLEMENT AND, IF
GIVEN OR MADE, SUCH INFORMATION OR
REPRESENTATIONS MUST NOT BE RELIED
UPON AS HAVING BEEN AUTHORIZED.
NEITHER THIS PROSPECTUS NOR ANY
PROSPECTUS SUPPLEMENT CONSTITUTES AN
OFFER TO SELL OR THE SOLICITATION OF
AN OFFER TO BUY ANY SECURITIES OTHER WAVETECH INTERNATIONAL, INC.
THAN THE SECURITIES DESCRIBED IN THIS
PROSPECTUS AND RELATED PROSPECTUS
SUPPLEMENT OR AN OFFER TO SELL OR THE
SOLICITATION OF AN OFFER TO BUY SUCH
SECURITIES IN ANY CIRCUMSTANCES IN
WHICH SUCH OFFER OR SOLICITATION IS
UNLAWFUL. NEITHER THE DELIVERY OF
THIS PROSPECTUS OR ANY RELATED
PROSPECTUS SUPPLEMENT NOR ANY SALE
MADE HEREUNDER SHALL, UNDER ANY
CIRCUMSTANCES, CREATE ANY IMPLICATION
THAT THERE HAS BEEN NO CHANGE IN THE
AFFAIRS OF THE COMPANY SINCE THE DATE
HEREOF OR THAT THE INFORMATION
CONTAINED HEREIN OR THEREIN IS CORRECT
AS OF ANY TIME SUBSEQUENT TO ITS DATE.

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

PROSPECTUS

---------------------------
TABLE OF CONTENTS

Page

Available Information............. 2
Incorporation of Certain
Documents by Reference.......... 3 4,456,921 Shares
Prospectus Summary................ 4 of Common Stock
Risk Factors...................... 10
Use of Proceeds................... 22
Determination of Offering Price... 23
Selling Shareholders.............. 24
Plan of Distribution.............. 26
Experts........................... 27
Legal Matters..................... 27

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

<PAGE>

PART II

INFORMATION NOT REQUIRED IN PROSPECTUS

ITEM 14. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION.

The estimated expenses in connection with the issuance and distribution of
the securities being registered, other than underwriting compensation, are as
follows:

SEC registration fee.......................................$ 328.70
Legal fees and disbursements...............................$2,500.00
Accounting fees and disbursements..........................$2,500.00
Blue Sky fees and expenses.................................$ 0.00
Transfer Agent Fees........................................$ 250.00
Miscellaneous..............................................$ 422.30
---------
Total..................................................$6,000.00

The foregoing expenses will be borne by the Company.

ITEM 15. INDEMNIFICATION OF DIRECTORS AND OFFICERS.

Article XV of the Company's Bylaws, provides as follows: The corporation
shall indemnify each of its directors and officers who was or is a party or is
threatened to be made a party to any threatened, pending or completed action,
suit or proceeding, whether civil, criminal, administrative or investigative
(other than an action by or in the right of the Company) by reason of the fact
that he is or was a director or officer of the Company or is or was serving at
the request of the Company as a director, officer, employee or agent of another
corporation, partnership, joint venture, trust or other enterprise, against
expenses (including attorneys' fees), judgments, fines and amounts paid in
settlement actually and reasonably incurred by him in connection with such
action, suit or proceeding if he acted in good faith and in a manner he
reasonably believed to be in or not opposed to the best interests of the
Company, and with respect to any criminal action or proceeding, had no
reasonable cause to believe his conduct was unlawful.

Except as provided herein below, any such indemnification shall be made by
the Company only as authorized in the specific case upon a determination that
indemnification of the director or officer is proper in the circumstances
because he has met the applicable standard of conduct set forth above. Such
determination shall be made: (a) by the Board of Directors by a majority vote of
a quorum of directors who were or are not parties to such action, suit or
proceeding, or (b) by the shareholders.

Expenses (including attorneys' fees) incurred in defending a civil or
criminal action, suit or proceeding may be paid by the Company in advance of the

II-1
<PAGE>

final disposition of such action or proceeding, if authorized by the Board of
Directors and upon receipt of an undertaking by or on behalf of the director or
officer to repay such amount unless it shall ultimately be determined that he is
entitled to be indemnified by the Company.

To the extent that a director or officer has been successful on the merits
or otherwise in defense of any action, suit or proceeding referred to above, or
in defense of any claim, issue or matter therein, he shall be indemnified
against expenses (including attorneys' fees) actually and reasonably incurred by
him in connection therewith, without any further determination that he has met
the applicable standard of conduct set forth above.

Insofar as indemnification for liabilities arising under the Securities Act
may be permitted to directors, officers or persons controlling the Company, the
Company has been informed that in the opinion of the Commission such
indemnification is against public policy as expressed in the Securities Act and
is therefore unenforceable.

ITEM 16. EXHIBITS.

Number Description Method of Filing
- ------ ----------- ----------------

5 Opinion of Squire, Sanders & Dempsey L.L.P. (1)
23 Consent of Addison, Roberts & Ludwig, P.C. (2)
24 Power of Attorney (1)
- --------------

(1) Previously filed.
(2) Filed herewith.

II-2
<PAGE>

ITEM 17. UNDERTAKINGS.

The undersigned registrant hereby undertakes:

(1) To file, during any period in which it offers or sells securities, a
post-effective amendment to this registration statement;

(i) To include any prospectus required by Section 10(a)(3) of the
Securities Act of 1933, as amended (the "Securities Act").

(ii) To reflect in the prospectus any facts or events arising after
the effective date of the registration statement (or the most
recent post-effective amendment thereof) which, individually or
in the aggregate, represent a fundamental change in the
information set forth in the registration statement; and
notwithstanding the foregoing, any increase or decrease in
volume of securities offered (if the total dollar value of
securities offered would not exceed that which was registered)
and any deviation from the low or high end of the estimated
maximum offering range may be reflected in the form of
prospectus filed with the Commission pursuant to Rule 424(b) if,
in the aggregate, the changes in the volume and price represent
no more than a 20 percent change in the maximum aggregate
offering price set forth in the "Calculation of Registration
Fee" table in the effective registration statement.

(iii) To include any material information with respect to the plan of
distribution not previously disclosed in the registration
statement or any material change to such information in the
registration statement;

PROVIDED, HOWEVER, that paragraphs (1)(i) and (1)(ii) do not apply if the
information required to be included in a post-effective amendment by those
paragraphs is contained in periodic reports filed by the registrant pursuant to
Section 13 or 15(d) of the Securities Exchange Act of 1934, as amended (the
"Exchange Act"), that are incorporated by reference in the registration
statement.

(2) That, for the purpose of determining any liability under the
Securities Act, each such post-effective amendment shall be deemed to
be a new registration statement relating to the securities offered
therein, and the offering of such securities at that time shall be
deemed to be the initial bona fide offering thereof.

(3) To remove from registration by means of a post-effective amendment any
of the securities being registered which remain unsold at the
termination of the offering.

(4) In the event that a claim for indemnification against liabilities
arising under the Securities Act (other than the payment by the small
business issuer of expenses incurred or paid by a director, officer or

II-3
<PAGE>

controlling person of the registrant in the successful defense of any
action, suit or proceeding) is asserted by such director, officer or
controlling person in connection with the securities being registered,
the registrant will, unless in the opinion of its counsel the matter
has been settled by controlling precedent, submit to a court of
appropriate jurisdiction the question whether such indemnification is
against public policy as expressed in the Securities Act and will be
governed by the final adjudication of such issue.

Insofar as indemnification for liabilities arising under the
Securities Act may be permitted to directors, officers or persons
controlling the Company, the Company has been informed that in the
opinion of the Commission such indemnification is against public
policy as expressed in the Securities Act and is therefore
unenforceable.

(5) That, for purposes of determining any liability under the Securities
Act, each filing of the Company's annual report pursuant to Section
13(a) or 15(d) of the Exchange Act (and, where applicable, each filing
of an employee benefit plan's annual report pursuant to Section 15(d)
of the Exchange Act) that is incorporated by reference in the
registration statement relating to the securities offered hereby, and
the offering of such securities at that time shall be deemed to be the
initial bona fide offering thereof.

II-4

<PAGE>

SIGNATURES

Pursuant to the requirements of the Securities Act of 1933, Wavetech
International, Inc. certifies that it has reasonable grounds to believe that it
meets all of the requirements for filing on Form S-3 and has duly caused this
Amendment No. 1 to the Registration Statement on Form S-3 to be signed on its
behalf by the undersigned, thereunto duly authorized, in the City of Tucson and
State of Arizona on December 4, 1998.

WAVETECH INTERNATIONAL, INC.
a Nevada corporation

By /s/ Gerald I. Quinn
-------------------------------------
Gerald I. Quinn
President and Chief Executive Officer

Pursuant to the requirements of the Securities Act of 1933, this Amendment
No. 1 to the Registration Statement on Form S-3 has been signed below by the
following persons on behalf of the Registrant and in the capacities and on the
date indicated:

Signature Title Date
- --------- ----- ----

/s/ Gerald I. Quinn President, Chief Executive December 4, 1998
- --------------------------- Officer and Director
Gerald I. Quinn (Principal Executive
Officer)

* Chief Financial Officer December 4, 1998
- --------------------------- (Principal Financial and
Lydia M. Montoya Accounting Officer)

* Director December 4, 1998
- ---------------------------
Richard P. Freeman

* Director December 4, 1998
- ---------------------------
John P. Clements

*By: /s/ Gerald I. Quinn
-----------------------
Gerald I. Quinn
Attorney-in-Fact

S-1

EXHIBIT 23

[LETTERHEAD OF ADDISON, ROBERTS & LUDWIG, P.C.]

CONSENT OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANT

We hereby consent to the incorporation by reference in this Amended Registration
Statement on Form S-3, for this amendment number one and any further amendments,
of our report dated August 31, 1998, which appears in the annual report on Form
10-KSB/A of Wavetech International, Inc. (formerly Wavetech, Inc. and
Subsidiaries) for the year ended August 31, 1997, and to the reference to our
Firm under the caption "Experts" in the Prospectus.

/s/ Addison, Roberts & Ludwig, P.C.

Addison, Roberts & Ludwig, P.C.

Tucson, Arizona
December 4, 1998