SECURITIES AND EXCHANGE COMMISSION

                             Washington, D.C. 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: June 30, 2002

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

                         Commission File Number 0-20837

                           Orion Acquisition Corp. II
             (Exact name of registrant as specified in its charter)



        Delaware                                          13-3863260
 (State of Incorporation)                     (IRS Employer Identification No.)


401 Wilshire Boulevard - Suite 1020
  Santa Monica, CA                                          90401
(Address of principal executive office)                  (Zip code)


       Registrant's telephone number, including area code: (310) 526-5000

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

As of June 30, 2002, 1,030,907 shares of Common Stock were issued and
outstanding.



<Page>
                                                      ORION ACQUISITION CORP. II
                                                   (A DEVELOPMENT STAGE COMPANY)
                                                                        CONTENTS
                                                       June 30, 2002 (unaudited)

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

                         PART I. FINANCIAL INFORMATION

ITEM 1: FINANCIAL STATEMENTS

                                                                        Page
FINANCIAL STATEMENTS

     Balance Sheet                                                      2

     Statements of Operations                                         3 - 4

     Statements of Cash Flows                                         5 - 6

     Notes to Financial Statements                                    7 - 10


                                      1
<Page>


                                                      ORION ACQUISITION CORP. II
                                                   (A DEVELOPMENT STAGE COMPANY)
                                                                   BALANCE SHEET
                                                       June 30, 2002 (unaudited)

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


                                     ASSETS

Assets
     Cash                                                       $     2,026,898
     Income taxes receivable                                             26,694
     Deferred tax assets                                                    221
     Other assets                                                        15,780
                                                                ----------------

                  Total assets                                  $     2,069,593
                                                                ================


                      LIABILITIES AND STOCKHOLDERS' EQUITY

Current liabilities
     Accrued expenses                                           $        32,333
                                                                ----------------

         Total current liabilities                                       32,333
                                                                ----------------

Contingencies

Stockholders' equity
     Preferred stock, $0.01 par value
         1,000,000 shares authorized
         110 shares (unaudited) issued and outstanding                        1
     Common stock, $0.01 par value
         10,000,000 shares authorized
         1,030,907 shares (unaudited) issued and outstanding             11,022
     Additional paid-in capital                                       2,203,043
     Deficit accumulated during the development stage                  (176,806)
                                                                ----------------

              Total stockholders' equity                              2,037,260
                                                                ----------------

                  Total liabilities and stockholders' equity    $     2,069,593
                                                                ================

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

                                        2

<Page>


                                                      ORION ACQUISITION CORP. II
                                                   (A DEVELOPMENT STAGE COMPANY)
                                                        STATEMENTS OF OPERATIONS
       For the Three and Six Months Ended June 30, 2002 and 2001 (unaudited) and
   for the Period from October 19, 1995 (Inception) to June 30, 2002 (unaudited)

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

<Table>
<Caption>

                                                                                                       For the
                                                                                                     Period from
                                        For the                            For the                   October 19,
                                  Three Months Ended                   Six Months Ended                 1995
                                        June 30,                           June 30,                 (Inception) to
                             ---------------------------------  ---------------------------------      June 30,
                                   2002              2001             2002              2001             2002
                             ---------------   ---------------  ----------------  ---------------  ----------------
                              (unaudited)       (unaudited)      (unaudited)       (unaudited)      (unaudited)
<S>                         <C>               <C>               <C>              <C>              <C>

Operating expenses
   General and
     administrative
     expenses                $        29,826   $        16,513  $         89,360  $        77,634  $      1,043,838
   Stock-based
     compensation
     expense                               -                 -                 -                -           100,000
                             ---------------   ---------------  ----------------  ---------------  ----------------

Total operating
   expenses                           29,826            16,513            89,360           77,634         1,143,838
                             ---------------   ---------------  ----------------  ---------------  ----------------

Loss from
   operations                        (29,826)          (16,513)          (89,360)         (77,634)       (1,143,838)
                             ---------------   ---------------  ----------------  ---------------  ----------------

Other income
   (expense)
     Interest income                   6,132            19,994            12,774           50,313         1,573,651
     Other income                          -                 -                 -                -             2,183
     Interest expense                      -                 -                 -                -           (57,694)
                             ---------------   ---------------  ----------------  ---------------  ----------------

Total other income
   (expense)                           6,132            19,994            12,774           50,313         1,518,140
                             ---------------   ---------------  ----------------  ---------------  ----------------

Income (loss) before
   provision for
   income taxes                      (23,694)            3,481           (76,586)         (27,321)          374,302

Provision for income
   taxes                                   -                 -                 -                -           268,467
                             ---------------   ---------------  ----------------  ---------------  ----------------

Net income (loss)            $       (23,694)  $         3,481  $        (76,586) $       (27,321) $        105,835
                             ===============   ===============  ================  ===============  ================

</Table>
   The accompanying notes are an integral part of these financial statements.

                                        3

<Page>


                                                      ORION ACQUISITION CORP. II
                                                   (A DEVELOPMENT STAGE COMPANY)
                                                        STATEMENTS OF OPERATIONS
       For the Three and Six Months Ended June 30, 2002 and 2001 (unaudited) and
   for the Period from October 19, 1995 (Inception) to June 30, 2002 (unaudited)

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

<Table>
<Caption>

                                                                                                       For the
                                                                                                     Period from
                                        For the                            For the                   October 19,
                                  Three Months Ended                   Six Months Ended                 1995
                                        June 30,                           June 30,                 (Inception) to
                             ---------------------------------  ---------------------------------      June 30,
                                   2002              2001             2002              2001             2002
                             ---------------   ---------------  ----------------  ---------------  ----------------
                              (unaudited)       (unaudited)      (unaudited)       (unaudited)      (unaudited)
<S>                         <C>               <C>               <C>              <C>              <C>
Basic and diluted
   Loss per common
     share                   $         (0.02)  $          0.00  $          (0.07) $         (0.02)
                             ===============   ===============  ================  ===============

   Weighted-average
     common shares
     outstanding                   1,065,358         1,102,157         1,083,656        1,102,157
                             ===============   ===============  ================  ===============

</Table>

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

                                        4

<Page>



                                                      ORION ACQUISITION CORP. II
                                                   (A DEVELOPMENT STAGE COMPANY)
                                                        STATEMENTS OF CASH FLOWS
                 For the Six Months Ended June 30, 2002 and 2001 (unaudited) and
   for the Period from October 19, 1995 (Inception) to June 30, 2002 (unaudited)

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

<Table>
<Caption>


                                                                                                       For the
                                                                                                     Period from
                                                                                                     October 19,
                                                                    For the Six Months Ended            1995
                                                                            June 30,                (Inception) to
                                                                --------------------------------       June 30,
                                                                      2002              2001             2002
                                                                ----------------  ---------------  ----------------
                                                                 (unaudited)       (unaudited)      (unaudited)
<S>                                                             <C>              <C>             <C>

Cash flows from operating activities
   Net income (loss)                                            $        (76,586) $       (27,321) $        105,835
   Adjustments to reconcile net income (loss) to net
     cash provided by (used in) operating activities
       Note discount amortization                                              -                -            37,500
       Stock-based compensation expense                                        -                -           100,000
       Increase in
         Income taxes receivable                                               -                -           (26,694)
         Deferred income taxes                                                 -                -              (221)
         Other assets                                                          -                -           (15,780)
       Increase (decrease) in
         Accrued expenses                                                 (8,563)         (16,916)           25,333
                                                                ----------------  ---------------  ----------------

Net cash provided by (used in) operating activities                      (85,149)         (44,237)          225,973
                                                                ----------------  ---------------  ----------------

Cash flows from investing activities
   Purchase of United States Treasury bills                                    -                -        (1,506,615)
   Sales or maturities of investments                                          -          (38,536)          (84,029)
                                                                ----------------  ---------------  ----------------

Net cash used in investing activities                                          -          (38,536)       (1,590,644)
                                                                ----------------  ---------------  ----------------

Cash flows from financing activities
   Dividend                                                                    -                -        (7,200,000)
   Issuance of units and redeemable Class B
     purchase warrants, net of offering costs                                  -                -         8,677,905
   Issuance of unsecured promissory notes                                      -                -           100,000
   Repayment of unsecured promissory notes                                     -                -          (100,000)
   Proceeds from related party note                                            -                -            35,000
   Repayment of related party note                                             -                -           (35,000)
   Issuance of founders' shares                                                -                -             7,500
   Issuance of private placement shares                                        -                -           304,520
   Issuance of convertible preferred stock                                     -                -            11,000
                                                                ----------------  ---------------  ----------------

Net cash provided by financing activities                                      -                -         1,800,925
                                                                ----------------  ---------------  ----------------

</Table>

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

                                        5

<Page>


                                                      ORION ACQUISITION CORP. II
                                                   (A DEVELOPMENT STAGE COMPANY)
                                                        STATEMENTS OF CASH FLOWS
                 For the Six Months Ended June 30, 2002 and 2001 (unaudited) and
   for the Period from October 19, 1995 (Inception) to June 30, 2002 (unaudited)

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

<Table>
<Caption>


                                                                                                       For the
                                                                                                     Period from
                                                                                                     October 19,
                                                                    For the Six Months Ended            1995
                                                                            June 30,                (Inception) to
                                                                --------------------------------       June 30,
                                                                      2002              2001             2002
                                                                ----------------  ---------------  ----------------
                                                                 (unaudited)       (unaudited)      (unaudited)
<S>                                                             <C>              <C>             <C>

Net increase (decrease) in cash                                 $        (85,149) $       (82,773) $        436,254

Cash, beginning of period                                              2,112,047          585,480                 -
                                                                ----------------  ---------------  ----------------

Cash, end of period                                             $      2,026,898  $       502,707  $        436,254
                                                                ================  ===============  ================


Supplemental disclosures of cash flow
information

   Income taxes paid                                            $              -  $             -  $         61,000
                                                                ================  ===============  ================

</Table>

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

                                      6

<Page>


                                                      ORION ACQUISITION CORP. II
                                                   (A DEVELOPMENT STAGE COMPANY)
                                                   NOTES TO FINANCIAL STATEMENTS
                                                       June 30, 2002 (unaudited)

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

NOTE 1 - ORGANIZATION AND LINE OF BUSINESS

         Orion Acquisition Corp II (the "Company") was incorporated in Delaware
         on October 19, 1995 for the purpose of raising capital to fund the
         acquisition of an unspecified operating business. All activity to date
         relates to the Company's formation and fundraising. To date, the
         Company, as a development stage company, has not effected a Business
         Combination (as defined below).

         The Company's management has broad discretion with respect to the
         specified application of the assets of the Company, although
         substantially all of the assets are currently intended to be generally
         applied toward consummating a business combination with an operating
         business ("Business Combination").


NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

         Basis of Presentation
         The accompanying financial statements have been prepared in conformity
         with accounting principles generally accepted in the United States of
         America for interim financial information and with the instructions to
         Form 10-QSB and Regulation S-B. Accordingly, they do not include all of
         the information and footnotes required by accounting principles
         generally accepted in the United States of America for complete
         financial statements. In the opinion of management, all normal,
         recurring adjustments considered necessary for a fair presentation have
         been included. The financial statements should be read in conjunction
         with the audited financial statements included in the Company's annual
         report on Form 10-KSB for the year ended December 31, 2001. The results
         of operations for the six months ended June 30, 2002 are not
         necessarily indicative of the results that may be expected for the year
         ended December 31, 2002.

         Development Stage Enterprise
         The Company is a development stage company as defined in Statement of
         Financial Accounting Standards ("SFAS") No. 7, "Accounting and
         Reporting by Development Stage Enterprises." The Company is devoting
         all of its present efforts to its formation and to fundraising, and its
         planned principal operations have not yet commenced. All losses
         accumulated since inception have been considered as part of the
         Company's development stage activities.

                                        7
<Page>

                                                      ORION ACQUISITION CORP. II
                                                   (A DEVELOPMENT STAGE COMPANY)
                                                   NOTES TO FINANCIAL STATEMENTS
                                                       June 30, 2002 (unaudited)

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

NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)

         Loss per Share
         The Company calculates loss per share in accordance with SFAS No. 128,
         "Earnings per Share." Basic loss per share is computed by dividing the
         loss available to common stockholders by the weighted-average number of
         common shares outstanding. Diluted loss per share is computed similar
         to basic loss per share except that the denominator is increased to
         include the number of additional common shares that would have been
         outstanding if the potential common shares had been issued and if the
         additional common shares were dilutive.

         Because the Company has incurred net losses, basic and diluted loss per
         share are the same. The following potential common shares have been
         excluded from the computation of diluted net loss per share for all
         periods presented because they are not exercisable until after a
         Business Combination:

<Table>
<Caption>

                                                                                     For the Six Months Ended
                                                                                             June 30,
                                                                                -----------------------------------
                                                                                      2002               2001
                                                                                ---------------    ----------------
                                                                                 (unaudited)        (unaudited)
                 <S>                                                            <C>                  <C>

                  Class A Warrants                                                            -             880,000
                  Class B Warrants                                                      358,100             390,100
                  Series A Convertible Preferred Stock                                  110,000             110,000
                  Stock option                                                           10,000              10,000
                  Option to purchase Class A Warrants                                         -             100,000

</Table>

         Estimates
         The preparation of financial statements requires management to make
         estimates and assumptions that affect the reported amounts of assets
         and liabilities and disclosure of contingent assets and liabilities at
         the date of the financial statements and the reported amounts of
         revenue and expenses during the reporting period. Actual results could
         differ from those estimates.

                                        8

<Page>

                                                      ORION ACQUISITION CORP. II
                                                   (A DEVELOPMENT STAGE COMPANY)
                                                   NOTES TO FINANCIAL STATEMENTS
                                                       June 30, 2002 (unaudited)

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

NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)

         Recently Issued Accounting Pronouncement
         In June 2002, the FASB issued SFAS No. 146, "Accounting for Costs
         Associated with Exit or Disposal Activities." This statement addresses
         financial accounting and reporting for costs associated with exit or
         disposal activities and nullifies Emerging Issues Task Force ("EITF")
         Issue No. 94-3, "Liability Recognition for Certain Employee Termination
         Benefits and Other Costs to Exit an Activity (including Certain Costs
         Incurred in a Restructuring)." This statement requires that a liability
         for a cost associated with an exit or disposal activity be recognized
         when the liability is incurred. Under EITF Issue 94-3, a liability for
         an exit cost, as defined, was recognized at the date of an entity's
         commitment to an exit plan. The provisions of this statement are
         effective for exit or disposal activities that are initiated after
         December 31, 2002 with earlier application encouraged. The Company does
         not expect adoption of SFAS No. 146 to have a material impact, if any,
         on its financial position or results of operations.


NOTE 3 - CONTINGENCIES

         Litigation
         On July 1, 1999, a Class B Warrant-holder of the Company brought suit
         against the Company, its former directors, and certain other third
         parties. On January 31, 2000, the plaintiff filed a notice dismissing
         the action without prejudice. On January 28, 2000, the court ordered
         the notice of dismissal. The Company and the plaintiff agreed that the
         Company will make an exchange offer to all holders of the Class B
         Warrants.

         The exchange offer must be made after the Company completes its first
         Business Combination with a target company that results in the
         acquisition of one or more companies with operating businesses and
         results in the Company having assets in excess of $5,000,000.

         Upon payment of an exercise price of $0.125 per Class B Warrant, each
         Class B Warrant will be exchanged for one share of common stock and one
         Right. The Right will provide for the issuance of additional shares of
         common stock based on a formula in the event that (a) the Company makes
         an acquisition or consummates a merger and (b) the post-transaction
         company does not meet the specified targets of a $7,000,000 net worth
         immediately after the transaction and a minimum common stock price of
         $5.75 for 10 days during the two-year period following the transaction,
         subject to certain adjustment, terms, and conditions.

                                        9

<Page>

                                                      ORION ACQUISITION CORP. II
                                                   (A DEVELOPMENT STAGE COMPANY)
                                                   NOTES TO FINANCIAL STATEMENTS
                                                       June 30, 2002 (unaudited)

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

NOTE 3 - CONTINGENCIES (Continued)

         Litigation (Continued)
         The former directors of the Company who were named as defendants in the
         suit have made demand upon the Company for reimbursement of attorneys'
         fees incurred in defense of the suit prior to its voluntary dismissal.
         The former directors contend that they are entitled to reimbursement of
         attorneys' fees under a provision of Delaware corporate law. The
         Company is considering the reimbursement request. No accrual has been
         made for any potential reimbursement in the accompanying financial
         statements.

         On October 31, 2000, the Company filed with the Supreme Court of the
         State of New York, County of New York, a summons and complaint in an
         action entitled Orion Acquisition Corp. II v. Mentmore Holdings
         Corporation, Mentmore Holdings, Inc., Richard L. Kramer, William L.
         Remley, Richard C. Hoffman, Robert D. Frankel, J. Thomas Chess, and
         Michael Schenker. Messrs. Kramer, Remley, Hoffman, Frankel, and Chess
         are former directors of the Company. Messrs. Remley and Kramer were
         officers and/or directors of one or more of the Mentmore defendants.
         Mr. Hoffman is or was an officer of one or more of the Mentmore
         defendants.

         In the complaint, the Company alleged a series of causes of action,
         including a claim against the Company's former directors for breach of
         fiduciary duty in connection with the diversion of a corporate
         opportunity, and against other defendants for aiding and abetting the
         claimed breach of fiduciary duty and duty of loyalty. On March 28,
         2002, a settlement agreement was reached between the Company and the
         Mentmore defendants, which was executed and approved by the court on
         May 15, 2002. Under the settlement certain of the defendants
         surrendered 71,250 shares of the Company's common stock that were owned
         by those defendants which the Company cancelled and certain of the
         defendants surrendered a warrant to purchase 100,000 shares of the
         Company's common stock which the Company cancelled, and the former
         directors withdrew their claims for reimbursement by the Company of
         their defense costs.


NOTE 4 - RELATED PARTY TRANSACTIONS

         The Company uses the services and some of the employees of an
         affiliated company and has its executive offices at the offices of the
         affiliate. The Company does not pay any amount to or for the employees
         of the affiliate or any rent for these offices. The Company reimburses
         the affiliate for documented out-of-pocket expenses incurred on its
         behalf.

                                       10

<Page>

         ITEM 2 - MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION

         Results for the six-month period ending June 30, 2002, consisted of
         investment income earned from Treasury bills less expenses associated
         with general and administrative overheads and litigation expenses.
         Income for the six months ended 2002 was less than the comparable
         quarters for the prior year because of a fall in interest rates on the
         types of treasury securities in which the Company invests its cash
         balances. This is expected to continue. Results for the six months
         ended June 30, 2001 consisted of investment income earned from Treasury
         bills less expenses associated with general and administrative
         overheads.

         The Company continues to search for a suitable company to complete a
         business combination or merger. There remainds adequate cash on hand to
         bear the costs of due diligence or legal fees necessary to locate and
         evaluate potential candidates for a business combination. If a
         candidate is found the Company may need to raise additional funds to
         complete the acquisition.


                           PART II. OTHER INFORMATION

         ITEM 1: Legal Proceedings

         On July 1, 1999, a Class B Warrantholder of Orion brought an action
         ("July Action") against Orion, its former directors and certain others.
         On January 31, 2000, the plaintiff filed a notice dismissing the July
         Action without prejudice. On January 28, 2000 the court ordered the
         notice of dismissal. The Company and the plaintiff agreed that Orion
         will make an exchange offer to all holders of the Class B Warrants. The
         exchange offer must be made after Orion completes its first business
         combination of a target company that results in the acquisition of one
         or more companies with operating businesses and results in Orion having
         assets in excess of $5,000,000. The terms of the exchange offer will
         require each holder to pay the $.125 exercise price of the Class B
         Warrant and surrender the warrant for one share of common stock, one
         Class A Warrant and one Right. The Right will provide for the issuance
         of additional shares of common stock based on a formula in the event
         that Orion makes an acquisition or consummates a merger and the post
         transaction company does not meet the specified targets of a $7,000,000
         net worth immediately after the transaction and a minimum common stock
         price of $5.75 for ten days during the two year peiod following the
         transaction, subject to certain adjustment, terms and conditions.

         On October 31, 2000, Orion filed with the Supreme Court of the State of
         New York, County of New York, a summons and complaint in an action
         entitled Orion Acquisition Corp. II v. Mentmore Holdings Corporation,
         Mentmore Holdings, Inc., Richard L. Kramer, William L. Remley, Richard
         C. Hoffman, Robert D. Frankel, J. Thomas Chase, and Michael D.
         Schenker. Messrs. Karmer, Remley, Hoffman, Frankel and Chess are former
         directors and/or officers of Orion. Messrs. Remley and Kramer are or
         were officers and/or directors of one or more of the Mentmore
         defendants. Mr. Hoffman is or was an officer of one or more of the
         Mentmore defendants. In the complaint, Orion alleged a series of causes
         of action, including a claim against the former Orion directors for
         breach of fiduciary duty in connection with the diversion of a
         corporate opportunity, and against other defendants for aiding and
         abetting the claimed breach of fiduciary duty and duty of loyalty.

         On March 28, 2002, the terms of a settlement were reached between the
         Company and the Mentmore defendents and was signed on May 15, 2002.
         Under the settlement certain of the defendents surrendered 71,250
         shares of Orion's common stock which were owned by those defendents
         which the Company cancelled, certain of the defendents surrendered a
         warrant to purchase 100,000 shares of the Company's stock which the
         Company cancelled, and the former directors withdrew their claim for
         reimbursement by the Company of their defense costs.

                                       11

<Page>

         ITEM 2: Changes in Securities

         None

         ITEM 3: Defaults Upon Senior Securities

         None

         ITEM 4: Submission of Matters to a Vote of Security Holders

         None

         ITEM 5: Other Information

         None

         ITEM 6: Exhibits and Reports on Form 8-K

         (a) Exhibits:

                99.1 Certification by Christopher A. Marlett
                99.2 Certification by Anthony DiGiandomenico

         (b) Reports on Form 8-K:

         None



                                       12

<Page>

                                   SIGNATURES

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


        August 19, 2002
                                         ORION ACQUISITION CORP. II


                                         By: /s/ Christopher A. Marlett
                                             ----------------------------
                                             Christopher A. Marlett
                                             Chairman, President, and CEO



                                         By: /s/ Anthony DiGiandomenico
                                             ----------------------------
                                             Anthony DiGiandomenico
                                             Chief Financial Officer


                                       13