U.S. Securities and Exchange Commission

                              Washington, DC 20549

                                   Form 10-QSB

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

For the quarterly period ended May 30, 2001

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

For the transition period from_____ to_____

Commission File number:0-25429

                      Diversified Product Inspections, Inc.
                     ---------------------------------------
                     (Exact name of small business issuer as
                            specified in its charter)

          Florida                                         65-0832025
---------------------------------                       -------------------
(State of other jurisdiction of                         (IRS Employer
incorporation or organization)                          Identification No.)


                                  3 Main Street
                               Oak Ridge, TN 37830
                           --------------------------
                    (Address of principal executive offices)


                                 (865) 482-8480
                           ---------------------------
                           (Issuer's telephone number)



                                       N/A
              -----------------------------------------------------
              (Former name, former address, and former fiscal year,
                          if changed since last report)









<PAGE>



     Check  whether  the issuer (1) filed all  reports  required  to be filed by
Section 13 or 15 (d) of the  Exchange Act during the past 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 ___

     As of July 19, 2001,  there were 14,062,852  shares of common stock,  $0.01
par value, issued and outstanding.





                          INDEX TO FINANCIAL STATEMENTS


Condensed Consolidated Balance Sheets........................................F-2

Condensed Consolidated Statements of Operations..............................F-3

Condensed Consolidated Statements of Stockholders' Equity ...................F-4

Condensed Consolidated Statements of Cash Flows..............................F-5

Notes to Condensed Consolidated Financial Statements.........................F-6


























<PAGE>


<TABLE>
<CAPTION>
                      Diversified Product Inspections, Inc.
                      Condensed Consolidated Balance Sheets


                                                                                  May 31,          February 28,
                                                                                   2001                2001
                                                                            ------------------- -------------------
                                                                                (unaudited)
<S>                                                                         <C>                 <C>
                                   ASSETS
CURRENT ASSETS
   Cash and equivalents                                                     $           182,474 $           154,573
   Accounts receivable, net                                                              93,882             101,349
   Refundable income taxes                                                                5,214               5,214
   Prepaid expenses                                                                       2,929               6,379
                                                                            ------------------- -------------------
           Total current assets                                                         284,499             267,515
                                                                            ------------------- -------------------

PROPERTY AND EQUIPMENT
   Equipment                                                                            171,495             116,587
   Vehicles                                                                              94,435              94,435
   Leasehold improvements                                                                22,727              22,727

         Less accumulated depreciation                                                  (63,345)            (49,957)
                                                                            ------------------- -------------------

           Net property and equipment                                                   225,312             183,792
                                                                            ------------------- -------------------

OTHER ASSETS
   Other assets                                                                          11,092               4,400
                                                                            ------------------- -------------------
           Total other assets                                                            11,092               4,400
                                                                            ------------------- -------------------

Total Assets                                                                $           520,903 $           455,707
                                                                            =================== ===================

                    LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES
   Line of credit payable                                                   $            73,092 $            73,092
   Accounts payable                                                                     141,218              69,772
   Accrued salaries                                                                      12,226              10,839
   Current portion of long-term debt                                                     16,456              15,717
   Current portion of capital lease obligations                                          14,859              14,602
   Other current liabilities                                                                  0               4,634
                                                                            ------------------- -------------------

          Total current liabilities                                                     257,851             188,656
                                                                            ------------------- -------------------

LONG-TERM DEBT AND CAPITAL LEASE OBLIGATIONS
   Long-term debt, net of current portion                                                49,948              54,489
   Capital lease obligations, net of current portion                                     10,732              14,546
                                                                            ------------------- -------------------

          Total long-term debt and capital lease obligations                             60,680              69,035
                                                                            ------------------- -------------------
Total Liabilities                                                                       318,531             257,691
                                                                            ------------------- -------------------

STOCKHOLDERS' EQUITY
  Common stock, $0.01 and $1.00 par value, authorized 50,000,000 and
    10,000,000 shares; 14,062,852 and 9,712,601 issued and outstanding                  140,628           9,712,601
  Additional paid-in capital                                                          1,355,256          (8,380,021)
  Accumulated deficit                                                                (1,293,512)         (1,134,564)
                                                                            ------------------- -------------------

          Total stockholders' equity                                                    202,372             198,016
                                                                            ------------------- -------------------
Total Liabilities and Stockholders' Equity                                  $           520,903 $           455,707
                                                                            =================== ===================
</TABLE>




     The accompanying notes are an integral part of the financial statements


                                       F-2

<PAGE>


<TABLE>
<CAPTION>
                      Diversified Product Inspections, Inc.
                 Condensed Consolidated Statements of Operations
                           Three Months Ended May 31,
                                   (unaudited)



                                                                                   2001                    2000
                                                                           --------------------    --------------------
<S>                                                                        <C>                     <C>
REVENUES                                                                   $            215,429    $            289,444

OPERATING EXPENSES
    Salaries                                                                            158,220                 119,557
    Depreciation and amortization                                                        13,388                   6,712
    General and administrative                                                          200,362                 139,036
                                                                           --------------------    --------------------

            Total operating expenses                                                    371,970                 265,305
                                                                           --------------------    --------------------

Operating Income (Loss)                                                                (156,541)                 24,139
                                                                           --------------------    --------------------

OTHER INCOME (EXPENSE)
    Other income                                                                          6,294                       0
    Other expense                                                                        (2,624)                      0
    Interest expense                                                                     (6,078)                 (1,616)
                                                                           --------------------    --------------------

            Net other income (expense)                                                   (2,408)                 (1,616)
                                                                           --------------------    --------------------

Net income (loss) before income tax                                                    (158,949)                 22,523

    Income tax expense                                                                        0                   3,378
                                                                           --------------------    --------------------

Net income (loss)                                                          $           (158,949)   $             19,145
                                                                           ====================    ====================

Net income (loss) per common share                                         $              (0.01)   $               0.01
                                                                           ====================    ====================

Weighted average number of common shares outstanding                                 13,612,852              11,116,900
                                                                           ====================    ====================
</TABLE>













     The accompanying notes are an integral part of the financial statements


                                       F-3

<PAGE>


<TABLE>
<CAPTION>
                      Diversified Product Inspections, Inc.
            Condensed Consolidated Statements of Stockholders' Equity





                                                                                                                Total
                                                                              Additional                    Stockholders'
                                                 Number of       Common        Paid-in                          Equity
                                                   Shares         Stock        Capital         Deficit       (Deficiency)
                                               -------------- ------------- --------------  -------------- ----------------
<S>                                             <C>           <C>           <C>             <C>            <C>
BEGINNING BALANCE,
February 29, 2000                                   6,150,000 $      61,500 $            0  $     (282,497)$       (220,997)

Year ended February 28, 2001:
   Shares issued for services                      10,000,000       100,000              0               0          100,000
   Debt forgiveness                                         0             0        321,784               0          321,784
   Net loss                                                 0             0              0        (108,787)        (108,787)
                                               -------------- ------------- --------------  -------------- ----------------

BALANCE, February 28, 2001                         16,150,000       161,500        321,784        (391,284)          92,000

Three Months Ended May 31, 2001:
--------------------------------
(unaudited)
   Shares contributed to company                  (14,200,000)     (142,000)        50,000               0          (92,000)
   Reverse merger                                  10,332,420       103,323        837,972        (743,279)         198,016
   Shares issued for services                       1,330,432        13,305              0               0           13,305
   Shares issued for cash                             450,000         4,500        145,500               0          150,000
   Net loss                                                 0             0              0        (158,949)        (158,949)
                                               -------------- ------------- --------------  -------------- ----------------

ENDING BALANCE, May 31, 2001
(unaudited)                                        14,062,852 $     140,628 $    1,355,256  $   (1,293,512)$        202,372
                                               ============== ============= ==============  ============== ================
</TABLE>















     The accompanying notes are an integral part of the financial statements


                                       F-4

<PAGE>



<TABLE>
<CAPTION>
                      Diversified Product Inspections, Inc.
                 Condensed Consolidated Statements of Cash Flows
                           Three Months Ended May 31,
                                   (unaudited)


                                                                                     2001               2000
                                                                              ------------------    ----------------
<S>                                                                           <C>                   <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income (loss)                                                             $         (158,949)   $         19,145
Adjustments to reconcile net loss to net cash used by operating activities:
     Depreciation                                                                         13,388               6,712
     Income tax expense                                                                        0               3,378
     Stock issued for services                                                            13,305                   0
Changes in operating assets and liabilities:
     (Increase) decrease in accounts receivable                                            7,467              41,897
     (Increase) decrease in prepaid expenses                                               3,450                   0
     (Increase) decrease in other assets                                                  (6,692)                  0
     Increase (decrease) in accounts payable                                              71,446                 335
     Increase (decrease) in accrued salaries                                               1,387              21,600
     Increase (decrease) in other current liabilities                                     (4,634)                  0
                                                                              ------------------    ----------------

Net cash  provided (used) by operating activities                                        (59,832)             93,067
                                                                              ------------------    ----------------

CASH FLOW FROM INVESTING ACTIVITIES:
     Purchase of property and equipment                                                  (54,908)            (42,241)
     Deposit on real property                                                                  0            (215,000)
                                                                              ------------------    ----------------

Net cash provided (used) by investing activities                                         (54,908)           (257,241)
                                                                              ------------------    ----------------

CASH FLOW FROM FINANCING ACTIVITIES:
     Common stock sold for cash, net                                                     150,000             440,660
     Proceeds of  long-term debt                                                               0              42,241
     Debt and capital lease payments                                                      (7,359)             (8,706)
                                                                              ------------------    ----------------

Net cash provided (used) by financing activities                                        (142,641)            474,195
                                                                              ------------------    ----------------

Net increase (decrease) in cash and equivalents                                          (27,901)            310,021

CASH and equivalents, beginning of period                                                154,573              53,335
                                                                              ------------------    ----------------

CASH and equivalents, end of period                                           $          182,474    $        363,356
                                                                              ==================    ================

SUPPLEMENTAL DISCLOSURE OF CASH FLOW
INFORMATION:

Interest paid in cash                                                         $            6,078    $          1,616
                                                                              ==================    ================
</TABLE>










     The accompanying notes are an integral part of the financial statements


                                       F-5

<PAGE>



                      Diversified Product Inspections, Inc.
                    Notes to Condensed Consolidated Financial
             Statements (Information with regard to the three months
                   ended May 31, 2001 and 2000 is unaudited)


1.   Accounting Policies

Description of Business

Diversified Product Inspections, Inc. ("the Company"), formerly known as Fairfax
Group, Inc., specializes in conducting investigations and laboratory analysis of
a wide  variety of  products  to  determine  the  "cause and  origin" of product
failures.   The  Company's  primary  customers  consist  of  national  insurance
companies  that  are  interested  in  subrogating   claims  to  recover  losses.
Subrogation is a legal principle,  which provides that, to the extent an insurer
has paid for a loss, the insurer  receives the  policyholder's  right to recover
from any third party that caused the loss.  The Company has  accumulated a large
database  of  known   defective   products  that   includes   photos  and  other
documentation that are used in their investigations.  Additionally,  the Company
provides  for the  storage of  evidence  and  derives  revenues  from the secure
storage of materials.

Accounts Receivable

Two customers account for the majority of accounts receivable at March 31, 2001.
It is the Company's policy not to require collateral on accounts receivable.

Property and Equipment

Property and equipment are carried at cost.  Depreciation  is computed using the
straight-line method over the estimated useful lives of the assets.

Estimates

The preparation of financial  statements in conformity  with generally  accepted
accounting principles requires management to make estimates and assumptions that
affect certain  reported amounts and  disclosures.  Accordingly,  actual results
could differ from those estimates.

Principles of Consolidation

The  condensed   consolidated  financial  statements  include  the  accounts  of
Diversified   Product   Inspections,   Inc.  and  its  wholly  owned  subsidiary
Diversified  Product  Investigations,   Inc.,  (Investigations).   Inter-company
balances  and  transactions  have  been  eliminated.  The  historical  financial
statements of Investigations, (see Note 2 - Reorganization), have been presented
for the period prior to the reverse merger.  The reporting  parent company has a
fiscal  year end of  February  28 and the  subsidiary  has a fiscal  year end of
December 31.  Accordingly,  the  financial  statements  as presented are for the
three  months ended May 31 (parent)  and March 31  (subsidiary),  except for the
statement of stockholders'  equity,  which reflects the parent  historical up to
the date of the reverse merger, and consolidated thereafter.

                                       F-6

<PAGE>



                      Diversified Product Inspections, Inc.
              Notes to Condensed Consolidated Financial Statements


Net Income (Loss) Per Common Share

Basic net  income  (loss) per  weighted  average  common  share is  computed  by
dividing the net income (loss) by the weighted  average  number of common shares
outstanding during the period.

Cash and Equivalents

The company  considers  investments  with an initial maturity of three months or
less as cash equivalents.

Reclassifications

Certain 2000 amounts have been reclassified to conform to 2001 classifications.

Concentrations

Approximately  69% of  revenues  for the three  months  ended May 31,  2001 were
derived from the Company's three largest customers.

Interim Financial Information

The  financial  statements  for the three months ended May 31, 2001 and 2000 are
unaudited and include all  adjustments  which in the opinion of  management  are
necessary  for fair  presentation,  and  such  adjustments  are of a normal  and
recurring nature.  The results for the three months are not indicative of a full
year results.

2.   Reorganization

During March 2000, Investigations,  entered into a stock exchange agreement with
Shoe Krazy,  Inc. ("Shoe Krazy") in which Shoe Krazy issued  9,241,900 shares of
restricted  common stock to acquire all of the issued and outstanding  shares of
the  common  stock of  Investigations.  As Shoe  Krazy was  essentially  a shell
company,  this  reorganization  was  considered  a reverse  acquisition.  During
February 2001, both companies entered into a separate  agreement to void, cancel
and terminate the original stock  exchange  agreement and restore all parties to
their  position prior to the original  agreement  being  executed.  Accordingly,
these  financial  statements  are  presented as if the original  stock  exchange
agreement never occurred.




                                       F-7

<PAGE>



                      Diversified Product Inspections, Inc.
              Notes to Condensed Consolidated Financial Statements


2.  Reorganization (continued)

In March 2001,  the Company,  (f/k/a  Fairfax  Group,  Inc.),  or (FGI),  issued
10,332,420  shares of restricted  common stock to acquire 100% of the issued and
outstanding  common  stock of  Investigations  in a  reverse  merger  which  was
accounted for as a recapitalization of Investigations. FGI then changed its name
to Diversified Product Inspections, Inc.

3.   Company Stock

At December 31, 1999, Investigations had accrued salaries to the shareholders of
$298,275.  During 2000,  Investigations  converted these accrued salaries, along
with  additional  salary  expenses for 2000 of $64,656,  into 362,931  shares of
common stock of Investigations.  On October 1, 2000, Investigations entered into
an employment  agreement  with a key employee in which this employee earns 6,250
shares of common stock per month, in lieu of salary. During 2000, Investigations
recognized  salary  expense of $18,750 and issued  18,750 shares of common stock
related to this arrangement.  Additionally,  during 2000, Investigations entered
into an arrangement with another key employee in which this employee earns 5,000
shares of common stock per year for five years,  at which time the employee will
receive an additional  50,000  shares.  During 2000,  Investigations  recognized
salary expense of $5,000 and issued 5,000 shares of common stock related to this
arrangement.

During 2000,  Investigations sold 325,920 shares of stock to various individuals
and  companies.  As  part  of the  stock  purchase  agreement,  one  of the  new
stockholders  obtained  stock  warrants  which allow for the  purchase of 12,500
shares of common stock of  Investigations  at a price of $0.01 per share.  These
warrants expire on July 13, 2003. Additionally, another new stockholder obtained
stock  warrants which allow for the purchase of 50,000 shares of common stock at
a price of $0.0001 per share. These warrants expire on December 11, 2003.

On March 6, 2001, the then new majority  stockholder  relinqished his 14,200,000
shars of common stock owned.

In March 2001, the Company issued  1,330,432  shares of common stock,  valued at
$13,305, to certain  consultants of the Company via a Form S-8 Registration.  In
April 2001,  the Company  issued  450,000 shares of common stock in exchange for
$150,000 in cash. In addition,  warrants for 375,000 shares of common stock were
issued with those shares, expiring in April 2003, with an exercise price of $1.







                                       F-8

<PAGE>



                      Diversified Product Inspections, Inc.
              Notes to Condensed Consolidated Financial Statements


4.  Long-Term Debt and Line of Credit

Long-term debt is summarized as follows at May 31, 2001:

<TABLE>
<S>                                                     <C>
Note payable, secured by a vehicle, due in monthly
  installments of $199, including interest at 9.25%,
  through April 2002                                    $        2,633
Note payable, secured by a vehicle, due in monthly
  installments of $597 including interest at 5.9%,
  through February 200                                          19,641
Note payable, secured by a vehicle, due in monthly
  installments of $330, including interest at 11%,
  through November 2005                                         14,418
Note payable, secured by a vehicle, due in monthly
  installments of $333, including interest at 11%,
  through November 2005                                         14,521
Note payable, secured by a vehicle, due in monthly
  installments of $348, including interest at 11%,
  through November 2005                                         15,191
                                                        --------------
                                                                66,404
Less portion classified as current                              16,456
Long-term portion                                       $       49,948
------------------------------------------------------- --------------
</TABLE>

Aggregate maturities of long-term debt as of May 31, 2001, are as follows:


         2002      $  16,456
         2003         15,085
         2004         16,464

         2005         10,634
         2006          7,756

                   $  66,404
                   ---------

The Company  utilizes two credit cards with financial  institutions  as lines of
credit.  One of the credit cards has a limit of $50,000 and bears interest at an
annual  rate of 12.5% as of March 31,  2001.  The balance was $49,388 at May 31,
2001.  The second  credit card has a limit of $27,500  and bears  interest at an
annual rate of 25.68%.  This balance was $23,704 at May 31, 2001.  Both of these
lines of credit are unsecured and require minimum monthly payments.

5.  Lease Obligations

The Company leases certain  equipment under  agreements  which are classified as
capital leases. These agreements expire in 2002 and 2003.



                                       F-9

<PAGE>



                      Diversified Product Inspections, Inc.
              Notes to Condensed Consolidated Financial Statements


5.  Lease Obligations (continued)

The  Company  also  leases  their  office  and  warehouse,  along  with  certain
equipment,  under agreements  classified as operating leases. The Company has an
agreement with the office and warehouse lessor in which the Company is obligated
to purchase  the office and  warehouse  if the Company  receives  $3,000,000  in
proceeds from a private placement  offering.  The purchase price will range from
between  $1,450,000  and  $1,607,640,  depending on the year the purchase  takes
place. This purchase obligation expires on December 31, 2004.

Future minimum payments for leases, by year and in the aggregate, consist of the
following as of May 31, 2001:

<TABLE>
<CAPTION>
                                                                   Operating           Capital
                                                                 -----------------  -----------------
<S>            <C>                                               <C>                <C>
               2001                                              $         209,124  $          16,117
               2002                                                        213,322             10,974
               2003                                                        211,875                  -
               2004                                                        217,500                  -
               2005                                                        163,125                  -
                                                                 -----------------  -----------------
               Total minimum lease payments                      $       1,014,946  $          27,091
                                                                 =================
               Amount representing interest                                                     1,500
                                                                                    -----------------
               Present value of net minimum lease
                payments (including $14,859 classified
                as current)                                                         $          25,591
                                                                                    =================
</TABLE>

Property and equipment includes the following amounts for capital leases at May
31, 2001:

<TABLE>
<S>      <C>                                           <C>
         Equipment                                     $             44,075
         Less accumulated amortization                               21,757
                                                       --------------------
                                                       $             22,318
                                                       ====================
</TABLE>

Amortization  of these  assets,  computed by the  straight-line  method over the
lesser  of the life of the  asset  or the  term of the  lease,  is  included  in
depreciation and amortization expense.

6.  Income Taxes

For tax purposes the Company has net operating loss ("NOL") carryovers  totaling
approximately  $620,000 which are available to offset future taxable income. The
NOL carryovers expire primarily in 2020.


                                      F-10

<PAGE>


                      Diversified Product Inspections, Inc.
              Notes to Condensed Consolidated Financial Statements


6.  Income Taxes (continued)

Deferred  income  taxes  reflect  the net tax effects of  temporary  differences
between the carrying  amounts of assets and liabilities for financial  reporting
purposes and the amounts used for income tax purposes. Significant components of
the  Company's  deferred  tax assets and  liabilities  are as follows at May 31,
2001:

<TABLE>
<S>                                                         <C>
Deferred tax assets:
   NOL carryover                                            $         235,267
   Expenses not currently deductible                                   33,559
   Reserve for doubtful accounts                                        6,453
   Other                                                                  437
                                                            -----------------
                                                                      275,716
   Valuation allowance for deferred tax assets                       (264,021)
                                                            -----------------
Net deferred tax assets                                                11,690
Deferred tax liability - tax over book depreciation                    11,690
                                                            -----------------
Net deferred tax assets                                      $              -
                                                            -----------------
</TABLE>

The valuation  allowance was increased by $62,045 for the three months ended May
31, 2001, due to increases in deferred tax assets for which  realization was not
assured.

7.  Going Concern

The  accompanying  financial  statements  have been  prepared on a going concern
basis,  which  contemplates  the  realization of assets and the  satisfaction of
liabilities in the normal course of business.  The Company's  continuing losses,
among other  things,  may  indicate  the Company will be unable to continue as a
going concern for a reasonable period of time. Management recognizes the Company
must return to profitable  operations and generate  additional funds in order to
continue as a going concern. The Company successfully raised capital during 2000
to fund its operations,  and the Company  anticipates raising additional capital
in 2001 through private placement offerings.






                                      F-11






<PAGE>



Item 2.  Management's Discussion and Analysis.

     (a) Plan of Operation

     This Quarterly Report on Form 10-QSB should be read in conjunction with our
unaudited  financial  statements  included  as part of this Form 10- QSB Report.
This Quarterly Report on Form 10-QSB contains  forward-looking  statements.  For
this  purpose,  any  statements  contained  in it  that  are not  statements  of
historical fact should be regarded as forward looking  statements.  For example,
the words  "believes,"  "anticipates,"  "plans," and  "expects"  are intended to
identify  forward-looking  statements.  There are a number of important  factors
that could cause our Company's  actual results to differ  materially  from those
indicated by such forward-looking statements.

     On March 6, 2001, the Company entered into a share exchange  agreement with
Diversified Product Investigations, Inc., a Florida corporation ("DPI"), and the
individual  holders  of  all of  the  outstanding  capital  stock  of  DPI  (the
"Holders") (the "Agreement"). Pursuant to the Agreement, the Holders tendered to
the Company all issued and outstanding shares of common stock of DPI in exchange
for  10,332,420  shares of common stock of the Company.  The  reorganization  is
being accounted for as a reverse acquisition.  In connection with the Agreement,
Mr. Adams relinquished  14,200,000 shares of the common stock of the Company for
cancellation.

     Also on March 6, 2001,  the name of the Company was changed to  Diversified
Product Inspections, Inc.

     In March 2001,  the Company filed a  Registration  Statement on Form S-8 to
register its  Employee/Consultant  Stock  Compensation  Plan. In connection with
such plan,  1,330,432  shares have been issued to the  Company's  employees  and
consultants. 69,568 shares have yet to be issued under the plan.

     In April 2001,  the Company sold 450,000  shares of its  restricted  common
stock to two (2)  investors for a total of $150,000.  Additionally,  warrants to
purchase an additional  375,000  shares at an exercise  price of $1.00 per share
were issued to the same two (2)  investors.  The term of the warrants is two (2)
years. The warrants have certain cashless exercise provisions.

     In May 2001,  Dean  Madden,  the  Company's  Chief  Financial  Officer  and
Director resigned. Mr. Madden did not resign due to a personal disagreement with
the Company on any matter  relating  to the  Company's  operations,  policies or
practices  and did  not  provide  the  Company  with a  letter  describing  such
disagreement nor request that the matter be disclosed.

     In July 2001,  Steven  Durland of Palm Beach,  FL accepted  the position of
acting Chief Financial Officer and acting Director.

Financial Condition, Capital Resources and Liquidity

     At May 31, 2001, the Company had assets  totaling  $520,903 and liabilities
of  $318,531.  During  April 2001,  the Company  issued and sold an aggregate of
450,000  shares  of  Common  Stock to  residents  of  Canada  and Spain for cash
consideration totaling $150,000. No underwriter was


<PAGE>



employed in  connection  with the offering  and sale of the shares.  The Company
claimed the exemption from registration in connection with each of the offerings
provided  under Section 3(b) of the Act and Rule 504 of Regulation D promulgated
thereunder.

     The Company is seeking an additional investment of up to $1,000,000.

     The Company's  working  capital was $26,648 and $78,859 at May 31, 2001 and
2000, respectively.

     The ability of the Company to continue as a going concern is dependent upon
the availability of obtaining  additional  capital and financing from such third
parties and the ramp up of its new revenue streams.

Net Operating Losses

     The Company has net operating loss  carryforwards  of $1,293,512 , expiring
$158,949,  $590,519,  13,469,  $52,419 and $478,156 at February 28, 2022,  2021,
2020, 2019 and 2018.  Until the Company's  current  operations  begin to produce
earnings, it is unclear whether the Company can utilize such carryforwards.

     Revenues  declined  by  $74,000  for the three  months  ended May 31,  2001
compared  with the three  months  ended May 31,  20010,  principally  due to the
efforts  expended on developing a new revenue stream for the Company.  Operating
expenses  increased  $107,000  comparatively  due to the efforts  and  resultant
additional  expenses of  developing a new revenue  stream for the  Company.  Net
income (loss) changed from income of $19,000 to a loss of $159,000,  or a change
of $178,000,  principally due to the efforts expended on and additional expenses
incurred in developing a new revenue stream for the Company

Forward-Looking Statements

     This Form 10-QSB includes  "forward-looking  statements" within the meaning
of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the
Securities  Exchange  Act of  1934,  as  amended.  All  statements,  other  than
statements of historical  facts,  included or  incorporated by reference in this
Form 10-QSB which address  activities,  events or developments which the Company
expects or anticipates will or may occur in the future, including such things as
future capital expenditures  (including the amount and nature thereof),  finding
suitable merger or acquisition candidates, expansion and growth of the Company's
business and operations, and other such matters are forward-looking  statements.
These  statements  are based on certain  assumptions  and  analyses  made by the
Company in light of its  experience  and its  perception of  historical  trends,
current conditions and expected future  developments as well as other factors it
believes are appropriate in the circumstances.  However,  whether actual results
or developments will conform with the Company's  expectations and predictions is
subject  to a number of risks and  uncertainties,  general  economic  market and
business  conditions;  the business  opportunities (or lack thereof) that may be
presented  to and pursued by the  Company;  changes in laws or  regulation;  and
other   factors,   most  of  which  are  beyond  the  control  of  the  Company.
Consequently, all of the forward-looking statements made in this Form 10-QSB are
qualified by these cautionary statements and there can be no


<PAGE>



assurance  that the actual  results or  developments  anticipated by the Company
will be realized  or, even if  substantially  realized,  that they will have the
expected consequence to or effects on the Company or its business or operations.
The  Company   assumes  no  obligations  to  update  any  such   forward-looking
statements.

PART II

Item 1. Legal Proceedings.

     The  Company  knows  of no legal  proceedings  to which it is a party or to
which any of its  property  is the  subject  which are  pending,  threatened  or
contemplated or any unsatisfied judgments against the Company.

Item 2. Changes in Securities and Use of Proceeds

         None

Item 3. Defaults in 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

     (a) The exhibits  required to be filed  herewith by Item 601 of  Regulation
S-B, as described in the following index of exhibits, are incorporated herein by
reference, as follows:


Exhibit
Number    Exhibit Name
--------  ---------------------
<TABLE>
<S>       <C>
2.1       Share Exchange Agreement between with Diversified Product Inspections, Inc., a
          Florida corporation filed with the SEC on March 6, 2001.(2)

3.i.1     Articles of Incorporation and Amendment to Articles of Incorporation.(1)

3.ii.1    Bylaws.(1)

4.i.1     Articles of Incorporation and Amendment to Articles of Incorporation.(1)
</TABLE>



<PAGE>


<TABLE>
<S>       <C>
4.ii.1    Bylaws.(1)

10.1      Articles of Merger (Agreement and Plan of Merger  incorporated therein).(1)

10.2      Business Lease.(1)

10.3      Ernest Porter Employment Contract.(1)

10.4      Specimen Sample of Demand Promissory Notes made by the Registrant to Fred
          Keller.(1)
----------------
</TABLE>
(1)  Incorporated herein by reference to the Company's Registration Statement on
     Form 10-SB filed February 23, 1999.
(2)  Incorporated  herein by reference to the Company's  Form 8-K filed with the
     SEC on March 6, 2001.

*        Filed Herewith

     (b) Reports on Form 8-K.

     On  January 3, 2001,  the  Company  filed a Form 8-K to reflect a change of
control of the Company.

     On March 13,  2001,  the Company  filed a Form 8-K to reflect  that certain
Share Exchange Agreement with Diversified Product  Inspections,  Inc., a Florida
corporation,  and the individual holders of all of the outstanding capital stock
of Diversified Product Inspections, Inc. The Company filed a Form 8-K/A on March
21, 2001 to provide financial statements and the pro forma financial information
for Diversified Product Inspections,  Inc.., a Florida corporation,  as required
by Item 7 of Form 8-K.  The Company also changed its fiscal year end to December
31, to conform with the fiscal year end for its subsidiary.

     On May 14, 2001 the  Company  filed an 8-K/A to amend the Form 8-K filed on
March 21, 2001 by the  Company.  The purpose of this  amendment  was to provided
additional  financial  statements and the pro forma  financial  information  for
Diversified Product Inspections,  Inc.., a Florida  corporation,  as required by
Item 7 of Form 8-K and to  reflect  the May 19,  2001  change  by the  Company's
subsidiary ("SPI") of its name to Diversified Products Investigations, Inc.




<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.

                      Diversified Product Inspections, Inc.
                                  (Registrant)


Date: July 19, 2001      /s/ John Van Zyll
                         ------------------------------------------
                         John Van Zyll
                         President, Chief Executive Officer and Chairman

                         /s/ Marvin Stacy
                         ------------------------------------------
                         Marvin Stacy
                         Chief Operating Officer and Director

                         /s/ Ann Furlong
                         ------------------------------------------
                         Ann Furlong
                         Secretary and Director

                         /s/ Steve Durland
                         ------------------------------------------
                         Steve Durland
                         Acting Chief Financial Officer and Acting Director

                         /s/ Warren Wankelman
                         ------------------------------------------
                         Warren Wankelman
                         Director

                         /s/ Matt Walters
                         ------------------------------------------
                         Matt Walters
                         Director