SECURITIES & EXCHANGE COMMISSION
                             Washington, D. C. 20549

                                   FORM 10-QSB

(Mark One)

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

                   For the quarterly period ended May 31, 1999

[ ] TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE EXCHANGE ACT
       For the transition period from _________ to _________
                  Commission file number      1-4978


                             SOLITRON DEVICES, INC.
       -----------------------------------------------------------------
       (Exact name of small business issuer as specified in its charter)

           DELAWARE                                     22-1684144
-------------------------------             ------------------------------------
(State or other jurisdiction of             (IRS Employer Identification Number)
incorporation or organization)

              3301 ELECTRONICS WAY, WEST PALM BEACH, FLORIDA 33407
              ----------------------------------------------------
                    (Address of principal executive offices)

                                 (561) 848-4311
                           ---------------------------
                           (Issuer's telephone number)

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

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 filing requirements for the past 90 days.
Yes   X     No ______

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

Check whether the registrant filed all documents and reports required to be
filed by Section 2, 13 or 15(d) of the Exchange Act after the distribution of
securities under a plan confirmed by a court.
Yes   X     No ______

                      APPLICABLE ONLY TO CORPORATE ISSUERS

State the number of shares outstanding of each of the issuer's classes of common
equity, as of the latest practicable date: 2,034.704.



                                       1
<PAGE>



                             SOLITRON DEVICES, INC.

                                      INDEX

PART 1 - FINANCIAL INFORMATION

Item      1.  Financial Statements (unaudited):

               Condensed Consolidated Balance Sheet -- May 31, 1999

               Condensed Consolidated Income Statement -- Three Months Ended May
               31, 1999 and 1998

               Condensed Consolidated Statements of Cash Flows -- Three Months
               Ended May 31, 1999 and 1998

               Notes to Condensed Consolidated Financial Statements

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


PART II - OTHER INFORMATION

Item      1.  Legal Proceedings

Item      2.  Changes in Securities

Item      3.  Defaults Upon Senior Securities

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

Item      5.  Other Information

Item      6.  Exhibits and Reports on Form 8-K

Signatures



                                       2
<PAGE>





                         PART I - FINANCIAL INFORMATION


ITEM 1.  Financial Statements:  Pages  4 - 14


ITEM 2.  Management's Discussion and Analysis of Financial Condition and Results
          of Operations:  Pages  15- 20



                                       3
<PAGE>






                     SOLITRON DEVICES, INC. AND SUBSIDIARIES

                      CONDENSED CONSOLIDATED BALANCE SHEET

                                     ASSETS

                                                                  MAY 31, 1999
                                                                  ------------
                                                                   (Unaudited)

CURRENT ASSETS:

    Cash and cash equivalents                                     $   603,000
    Accounts receivable, less allowance
      for doubtful accounts of $11,000                                943,000
    Inventories                                                     2,905,000
    Prepaid expenses and other current assets                         136,000
    Due from Vector                                                     5,000
                                                                   ----------

    Total current assets                                          $ 4,592,000

PROPERTY, PLANT AND EQUIPMENT, net                                    574,000
NON-OPERATING PLANT FACILITIES, net of cost
    to dispose                                                            -0-

OTHER ASSETS                                                           83,000
                                                                   -----------

                                                                  $ 5,249,000
                                                                   ===========


                  The accompanying notes are an integral part
                     of these condensed financial statements



                                       4
<PAGE>




                     SOLITRON DEVICES, INC. AND SUBSIDIARIES

                      CONDENSED CONSOLIDATED BALANCE SHEET
                             (DOLLARS IN THOUSANDS)


LIABILITIES AND STOCKHOLDERS' EQUITY

CURRENT LIABILITIES:
    Current maturities of long-term debt                            $     7,000
    Current portion of accrued environmental expenses                   440,000
    Accounts payable - Post petition                                    360,000
    Accounts payable - Pre-petition, current portion                    129,000
    Accrued expenses                                                  2,254,000
    Accrued Chapter 11 administrative expense                            15,000
                                                                    -----------

      Total current liabilities                                     $ 3,205,000


LONG-TERM DEBT, less current maturities                                   6,000

OTHER LONG-TERM LIABILITIES net of current portion,
      net of cost to dispose of non-operating plant facilities          512,000
                                                                        -------

TOTAL LIABILITIES                                                   $ 3,723,000

STOCKHOLDERS' EQUITY:
    Preferred stock, $.01 par value,
     authorized 500,000 shares,
     0 shares issued and outstanding                                         -0-

    Common stock $.01 par value,
     authorized 10,000,000 shares,
     issued and outstanding 2,034,704                                    20,000

    Additional paid-in capital                                        2,618,000

    Accumulated deficit                                              (1,112,000)
                                                                    -----------
     Total shareholder equity                                         1,526,000
                                                                    -----------

                                                                    $ 5,249,000
                                                                    ===========


                  The accompanying notes are an integral part
                     of these condensed financial statements



                                       5
<PAGE>




                     SOLITRON DEVICES, INC. AND SUBSIDIARIES

                 CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
                                   (UNAUDITED)


                                                 THREE MONTHS ENDED MAY 31,
                                                     1999             1998
                                                 --------------------------

NET SALES                                        $ 1,935,000      $ 2,103,000
Cost of sales                                      1,530,000        1,554,000
                                                 -----------      -----------

Gross Profit                                         405,000          549,000
Selling, general and administrative expenses         282,000          337,000
                                                 -----------      -----------

Operating  income                                    123,000          212,000
                                                 -----------      -----------


OTHER INCOME (EXPENSE):
   Other income                                       11,000            9,000
   Interest expense                                  (45,000)         (89,000)
   Other                                              (5,000)         (12,000)
                                                 -----------      -----------

 Net other expense                                   (39,000)         (92,000)
                                                 -----------      -----------

 Net income                                      $    84,000      $   120,000
                                                 ===========      ===========

INCOME PER SHARE:                                $       .04      $       .06

WEIGHTED AVERAGE SHARES
   OUTSTANDING                                     2,034,704        2,034,704





                  The accompanying notes are an integral part
              of these condensed consolidated financial statements



                                       6
<PAGE>
<TABLE>
<CAPTION>



                     SOLITRON DEVICES, INC. AND SUBSIDIARIES
                 CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS
                                   (UNAUDITED)

                                                                                Three Months Ended May 31,
                                                                                     1999           1998
                                                                               ----------------------------
<S>                                                                             <C>            <C>

CASH FLOWS FROM OPERATING ACTIVITIES:
      Net profit                                                                $  84,000      $ 120,000
                                                                                ---------      ---------

Adjustments to reconcile net loss to
      Net cash used in operating activities:
           Depreciation and amortization                                           52,000         50,000
           (Increase) decrease in accounts receivable                             169,000         16,000
           (Increase) decrease in inventories                                    (168,000)       (63,000)
           (Increase) in prepaid expenses
             and other current assets                                             (17,000)       (31,000)
           Decrease in due from Vector                                             (2,000)        (1,000)
           Increase (decrease) in accounts payable                               (240,000)       (90,000)
           Increase in accrued expenses
             and other liabilities                                                  2,000         94,000
           Increase in accrued Chapter 11
             administrative expenses                                              (12,000)        16,000
                                                                                ---------      ---------


Total adjustments                                                                (216,000)        (9,000)
                                                                                ---------      ---------

      (Net Cash  required by) / Net cash generated from
      operating activities                                                       (132,000)       111,000
                                                                                ---------      ---------

CASH FLOW FROM INVESTING ACTIVITIES:

      Proceeds from the disposal of assets, additions
      to property, plant and equipment                                            (39,000)       (46,000)
                                                                                ---------      ---------

           Net Cash used in investing activities                                  (39,000)       (46,000)
                                                                                ---------      ---------

CASH FLOWS FROM FINANCING ACTIVITIES:
      Payments on capital leases                                                  (10,000)        (2,000)
                                                                                ---------      ---------

           Net cash used in financing activities                                  (10,000)        (2,000)
                                                                                ---------      ---------

NET INCREASE (DECREASE) IN CASH                                                  (181,000)       (63,000)

CASH AT BEGINNING OF PERIOD                                                     $ 784,000      $ 650,000
                                                                                ---------      ---------

CASH AT END OF PERIOD                                                           $ 603,000      $ 713,000
                                                                                =========      =========
</TABLE>

Supplemental cash flow disclosure: Interest paid during the three months ended
May 31, 1999 and 1998 was approximately $21,000 and $30,000 respectively.

                   The accompanying notes are an integral part
              of these condensed consolidated financial statements



                                       7
<PAGE>



                     SOLITRON DEVICES, INC. AND SUBSIDIARIES

              NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
                                   (UNAUDITED)

1.     GENERAL:

The financial information included herein is unaudited; however, such
information reflects all adjustments (consisting solely of normal recurring
adjustments), which are, in the opinion of management, necessary for a fair
statement of the results for the interim period.

The accompanying unaudited interim condensed consolidated financial statements
have been prepared pursuant to the rules and regulations of the Securities and
Exchange Commission for reporting on Form 10-QSB. Pursuant to such rules and
regulations, certain information and footnote disclosures normally included in
financial statements prepared in accordance with generally accepted accounting
principles have been condensed or omitted.

The information contained in this Form 10-QSB should be read in conjunction with
the Notes to Consolidated Financial Statements appearing in the Company's Annual
Report on Form 10-KSB for the year ended February 28, 1999.

The results of operations for the three-month period ended May 31, 1999 are not
necessarily indicative of the results to be expected for the year ended February
28, 2000.

As previously noted in documents filed with the SEC, on August 20, 1993, the
United States Bankruptcy Court for the Southern District of Florida (the
"Bankruptcy Court") entered an Order (the "Order of Confirmation") confirming
the Company's Fourth Amended Plan of Reorganization, as modified by the
Company's First Modification of Fourth Amended Plan of Reorganization (the "Plan
of Reorganization"). The Plan became effective on August 30, 1993 (the
"Effective Date"). On July 12, 1996, the Bankruptcy Court officially closed the
case.

Additionally, the following actions or events have taken or will take place
pursuant to the Plan of Reorganization:

Pursuant to the Plan of Reorganization, beginning in approximately May 1995, the
Company was required to begin making quarterly payments to holders of unsecured
claims until they receive 35% of their claims. However, due to negotiations
between the parties, the unsecured creditors agreed to a deferment of this
payment (for more discussion see Management's Discussion and Analysis). The
Company has proposed to its unsecured creditors that it make quarterly payments
of $9,000, a level of payment which was maintained until February 28, 1997.
Following discussion with the unsecured creditors committee, the Company agreed
to increase the level of such payments to approximately $11,000 per quarter
starting August 1997. Furthermore, effective August 1998, the Company started
making payments of $14,000 per quarter. To date, the Company made 17 of its
proposed distributions to the unsecured creditors who have accepted the
payments. These payments to unsecured creditors covered the period March 1, 1995
through May 28, 1999 in the aggregate amount of approximately $204,000 of the
approximately $1,076,000 required by the Plan of Reorganization. Following the
settlement with the State of California of the amount of its unsecured claim (as
described below in (j) below) and the Company's acquisition of the unsecured
claim of Argo Partners, Inc. (as described below in (o) below), it is presently
estimated that there are an aggregate of approximately $7,095,000 in unsecured
claims and, accordingly, that the Company is required to pay approximately
$2,292,000 to holders of allowed unsecured claims in quarterly installments of
approximately $62,083. The Company carries its debt to its unsecured creditors
as $117,000 in short-term debt and $1,173,000 in long-term debt. The aggregate
and monthly payments to unsecured creditors increases and decreases in
proportion to $10,000 per month per $3.5 million in allowed claims, subject to a
maximum quarterly payment of $105,000.



                                       8
<PAGE>



                     SOLITRON DEVICES, INC. AND SUBSIDIARIES

              NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
                                   (UNAUDITED)

USEPA is currently conducting a fund lead Remedial Investigation/Feasibility
Study (RI/FS) of the Port Salerno Property. The Company has signed consent to
access and is cooperating with the agency. USEPA anticipates completing the
RI/FS during the year 2000. USEPA and Martin County are evaluating any impact to
off-site private drinking water wells.

USEPA has completed a draft Remedial Investigation and Baseline Risk Assessment
for the Riviera Beach Property. Honeywell, Inc. has signed an Administrative
Order on Consent to perform the Feasibility Study for the Riviera Beach
Property. The Company has signed for purposes of granting USEPA and Honeywell
access. Honeywell is the predecessor owner and operator of the property during a
period when pollution occurred and is therefore jointly and severally liable to
USEPA. Honeywell's remedial action Feasibility Study (FS) may be completed in
1999. At that time, USEPA will propose a plan of action to the community, to
clean up the contamination. A public meeting will be held and comments on the
proposed plan will be accepted. Based on the comments, USEPA may or may not
revise the plan and prepare a remedial action Record of Decision (ROD). USEPA
expects to sign a ROD for the Riviera Beach property before January 2000. Due to
the nature of ground water contamination sites in Florida, cleanup is expected
to take decades.

The Company has entered into negotiations with USEPA to settle USEPA's cost
claims against it arising from the costs USEPA incurs in remediating or
overseeing the remedial activities of others in connection with the properties.
There can be no assurance as to the outcome of such negotiations. The Company
has provided full information of its financial condition and has stated that
except for the value of the properties upon sale, it does not have the ability
to pay any USEPA claim under the Superfund's "Ability To Pay" mechanism.

The Company offered to sell the properties at market value and after deducting
its costs including $125,000 attorneys fees associated with the Riviera Beach
Property and $75,000 attorneys fees associated with the Port Salerno Property,
5% broker's fee, back taxes plus interest, and the closing costs, to pay the net
proceeds of the sales to USEPA to discharge all USEPA claims. USEPA has agreed
to consider entering into prospective purchaser agreements protecting the
property purchasers from USEPA cost recovery claims and third party contribution
claims, but is not willing to deduct legal fees of more than $25,000 and $20,000
from the Riviera Beach and Port Salerno properties, respectively. Since this
leaves the Company no way to pay its legal fees to its outside environmental
counsel, that counsel has had to withdraw from the legal representation. The
Company appointed a new environmental counsel.

Currently, the Riviera Beach Property is under contract with National Land
Company ("NLC") for market value of approximately $1,000,000. USEPA is currently
negotiating a prospective purchaser agreement with NLC, subject to appropriate
deductions from the purchase price paid to USEPA, for back property taxes and
interest, legal fees in the amount of $25,000, 5% broker's fee, and closing
costs. Under these terms, NLC would pay USEPA $419,000 in net purchase proceeds.
USEPA is also seeking to have the environmental escrowed monies relating to the
Riviera Beach Property paid over to it by FDEP and the Company to defray its
cleanup costs. USEPA believes that it can compel Honeywell to complete the
cleanup of the Riviera Beach Property.

USEPA counsel had advised Solitron's counsel that once a prospective purchaser
agreement is signed, the property is sold, and USEPA receives the proceeds
($419,000) plus the fund available in the Riviera Beach escrow account, USEPA
will issue the Company and Honeywell a letter stating that it will not hold them
liable for any additional past response costs for the Riviera Beach site.
However, until the prospective purchaser agreement is signed by both the USEPA
and the prospective buyer and the sale is consummated, there can be no guarantee
that such transaction and release will take place.

USEPA advised the Company that it is unwilling to resolve its past and future
cleanup costs in relation to the Port Salerno site under the ability to pay
mechanism until the Port Salerno property is sold.



                                       9
<PAGE>




                     SOLITRON DEVICES, INC. AND SUBSIDIARIES

              NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
                                   (UNAUDITED)

It is the Company's position that any USEPA cost recovery claims are discharged
in the prior bankruptcy and that USEPA is bound by the terms of the remediation
approved under the Amended Order of Confirmation in Bankruptcy. Though USEPA
received notice of Solitron's Bankruptcy, had knowledge of FDEP's claim and
participation in the Bankruptcy, and that it likewise had already incurred costs
to investigate the properties, USEPA did not file a claim in the Bankruptcy,
apparently deferring to FDEP's claims regarding the remediation of the
properties. USEPA does not agree with the Company's conclusion that its claims
have been discharged in the bankruptcy.

It is the Company's position that its legal exposure to Honeywell for
contribution to cleanup costs has been resolved in the bankruptcy, since
Honeywell's claims were filed and resolved in bankruptcy.

On June 25, 1999, the Company received notification from the USEPA that the
latter perfected liens against Solitron Devices Riviera Beach and Port Salerno
sites. The company is appealing these liens on the basis that USEPA failed to
file claims in bankruptcy court.

On July 6, 1999 the buyer received from the USEPA the Proposed Prospective
Purchaser Agreement. On July 15, 1999 the contract was signed by the buyer and
returned to the USEPA for signature. When the USEPA has signed the contract they
and the Department of Justice should publish the aforementioned agreement in the
Federal Register. After the 30 day period allowed for public notice, the sale of
the Riviera Beach Property should be finalized.

The Company's former facility in Jupiter, Florida was sold to Philips
Electronics in 1982. In 1995 the Jupiter facility was the subject of a
preliminary assessment by the USEPA. After its investigation, USEPA deferred any
further remedial action to an FDEP lead. The Company's environmental legal
counsel has been advised that this facility is being remediated and such
remediation will be completed under a consent order with FDEP. By letter dated
May 17, 1999, Philips put the Company on notice that it will seek to exercise
its indemnity rights against the Company under the 1982 purchase and sale
agreement. It is the Company's position that Philips' notice of and
participation in the prior bankruptcy has discharged Philips' claims. For a
further description of the Company's environmental issues, refer to "Item 1 -
Business - Bankruptcy Proceedings" and to Note 12 of the accompanying
Consolidated Financial Statements in the Company form 10KSG for the fiscal year
ending February 28, 1998.

The Company has not been making payments to Palm Beach County or to Martin
County. It is anticipated that the Martin County tax claim will be paid in full
with the sale of the Port Salerno property. It is anticipated as well that the
Palm Beach County Tax claim will be paid with the sale of the Riviera Beach
property. The following table indicates the approximate cumulative status of
amounts due under Court Plans as of May 31, 1999:

                                          DUE TO DATE                    PAID
                                          -----------                    ----
              Martin County                  $ 79,000                $  8,000

              Palm Beach County              $882,000                $280,000




                                       10
<PAGE>



                     SOLITRON DEVICES, INC. AND SUBSIDIARIES

              NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
                                   (UNAUDITED)

The pre-petition taxes owed to Palm Beach County arose from three sources: (a)
tangible personal property, (b) real property formerly owned by the Company, but
subsequently transferred to other entities, and (c) real property currently
owned by the Company. Following the confirmation of the Company's plan of
reorganization, Palm Beach County received funds in partial payment of these tax
liabilities. The Company believes that Palm Beach County applied these funds
without regard to the purpose for which they were being paid (e.g., payments
toward tangible personal property taxes were applied by the County against
amounts owed on real property taxes). There exist issues between the Company and
the County with regard to the proper application of the subject tax payments for
the three categories of property, and until these issues are resolved, the
precise amounts owed for tangible personal property taxes and real property
taxes for the pre-petition period cannot be stated with certainty.

To date, no objections have been raised regarding the amounts of the Company's
payments to these taxing authorities. However, no assurances can be made that
such an objection will not be raised in the future concerning the Company's
obligations to those taxing authorities or that any of the Company's
negotiations to restructure its payment obligations will be successful.

2.    FINANCIAL CONDITION:

During the last several fiscal years, the Company has generally experienced
losses from operations and severe cash shortages caused by a significant decline
in both sales and open order backlog, decreased margins (which is characteristic
in the industry) on the Company's products, significant expenses associated with
the reorganization proceedings, and the Company's inability to obtain additional
working capital through the sale of debt or equity securities or the sale of
non-operating assets. However, for the years ended February 28, 1999 and
February 28, 1998, the Company recorded net income of $476,000 and $194,000
respectively.

During the pendency of the Bankruptcy Proceedings, all secured and unsecured
claims against and indebtedness of the Company (including accrued and unpaid
interest) were stayed in accordance with the Bankruptcy Code while the Company
continued its operations as a debtor-in-possession, subject to the control and
supervision of the Bankruptcy Court. Because these stays limit cash outflow, the
Company, during the pendency of the Bankruptcy Proceedings, realized positive
cash flow from ongoing operations. Since the Company emerged from Chapter 11, it
has experienced a positive cash flow from recurring operations; however, until
the fiscal year ended February 28, 1997, overall cash flow was negative due
primarily to the necessity to make payments of administrative expenses and
unsecured debt payout arising in connection with the Bankruptcy Proceedings. The
foregoing resulted in a decrease in cash and cash equivalents since emergence
from Chapter 11. The Company has projected that it will continue to be able to
generate sufficient funds to support its ongoing operations. However, the
Company must be able to renegotiate its required payments to unsecured
creditors, the USEPA, the FDEP and certain taxing authorities or raise
sufficient cash in order to pay these obligations as currently due, in order to
remain a going concern.

The Company is currently in negotiations with the unsecured creditors, the
USEPA, the FDEP, and taxing authorities in an attempt to arrive at reduced
payment schedules. In addition, the Company has a contingency plan to reduce its
size and thereby reduce its cost of operations within certain limitations.
However, no assurance can be made that the Company can reach a suitable
agreement with the unsecured creditors, USEPA, FDEP or taxing authorities or
obtain additional sources of capital and/or cash or that the Company can
generate sufficient cash to meet its obligations.



                                       11
<PAGE>



                     SOLITRON DEVICES, INC. AND SUBSIDIARIES

              NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
                                   (UNAUDITED)

ENVIRONMENTAL REGULATION

While the Company believes that it has the environmental permits necessary to
conduct its business and that its operations conform to present environmental
regulations, increased public attention has been focused on the environmental
impact of semiconductor operations. The Company, in the conduct of its
manufacturing operations, has handled and does handle materials that are
considered hazardous, toxic or volatile under federal, state, and local laws
and, therefore, is subject to regulations related to their use, storage,
discharge, and disposal. No assurance can be made that the risk of accidental
release of such materials can be completely eliminated. In the event of a
violation of environmental laws, the Company could be held liable for damages
and the costs of remediation and, along with the rest of the semiconductor
industry, is subject to variable interpretations and governmental priorities
concerning environmental laws and regulations. Environmental statues have been
interpreted to provide for joint and several liability and strict liability
regardless of actual fault. There can be no assurance that the Company and its
subsidiaries will not be required to incur costs to comply with, or that the
operations, business, or financial condition of the Company will not be
materially adversely affected by current or future environmental laws or
regulations.

The Order of Confirmation (the "Confirmation Order") approving the Company's
Amended Plan of Reorganization with First Modification (the "Plan") was issued
by the Bankruptcy Court on August 20, 1993 (the "Confirmation Date"), and
incorporated a plan for future remediation of the two properties of the Company
dependent upon the properties being sold and the purchase price being applied to
remediation costs. One property is Lot 1 (the north parcel) of the property at
1177 Blue Heron Road in the City of Riviera Beach, Florida (the "Riviera Beach
Property"), and the second is its former Port Salerno facility, S.E. Cove Road,
Port Salerno, Martin County, Florida (the "Port Salerno Property").

Contemporaneously with the Confirmation Order, the Company and the State of
Florida Department of Environmental Protection (the "FDEP") entered into a
Stipulation for entry of a Consent Final Judgment in the Circuit Court of the
Nineteenth Judicial Circuit of Florida in and for Martin County, Florida. The
Consent Final Judgment, entered by the Court on October 21, 1993, provided that
the Company would: (a) reimburse FDEP $200,000 for providing main and lateral
water line extensions and property hookups to serve eight off-site properties
presently impacted by the groundwater contamination emanating from the Port
Salerno Property (paid as an administrative expense in accordance with the
Confirmation Order); (b) remediate site soils and groundwater at and emanating
from the Port Salerno Property; (c) address residual soil contamination and a
limited, defined "hot spot" in the groundwater at and near the north end of the
Riviera Beach Property; and (d) pay a final judgment of $102,860.57 to be paid
to FDEP pursuant to the Plan in the manner and to the extent of the Company's
payment of other unsecured creditor claims.

Pursuant to the Confirmation Order, all existing security interests on these two
properties, except real estate taxes, were removed. At the time, the properties
were appraised by an MAI appraiser, as if uncontaminated, at $1,950,000 for the
Riviera Beach Property and $1,650,000 for the Port Salerno Property. Under the
Plan and Consent Final Judgment, the Company was directed to sell or lease the
two properties and utilize the proceeds derived therefrom, together with certain
insurance proceeds, to remediate both sites. All such proceeds were to be placed
in escrow for that purpose. Under the Plan, any excess funds after all escrow
obligations were satisfied were to belong to the Company.

The City of Riviera Beach previously settled its claim with the Company for
cleanup of contamination of its wellfield, except for the "hot spot" to be
addressed by the Company as required by the Consent Final Judgment. The unpaid
balance of the settlement amount with the City was approved in the Confirmation
Order, to be paid as and to the extent provided for other unsecured creditors.
After notice, no other claims were filed in the bankruptcy


                                       12
<PAGE>

                     SOLITRON DEVICES, INC. AND SUBSIDIARIES

              NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
                                   (UNAUDITED)

proceeding related to offsite groundwater contamination associated with the
Riviera Beach Property, and potential claims may have been extinguished thereby.

At the time of the Plan and Consent Final Judgment, the Company's consultant
estimated the costs of remediation pursuant to the Consent Final Judgment to be
approximately $727,000 for the Port Salerno Property and $342,000 for the
Riviera Beach Property. Approximately $1,029,000 has been accrued in the balance
sheet as of May 31, 1999. The Company recorded these liabilities as $440,000
short-term liabilities and $589,000 long-term liabilities. These reservations
are predicated on cleanup being performed under the existing Plan and Consent
Final Judgment. The consultant estimated that remediation costs could be
greater, particularly if further offsite wells became contaminated in Port
Salerno and the affected properties must be supplied public water by further
extension of the water lines. All residents who could be potentially affected by
further groundwater plume movement in Port Salerno were notified of the pendency
of the bankruptcy and that claims could be filed. The claims filed, except as
set forth below, have been settled. The consultant did not estimate remediation
costs were the United States Environmental Protection Agency to take the lead
over the cleanup.

The Company received a claim by an estate-owned property northwest and across
Cove Road from the Port Salerno Property. The estate has asserted that the
mailing address to which the bankruptcy notice was sent was in error. The estate
has been advised that public water has been made available to its property and
that the Company is prepared to settle for the sum of $10,000, to be paid as
other unsecured credit claims are being paid. This offer was rejected. The claim
is unresolved and is currently dormant.

The Company's position has been that further off-site exposure to third party
property owners at Port Salerno is limited by its Chapter 11 proceeding solely
to its obligation for extension of public water lines to the affected property.
It cannot now be estimated whether some future extension may be required, but
the contaminated groundwater appears to move slowly and any remediation will
likely entail off-site recovery wells to contain its further movement.

Under the Plan, if funds to clean the properties were not available within 24
months of entry of the Consent Final Judgment, the Company, beginning in October
1995, was to make periodic payments into an escrow account to clean both
properties based on the following schedule:

1.     Commencing on the 25th month, $5,000 per month, and
2.     Commencing on the 37th month, $7,500 per month, and
3.     Commencing on the 49th month, $10,000 per month.

Periodic funding was to have been suspended when funds available in escrow
reached 125% of the estimated costs to complete remediation. The Plan does not
require the Company to pay additional funds in excess of the schedule set forth
above, except that if funds are not available in the escrow for that purpose,
the Company must independently fund any further extension of public water supply
lines in the vicinity of the Port Salerno Property. The Consent Final Judgment
requires providing any such extension within a reasonable time. The prior
payment to the state has extended the large water main to provide service to the
area. The further extension would be for lateral extensions and individual
property hookups.

In October 1995, the Company advised the FDEP that it could pay only $1,000 per
month into escrow, rather than the amounts specified by the Consent Final
Judgment. Since then, the Company has paid $1,000 per month into the escrow for
the properties. The total escrow amounts for the properties, as of May 31, 1999
is $46,000. FDEP has acquiesced in this payment level.

Under the Plan and Consent Final Judgment, the Company's consultant undertook
additional soil contamination assessment of the Riviera Beach Property and
received FDEP approval of the consultant's contamination assessment report
recommendation that no further soil remediation is required. Similarly, the
consultant



                                       13
<PAGE>



                     SOLITRON DEVICES, INC. AND SUBSIDIARIES

              NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
                                   (UNAUDITED)

completed soil contamination assessment work at the Port Salerno Property and
FDEP agreed with the consultant's submitted data and analysis that no further
soil remediation is required.

Despite the Plan and Consent Final Judgment and the Company's repeated efforts
to negotiate a deferral of action by the United States Environmental Protection
Agency ("USEPA") to allow the Company to sell the properties, the USEPA
re-evaluated the Riviera Beach and Port Salerno properties for potential listing
on the Superfund National Priority List ("NPL"). During 1997, USEPA required the
Company to sign site access agreements permitting USEPA to perform expanded site
assessments at the properties. The Company was able to secure a 90-day deferral
of further NPL listing evaluation in an attempt to allow prospective purchasers
to complete due diligence on the properties. USEPA subsequently published notice
of its proposal to list the Port Salerno Property on the NPL and listed it on
July 27, 1998. By letter dated June 16, 1998, USEPA required the Company to
consent to allow USEPA access to the Riviera Beach Property to complete a
Remedial Investigation. By letter dated September 8, 1998, USEPA notified the
Company that it would not defer cleanup of the Riviera Beach Property to a FDEP
lead. USEPA stated, however, that it would defer listing the Riviera Beach
Property on the NPL if prior owner/operator Honeywell, Inc. agreed to proceed
with and fund an USEPA-lead voluntary Superfund cleanup. USEPA expressed
willingness to negotiate a prospective purchaser agreement with any purchaser
interested in redeveloping the Riviera Beach or Port Salerno properties.

During the fiscal year ended February 28, 1999, the Company has spent
approximately $13,000 for compliance with environmental laws (federal, state and
local). As part of this effort, the Company retained the services of an
environmental consultant who assisted in verifying that the Company operates in
compliance with all pertinent environmental laws and regulations.

Whether Honeywell succeeds in obtaining approval to perform the cleanup under
the State Consent Order should be clarified over the next few months. In all
events, the Company has offered Honeywell site access and is nearing agreement
on terms of such access to permit Honeywell to perform the required cleanup
without participation by the Company. In all events, the position of the Company
is that Honeywell's claim for cleanup and the potential claim of EPA, if
asserted against the company, are barred by the Bankruptcy Court Order. For
additional discussion about the Company's effort to sell the Riviera Beach
facility see "Notes to Condensed Consolidated Financial Statements (c)".



                                       14
<PAGE>




                     SOLITRON DEVICES, INC. AND SUBSIDIARIES

                MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
                       CONDITION AND RESULTS OF OPERATIONS

Item 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
        OF OPERATIONS

The following discussion and analysis of factors which have affected the
Company's financial position and operating results during the periods included
in the accompanying condensed consolidated financial statements should be read
in conjunction with the Consolidated Financial Statements and the related Notes
to Consolidated Financial Statements and Management's Discussion and Analysis of
Financial Condition and Results of Operations included in the Company's Annual
Report on Form 10-KSB for the year ended February 28, 1999 and the Condensed
Consolidated Financial Statements and the related Notes to Condensed
Consolidated Financial Statements included in Item 1 of this Quarterly Report on
Form 10-QSB.

INTRODUCTION:

Except for historical information contained herein, certain matters discussed
herein are forward-looking statements made pursuant to the safe harbor
provisions of the Securities Litigation Reform Act of 1995. These
forward-looking statements are based largely on the Company's expectations and
are subject to a number of risks and uncertainties, including but not limited
to, economic, technological, competitive, governmental procurement, regulatory,
strategies, available financing, and other factors discussed elsewhere in this
report and in the documents filed by the Company with the SEC. Many of these
factors are beyond the Company's control. Actual results could differ materially
from the forward-looking statements. In light of these risks and uncertainties,
there can be no assurance that the forward-looking information contained in this
report will, in fact, occur.

During the three months ended May 31, 1999, the company's book-to-bill ratio
rose to approximately 0.90, reflecting a change in the demand for the Company's
products and a lower average unit sale price. It is believed that such change in
the intake of orders has been the general experience of most semiconductor
manufacturers who participate in the same market as the Company. The Company
continued implementing steps intended to reduce its variable manufacturing cost
to offset the impact of lower average sale price. However, should order intake
decline, the company may be required to implement further cost-cutting or other
downsizing measures to continue its business operations. The Company's liquidity
continues to be adversely affected by significant non-recurring expenses
associated with the company's pre-petition obligations, and the Company's
inability to obtain additional working capital through the sale of debt or
equity securities or the sale of non-operating assets.

The Company currently believes, based on information available to it, that its
operations will continue to generate sufficient cash to satisfy its operating
needs over the next 12 months. However, based on the Company's current bookings,
prices, profit margins and sales levels, the Company does not believe it will
generate sufficient cash to satisfy both its operating needs and its obligations
to pre-bankruptcy creditors in accordance with the Plan of Reorganization. Thus,
the Company is in negotiations with all such claim holders to reschedule the
Company's payments. In the event the Company is unable to restructure its
obligations to pre-bankruptcy claimants, the Company will be required to further
reduce its size and reduce its cost of operations. However, over the long term,
the Company believes that if the volume and prices of its product sales continue
as presently anticipated, it will, subject to the continued deferral of certain
obligations, generate sufficient cash from operations to sustain its current
operations. In the event that sales decline significantly below the current
level experienced by the Company, the Company may be required to implement
further cost-cutting or other downsizing measures to continue its business
operations. Although the Company is pursuing additional sources of financing,
there can be no assurance that financing will be available in amounts or upon
terms sufficient to meet the Company's needs. However, in appropriate
situations, the Company may seek strategic alliances, joint ventures with
others, or acquisitions in order to maximize the Company's marketing potential,
its utilization of existing resources, and to provide further opportunities for
growth.


                                       15
<PAGE>

                     SOLITRON DEVICES, INC. AND SUBSIDIARIES

                MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
                       CONDITION AND RESULTS OF OPERATIONS
                                   (CONTINUED)

RESULTS OF OPERATIONS-THREE MONTHS ENDED MAY 31, 1999 COMPARED TO THREE MONTHS
ENDED MAY 31, 1998:

Net sales for the three months ended May 31, 1999 decreased 8% to $1,935,000 as
compared to $2,103,000 for the three months ended May 31, 1998. Such decrease
was primarily attributable to weak backlog and scheduling requirements of the
Company's customers. The Company's backlog of open orders decreased 3.2% for the
three months ended May 31, 1998 as compared to a decrease of 14.9% for the three
months ended May 31, 1998 Such decrease is attributable to lower demand for the
Company's product, resulting from the cut in defense spending and lower average
sales price and general slowdown for semiconductors experienced industry wide.
Gross margins on the Company's sales decreased to 20.9% for the three months
ended May 31, 1999 in comparison to 26.1% for the three months ended May 31,
1998. This decrease is the result of a less favorable product mix, and an
increase in the cost of goods sold. Gross profit for the three months ended May
31, 1999 decreased to $405,000 from $549,000 for the three months ended May 31,
1998. This decrease is primarily due to declined sales volume and an increase in
the cost of goods sold as a percentage of sales.

For the three months ending May 31, 1999, the Company shipped 323.713 units as
compared with 656.489 units shipped during the same period of the prior year. It
should be noted that since the Company manufactures a wide variety of products
with an average sale price ranging from less than one dollar to several hundred
dollars, such periodic variations in the Company's volume of units shipped may
not be a reliable indicator of the Company's performance.

The company has experienced an increase in the level of booking of approximately
31% for the quarter ended May 31, 1999 as compared to the same period for the
previous year principally as a result of the Company's product being designated
for use in programs that received long range funding by the Defense Department.

Selling, General, and Administrative expenses decreased to $282.000 for the
three months ended May 31, 1999 from $337,000 for the comparable period in 1998.
During the three months ending May 31, 1999, Selling, General, and
Administrative expenses as a percentage of sales totaled 14.58% as compared with
16.02% for the three months ending May 31, 1998. The decrease was due primarily
to lower salaries and lower commissions which were due to lower sales volume.

Operating income for the three months ended May 31, 1999 decreased to $123,000
from $212,000 for the three months ended May 31, 1998. This decrease is
principally due to a lower sales volume which was partially offset by a decrease
in the cost of goods sold as percentage of sales, and by a decrease in Selling,
and General and Administrative expenses.

The Company recorded a net other expense of $39,000 for the three months ended
May 31, 1999 versus a net other expense of $92,000 for the three months ended
May 31, 1998. The variance was due to decreases in the Company's interest
expense for the three months period of 1999.

Net income for the three months ended May 31, 1999 decreased to $84,000 versus
$121,000 for the same period in 1998. The major contributing factor to this
decrease was decreased sales volume offset by lower cost of sales and lower
operating expenses.



                                       16
<PAGE>




                     SOLITRON DEVICES, INC. AND SUBSIDIARIES

                MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
                       CONDITION AND RESULTS OF OPERATIONS
                                   (CONTINUED)

LIQUIDITY AND CAPITAL RESOURCES

The Company reported a net income of $84,000 and operating income of $123,000
for the three months ended May 31, 1999. However, the Company has significant
obligations arising from settlements related to its bankruptcy proceeding which
requires it to make substantial cash payments which cannot be supported by the
Company's current level of operations.

At May 31, 1999, February 28, 1999 and May 31, 1998 respectively, the Company
had cash and cash equivalents of $603,000, $784,000 and $713,000. This decrease
was primarily the result of the Company settling with the IRS its 1987 tax
obligations.

At May 31, 1999, the Company had working capital of $1,387,000 as compared with
a working capital at May 31, 1998 of $1,251,000. At February 28, 1999, the
Company had a working capital of $1,340,000. The approximately $47,000 change
for the three months ended May 31, 1998 was due partly to an increase in
pre-paid expenses and partly to an increase in inventory.

Pursuant to the Plan or Reorganization, the Company is required to pay an
aggregate of approximately $2,483,338 to holders of allowed unsecured claims in
quarterly installments of approximately $62,083. The Company has proposed to its
unsecured creditors that it reduce its payments to quarterly payments of $9,000.
Following discussions between the Company and the unsecured creditors committee,
the Company agreed to make quarterly payments of $11,000 starting August 1997.
Furthermore, effective August 1998, the Company started making payments of
$14,000 per quarter. As of May 31, 1999, the Company had paid to the unsecured
creditors approximately $204,000 of the $1,076,000 due. Of amounts owed to
unsecured creditors $129,000 is carried as short-term debt and $1,173,000 is
carried as long-term debt.

Pursuant to the terms of the Plan of Reorganization and Consent Final Judgment,
the Company is required to complete the assessment and remediation of the Port
Salerno facility and the old Riviera Beach facilities. The costs of these
assessments and remediations, estimated at $1,042,000, will be payable from the
proceeds of the sale or lease of these properties. As part of these
requirements, the Company performed soil remediation assessment at both
facilities. These tests indicated that no soil remediation is required at the
Port Salerno and old Riviera Beach facilities and the DEP has concurred that no
further soil remediation is required at either property. The Company is
renegotiating with DEP the terms of the cash payments into the aforementioned
escrow account and, while the negotiations are under way, the Company deposits
$1,000 per month. As of May 31, 1999, the Company had deposited $46,000 of the
$120,000 due in accordance with the Plan into the escrow account.

For discussion regarding the status of the sale of the Riviera Beach facility,
please see section 1 of "Notes to Condensed Consolidated Financial Statements."



                                       17
<PAGE>



                     SOLITRON DEVICES, INC. AND SUBSIDIARIES

                MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
                       CONDITION AND RESULTS OF OPERATIONS
                                   (CONTINUED)

Pursuant to the Plan of Reorganization, beginning on the date the Company's net
after tax income exceeds $500,000, the Company would be required to pay certain
pre-petition creditors 10% of the amount of income that exceeds $500,000 until
August 30, 2003 up to a maximum aggregate of $3,000,000 in such payments.
Further, the Company's lease payments (less sublease payments from Vector) for
its facilities in West Palm Beach, Florida would increase each year from
approximately $255,000 during the current fiscal year in accordance with
specified cost of living increases of not more than 5% per year.

YEAR 2000

The Year 2000 computer problem, commonly referred to as the Y2K, creates a risk
for the Company and therefore the Company makes the following Year 2000
readiness disclosure. An adverse impact on operations could occur if computer
systems do not correctly recognize date information when the year changes to
2000. The Company's risk exists in the following areas: (1) systems used by the
Company to run its business and (2) systems used by suppliers and service
providers.

The Company has attempted to obtain assurances of Year 2000 readiness from
suppliers and service providers. The Company will continue to obtain such
assurances for future internal systems, equipment, and facilities. In addition,
we will continue to monitor, including performing additional testing, as
appropriate, the Year 2000 readiness status of previous obtained equipment,
internal systems, and facilities. Noncompliant systems, equipment, or facilities
are expected to be replaced or upgraded in a timely manner prior to December 31,
1999. The Company has not identified alternative remediation strategies if
replacement or upgrade is not feasible, but will continue to reevaluate the need
for alternative remediation strategies and contingency plans as warranted by
further risk analysis. For internal system Year 2000 noncompliance issues
identified to date and expected throughout 1999, the cost of upgrade or
replacement is not expected to be material to operating results. However, if
significant, new noncompliance issues are subsequently identified, and
replacement or upgrade is delayed beyond December 31, 1999, operating results
could be materially adversely affected. The Company has limited material
relationships with suppliers whose inability to provide products or services
would have a material adverse impact on operating results. Suppliers where such
material relationships do exist appear to be limited to those utilities (e.g.
phone service, public service) whose inability to provide service could
materially affect all business entities. The Company has and will continue to
monitor their Year 2000 efforts and will develop contingency plans as
appropriate.

In order to evaluate the above risks, implement any necessary remediations in
the future, and provide risk reevaluations and continued appropriate monitoring
activities, the Company has designated appropriate individuals within the
organization to be responsible for Year 2000 issues. The Company will continue
to assess the need for additional year 2000 readiness personnel as appropriate.

The Company's computer operating system and business software package have been
updated and, when tested on December 1998, found to be Y2K compliant. The
Company expects all of its internally written custom reports to be Y2K compliant
by September 30, 1999. As of April 30, 1999, fifty percent of such reports had
been updated and tested or have no Y2K impact. Having these custom management
reports updated to Y2K is not considered to be mission critical



                                       18
<PAGE>




                     SOLITRON DEVICES, INC. AND SUBSIDIARIES

                MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
                       CONDITION AND RESULTS OF OPERATIONS
                                   (CONTINUED)

In addition, the Company has contacted all of its business partners (i.e.,
services provider and raw material suppliers), and found that all of them are
Y2K compliant or plan to be compliant by the 3rd quarter of 1999. Based on the
currently available information, the Company does not anticipate any
interruption to its ability to continue conducting business. However, the
Company does not have control over such third parties and a failure of third
parties to be Y2K compliant could have a material impact on the Company's
ability to conduct business. Thus, the Company will continue to seek
confirmation and updates from its business partners to certify that they
addressed or will address year 2000 issues.

The cost of updating and testing the Company's year 2000 compliance has been
expensed as part of its operating expenses and was not material.



                                       19
<PAGE>







                           PART II - OTHER INFORMATION


Item 1.       LEGAL PROCEEDINGS:
None.


ITEM 2.
None.


ITEM 3.       DEFAULTS UPON SENIOR SECURITIES:
See Part 1.


ITEM 4.
None.


ITEM 5.
None.


ITEM 6.
None.



                                       20
<PAGE>




                                   SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, this report
has been signed by the following persons on behalf of Solitron and in the
capacities and on the date indicated.

SIGNATURE                            TITLE                         DATE
---------                            -----                         ----

/s/ SHEVACH SARAF
------------------------
Shevach Saraf                        Chairman,                     July 13, 1999
                                     President, and
                                     Chief Executive Officer

                                       21
<PAGE>



EXHIBIT INDEX

EXHIBIT
NUMBER                                            DESCRIPTION
-------                                           -----------

27                                                Financial Data Schedule