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

                                   FORM 10-QSB


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

                        For the quarterly period ended June 30, 1999

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

                        For the transition period from __________  to __________

                        Commission file number:  0-18271


                            MAGELLAN TECHNOLOGY, INC.
                    -----------------------------------------
             (Exact name of registrant as specified in its charter)


          Utah                                            87-0467614
---------------------------------           -----------------------------------
(State or other jurisdiction of             (I.R.S. Employer Identification No.)
 Incorporation or Organization)

13526 South 110 West
Draper, Utah                                                           84020
---------------------------------------                                -----
(Address of principal executive offices)                             (Zip Code)


Registrant's telephone number, including area code:   (801) 495-2211
                                                   ----------------------
Indicate by check mark whether the registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the  Securities  and  Exchange Act of 1934
during the preceding 12 months (or for such shorter  period that the  registrant
was  required  to file such  reports),  and (2) has been  subject to such filing
requirements for the past 90 days. Yes X No _____

Indicate the number of shares  outstanding  of each of the  issuer's  classes of
common stock, as of the latest practicable date:

                                                          Outstanding at
       Class                                               June 30, 1998
       -----                                             ------------------
Common Stock, $.0002 par value                            24,397,933 shares

<PAGE>


FORM 10-QSB

                       Financial Statements and Schedules
                            Magellan Technology, Inc.

                       For the Quarter Ended June 30, 1998

The  following  financial  statements  and schedules of the  registrant  and its
consolidated subsidiaries are submitted herewith:


                         PART I - FINANCIAL INFORMATION
                         ------------------------------
Item 1.           Financial Statements

                  Condensed consolidated balance sheet for June 30, 1999 and
                  year-end for December 31, 1999                               3

                  Condensed consolidated statement of operations for the
                  three months and six months ended June 30, 1999 and 1998     4

                  Condensed statement of cash flows for the six months
                  ended June 30, 1999 and 1998                                 5

                  Notes to condensed consolidated financial statements         7

Item 2.           Management's Discussion and Analysis of Financial
                  Condition and Results of Operations                          9


                           PART II - OTHER INFORMATION
                           ---------------------------
Item 1.           Legal Proceedings                                           12

Item 2.           Changes in Securities                                       12

Item 3.           Defaults upon Senior Securities                             12

Item 4.           Submission of Matters to a Vote of Security Holders         12

Item 5.           Other information                                           12

Item 6(a)         Exhibits                                                    12

Item 6(b)         Reports on Form 8-K                                         12

<PAGE>
                            MAGELLAN TECHNOLOGY, INC.
                                AND SUBSIDIARIES

                      Condensed Consolidated Balance Sheets
<TABLE>
<S>                                                                          <C>                 <C>


                                                                               June 30, 1999       Dec 31, 1998
                                    ASSETS                                      (Unaudited)          (Audited)
                                                                               -------------       -------------
Current Assets:
 Cash                                                                             $ 24,118           $ 159,108
 Accounts Receivable                                                               983,623             314,643
 Inventories                                                                       829,168             938,999
 Prepaid Expenses                                                                  109,700             133,489
 Other Current Assets                                                               58,476              38,741
                                                                               -------------       -------------
   Current Assets                                                                2,005,085           1,584,980
                                                                               -------------       -------------

 Property and Equipment, net                                                       876,609             938,351
 Goodwill, net                                                                     233,348             269,248
 Licenses & Technology, net                                                      1,268,359           1,283,594
                                                                               -------------       -------------
   Total Assets                                                                $ 4,383,401         $ 4,076,173
                                                                               =============       =============
                                 LIABILITIES

Current Liabilities:
 Accounts Payable                                                              $ 1,138,462         $ 1,131,037
 Accrued Personnel Costs                                                           145,921             122,706
 Accrued Liabilities                                                               238,836             186,718
 Accrued Interest Payable                                                          109,685              61,565
 Line of Credit                                                                  2,996,158           2,996,158
 Related Party Notes Payable                                                       790,000           1,840,000
 Notes Payable                                                                     670,694             355,212
 Current Portion of long-term debt                                                 372,554             312,015
                                                                               -------------       -------------
   Current Liabilities                                                           6,462,310           7,005,410

 Long-Term Debt                                                                    501,173             617,142
                                                                               -------------       -------------
   Total Liabilities                                                             6,963,483           7,622,553
                                                                               -------------       -------------
                             STOCKHOLDERS' EQUITY

 Common Stock, par value $.0002 per share;
 50,000,000 shares authorized, 24,397,933 shares
 issued and outstanding as of June 30, 1999.                                         4,880               3,545

 Additional Paid-in Capital                                                     12,274,235           9,890,575
 Unearned Compensation                                                            (100,627)           (130,868)
 Accumulated Deficit                                                           (13,309,632)         (8,380,223)
 Current Earnings/(Loss)                                                        (1,448,939)         (4,929,409)
                                                                               -------------       -------------
   Total Stockholders' equity                                                   (2,580,082)         (3,546,380)
                                                                               -------------       -------------
     Total Liabilities and Stockholders' Equity                                $ 4,383,401         $ 4,076,173
                                                                               =============       =============
<PAGE>

</TABLE>




                            MAGELLAN TECHNOLOGY, INC.
                                AND SUBSIDIARIES

                 Condensed Consolidated Statements of Operations
                                   (Unaudited)
<TABLE>
<S>                                                            <C>              <C>             <C>             <C>

                                                                          Three Months                      Six Months
                                                                          Ended June 30                    Ended June 30
                                                                     1999             1998            1999             1998
                                                                 -------------   -------------    -------------   -------------
 Net Sales                                                       $ 1,797,957        $ 735,969     $ 3,215,954        $ 978,586
 Cost of Sales                                                       322,484           92,280         552,484          136,439
                                                                 -------------   -------------    -------------   -------------
   Gross Margin                                                    1,475,473          643,689       2,663,470          842,147

 Variable Selling Costs                                              348,542          189,305         725,631          205,507
                                                                 -------------   -------------    -------------   -------------
   Contribution Margin                                             1,126,931          454,384       1,937,839          636,640

Operating Expenses:
 Administration                                                      257,044          359,218         334,400          647,149
 Customer Support                                                     69,457                          104,619
 Finance & Accounting                                                107,031          127,533         400,572          153,816
 Marketing                                                           203,203                          324,858
 R&D & Engineering                                                   229,838          322,116         399,898          642,772
 Sales - Domestic                                                    288,224          445,986         768,015          711,760
 Sales - International                                                86,792                          108,100
 Training & Education                                                212,015                          360,702
                                                                 -------------   -------------    -------------   -------------
    Total Operating Expenses                                       1,453,604        1,254,853       2,801,163        2,155,497
                                                                 -------------   -------------    -------------   -------------
 Income/(Loss) from Operations:                                     (326,673)        (800,469)       (863,324)      (1,518,857)

Other (Income)/Expense:
 Other Income                                                           (122)                            (452)
 Loss from Discontinued Operations
 (Gain)/Loss on Sale of Assets                                                              -               -                -
                                                                 -------------   -------------    -------------   -------------
 EBITDA                                                             (326,551)        (800,469)       (862,872)      (1,518,857)

 Depreciation Expense                                                 50,052           22,812          99,019           41,421
 Amortization of Licenses & Goodwill                                  97,637           31,136         191,759           49,169
 Interest Expense                                                    134,358          102,212         295,289          195,357
 Equity in Loss of Joint Venture                                                        4,852                            5,050
 (Gain) on sale of Joint Venture                                                     (180,023)                        (180,023)
                                                                 -------------   -------------    -------------   -------------
    Net Income/(Loss) before Taxes                                  (608,598)        (781,458)     (1,448,939)      (1,629,831)

 Provision for Income Taxes                                                                    -               -                -
                                                                 -------------   -------------    -------------   -------------
    Net Income/(Loss)                                             $ (608,598)      $ (781,458)   $ (1,448,939)    $ (1,629,831)
                                                                 =============   =============    =============   =============

    Net Income/(Loss) per share                                      $ (0.03)         $ (0.05)        $ (0.08)         $ (0.11)
                                                                 =============   =============    =============   =============

 Weighted average shares outstanding                              19,305,949       15,447,560      19,305,949       15,447,560
                                                                 =============   =============    =============   =============
</TABLE>
<PAGE>

                            MAGELLAN TECHNOLOGY, INC.
                                AND SUBSIDIARIES

                 Condensed Consolidated Statements of Cash Flows
                                   (Unaudited)
<TABLE>
<S>                                                                <C>              <C>

                                                                              Six Months
                                                                              Ended June 30
                                                                          1999             1998
Cash Flows from Operating Activities:                                -------------    -------------
 Net Income/(Loss)                                                  $ (1,448,939)     $ (1,629,831)
 Adjustments to Reconcile Net Income/(Loss)
   to Net Cash used in Operating Activities:
     Provision for Bad Debt                                                9,400
     Stock Compensation                                                   30,242           153,816
     Depreciation Expense                                                 99,019            41,421
     Amortization of Licenses & Goodwill                                 191,759            49,169
     Equity in Loss of Joint Venture                                           -             5,050
     (Gain) on Sale of Assets                                                  -          (180,023)
 (Increase)/Decrease in:
   Accounts Receivable                                                  (725,980)         (376,820)
   Inventory                                                             109,832          (939,038)
   Prepaid Expenses                                                       23,789
   Other Current Assets                                                  (19,735)          (79,527)

 Increase/(Decrease) in:
   Accounts Payable                                                       95,507           267,603
   Accrued Personnel Costs                                                23,215
   Accrued Liabilities                                                    52,118           163,163
   Accrued Interest Payable                                               59,153
                                                                     -------------    -------------
 Net Cash Provided by / (Used in) Operating Activities                (1,500,620)       (2,525,017)
                                                                     -------------    -------------
Cash Flows from Investing Activities:
 Purchase of Property & Equipment                                        (37,277)         (216,511)
 Acquisition of Digital Health
 Sale of Investment in Subsidiary                                                        1,500,000
                                                                     -------------    -------------
 Net Cash Provided by / (Used in) Investing Activities                   (37,277)        1,283,489
                                                                     -------------    -------------
Cash Flows from Financing Activities:
 Issuance of Common Stock                                                308,338
 Proceeds from Related Party Notes                                     1,195,000
 Principal Payments on Related Party Notes                              (345,000)
 Proceeds from Notes Payable                                             325,000
 Principal Payments on Notes Payable                                     (25,000)
 Proceeds from Line of Credit                                          1,382,122
 Principal Payments on Line of Credit
 Proceeds from Long-term Debt                                             18,798
 Principal Payments on Long-term Debt                                    (74,228)          (62,442)
                                                                     -------------    -------------
 Net Cash Provided by / (Used in) Financing Activities                 1,402,907         1,319,680
                                                                     -------------    -------------
 Net Decrease in cash                                                   (134,990)           78,152

 Cash, Beginning of Period                                               159,108           111,402
                                                                     -------------    -------------
 Cash, End of Period                                                    $ 24,118         $ 189,554
                                                                     =============    =============
</TABLE>
<PAGE>


                            MAGELLAN TECHNOLOGY, INC.
                                AND SUBSIDIARIES

                 Condensed Consolidated Statements of Cash Flows
                                   (Unaudited)
<TABLE>
<S>                                                                       <C>                   <C>
                                                                                        Six Months
                                                                                       Ended June 30
                                                                                 1999                 1998
Cash paid during the period for:                                            -------------        -------------

 Interest                                                                     $ 231,900              152,630
                                                                             =============        =============

 Income Taxes
                                                                             =============        =============

</TABLE>

Non-cash Financing and Investing Activities:

   During the quarter ended March 31, 1999, the Company converted  $1,900,000 of
 notes payable and $11,033 of accrued interest payable into common stock.

   During the quarter ended March 31, 1999, the Company issued 250,000 shares of
 common  stock in  exchange  for the rights to certain  technology  known as the
 P.I.C.E. Technology. The value of this transaction was $140,625.

   During the  quarter  ended  June 30,  1999,  the  Company  converted  certain
 accounts  payable  balances to certain  vendors to a note  payable.  The amount
 converted was $22,879.78.

   During the quarter  ended June 30,  1999,  the Company  converted an accounts
 payable  balance to a certain  vendor to common stock and a note  payable.  The
 amount converted was $25,000 and 39,313.03 respectively.

   During the  quarter  ended June 30,  1999,  the  Company  applied an accounts
 receivable  balance from a customer in the amount of $47,600 to the outstanding
 amount of a note payable to this same individual.

<PAGE>


                            MAGELLAN TECHNOLOGY, INC.
                                AND SUBSIDIARIES

              Notes to Condensed Consolidated Financial Statements

(1)           The unaudited condensed  consolidated financial statements include
              the accounts of Magellan  Technology,  Inc.  (The Company) and its
              wholly owned subsidiaries, BioMeridian Corporation [formerly known
              as  ProHealth,  Inc.  and prior to that known as  Satellite  Image
              Systems,  Inc. (SIS,  Inc.) and SIS Jamaica,  LTD (SIS  Jamaica)],
              SkyHook Technologies,  Inc. (SkyHook),  which the Company acquired
              effective  October 15, 1996, and BioMeridian  International,  Inc.
              (BioMeridian)  (formerly  known  as  BioSource,  Inc.)  which  the
              Company  acquired  effective  October 15, 1997. The acquisition of
              SkyHook  included  the  issuance of  4,874,936  shares of Magellan
              common stock and cash for all of the outstanding shares of SkyHook
              common  stock.  The  transaction  was  accounted for as a purchase
              transaction. The acquisition of BioSource included the issuance of
              225,000  shares of Magellan  common  stock and cash for all of the
              outstanding  shares of BioSource common stock. The transaction was
              accounted for as a purchase  transaction.  The Company  recognized
              goodwill of $358,997 in connection with the BioSource transaction.
              On August 1, 1996 the  Company  transferred  its  interest  in the
              assets,  liabilities,  and  operations  of SIS,  Inc. to Satellite
              Image Systems,  LLC (SIS,  LLC), a joint venture.  On May 12, 1998
              the Company  sold its 46.5%  interest in SIS,  LLC. In  connection
              with the sale the company  recognized a gain of $180,023.  On June
              15,  1998,  the  Company  completed  the  acquisition  of  certain
              licenses and  technology  of Digital  Health,  LLC in exchange for
              1,375,000  shares of common  stock and $250,000 in cash payable in
              monthly installments of $15,000. On February 16, 1999, the Company
              acquired  certain assets known as the P.I.C.E.  technology from an
              individual in exchange for 250,000 shares of common stock.

(2)           The unaudited condensed  consolidated financial statements include
              all adjustments,  consisting of normal recurring items, which are,
              in the  opinion of  management,  necessary  to present  fairly the
              financial  position  of the  company  as of June 30,  1999 and the
              results of  operations  for the three  months and six months ended
              June 30,  1999 and 1998 and cash  flows for the six  months  ended
              June 30, 1999 and 1998.  The results of  operations  for the three
              months  ended  June 30,  1999 are not  necessarily  indicative  of
              quarterly results to be expected for the remainder of the year.

<PAGE>

(3)           The  amount of the loss per share is based on the weighted average
              number of shares outstanding at June 30, 1999 and 1998,
              respectively.

(4)           Effective  May 12, 1998 the Company  entered  into an agreement to
              sell its  46.5%  interest  in SIS,  LLC.  Terms  of the  agreement
              include an initial  payment of $1,500,000 and additional  payments
              not to exceed  $1,000,000  that  will be  earned  over the next 27
              months based upon the operating results of SIS, LLC. $1,200,000 of
              the funds received were used to retire a  non-revolving  term line
              of credit.  The balance of the funds was used for working  capital
              purposes.

(5)           On May 19, 1998 the company entered into a $3,000,000  revolving
              line of credit  agreement.  During the three months ended
              June 30, 1999 the Company made no additional  borrowings  under
              this  revolving  line of credit.  This  revolving  line of credit
              matures on August 19, 1999 and is secured by the  Company's
              inventory and receivables and by the personal  guarantees of the
              Company's  Chief Executive  Officer,  a Director,  and a major
              shareholder.  As of June 30,  1999 the  Company  had an
              outstanding balance of $2,996,158 under this revolving line
              of credit.

(6)           During the six months  ended June 30, 1999 the Company  borrowed a
              net amount of $250,000 from the Company's Chief Executive Officer,
              or from entities controlled by this individual, under two separate
              $100,000   unsecured  note  payable  agreements  and  one  $50,000
              unsecured note payable agreement. Each note payable bears interest
              at 12% and is payable upon demand.


(7)           The Company also  borrowed  $350,000 and $250,000  from  unrelated
              parties under separate  convertible note payable agreements.  Each
              convertible  note  payable  bears  interest at 12% and  contains a
              provision for the  conversion  of the  principal  amount to common
              stock at a specified  price. On March 31, 1999,  both  convertible
              note payable agreements were converted to common stock at $.35 per
              common share. In addition, the Company borrowed $200,000, $100,000
              and $25,000 from unrelated parties under separate convertible note
              payable  agreements.  Each bears  interest  at 12% and  contains a
              provision for the  conversion  of the  principal  amount to common
              stock at a specified price. The funds from these transactions were
              used to finance  operations.  In addition,  the Company  converted
              certain  accounts  payable to a vendor into a note  payable in the
              amount of $39,313.  This note payable bears  interest at 9% and is
              payable at the end of six months from the date of issuance.

(8)           Effective  March 31, 1999,  $1,300,000 of related party notes
              payable were converted to common stock of the Company.
              In addition,  accrued  interest  payable on the related
              party notes payable of $11,033 was used by the related parties
              to exercise warrants to purchase common stock.

<PAGE>

(9)           Effective  March 16, 1999,  the Company has issued a formal letter
              of intent to acquire Biological Technologies  International,  Inc.
              (BTI) in a stock for stock exchange.  This transaction is intended
              to be accounted for as a "pooling of interests"  transaction  and,
              as of the date of this filing, is still pending.


<PAGE>


                         PART I - FINANCIAL INFORMATION


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

Six-month period ended June 30, 1999 compared to the six-month period ended June
30, 1998.

Results of BioMeridian

BioMeridian  International,  Inc. (BioMeridian)  manufactures and sells the BEST
system to healthcare practitioners.  This equipment is used to assess stress and
assist  healthcare  practitioners  in the  analysis  and  treatment  of  certain
conditions.  If stress or  imbalance  is  detected,  the BEST  system is used to
recommend a course of treatment or therapy to alleviate the stress or to restore
balance to the body's  meridian  systems.  BioMeridian  also  provides  training
classes and support services for health care practitioners that utilize the BEST
system.   The  BEST  system  is   registered   with  the  U.S.   Food  and  Drug
Administration.

For the six months ended June 30, 1999  BioMeridian  achieved  sales revenues of
$3,060,409  that resulted in an operating  loss of $553,530  compared with sales
revenues of $978,586 that resulted in an operating  loss of $182,619 for the six
months ended June 30, 1998. The  significant  increase in sales is the result of
the  synergies of the acquired  assets and  technology  of BioSource and Digital
Health  and the  expanded  user base along  with the  increase  in the number of
independent  sales  representatives  to  approximately  thirty  nationwide.  The
increased operating loss is primarily due to unusually high selling expenses due
to training of direct and indirect sales  representatives and the elevated level
of overhead  within the operation of BioMeridian.  The increased  overhead costs
are the result of improved  marketing  strategies and improved customer training
and support personnel.

Although  BioMeridian  has  experienced  operating  losses  during the six-month
period ended June 30, 1999,  the Company  believes  that after an  investment of
approximately $1.7 million during the past eighteen months,  BioMeridian has now
reached a  sustainable  revenue  level in excess  of  $500,000  per month and is
poised to achieve  profitable  operations  in the third and fourth  quarters  of
1999.
<PAGE>

Results of SkyHook

Since its formation in February 1995, SkyHook  Technologies,  Inc. (SkyHook) has
been  engaged  in  the  development  of  computer-controlled   multi-hook  cargo
transport  devices that SkyHook  believes will improve the efficiency and safety
of  helicopter  missions by enabling the  selective  delivery  and  retrieval of
multiple external  payloads during a single mission.  SkyHook also believes that
its  devices  will allow an aircrew to more fully  utilize a  helicopter's  load
capacity while minimizing flight time.

SkyHook's patented products include the SkyHook External Cargo Management System
(SkyHook ECMS) and the SkyHook Light Ariel Delivery System  (SkyHook LADS).  The
SkyHook  LADS is a lower cost system  designed  to carry three or four  separate
loads with total  system  load  capacity  of 12,000  pounds.  The  SkyHook  LADS
complements  the SkyHook  ECMS that is  designed to carry three or six  separate
loads with a total system  capacity of 36,000 pounds.  With the  introduction of
the LADS system to complement the ECMS product, the company can effectively meet
the varying  needs of its  potential  customers.  SkyHook has invested over $8.0
million in the development,  testing and marketing of its unique  products.  The
Company continues an aggressive marketing campaign with the U.S. Military as its
primary potential customer.

SkyHook  has made  significant  progress in its  marketing  effort with the U.S.
Military  and other  government  agencies.  During the six months ended June 30,
1999,  the Kansas  National  Guard issued a purchase  order for one Light Aerial
Delivery  System  (LADS).  The LADS system was delivered to the Kansas  National
Guard in late April 1999. SkyHook anticipates  additional revenues from the sale
of SkyHook  products near the end of 1999.  However,  currently the Company must
rely on its lines of credit and its ability to raise  additional debt and equity
financing  in  order  to  finance  continued  product  development,   sales  and
marketing,  and all  operating  activities  related to SkyHook and its products.
On-going  operations  of SkyHook are expected to consume  approximately  $95,000
each month.

SkyHook was  recently  awarded a contract  with  Envirofoam  Technologies,  Inc.
(Envirofoam)  that  provides  for the  marketing  and contract  management  of a
patented fire suppression device that is targeted for sale to the U.S. Military.
During the six  months  ended  June 30,  1999  SkyHook  recognized  revenues  of
$115,500 under this contract with Envirofoam.

Three-month  period ended June 30, 1999 compared to the three-month period ended
June 30, 1998.

Results of BioMeridian

For the three months ended June 30, 1999 BioMeridian  achieved sales revenues of
$1,658,912  which resulted in an operating loss of $123,069  compared with sales
revenues of $735,969  which  resulted  in an  operating  loss of $49,755 for the
three  months  ended June 30,  1998.  The  significant  increase in sales is the
result of the synergies of the acquired  assets and  technology of BioSource and
Digital  Health and the expanded user base along with the increase in the number
of independent sales  representatives to approximately  thirty  nationwide.  The
increased operating loss is primarily due to unusually high selling expenses due
to training of direct and indirect sales  representatives and the elevated level
of overhead  within the operation of BioMeridian.  The increased  overhead costs
are the result of improved  marketing  strategies and improved customer training
and support personnel.
<PAGE>

Although  BioMeridian  has experienced  operating  losses during the three-month
period ended June 30, 1999,  the Company  believes  that after an  investment of
approximately $1.7 million during the past eighteen months,  BioMeridian has now
reached a  sustainable  revenue  level in excess  of  $500,000  per month and is
poised to achieve  profitable  operations  in the third and fourth  quarters  of
1999.

Results of SkyHook

SkyHook  has made  significant  progress in its  marketing  effort with the U.S.
Military and other government  agencies.  During the three months ended June 30,
1999,  the Kansas  National  Guard issued a purchase  order for one Light Aerial
Delivery  System  (LADS).  The LADS system was delivered to the Kansas  National
Guard in late April 1999. SkyHook anticipates  additional revenues from the sale
of SkyHook  products near the end of 1999.  However,  currently the Company must
rely on its lines of credit and its ability to raise  additional debt and equity
financing  in  order  to  finance  continued  product  development,   sales  and
marketing,  and all  operating  activities  related to SkyHook and its products.
On-going  operations  of SkyHook are expected to consume  approximately  $95,000
each month.

SkyHook was  recently  awarded a contract  with  Envirofoam  Technologies,  Inc.
(Envirofoam)  that  provides  for the  marketing  and contract  management  of a
patented fire suppression device that is targeted for sale to the U.S. Military.
During the three  months  ended June 30,  1999  SkyHook  recognized  revenues of
$99,000 under this contract with Envirofoam.

Liquidity and Capital Resources

On May 19, 1998 the company  entered into a $3,000,000  revolving line of credit
agreement.  During the three  months  ended June 30,  1999 the  Company  made no
additional  borrowings under this revolving line of credit.  This revolving line
of credit  matures on August 19, 1999 and is secured by the Company's  inventory
and receivables and by the personal  guarantees of the Company's Chief Executive
Officer, a Director,  and a major  shareholder.  As of June 30, 1999 the Company
had an outstanding balance of $2,996,158 under this revolving line of credit.

During the six months  ended June 30, 1999 the Company  borrowed a net amount of
$250,000 from the Company's Chief Executive Officer, or from entities controlled
by  this  individual,   under  two  separate  $100,000  unsecured  note  payable
agreements and one $50,000 unsecured note payable  agreement.  Each note payable
bears interest at 12% and is payable upon demand.

The Company also  borrowed  $350,000 and $250,000 from  unrelated  parties under
separate  convertible  note payable  agreements.  Each  convertible note payable
bears  interest  at 12% and  contains  a  provision  for the  conversion  of the
principal  amount to common stock at a specified  price. On March 31, 1999, both
convertible  note payable  agreements were converted to common stock at $.35 per
common share. In addition,  the Company borrowed $200,000,  $100,000 and $25,000
from unrelated parties under separate convertible note payable agreements.  Each
bears  interest  at 12% and  contains  a  provision  for the  conversion  of the
principal  amount to common  stock at a  specified  price.  The funds from these
transactions were used to finance operations. In addition, the Company converted
certain  accounts  payable  to a vendor  into a note  payable  in the  amount of
$39,313. This note payable bears interest at 9% and is payable at the end of six
months from the issuance date.
<PAGE>

Effective  March 31,  1999,  $1,300,000  of related  party  notes  payable  were
converted to common stock of the Company. In addition,  accrued interest payable
on the related party notes payable of $11,033 was used by the related parties to
exercise warrants to purchase common stock.

The Company has made significant  investment and effort over the last five years
into the establishment of a sound framework for operating entities that are well
positioned  in  their  respective  marketplaces.   Management  feels  that  both
BioMeridian  and  SkyHook  are now poised  for  success  and  future  profitable
operations.  However, there can be no assurance that the Company will be able to
achieve  profitable  operations  or obtain  the  needed  debt or equity  capital
required on terms  favorable to the  Company.  If the Company is unable to raise
additional  capital,  the  ability  of the  Company to  successfully  market and
distribute its products and services through its operating  subsidiaries and its
financial condition would be materially adversely affected.



                                             PART II - OTHER INFORMATION

Item 1.           Legal proceedings:  None.

Item 2.           Changes in Securities:    None.

Item 3.           Defaults upon Senior Securities:   None.

Item 4.           Submission of Matters to a Vote of Security Holders: None.

Item 5.           Other information:  None.

Item 6.           Exhibits and Reports on Form 8-K:   None.

<PAGE>


SIGNATURES

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


                            MAGELLAN TECHNOLOGY, INC.
                            -------------------------
                                  (Registrant)




\s\Douglas M. Angus                                             August 12, 1998
------------------------                                      -----------------
Douglas M. Angus                                                     Date
Vice President - Finance