SECURITIES AND EXCHANGE COMMISSION
                               WASHINGTON, D. C.


                                   FORM 10-Q


                  QUARTERLY REPORT UNDER SECTION 13 OR 15 (D)
                     OF THE SECURITIES EXCHANGE ACT OF 1934


FOR QUARTER ENDED:  March 31, 1997                    COMMISSION FILE NO. 0-4076
                   ---------------                                        ------



                              EXOTECH INCORPORATED
                              --------------------
               (Exact name of Registrant as Specified in Charter)





State or Jurisdiction of
Incorporation or Organization:                       DELAWARE

IRS Identification No:                               54-0700888

Address of Principal Office:                         8502 Dakota Drive
                                                     Gaithersburg, MD. 20877

Registrant's Telephone Number:                       (301) 948-3060




Indicate by checkmark  whether the Registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the  preceding 12 months (or for such  shorter  period that the  Registrant  was
required  to file  such  reports),  and  (2) has  been  subject  to such  filing
requirement for the past 90 days.

                           Yes      [x]              No      [ ]

Indicate the number of shares  outstanding  of each of the  issuer's  classes of
common stock, as of the close of the period covered by this Report.

CLASS:                                             COMMON STOCK, PAR VALUE $0.10
                                                   -----------------------------

OUTSTANDING AT
  March 31, 1997                            942,387
                                            -------


<PAGE>



                              EXOTECH INCORPORATED


                                     INDEX



PART I   FINANCIAL INFORMATION                                         PAGE NO.

         CONSOLIDATED CONDENSED BALANCE SHEET
         March 31, 1997  AND JUNE 30, 1996............................... 2

         CONSOLIDATED CONDENSED STATEMENT OF
         OPERATIONS - NINE MONTHS ENDED
         MARCH 31, 1997 AND 1996......................................... 3

         STATEMENT OF CASH FLOWS FOR NINE
         MONTHS ENDED MARCH 31, 1997 AND 1996............................ 4

         NOTES TO CONSOLIDATED CONDENSED
         FINANCIAL STATEMENTS............................................ 5

         MANAGEMENT'S DISCUSSION AND ANALYSIS
         OF CONSOLIDATED CONDENSED STATEMENT
         OF OPERATIONS................................................... 6


PART II  OTHER INFORMATION

         OTHER FINANCIAL INFORMATION................................... 7/8

         SIGNATURES...................................................... 9




<PAGE>



                              EXOTECH INCORPORATED
                           CONSOLIDATED BALANCE SHEET


<TABLE>
<CAPTION>
                                     ASSETS
                                     ------
                                                                   March 31,                          June 30,
                                                                     1997                               1996
                                                                 -----------                          --------
                                                                 (Unaudited)
<S><C>
CURRENT ASSETS

Accts. Receivable, Net                                         $    14,435                        $    11,073
Inventories
 Work in Process                                                   527,025                            505,062
 Raw Materials                                                      32,625                             32,625
 Finished Goods                                                     14,000                             14,000
Other Current Assets                                                    64                                344
Cash                                                                   375                                105
                                                               -----------                        -----------
Total Current Assets                                               588,524                            563,209

PROPERTY, PLANT AND EQUIPMENT
 NET                                                                   281                                411
OTHER NON-CURRENT ASSETS                                             6,225                              6,921
                                                               -----------                        -----------

TOTAL ASSETS                                                       595,030                            570,541
                                                               ===========                        ===========

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

Accts. Payable & Other Accrued Expenses                             95,364                            105,664
Other Current Liabilities                                          359,509                            347,994
Notes Payable                                                      382,094                            372,294
                                                               -----------                        -----------
Total Current Liabilities                                          836,967                            825,952

SHAREHOLDERS EQUITY
Common Stock, Par Value $.10 per share;
 1,500,000 shares authorized; 970,135
 issued; 942,387 outstanding                                        97,014                             97,014

Paid-in-Surplus                                                  1,169,645                          1,169,645
Deficit                                                         (1,396,176)                        (1,409,650)
Treasury Stock (27,748 shares)                                    (112,420)                          (112,420)
                                                               -----------                        -----------
Total Shareholders' Equity                                        (241,937)                          (255,411)

TOTAL LIABILITIES & SHAREHOLDERS'
 EQUITY                                                            595,030                            570,541
                                                               ===========                        ===========
</TABLE>

See accompanying Notes to Consolidated Condensed Financial Statements.

                                       2

<PAGE>




                              EXOTECH INCORPORATED
                 CONSOLIDATED CONDENSED STATEMENT OF OPERATIONS


<TABLE>
<CAPTION>
                                                 1997                                        1996
                                        -----------------------                     -----------------------

                                     3 Mos.                 9 Mos.               3 Mos.                 9 Mos.
                                     ----------- ENDED -----------               ----------- ENDED -----------
                                     3/31                     3/31               3/31                     3/31
<S><C>
REVENUE
-------
Contract Sales                       $137,171              $335,175             $101,659                $261,015

EXPENSES
--------
Direct Labor                            2,573                 7,909                  380                   1,973
Overhead                                6,054                16,122                4,924                  16,998
Materials                                 149                   533                   36                      36
Other Direct Costs                      5,000                 5,000                   --                      --
Travel                                  2,316                 2,316                   --                     848
General & Administrative                2,114                 3,110                  735                   2,307
Inventory Costs                       111,669               262,869               70,002                 234,836
                                     --------              --------             --------                --------

Cost of Contract Services             129,875               297,859               76,076                 256,997

Operating Income (Loss)                 7,296                37,316               25,583                   4,018

Miscellaneous Income                       --                    --                   --                      --
Research and Development                   --                    --                   --                 (88,100)
Interest & Other                       (8,771)              (23,700)              (6,548)                (19,786)
                                     --------              --------             --------                --------

NET INCOME BEFORE
  TAXES                                (1,475)               13,616               19,035                (103,868)
State Income Tax
 Provision                                 --                    --                   --                      --
                                     --------              --------             --------                --------
NET INCOME (LOSS)                      (1,475)               13,616               19,035                (103,868)

Weighted Average Number of
Common Shares
Outstanding                           942,387               942,387              942,387                 942,387

EARNINGS (LOSS) PER
COMMON SHARE                            (0.00)                 0.01                 0.02                   (0.11)

DIVIDENDS PER
 COMMON SHARE                            None                  None                 None                    None
</TABLE>

See accompanying Notes to Consolidated Condensed Financial Statements.
These statements have been prepared from the books of account without audit.

                                       3

<PAGE>




                      EXOTECH INCORPORATED AND SUBSIDIARY
                          STATEMENT OF CASH FLOWS FOR
                          NINE MONTHS ENDED MARCH 31,

                        --------------------------------
<TABLE>
<CAPTION>
                                                                                1997                       1996
                                                                                ----                       ----
<S><C>
CASH FLOWS FROM OPERATING TRANSACTIONS
--------------------------------------

Net Income (Loss)                                                               13,616                    (103,868)
Add: Non cash Income Determinants
     Depreciation and Amortization                                                 826                         863
Add (Deduct): Changes in Current Assets & Liabilities
     (Increase) Decrease in Accounts Receivable                                 (3,362)                      2,323
     (Increase) Decrease in Prepaid Expenses                                       280                         628
     (Increase) Decrease in Inventory                                          (21,963)                    (62,667)
     Increase (Decrease) in Accts. Payable                                     (10,300)                     41,244
     Increase (Decrease) in Payroll/Emp. Benefits                               (9,177)                     45,176
     Increase (Decrease) in Accrued Interest                                    20,550                      19,674
                                                                               -------                    --------

Cash Provided By or (Used) For Operating Transactions                           (9,530)                    (56,627)
     -----------    ----------

CASH FLOWS FROM FINANCING TRANSACTIONS:
---------------------------------------

Proceeds from Notes                                                             39,800                      57,719
Payments on Notes                                                              (30,000)                         --
                                                                               -------                    --------

Cash Provided By or (Used For) Financing Transactions                            9,800                      57,719

CASH FLOWS FROM INVESTING TRANSACTIONS:
---------------------------------------

Purchase of Equipment                                                               --                          --
Deposits                                                                            --                         128
                                                                               -------                    --------

Cash Provided By or (Used For) Investing Transactions                               --                         128
     -----------    ----------

INCREASE (DECREASE) IN CASH                                                        270                       1,200
---------------------------

CASH BALANCE - BEGINNING                                                           105                          32
------------------------                                                       -------                    --------
CASH BALANCE - ENDING                                                              375                      $1,252
                                                                               =======                    ========
</TABLE>


                                       4

<PAGE>



                              EXOTECH INCORPORATED
              NOTES TO CONSOLIDATED CONDENSED FINANCIAL STATEMENTS



NOTE 1.

In the opinion of Management,  the accompanying unaudited consolidated condensed
financial  statements  contain  all  adjustments   (consisting  of  only  normal
recurring  accruals)  necessary to present  fairly the financial  position as of
March 31, 1997 and June 30, 1996 and the  results of  operations  and changes in
financial  position for the nine months ended March 31, 1997 and 1996 of Exotech
Incorporated  and its inactive  wholly-owned  consolidated  subsidiary,  Exotech
Research & Analysis, Inc. There are no significant intercompany transactions.


NOTE 2.

Per  share   computations  have  been  based  on  the  weighted  average  shares
outstanding of 942,387 for the nine months ended March 31, 1997 and 1996.


NOTE 3.

Notes Payable at March 31, 1996 consist of four demand notes of $100,000, $8,000
and  $47,000,  payable with  interest at 8.5% per annum to one of the  Company's
present and two former  directors.  In addition,  one demand note of $227,094 is
payable with interest at 8.5% per annum to one  officer/employee.  Periodically,
the Company has  obtained  producer  loans from Spiral  Biotech,  Inc.  that are
secured by inventory instruments (bacteria colony counters).  At March 31, 1997,
there was no outstanding Producer Loan.

NOTE 4.

Inventory cost shown in the cost of sales,  represents the cost of production of
goods sold that were incurred in the prior fiscal year.


                                       5

<PAGE>



                      MANAGEMENT'S DISCUSSION AND ANALYSIS
                                     OF THE
                 CONSOLIDATED CONDENSED STATEMENT OF OPERATIONS


The following is  Management's  discussion  and analysis of certain  significant
factors which have affected the Company's  earnings during the periods  included
in the accompanying consolidated condensed statement of operations.

A summary of the period to period changes in the principal items included in the
consolidated statement of operations is shown below:


<TABLE>
<CAPTION>

                               ---------------------------------------- COMPARISON OF -----------------------------------------

                                       THREE MONTHS                      THREE MONTHS                       NINE MONTHS
                                 ----------------------           ------------------------           -----------------------
                                 Mar 31          Dec 31           Mar 31            Mar 31           Mar 31           Mar 31
                                  1997            1996             1997              1996             1997             1996
<S><C>
Net Sales                      137,171           87,208           137,171          101,659          335,175          261,015
Cost of Labor & Overhead         8,627           14,348             8,627            5,304           24,031           18,971
G&A Expense                      2,114              852             2,114              735            3,110            2,307
Inventory Cost                 111,669           52,488           111,669           70,002          262,869          234,836
                               -------           ------           -------           ------          -------          -------
Cost of Sales                  129,875           67,688           129,875           76,076          297,859          256,997
Interest & Other                 8,771            7,799             8,771            6,548           23,700           19,786
</TABLE>






                                       6


<PAGE>



                      PART II. OTHER FINANCIAL INFORMATION



ITEM 5.

As in the past,  a shortage of working  capital  continues  to be a  significant
problem,  resulting in occasional slow payments to creditors,  and hampering the
development  of new business to the fullest extent  possible.  In the opinion of
Management,  the Company should be in a position to sustain  operations at least
until such time as the results of current  contracts  and  negotiations  for new
business is determinable.  Ultimate realization of the carrying value of prepaid
expenses and advances,  property and equipment,  and miscellaneous  other assets
shown in the  accompanying  balance  sheet  depend on the effect of the  matters
discussed herein.

The dollar  amount of the backlog as of March 31, 1997 was  $265,500,  higher by
$112,500 compared to that of the prior year, and $95,100 higher than the backlog
at December 31, 1996.


ITEM 6 (B)

There  were no reports  filed on Form 8-K for the nine  months  ended  March 31,
1997.


                                       7

<PAGE>




I.        CHANGE IN FINANCIAL POSITION IN THE NINE MONTHS ENDED MARCH 31, 1997.
          ---------------------------------------------------------------------

          In the nine months  period  ended March 31,  1997,  a reduction of the
          working  capital  deficit of $14,300  resulted  from a net profit from
          operations  of $13,616 and non-fund  charges of $826.  Producer  loans
          totalling $30,000 - obtained from Spiral Biotech,  Inc. in this period
          were  paid-down  prior  to the  end of the  period.  Additional  loans
          amounting  to $9,800  obtained  from an  officer  of the  Company  are
          outstanding.

          An order received in March 1997 from Spiral  Biotech,  Inc.  increased
          backlog at the end of the period by $180,000 for instruments scheduled
          for deliveries beginning in June 1997.


II.       INCOME AND EXPENSE IN THE MOST RECENT QUARTER AND NINE MONTH
          ------------------------------------------------------------
          PERIOD AND THE SAME QUARTER AND NINE MONTHS PERIOD LAST YEAR.
          -------------------------------------------------------------

          Revenue for the quarter ended March 31, 1997, at $137,171, was $35,512
          higher compared to the same period one year earlier.  Operating income
          was $4,018  compared to $25,583 in the quarter  ended March 31,  1996.
          The earlier  period had  unusually  low costs related to completion of
          the costly  development of a production  version of a new product.  In
          the opinion of  Management,  the most recent  quarter  results  show a
          continuation  of modest  progress over the past three quarters  toward
          profitable  operations and recovery from the large losses  incurred in
          the prior year.

          For the nine months  period ended March 31, 1997,  revenue of $335,175
          was 28 percent higher than that achieved one year earlier. On the same
          basis of comparison, the cost of sales was higher by about 16 percent,
          resulting  in a net  profit of  $13,616  as  opposed to an net loss of
          $103,868 in the prior year.  These changes  reflect the return to more
          normal operating  conditions for the Company after an intense and very
          costly effort to develop a new product in the prior fiscal year.


                                       8

<PAGE>


                                   SIGNATURE


Pursuant to the requirements of the Securities Act of 1934, the Company has duly
caused this Report to be signed on its behalf by the undersigned  thereunto duly
authorized.



                                                          EXOTECH INCORPORATED

                                                                REGISTRANT




DATE:         May 14, 1997
     ----------------------------



/s/ Robert G. Lyle
-----------------------------------
ROBERT G. LYLE, PRESIDENT AND CHIEF
 EXECUTIVE OFFICER




                                       9