U. S. SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549

                                   FORM 10-KSB

(Mark One)

|X| ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE ACT
OF 1934 (FEE REQUIRED)

FOR THE FISCAL YEAR ENDED APRIL 30, 1997

|_| TRANSITION  REPORT UNDER SECTION 13 OR 15(D) OF THE SECURITIES  EXCHANGE ACT
OF 1934 ( NO FEE REQUIRED)

     For the transition period from __________________ to _________________

Commission File No. 0-4006

                      ORION DIVERSIFIED TECHNOLOGIES, INC.
                 ( Name of Small Business Issuer in its charter)

           New Jersey                                          22-1637978
(State or other jurisdiction of                             (I.R.S. Employer
incorporation  or organization)                          Identification Number)

80 Raynor Avenue, Ronkonkoma New York                             11779
(Address of Principal Executive Offices)                       (Zip Code)

                                 (516) 467-2301
                 (Issuer's Telephone Number Including Area Code)

        Securities registered pursuant to Section 12(b) of the Act: None

           Securities registered pursuant to Section 12(g) of the Act:

                          Common Stock, $.01 par value
                          ----------------------------
                                (Title of Class)

     Check whether the Issuer (1) has 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 registration was required to file such reports), and (2)
has been subject to such filing requirements for the past 90 days.

                           YES __X__       NO ______



<PAGE>



Check if there is no disclosure of delinquent  filers in response to Item 405 of
Regulation S-B not contained in this form, and no disclosure  will be contained,
to the best of the  registrant's  knowledge,  in definitive proxy or information
statements  incorporated  by  reference  in Part III of this Form  10-KSB or any
amendment to this Form 10-KSB. |_|

     State issuer's revenues for its most recent fiscal year. $0

State the  aggregate  market  value of the voting  stock held by  non-affiliates
computed by reference  to the price at which the stock was sold,  or the average
bid and asked  prices of such stock,  as of a specified  date within the past 60
days. $368,888.00.

                   ISSUERS INVOLVED IN BANKRUPTCY PROCEEDINGS
                           DURING THE PAST FIVE YEARS

     Check whether the issuer has filed all documents and reports required to be
 filed by Section 12,13 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 REGISTRANTS

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

                 Common Stock, $.01 Par Value, 1,844,397 shares


                       DOCUMENTS INCORPORATED BY REFERENCE

                                      None




<PAGE>



                                     PART I

ITEM 1. BUSINESS

(a) Business Development

     Historical

The  Registrant  was  incorporated  in New  Jersey  in  1959.  Until  1986,  the
Registrant  was  engaged in the  marketing  and sale of a line of  approximately
2,500 electronic semiconductors,  principally transistors, diodes and rectifiers
and, to a lesser extent,  other ancillary related electronic  products priced at
between $4.00 to $15.00 per item,  with a majority of the items selling for less
than $5.00.

     White Plains Co-op and Attempted Acquisition

During the three years and approximately nine months ended January 11, 1996, and
as  previously  reported in the  Registrants  periodic  reports  filed under the
Securities  Exchange  Act  of  1934  (the  "34  Act"),  the  development  of the
Registrant's  business was limited to: (i) the  acquisition on February 25, 1993
from Michaels Associates,  a non-affiliated  business entity, of a 85.81% equity
interest in Netherland Gardens Owners, Inc., a New York corporation ("NGO") that
is the record and beneficial  owner of a 59 unit co-op  residential  dwelling in
White Plains,  New York (the "Co-op");  (ii) the execution on February 28, 1994,
of an  Agreement  and  Plan of  Reorganization  (the  "AFT  Agreement")  with AF
Technology,  Inc., a non-affiliated New York corporation ("AFT"); (iii) bringing
itself current in its periodic reporting  obligations under the 34 Act; (iv) the
execution of a March 4, 1994 written co-venture agreement (the "Semi Agreement")
with New Jersey Semi-  Conductor  Products,  Inc., a  non-affiliated  New Jersey
corporation ("Semi"); (v) the January 11, 1996 divestiture of NGO and the Co-op;
and (vi)  investigating  the  opportunities  for a business  combination  with a
profitable privately owned entity.

     The C0-op

The Co-op was acquired by the  Registrant  on February 25, 1993  pursuant to the
terms and  conditions  of a  written  agreement  with  Michaels  (the  "Michaels
Agreement").  Neither  Sackler nor Namit were  affiliated with the Registrant in
1993. The sole  consideration for the 1993 acquisition was the original issuance
of an aggregate of 550,000 unregistered shares of the Registrant's Common Stock,
$.01 par  value  per share  (the  "Shares"),  500,000  of which  were  issued to
Michaels  and the balance to Namit as a finder's  fee.  Pursuant to the Michaels
Agreement,  Michaels was  obligated to deliver the NGO Shares to the  Registrant
free and clear of any and all liens, claims or encumbrances. Notwithstanding the
intent of the parties, and due to the fact that in 1993 Michaels had pledged the
NGO Shares to a commercial bank as collateral security for a $390,000 obligation
of Michaels to that bank,  Michaels  was never able to make  delivery of the NGO
Shares  to the  Registrant.  Consequently,  the  Shares  were  held  by  ORDT as
collateral  security  for  Michaels  obligation  to deliver the NGO Shares.  The
economic  basis and business


<PAGE>


purpose  for the  Registrant's  acquisition  of the Co-op was  disclosed  in the
Registrant's  Form 8-K Current  Report  dated July 12,  1993.  The  Registrant's
divestiture  of the  Co-op  was  accomplished  by means of the  recision  of the
Michaels Agreement.

Pursuant to the Agreement,  the Registrant  released Michaels and Namit from any
and all liability and responsibility to deliver the NGO Shares to the Registrant
and transferred all of the  Registrant's  right,  title and interest  therein to
Michaels.  In exchange  for the  Registrant's  release of Michaels  and Namit as
aforesaid, Michaels and Namit jointly and severally released the Registrant from
any and all  obligation  and  responsibility  to deliver an aggregate of 450,000
Shares to Michaels as provided in the Michaels  Agreement  and  transferred  and
hypothecated  the Michaels  Shares and any and all of Michaels'  and/or  Namit's
right,  title and interest  therein to  Registrant.  Finally,  and by means of a
non-interest  bearing,  60 day promissory note issued by Mr. Joseph Petito,  the
Registrant's  President,  in his individual capacity,  the Registrant reimbursed
Sackler for the $17,750 in expenses  he  incurred in  connection  with  Michaels
transaction with the Registrant.

                           A.F.T. Technologies ("AFT")

     Since February 28, 1994 through and including the date of this report,  the
Registrant has not closed on the business combination with AFT enumerated in the
AFT Agreement.  As of November  1994,  the last time the Registrant  took action
with respect  thereto,  the Registrant's  Board of Directors,  at the request of
Joseph  Petito,  delegated  to Mr.  Petito  the  decision  whether  to  commence
litigation against AFT and its principal  executive officer and owner for breach
of the AFT Agreement.  At a meeting of the Board of Directors of Orion,  held on
October 1, 1996,  Petito  recommended to the Board that the AFT Agreement should
be abandoned because  litigation to enforce the Agreement would be too expensive
and the situtation  concerning AFT has radically  changed and it would no longer
be prudent to pursue the matter. The Board adopted Petitio's  recommendation and
it was resolved that the pursuit of the AFT Agreement be abandoned.

     Co-op Divestiture

On  January  11,  1996 and  pursuant  to the terms and  conditions  of a written
agreement of even date therewith (the "Agreement")  among the Registrant,  Harry
Sackler ("Sackler") in his capacity as President of NS Equities Corporation, the
corporate General Partner of Michaels Associates, a New York Limited Partnership
("Michaels"),  and Nick  Namit,  a Director  of the  registrant  ("Namit"),  the
Registrant   divested  itself  of  its  85.81%  equity  ownership  of  NGO.  The
Registrant's  equity ownership in NGO was represented by stock certificates (the
"NGO Shares").  Sackler was a Director and an affiliate of the  Registrant.  The
Co-op  represented  all but  approximately  $104,000 of the  Registrant's  total
assets, and all but approximately $133,000 of the Registrant's total liabilities
as reported in its Form 10-Q  Quarterly  report for the three  months ended July
31, 1995. With respect to the 100,000 Shares retained by Michaels and Namit, the
Agreement  provided  that the resale  thereof  was  limited to 5,000  Shares per
month.

The  Registrant  had  two  principal   business  purposes  in  implementing  the
Agreement.  The first was to free the Registrant from any and all responsibility
(principally  the  underlying  bank


<PAGE>


obligation and the ongoing real estate and other tax obligations) attendant upon
Michael's  failure to deliver the NGO Shares to the Registrant free and clear of
any and all liens,  claims or  encumbrances,  by  returning  the  parties to the
position  they  were in prior to the  execution  and  delivery  of the  Michaels
Agreement.  The second was to free the Registrant's balance sheet of liabilities
with a view  towards  fulfilling  the  stated  intent  of  its  1990  bankruptcy
proceeding  by the  consummation  of a business  combination  with a  profitable
privately owned entity.

(b) Business of the Registrant

Until January 11, 1996,  the  Registrant's  business was confined to the passive
ownership  of its equity  interest in NGO and the receipt of rental  income from
the Co-op,  the passive  receipt of income from Semi's sale of the  Registrant's
inventory of semi-conductor  parts (the "Inventory") and the active pursuit of a
business combination partner.  Since January 11, 1996, the Registrant's business
has been confined to the active pursuit of a business  combination  partner.  In
pursuit of its business,  and during the fiscal year ended April 30, 1996,  none
of the information  required to be disclosed and enumerated in paragraphs (b)(1)
through  (b)(11) of Item 101 of Regulation  S-B was applicable to the Registrant
or its business.

Notwithstanding  the  foregoing,  the  Registrant  has been advised by Semi that
pursuant to the Semi  Agreement,  Semi caused the  Registrant's  Inventory to be
parameter tested by computer; cleaned; identification branded with code numbers;
dated; baked and packaged.  Semi is presently offering the same for sale through
its distribution system of independent sales  representatives to a wide range of
original  equipment  manufacturers  located  throughout  the  United  States and
overseas.  Pursuant to the Semi  Agreement,  the Registrant is to receive 50% of
any and all sales of the Inventory by Semi.  As of the date of this Report,  the
Registrant  has  only  received  a  $5,000  advance  from  Semi  under  the Semi
Agreement.  No income was received  from Semi during the fiscal year ended April
30, 1997.

Based upon its prior experience with the semi-conductor industry, the Registrant
believes  that  while  price is the  principal  method of  competition,  product
performance,   reliability   and   ease   of  use  are   important   competitive
considerations  and may be deemed to be ancillary  methods of competition in the
semiconductor  industry.  The Registrant  believes that Semi attempts to compete
primarily by means of offering a more varied inventory of semiconductor products
and maintaining a capability to ship relatively  small quantities of products on
short notice, methods which would be uneconomical for its large competitors.

The Registrant  believes that the Inventory  marketed and sold by Semi continues
to be utilized to a limited  extent in a variety of  industrial,  commercial and
consumer goods,  including the electronic systems in automobile,  minicomputers,
microcomputers,  television sets and radios. A transistor is a device with three
or more  electrodes  capable of amplifying  power.  A diode is a device with two
electrodes capable of regulating voltage allowing current to flow chiefly in one
direction.  A rectifier is a device  capable of converting  alternating  current
into direct current.


<PAGE>



The Registrant does not employ any full time employees.  Mr. Joseph Petito,  the
Registrant's  President and Chief Executive and Financial Officer,  continues to
devote such  percentage  of his full time and  attention  to the business of the
Registrant as is required.

(c) The Registrant's Common Stock Purchase Warrants

As part of the Registrant's  Plan of  Reorganization  as confirmed by the United
States  Bankruptcy  Court for the Eastern District of New York on April 30, 1990
and  consummated  on June 2, 1992 (the  "Plan"),  the  Registrant  has issued an
aggregate of 903,762  Series A Common  Stock  Purchase  Warrants  (the "Series A
Warrants") and an aggregate of 905,262  Series B Common Stock Purchase  Warrants
(the "Series B Warrants").  The Series A Warrants were  exercisable at $2.50 per
share within  fifteen (15) months from June 2, 1992,  the payment date under the
Plan,  or such  further  extension  as the  Registrant  may grant.  The Series B
Warrants were  exercisable at $3.50 per share within thirty (30) months from the
payment date under the Plan,  or such further  extension as the  Registrant  may
grant.

On September 19, 1990, and as required by the Plan, the Registrant  prepared and
forwarded to all  stockholders of record,  a notice advising  stockholders as to
the applicable terms of the Plan (the "Notice"); the operative provisions of the
Notice were as follows:

     1. All theretofore issued and outstanding shares of the Registrant's Common
Stock, $.01 par value per share, which were restricted  securities were canceled
and would not be reissued;

     2. All non-legend stock  (free-trading)  was also canceled but was reissued
at a reverse-split ratio of three new shares for every seven "old" shares turned
in. Each "new" share was  accompanied by two Common Stock Purchase  Warrants;  a
Class A Warrant  exercisable  within  fifteen months and entitling the holder to
purchase one additional "new" share of the  Registrant's  Common Stock at $2.50;
and a Class B Warrant exercisable at any time within thirty months and entitling
the holder to purchase one  additional  "new" share of the  Registrant's  Common
Stock at $3.50 a share. A unit consists of one Common Stock  certificate and two
Warrant certificates. Stockholders will be required to pay a transfer fee to the
transfer agent.

The  condition  of the  above-mentioned  re-issuance  was that all shares in the
stockholders'  possession,  or in possession  of the  shareholder's  broker,  be
returned to the Registrant's  then transfer agent,  Liberty Transfer Co., by the
cut-off  date which was set at November  15, 1990,  5:00 p.m.  Eastern  Standard
Time.  Failure to comply with this provision would result in the cancellation of
any shares theretofore owned by stockholders.

On November 12, 1990, the Registrant  prepared and forwarded to all stockholders
of  record a notice  advising  the  stockholders  that  the  expiration  date to
surrender and exchange their Common Stock certificates had been extended to 5:00
p.m. on Monday,  December 31, 1990. On January 20, 1992,  due to the  bankruptcy
proceedings and the Registrant's slow restart-up the Board of Directors extended
the Class A warrants six months to June 30, 1993.


<PAGE>


The  jurisdiction  of the  Bankruptcy  Court over the affairs of the  Registrant
ended  on  June  2,  1992  when  the  Bankruptcy  Court  entered  the  order  of
consummation.  Due principally to the longer than anticipated  commencement date
of  operations  and with a view  towards  granting to  stockholders  the benefit
intended in the Plan,  management  determined that the six months  extension for
the warrants  would be inadequate.  Accordingly,  on April 21, 1993 the Board of
Directors extended the warrants to December 31, 1994. For the same reasons,  and
on July 8, 1994, the Board of Directors voted to extend both classes of warrants
until the close of business on December  31,  1995.  A notice to this effect was
mailed to the  Registrant's  stockholders.  Further,  on October 15, 1995,  at a
meeting  of the Board,  at which a  majority  was  present,  it was  unanimously
resolved  that both the A and B Warrants be extended to the close of business on
December  31, 1997,  and a notice was sent to all  shareholders  and  interested
stockbrokers.

ITEM 2. DESCRIPTION OF PROPERTY

(a)(1)  Rental  Premises.  From May 1, 1991  through June 1995,  the  Registrant
maintained its executive  offices at 659 Old Willets Path,  Hauppauge,  New York
11788, where  approximately  5,000 square feet of space was subleased from Adaer
Berkeley Colleton Inc., an affiliated landlord, at $1895.00 per month on a month
to month basis without the benefit of a written  sublease.  In addition to rent,
the Registrant was responsible for its proportionate  share of increases in real
estate taxes.  During the fiscal year ended April 30, 1995,  the  Registrant did
not pay any real  estate  taxes  to  Adaer  Berkeley  Colleton  Inc.  a New York
corporation  controlled  by  or  under  common  control  of  Joseph  Petito  the
Registrant's President. In the opinion of management, the registrant's Hauppauge
facility  was  adequate  for the  Registrant's  needs and was being  utilized to
approximately 85% of its capacity.  During the fiscal year ended April 30, 1995,
and due principally to the Registrant's  lack of operating  income,  100% of the
Registrant's  rent and operating  expenses at its Hauppauge  office were assumed
and paid by Joseph Petito.  Notwithstanding  the  Registrant's  inability to pay
rent,  and in the opinion of the  Registrant's  Board of  Directors,  the rental
charged to the  Registrant  by Adaer  Berkeley  Colleton  Inc. was less than the
rental the Registrant  could have obtained at arms length from a  non-affiliated
landlord.  The property,  659 Old Willets Path,  Hauppauge,  L.I.,  New York, is
owned and operated by VIP Associates,  an entity  non-affiliated with either the
Registrant or Joseph Petito.

In June 1995,  the  Hauppauge  facility was  partially  destroyed by fire.  As a
result thereof,  the Registrant moved its executive offices to 80 Raynor Avenue,
Ronkonkoma,  New York  11779,  where  approximately  500 square feet of space is
sublet from Joseph Petito, an affiliated landlord, rent free on a month to month
basis without the benefit of a written sublease. The sublet offices are suitable
for the  Registrant's  present  needs  and are being  utilized  to 100% of their
capacity.  The  Registrant  also has the  benefit of the use of  telephones  and
office equipment provided by Mr. Petito without charge.

(a)(2)  Inventory . Pursuant to the terms of the Semi Agreement,  the Registrant
has a fifty percent income interest in the Inventory.  Management  believes that
this  inventory  should be  abandoned  because  the cost of  running  an audited
inventory year after year is a greater  expense than the value of the inventory,
and Management will propose that the inventory be abandoned as being  worthless,
at the next Board Meeting.


<PAGE>


(b). Investment Policies. Although the Registrant owned the NGO Shares as one of
its principal  assets for a portion of the fiscal year ended April 30, 1996, the
Registrant  was not engaged in the business of  investing  in real estate,  real
estate Mortgages,  real estate trusts or partnerships or real estate securities.
Accordingly,  and except for the desire to  preserve  the Co-op and to  generate
income from its  ownership of the NGO Shares,  the  Registrant  did not have any
established  policy with respect to real estate.  In the opinion of  management,
the disclosure  required by subparagraphs  (1) through (3) of this paragraph (b)
are inapplicable to the Registrant.

(c) Description of Real Estate and Operating Data.

     (1) The only property held by the  Registrant  during the fiscal year ended
April  30,  1996  was the NGO  Shares.  NGO  owns the  Co-op  consisting  of two
buildings  having 59 units for sale and 1  management  service  unit  located in
White Plains, New York.

     (2) The NGO Shares were  encumbered by the Mortgages and a lien of $390,000
which lien must be paid off by Michael  Associates  the seller.  As of April 30,
1995,  the principal  balance of the Mortgages  was  $3,180,060  (comprised of a
$1,405,060  first and a $1,775,000 wrap around) the monthly  payments  aggregate
$9,897.91  and the  Mortgages  mature  on 2010.  In  light  of the  Registrant's
divestiture  of the Co-op and NGO, the  principal  balance of the  Mortgages and
their monthly  payments is not relevant to the Registrant  and this  information
was not obtained.

     (3) Securities of or Interests in Persons  Primarily Engaged in Real Estate
Activities. Inapplicable.

     (4) In light of the  Registrant's  divestiture  of the Co-op  and NGO,  the
information  called for herein is inapplicable.  However,  and during the period
which the Registrant owned the Co-op, the Registrant had no intention of nor did
it cause any  improvements  to the  Co-op  other  than  ordinary  and  necessary
maintenance and repairs.

     (5) The  co-op  real  estate  market  in  White  Plains,  New  York is very
competitive with an abundance of available units at competitive prices.

     (6) In  the  opinion  of  management,  and  during  the  period  which  the
Registrant  owned the Co-op,  the Co-op was adequately  covered by liability and
other insurance.

     (7) With respect to the Co-op,  and during the period which the  Registrant
owned the Co-op:  (i) the occupancy rate was 17% with 10 units sold and 49 units
remaining   unsold   including  the  one  unit  occupied  by  the  super;   (ii)
inapplicable;  (iii) none;  (iv) the average  selling price for each of the sold
units was $48,000 and the average  selling price of the unsold units is $45,000;
(v) the  Co-op  was  comprised  of  rental  units;  (vi) (A)  inapplicable;  (B)
inapplicable; (C) the method was straight line depreciation; and (D) the life of
the CO-op for  depreciation  purposes was 27 1/2 years; and (vii) and the annual
real estate taxes for the past year were $ 61,561.


<PAGE>



ITEM 3. LEGAL PROCEEDINGS

Since  the  consummation  of the  Plan of  Reorganization  on June 2,  1992,  no
material legal  proceeding  was pending or threatened  against or settled by the
Registrant.

ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

Neither during the fourth quarter of the fiscal year ended April 30, 1997 nor at
any time since August 15, 1994 did the  Registrant  conduct an Annual Meeting of
its  stockholders  pursuant to definitive  proxy materials under Regulation 14 A
under the Act or otherwise.

                                     PART II

ITEM 5. MARKET FOR COMMON STOCK EQUITY AND RELATED STOCKHOLDER MATTERS.

(a) Market Information.

The principal market for the Registrant's Common Stock, its only class of equity
securities, is the over-the-counter market.

The following  table  indicates  the quarterly  high and low price ranges of the
Registrant's  Common stock  representing  actual trades in the over- the-counter
market  during the fiscal  years  ended April 30,  1996 and April 30,  1997,  as
reported by the Trading and Market Service of the Nasdaq Stock Market, Inc.

                                                          HIGH              LOW
                                                          ----              ---
                                                          
Fiscal 1996:
-----------

FIRST QUARTER
May 1st thru
July 31, 1995                                              2.75             1.00

SECOND QUARTER
August 1st thru
October 31, 1995                                           3.25              .50

THIRD QUARTER
November 1st thru
January 31, 1996                                           2.00             1.00


<PAGE>


FOURTH QUARTER
February 1st thru
April 30, 1996                                             3.00            1.625

Fiscal 1997:

FIRST QUARTER
May 1st thru
July 31, 1996                                              2.50              .75

SECOND QUARTER
August 1st thru
October 31, 1996                                           3.00              .50

THIRD QUARTER
November 1st thru
January 31, 1997                                           1.50              .50

FOURTH QUARTER
February 1st thru
April 30, 1997                                             1.25              .25

Fiscal 1998

FIRST QUARTER
May 1st thru
July 31, 1997                                               .75              .25

(b) Holders.

As of July 31, 1997,  the  approximate  number of holders of record of shares of
the Registrant's Common Stock,$.01 par value per share and Series A and Series B
Warrants,  the Registrant's  only class of trading  securities,  was believed by
management to be as follows:

         Title of Class                     Number of Record Holders
         --------------                     ------------------------

Common Stock, $.01 par                              325

Series  A Warrant                                   285

Series B Warrant                                    286

Management  believes  there are many  shareholders  and  warrant  holders  whose
securities  are held in street name with  various  brokerage  houses.  The exact
number are unknown to Registrant.


<PAGE>


(c) Dividends.

The  Registrant  has paid no  dividends  during the fiscal years ended April 30,
1996 and April 30, 1997.  Other than the requirements of the New Jersey Business
Corporation  Act that dividends be paid out of capital surplus only and that the
declaration and payment of a dividend not render the Registrant insolvent, there
are no  restrictions  on the  Registrant's  present  or  future  ability  to pay
dividends.

The payment by the  Registrant of dividends,  if any, in the future rests within
the  discretion of its Board of Directors  and will depend,  among other things,
upon the  Registrant's  earnings,  its capital  requirements  and its  financial
conditions, as well as other relevant factors.


ITEM 6. MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION

(a) Plan of Operation. Inapplicable.

(b) Management's  Discussion and Analysis of Financial  Condition and Results of
Operations.

(1)(A) Fiscal Year Ended April 30, 1997.  During the fiscal year ended April 30,
1997,  the  Registrant  had a net loss of  $150.00  on  $0.00 of gross  revenues
compared to a $70,260 net loss on $194,371 of gross revenues during the previous
fiscal year.  The  Registrant  attributes the reduction n its loss in the fiscal
year ended April 30, 1997,  to the fact that it did not have any gross  revenues
during the fiscal year ended April 30, 1997, and divestiture of NGO.

(1(B) Fiscal Year Ended April 30,  1996.  During the fiscal year ended April 30,
1996, the Registrant had a net loss of $70,260 on $194,371 of gross revenues. As
of the year ended April 30, 1997, current  liabilities were $266,327 compared to
the year ended April 30, 1996 of $266,177.  The increase was due to the increase
in accrued taxes and that due officer for reimbursement of expenses.

ITEM 7. FINANCIAL STATEMENTS

Financial statements meeting the requirements of Item 310 of regulation S-B, for
the fiscal year  ending  April 30, 1997 were  prepared by Meyer  Zimmerman.  The
Financial statements meeting the requirements of Item 310 of regulation S-B, for
the year  ending  April 30,  1996 were  prepared  by Meyer  Zimmerman.  Both are
annexed as a separate section to this Report.

ITEM  8.  CHANGES  IN AND  DISAGREEMENTS  WITH  ACCOUNTANTS  ON  ACCOUNTING  AND
FINANCIAL DISCLOSURE.

There have been no changes or disagreements.


<PAGE>



                                    PART III

ITEM 9. DIRECTORS, EXECUTIVE OFFICERS, PROMOTERS AND CONTROL PERSONS; COMPLIANCE
WITH SECTION 16(a) OF THE EXCHANGE ACT

(a) Identify Directors and Executive Officers.

The following table sets forth:  (1) names and ages of all persons who presently
are and who have been selected as directors of the Registrant; (2) all positions
and offices with the Registrant held by each such person; (3) the term or office
of each person named as a director; and 4) any period during which he or she has
served a such:

                  Duration and
                  Expiration           Position &             Age and
                  Date of              Office with            Director
Name              Present Term         Registrant             Since
----              ------------         ----------             -----

Joseph Petito     Next Annual          President,             77,March,1983
                   Meeting             Chief Executive
                                       Officer and Chief
                                       Financial Officer

Irwin Lampert     Next Annual          Vice President,        59,January,1995
                  Meeting              Secretary
                                       and Director (1)
------------

(1) Irwin Lampert was elected to the Registrant's  Board of Directors on January
2, 1995 upon the  resignation  Donald  Epstein,  to serve  until the next annual
meeting of the Board of  Directors.  On the same day,  Mr.  Lampert  was elected
Secretary of the Registrant, upon Mr. Epstein's resignation from that office.

There is no  understanding  or  arrangement  between any  directors or any other
person or persons  pursuant to which such individual was or is to be selected as
a director or nominee of the Registrant.

(4) Business Experience

The following is a brief account of the experience,  during the past five years,
of each director and executive officers of the Registrant:

JOSEPH PETITO, Mr. Petito has been continually  employed by the Registrant since
1986. From 1983 to 1986, Mr. Petito was the  Registrant's  Chairman of the Board
of  Directors  and since 1986 has served as its  President  and Chief  Executive
Officer.  Simultaneously  therewith,  Mr. Petito had been the  President,  and a
principal   shareholder  of  Aardvark   Sanitation  Co.,  Inc.,  an


<PAGE>


independent  industrial  waste removal hauler located in Islip,  New York, since
that  company's  inception in 1973.  Simultaneously,  and since its inception in
1979,  Mr.  Petito had served as  Secretary,  Treasurer,  Director and principal
shareholder of Island Salvage  Haulers,  Inc., an independent  industrial  waste
removal concern in Garden City, New York.  During the past ten years, Mr. Petito
has also  acted as an  independent  management  consultant  specializing  in the
design,  installation and operation of solid, liquid and hazardous waste removal
systems for commercial and  industrial  application.  During the past ten years,
Mr. Petito has also had other executive and directorial affiliations.

IRWIN LAMPERT,  since April 1995 has been a self employed electrical engineering
and defense  contracting  consultant in Brooklyn,  New York. Prior thereto since
1986, Mr. Lampert was an executive officer,  director and principal  stockholder
of American  Finishing & Spray,  Inc., a privately owned New Jersey  corporation
engaged in the  distribution  and sale of coating  technology for industrial and
military  application  in Newark,  New Jersey.  Prior  thereto  since 1975,  Mr.
Lampert was employed by E-TRON  Corp.,  a publicly  owned  corporation  based in
Edison,  Jersey and engaged in the manufacture of  electromechanical  components
for the United States military, in increasingly  responsible positions including
President and Chief Executive Officer. Prior thereto since 1959, Mr. Lampert was
employed as an  electrical  engineer  by various  firms  principally  engaged as
defense  contractors.  Mr.  Lampert  received  a Bachelor  of Science  degree in
Electrical Engineering from the City University of the State of New York in 1959
and a Master  of  Science  degree in  Electrical  Engineering  from  Polytechnic
Institute of New York in 1961. Mr.  Lampert  received a Juris Doctor degree from
Brooklyn Law School in 1965.

     (5) Directorship

Each Director of the Registrant  has indicated to the Registrant  that he or she
is not a director in any other Registrant with a class of securities  registered
pursuant to Section 12 of the 34 Act or subject to the  requirements  of Section
15(d) of such act or any investment  Registrant  registered under the Investment
Registrant Act of 1940.

(b) Identification of Certain Significant Employees

The Registrant  does not presently  employ any person as a significant  employee
who  is not an  executive  officer  but  who  makes  or is  expected  to  make a
significant contribution to the business of the Registrant.

(c) Family Relationships

No family  relationship  exist between any director or executive officers of the
Registrant.

(d) Involvement in Certain Legal Proceedings

No event listed in  Sub-paragraphs  (1) through (4) of Subparagraph  (d) of Item
401 of Regulation S-B, as occurred with respect to any present executive officer
or director of the  Registrant or any


<PAGE>


nominee  for  director  during the past five years and which is  material  to an
evaluation of the ability or integrity of such director or officer.

ITEM 10. EXECUTIVE COMPENSATION.

(a) General

(1) through (7) All Compensation Covered. During the fiscal year ended April 30,
1996,  no  compensation  was paid to,  accrued  or set aside  for any  executive
officer or director of the Registrant.

(b) Summary Compensation Table.

                           SUMMARY COMPENSATION TABLE
------------------------------------------------------------------------------
<TABLE>  
<CAPTION>                              
                            Annual Compensation                 Long Term Compensation
                            -------------------                 ----------------------

Name and                               Other        Restricted  Securities                   All Other
Principal                             Annual Com-     Stock      Underlying     LTIP           Compen 
Position       Year   Salary   Bonus  pensation     Award(s)      Options       Payouts        sation

<S>           <C>  <C>         <C>      <C>           <C>          <C>          <C>             <C> 
Joseph Petito 1994 $78,000(1)  None     None          None         None         None            None

Joseph Petito 1995 $78,000(1)  None     None          None         None         None            None

Joseph Petito 1996 $78,000(1)  None     None          None         None         None            None

Joseph Petito 1997 $78,000(1)  None     None          None         None         None            None
</TABLE>

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

(1) On July 24, 1995,  the Registrant  received a written  statement from Joseph
Petito wherein and whereby he irrevocably  waived any and all claims that he may
have to receive compensation from the Registrant for the four fiscal years ended
April 30, 1996 in the sum of $312,000  plus any and all  accrued  interest.  Mr.
Petito  also  waived any right  that he may have  under and with  respect to the
October 1, 1992 verbal  agreement  with the Board of Directors  granting him the
right and option to convert the Registrant's debt and obligation to him into two
shares of the  Registrant's  Common Stock, at $.01 par value, for every $1.00 of
debt.

(c)  Option/SAR  Grant Table.  During the fiscal year ended April 30,  1997,  no
grants of stock options or freestanding SAR's were made by the Registrant.

(d) Aggregate  Option/SAR Exercises and Fiscal Year- End Option/SAR Value Table.
No stock options or freestanding  SAR's are issued or outstanding.  Accordingly,
and  during  the  fiscal  year  ended  April  30,  1997,  no  stock  options  or
freestanding SAR's were exercised.  Notwithstanding


<PAGE>


the  foregoing,  an  aggregate of 1,000,000  shares of the  Registrant's  Common
Stock,  $.01 par value  per share are  reserved  for  issuance  pursuant  to the
Registrant's  long-term  incentive  plan  adopted by the  Registrant's  Board of
Directors in August, 1990, but not yet ratified and approved by the Registrant's
stockholders.

(e) Long-Term Incentive Plan ("LTIP") Awards Table. During the fiscal year ended
April 30, 1997, no LTIP awards were made by the Registrant.

(f)  Compensation of Directors.  (1) and (2). During the fiscal year ended April
30,  1997,  no director of the  Registrant  received any  compensation,  whether
pursuant to any standard or other arrangement or otherwise.

(g) Employment  Contracts and Termination of Employment,  and Change-in  Control
Arrangements.  (1) and (2). No  executive  officer,  director or employee of the
Registrant  is serving  pursuant to the terms of a written  employment  or other
compensation agreement, understanding or arrangement with the Registrant; and no
such agreement was entered into during the fiscal year ended April 30, 1997.

(h) Report on Repricing of Options/SAR's. No stock options or freestanding SAR's
are issued or outstanding.  Accordingly,  and during the fiscal year ended April
30, 1997, no stock options or freestanding SAR's were repriced.

ITEM 11. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT

(a) Security Ownership of Certain Beneficial Owner. The information is furnished
as of April 30,  1997,  as to the  number of shares of the  Registrant's  Common
Stock, $.01 par value per share owned beneficially or known by the Registrant to
own beneficially more than 5% of any class of such security:

Name and Address                   Amount and Nature
of Beneficial                      of Beneficial
Owner                              Ownership               Percentage of Class
-----                              -----------------       -------------------

Adaer Berkeley Colletone, Inc.        150,000              8.1%
659 Old Willets path
Hauppauge, NY 11788 (1)

Anita E. Petito                       180,500              9.8%
659 Old Willets Path
Hauppauge, NY 11788 (2)
--------------------------


<PAGE>


(1) A New York  corporation  controlled  by and under  common  control of Joseph
Petito,  the Registrant's  President and Chief Executive Officer and hereinafter
referred to as "ABC". See Item 11(b).

(2) Wife of Joseph Petito.  See Item 11(b).

(b) Security  Ownership of Management.  The  information is furnished as of July
30, 1997, as to the number of shares of the Registrant's  Common Stock, $.01 par
value per share owned beneficially by each executive officer and director of the
Registrant and by all executive officers and directors as a group:

Name and Address                   Amount and Nature
of Beneficial                      of Beneficial
Owner                              Ownership               Percentage of Class
-----                              -----------------       -------------------

Joseph Petito                        935,084 (1)(2)(3)            49%
659 Old Willets Path
Hauppauge, NY 11788

Irwin Lampert                        15,000(4)                  0.75%
1707 East 55th Street
Brooklyn, NY 11234

All Officers
and                                                            49.75%
Directors as a Group
--------------------------

(1) Does not include an  aggregate  of 563,400  Series A Common  Stock  Purchase
Warrants or an aggregate  of 563,400  Series B Common  Stock  Purchase  Warrants
owned by Mr. Petito and granted to him as a Class II and a Class IV creditor and
pursuant to Article III (Class V) of the Plan.  In the event all publicly  owned
Class A and Class B Warrants are exercised and Mr. Petito  exercised his Class A
and Class B Warrants,  there will be an  aggregate  of  4,061,422  shares of the
Registrant's Common Stock issued and outstanding.

(2)  Includes an aggregate of 180,500  shares of the  Registrant's  Common stock
owned of record by Anita E.  Petito,  wife of Joseph  Petito and an aggregate of
150,000 shares of the Registrant's Common Stock owned of record by ABC.

(3) Does not include an aggregate of 101,500 shares of the  Registrant's  Common
Stock owned of record by Anita M. Petito, the adult daughter of Joseph Petito or
27,400 shares owned by her husband, neither of whom reside in the same household
as Joseph Petito.

(4) Includes an aggregate of 5,000 shares of the Registrant's Common Stock owned
of record by Philip T. Lampert,  the son of Irwin  Lampert,  who resides in same
household as Irwin Lampert.


<PAGE>


(c) Changes in Control.  As of the date of this Report,  the  Registrant has not
entered into any  agreements,  the  operation of which may at a subsequent  date
result in a change of control of the Registrant.

ITEM 12. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

(a)(b) On July 30, 1997, the Registrant received a written statement from Joseph
Petito wherein and whereby he irrevocably  waived any and all claims that he may
have to receive compensation from the Registrant for the four fiscal years ended
April 30, 1997 in the sum of $312,000  plus any and all  accrued  interest.  Mr.
Petito  also  waived any right  that he may have  under and with  respect to the
October 1, 1992 verbal  agreement  with the Board of Directors  granting him the
right and option to convert the Registrant's debt and obligation to him into two
shares of the  Registrant's  Common Stock, at $.01 par value, for every $1.00 of
debt.

Except for the  foregoing  and during the fiscal  year ended  April 30, 1997 and
April 30,  1996,  no officer,  director  or relative or spouse of the  foregoing
persons or any relative of such person who has the same home as such person,  or
is a director or other officer of any parent or subsidiary of the  Registrant or
any shareholder  known by the Registrant to own of record or  beneficially  more
than  five  (5%)  percent  of the  Registrant's  Common  Stock,  had a direct or
indirect material interest in any transaction or presently proposed  transaction
to which the Registrant or any of its parents or subsidiaries was or is a party.

(c) Parents. The following  individuals and entities may be deemed to be parents
of the  Registrant:  (i) Joseph Petito,  the record and  beneficial  owner of an
aggregate of 934,934  shares of the  Registrant's  Common  Stock;  (ii) Anita E.
Petito, the record and beneficial owner of an aggregate of 180,500 shares of the
Registrant's  Common  Stock;  and ABC,  the  record and  beneficial  owner of an
aggregate of 150,000 shares of the Registrant's Common Stock, which are included
in the aggregate amount shown for Joseph Petito; (iii) Irwin Lampert, the record
and beneficial owner of an aggregate of 15,000 shares.

(d) Transactions with Promoters. Inapplicable.

ITEM 13. EXHIBITS, LIST AND REPORTS ON FORM 8-K

(a) Exhibits and Index Required.

(1) EXHIBIT INDEX

Description of Document                                Location

(3)(a) Certificate of Incorporation     Exhibit (1)(i) filed with Form S-1
                                        Registration Statement

(3)(b)  Certificate  of Amendment to    Item (1)(ii) filed with Form 10K  
Certificate of Incorporation            year ended April 30, 1983


<PAGE>


(3) By-Laws                             Exhibit (b)(ii) filed with Form S-1
                                        Registration Statement

(4) Instruments defining the rights 
    of security holders, including 
    indentures

(a) Form of Common Stock                Filed with Form 10K year ended April 30,
                                        1993


(b) Form of Class A Common              Filed with Form 10K year ended April 30,
    Stock Purchase Warrant              1993

(c) Form of Class B Common              Filed with Form 10K year ended April 30,
    Stock Purchase Warrant              1993

(10) Material Contracts

(a) Disclosure Statement dated          Filed with Form 10K year ended April 30,
    December 15, 1989                   1993


(b) Plan of Reorganization
    dated December 15, 1989             Filed with Form 10K year ended April 30,
                                        1993

(c) Order confirming Plan of            Filed with Form 10K year ended April 30,
    Arrangement dated                   1993
    April 30, 1990


(d) Letter of transmittal to            Filed with Form 10K year ended April 30,
    stockholders dated                  1993
    September 19, 1990,
    together with related letter 1993
    of transmittal from Liberty 
    Transfer Co.


(e) Consummation Order-Final Decree     Filed with Form 10K year ended April 30,
    dated June 2, 1992                  1993


(11) Statement re computation of                        N/A
    


<PAGE>


     Per Share Earnings

(12) Statements re computation of                       N/A
     ratios

(13) Annual Report to Security                          N/A
     Holders, Form 10-K, or quarterly
     reports, 10-Q, to security
     holders

(16) Letter on Change in Certifying     Letter from Scarano & Lipton filed
     Accountants                        with this report

(18) Letter re changes in                               N/A
     accounting principles

(19) Previously unfiled documents                       N/A

(22) Subsidiaries of the Registrant     Filed with Form 8K July 18, 1993


(23) Published report regarding                         N/A
     matters submitted to vote on
     security holders

(24) Consents to experts and
      counsel                           Page II-6 filed with Form S-1 
                                        Registration Statement

(25) Power of Attorney                                  N/A

(26) Additional Exhibits                                N/A



(b) Reports on Form 8-K.  During the fiscal year ended April 30,  1997, a report
on Form 8-K was prepared and filed by the Registrant.


                                   SIGNATURES

Pursuant to the  requirements  of Section 12 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.

Dated: Ronkonkoma, New York


<PAGE>

     September 25, 1997 
                                           ORION DIVERSIFIED TECHNOLOGIES, INC.


                                           BY:
                                              ----------------------------------
                                              JOSEPH PETITO, President and Chief
                                              Executive Officer, Treasurer
                                              and Chief Financial Officer

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

Dated:  Ronkonkoma, New York
        September 25, 1997
                                              ----------------------------------
                                              JOSEPH PETITO, Director

Dated:  Ronkonkoma, New York
        September 25 , 1997                       
                                              ----------------------------------
                                              IRWIN LAMPERT, Director



<PAGE>


To the Board of Directors and Stockholders of
Orion Diversified Technologies Inc.
Hauppauge, New York

I  have  audited  the   accompanying   balance   sheets  of  Orion   Diversified
Technologies,  Inc. and its 86%  majority-owned  subsidiary as of April 30,1 997
and 1996 and the related  consolidated  statements of  operations,  stockholders
equity  (deficiency)  and cash flows for the years then ended.  These  financial
statements are the responsibility of the Company's management. My responsibility
is to express an opinion on these financial statements based on my audits. I did
not audit the  financial  statements  of Netherland  Gardens  Owners,  Inc. (the
"Company's 86% majority-owned subsidiary), which statements reflect total assets
constituting  approximately 89% and 90% of consolidated total assets as of April
30,1996 and total revenues constituting approximately 100% of consolidated total
revenues  for the year ended April 30,  1996.  Such  financial  statements  were
audited  by  another  auditor  whose  report  has been  furnished  to me, and my
opinion,  insofar as it relates to the amount  included for  Netherland  Gardens
Owners, Inc. is based solely on the report of such other auditor.

Except as  discussed  in the  following  paragraphs,  I  conducted  my audits in
accordance with generally accepted auditing  standards.  Those standards require
that I plan and perform the audit to obtain  reasonable  assurance about whether
the financial  statements are free of material  misstatement/  Am audit includes
assessing the evidence  supporting the amounts and  disclosures in the financial
statements.  An audit also includes assessing the accounting principles used and
significant  estimates  made by  management,  as well as evaluating  the overall
financial statement presentation.  I believe that my audit and the report of the
other auditor provides a reasonable basis for my opinion.

The  Company  did not count its  physical  inventory  at April 30, 1997 and 1996
because  identification  of items  and  quantities  were  destroyed  during  the
physical  relocation  of the  inventory.  Therefor,  I was unable to observe the
physical inventories and satisfy myself about inventory items and quantities.

In my opinion, based on my audits and reports of another auditor, except for the
effects  of such  adjustments  if any,  as  might  have  been  determined  to be
necessary  had I been able to observe the physical  inventories,  the  financial
statements fairly, in all material  respects,  reflect the financial position of
Orion Diversified  Technologies,  Inc. and its 86%-owned  subsidiary as of April
30, 1996 and the results of their  operations and their cash flows for the years
then ended in conformity with generally accepted accounting principles.

The  accompanying  financial  statements  have been  prepared  assuming that the
company  will  continue as a going  concern.  As  discussed  in Note 1(b) to the
financial  statements,  the Company has incurred  losses for several  years that
raise  substantial  doubt  about its  ability to  continue  as a going  concern.
Management's plans in regard to these matters are also described in Note 1(b).


<PAGE>


The financial  statements do not include any adjustments  that might result from
the outcome of this uncertainty.

Meyer Zimmerman
Woodbury, New York


<PAGE>


                      ORION DIVERSIFIED TECHNOLOGIES, INC.
                                  BALANCE SHEET

                                                          April 30,    April 30,
                                                            1997         1996
                                                          --------     --------
                           ASSETS
                           ------
Current Assets:
         Cash                                                    0            0
         Maintenance Receivables                                 0            0
         Inventory                                         104,101      104,101
         Rent Receivable                                         0            0
         Due from Michaels Associates                            0            0
                                                          --------     --------
         Net to allow for bad debts of $242,000
                  Total Current Assets                     104,101      104,101
                                                          --------     --------
Property:
         Land                                                    0            0
         Buildings (Net)                                         0            0
                                                                 0            0
                                                          --------     --------
Other Assets:
         Cash - Capital Reserve                                  0            0
         Excess of Cost Over Net Assets Acquired                 0            0
         Security Deposit                                        0            0
                                                          --------     --------
                  Total Assets                             104,101      104,101
                                                          --------     --------

         LIABILITIES & STOCKHOLDERS EQUITY
         ---------------------------------

Current Liabilities
         Accounts Payable and Accrued Expenses               5,000        5,000
         Due to Officers                                   123,862      123,712
         Payroll Taxes Payable - Chapter XI                137,465      137,465
         Payroll Taxes Payable                                   0            0
                                                          --------     --------
                                                           266,327      266,177
                                                          --------     --------
         LONG TERM DEBT
         --------------

Mortgage Payable
         Total Liabilities                                       0            0
                  Total Liabilities                        266,327      266,177
Minority Interest in Subsidiary                                  0            0
                                                          --------     --------

Stockholders Equity
         Common Stock, Par Value $.01                      184,443       18,443
         Paid-In Capital                                     3,737        3,737
         Deficit                                          (184,402)    (184,256)
                                                          --------     --------
Total Stockholders Equity                                 (162,226)    (162,076)
                                                          --------     --------
Total Liabilities & Stockholders Equity                    104,101      104,101
                                                          --------     --------


<PAGE>


                      ORION DIVERSIFIED TECHNOLOGIES, INC.
                             STATEMENT OF OPERATIONS
              THE YEAR ENDED APRIL 30, 1997 AND 1996 (CONSOLIDATED)

INCOME                                                  1997             1996
------                                                  ----             ----

Revenues
         Maintenance Fees                                     0         194,371
                                                     ----------      ----------

Costs & Expenses
         General & Administrative                           150          93,133
         Interest                                             0          93,188
         Depreciation & Amortization                          0          88,600
                                                     ----------      ----------

                  Total Costs & Expenses                    150         274,921
                                                     ----------      ----------

         Loss Before Minority Interest                        0         (80,550)

         Minority Interest in Net Loss of
          Subsidiary                                          0          10,290
                                                     ----------      ----------

                  Net Loss                                 (150)        (70,260)
                                                     ----------      ----------

Net Loss Per Common Share                                   Nil            (.03)

Weighted Average Number of Common Shares              1,844,397       1,844,397


<PAGE>



                      ORION DIVERSIFIED TECHNOLOGIES, INC.
                  CONSOLIDATED STATEMENT OF STOCKHOLDERS EQUITY
                          THE YEAR ENDED APRIL 30, 1997
<TABLE>
<CAPTION>

                                                        Additional
                            Common Stock                  Paid In         Accumulated
                       Shares          Amount             Capital          Deficient            Total
                       ------          ------             -------          ---------            -----

<S>                   <C>           <C>                <C>                <C>                 <C>        
Balance 4/30/96       1,844,397     $   18,443         $    3,373         $ (184,256)         $ (162,076)

Loss For Period                                                                  150)         $     (150)
                      --------------------------------------------------------------          -----------

                      1,844,397     $   18,447         $    3,373         $  184,406          $ (162,226)
</TABLE>



<PAGE>



                      ORION DIVERSIFIED TECHNOLOGIES, INC.
                           STATEMENT OF CASH FLOWS FOR
              THE YEAR ENDED APRIL 30, 1997 AND 1996 (CONSOLIDATED)

                                                              1997       1996
                                                              ----       ----

Cash Flow from Operating Activities

         Net Loss                                            (150)      (70,260)

Adjustments to Reconcile Net Loss
to Net Cash Provided by (Used For)
Operating Activities

Depreciation & Amortization                                     0             0
Minority Interest in Net Loss of Subsidiary                     0       324,265

Changes in Assets & Liabilities
         Accounts Receivable                                    0         4,715
         Rent Receivables                                       0             0
         Due From Michaels Associates                           0       369,547
         Purchase of Equipment                                  0             0
         Provision for Bad Debts                                0             0
         Accounts Payable & Accrued Expenses                    0      (293,358)
         Payroll Taxes Payable                                150       (30,244)
         Due to Officers                                        0         7,399
         Mortgage Payable                                       0    (1,775,000)
         Capital Reduction                                      0       (20,305)
         Land                                                   0       470,350
         Building                                               0     3,636,109
         Other Assets                                           0        32,306
         Loan Payable - Other                                   0             0
                                                       ----------    ----------

         Net Cash Provided By (Used In) Operations              0        (3,201)
                                                       ----------    ----------

Net Increase/Decrease in Cash                                   0        (3,201)
                                                       ----------    ----------

Cash - Beginning                                                0         3,201
                                                       ----------    ----------

Cash - Ending                                                   0             0
                                                       ----------    ----------


<PAGE>



                      ORION DIVERSIFIED TECHNOLOGIES, INC.
                           STATEMENT OF CASH FLOWS FOR
              THE YEAR ENDED APRIL 30, 1997 AND 1996 (CONSOLIDATED)

                                                             1997          1996
                                                           -------       -------

Supplemental Disclosure of Cash Flow
 Information:

         Cash Paid During the Periods For:

             Interest Paid                                       0        93,188
                                                           -------       -------

In  connection  with the  payment by the
Company of Monthly Maintenance in its
Subsidiary, the Company received credit
for rental income paid directly to the
Subsidiary by the Company's tenants                              0       194,371
                                                           -------       -------


<PAGE>



                      ORION DIVERSIFIED TECHNOLOGIES, INC.
                                 AND SUBSIDIARY
                  NOTES TO FINANCIAL STATEMENTS APRIL 30, 1997

NOTE I - SUMMARY OF SIGNIFICANT ACCOUNT PRINCIPLES

(a) Organization and Principles of Consolidation

The accompanying consolidated financial statements include the accounts of Orion
Diversified  Technologies,  Inc.,  "Orion  and the  Company"  and its 86%  owned
subsidiary,  Netherland Gardens Owners, Inc., "NGO". The financial statements of
Orion and NGO are being  consolidated  at April 30,  1996 as a result of Orion's
control of NGO's Board of  Directors,  see Note 2.As  indicated in Note 2, Orion
divested  itself  of NGO on  January  11,  1996.  All  significant  intercompany
balances and transactions have been eliminated in consolidation.

The Company,  through a contractual  relationship,  sells  semiconductors,  on a
highly limited  basis,  to independent  distributors  and to original  equipment
manufacturers or other end-users.  For the three years ended April 30, 1996, the
Company had minimal  revenues from these sources.  The majority of the financial
statement  balances relate to NGO, since Orion had minimal  operations and filed
for bankruptcy in prior years (See Note 6).

(b) Going Concern Basis of Presentation

The accompanying consolidated financial statements have been prepared on a going
concern basis which  contemplates  the realization of assets and satisfaction of
liabilities in the normal course of business.

Orion has not realized any material revenues for the three years ended April 30,
1996,  and the  consolidated  results of operations for the year ended April 30,
1995 reflect a loss of $223,034.  The Company also is entirely  supported by its
majority shareholder.  These factors raise substantial doubt about the Company's
ability to continue as a going concern.

Management's long standing plans to remedy these conditions  involves a business
combination with a profitable  private company in a reverse merger  transaction.
The Company further anticipates an eventual improvement in liquidity through the
exercise of the Company's Class A and B Warrants (Note 8).

(c) Inventories

Inventories,  which  are  located  on the  premises  of a  non-affiliated  party
pursuant to a revenue sharing agreement, are comprised of semiconductors and are
held for resale, are stated at the lower of cost (first-in  first-out method) or
market as of April 30, 1993. Physical inventories were not observed at April 30,
1996 and 1995.


<PAGE>


                      ORION DIVERSIFIED TECHNOLOGIES, INC.
                                 AND SUBSIDIARY
                  NOTES TO FINANCIAL STATEMENTS APRIL 30, 1997


(d) Land, Buildings and Equipment

 Land,   buildings  and  equipment  are  carried  at  cost.   Expenditures   for
 maintenance, repairs and minor renewals are charged to operations; expenditures
 for betterments are  capitalized.  Depreciation  and  amortization are computed
 using the straight-line method.

(e) Excess of Cost Over Net Assets Acquired

Excess of costs over net assets  acquired are being amortized of five (5) years,
which is management's  estimate of the time period needed to sell the apartments
shares in its co-operative subsidiary.

(f) Income Taxes

The company  accounts for income taxes in accordance with Statement of Financial
Accounting  Standards No. 109,  "Accounting for Income Taxes" which requires the
use of the  "liability  method" of  accounting  for income  taxes.  Accordingly,
deferred  tax  liabilities  and assets are  determined  based on the  difference
between the financial  statement and tax bases of assets and liabilities,  using
enacted tax rates in effect for the year in which the  differences  are expected
to reverse.  Current  income  taxes are based on the year's  taxable  income for
Federal and State income tax reporting purposes.

(g) Allowance for Bad Debts

The Company has made a specific provision related to the receivable from Michael
Associates,   the   non-affiliated   former  owner  of  NGO,  based  on  current
circumstances.  On  January  11,  1996,  Orion  conveyed  NGO  back to  Michaels
Associates. See Note 2.

(h) Net Loss Per Share of Common Stock

Net loss per share of common stock is based on the loss for each period  divided
by the weighted average number of shares of common stock outstanding during each
period.  Common stock equivalents have been excluded from the computation of net
loss per share of common stock since the result would be anti-dilative.

(i) Reclassification

Certain  reclassifications  have been made to the 1993  financial  statements in
order to conform to the 1996 and 1995 presentation.


<PAGE>


                      ORION DIVERSIFIED TECHNOLOGIES, INC.
                                 AND SUBSIDIARY
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                 APRIL 30, 1996

NOTE 2

ACQUISITION AND DIVESTITURE OF NETHERLAND GARDENS OWNERS, INC.

Agreement

On  February  25,  1993,   the  Company   acquired  from  Michaels   Associates,
("Michaels")  then an unrelated  party,  its  interest in a 59 unit  cooperative
housing corporation located in White Plains, New York.

The Company exchanged 500,000 shares of restricted common stock with an assigned
value of $5.00  per  share  for all the  shares  held by  Michael.  Such  shares
represented an 86% interest in the cooperative housing corporation.  The Company
also agreed to pay brokers or finders commissions in the amount of 50,000 shares
of restricted common stock,  which represents 10% of the purchase price. The net
asset value at the date of acquisition approximated $2,600,000.

The Company's  stock  valuation in the  transaction  was based in part by values
determined in connection with the Company's Plan of  Reorganization  in the 1990
Chapter 11 Bankruptcy  proceedings.  The Plan of Reorganization provided for the
issuance of unrestricted shares to the unsecured  creditors as follows:  One (1)
share of common stock together with one (1) Class A Warrant, and one (1) Class B
Warrant for every $5.00 of debt. In the purchase for the equity ownership in NGO
it was  agreed  between  the  parties  that such  $5.00  value for each share be
maintained  without  giving  consideration  in such valuation to the Class A and
Class B Warrants.

The shares  acquired from Michaels was subject to a lien of $390,000,  which was
to be satisfied by Michaels.  Since  Michaels' lien holder had possession of the
shares to be tendered to the Company,  the Company held Michaels' 500,000 shares
in escrow until the NGO shares were received.  Additionally,  the agreement with
the lien  holder  stipulated  that upon sale of the  apartment  units,  the lien
holder was to receive  $12,500 for the first  eight (8) units sold,  and $25,000
per unit  thereafter.  As of April 30, 1993,  ten (10)  apartment  were sold. No
additional apartment units were sold from May 1, 1993 through January 11, 1996.



<PAGE>



                      ORION DIVERSIFIED TECHNOLOGIES, INC.
                                 AND SUBSIDIARY
                  NOTES TO FINANCIAL STATEMENTS APRIL 30, 1997

NOTE 2

ACQUISITION OF NETHERLAND GARDENS OWNERS, INC.(continued)

Agreement

The acquisition agreement further provided that Michaels, designees were to have
two seats out of three on the Board of Directors of the Company.  It was further
agreed that the Company's  single  Director was to have a weighted vote of three
Directors  on all issues  except  matters  related  to NGO and on such  matters,
Michaels was to have two votes on the Board of Directors  and the Company was to
have one vote.  On  November  22,  1993 the  acquisition  agreement  was amended
eliminating Michaels favorable two vote status in matters concerning NGO.

Accounting

The  Michaels   acquisition  was  accounted  for  under  the  purchase   method.
Accordingly, for the year ended April 30, 1993, the Company's operations reflect
its pro rata share of operations from the date of acquisition, February 25, 1993
to April 30, 1993.


Pro-forma Supplementary Information

The results of operations  for the preceding  period had the  acquisition  taken
place at the beginning of fiscal year April 30, 1993 would be the following:

                       Revenue                    $  338,080
                                                  -----------
                       Net Loss                   $ (322,086)
                                                  -----------
                       Loss Per Share             $    (0.22)
                                                  -----------

Weighted Average Shares Outstanding 1,459,058

Net loss  included  amortization  of excess of cost over net assets  acquired of
$8,768.

The above data  combined  the  results  of the  cooperative  housing  unit as of
December 31,


<PAGE>




                      ORION DIVERSIFIED TECHNOLOGIES, INC.
                                 AND SUBSIDIARY
                  NOTES TO FINANCIAL STATEMENTS APRIL 30, 1997


NOTE 2

ACQUISITION AND DIVESTITURE OF NETHERLAND GARDENS OWNERS, INC.(continued)

Pro-forma Supplementary Information

with  Orion's  results as of April 30. The  results of  operations  would not be
materially  different if the Company  provided  financial  data on a fiscal year
basis.

In light of the continuing losses of NGO and the lack of cash distributions, the
Company divested NGO as of January 11, 1996.


Organization and Revenues

Netherland   Gardens  Owners,   Inc.  is  a  cooperative   housing   corporation
incorporated  in the State of New York on  December  8,  1986.  The  Cooperative
Corporation acquired the property from Michaels January 4, 1990. The Corporation
owns two  buildings  known as  Netherland  Gardens  Apartments  located in White
Plains,  New  York.  The  apartments  consist  of  58  residential  units  and a
superintendent's  apartment.  The primary purpose of the Cooperative Corporation
was to manage the operations of Netherland  Gardens  Apartments and maintain the
common areas.

Orion,  through its investments in the Cooperative  Corporation,  owned 48 units
through  January 11, 1995 and received  rental  income from the  occupied  units
through that date.


Divestiture

On January 11, 1996,  and as  described  in Item 1 of this  Report,  the Company
divested  itself of its  equity  interest  in NGO and  received  450,000  of the
550,000  shares it originally  issued in  connection  with this  acquisition  in
February 1993.


<PAGE>


                      ORION DIVERSIFIED TECHNOLOGIES, INC.
                                 AND SUBSIDIARY
                  NOTES TO FINANCIAL STATEMENTS APRIL 30, 1997

NOTE 3

Inventory

In March  1994,  the  Company  entered  into an  agreement  with New Jersey Semi
Conductor  Products,  Inc.,  a  non-affiliated  New Jersey  Corporation  "NJSC",
whereby NJSC will continue to test, clean, mark, package and offer the Company's
entire semiconductor inventory for sale. Proceeds from the sale of the inventory
will be divided  equally,  except for finders fees that have not been determined
between  the  parties,  which will be paid out of Orion's  profit  share.  Orion
received a $5,000  advance from NJSC against  future sales.  Since July 1995, no
sales proceeds have been received by the Company.  Accordingly,  and in light of
NJSC's failure to sort the inventory as required,  such  inventory  could not be
physically  observed since  identification  items and quantities  were destroyed
during the relocation of said inventory.

NOTE 4

Land. Buildings and Equipment

Land and buildings are recorded at NGO's cost of $4,970,350  which is based upon
the  contract  of  exchange  outlining  the terms of NGO's  acquisition  of such
property from Michael Associates. in said contract,  $4,500,000 was allocated to
the building and the remaining  amount to land. As a result,  the carrying value
of the land and  buildings  was  stepped  up by  $3,255,258  over the  sponsor's
historical  cost. Land,  buildings and equipment  consist of the following as of
April 30:

                                                   1997        1996
                                                   ----        ----

                  Land                              0           0
                  Buildings                         0           0
                  Equipment                         0           0
                                                    -           -

           Less: Accumulated                        0           0
                                                    -           -
           Depreciation                             0           0

The buildings were depreciated over 27 1/2 years using the straight-line method.
Repairs for the years  ended  April 30, 1996 and 1995  amounted to 0 and $26,458
respectively.


<PAGE>


                      ORION DIVERSIFIED TECHNOLOGIES, INC.
                                 AND SUBSIDIARY
                  NOTES TO FINANCIAL STATEMENTS APRIL 30, 1997

NOTE 5

         Accounts Payable and Accrued Expenses

                                             1997             1996
                                             ----             ----

Trade Payable                               $    0          $    0
Professional Fees                                0               0
Real Estate Taxes                                0               0
Advance Against Inventories                  5,000           5,000
                                            ------          ------
                                            $5,000          $5,000

NOTE 6

Payroll Taxes - Chapter 11

In connection with the Plan of Reorganization, payroll taxes were due within six
years  from  April  23,  1986  the  date  of  assessment.  Accordingly,  the tax
liability, which includes accrued interest, is classified as current.

NOTE 7

Common Stock Purchase Warrants

In accordance with the Plan of  Reorganization,  905,262  redeemable Class A and
Class B Purchase  Warrants were issued  between  September 19, 1990 and December
30, 1990.  Each  Warrant  entitles the holder to purchase one "new" share of the
Company'  stock for each Warrant that is  exercised.  The exercise  price of the
Class A and Class B Warrants are $2.50 and $3.50  respectively.  The  expiration
date for both classes of Warrants was extended to December 31, 1998 by the Board
of Directors.

As of April 30, 1997 and 1996, 903,761 Class A and 905,262 Class B Warrants were
outstanding.

NOTE 8

Income Taxes

Effective May 1, 1991,  the Company  adopted  Statement of Financial  Accounting
Standards  (SFAS) No.  109,  "Accounting  for Income  Taxes".  Income  taxes are
provided  for  the  tax  effects  of  transactions  reported  in  the  financial
statements  and  consist of taxes  currently  due plus  deferred  taxes  related
primarily  to  differences  between  the  financial  and tax basis of assets and
liabilities.


<PAGE>


                      ORION DIVERSIFIED TECHNOLOGIES, INC.
                                 AND SUBSIDIARY
                  NOTES TO FINANCIAL STATEMENTS APRIL 30, 1997

NOTE 8

Income Taxes (continued)

The  Company's  subsidiary  is taxed  only on  non-cooperative  income,  such as
interest  income,  The subsidiary  files tax returns on a separate return basis.
Earnings from cooperative derived sources may be excluded from taxation,  if the
Company elects to refund to shareholders, on a-pro rata basis, the excess income
within eight and a half (8 1/2) months after the close of the  corporation's tax
year.

          The  parent  company  net  operating  loss   carryforwards  and  their
          expiration dates are as follows:

                  Year of Expiration                 Amount
                  ------------------                 ------

                       1997                        $  83,000
                       1999                          128,000
                       2000                           84,000
                       2001                            1,000
                                                   ---------

          Thereafter, expiring 2003-2010           $ 666,260
                                                   ---------
                                                   $ 962,260

NOTE 10

Related Party Transactions

a) Transactions with Management

     The Company has agreed to certain  transactions  with  Joseph  Petito,  the
company's President, Chief Operating Officer, Chairman of the Board and majority
shareholder. Such transactions are described below:

1. Facilities

     From March 1, 1992 through June 1995, the Company  maintained its executive
offices and facilities at 659 Old Willets Path, Hauppauge, New York.


<PAGE>


                      ORION DIVERSIFIED TECHNOLOGIES, INC.
                                 AND SUBSIDIARY
                  NOTES TO FINANCIAL STATEMENTS APRIL 30, 1997

1. Facilities (continued)

The rent for this  facility  was  paid,  on a month to month  basis,  to,  Adaer
Berkeley  Colletone,  Inc., a corporation  controlled by Mr. Petito. The Company
paid a rental of $1,895 per month,  with a  proportionate  share,  from March 1,
1992  through  April  30,  1995 of any tax  increase  from  its base tax year of
1991-1992. The rent paid to Mx. Petito was the same amount as paid by Mr. Petito
to the facility's landlord.  Rent expense for the years ended April 30, 1994 and
1993 amount to $22,500 and $21,862, respectively.

In June 1995, and as a result of a fire at its Hauppauge  facility,  the Company
moved to its present facility where it sub-leases  space,  rent free from Joseph
Petito.

b) Compensation and Other Costs

The Company has had minor sales and no other income since the  relocation of its
offices.  As a result,  virtually all of the Company's  operating  expenses have
been advanced by Mr. Petito for the four years ended April 30, 1997.

Costs  advanced to the Company by Mr.  Petito from May 1, 1992 through April 30,
1995 amounted to $64,195.

On June 2, 1990, the Board of Directors  agreed to provide  compensation  to Mr.
Petito,  at the rate of $1,500 per week.  On May 2, 1994,  Mr.  Petito agreed to
forego the $1,500  weekly  compensation  until the Company  shows a  significant
upward  trend in its  results of  operations.  As the  Company  has had  minimal
revenues,  compensation  of $78,000 from the year ended April 30, 1994 and costs
of  $64,195,  for the three (3) years  ended  April 30, 1995 were not paid which
amounted to approximately $38,318 as at April 30, 1995.

Both the  compensation and other costs owed as of April 30, 1993 were liquidated
in accordance with the following:

On June 2, 1990,  The Board of Directors  approved that the  liquidation of such
outstanding indebtedness can be made by the issuance of the Company's restricted
common  stock on the  basis of two  shares  for  every  $1.00 of debt or a chase
reimbursement at Mr . Petito's  option.  At April 30, 1993, Mr. Petito converted
$418,817 of debt to 837,634 shares, respectively.


<PAGE>



                      ORION DIVERSIFIED TECHNOLOGIES, INC.
                                 AND SUBSIDIARY
                  NOTES TO FINANCIAL STATEMENTS APRIL 30, 1997

                  c) Due to Officer

                  The details of the Due to Officer Account are as follows:

                                                   Salary    Advances    Total
                                                   ------    --------    -----

Balance - April 30, 1993                          $      0   $      0   $      0

Additional                                          78,000     22,089    100,089

Balance - April 30, 1994                          $ 78,000     22,089    100,089

  Additions - April 30, 1995                             0     16,229      6,229

  April 30, 1996                                         0      7,394      7,394
                                                  ------------------------------

Balance April 30, 1996                                       $ 45,718   $123,372

  Additions - April 30, 1997                                      150        150
                                                  --------   --------   --------

                                                  $ 78,000   $ 45,868    123,828

NOTE 11

                      Future Major Repairs and Replacements

                        See Note 2 Regarding Divestiture.